Quarterly report pursuant to Section 13 or 15(d)

Investments in Unconsolidated Real Estate Joint Ventures

v3.22.2
Investments in Unconsolidated Real Estate Joint Ventures
6 Months Ended
Jun. 30, 2022
Investments In Unconsolidated Real Estate Joint Ventures [Abstract]  
Investments in Unconsolidated Real Estate Joint Ventures Investments in Unconsolidated Real Estate Joint Ventures
The equity method of accounting is used to account for each of the individual joint ventures. We have an ownership interest in the following unconsolidated real estate joint ventures:
As of June 30, 2022
Joint Venture Outlet Center Location Ownership % Square Feet
(in 000’s)
Carrying Value of Investment (in millions)
Total Joint Venture Debt, Net
(in millions)(1)
Investments included in investments in unconsolidated joint ventures:
RioCan Canada Various 50.0  % 665  $ 80.0  — 
$ 80.0 
Investments included in other liabilities:
Columbus(2)
Columbus, OH 50.0  % 355  $ (1.2) $ 70.9 
Charlotte(2)
Charlotte, NC 50.0  % 399  (17.7) 99.6 
National Harbor(2)
National Harbor, MD 50.0  % 341  (12.3) 94.6 
Galveston/Houston (2)
Texas City, TX 50.0  % 353  (15.0) 64.4 
$ (46.2)
As of December 31, 2021
Joint Venture Outlet Center Location Ownership % Square Feet
(in 000’s)
Carrying Value of Investment (in millions)
Total Joint Venture Debt, Net
(in millions)(1)
Investments included in investments in unconsolidated joint ventures:
Columbus Columbus, OH 50.0  % 355  $ 0.2  $ 70.9 
RioCan Canada Various 50.0  % 665  82.4  — 
$ 82.6 
Investments included in other liabilities:
Charlotte(2)
Charlotte, NC 50.0  % 399  $ (16.2) $ 99.6 
National Harbor(2)
National Harbor, MD 50.0  % 341  (11.2) 94.5 
Galveston/Houston (2)
Texas City, TX 50.0  % 353  (14.0) 64.4 
$ (41.4)
(1)Net of debt origination costs of $1.0 million as of June 30, 2022 and $1.0 million as of December 31, 2021.
(2)The negative carrying value is due to distributions exceeding contributions and increases or decreases from our equity in earnings of the joint venture.

Fees we received for various services provided to our unconsolidated joint ventures were recognized in management, leasing and other services as follows (in thousands):
Three months ended Six months ended
June 30, June 30,
  2022 2021 2022 2021
Fee:    
Management and marketing $ 552  $ 537  $ 1,088  $ 1,045 
Leasing and other fees —  103  35  159 
Expense reimbursements from unconsolidated joint ventures 884  719  1,840  1,527 
Total Fees $ 1,436  $ 1,359  $ 2,963  $ 2,731 
Our investments in real estate joint ventures are reduced by the percentage of the profits earned for leasing and development services associated with our ownership interest in each joint venture. Our carrying value of investments in unconsolidated joint ventures differs from our share of the assets reported in the “Condensed Combined Balance Sheets - Unconsolidated Joint Ventures” shown below due to adjustments to the book basis, including intercompany profits on sales of services that are capitalized by the unconsolidated joint ventures. The differences in basis (totaling $3.3 million and $3.4 million as of June 30, 2022 and December 31, 2021, respectively) are amortized over the various useful lives of the related assets.

RioCan Canada

In March 2021, the RioCan joint venture closed on the sale of its outlet center in Saint-Sauveur, for net proceeds of approximately $9.4 million. Our share of the proceeds was approximately $4.7 million. As a result of this transaction, we recorded a loss on the sale of $3.7 million. This includes a $3.6 million charge related to the foreign currency effect of the sale recorded in other income (expense), which had been previously recorded in other comprehensive income.

Condensed combined summary financial information of unconsolidated joint ventures accounted for using the equity method is as follows (in thousands):

Condensed Combined Balance Sheets - Unconsolidated Joint Ventures June 30, 2022 December 31, 2021
Assets    
Land $ 83,641  $ 83,568 
Buildings, improvements and fixtures 465,644  467,918 
Construction in progress 231  744 
549,516  552,230 
Accumulated depreciation (175,431) (166,096)
Total rental property, net 374,085  386,134 
Cash and cash equivalents 14,856  19,030 
Deferred lease costs and other intangibles, net 3,190  3,517 
Prepaids and other assets 10,432  13,109 
Total assets $ 402,563  $ 421,790 
Liabilities and Owners’ Equity    
Mortgages payable, net $ 329,535  $ 329,460 
Accounts payable and other liabilities 13,128  15,231 
Total liabilities 342,663  344,691 
Owners’ equity 59,900  77,099 
Total liabilities and owners’ equity $ 402,563  $ 421,790 
  Three months ended Six months ended
Condensed Combined Statements of Operations - Unconsolidated Joint Ventures June 30, June 30,
2022 2021 2022 2021
Revenues $ 21,666  $ 22,601  $ 43,507  $ 43,594 
Expenses:  
Property operating 8,435  8,448  16,738  16,862 
General and administrative 40  58  133  86 
Depreciation and amortization 5,540  5,763  11,021  11,664 
Total expenses 14,015  14,269  27,892  28,612 
Other income (expense):
Interest expense (3,158) (2,910) (6,073) (5,855)
Gain on sale of assets —  —  —  503 
Other income 96  154 
Total other expense (3,155) (2,814) (6,067) (5,198)
Net income $ 4,496  $ 5,518  $ 9,548  $ 9,784 
The Company and Operating Partnership’s share of:    
Net income $ 2,227  $ 2,728  $ 4,740  $ 4,497 
Depreciation and amortization (real estate related) $ 2,791  $ 2,913  $ 5,545  $ 5,909