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8-K - FORM 8-K - APARTMENT INVESTMENT & MANAGEMENT CO | c08461e8vk.htm |
EX-23.1 - EXHIBIT 23.1 - APARTMENT INVESTMENT & MANAGEMENT CO | c08461exv23w1.htm |
Exhibit 99.1
Item 6. Selected Financial Data
The following selected financial data is based on our audited historical financial statements.
This information should be read in conjunction with such financial statements, including the notes
thereto, and Managements Discussion and Analysis of Financial Condition and Results of
Operations included herein or in previous filings with the Securities and Exchange Commission.
For the Years Ended December 31, | ||||||||||||||||||||
2009 (1) | 2008 (1) (2) | 2007 (1) | 2006 (1) | 2005 (1) | ||||||||||||||||
(dollar amounts in thousands, except per share data) | ||||||||||||||||||||
OPERATING DATA: |
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Total revenues |
$ | 1,151,736 | $ | 1,199,423 | $ | 1,132,109 | $ | 1,043,683 | $ | 866,992 | ||||||||||
Total operating expenses (3) |
(1,051,394 | ) | (1,151,459 | ) | (958,070 | ) | (879,107 | ) | (731,102 | ) | ||||||||||
Operating income (3) |
100,342 | 47,964 | 174,039 | 164,576 | 135,890 | |||||||||||||||
Loss from continuing operations (3) |
(198,703 | ) | (119,163 | ) | (50,097 | ) | (44,798 | ) | (36,366 | ) | ||||||||||
Income from discontinued operations, net (4) |
153,903 | 746,165 | 175,603 | 331,820 | 161,718 | |||||||||||||||
Net (loss) income |
(44,800 | ) | 627,002 | 125,506 | 287,022 | 125,352 | ||||||||||||||
Net income attributable to noncontrolling interests |
(19,474 | ) | (214,995 | ) | (95,595 | ) | (110,234 | ) | (54,370 | ) | ||||||||||
Net income attributable to preferred stockholders |
(50,566 | ) | (53,708 | ) | (66,016 | ) | (81,132 | ) | (87,948 | ) | ||||||||||
Net (loss) income attributable to Aimco common
stockholders |
(114,840 | ) | 351,314 | (40,586 | ) | 93,710 | (21,223 | ) | ||||||||||||
Earnings (loss) per common share basic and
diluted (5): |
||||||||||||||||||||
Loss from continuing operations attributable to
Aimco common stockholders |
$ | (1.75 | ) | $ | (2.11 | ) | $ | (1.42 | ) | $ | (1.48 | ) | $ | (1.33 | ) | |||||
Net (loss) income attributable to Aimco common
stockholders |
$ | (1.00 | ) | $ | 3.96 | $ | (0.43 | ) | $ | 0.98 | $ | (0.23 | ) | |||||||
BALANCE SHEET INFORMATION: |
||||||||||||||||||||
Real estate, net of accumulated depreciation |
$ | 6,795,391 | $ | 6,956,631 | $ | 6,729,914 | $ | 6,265,294 | $ | 5,573,491 | ||||||||||
Total assets |
7,906,468 | 9,441,870 | 10,617,681 | 10,292,587 | 10,019,160 | |||||||||||||||
Total indebtedness |
5,541,148 | 5,919,771 | 5,534,154 | 4,852,928 | 4,192,292 | |||||||||||||||
Total equity |
1,534,703 | 1,646,749 | 2,048,546 | 2,650,182 | 3,060,969 | |||||||||||||||
OTHER INFORMATION: |
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Dividends declared per common share |
$ | 0.40 | $ | 7.48 | $ | 4.31 | $ | 2.40 | $ | 3.00 | ||||||||||
Total consolidated properties (end of period) |
426 | 514 | 657 | 703 | 619 | |||||||||||||||
Total consolidated apartment units (end of period). |
95,202 | 117,719 | 153,758 | 162,432 | 158,548 | |||||||||||||||
Total unconsolidated properties (end of period) |
77 | 85 | 94 | 102 | 264 | |||||||||||||||
Total unconsolidated apartment units (end of
period) |
8,478 | 9,613 | 10,878 | 11,791 | 35,269 | |||||||||||||||
Units managed (end of period) (6) |
31,974 | 35,475 | 38,404 | 42,190 | 46,667 |
(1) | Certain reclassifications have been made to conform to the September 30, 2010
financial statement presentation, including retroactive adjustments to reflect additional
properties sold or classified as held for sale as of September 30, 2010, as discontinued
operations (see Note 13 to the consolidated financial statements in Item 8), and
retroactive adjustments related to our January 1, 2009 adoption of the provisions of
Financial Accounting Standards Board, or FASB, Statement of Financial Accounting Standards
No. 141(R), or SFAS 141(R), FASB Statement of Financial Accounting Standards No. 160, or
SFAS 160, and FASB Staff Position No. EITF 03-6-1, or FSP EITF 03-6-1 (see Note 2 to the
consolidated financial statements in Item 8). |
|
(2) | The consolidated statement of income for the year ended December 31, 2008, has been
restated to reclassify impairment losses on real estate development assets within operating
income. The reclassification reduced operating income by $91.1 million for the year ended
December 31, 2008, and had no effect on the reported amounts of loss from continuing
operations, net income, net income available to the Partnerships common unitholders or
earnings per unit. Additionally, the reclassification had no effect on the consolidated
balance sheets, statements of partners capital or statements of cash flows. See Note 2 to
the consolidated financial statements in Item 8. |
|
(3) | Total operating expenses, operating income and loss from continuing operations for the
year ended December 31, 2008, include a $91.1 million pre-tax provision for impairment
losses on real estate development assets, which is discussed further in Managements
Discussion and Analysis of Financial Condition and Results of Operations in Item 7. |
1
(4) | Income from discontinued operations for the years ended December 31, 2009, 2008, 2007,
2006 and 2005 includes $221.8 million, $800.3 million, $117.6 million, $337.1 million and
$162.7 million in gains on disposition of real estate, respectively. Income from
discontinued operations for 2009, 2008 and 2007 is discussed further in Managements
Discussion and Analysis of Financial Condition and Results of Operations in Item 7. |
|
(5) | Weighted average common shares, common share equivalents, dilutive preferred securities
and earnings per share amounts for each of the periods presented above have been adjusted
for our application during the fourth quarter 2009 of a change in accounting,
which requires the shares issued in our special dividends paid in 2008 and January 2009 to
be treated as issued and outstanding on the dividend payment dates for basic purposes and
as potential share equivalents for the periods between the ex-dividend dates and payment
dates for diluted purposes, rather than treating the shares as issued and outstanding as of
the beginning of the earliest period presented for both basic and diluted purposes. See
Note 2 to the consolidated financial statements in Item 8 for further discussion of this
accounting change. |
|
(6) | Units managed represents units in properties for which we provide asset management
services only, although in certain cases we may indirectly own generally less than one
percent of the economic interest in such properties through a partnership syndication or
other fund. |
Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
Executive Overview
We are a self-administered and self-managed real estate investment trust, or REIT, engaged in
the acquisition, ownership, management and redevelopment of apartment properties. Our property
operations are characterized by diversification of product, location and price point. We primarily
invest in the 20 largest U.S. markets, as measured by total market capitalization, which is the
total market value of institutional-grade apartment properties in a particular market. We define
these markets as target markets and they possess the following characteristics: a high
concentration of population and apartment units; geographic and employment diversification; and
historically strong returns with reduced volatility as part of a diversified portfolio. We are one
of the largest owners and operators of apartment properties in the United States. As of December
31, 2009, we owned or managed 870 apartment properties containing 135,654 units located in 44
states, the District of Columbia and Puerto Rico. Our primary sources of income and cash are rents
associated with apartment leases.
The key financial indicators that we use in managing our business and in evaluating our
financial condition and operating performance are: NAV; Funds From Operations, or FFO; Adjusted
FFO, or AFFO, which is FFO less spending for Capital Replacements; same store property operating
results; net operating income; Free Cash Flow, which is net operating income less spending for
Capital Replacements; financial coverage ratios; and leverage as shown on our balance sheet. FFO
and Capital Replacements are defined and further described in the sections captioned Funds From
Operations and Capital Additions below. The key macro-economic factors and non-financial
indicators that affect our financial condition and operating performance are: household formations;
rates of job growth; single-family and multifamily housing starts; interest rates; and availability
and cost of financing.
Because our operating results depend primarily on income from our properties, the supply and
demand for apartments influences our operating results. Additionally, the level of expenses
required to operate and maintain our properties and the pace and price at which we redevelop,
acquire and dispose of our apartment properties affect our operating results. Our cost of capital
is affected by the conditions in the capital and credit markets and the terms that we negotiate for
our equity and debt financings.
During the challenging financial and economic environment in 2009, we focused on: serving and
retaining residents; continually improving our portfolio; reducing leverage and financial risk; and
simplifying our business model.
We are focused on owning and operating B/B+ quality apartments concentrated in our target
markets. We intend to upgrade the quality of our portfolio through the sale of approximately 5% to
10% of our portfolio annually, with the proceeds generally used to increase our allocation of
capital to well located properties within our target markets through capital investments,
redevelopment or acquisitions.
The following discussion and analysis of the results of our operations and financial condition
should be read in conjunction with the accompanying consolidated financial statements in Item 8.
2
Results of Operations
Overview
2009 compared to 2008
We reported net loss attributable to Aimco of $64.3 million and net loss attributable to Aimco
common stockholders of $114.8 million for the year ended December 31, 2009, compared to net income
attributable to Aimco of $412.0 million and net income attributable to Aimco common stockholders of
$351.3 million for the year ended December 31, 2008, decreases of $476.3 million and $466.1
million, respectively. These decreases were principally due to the following items, all of which
are discussed in further detail below:
| a decrease in income from discontinued operations, primarily related to our sale of
fewer assets in 2009 and the recognition of lower gains on sales as compared to 2008; |
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| a decrease in gain on dispositions of unconsolidated real estate and other, primarily
due to a large gain on the sale of an interest in an unconsolidated real estate partnership
in 2008; |
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| an increase in depreciation and amortization expense, primarily related to completed
redevelopments and capital additions placed in service for partial periods during 2008 or
2009; and |
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| a decrease in asset management and tax credit revenues, primarily due to a reduction in
promote income, which is income earned in connection with the disposition of properties
owned by our consolidated joint ventures. |
The effects of these items on our operating results were partially offset by:
| a decrease in earnings allocable to noncontrolling interests, primarily due to a
decrease in the noncontrolling interests share of the decrease in gains on sales discussed
above; |
||
| a decrease in general and administrative expenses, primarily related to reductions in
personnel and related expenses from our organizational restructuring activities during 2008
and 2009; and |
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| impairment losses on real estate development assets in 2008, for which no similar
impairments were recognized in 2009. |
2008 compared to 2007
We reported net income attributable to Aimco of $412.0 million and net income attributable to
Aimco common stockholders of $351.3 million for the year ended December 31, 2008, compared to net
income attributable to Aimco of $29.9 million and net loss attributable to Aimco common
stockholders of $40.6 million for the year ended December 31, 2007, increases of $382.1 million and
$391.9 million, respectively. These increases were principally due to the following items, all of
which are discussed in further detail below:
| an increase in income from discontinued operations, primarily related to an increase in
the number of assets sold during 2008 and our recognition of higher gains on sales as
compared to 2007; |
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| an increase in gain on dispositions of unconsolidated real estate and other, primarily
due to a large gain on the sale of an interest in an unconsolidated real estate partnership
in 2008; |
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| an increase in net operating income associated with property operations, reflecting
improved operations of our same store properties and other properties; and |
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| an increase in asset management and tax credit revenues, primarily due to an increase in
promote income, which is income earned in connection with the disposition of properties
owned by our consolidated joint ventures. |
The effects of these items on our operating results were partially offset by:
| impairment losses on real estate development assets in 2008, for which no similar
impairments were recognized in 2007; |
||
| an increase in earnings allocable to noncontrolling interests, primarily due to an
increase in the noncontrolling interests share of the increase in gains on sales discussed
above; |
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| an increase in depreciation and amortization expense, primarily related to completed
redevelopments placed in service for partial periods during 2007 or 2008; |
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| restructuring costs recognized during the fourth quarter of 2008; and |
3
| an increase in provisions for losses on notes receivable, primarily due to the
impairment during 2008 of our interest in Casden Properties LLC. |
The following paragraphs discuss these and other items affecting the results of our operations
in more detail.
Business Segment Operating Results
As of December 31, 2009, we had two reportable segments: real estate (owning, operating and
redeveloping apartments) and investment management (portfolio management and asset management).
Based on a planned reduction in our transactional activities, during the three months ended March
31, 2010, we reevaluated our reportable segments and determined our investment management reporting
unit no longer meets the requirements for a reportable segment. Additionally, to provide more
meaningful information regarding our real estate operations, we elected to disaggregate information
for the prior real estate segment. Following these changes, we have two reportable segments:
conventional real estate operations and affordable real estate operations, which are discussed in
further detail below.
Real Estate Operations
Our real estate portfolio is comprised of two business components: conventional real estate
operations and affordable real estate operations, which also represent our two reportable segments.
Our conventional real estate portfolio consists of market-rate apartments with rents paid by the
resident and includes 226 properties with 70,758 units. Our affordable real estate portfolio
consists of 244 properties with 28,034 units, with rents that are generally paid, in whole or part,
by a government agency. Our conventional and affordable properties contributed 87% and 13%,
respectively, of our property net operating income attributed to the Partnerships common
unitholders during the year ended December 31, 2009.
Our chief operating decision maker uses various generally accepted industry financial measures
to assess the performance and financial condition of the business, including: net operating income;
Net Asset Value; Pro forma Funds From Operations; Adjusted Funds From Operations; same store
property operating results; Free Cash Flow; financial coverage ratios; and leverage as shown on our
balance sheet. Our chief operating decision maker emphasizes net operating income as a key
measurement of segment profit or loss. Segment net operating income is generally defined as
segment revenues less direct segment operating expenses.
The following table summarizes the net operating income of our real estate operations,
including our conventional and affordable segments, for the years ended December 31, 2009, 2008 and
2007 (in thousands):
Year Ended | ||||||||||||
December 31, | ||||||||||||
2009 | 2008 | 2007 | ||||||||||
Rental and other property revenues: |
||||||||||||
Conventional real estate operations |
$ | 909,218 | $ | 913,793 | $ | 882,545 | ||||||
Affordable real estate operations |
187,583 | 180,456 | 168,885 | |||||||||
Corporate and amounts not allocated |
5,082 | 6,344 | 6,924 | |||||||||
Total |
1,101,883 | 1,100,593 | 1,058,354 | |||||||||
Property operating expenses: |
||||||||||||
Conventional real estate operations |
363,863 | 360,479 | 354,455 | |||||||||
Affordable real estate operations |
92,416 | 91,867 | 83,126 | |||||||||
Corporate and amounts not allocated |
59,469 | 74,870 | 69,822 | |||||||||
Total |
515,748 | 527,216 | 507,403 | |||||||||
Real estate operations net operating income |
$ | 586,135 | $ | 573,377 | $ | 550,951 | ||||||
For the year ended December 31, 2009, compared to the year ended December 31, 2008, our real
estate operations net operating income increased $12.8 million, or 2.2%, due to an increase in
rental and other property revenues of $1.3 million, or 0.1%, and a decrease in property operating
expenses of $11.5 million, or 2.2%.
4
Our conventional real estate operations net operating income decreased $8.0 million, or 1.4%,
from $553.3 million during the year ended December 31, 2008 to $545.3 million during the year ended
December 31, 2009. This decrease was primarily attributable to our conventional same store
properties, including an $10.1 million, or 1.4%, decrease in revenues due to lower average rent
(approximately $19 per unit) and a decrease of 30 basis points in average physical
occupancy, and $1.4 million increase in expenses due to increases in payroll, repairs and
maintenance, and insurance expenses, partially offset by decreases in contract services, marketing
and administrative expenses. The decrease in conventional net operating income associated with our
same store properties was partially offset by a $3.5 million increase in net operating income
associated with our conventional non-same store properties. Revenues of our conventional non-same
store properties increased $5.5 million, primarily due to an $8.1 million increase in redevelopment
revenues, primarily due to more units in service at these properties in 2009, partially offset by a
$2.0 million increase in expenses related to our non-same store properties, primarily due to
increases in real estate taxes and expenses related to properties newly consolidated in 2009.
Our affordable real estate operations net operating income increased $6.6 million, or 7.4%,
from $88.6 million during the year ended December 31, 2008, to $95.2 million during the year ended
December 31, 2009. This increase in net operating income was primarily due to increases in
revenues of our affordable properties of $7.1 million, including a $5.0 million increase primarily
due to higher average rents partially offset by lower physical occupancy, and a $2.1 million
increase related to properties that were newly consolidated in 2009.
Real estate operations net operating income includes property management revenues and expenses
and casualty losses, which we do not allocate to our conventional or affordable segments for
purposes of evaluating segment performance. Property management revenues decreased by $1.3
million, due to a reduction in the number of properties managed due to sales. Expenses not
allocated to our conventional or affordable segments decreased by $15.4 million, primarily due to a
$16.6 million decrease in property management expenses, resulting primarily from reductions in
personnel and related costs attributed to our restructuring activities (see Note 3 to the
consolidated financial statements in Item 8).
For the year ended December 31, 2008, compared to the year ended December 31, 2007, our real
estate operations net operating income increased $22.4 million, or 4.1%, due to an increase in
rental and other property revenues of $42.2 million, or 4.0%, partially offset by an increase in
property operating expenses of $19.8 million, or 3.9%.
Our conventional real estate operations net operating income increased $25.2 million, or 4.8%,
from $528.1 million during the year ended December 31, 2007 to $553.3 million during the year ended
December 31, 2008. This increase was primarily attributable to our conventional same store
properties, including a $22.2 million, or 3.1%, increase in revenues due to higher average rent
(approximately $21 per unit) and an increase of 80 basis points in average physical occupancy,
partially offset by a $1.7 million increase in expenses due to increases in utility, real estate
tax, marketing, administrative and contract service expenses, offset by decreases in payroll,
turnover and repair and maintenance expenses. In addition to the increase in conventional same
store net operating income, net operating income related to our conventional non-same store
properties increased by $4.7 million. Revenues of our conventional non-same store properties
increased $9.0 million, primarily due to a $6.5 million increase in redevelopment revenues due to
more units in service during 2008, partially offset by a $4.3 million increase in expenses of our
conventional non-same store properties primarily due to increases in payroll, real estate tax,
contract services and marketing expenses.
Our affordable real estate operations net operating income increased $2.8 million, or 3.3%,
from $85.8 million during the year ended December 31, 2007, to $88.6 million during the year ended
December 31, 2008. Revenues of our affordable properties increased by $11.5 million and expenses
of our affordable properties increased by $8.7 million, primarily due to properties newly
consolidated during late 2007.
Real estate operations net operating income includes property management revenues and expenses
and casualty losses, which we do not allocate to our conventional or affordable segments for
purposes of evaluating segment performance. Property management revenues decreased by $0.6
million, primarily attributable to a reduction in the number of properties managed due to sales.
Expenses not allocated to our conventional or affordable segments increased by $5.0 million,
primarily due to a $2.8 million increase in casualty losses, primarily due to properties damaged by
Tropical Storm Fay and Hurricane Ike in 2008, and a $2.2 million increase in property management
expenses.
Asset Management and Tax Credit Revenues
We perform activities and services for consolidated and unconsolidated real estate
partnerships, including portfolio strategy, capital allocation, joint ventures, tax credit
syndication, acquisitions, dispositions and other transaction activities. Within our owned
portfolio, we refer to these activities as Portfolio Management, and their benefit is seen in
property operating results and in gains on dispositions. For affiliated partnerships, we refer to
these activities as asset management, for which we are separately compensated through fees paid by
third party investors. These activities are conducted in part by our taxable subsidiaries, and the
related net operating income may be subject to income taxes.
5
Asset management revenue may include certain fees that were earned in a prior period, but not
recognized at that time because collectibility was not reasonably assured. Those fees may be
recognized in a subsequent period upon occurrence of a transaction or a high level of the
probability of occurrence of a transaction, or improvement in operations that generates sufficient
cash to pay the fees.
For the year ended December 31, 2009, compared to the year ended December 31, 2008, asset
management and tax credit revenues decreased $49.0 million. This decrease is primarily
attributable to a $42.8 million decrease in promote income, which is income earned in connection
with the disposition of properties owned by our consolidated joint ventures, due to fewer related
sales in 2009, a $7.6 million decrease in other general partner transactional fees and a $2.2
million decrease in asset management fees, offset by a $3.6 million increase in revenues associated
with our affordable housing tax credit syndication business, including syndication fees and other
revenue earned in connection with these arrangements.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, asset
management and tax credit revenues increased $25.1 million. This increase is primarily
attributable to a $30.7 million increase in promote income, which is income earned in connection
with the disposition of properties owned by our consolidated joint ventures, and a $10.3 million
increase in other general partner transactional fees. These increases are offset by a decrease of
$10.0 million in asset management fees and a decrease of $5.9 million in revenues associated with
our affordable housing tax credit syndication business, including syndication fees and other
revenue earned in connection with these arrangements.
Investment Management Expenses
Investment management expenses consist primarily of the costs of departments that perform
asset management and tax credit activities. For the year ended December 31, 2009, compared to the
year ended December 31, 2008, investment management expenses decreased $9.0 million, primarily due
to reductions in personnel and related costs from our organizational restructurings and a reduction
in transaction costs related to our retroactive adoption of SFAS 141(R) (see Note 2 to the
consolidated financial statements in Item 8).
For the year ended December 31, 2008, compared to the year ended December 31, 2007, investment
management expenses increased $4.3 million, primarily due to a $3.5 million increase in acquisition
costs.
Other Operating Expenses (Income)
Depreciation and Amortization
For the year ended December 31, 2009, compared to the year ended December 31, 2008,
depreciation and amortization increased $50.8 million, or 13.3%. This increase primarily consists
of depreciation related to properties acquired during the latter part of 2008, completed
redevelopments and other capital projects recently placed in service.
For the year ended December 31, 2008, compared to the year ended December 31, 2007,
depreciation and amortization increased $45.3 million, or 13.4%. This increase reflects
depreciation of $65.1 million for newly acquired properties, completed redevelopments and other
capital projects recently placed in service. This increase was partially offset by a decrease of
$25.7 million in depreciation adjustments necessary to reduce the carrying amount of buildings and
improvements to their estimated disposition value, or zero in the case of a planned demolition,
primarily due to a property that became fully depreciated during 2007.
Provision for Operating Real Estate Impairment Losses
Real estate and other long-lived assets to be held and used are stated at cost, less
accumulated depreciation and amortization, unless the carrying amount of the asset is not
recoverable. If events or circumstances indicate that the carrying amount of a property may not be
recoverable, we make an assessment of its recoverability by comparing the carrying amount to our
estimate of the undiscounted future cash flows, excluding interest charges, of the property. If
the carrying amount exceeds the estimated aggregate undiscounted future cash flows, we recognize an
impairment loss to the extent the carrying amount exceeds the estimated fair value of the property.
For the years ended December 31, 2009 and 2007, we recognized impairment losses of $2.3
million and $1.1 million, respectively, related to properties classified as held for use as of
December 31, 2009. We recognized no such impairment losses during the year ended December 31, 2008.
6
Provision for Impairment Losses on Real Estate Development Assets
In connection with the preparation of our 2008 annual financial statements, we assessed the
recoverability of our investment in our Lincoln Place property, located in Venice, California.
Based upon the decline in land values in Southern California during 2008 and the expected timing of
our redevelopment efforts, we determined that the total carrying amount of the property was no
longer probable of full recovery and, accordingly, during the three months ended December 31, 2008,
recognized an impairment loss of $85.4 million ($55.6 million net of tax).
Similarly, we assessed the recoverability of our investment in Pacific Bay Vistas (formerly
Treetops), a vacant property located in San Bruno, California, and determined that the carrying
amount of the property was no longer probable of full recovery and, accordingly, we recognized an
impairment loss of $5.7 million for this property during the three months ended December 31, 2008.
The impairments discussed above totaled $91.1 million and are included in provisions for
impairment losses on real estate development assets in our consolidated statement of income for the
year ended December 31, 2009 included in Item 8. We recognized no similar impairments on real
estate development assets during the years ended December 31, 2009 or 2007.
General and Administrative Expenses
For the year ended December 31, 2009, compared to the year ended December 31, 2008, general
and administrative expenses decreased $23.7 million, or 29.5%. This decrease is primarily
attributable to reductions in personnel and related expenses associated with our organizational
restructurings (see Note 3 to the consolidated financial statements in Item 8), pursuant to which
we eliminated approximately 400, or 36%, of our offsite positions between December 31, 2008 and
December 31, 2009.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, general
and administrative expenses increased $8.0 million, or 11.1%. This increase is primarily
attributable to higher personnel and related expenses of $6.1 million and an increase of $1.5
million in information technology communications costs.
Other Expenses, Net
Other expenses, net includes franchise taxes, risk management activities, partnership
administration expenses and certain non-recurring items.
For the year ended December 31, 2009, compared to the year ended December 31, 2008, other
expenses, net decreased by $6.3 million. The decrease is primarily attributable to a $5.4 million
write-off during 2008 of certain communications hardware and capitalized costs in 2008, and a $5.3
million reduction in expenses of our self insurance activities, including a decrease in casualty
losses on less than wholly owned properties from 2008 to 2009. These decreases are partially offset
by an increase of $4.8 million in costs related to certain litigation matters.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, other
expenses, net increased by $3.1 million. The increase includes a $5.4 million write-off of certain
communications hardware and capitalized costs during 2008 and a $1.2 million write-off of
redevelopment costs associated with a change in the planned use of a property during 2008. The net
unfavorable change also reflects $3.6 million of income recognized in 2007 related to the transfer
of certain property rights to an unrelated party. These increases were partially offset by a $3.7
million reduction in expenses of our self insurance activities (net of costs in 2008 related to
Tropical Storm Fay and Hurricane Ike) and a net decrease of $2.0 million in costs related to
certain litigation matters.
Restructuring Costs
For the year ended December 31, 2009, we recognized restructuring costs of $11.2 million, as
compared to $22.8 million in the year ended December 31, 2008, related to our organizational
restructurings, which are further discussed in Note 3 to the consolidated financial statements in
Item 8. We recognized no restructuring costs during the year ended December 31, 2007.
Interest Income
Interest income consists primarily of interest on notes receivable from non-affiliates and
unconsolidated real estate partnerships, interest on cash and restricted cash accounts, and
accretion of discounts on certain notes receivable from
unconsolidated real estate partnerships. Transactions that result in accretion occur
infrequently and thus accretion income may vary from period to period.
7
For the year ended December 31, 2009, compared to the year ended December 31, 2008, interest
income decreased $10.5 million, or 53.7%. Interest income decreased by $8.7 million due to lower
interest rates on notes receivable, cash and restricted cash balances and lower average balances
and by $4.1 million due to a decrease in accretion income related to our note receivable from
Casden Properties LLC for which we ceased accretion following impairment of the note in 2008. These
decreases were partially offset by a $2.3 million increase in accretion income related to other
notes during the year ended December 31, 2008, resulting from a change in the timing and amount of
collection.
For the year ended December 31, 2008, as compared to the year ended December 31, 2007,
interest income decreased $23.2 million, or 54.1%. Interest income decreased by $15.9 million due
to lower interest rates on notes receivable, cash and restricted cash balances and lower average
balances. Interest income also decreased by $5.8 million due to an adjustment of accretion on
certain discounted notes during the year ended December 31, 2008, resulting from a change in the
estimated timing and amount of collection, and by $1.5 million for accretion income recognized
during the year ended December 31, 2007, related to the prepayment of principal on certain
discounted loans collateralized by properties in West Harlem in New York City.
Provision for Losses on Notes Receivable
During the years ended December 31, 2009, 2008 and 2007, we recognized net provisions for
losses on notes receivable of $21.5 million, $17.6 million and $2.0 million, respectively. The
provisions for losses on notes receivable for the years ended December 31, 2009 and 2008, primarily
consist of impairments related to our investment in Casden Properties LLC, which are discussed
further below.
As part of the March 2002 acquisition of Casden Properties, Inc., we invested $50.0 million
for a 20% passive interest in Casden Properties LLC, an entity organized to acquire, re-entitle and
develop land parcels in Southern California. Based upon the profit allocation agreement, we
account for this investment as a note receivable and through 2008 were amortizing the discounted
value of the investment to the $50.0 million previously estimated to be collectible, through
January 2, 2009, the initial dissolution date of the entity. In 2009, the managing member extended
the dissolution date. In connection with the preparation of our 2008 annual financial statements
and as a result of a decline in land values in Southern California, we determined our recorded
investment amount was not fully recoverable, and accordingly recognized an impairment loss of $16.3
million ($10.0 million net of tax) during the three months ended December 31, 2008. In connection
with the preparation of our 2009 annual financial statements and as a result of continued declines
in land values in Southern California, we determined our then recorded investment amount was not
fully recoverable, and accordingly recognized an impairment loss of $20.7 million ($12.4 million
net of tax) during the three months ended December 31, 2009.
In addition to the impairments related to Casden Properties LLC discussed above, we recognized
provisions for losses on notes receivable totaling $0.8 million, $1.3 million and $2.0 million
during the years ended December 31, 2009, 2008 and 2007, respectively.
Interest Expense
For the years ended December 31, 2009 and December 31, 2008, interest expense, which includes
the amortization of deferred financing costs, totaled $315.4 million and $315.0 million,
respectively. Interest expense increased by $14.5 million due to a reduction in redevelopment
activity during 2009, which resulted in a reduction in capitalized interest. In addition, interest
expense increased by $1.2 million due to an increase in prepayment penalties associated with
refinancing activities, from $2.8 million in 2008 to $4.0 million in 2009, and by $4.0 million
related to non-recourse property loans, from $301.9 million to $305.9 million, primarily due to
higher average interest rates partially offset by lower average balances during 2009. These
increases in interest expense were substantially offset by decreases in corporate interest expense.
Interest expense related to corporate debt, which is primarily floating rate, decreased by $19.4
million, from $34.8 million to $15.4 million, primarily due to lower average balances and interest
rates during 2009.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, interest
expense increased $10.3 million, or 3.4%. Interest expense related to non-recourse property loans
increased by $16.2 million, from $285.7 million to $301.9 million, primarily due to higher average
balances partially offset by lower average interest rates during 2008. In addition, interest
expense increased by $4.6 million, due to a decrease in capitalized interest from $29.1 million in
2007 to $24.5 million in 2008, resulting from more units in service and lower interest rates.
These increases
were partially offset by a decrease in interest expense related to corporate debt, which is
primarily floating rate and which decreased by $10.4 million, from $45.2 million to $34.8 million,
primarily due to lower average balances and interest rates during 2008.
8
Equity in Losses of Unconsolidated Real Estate Partnerships
Equity in losses of unconsolidated real estate partnerships includes our share of net losses
of our unconsolidated real estate partnerships and is primarily driven by depreciation expense in
excess of the net operating income recognized by such partnerships.
During the years ended December 31, 2009, 2008 and 2007, we recognized equity in losses of
unconsolidated real estate partnerships of $12.0 million, $4.6 million and $3.3 million,
respectively. The $7.4 million increase in our equity in losses from 2008 to 2009 was primarily
due to our sale in late 2008 of an interest in an unconsolidated real estate partnership that
generated $3.0 million of equity in earnings during the year ended December 31, 2008, and our sale
during 2009 of our interest in an unconsolidated group purchasing organization which resulted in a
decrease of equity in earnings of approximately $1.2 million. The increase in equity in losses
also includes additional losses recognized during 2009 related to the underlying investment
properties of certain tax credit syndications we consolidated during 2009 and 2008.
Impairment Losses Related to Unconsolidated Real Estate Partnerships
Impairment losses related to unconsolidated real estate partnerships includes our share of
impairment losses recognized by our unconsolidated real estate partnerships. For the year ended
December 31, 2009, compared to the year ended December 31, 2008, impairment losses related to
unconsolidated real estate partnerships decreased $2.3 million, and for the year ended December 31,
2008, compared to the year ended December 31, 2007, impairment losses related to unconsolidated
real estate partnerships increased $2.7 million. This decrease and increase are primarily
attributable to impairment losses recognized by unconsolidated partnerships on their underlying
real estate properties during 2008.
Gain on Dispositions of Unconsolidated Real Estate and Other
Gain on dispositions of unconsolidated real estate and other includes our share of gains
related to dispositions of real estate by unconsolidated real estate partnerships, gains on
disposition of interests in unconsolidated real estate partnerships, gains on dispositions of land
and other non-depreciable assets and costs related to asset disposal activities. Changes in the
level of gains recognized from period to period reflect the changing level of disposition activity
from period to period. Additionally, gains on properties sold are determined on an individual
property basis or in the aggregate for a group of properties that are sold in a single transaction,
and are not comparable period to period.
For the year ended December 31, 2009, compared to the year ended December 31, 2008, gain on
dispositions of unconsolidated real estate and other decreased $77.4 million. This decrease is
primarily attributable to a gain of $98.4 million on our disposition in 2008 of interests in two
unconsolidated real estate partnerships. This decrease was partially offset by $18.7 million of
gains on the disposition of interests in unconsolidated partnerships during 2009. Gains recognized
in 2009 consist of $8.6 million related to our receipt in 2009 of additional proceeds related to
our disposition during 2008 of one of the partnership interests discussed above (see Note 3 to the
consolidated financials statements in Item 8), $4.0 million from the disposition of our interest in
a group purchasing organization (see Note 3 to the consolidated financial statements in Item 8),
and $6.1 million from our disposition in 2009 of interests in unconsolidated real estate
partnerships.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, gain on
dispositions of unconsolidated real estate and other increased $76.5 million. This increase is
primarily attributable to a $98.4 million net gain on the disposition of interests in two
unconsolidated real estate partnerships during the year ended December 31, 2008. During 2007, we
recognized a $6.0 million non-refundable option and extension fee resulting from the termination of
rights under an option agreement to sell the North and Central towers of our Flamingo South Beach
property, approximately $6.4 million of net gains on dispositions of land parcels and our share of
gains on dispositions of properties by unconsolidated real estate partnerships in 2007, and a $9.5
million gain on debt extinguishment related to properties in the VMS partnership (see Note 3 to the
consolidated financial statements in Item 8).
9
Income Tax Benefit
Certain of our operations or a portion thereof, such as property management, asset management
and risk management, are conducted through, and certain of our properties are owned by, taxable
REIT subsidiaries, each of
which we refer to as a TRS. A TRS is a C-corporation that has not elected REIT status and, as
such, is subject to United States Federal corporate income tax. We use TRS entities to facilitate
our ability to offer certain services and conduct certain activities that generally cannot be
offered directly by the REIT. We also use TRS entities to hold investments in certain properties.
Income taxes related to the results of continuing operations of our TRS entities are included in
income tax benefit in our consolidated statements of income.
For the year ended December 31, 2009, compared to the year ended December 31, 2008, income tax
benefit decreased by $34.5 million. This decrease was primarily attributed to $36.1 million of
income tax benefit recognized in 2008 related to the impairments of our Lincoln Place property and
our investment in Casden Properties LLC, both of which are owned through TRS entities, partially
offset by $8.1 million of income tax benefit recognized in 2009 related to the impairment of our
investment in Casden Properties LLC.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, income tax
benefit increased by $33.4 million. This increase was primarily attributed to $36.1 million of
income tax benefit recognized in 2008 related to the impairments of our Lincoln Place property and
our investment in Casden Properties LLC.
Income from Discontinued Operations, Net
The results of operations for properties sold during the period or designated as held for sale
at the end of the period are generally required to be classified as discontinued operations for all
periods presented. The components of net earnings that are classified as discontinued operations
include all property-related revenues and operating expenses, depreciation expense recognized prior
to the classification as held for sale, property-specific interest expense and debt extinguishment
gains and losses to the extent there is secured debt on the property. In addition, any impairment
losses on assets held for sale and the net gain or loss on the eventual disposal of properties held
for sale are reported in discontinued operations.
For the years ended December 31, 2009 and 2008, income from discontinued operations totaled
$153.9 million and $746.2 million, respectively. The $592.3 million decrease in income from
discontinued operations was principally due to a $541.2 million decrease in gain on dispositions of
real estate, net of income taxes, primarily attributable to fewer properties sold in 2009 as
compared to 2008, and a $111.8 million decrease in operating income (inclusive of a $27.1 million
increase in real estate impairment losses), partially offset by a $59.1 million decrease in
interest expense.
For the years ended December 31, 2008 and 2007, income from discontinued operations totaled
$746.2 million and $175.6 million, respectively. The $570.6 million increase in income from
discontinued operations was principally due to a $641.7 million increase in gain on dispositions of
real estate, net of income taxes, primarily attributable to more properties sold in 2008 as
compared to 2007 and a $27.1 million decrease in interest expense. These increases were partially
offset by a $66.7 million decrease in operating income (inclusive of a $22.0 million increase in
real estate impairment losses) and a $32.7 million decrease related to a 2007 gain on debt
extinguishment related to properties in the VMS partnership.
During the year ended December 31, 2009, we sold 89 consolidated properties for gross proceeds
of $1.3 billion and net proceeds of $432.7 million, resulting in a net gain on sale of
approximately $216.0 million (which is net of $5.8 million of related income taxes). During the
year ended December 31, 2008, we sold 151 consolidated properties for gross proceeds of $2.4
billion and net proceeds of $1.1 billion, resulting in a net gain on sale of approximately $757.2
million (which is net of $43.1 million of related income taxes). During the year ended December 31,
2007, we sold 73 consolidated properties for gross proceeds of $480.0 million and net proceeds of
$203.8 million, resulting in a net gain on sale of approximately $115.5 million (which is net of
$2.1 million of related income taxes).
For the years ended December 31, 2009, 2008 and 2007, income from discontinued operations
includes the operating results of the properties sold or classified as held for sale as of
September 30, 2010.
Changes in the level of gains recognized from period to period reflect the changing level of
our disposition activity from period to period. Additionally, gains on properties sold are
determined on an individual property basis or in the aggregate for a group of properties that are
sold in a single transaction, and are not comparable period to period (see Note 13 of the
consolidated financial statements in Item 8 for additional information on discontinued operations).
10
Noncontrolling Interests in Consolidated Real Estate Partnerships
Noncontrolling interests in consolidated real estate partnerships reflects the non-Aimco
partners, or noncontrolling partners, share of operating results of consolidated real estate
partnerships. This generally includes the noncontrolling
partners share of property management fees, interest on notes and other amounts eliminated in
consolidation that we charge to such partnerships. As discussed in Note 2 to the consolidated
financial statements in Item 8, we adopted the provisions of SFAS 160, which are now codified in
the Financial Accounting Standards Boards Accounting Standards Codification, or FASB ASC, Topic
810, effective January 1, 2009. Prior to our adoption of SFAS 160, we generally did not recognize
a benefit for the noncontrolling interest partners share of partnership losses for partnerships
that have deficit noncontrolling interest balances and we generally recognized a charge to our
earnings for distributions paid to noncontrolling partners for partnerships that had deficit
noncontrolling interest balances. Under the updated provisions of FASB ASC Topic 810, we are
required to attribute losses to noncontrolling interests even if such attribution would result in a
deficit noncontrolling interest balance and we are no longer required to recognize a charge to our
earnings for distributions paid to noncontrolling partners for partnerships that have deficit
noncontrolling interest balances.
For the year ended December 31, 2009, compared to the year ended December 31, 2008, net
earnings attributed to noncontrolling interests in consolidated real estate partnerships decreased
by $133.2 million. This decrease is primarily attributable to a reduction of $108.7 million
related to the noncontrolling interests in consolidated real estate partnerships share of gains on
dispositions of real estate, due primarily to fewer sales in 2009 as compared to 2008, $5.5 million
of losses allocated to noncontrolling interests in 2009 that we would not have allocated to the
noncontrolling interest partners in 2008 because to do so would have resulted in deficits in their
noncontrolling interest balances, and approximately $3.8 million related to deficit distribution
charges recognized as a reduction to our earnings in 2008, for which we did not recognize similar
charges in 2009 based on the change in accounting discussed above. These decreases are in addition
to the noncontrolling interest partners share of increased losses of our consolidated real estate
partnerships in 2009 as compared to 2008.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, net income
attributed to noncontrolling interests in consolidated real estate partnerships increased by $63.6
million. This increase is primarily attributable to an increase of $105.6 million related to the
noncontrolling interests in consolidated real estate partnerships share of gains on dispositions
of real estate, due primarily to more sales in 2008 as compared to 2007, partially offset by
increases of $42.0 million in net recoveries of deficit distributions.
As discussed in Note 2 to the consolidated financial statements in Item 8, during the first
quarter 2010, we will adopt new accounting guidance related to accounting for variable interest
entities. This change in accounting guidance may result in our consolidation of certain previously
unconsolidated entities as well as our deconsolidation of certain we currently consolidate. At
this time, we have not yet determined the effect this accounting change will have on our
consolidated financial statements.
Noncontrolling Interests in Aimco Operating Partnership
Noncontrolling interests in Aimco Operating Partnership consist of common OP Units, High
Performance Units and preferred OP Units. We allocate the Aimco Operating Partnerships income or
loss to the holders of common OP Units and High Performance Units based on the weighted average
number of common OP Units and High Performance Units outstanding during the period. Holders of the
preferred OP Units participate in the Aimco Operating Partnerships income or loss only to the
extent of their preferred distributions.
For the year ended December 31, 2009, compared to the year ended December 31, 2008, the effect
on our earnings of income or loss attributable to noncontrolling interests in the Aimco Operating
Partnership changed favorably by $62.3 million. This favorable change is attributable to a
decrease of $51.1 million related to the noncontrolling interests in the Aimco Operating
Partnerships share of income from discontinued operations (net of noncontrolling interests in
consolidated real estate partnerships), due primarily to larger gains on sales in 2008 relative to
2009 and $11.2 million in deficit distribution charges recognized during 2008 due to distributions
in excess of the positive balance in noncontrolling interest. These changes were also affected by a
decrease in the noncontrolling interests in the Aimco Operating Partnerships effective ownership
interest from 2008 to 2009.
For the year ended December 31, 2008, compared to the year ended December 31, 2007, the effect
on our earnings of income or loss attributable to noncontrolling interests in the Aimco Operating
Partnership changed unfavorably by $55.8 million. This unfavorable change is attributable to an
increase of $48.1 million related to the noncontrolling interests in the Aimco Operating
Partnerships share of income from discontinued operations (net of noncontrolling interests in
consolidated real estate partnerships), due primarily to larger gains on sales in 2008 relative to
2007, $11.5 million in deficit distribution charges recognized during 2008 due to distributions in
excess of the positive balance in noncontrolling interest, and a $0.5 million increase in
distributions to holders of preferred OP Units. These unfavorable changes were partially offset by
a $4.3 million increase in noncontrolling interests in the Aimco Operating Partnerships
share of losses from continuing operations (net of noncontrolling interests in consolidated
real estate partnerships) in 2008 as compared to 2007.
11
Critical Accounting Policies and Estimates
We prepare our consolidated financial statements in accordance with accounting principles
generally accepted in the United States of America, or GAAP, which requires us to make estimates
and assumptions. We believe that the following critical accounting policies involve our more
significant judgments and estimates used in the preparation of our consolidated financial
statements.
Impairment of Long-Lived Assets
Real estate and other long-lived assets to be held and used are stated at cost, less
accumulated depreciation and amortization, unless the carrying amount of the asset is not
recoverable. If events or circumstances indicate that the carrying amount of a property may not be
recoverable, we make an assessment of its recoverability by comparing the carrying amount to our
estimate of the undiscounted future cash flows, excluding interest charges, of the property. If
the carrying amount exceeds the estimated aggregate undiscounted future cash flows, we recognize an
impairment loss to the extent the carrying amount exceeds the estimated fair value of the property.
From time to time, we have non-revenue producing properties that we hold for future
redevelopment. We assess the recoverability of the carrying amount of these redevelopment
properties by comparing our estimate of undiscounted future cash flows based on the expected
service potential of the redevelopment property upon completion to the carrying amount. In certain
instances, we use a probability-weighted approach to determine our estimate of undiscounted future
cash flows when alternative courses of action are under consideration. As discussed in Provision
for Impairment Losses on Real Estate Development Assets within the preceding discussion of our
Results of Operations, during 2008 we recognized impairment losses on our Lincoln Place and Pacific
Bay Vistas properties of $85.4 million ($55.6 million net of tax) and $5.7 million, respectively.
Real estate investments are subject to varying degrees of risk. Several factors may adversely
affect the economic performance and value of our real estate investments. These factors include:
| the general economic climate; |
||
| competition from other apartment communities and other housing options; |
||
| local conditions, such as loss of jobs or an increase in the supply of apartments, that
might adversely affect apartment occupancy or rental rates; |
||
| changes in governmental regulations and the related cost of compliance; |
||
| increases in operating costs (including real estate taxes) due to inflation and other
factors, which may not be offset by increased rents; |
||
| changes in tax laws and housing laws, including the enactment of rent control laws or
other laws regulating multifamily housing; and |
||
| changes in interest rates and the availability of financing. |
Any adverse changes in these and other factors could cause an impairment in our long-lived
assets, including real estate and investments in unconsolidated real estate partnerships. In
addition to the impairments of Lincoln Place and Pacific Bay Vistas discussed above, based on
periodic tests of recoverability of long-lived assets, for the years ended December 31, 2009 and
2007, we recorded net impairment losses of $2.3 million and $1.1 million, respectively, related to
properties classified as held for use, and during the year ended December 31, 2008, we recorded no
additional impairments related to properties held for use.
Notes Receivable and Interest Income Recognition
Notes receivable from unconsolidated real estate partnerships consist primarily of notes
receivable from partnerships in which we are the general partner. Notes receivable from
non-affiliates consist of notes receivable from unrelated third parties. The ultimate repayment of
these notes is subject to a number of variables, including the performance and value of the
underlying real estate and the claims of unaffiliated mortgage lenders. Our notes receivable
include loans extended by us that we carry at the face amount plus accrued interest, which we refer
to as par value notes, and loans
extended by predecessors, some of whose positions we generally acquired at a discount, which
we refer to as discounted notes.
12
We record interest income on par value notes as earned in accordance with the terms of the
related loan agreements. We discontinue the accrual of interest on such notes when the notes are
impaired, as discussed below, or when there is otherwise significant uncertainty as to the
collection of interest. We record income on such nonaccrual loans using the cost recovery method,
under which we apply cash receipts first to the recorded amount of the loan; thereafter, any
additional receipts are recognized as income.
We recognize interest income on discounted notes receivable based upon whether the amount and
timing of collections are both probable and reasonably estimable. We consider collections to be
probable and reasonably estimable when the borrower has closed transactions or has entered into
certain pending transactions (which include real estate sales, refinancings, foreclosures and
rights offerings) that provide a reliable source of repayment. In such instances, we recognize
accretion income, on a prospective basis using the effective interest method over the estimated
remaining term of the loans, equal to the difference between the carrying amount of the discounted
notes and the estimated collectible value. We record income on all other discounted notes using
the cost recovery method. Accretion income recognized in any given period is based on our ability
to complete transactions to monetize the notes receivable and the difference between the carrying
value and the estimated collectible amount of the notes; therefore, accretion income varies on a
period by period basis and could be lower or higher than in prior periods.
Provision for Losses on Notes Receivable
We assess the collectibility of notes receivable on a periodic basis, which assessment
consists primarily of an evaluation of cash flow projections of the borrower to determine whether
estimated cash flows are sufficient to repay principal and interest in accordance with the
contractual terms of the note. We recognize impairments on notes receivable when it is probable
that principal and interest will not be received in accordance with the contractual terms of the
loan. The amount of the impairment to be recognized generally is based on the fair value of the
partnerships real estate that represents the primary source of loan repayment. In certain
instances where other sources of cash flow are available to repay the loan, the impairment is
measured by discounting the estimated cash flows at the loans original effective interest rate.
During the years ended December 31, 2009, 2008 and 2007 we recorded net provisions for losses
on notes receivable of $21.5 million, $17.6 million and $2.0 million, respectively. As discussed
in Provision for Losses on Notes Receivable within the preceding discussion of our Results of
Operations, provisions for losses on notes receivable in 2009 and 2008 include impairment losses of
$20.7 million ($12.4 million net of tax) and $16.3 million ($10.0 million net of tax),
respectively, on our investment in Casden Properties LLC, which we account for as a note
receivable. We will continue to evaluate the collectibility of these notes, and we will adjust
related allowances in the future due to changes in market conditions and other factors.
Capitalized Costs
We capitalize costs, including certain indirect costs, incurred in connection with our capital
additions activities, including redevelopment and construction projects, other tangible property
improvements and replacements of existing property components. Included in these capitalized costs
are payroll costs associated with time spent by site employees in connection with the planning,
execution and control of all capital additions activities at the property level. We characterize
as indirect costs an allocation of certain department costs, including payroll, at the area
operations and corporate levels that clearly relate to capital additions activities. We capitalize
interest, property taxes and insurance during periods in which redevelopment and construction
projects are in progress. We charge to expense as incurred costs that do not relate to capital
additions activities, including ordinary repairs, maintenance, resident turnover costs and general
and administrative expenses (see Capital Additions and Related Depreciation in Note 2 to the
consolidated financial statements in Item 8).
For the years ended December 31, 2009, 2008 and 2007, for continuing and discontinued
operations, we capitalized $9.8 million, $25.7 million and $30.8 million of interest costs,
respectively, and $40.0 million, $78.1 million and $78.1 million of site payroll and indirect
costs, respectively. The reduction is primarily due to a reduced level of redevelopment
activities.
13
Funds From Operations
FFO is a non-GAAP financial measure that we believe, when considered with the financial
statements determined in accordance with GAAP, is helpful to investors in understanding our
performance because it captures features particular to real estate performance by recognizing that
real estate generally appreciates over time or maintains residual value to a much greater extent
than do other depreciable assets such as machinery, computers or other personal property. The
Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT, defines
FFO as net income (loss), computed in accordance with GAAP, excluding gains from sales of
depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated
partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures
are calculated to reflect FFO on the same basis. We compute FFO for all periods presented in
accordance with the guidance set forth by NAREITs April 1, 2002, White Paper, which we refer to as
the White Paper. We calculate FFO attributable to Aimco common stockholders (diluted) by
subtracting redemption or repurchase related preferred stock issuance costs and dividends on
preferred stock and adding back dividends/distributions on dilutive preferred securities and
premiums or discounts on preferred stock redemptions or repurchases. FFO should not be considered
an alternative to net income or net cash flows from operating activities, as determined in
accordance with GAAP, as an indication of our performance or as a measure of liquidity. FFO is not
necessarily indicative of cash available to fund future cash needs. In addition, although FFO is a
measure used for comparability in assessing the performance of REITs, there can be no assurance
that our basis for computing FFO is comparable with that of other REITs.
In addition to FFO, we compute an alternate measure of FFO, which we refer to as Proforma FFO
and which is FFO attributable to Aimco common stockholders (diluted), excluding operating real
estate impairments and preferred stock redemption related amounts (adjusted for the noncontrolling
interests). Both operating real estate impairment losses and preferred stock redemption related
amounts are recurring items that affect our operating results. We exclude operating real estate
impairment losses, net of related income tax benefits and noncontrolling interests, from our
calculation of Proforma FFO because we believe the inclusion of such losses in FFO is inconsistent
with the treatment of gains on the disposition of operating real estate, which are not included in
FFO. We exclude preferred redemption related amounts (gains or losses) from our calculation of
Proforma FFO because such amounts are not representative of our operating results. Similar to FFO,
we believe Proforma FFO is helpful to investors in understanding our performance because it
captures features particular to real estate performance by recognizing that real estate generally
appreciates over time or maintains residual value to a much greater extent than do other
depreciating assets such as machinery, computers or other personal property. Not all REITs present
an alternate measure of FFO similar to our Proforma FFO measure and there can be no assurance our
basis for calculating Proforma FFO is comparable to those of other REITs.
14
For the years ended December 31, 2009, 2008 and 2007, our FFO and Proforma FFO are calculated
as follows (in thousands):
2009 | 2008 | 2007 | ||||||||||
Net (loss) income attributable to Aimco common stockholders (1) |
$ | (114,840 | ) | $ | 351,314 | $ | (40,586 | ) | ||||
Adjustments: |
||||||||||||
Depreciation and amortization |
433,933 | 383,084 | 337,804 | |||||||||
Depreciation and amortization related to non-real estate assets |
(16,597 | ) | (17,305 | ) | (20,108 | ) | ||||||
Depreciation of rental property related to noncontrolling partners and
unconsolidated entities (2) |
(39,278 | ) | (26,695 | ) | (13,167 | ) | ||||||
Gain on dispositions of unconsolidated real estate and other, net of
noncontrolling
partners interest |
(20,615 | ) | (99,597 | ) | (22,252 | ) | ||||||
Income tax expense (benefit) arising from disposition of unconsolidated real
estate and other |
1,582 | (433 | ) | (17 | ) | |||||||
Add back portion of gain on dispositions of unconsolidated real estate and other
that relates to non-depreciable assets and debt extinguishment gain |
7,783 | 1,669 | 16,851 | |||||||||
Deficit distributions to noncontrolling partners (3) |
| 38,109 | 26,641 | |||||||||
Discontinued operations: |
||||||||||||
Gain on dispositions of real estate, net of noncontrolling partners interest
(2) |
(166,159 | ) | (618,173 | ) | (65,035 | ) | ||||||
Depreciation of rental property, net of noncontrolling partners interest (2) |
54,671 | 115,714 | 121,500 | |||||||||
(Recovery of deficit distributions) deficit distributions to noncontrolling
partners, net (3) |
| (30,783 | ) | 12,119 | ||||||||
Income tax expense arising from disposals |
5,788 | 43,146 | 2,135 | |||||||||
Noncontrolling interests in Aimco Operating Partnerships share of above
adjustments (4) |
(19,509 | ) | 21,667 | (36,830 | ) | |||||||
Preferred stock dividends |
52,215 | 55,190 | 63,381 | |||||||||
Preferred stock redemption related (gains) costs |
(1,649 | ) | (1,482 | ) | 2,635 | |||||||
Amounts allocable to participating securities (5) |
| 6,985 | 4,481 | |||||||||
FFO |
$ | 177,325 | $ | 222,410 | $ | 389,552 | ||||||
Preferred stock dividends |
(52,215 | ) | (55,190 | ) | (63,381 | ) | ||||||
Preferred stock redemption related gains (costs) |
1,649 | 1,482 | (2,635 | ) | ||||||||
Amounts allocable to participating securities (5) |
(773 | ) | (6,985 | ) | (4,481 | ) | ||||||
Dividends/distributions on dilutive preferred securities |
| 4,292 | 1,442 | |||||||||
FFO attributable to Aimco common stockholders diluted |
$ | 125,986 | $ | 166,009 | $ | 320,497 | ||||||
Operating real estate impairment losses, continuing operations, net of
noncontrolling partners interest (6) |
2,012 | 1,131 | 1,080 | |||||||||
Operating real estate impairment losses, discontinued operations, net of
noncontrolling partners interest (6) |
61,313 | 26,285 | 5,430 | |||||||||
Income tax benefit on impairment losses |
(4,075 | ) | (511 | ) | | |||||||
Preferred stock redemption related (gains) costs (7) |
(1,649 | ) | (1,482 | ) | 2,635 | |||||||
Noncontrolling interests in Aimco Operating Partnerships share of above adjustments |
(4,304 | ) | (2,474 | ) | (850 | ) | ||||||
Amounts allocable to participating securities (5) |
(448 | ) | | | ||||||||
Dividends/distributions on dilutive preferred securities |
| | 426 | |||||||||
Proforma FFO attributable to Aimco common stockholders diluted |
$ | 178,835 | $ | 188,958 | $ | 329,218 | ||||||
FFO attributable to Aimco common stockholders diluted |
||||||||||||
Weighted average number of common shares, common share equivalents and dilutive
preferred securities outstanding (8): |
||||||||||||
Common shares and equivalents (9) |
115,563 | 89,827 | 97,055 | |||||||||
Dilutive preferred securities |
| 1,490 | 457 | |||||||||
Total |
115,563 | 91,317 | 97,512 | |||||||||
Proforma FFO attributable to Aimco common stockholders diluted |
||||||||||||
Weighted average number of common shares, common share equivalents and dilutive
preferred securities outstanding (8): |
||||||||||||
Common shares and equivalents (9) |
115,563 | 89,827 | 97,055 | |||||||||
Dilutive preferred securities |
| 1,490 | 580 | |||||||||
Total |
115,563 | 91,317 | 97,635 | |||||||||
15
Notes:
(1) | Represents the numerator for calculating basic earnings per common share in accordance
with GAAP (see Note 14 to the consolidated financial statements in Item 8). |
|
(2) | Noncontrolling partners refers to noncontrolling partners in our consolidated real
estate partnerships. |
|
(3) | Prior to adoption of SFAS 160 (see Note 2 to the consolidated financial statements in
Item 8), we recognized deficit distributions to noncontrolling partners as charges in our
income statement when cash was distributed to a noncontrolling partner in a consolidated
partnership in excess of the positive balance in such partners noncontrolling interest
balance. We recorded these charges for GAAP purposes even though there was no economic
effect or cost. Deficit distributions to noncontrolling partners occurred when the fair
value of the underlying real estate exceeded its depreciated net book value because the
underlying real estate had appreciated or maintained its value. As a result, the
recognition of expense for deficit distributions to noncontrolling partners represented, in
substance, either (a) our recognition of depreciation previously allocated to the
noncontrolling partner or (b) a payment related to the noncontrolling partners share of
real estate appreciation. Based on White Paper guidance that requires real estate
depreciation and gains to be excluded from FFO, we added back deficit distributions and
subtracted related recoveries in our reconciliation of net income to FFO. Subsequent to our
adoption of SFAS 160, effective January 1, 2009, we may reduce the balance of
noncontrolling interests below zero in such situations and we are no longer required to
recognize such charges in our income statement. |
|
(4) | During the years ended December 31, 2009, 2008 and 2007, the Aimco Operating
Partnership had 6,534,140, 7,191,199, and 7,367,400 common OP Units outstanding and
2,344,719, 2,367,629 and 2,379,084 High Performance Units outstanding. |
|
(5) | Amounts allocable to participating securities represent dividends declared and any
amounts of undistributed earnings allocable to participating securities. See Note 2 and
Note 14 to the consolidated financial statements in Item 8 for further information
regarding participating securities. |
|
(6) | On October 1, 2003, NAREIT clarified its definition of FFO to include operating real
estate impairment losses, which previously had been added back to calculate FFO. Although
Aimcos presentation conforms with the NAREIT definition, Aimco considers such approach to
be inconsistent with the treatment of gains on dispositions of operating real estate, which
are not included in FFO. |
|
(7) | In accordance with the Securities and Exchange Commissions July 31, 2003
interpretation of the Emerging Issues Task Force Topic D-42, Aimco includes preferred stock
redemption related charges or gains in FFO. As a result, FFO for the years ended December
31, 2009, 2008 and 2007 includes redemption discounts, net of issuance costs, of $1.6
million and $1.5 million and a redemption premium of $2.6 million, respectively. |
|
(8) | Weighted average common shares, common share equivalents, dilutive preferred securities
for each of the periods presented above have been adjusted for our application during the
fourth quarter 2009 of a change in GAAP, which requires the shares issued in our special
dividends paid in 2008 and January 2009 to be treated as issued and outstanding on the
dividend payment dates for basic purposes and as potential share equivalents for the
periods between the ex-dividend dates and the payment dates for diluted purposes, rather
than treating the shares as issued and outstanding as of the beginning of the earliest
period presented for both basic and diluted purposes. The change in accounting treatment
had no effect on diluted weighted average shares outstanding for the year ended December
31, 2009. The change in accounting treatment reduced diluted weighted average shares
outstanding by 32.7 million and 46.5 million for the years ended December 31, 2008 and
2007, respectively. |
|
(9) | Represents the denominator for earnings per common share diluted, calculated in
accordance with GAAP, plus common share equivalents that are dilutive for FFO. |
Liquidity and Capital Resources
Liquidity is the ability to meet present and future financial obligations. Our primary source
of liquidity is cash flow from our operations. Additional sources are proceeds from property sales
and proceeds from refinancings of existing property loans and borrowings under new property loans.
Our principal uses for liquidity include normal operating activities, payments of principal
and interest on outstanding debt, capital additions, dividends paid to stockholders and
distributions paid to noncontrolling interest partners, repurchases of shares of our Common Stock,
and acquisitions of, and investments in, properties. We use our cash and cash equivalents and our
cash provided by operating activities to meet short-term liquidity needs. In the event that our
cash and cash equivalents and cash provided by operating activities are not sufficient to cover our
short-term liquidity demands, we have additional means, such as short-term borrowing availability
and proceeds from property sales and refinancings, to help us meet our short-term liquidity
demands. We may use our revolving credit facility for general corporate purposes and to fund
investments on an interim basis. We expect to meet our long-term liquidity requirements, such as
debt maturities and property acquisitions, through long-term borrowings, primarily secured, the
issuance of equity securities (including OP Units), the sale of properties and cash generated from
operations.
16
The state of credit markets and related effect on the overall economy may have an adverse
affect on our liquidity, both through increases in interest rates and credit risk spreads, and
access to financing. As further discussed in Item 7A, Quantitative and Qualitative Disclosures
About Market Risk, we are subject to interest rate risk associated with certain variable rate
liabilities, preferred stock and assets. Based on our net variable rate liabilities, preferred
stock and assets outstanding at December 31, 2009, we estimate that a 1.0 % increase in 30-day
LIBOR with constant credit risk spreads would reduce our income attributable to Aimco common
stockholders by approximately $1.5 million on an annual basis. Although base interest rates have
generally decreased relative to their levels prior to the disruptions in the financial markets, the
tightening of credit markets has affected the credit risk spreads charged over base interest rates
on, and the availability of, property loan financing. For future refinancing activities, our
liquidity and cost of funds may be affected by increases in base interest rates or higher credit
risk spreads. If timely property financing options are not available for maturing debt, we may
consider alternative sources of liquidity, such as reductions in certain capital spending or
proceeds from asset dispositions.
As further discussed in Note 2 to our consolidated financial statements in Item 8, we use
total rate of return swaps as a financing product to lower our cost of borrowing through conversion
of fixed rate tax-exempt bonds payable and fixed rate notes payable to variable interest rates
indexed to the SIFMA rate for tax-exempt bonds payable and the 30-day LIBOR rate for notes payable,
plus a credit risk spread. The cost of financing through these arrangements is generally lower
than the fixed rate on the debt. As of December 31, 2009, we had total rate of return swap
positions with two financial institutions with notional amounts totaling $353.1 million. Swaps
with notional amounts of $307.9 million and $45.2 million had maturity dates in May 2012 and
October 2012, respectively.
The total rate of return swaps require specified loan-to-value ratios. In the event the
values of the real estate properties serving as collateral under these agreements decline or if we
sell properties in the collateral pool with low loan-to-value ratios, certain of our consolidated
subsidiaries have an obligation to pay down the debt or provide additional collateral pursuant to
the swap agreements, which may adversely affect our cash flows. The obligation to provide
collateral is limited to these subsidiaries and is non-recourse to Aimco. At December 31, 2009,
these subsidiaries were not required to provide cash collateral based on the loan-to-value ratios
of the real estate properties serving as collateral under these agreements.
We periodically evaluate counterparty credit risk associated with these arrangements. At the
current time, we have concluded we do not have material exposure. In the event a counterparty were
to default under these arrangements, loss of the net interest benefit we generally receive under
these arrangements, which is equal to the difference between the fixed rate we receive and the
variable rate we pay, may adversely affect our operating cash flows.
See Derivative Financial Instruments in Note 2 to the consolidated financial statements in
Item 8 for additional discussion of these arrangements, including the current swap maturity dates.
As of December 31, 2009, the amount available under our $180.0 million revolving credit
facility was $136.2 million (after giving effect to $43.8 million outstanding for undrawn letters
of credit). Our total outstanding term loan of $90.0 million at December 31, 2009, matures in
March 2011. We repaid an additional $45.0 million on the term loan through February 26, 2010,
leaving a remaining outstanding balance of $45.0 million. Additionally, we have limited obligations
to fund redevelopment commitments during the year ending December 31, 2010, and no development
commitments.
At December 31, 2009, we had $81.3 million in cash and cash equivalents, a decrease of $218.4
million from December 31, 2008. At December 31, 2009, we had $219.0 million of restricted cash,
primarily consisting of reserves and escrows held by lenders for bond sinking funds, capital
additions, property taxes and insurance. In addition, cash, cash equivalents and restricted cash
are held by partnerships that are not presented on a consolidated basis. The following discussion
relates to changes in cash due to operating, investing and financing activities, which are
presented in our consolidated statements of cash flows in Item 8.
Operating Activities
For the year ended December 31, 2009, our net cash provided by operating activities of $233.8
million was primarily related to operating income from our consolidated properties, which is
affected primarily by rental rates, occupancy levels and operating expenses related to our
portfolio of properties, in excess of payments of operating accounts payable and accrued
liabilities, including amounts related to our organizational restructuring. Cash provided by
operating activities decreased $206.6 million compared with the year ended December 31, 2008,
primarily due to a $159.3 million decrease in operating income related to consolidated properties
included in discontinued operations, which was
attributable to property sales in 2009 and 2008, a $42.8 million decrease in promote income,
which is generated by the disposition of properties by consolidated real estate partnerships, and
an increase in payments on operating accounts payable and accrued expenses, including payments
related to our restructuring accrual, in 2009 as compared to 2008.
17
Investing Activities
For the year ended December 31, 2009, our net cash provided by investing activities of $630.3
million consisted primarily of proceeds from disposition of real estate and partnership interests,
partially offset by capital expenditures.
Although we hold all of our properties for investment, we sell properties when they do not
meet our investment criteria or are located in areas that we believe do not justify our continued
investment when compared to alternative uses for our capital. During the year ended December 31,
2009, we sold 89 consolidated properties. These properties were sold for an aggregate sales price
of $1.3 billion, or $1.2 billion, after the payment of transaction costs and debt prepayment
penalties. The $1.2 billion is inclusive of promote income and debt assumed by buyers. Net cash
proceeds from property sales were used primarily to repay term debt and for other corporate
purposes.
Capital Additions
We classify all capital additions as Capital Replacements (which we refer to as CR), Capital
Improvements (which we refer to as CI), casualties or redevelopment. Additions other than casualty
or redevelopment capital additions are apportioned between CR and CI based on the useful life of
the capital item under consideration and the period we have owned the property.
CR represents the share of capital additions that are deemed to replace the portion of
acquired capital assets that was consumed during the period we have owned the asset. CI represents
the share of additions that are made to enhance the value, profitability or useful life of an asset
as compared to its original purchase condition. CR and CI exclude capital additions for casualties
and redevelopment. Casualty additions represent capitalized costs incurred in connection with
casualty losses and are associated with the restoration of the asset. A portion of the restoration
costs may be reimbursed by insurance carriers subject to deductibles associated with each loss.
Redevelopment additions represent additions that substantially upgrade the property.
The table below details our share of actual spending, on both consolidated and unconsolidated
real estate partnerships, for CR, CI, casualties and redevelopment for the year ended December 31,
2009, on a per unit and total dollar basis (in thousands, except per unit amounts). Per unit
numbers for CR and CI are based on approximately 97,196 average units for the year, including
81,135 conventional units and 16,061 affordable units. Average units are weighted for the portion
of the period that we owned an interest in the property, represent ownership-adjusted effective
units, and exclude non-managed units.
Per | ||||||||
Aimcos Share | Effective | |||||||
of Additions | Unit | |||||||
Capital Replacements Detail: |
||||||||
Building and grounds |
$ | 32,876 | $ | 338 | ||||
Turnover related |
30,298 | 312 | ||||||
Capitalized site payroll and indirect costs |
7,076 | 73 | ||||||
Our share of Capital Replacements |
$ | 70,250 | $ | 723 | ||||
Capital Replacements: |
||||||||
Conventional |
$ | 64,675 | $ | 797 | ||||
Affordable |
5,575 | $ | 347 | |||||
Our share of Capital Replacements |
70,250 | $ | 723 | |||||
Capital Improvements: |
||||||||
Conventional |
47,634 | $ | 587 | |||||
Affordable |
5,755 | $ | 358 | |||||
Our share of Capital Improvements |
53,389 | $ | 549 | |||||
Casualties: |
||||||||
Conventional |
17,724 | |||||||
Affordable |
1,872 | |||||||
Our share of casualties |
19,596 | |||||||
Redevelopment: |
||||||||
Conventional projects |
66,768 | |||||||
Tax credit projects (1) |
46,066 | |||||||
Our share of redevelopment |
112,834 | |||||||
Our share of capital additions |
256,069 | |||||||
Plus noncontrolling partners share of consolidated additions |
20,062 | |||||||
Less our share of unconsolidated additions |
(687 | ) | ||||||
Total capital additions |
$ | 275,444 | ||||||
(1) | Redevelopment additions on tax credit projects are substantially funded from tax
credit investor contributions. |
18
Included in the above additions for CI, casualties and redevelopment, was approximately $34.6
million of our share of capitalized site payroll and indirect costs related to these activities for
the year ended December 31, 2009.
We generally fund capital additions with cash provided by operating activities, working
capital and property sales as discussed below.
Financing Activities
For the year ended December 31, 2009, net cash used in financing activities of $1.1 billion
was primarily attributed to debt principal payments, dividends paid to common and preferred
stockholders and distributions to noncontrolling interests, partially offset by proceeds from
property loans.
Property Debt
At December 31, 2009 and 2008, we had $5.6 billion and $6.3 billion, respectively, in
consolidated property debt outstanding, which included $178.3 million and $909.4 million,
respectively, of property debt classified within liabilities related to assets held for sale.
During the year ended December 31, 2009, we refinanced or closed property loans on 55 properties
generating $788.1 million of proceeds from borrowings with a weighted average interest rate of
5.78%. Our share of the net proceeds after repayment of existing debt, payment of transaction
costs and distributions to limited partners, was $132.3 million. We used these total net proceeds
for capital expenditures and other corporate purposes. We intend to continue to refinance property
debt primarily as a means of extending current and near term maturities and to finance certain
capital projects.
Term Loans and Credit Facility
We have an Amended and Restated Senior Secured Credit Agreement, as amended, with a syndicate
of financial institutions, which we refer to as the Credit Agreement.
As of December 31, 2009, the Credit Agreement consisted of aggregate commitments of $270.0
million, comprised of our $90.0 million outstanding balance on the term loan and $180.0 million of
revolving loan commitments. The term loan bears interest at LIBOR plus 1.5%, or at our option, a
base rate equal to the prime rate, and matures March 2011. Borrowings under the revolving credit
facility bear interest based on a pricing grid determined by leverage (either at LIBOR plus 4.25%
with a LIBOR floor of 2.00% or, at our option, a base rate equal to the Prime rate plus a spread of
3.00%). The revolving credit facility matures May 1, 2011, and may be extended for an additional
year, subject to certain conditions, including payment of a 45.0 basis point fee on the total
revolving commitments and repayment of the remaining term loan balance by February 1, 2011.
At December 31, 2009, the term loan had an outstanding principal balance of $90.0 million and
an interest rate of 1.73%. We repaid $45.0 million on the term loan through February 26, 2010,
leaving a remaining outstanding balance of $45.0 million. At December 31, 2009, we had no
outstanding borrowings under the revolving credit facility. The amount available under the
revolving credit facility at December 31, 2009, was $136.2 million (after giving effect to $43.8
million outstanding for undrawn letters of credit issued under the revolving credit facility). The
proceeds of revolving loans are generally permitted to be used to fund working capital and for
other corporate purposes.
Fair Value Measurements
We have entered into total rate of return swaps on various fixed rate secured tax-exempt bonds
payable and fixed rate notes payable to convert these borrowings from a fixed rate to a variable
rate and provide an efficient financing product to lower our cost of borrowing. We designate total
rate of return swaps as hedges of the risk of overall changes in the fair value of the underlying
borrowings. At each reporting period, we estimate the fair value of these borrowings and the total
rate of return swaps and recognize any changes therein as an adjustment of interest expense.
19
Our method used to calculate the fair value of the total rate of return swaps generally
results in changes in fair value that are equal to the changes in fair value of the related
borrowings, which is consistent with our hedging strategy. We believe that these financial
instruments are highly effective in offsetting the changes in fair value of the related borrowings
during the hedging period, and accordingly, changes in the fair value of these instruments have no
material impact on our liquidity, results of operations or capital resources.
During the year ended December 31, 2009, changes in the fair values of these financial
instruments resulted in increases of $5.2 million in the carrying amount of the hedged borrowings
and equal decreases in accrued liabilities and other for total rate of return swaps. At December
31, 2009, the cumulative recognized changes in the fair value of these financial instruments
resulted in a $24.3 million reduction in the carrying amount of the hedged borrowings offset by an
equal increase in accrued liabilities and other for total rate of return swaps. The cumulative
changes in the fair values of the hedged borrowings and related swaps reflect the recent
uncertainty in the credit markets which has decreased demand and increased pricing for similar debt
instruments.
During the year ended December 31, 2009, we received net cash receipts of $19.4 million under
the total return swaps, which positively affected our liquidity. To the extent interest rates
increase above the fixed rates on the underlying borrowings, our obligations under the total return
swaps will negatively affect our liquidity. At December 31, 2009, we were not required to provide
cash collateral pursuant to the total rate of return swaps. In the event the values of the real
estate properties serving as collateral under these agreements decline, we may be required to
provide additional collateral pursuant to the swap agreements, which would adversely affect our
liquidity.
See Note 2 to the consolidated financial statements in Item 8 for more information on our
total rate of return swaps and related borrowings.
Equity Transactions
During the year ended December 31, 2009, we paid cash dividends or distributions totaling
$52.2 million, $95.3 million and $28.5 million to preferred stockholders, common stockholders and
noncontrolling interests in the Aimco Operating Partnership, respectively. Additionally, we paid
dividends totaling $149.0 million to common stockholders through the issuance of approximately 15.5
million shares. During the year ended December 31, 2009, we paid distributions of $91.9 million to
noncontrolling interests in consolidated real estate partnerships.
During the year ended December 31, 2009, we repurchased 12 shares, or $6.0 million in
liquidation preference, of CRA Preferred Stock for $4.2 million.
We and the Aimco Operating Partnership have a shelf registration statement that provides for
the issuance of debt and equity securities by Aimco and debt securities by the Aimco Operating
Partnership.
Contractual Obligations
This table summarizes information contained elsewhere in this Annual Report regarding payments
due under contractual obligations and commitments as of December 31, 2009 (amounts in thousands):
Less than | More than | |||||||||||||||||||
Total | One Year | 1-3 Years | 3-5 Years | 5 Years | ||||||||||||||||
Scheduled long-term debt maturities (1) |
$ | 5,451,148 | $ | 100,958 | $ | 651,166 | $ | 843,747 | $ | 3,855,277 | ||||||||||
Scheduled long-term debt maturities related
to properties classified as held for sale (1) |
178,339 | 4,855 | 20,773 | 25,736 | 126,975 | |||||||||||||||
Term loan (1) (2) |
90,000 | | 90,000 | | | |||||||||||||||
Redevelopment and other construction
commitments |
4,795 | 4,795 | | | | |||||||||||||||
Leases for space occupied (3) |
24,888 | 7,345 | 10,856 | 4,859 | 1,828 | |||||||||||||||
Other obligations (4) |
4,605 | 4,605 | | | | |||||||||||||||
Total |
$ | 5,753,775 | $ | 122,558 | $ | 772,795 | $ | 874,342 | $ | 3,984,080 | ||||||||||
(1) | Scheduled debt maturities presented above include amortization and the maturities in 2010
consist primarily of amortization. The scheduled maturities presented above exclude related
interest amounts. Refer to Note 6 in
the consolidated financial statements in Item 8 for a description of average interest rates
associated with our debt. |
20
(2) | After payments of $45.0 million through February 26, 2010, the term loan had an outstanding
balance of $45.0 million. |
|
(3) | Inclusive of leased space that has been abandoned as part of our organizational
restructuring in 2008 (see Restructuring Costs in Note 3 to the consolidated financial
statements in Item 8). |
|
(4) | Represents a commitment to fund $4.6 million in second mortgage loans on certain properties
in West Harlem, New York City. |
In addition to the amounts presented in the table above, at December 31, 2009, we had $690.5
million of outstanding preferred stock outstanding with annual dividend yields ranging from 1.5%
(variable) to 9.4%, and $85.7 million of preferred units of the Aimco Operating Partnership
outstanding with annual distribution yields ranging from 5.9% to 9.5%.
Additionally, we may enter into commitments to purchase goods and services in connection with
the operations of our properties. Those commitments generally have terms of one year or less and
reflect expenditure levels comparable to our historical expenditures.
Future Capital Needs
In addition to the items set forth in Contractual Obligations above, we expect to fund any
future acquisitions, additional redevelopment projects, capital improvements and capital
replacement principally with proceeds from property sales (including tax-free exchange proceeds),
short-term borrowings, debt and equity financing (including tax credit equity) and operating cash
flows.
Off-Balance Sheet Arrangements
We own general and limited partner interests in unconsolidated real estate partnerships, in
which our total ownership interests typically range from less than 1% to 50% and in some instances
may exceed 50%. There are no lines of credit, side agreements, or any other derivative financial
instruments related to or between our unconsolidated real estate partnerships and us and no
material exposure to financial guarantees. Accordingly, our maximum risk of loss related to these
unconsolidated real estate partnerships is limited to the aggregate carrying amount of our
investment in the unconsolidated real estate partnerships and any outstanding notes receivable as
reported in our consolidated financial statements (see Note 4 of the consolidated financial
statements in Item 8 for additional information about our investments in unconsolidated real estate
partnerships).
21
Item 8. Financial Statements and Supplementary Data
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
INDEX TO FINANCIAL STATEMENTS
Page | ||
Financial Statements: |
||
Report of Independent Registered Public Accounting Firm |
23 | |
Consolidated Balance Sheets as of December 31, 2009 and 2008 |
24 | |
Consolidated Statements of Income for the Years Ended December 31, 2009, 2008 (as restated) and
2007 |
25 | |
Consolidated Statements of Equity for the Years Ended December 31, 2009, 2008 and 2007 |
26 | |
Consolidated Statements of Cash Flows for the Years Ended December 31, 2009, 2008 and 2007 |
28 | |
Notes to Consolidated Financial Statements |
30 | |
Financial Statement Schedule: |
||
Schedule III Real Estate and Accumulated Depreciation |
72 |
All other schedules are omitted because they are not applicable or the required information is
shown in the financial statements or notes thereto.
22
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Stockholders and Board of Directors
Apartment Investment and Management Company
Apartment Investment and Management Company
We have audited the accompanying consolidated balance sheets of Apartment Investment and Management
Company (the Company) as of December 31, 2009 and 2008, and the related consolidated statements
of income, equity and cash flows for each of the three years in the period ended December 31, 2009.
Our audits also included the financial statement schedule listed in the accompanying Index to
Financial Statements. These financial statements and schedule are the responsibility of the
Companys management. Our responsibility is to express an opinion on these financial statements and
schedule based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material
respects, the consolidated financial position of the Company at December 31, 2009 and 2008, and the
consolidated results of its operations and its cash flows for each of the three years in the period
ended December 31, 2009, in conformity with United States generally accepted accounting principles.
Also, in our opinion, the related financial statement schedule, when considered in relation to the
basic financial statements taken as a whole, presents fairly, in all material respects the
information set forth therein.
The consolidated financial statements include retroactive adjustments to reflect the adoption in
2009 of Statement of Financial Accounting Standards No. 160, Noncontrolling Interests in
Consolidated Financial Statements, an amendment to ARB 51 (codified in FASB ASC 810), Statement of
Financial Accounting Standards No. 141(R), Business Combinations a replacement of FASB Statement
No 141 (codified in FASB ASC 805), FASB Staff Position No. EITF 03-6-1, Determining Whether
Instruments Granted in Share-Based Payment Transactions are Participating Securities (codified in
FASB ASC 260), and FASB Accounting Standards Update No. 2010-01, Accounting for Distributions to
Shareholders with Components of Stock and Cash (codified in FASB ASC 505). Further, as discussed in
Notes 13 and 17, the Company retrospectively adjusted the consolidated financial statements to
reflect real estate assets that meet the definition of a component and have been sold or meet the
criteria to be classified as held for sale at December 31, 2009 pursuant to Statement of Financial
Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets
(codified in FASB ASC 360), through September 30, 2010, and to reflect changes in its reportable
segments. As discussed in Note 2 to the consolidated financial statements, the consolidated
statement of income for the year ended December 31, 2008 has been restated to reclassify provisions
for impairment losses on real estate development assets into operating income.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States), the Companys internal control over financial reporting as of December 31,
2009, based on criteria established in Internal Control Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 26,
2010 (which is not included herein) expressed an unqualified opinion thereon.
/s/ ERNST & YOUNG LLP |
Denver, Colorado
February 26, 2010, except for Note 17, as to which the date is September 10, 2010,
and Note 13, as to which the date is November 19, 2010
February 26, 2010, except for Note 17, as to which the date is September 10, 2010,
and Note 13, as to which the date is November 19, 2010
23
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CONSOLIDATED BALANCE SHEETS
As of December 31, 2009 and 2008
(In thousands, except share data)
CONSOLIDATED BALANCE SHEETS
As of December 31, 2009 and 2008
(In thousands, except share data)
2009 | 2008 | |||||||
ASSETS |
||||||||
Real estate: |
||||||||
Buildings and improvements |
$ | 7,242,051 | $ | 7,047,744 | ||||
Land |
2,148,389 | 2,132,129 | ||||||
Total real estate |
9,390,440 | 9,179,873 | ||||||
Less accumulated depreciation |
(2,595,049 | ) | (2,223,242 | ) | ||||
Net real estate |
6,795,391 | 6,956,631 | ||||||
Cash and cash equivalents |
81,260 | 299,676 | ||||||
Restricted cash |
218,981 | 252,199 | ||||||
Accounts receivable, net |
59,822 | 90,318 | ||||||
Accounts receivable from affiliates, net |
23,744 | 38,978 | ||||||
Deferred financing costs, net |
50,807 | 49,947 | ||||||
Notes receivable from unconsolidated real estate partnerships, net |
14,295 | 22,567 | ||||||
Notes receivable from non-affiliates, net |
125,269 | 139,897 | ||||||
Investment in unconsolidated real estate partnerships |
105,324 | 119,036 | ||||||
Other assets |
185,890 | 198,713 | ||||||
Deferred income tax assets, net |
42,015 | 28,326 | ||||||
Assets held for sale |
203,670 | 1,245,582 | ||||||
Total assets |
$ | 7,906,468 | $ | 9,441,870 | ||||
LIABILITIES AND EQUITY |
||||||||
Property tax-exempt bond financing |
$ | 574,926 | $ | 629,499 | ||||
Property loans payable |
4,823,165 | 4,794,291 | ||||||
Term loans |
90,000 | 400,000 | ||||||
Other borrowings |
53,057 | 95,981 | ||||||
Total indebtedness |
5,541,148 | 5,919,771 | ||||||
Accounts payable |
29,819 | 64,241 | ||||||
Accrued liabilities and other |
286,326 | 569,997 | ||||||
Deferred income |
179,433 | 192,368 | ||||||
Security deposits |
34,491 | 35,920 | ||||||
Liabilities related to assets held for sale |
183,892 | 924,676 | ||||||
Total liabilities |
6,255,109 | 7,706,973 | ||||||
Preferred noncontrolling interests in Aimco Operating Partnership |
86,656 | 88,148 | ||||||
Preferred stock subject to repurchase agreement (Note 11) |
30,000 | | ||||||
Commitments and contingencies (Note 8) |
| | ||||||
Equity: |
||||||||
Perpetual Preferred Stock (Note 11) |
660,500 | 696,500 | ||||||
Class A Common Stock, $0.01 par value, 426,157,736 shares authorized,
116,479,791 and 100,631,881 shares issued and outstanding, at
December 31, 2009 and 2008, respectively |
1,165 | 1,006 | ||||||
Additional paid-in capital |
3,072,665 | 2,910,002 | ||||||
Accumulated other comprehensive loss |
(1,138 | ) | (2,249 | ) | ||||
Notes due on common stock purchases |
(1,392 | ) | (3,607 | ) | ||||
Distributions in excess of earnings |
(2,492,082 | ) | (2,335,628 | ) | ||||
Total Aimco equity |
1,239,718 | 1,266,024 | ||||||
Noncontrolling interests in consolidated real estate partnerships |
316,177 | 380,725 | ||||||
Common noncontrolling interests in Aimco Operating Partnership |
(21,192 | ) | | |||||
Total equity |
1,534,703 | 1,646,749 | ||||||
Total liabilities and equity |
$ | 7,906,468 | $ | 9,441,870 | ||||
See notes to consolidated financial statements.
24
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CONSOLIDATED STATEMENTS OF INCOME
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands, except per share data)
CONSOLIDATED STATEMENTS OF INCOME
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands, except per share data)
2009 | 2008 | 2007 | ||||||||||
(as restated | ||||||||||||
see Note 2) | ||||||||||||
REVENUES: |
||||||||||||
Rental and other property revenues |
$ | 1,101,883 | $ | 1,100,593 | $ | 1,058,354 | ||||||
Asset management and tax credit revenues |
49,853 | 98,830 | 73,755 | |||||||||
Total revenues |
1,151,736 | 1,199,423 | 1,132,109 | |||||||||
OPERATING EXPENSES: |
||||||||||||
Property operating expenses |
515,748 | 527,216 | 507,403 | |||||||||
Investment management expenses |
15,779 | 24,784 | 20,507 | |||||||||
Depreciation and amortization |
433,933 | 383,084 | 337,804 | |||||||||
Provision for operating real estate impairment losses |
2,329 | | 1,080 | |||||||||
Provision for impairment losses on real estate development assets |
| 91,138 | | |||||||||
General and administrative expenses |
56,643 | 80,376 | 72,359 | |||||||||
Other expenses, net |
15,721 | 22,059 | 18,917 | |||||||||
Restructuring costs |
11,241 | 22,802 | | |||||||||
Total operating expenses |
1,051,394 | 1,151,459 | 958,070 | |||||||||
Operating income |
100,342 | 47,964 | 174,039 | |||||||||
Interest income |
9,104 | 19,653 | 42,812 | |||||||||
Provision for losses on notes receivable, net |
(21,549 | ) | (17,577 | ) | (2,010 | ) | ||||||
Interest expense |
(315,416 | ) | (315,007 | ) | (304,752 | ) | ||||||
Equity in losses of unconsolidated real estate partnerships |
(12,025 | ) | (4,601 | ) | (3,347 | ) | ||||||
Impairment losses related to unconsolidated real estate partnerships |
(322 | ) | (2,661 | ) | | |||||||
Gain on dispositions of unconsolidated real estate and other |
22,494 | 99,864 | 23,366 | |||||||||
Loss before income taxes and discontinued operations |
(217,372 | ) | (172,365 | ) | (69,892 | ) | ||||||
Income tax benefit |
18,669 | 53,202 | 19,795 | |||||||||
Loss from continuing operations |
(198,703 | ) | (119,163 | ) | (50,097 | ) | ||||||
Income from discontinued operations, net |
153,903 | 746,165 | 175,603 | |||||||||
Net (loss) income |
(44,800 | ) | 627,002 | 125,506 | ||||||||
Noncontrolling interests: |
||||||||||||
Net income attributable to noncontrolling interests in consolidated real
estate partnerships |
(22,541 | ) | (155,727 | ) | (92,165 | ) | ||||||
Net income attributable to preferred noncontrolling interests in Aimco
Operating Partnership |
(6,288 | ) | (7,646 | ) | (7,128 | ) | ||||||
Net loss (income) attributable to common noncontrolling interests in Aimco
Operating Partnership |
9,355 | (51,622 | ) | 3,698 | ||||||||
Total noncontrolling interests |
(19,474 | ) | (214,995 | ) | (95,595 | ) | ||||||
Net (loss) income attributable to Aimco |
(64,274 | ) | 412,007 | 29,911 | ||||||||
Net income attributable to Aimco preferred stockholders |
(50,566 | ) | (53,708 | ) | (66,016 | ) | ||||||
Net income attributable to participating securities |
| (6,985 | ) | (4,481 | ) | |||||||
Net (loss) income attributable to Aimco common stockholders |
$ | (114,840 | ) | $ | 351,314 | $ | (40,586 | ) | ||||
Earnings (loss) per common share basic and diluted: |
||||||||||||
Loss from continuing operations attributable to Aimco common stockholders |
$ | (1.75 | ) | $ | (2.11 | ) | $ | (1.42 | ) | |||
Income from discontinued operations attributable to Aimco common
stockholders |
0.75 | 6.07 | 0.99 | |||||||||
Net (loss) income attributable to Aimco common stockholders |
$ | (1.00 | ) | $ | 3.96 | $ | (0.43 | ) | ||||
Weighted average common shares outstanding basic and diluted |
114,301 | 88,690 | 95,107 | |||||||||
Dividends declared per common share |
$ | 0.40 | $ | 7.48 | $ | 4.31 | ||||||
See
notes to consolidated financial statements.
25
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CONSOLIDATED STATEMENTS OF EQUITY
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
CONSOLIDATED STATEMENTS OF EQUITY
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
Accumulated | Notes Due on | |||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional | Other | Common | Distributions | |||||||||||||||||||||||||||||||||||||||
Shares | Shares | Paid-in | Comprehensive | Stock | in Excess of | Total Aimco | Noncontrolling | Total | ||||||||||||||||||||||||||||||||||||
Issued | Amount | Issued | Amount | Capital | Loss | Purchases | Earnings | Equity | Interests | Equity | ||||||||||||||||||||||||||||||||||
Balances at December 31, 2006 |
26,845 | $ | 823,500 | 96,820 | $ | 968 | $ | 3,095,564 | $ | (134 | ) | $ | (4,714 | ) | $ | (1,575,292 | ) | $ | 2,339,892 | $ | 310,289 | $ | 2,650,181 | |||||||||||||||||||||
Redemption of Preferred Stock and preferred
partnership units |
(1,905 | ) | (100,000 | ) | | | 635 | | | (2,635 | ) | (102,000 | ) | | (102,000 | ) | ||||||||||||||||||||||||||||
Cumulative effect of change in accounting
principle adoption of FIN 48 |
| | | | | | | (764 | ) | (764 | ) | (81 | ) | (845 | ) | |||||||||||||||||||||||||||||
Redemption of Aimco Operating Partnership
units for Common Stock |
| | 471 | 5 | 27,848 | | | | 27,853 | (27,810 | ) | 43 | ||||||||||||||||||||||||||||||||
Repurchases of Common Stock and common
partnership units |
| | (7,456 | ) | (75 | ) | (325,747 | ) | | | | (325,822 | ) | (2,181 | ) | (328,003 | ) | |||||||||||||||||||||||||||
Repayment of notes receivable from officers |
| | | | | | 1,659 | | 1,659 | | 1,659 | |||||||||||||||||||||||||||||||||
Officer and employee stock awards and
purchases, net |
| | 313 | 3 | 2,555 | | (2,386 | ) | | 172 | | 172 | ||||||||||||||||||||||||||||||||
Stock options exercised |
| | 1,403 | 14 | 53,705 | | | | 53,719 | | 53,719 | |||||||||||||||||||||||||||||||||
Amortization of stock option and restricted
stock compensation cost |
| | | | 19,224 | | | | 19,224 | | 19,224 | |||||||||||||||||||||||||||||||||
Issuance of Aimco Operating Partnership units |
| | | | | | | | | 2,998 | 2,998 | |||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests |
| | | | | | | | | 203,552 | 203,552 | |||||||||||||||||||||||||||||||||
Adjustment to noncontrolling interests from
VMS transactions (Note 3) |
| | | | | | | | | 62,820 | 62,820 | |||||||||||||||||||||||||||||||||
Adjustment to noncontrolling interests from
consolidation of entities |
| | | | | | | | | 91,219 | 91,219 | |||||||||||||||||||||||||||||||||
Reversal of excess income tax benefits
related to stock-based compensation and
other |
| | | | (751 | ) | | | | (751 | ) | | (751 | ) | ||||||||||||||||||||||||||||||
Change in accumulated other comprehensive
income |
| | | | | (550 | ) | | | (550 | ) | 365 | (185 | ) | ||||||||||||||||||||||||||||||
Net income |
| | | | | | | 29,911 | 29,911 | 88,467 | 118,378 | |||||||||||||||||||||||||||||||||
Common dividends and distributions |
| | | | | | | (406,121 | ) | (406,121 | ) | (252,887 | ) | (659,008 | ) | |||||||||||||||||||||||||||||
Preferred Stock dividends |
| | | | | | | (64,817 | ) | (64,817 | ) | | (64,817 | ) | ||||||||||||||||||||||||||||||
Balances at December 31, 2007 |
24,940 | 723,500 | 91,551 | 915 | 2,873,033 | (684 | ) | (5,441 | ) | (2,019,718 | ) | 1,571,605 | 476,751 | 2,048,356 | ||||||||||||||||||||||||||||||
Repurchase of Preferred Stock |
| (27,000 | ) | | | 678 | | | 1,482 | (24,840 | ) | | (24,840 | ) | ||||||||||||||||||||||||||||||
Redemption of Aimco Operating Partnership
units for Common Stock |
| | 114 | 1 | 4,181 | | | | 4,182 | (4,182 | ) | | ||||||||||||||||||||||||||||||||
Repurchases of Common Stock and common
partnership units |
| | (13,919 | ) | (139 | ) | (473,393 | ) | | | | (473,532 | ) | (3,192 | ) | (476,724 | ) | |||||||||||||||||||||||||||
Repayment of notes receivable from officers |
| | | | | | 1,458 | | 1,458 | | 1,458 | |||||||||||||||||||||||||||||||||
Officer and employee stock awards and
purchases, net |
| | 106 | 1 | 651 | | 376 | | 1,028 | | 1,028 | |||||||||||||||||||||||||||||||||
Amortization of stock option and restricted
stock compensation cost |
| | | | 17,603 | | | | 17,603 | | 17,603 | |||||||||||||||||||||||||||||||||
Common Stock issued pursuant to Special
Dividend |
| | 22,780 | 228 | 487,249 | | | | 487,477 | | 487,477 | |||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests |
| | | | | | | | | 6,854 | 6,854 | |||||||||||||||||||||||||||||||||
Adjustment to noncontrolling interests from
consolidation of entities |
| | | | | | | | | 14,969 | 14,969 | |||||||||||||||||||||||||||||||||
Change in accumulated other comprehensive
income |
| | | | | (1,565 | ) | | | (1,565 | ) | 190 | (1,375 | ) | ||||||||||||||||||||||||||||||
Net income |
| | | | | | | 412,007 | 412,007 | 207,349 | 619,356 | |||||||||||||||||||||||||||||||||
Common dividends and distributions |
| | | | | | | (674,185 | ) | (674,185 | ) | (318,014 | ) | (992,199 | ) | |||||||||||||||||||||||||||||
Preferred Stock dividends |
| | | | | | | (55,214 | ) | (55,214 | ) | | (55,214 | ) | ||||||||||||||||||||||||||||||
Balances at December 31, 2008 |
24,940 | 696,500 | 100,632 | 1,006 | 2,910,002 | (2,249 | ) | (3,607 | ) | (2,335,628 | ) | 1,266,024 | 380,725 | 1,646,749 | ||||||||||||||||||||||||||||||
See notes to consolidated financial statements.
26
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CONSOLIDATED STATEMENTS OF EQUITY
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
CONSOLIDATED STATEMENTS OF EQUITY
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
Accumulated | Notes Due on | |||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional | Other | Common | Distributions | |||||||||||||||||||||||||||||||||||||||
Shares | Shares | Paid-in | Comprehensive | Stock | in Excess of | Total Aimco | Noncontrolling | Total | ||||||||||||||||||||||||||||||||||||
Issued | Amount | Issued | Amount | Capital | Loss | Purchases | Earnings | Equity | Interests | Equity | ||||||||||||||||||||||||||||||||||
Repurchase of Preferred Stock |
| (6,000 | ) | | | 151 | | | 1,800 | (4,049 | ) | | (4,049 | ) | ||||||||||||||||||||||||||||||
Reclassification of preferred stock to
temporary equity |
| (30,000 | ) | | | | | | | (30,000 | ) | | (30,000 | ) | ||||||||||||||||||||||||||||||
Redemption or Conversion of Aimco Operating
Partnership units for Common Stock |
| | 527 | 5 | 7,080 | | | | 7,085 | (7,085 | ) | | ||||||||||||||||||||||||||||||||
Repurchases of Common Stock and common
partnership units |
| | | | | | | | | (980 | ) | (980 | ) | |||||||||||||||||||||||||||||||
Repayment of notes receivable from officers |
| | | | | | 763 | | 763 | | 763 | |||||||||||||||||||||||||||||||||
Common Stock issued pursuant to special
dividends |
| | 15,548 | 156 | 148,590 | | | | 148,746 | | 148,746 | |||||||||||||||||||||||||||||||||
Officer and employee stock awards and
purchases, net |
| | (227 | ) | (2 | ) | (1,476 | ) | | 1,452 | | (26 | ) | | (26 | ) | ||||||||||||||||||||||||||||
Amortization of stock option and restricted
stock compensation cost |
| | | | 8,007 | | | | 8,007 | | 8,007 | |||||||||||||||||||||||||||||||||
Expense for dividends on forfeited shares
and other OP Unit distributions |
| | | | 311 | | | 2,917 | 3,228 | (990 | ) | 2,238 | ||||||||||||||||||||||||||||||||
Contributions from noncontrolling interests |
| | | | | | | | | 5,535 | 5,535 | |||||||||||||||||||||||||||||||||
Adjustment to noncontrolling interests from
consolidation of entities |
| | | | | | | | | (1,151 | ) | (1,151 | ) | |||||||||||||||||||||||||||||||
Change in accumulated other comprehensive
income |
| | | | | 1,111 | | | 1,111 | 297 | 1,408 | |||||||||||||||||||||||||||||||||
Net income |
| | | | | | | (64,274 | ) | (64,274 | ) | 13,186 | (51,088 | ) | ||||||||||||||||||||||||||||||
Common dividends and distributions |
| | | | | | | (46,202 | ) | (46,202 | ) | (94,552 | ) | (140,754 | ) | |||||||||||||||||||||||||||||
Preferred Stock dividends |
| | | | | | | (50,695 | ) | (50,695 | ) | | (50,695 | ) | ||||||||||||||||||||||||||||||
Balances at December 31, 2009 |
24,940 | $ | 660,500 | 116,480 | $ | 1,165 | $ | 3,072,665 | $ | (1,138 | ) | $ | (1,392 | ) | $ | (2,492,082 | ) | $ | 1,239,718 | $ | 294,985 | $ | 1,534,703 | |||||||||||||||||||||
See notes to consolidated financial statements.
27
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
2009 | 2008 | 2007 | ||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||||||
Net (loss) income |
$ | (44,800 | ) | $ | 627,002 | $ | 125,506 | |||||
Adjustments to reconcile net (loss) income to net cash provided by operating
activities: |
||||||||||||
Depreciation and amortization |
433,933 | 383,084 | 337,804 | |||||||||
Equity in losses of unconsolidated real estate partnerships |
12,025 | 4,601 | 3,347 | |||||||||
Provision for impairment losses on real estate development assets |
| 91,138 | | |||||||||
Provision for operating real estate impairment losses |
2,329 | | 1,080 | |||||||||
Gain on dispositions of unconsolidated real estate and other |
(22,494 | ) | (99,864 | ) | (23,366 | ) | ||||||
Income tax benefit |
(18,669 | ) | (53,202 | ) | (19,795 | ) | ||||||
Stock-based compensation expense |
6,666 | 13,833 | 14,921 | |||||||||
Amortization of deferred loan costs and other |
10,845 | 9,950 | 7,916 | |||||||||
Distributions of earnings from unconsolidated entities |
4,893 | 14,619 | 4,239 | |||||||||
Discontinued operations: |
||||||||||||
Depreciation and amortization |
61,634 | 132,463 | 162,134 | |||||||||
Gain on disposition of real estate |
(221,793 | ) | (800,335 | ) | (117,628 | ) | ||||||
Other adjustments to income from discontinued operations |
53,974 | 67,215 | (25,167 | ) | ||||||||
Changes in operating assets and operating liabilities: |
||||||||||||
Accounts receivable |
27,067 | 4,848 | 7,453 | |||||||||
Other assets |
2,440 | 57,155 | (9,751 | ) | ||||||||
Accounts payable, accrued liabilities and other |
(74,238 | ) | (12,139 | ) | 14,249 | |||||||
Total adjustments |
278,612 | (186,634 | ) | 357,436 | ||||||||
Net cash provided by operating activities |
233,812 | 440,368 | 482,942 | |||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||||||
Purchases of real estate |
| (112,655 | ) | (201,434 | ) | |||||||
Capital expenditures |
(300,344 | ) | (665,233 | ) | (689,719 | ) | ||||||
Proceeds from dispositions of real estate |
875,931 | 2,060,344 | 431,863 | |||||||||
Change in funds held in escrow from tax-free exchanges |
| 345 | 25,863 | |||||||||
Proceeds from sale of interests and distributions from real estate partnerships |
25,067 | 94,277 | 198,998 | |||||||||
Purchases of partnership interests and other assets |
(6,842 | ) | (28,121 | ) | (86,204 | ) | ||||||
Originations of notes receivable |
(5,778 | ) | (6,911 | ) | (10,812 | ) | ||||||
Proceeds from repayment of notes receivable |
5,264 | 8,929 | 14,370 | |||||||||
Other investing activities |
36,956 | (6,106 | ) | 45,476 | ||||||||
Net cash provided by (used in) investing activities |
630,254 | 1,344,869 | (271,599 | ) | ||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||||||
Proceeds from property loans |
772,443 | 949,549 | 1,552,048 | |||||||||
Principal repayments on property loans |
(1,076,318 | ) | (1,291,543 | ) | (850,484 | ) | ||||||
Proceeds from tax-exempt bond financing |
15,727 | 50,100 | 82,350 | |||||||||
Principal repayments on tax-exempt bond financing |
(157,862 | ) | (217,361 | ) | (70,029 | ) | ||||||
(Payments on) borrowings under term loans |
(310,000 | ) | (75,000 | ) | 75,000 | |||||||
Net repayments on revolving credit facility |
| | (140,000 | ) | ||||||||
Proceeds from (payments on) other borrowings |
(40,085 | ) | 21,367 | (8,468 | ) | |||||||
Repurchases and redemptions of preferred stock |
(4,200 | ) | (24,840 | ) | (102,000 | ) | ||||||
Repurchases of Class A Common Stock |
| (502,296 | ) | (307,382 | ) | |||||||
Proceeds from Class A Common Stock option exercises |
| 481 | 53,719 | |||||||||
Payment of Class A Common Stock dividends |
(95,335 | ) | (212,286 | ) | (230,806 | ) | ||||||
Payment of preferred stock dividends |
(52,215 | ) | (55,215 | ) | (67,100 | ) | ||||||
Payment of distributions to noncontrolling interests |
(120,361 | ) | (330,582 | ) | (198,090 | ) | ||||||
Other financing activities |
(14,276 | ) | (8,396 | ) | (19,464 | ) | ||||||
Net cash used in financing activities |
(1,082,482 | ) | (1,696,022 | ) | (230,706 | ) | ||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS |
(218,416 | ) | 89,215 | (19,363 | ) | |||||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR |
299,676 | 210,461 | 229,824 | |||||||||
CASH AND CASH EQUIVALENTS AT END OF YEAR |
$ | 81,260 | $ | 299,676 | $ | 210,461 | ||||||
See notes to consolidated financial statements.
28
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2009, 2008 and 2007
(In thousands)
2009 | 2008 | 2007 | ||||||||||
SUPPLEMENTAL CASH FLOW INFORMATION: |
||||||||||||
Interest paid |
$ | 348,341 | $ | 434,645 | $ | 452,324 | ||||||
Cash paid for income taxes |
4,560 | 13,780 | 2,994 | |||||||||
Non-cash transactions associated with the acquisition of real estate and
interests in unconsolidated real estate partnerships: |
||||||||||||
Secured debt assumed in connection with purchase of real estate |
| | 16,000 | |||||||||
Issuance of OP Units for interests in unconsolidated real estate
partnerships and acquisitions of real estate |
| | 2,998 | |||||||||
Non-cash transactions associated with the disposition of real estate: |
||||||||||||
Secured debt assumed in connection with the disposition of real estate |
314,265 | 157,394 | 27,929 | |||||||||
Issuance of notes receivable connection with the disposition of real estate |
3,605 | 10,372 | | |||||||||
Non-cash transactions associated with consolidation of real estate partnerships: |
||||||||||||
Real estate, net |
6,058 | 25,830 | 56,877 | |||||||||
Investments in and notes receivable primarily from affiliated entities |
4,326 | 4,497 | 84,545 | |||||||||
Restricted cash and other assets |
(1,682 | ) | 5,483 | 8,545 | ||||||||
Secured debt |
2,031 | 22,036 | 41,296 | |||||||||
Accounts payable, accrued and other liabilities |
6,769 | 14,020 | 48,602 | |||||||||
Other non-cash transactions: |
||||||||||||
Redemption of common OP Units for Class A Common Stock |
7,085 | 4,182 | 27,810 | |||||||||
Conversion of preferred OP Units for Class A Common Stock |
| | 43 | |||||||||
(Cancellation) origination of notes receivable from officers for Class A
Common Stock purchases, net |
(1,452 | ) | (385 | ) | 2,386 | |||||||
Common stock issued pursuant to special dividends (Note 11) |
(148,746 | ) | (487,477 | ) | |
See notes to consolidated financial statements.
29
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2009
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2009
NOTE 1 Organization
Apartment Investment and Management Company, or Aimco, is a Maryland corporation incorporated
on January 10, 1994. We are a self-administered and self-managed real estate investment trust, or
REIT, engaged in the acquisition, ownership, management and redevelopment of apartment properties.
As of December 31, 2009, we owned or managed a real estate portfolio of 870 apartment properties
containing 135,654 apartment units located in 44 states, the District of Columbia and Puerto Rico.
We are one of the largest owners and operators of apartment properties in the United States.
As of December 31, 2009, we:
| owned an equity interest in and consolidated 95,202 units in 426 properties (which we
refer to as consolidated properties), of which 93,098 units were also managed by us; |
||
| owned an equity interest in and did not consolidate 8,478 units in 77 properties (which
we refer to as unconsolidated properties), of which 3,594 units were also managed by us;
and |
||
| provided services for or managed 31,974 units in 367 properties, primarily pursuant to
long-term agreements (including 29,879 units in 345 properties for which we provide asset
management services only, and not also property management services). In certain cases, we
may indirectly own generally less than one percent of the operations of such properties
through a partnership syndication or other fund. |
Through our wholly-owned subsidiaries, AIMCO-GP, Inc. and AIMCO-LP Trust, we own a majority of
the ownership interests in AIMCO Properties, L.P., which we refer to as the Aimco Operating
Partnership. As of December 31, 2009, we held an interest of approximately 93% in the common
partnership units and equivalents of the Aimco Operating Partnership. We conduct substantially all
of our business and own substantially all of our assets through the Aimco Operating Partnership.
Interests in the Aimco Operating Partnership that are held by limited partners other than Aimco are
referred to as OP Units. OP Units include common OP Units, partnership preferred units, or
preferred OP Units, and high performance partnership units, or High Performance Units. The Aimco
Operating Partnerships income is allocated to holders of common OP Units based on the weighted
average number of common OP Units outstanding during the period. The Aimco Operating Partnership
records the issuance of common OP Units and the assets acquired in purchase transactions based on
the market price of Aimco Class A Common Stock (which we refer to as Common Stock) at the date of
closing of the transaction. The holders of the common OP Units and Class I High Performance Units
receive distributions, prorated from the date of issuance, in an amount equivalent to the dividends
paid to holders of Common Stock. Holders of common OP Units may redeem such units for cash or, at
the Aimco Operating Partnerships option, Common Stock. During 2009, 2008 and 2007, the weighted
average ownership interest in the Aimco Operating Partnership held by the common OP Unit holders
was approximately 7%, 10% and 9%, respectively. Preferred OP Units entitle the holders thereof to
a preference with respect to distributions or upon liquidation. At December 31, 2009, 116,479,791
shares of our Common Stock were outstanding and the Aimco Operating Partnership had 8,374,233
common OP Units and equivalents outstanding for a combined total of 124,854,024 shares of Common
Stock and OP Units outstanding (excluding preferred OP Units).
Except as the context otherwise requires, we, our, us and the Company refer to Aimco,
the Aimco Operating Partnership and their consolidated entities, collectively.
NOTE 2 Basis of Presentation and Summary of Significant Accounting Policies
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of Aimco, the Aimco
Operating Partnership, and their consolidated entities. We consolidate all variable interest
entities for which we are the primary beneficiary. Generally, we consolidate real estate
partnerships and other entities that are not variable interest entities when we own, directly or
indirectly, a majority voting interest in the entity or are otherwise able to control the entity.
All significant intercompany balances and transactions have been eliminated in consolidation.
30
Interests in the Aimco Operating Partnership that are held by limited partners other than
Aimco are reflected in the accompanying balance sheets as noncontrolling interests in Aimco
Operating Partnership. Interests in partnerships consolidated into the Aimco Operating Partnership
that are held by third parties are reflected in the accompanying balance sheets as noncontrolling
interests in consolidated real estate partnerships. The assets of consolidated real estate
partnerships owned or controlled by us generally are not available to pay creditors of Aimco or the
Aimco Operating Partnership.
As used herein, and except where the context otherwise requires, partnership refers to a
limited partnership or a limited liability company and partner refers to a partner in a limited
partnership or a member in a limited liability company.
Variable Interest Entities
We consolidate all variable interest entities for which we are the primary beneficiary.
Generally, a variable interest entity, or VIE, is an entity with one or more of the following
characteristics: (a) the total equity investment at risk is not sufficient to permit the entity to
finance its activities without additional subordinated financial support; (b) as a group, the
holders of the equity investment at risk lack (i) the ability to make decisions about an entitys
activities through voting or similar rights, (ii) the obligation to absorb the expected losses of
the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the
equity investors have voting rights that are not proportional to their economic interests and
substantially all of the entitys activities either involve, or are conducted on behalf of, an
investor that has disproportionately few voting rights. The primary beneficiary generally is the
entity that will receive a majority of the VIEs expected losses, receive a majority of the VIEs
expected residual returns, or both.
In determining whether we are the primary beneficiary of a VIE, we consider qualitative and
quantitative factors, including, but not limited to: the amount and characteristics of our
investment; the obligation or likelihood for us or other investors to provide financial support;
our and the other investors ability to control or significantly influence key decisions for the
VIE; and the similarity with and significance to the business activities of us and the other
investors. Significant judgments related to these determinations include estimates about the
current and future fair values and performance of real estate held by these VIEs and general market
conditions.
As of December 31, 2009, we were the primary beneficiary of, and therefore consolidated, 90
VIEs, which owned 67 apartment properties with 9,652 units. Real estate with a carrying amount of
$769.4 million collateralized $474.3 million of debt of those VIEs. The creditors of the
consolidated VIEs do not have recourse to our general credit. As of December 31, 2009, we also
held variable interests in 120 VIEs for which we were not the primary beneficiary. Those VIEs
consist primarily of partnerships that are engaged, directly or indirectly, in the ownership and
management of 172 apartment properties with 9,566 units. We are involved with those VIEs as an
equity holder, lender, management agent, or through other contractual relationships. At December
31, 2009, our maximum exposure to loss as a result of our involvement with unconsolidated VIEs is
limited to our recorded investments in and receivables from those VIEs totaling $107.5 million and
our contractual obligation to advance funds to certain VIEs totaling $4.6 million. We may be
subject to additional losses to the extent of any financial support that we voluntarily provide in
the future. Additionally, the provision of financial support in the future may require us to
consolidate a VIE.
In December 2009, the FASB issued Accounting Standards Update 2009-17, Improvements to
Financial Reporting by Enterprises Involved with Variable Interest Entities, or ASU 2009-17, which
is effective for fiscal years beginning after November 15, 2009. ASU 2009-17, which modifies the
guidance in FASB ASC Topic 810, introduces a more qualitative approach to evaluating VIEs for
consolidation and requires a company to perform an analysis to determine whether its variable
interests give it a controlling financial interest in a VIE. This analysis identifies the primary
beneficiary of a VIE as the entity that has (a) the power to direct the activities of the VIE that
most significantly impact the VIEs economic performance, and (b) the obligation to absorb losses
or the right to receive benefits that could potentially be significant to the VIE. In determining
whether it has the power to direct the activities of the VIE that most significantly affect the
VIEs performance, ASU 2009-17 requires a company to assess whether it has an implicit financial
responsibility to ensure that a VIE operates as designed, requires continuous reassessment of
primary beneficiary status rather than periodic, event-driven assessments as previously required,
and incorporates expanded disclosure requirements.
31
Our adoption of ASU 2009-17 during 2010 may result in changes in our conclusions regarding
whether we are required to consolidate certain unconsolidated real estate partnerships that are
VIEs. As of December 31, 2009, in addition to the unconsolidated VIEs discussed above, we held
insignificant partnership interests in VIEs that own approximately 250 properties. We hold general
and/or limited partner interests generally ranging from less than 1% to 5% and our recorded
investment in these entities is typically limited to accounts receivable from our provision of
property management and asset management services to these partnerships. We may be required to
consolidate some of these VIEs if we conclude that we control the activities that are significant
to the VIEs economic performance. Additionally, we may be required to deconsolidate certain VIEs
that we currently consolidate if we conclude we do not control the activities that are significant
to such VIEs economic performance. We have not yet completed our evaluation of ASU 2009-17 and
therefore have not determined the effect our adoption of ASU 2009-17 will have on our consolidated
financial statements.
Acquisition of Real Estate Assets and Related Depreciation and Amortization
We capitalize the purchase price and incremental direct costs associated with the acquisition
of properties as the cost of the assets acquired. We allocate the cost of acquired properties to
tangible assets and identified intangible assets based on their fair values. We determine the fair
value of tangible assets, such as land, building, furniture, fixtures and equipment, on an as-if
vacant basis, generally using internal valuation techniques that consider comparable market
transactions, discounted cash flow techniques, replacement costs and other available information.
We determine the fair value of identified intangible assets (or liabilities), which typically
relate to in-place leases, using internal valuation techniques that consider the terms of the
in-place leases, current market data for comparable leases, and our experience in leasing similar
properties. The intangible assets or liabilities related to in-place leases are comprised of:
1. | The value of the above- and below-market leases in-place. An asset or liability is
recognized based on the difference between (a) the contractual amounts to be paid pursuant
to the in-place leases and (b) our estimate of fair market lease rates for the
corresponding in-place leases, measured over the period, including estimated lease renewals
for below-market leases, that the leases are expected to remain in effect. |
||
2. | The estimated unamortized portion of avoided leasing commissions and other costs that
ordinarily would be incurred to acquire the in-place leases. |
||
3. | The value associated with vacant units during the absorption period (estimates of lost
rental revenue during the expected lease-up periods based on current market demand and
stabilized occupancy levels). |
The values of the above- and below-market leases are amortized to rental revenue over the
expected remaining terms of the associated leases. Other intangible assets related to in-place
leases are amortized to depreciation and amortization over the expected remaining terms of the
associated leases. Amortization is adjusted, as necessary, to reflect any early lease terminations
that were not anticipated in determining amortization periods.
Depreciation for all tangible real estate assets is calculated using the straight-line method
over their estimated useful lives. Acquired buildings and improvements are depreciated over a
composite life of 14 to 52 years, based on the age, condition and other physical characteristics of
the property. As discussed under Impairment of Long Lived Assets below, we may adjust depreciation
of properties that are expected to be disposed of or demolished prior to the end of their useful
lives. Furniture, fixtures and equipment associated with acquired properties are depreciated over
five years.
At December 31, 2009 and 2008, deferred income in our consolidated balance sheets includes
below-market lease amounts totaling $31.8 million and $36.2 million, respectively, which are net of
accumulated amortization of $21.0 million and $16.6 million, respectively. Additions to
below-market leases resulting from acquisitions during the year ended December 31, 2007 totaled
$18.9 million, and there were no such additions during the years ended December 31, 2009 or 2008.
During the years ended December 31, 2009, 2008 and 2007, we included amortization of below-market
leases of $4.4 million, $4.4 million and $4.6 million, respectively, in rental and other property
revenues in our consolidated statements of income. During the year ended December 31, 2008, we
revised the estimated fair value of assets acquired and liabilities assumed in acquisitions
completed in 2007, resulting in a $4.7 million reduction of below-market lease values and a
corresponding reduction in buildings and improvements. At December 31, 2009, our below-market
leases had a weighted average amortization period of 7.1 years and estimated aggregate amortization
for each of the five succeeding years as follows (in millions):
2010 | 2011 | 2012 | 2013 | 2014 | ||||||||||||||||
Estimated amortization |
$ | 3.9 | $ | 3.6 | $ | 3.2 | $ | 2.8 | $ | 2.5 |
32
Capital Additions and Related Depreciation
We capitalize costs, including certain indirect costs, incurred in connection with our capital
additions activities, including redevelopment and construction projects, other tangible property
improvements, and replacements of existing property components. Included in these capitalized
costs are payroll costs associated with time spent by site employees in connection with the
planning, execution and control of all capital additions activities at the property level. We
characterize as indirect costs an allocation of certain department costs, including payroll, at
the area operations and corporate levels that clearly relate to capital additions activities. We
capitalize interest, property taxes and insurance during periods in which redevelopment and
construction projects are in progress. We charge to expense as incurred costs that do not relate
to capital expenditure activities, including ordinary repairs, maintenance, resident turnover costs
and general and administrative expenses.
We depreciate capitalized costs using the straight-line method over the estimated useful life
of the related component or improvement, which is generally five, 15 or 30 years. All capitalized
site payroll and indirect costs are allocated proportionately, based on direct costs, among capital
projects and depreciated over the estimated useful lives of such projects.
Certain homogeneous items that are purchased in bulk on a recurring basis, such as carpeting
and appliances, are depreciated using group methods that reflect the average estimated useful life
of the items in each group. Except in the case of property casualties, where the net book value of
lost property is written off in the determination of casualty gains or losses, we generally do not
recognize any loss in connection with the replacement of an existing property component because
normal replacements are considered in determining the estimated useful lives used in connection
with our composite and group depreciation methods.
For the years ended December 31, 2009, 2008 and 2007, for continuing and discontinued
operations, we capitalized $9.8 million, $25.7 million and $30.8 million, respectively, of interest
costs, and $40.0 million, $78.1 million and $78.1 million, respectively, of site payroll and
indirect costs, respectively.
Impairment of Long-Lived Assets
Our real estate and other long-lived assets classified as held for use are stated at cost,
less accumulated depreciation and amortization, unless the carrying amounts are not recoverable.
If events or circumstances indicate that the carrying amount of a property may not be recoverable,
we make an assessment of its recoverability by comparing the carrying amount to our estimate of the
undiscounted future cash flows, excluding interest charges, of the property. If the carrying
amount exceeds the aggregate undiscounted future cash flows, we recognize an impairment loss to the
extent the carrying amount exceeds the estimated fair value of the property.
In connection with the preparation of our 2008 annual financial statements, we assessed the
recoverability of our investment in our Lincoln Place property, located in Venice, California.
Based upon the declines in land values in Southern California during 2008 and the expected timing
of our redevelopment efforts, we determined that the total carrying amount of the property was no
longer probable of full recovery and, accordingly, during the three months ended December 31, 2008,
recognized an impairment loss of $85.4 million ($55.6 million net of tax).
Similarly, we assessed the recoverability of our investment in Pacific Bay Vistas (formerly
Treetops), a vacant property located in San Bruno, California, and determined that the carrying
amount of the property was no longer probable of full recovery and, accordingly, we recognized an
impairment loss of $5.7 million for this property during the three months ended December 31, 2008.
In addition to the impairments of Lincoln Place and Pacific Bay Vistas, based on periodic
tests of recoverability of long-lived assets, for the years ended December 31, 2009 and 2007, we
recorded real estate impairment losses of $2.3 million and $1.1 million, respectively, related to
properties classified as held for use. For the year ended December 31, 2008, we recorded no
similar impairment losses related to properties classified as held for use.
We report impairment losses or recoveries related to properties sold or classified as held for
sale in discontinued operations.
Our tests of recoverability address real estate assets that do not currently meet all
conditions to be classified as held for sale, but are expected to be disposed of prior to the end
of their estimated useful lives. If an impairment loss is not required to be recorded, the
recognition of depreciation is adjusted prospectively, as necessary, to reduce the carrying amount
of the real estate to its estimated disposition value over the remaining period that the real
estate is expected to be
held and used. We also may adjust depreciation prospectively to reduce to zero the carrying
amount of buildings that we plan to demolish in connection with a redevelopment project. These
depreciation adjustments, after adjustments for noncontrolling interests, decreased net income
available to Aimco common stockholders by $18.3 million, $10.7 million and $33.8 million, and
resulted in decreases in basic and diluted earnings per share of $0.16, $0.12 and $0.35, for the
years ended December 31, 2009, 2008 and 2007, respectively.
33
Cash Equivalents
We classify highly liquid investments with an original maturity of three months or less as
cash equivalents.
Restricted Cash
Restricted cash includes capital replacement reserves, completion repair reserves, bond
sinking fund amounts and tax and insurance escrow accounts held by lenders.
Accounts Receivable and Allowance for Doubtful Accounts
Accounts receivable are generally comprised of amounts receivable from residents, amounts
receivable from non-affiliated real estate partnerships for which we provide property management
and other services and other miscellaneous receivables from non-affiliated entities. We evaluate
collectibility of accounts receivable from residents and establish an allowance, after the
application of security deposits and other anticipated recoveries, for accounts greater than 30
days past due for current residents and all receivables due from former residents. Accounts
receivable from residents are stated net of allowances for doubtful accounts of approximately $1.4
million and $3.3 million as of December 31, 2009 and 2008, respectively.
We evaluate collectibility of accounts receivable from non-affiliated entities and establish
an allowance for amounts that are considered to be uncollectible. Accounts receivable relating to
non-affiliated entities are stated net of allowances for doubtful accounts of approximately $5.4
million and $5.0 million as of December 31, 2009 and 2008, respectively.
Accounts Receivable and Allowance for Doubtful Accounts from Affiliates
Accounts receivable from affiliates are generally comprised of receivables related to property
management and other services provided to unconsolidated real estate partnerships in which we have
an ownership interest. We evaluate collectibility of accounts receivable balances from affiliates
on a periodic basis, and establish an allowance for the amounts deemed to be uncollectible.
Accounts receivable from affiliates are stated net of allowances for doubtful accounts of
approximately $1.9 million and $2.8 million as of December 31, 2009 and 2008, respectively.
Deferred Costs
We defer lender fees and other direct costs incurred in obtaining new financing and amortize
the amounts over the terms of the related loan agreements. Amortization of these costs is included
in interest expense.
We defer leasing commissions and other direct costs incurred in connection with successful
leasing efforts and amortize the costs over the terms of the related leases. Amortization of these
costs is included in depreciation and amortization.
Notes Receivable from Unconsolidated Real Estate Partnerships and Non-Affiliates and Related
Interest Income and Provision for Losses
Notes receivable from unconsolidated real estate partnerships consist primarily of notes
receivable from partnerships in which we are the general partner but do not consolidate the
partnership. The ultimate repayment of these notes and those from non-affiliates is subject to a
number of variables, including the performance and value of the underlying real estate property and
the claims of unaffiliated mortgage lenders. Our notes receivable include loans extended by us
that we carry at the face amount plus accrued interest, which we refer to as par value notes, and
loans extended by predecessors whose positions we generally acquired at a discount, which we refer
to as discounted notes.
We record interest income on par value notes as earned in accordance with the terms of the
related loan agreements. We discontinue the accrual of interest on such notes when the notes are
impaired, as discussed below, or when there is otherwise significant uncertainty as to the
collection of interest. We record income on such nonaccrual loans using the cost recovery method,
under which we apply cash receipts first to the recorded amount of the loan; thereafter, any
additional receipts are recognized as income.
34
We recognize interest income on discounted notes receivable based upon whether the amount and
timing of collections are both probable and reasonably estimable. We consider collections to be
probable and reasonably estimable when the borrower has closed or entered into certain pending
transactions (which include real estate sales, refinancings, foreclosures and rights offerings)
that provide a reliable source of repayment. In such instances, we recognize accretion income, on
a prospective basis using the effective interest method over the estimated remaining term of the
loans, equal to the difference between the carrying amount of the discounted notes and the
estimated collectible value. We record income on all other discounted notes using the cost
recovery method.
We assess the collectibility of notes receivable on a periodic basis, which assessment
consists primarily of an evaluation of cash flow projections of the borrower to determine whether
estimated cash flows are sufficient to repay principal and interest in accordance with the
contractual terms of the note. We recognize impairments on notes receivable when it is probable
that principal and interest will not be received in accordance with the contractual terms of the
loan. The amount of the impairment to be recognized generally is based on the fair value of the
partnerships real estate that represents the primary source of loan repayment. In certain
instances where other sources of cash flow are available to repay the loan, the impairment is
measured by discounting the estimated cash flows at the loans original effective interest rate.
See Note 5 for further discussion of Notes Receivable.
Investments in Unconsolidated Real Estate Partnerships
We own general and limited partner interests in real estate partnerships that own apartment
properties. We generally account for investments in real estate partnerships that we do not
consolidate under the equity method. Under the equity method, our share of the earnings or losses
of the entity for the periods being presented is included in equity in earnings (losses) from
unconsolidated real estate partnerships, except for our share of impairments and property
disposition gains related to such entities, which we report separately in the consolidated
statements of income. Certain investments in real estate partnerships that were acquired in
business combinations were determined to have insignificant value at the acquisition date and are
accounted for under the cost method. Any distributions received from such partnerships are
recognized as income when received.
The excess of the cost of the acquired partnership interests over the historical carrying
amount of partners equity or deficit is ascribed generally to the fair values of land and
buildings owned by the partnerships. We amortize the excess cost related to the buildings over the
estimated useful lives of the buildings. Such amortization is recorded as a component of equity in
earnings (losses) of unconsolidated real estate partnerships.
Intangible Assets
At December 31, 2009 and 2008, other assets included goodwill associated with our real estate
segment of $71.8 million and $81.9 million, respectively. We perform an annual impairment test of
goodwill that compares the fair value of reporting units with their carrying amounts, including
goodwill. We determined that our goodwill was not impaired in 2009, 2008 or 2007.
During the year ended December 31, 2009, we allocated $10.1 million of goodwill related to our
real estate segment to the carrying amounts of the properties sold or classified as held for sale.
The amounts of goodwill allocated to these properties were based on the relative fair values of the
properties sold or classified as held for sale and the retained portions of the reporting units to
which the goodwill as allocated. During 2008 and 2007, we did not allocate any goodwill to
properties sold or classified as held for sale as real estate properties were not considered
businesses under then applicable accounting principles generally accepted in the United States of
America, or GAAP.
Other assets also includes intangible assets for purchased management contracts with finite
lives that we amortize on a straight-line basis over terms ranging from five to 20 years and
intangible assets for in-place leases as discussed under Acquisition of Real Estate Assets and
Related Depreciation and Amortization.
Capitalized Software Costs
Purchased software and other costs related to software developed for internal use are
capitalized during the application development stage and are amortized using the straight-line
method over the estimated useful life of the software, generally five years. We write-off the
costs of software development projects when it is no longer probable that the software will be
completed and placed in service. For the years ended December 31, 2009, 2008 and 2007, we
capitalized software development costs totaling $5.6 million, $20.9 million and $11.9 million,
respectively. At December 31, 2009 and 2008, other assets included $29.7 million and $35.7 million
of net capitalized software, respectively. During the years ended December 31, 2009, 2008 and
2007, we recognized amortization of capitalized
software of $11.5 million, $10.0 million and $10.8 million, respectively, which is included in
depreciation and amortization in our consolidated statements of income.
35
During the year ended December 31, 2008, we reassessed our approach to communication
technology needs at our properties, which resulted in the discontinuation of an infrastructure
project and a $5.4 million write-off of related hardware and capitalized internal and consulting
costs included in other assets. The write-off, which is net of sales proceeds, is included in
other expenses, net. During the year ended December 31, 2008, we additionally recorded a $1.6
million write-off of certain software and hardware assets that are no longer consistent with our
information technology strategy. This write-off is included in depreciation and amortization.
During the year ended December 31, 2007, we abandoned certain internal-use software development
projects and recorded a $4.2 million write-off of the capitalized costs of such projects in
depreciation and amortization. There were no similar write-offs during the year ended December 31,
2009.
Noncontrolling Interests in Consolidated Real Estate Partnerships
We report the unaffiliated partners interests in our consolidated real estate partnerships as
noncontrolling interests in consolidated real estate partnerships. Noncontrolling interests in
consolidated real estate partnerships represent the noncontrolling partners share of the
underlying net assets of our consolidated real estate partnerships. Prior to 2009, when these
consolidated real estate partnerships made cash distributions to partners in excess of the carrying
amount of the noncontrolling interest, we generally recorded a charge equal to the amount of such
excess distribution, even though there was no economic effect or cost. These charges are reported
in the consolidated statements of income for the years ended December 31, 2008 and 2007 within
noncontrolling interests in consolidated real estate partnerships. Also prior to 2009, we
allocated the noncontrolling partners share of partnership losses to noncontrolling partners to
the extent of the carrying amount of the noncontrolling interest. We generally recorded a charge
when the noncontrolling partners share of partnership losses exceed the carrying amount of the
noncontrolling interest, even though there is no economic effect or cost. These charges are
reported in the consolidated statements of income within noncontrolling interests in consolidated
real estate partnerships. We did not record charges for distributions or losses in certain limited
instances where the noncontrolling partner had a legal obligation and financial capacity to
contribute additional capital to the partnership. For the years ended December 31, 2008 and 2007,
we recorded charges for partnership losses resulting from depreciation of approximately $9.0
million and $12.2 million, respectively that were not allocated to noncontrolling partners because
the losses exceeded the carrying amount of the noncontrolling interest.
Noncontrolling interests in consolidated real estate partnerships consist primarily of equity
interests held by limited partners in consolidated real estate partnerships that have finite lives.
The terms of the related partnership agreements generally require the partnership to be liquidated
following the sale of the partnerships real estate. As the general partner in these partnerships,
we ordinarily control the execution of real estate sales and other events that could lead to the
liquidation, redemption or other settlement of noncontrolling interests. The aggregate carrying
amount of noncontrolling interests in consolidated real estate partnerships is approximately $316.2
million at December 31, 2009. The aggregate fair value of these interests varies based on the fair
value of the real estate owned by the partnerships. Based on the number of classes of finite-life
noncontrolling interests, the number of properties in which there is direct or indirect
noncontrolling ownership, complexities in determining the allocation of liquidation proceeds among
partners and other factors, we believe it is impracticable to determine the total required payments
to the noncontrolling interests in an assumed liquidation at December 31, 2009. As a result of
real estate depreciation that is recognized in our financial statements and appreciation in the
fair value of real estate that is not recognized in our financial statements, we believe that the
aggregate fair value of our noncontrolling interests exceeds their aggregate carrying amount. As a
result of our ability to control real estate sales and other events that require payment of
noncontrolling interests and our expectation that proceeds from real estate sales will be
sufficient to liquidate related noncontrolling interests, we anticipate that the eventual
liquidation of these noncontrolling interests will not have an adverse impact on our financial
condition.
Revenue Recognition
Our properties have operating leases with apartment residents with terms generally of 12
months or less. We recognize rental revenue related to these leases, net of any concessions, on a
straight-line basis over the term of the lease. We recognize revenues from property management,
asset management, syndication and other services when the related fees are earned and are realized
or realizable.
36
Advertising Costs
We generally expense all advertising costs as incurred to property operating expense. For the
years ended December 31, 2009, 2008 and 2007, for both continuing and discontinued operations,
total advertising expense was $25.0 million, $36.0 million and $38.0 million, respectively.
Insurance
We believe that our insurance coverages insure our properties adequately against the risk of
loss attributable to fire, earthquake, hurricane, tornado, flood, and other perils. In addition, we
have insurance coverage for substantial portions of our property, workers compensation, health,
and general liability exposures. Losses are accrued based upon our estimates of the aggregate
liability for uninsured losses incurred using certain actuarial assumptions followed in the
insurance industry and based on our experience.
Stock-Based Compensation
We recognize all stock-based employee compensation, including grants of employee stock
options, in the consolidated financial statements based on the grant date fair value and recognize
compensation cost, which is net of estimates for expected forfeitures, ratably over the awards
requisite service period. See Note 12 for further discussion of our stock-based compensation.
Tax Credit Arrangements
We sponsor certain partnerships that own and operate apartment properties that qualify for tax
credits under Section 42 of the Internal Revenue Code of 1986, as amended, which we refer to as the
Code, and for the U.S. Department of Housing and Urban Development, or HUD, subsidized rents under
HUDs Section 8 program. These partnerships acquire, develop and operate qualifying affordable
housing properties and are structured to provide for the pass-through of tax credits and deductions
to their partners. The tax credits are generally realized ratably over the first ten years of the
tax credit arrangement and are subject to the partnerships compliance with applicable laws and
regulations for a period of 15 years. Typically, we are the general partner with a legal ownership
interest of one percent or less. We market limited partner interests of at least 99 percent to
unaffiliated institutional investors (which we refer to as tax credit investors or investors) and
receive a syndication fee from each investor upon such investors admission to the partnership. At
inception, each investor agrees to fund capital contributions to the partnerships. We agree to
perform various services to the partnerships in exchange for fees over the expected duration of the
tax credit service period. The related partnership agreements generally require adjustment of each
tax credit investors required capital contributions if actual tax benefits to such investor differ
from projected amounts.
We have determined that the partnerships in these arrangements are variable interest entities
and, where we are general partner, we are generally the primary beneficiary that is required to
consolidate the partnerships. When the contractual arrangements obligate us to deliver tax
benefits to the investors, and entitle us through fee arrangements to receive substantially all
available cash flow from the partnerships, we account for these partnerships as wholly owned
subsidiaries. Capital contributions received by the partnerships from tax credit investors
represent, in substance, consideration that we receive in exchange for our obligation to deliver
tax credits and other tax benefits to the investors, and the receipts are recognized as revenue in
our consolidated financial statements when our obligation to the investors is relieved upon
delivery of the expected tax benefits.
In summary, our accounting treatment recognizes the income or loss generated by the underlying
real estate based on our economic interest in the partnerships. Proceeds received in exchange for
the transfer of the tax credits are recognized as revenue proportionately as the tax benefits are
delivered to the tax credit investors and our obligation is relieved. Syndication fees and related
costs are recognized in income upon completion of the syndication effort. We recognize syndication
fees in amounts determined based on a market rate analysis of fees for comparable services, which
generally fell within a range of 10% to 15% of investor contributions during the periods presented.
Other direct and incremental costs incurred in structuring these arrangements are deferred and
amortized over the expected duration of the arrangement in proportion to the recognition of related
income. Investor contributions in excess of recognized revenue are reported as deferred income in
our consolidated balance sheets.
During the years ended December 31, 2008 and 2007, we recognized syndication fee income of
$3.4 million and $13.8 million, respectively. We recognized no syndication fee income during the
year ended December 31, 2009. During the years ended December 31, 2009, 2008 and 2007 we recognized
revenue associated with the delivery of tax benefits of $36.6 million, $29.4 million and $24.0
million, respectively. At December 31, 2009 and 2008, $148.1
million and $159.6 million, respectively, of investor contributions in excess of the
recognized revenue were included in deferred income in our consolidated balance sheets.
37
Discontinued Operations
We classify certain properties and related assets and liabilities as held for sale when they
meet certain criteria. The operating results of such properties as well as those properties sold
during the periods presented are included in discontinued operations in both current periods and
all comparable periods presented. Depreciation is not recorded on properties once they have been
classified as held for sale; however, depreciation expense recorded prior to classification as held
for sale is included in discontinued operations. The net gain on sale and any impairment losses
are presented in discontinued operations when recognized. See Note 13 for additional information
regarding discontinued operations.
Derivative Financial Instruments
We primarily use long-term, fixed-rate and self-amortizing non-recourse debt to avoid, among
other things, risk related to fluctuating interest rates. For our variable rate debt, we are
sometimes required by our lenders to limit our exposure to interest rate fluctuations by entering
into interest rate swap or cap agreements. The interest rate swap agreements moderate our exposure
to interest rate risk by effectively converting the interest on variable rate debt to a fixed rate.
The interest rate cap agreements effectively limit our exposure to interest rate risk by providing
a ceiling on the underlying variable interest rate. The fair values of the interest rate swaps are
reflected as assets or liabilities in the balance sheet, and periodic changes in fair value are
included in interest expense or equity, as appropriate. These interest rate caps are not material
to our financial position or results of operations.
As of December 31, 2009 and 2008, we had interest rate swaps with aggregate notional amounts
of $52.3 million and $27.2 million, and recorded fair values of $1.6 million and $2.6 million,
respectively, reflected in accrued liabilities and other in our consolidated balance sheets. At
December 31, 2009, these interest rate swaps had a weighted average term of 11.1 years. We have
designated these interest rate swaps as cash flow hedges and recognize any changes in their fair
value as an adjustment of accumulated other comprehensive income within equity to the extent of
their effectiveness. For the year ended December 31, 2009, we recognized changes in fair value of
$1.0 million, of which $1.4 million resulted in an adjustment to accumulated other comprehensive
loss within consolidated equity. For the year ended December 31, 2008, we recognized changes in
fair value of $2.2 million, of which $2.1 million resulted in an adjustment to accumulated other
comprehensive loss within consolidated equity. We recognized $0.4 million and less than $0.1
million of ineffectiveness as an adjustment of interest expense during the years ended December 31,
2009 and 2008, respectively, and we recognized no ineffectiveness during the year ended December
31, 2007. Our consolidated comprehensive loss for the year ended December 31, 2009 totaled $43.4
million and our comprehensive income for the years ended December 31, 2008 and 2007, totaled $624.9
million and $124.8 million, respectively, before the effects of noncontrolling interests. If the
forward rates at December 31, 2009 remain constant, we estimate that during the next twelve months,
we would reclassify into earnings approximately $1.5 million of the unrealized losses in
accumulated other comprehensive income.
We have entered into total rate of return swaps on various fixed rate secured tax-exempt bonds
payable and fixed rate notes payable to convert these borrowings from a fixed rate to a variable
rate and provide an efficient financing product to lower our cost of borrowing. In exchange for
our receipt of a fixed rate generally equal to the underlying borrowings interest rate, the total
rate of return swaps require that we pay a variable rate, equivalent to the Securities Industry and
Financial Markets Association Municipal Swap Index, or SIFMA, rate for tax-exempt bonds payable and
the 30-day LIBOR rate for notes payable, plus a risk spread. These swaps generally have a second
or third lien on the property collateralized by the related borrowings and the obligations under
certain of these swaps are cross-collateralized with certain of the other swaps with a particular
counterparty. The underlying borrowings are generally callable at our option, with no prepayment
penalty, with 30 days advance notice, and the swaps generally have a term of less than five years.
The total rate of return swaps have a contractually defined termination value generally equal to
the difference between the fair value and the counterpartys purchased value of the underlying
borrowings, which may require payment by us or to us for such difference. Accordingly, we believe
fluctuations in the fair value of the borrowings from the inception of the hedging relationship
generally will be offset by a corresponding fluctuation in the fair value of the total rate of
return swaps.
We designate total rate of return swaps as hedges of the risk of overall changes in the fair
value of the underlying borrowings. At each reporting period, we estimate the fair value of these
borrowings and the total rate of return swaps and recognize any changes therein as an adjustment of
interest expense. We evaluate the effectiveness of these fair value hedges at the end of each
reporting period and recognize an adjustment of interest expense as a result of any
ineffectiveness.
38
Borrowings payable subject to total rate of return swaps with aggregate outstanding principal
balances of $352.7 million and $421.7 million at December 31, 2009 and 2008, respectively, are
reflected as variable rate borrowings in Note 6. Due to changes in the estimated fair values of
these debt instruments and the corresponding total rate of return swaps, we increased property
loans payable by $5.2 million for the year ended December 31, 2009, and reduced property loans
payable by $20.1 million and $9.4 million for the years ended December 31, 2008 and 2007,
respectively, with offsetting adjustments to accrued liabilities, resulting in no net effect on net
income. Refer to Fair Value Measurements for further discussion of fair value measurements related
to these arrangements. During 2009, 2008 and 2007, we determined these hedges were fully effective
and accordingly we made no adjustments to interest expense for ineffectiveness.
At December 31, 2009, the weighted average fixed receive rate under the total return swaps was
6.8% and the weighted average variable pay rate was 1.0%, based on the applicable SIFMA and 30-day
LIBOR rates effective as of that date. Further information related to our total return swaps as of
December 31, 2009 is as follows (dollars in millions):
Weighted | ||||||||||||||||||||
Year of | Average | Swap | Weighted Average Swap | |||||||||||||||||
Debt | Debt Interest | Swap Notional | Maturity | Variable Pay Rate at | ||||||||||||||||
Debt Principal | Maturity | Rate | Amount | Date | December 31, 2009 | |||||||||||||||
$ | 45.2 | 2012 | 7.5 | % | $ | 45.2 | 2012 | 1.6 | % | |||||||||||
24.0 | 2015 | 6.9 | % | 24.0 | 2012 | 1.0 | % | |||||||||||||
14.2 | 2018 | 7.3 | % | 14.2 | 2012 | 1.0 | % | |||||||||||||
42.8 | 2025 | 7.0 | % | 42.8 | 2012 | 1.0 | % | |||||||||||||
93.0 | 2031 | 7.4 | % | 93.0 | 2012 | 1.0 | % | |||||||||||||
108.7 | 2036 | 6.2 | % | 109.1 | 2012 | 0.7 | % | |||||||||||||
12.3 | 2038 | 5.5 | % | 12.3 | 2012 | 0.9 | % | |||||||||||||
12.5 | 2048 | 6.5 | % | 12.5 | 2012 | 0.9 | % | |||||||||||||
$ | 352.7 | $ | 353.1 | |||||||||||||||||
Fair Value Measurements
Beginning in 2008, we applied the FASBs revised accounting provisions related to fair value
measurements, which are codified in FASB ASC Topic 820. These revised provisions define fair value
as the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date, establish a hierarchy that
prioritizes the information used in developing fair value estimates and require disclosure of fair
value measurements by level within the fair value hierarchy. The hierarchy gives the highest
priority to quoted prices in active markets (Level 1 measurements) and the lowest priority to
unobservable data (Level 3 measurements), such as the reporting entitys own data. We adopted the
revised fair value measurement provisions that apply to recurring and nonrecurring fair value
measurements of financial assets and liabilities effective January 1, 2008, and the provisions that
apply to the remaining fair value measurements effective January 1, 2009, and at those times
determined no transition adjustments were required.
The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset
or liability as of the measurement date and includes three levels defined as follows:
Level 1
|
Unadjusted quoted prices for identical and unrestricted assets or liabilities in active markets | |
Level 2
|
Quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument | |
Level 3
|
Unobservable inputs that are significant to the fair value measurement |
A financial instruments categorization within the valuation hierarchy is based upon the
lowest level of input that is significant to the fair value measurement.
39
Following are descriptions of the valuation methodologies used for our significant assets or
liabilities measured at fair value on a recurring or nonrecurring basis. Although some of the
valuation methodologies use observable market inputs in limited instances, the majority of inputs
we use are unobservable and are therefore classified within Level 3 of the valuation hierarchy.
Provisions for Real Estate Impairment Losses
If events or circumstances indicate that the carrying amount of a property may not be
recoverable, we make an assessment of its recoverability by comparing the carrying amount to
our estimate of the undiscounted future cash flows, excluding interest charges, of the
property. If the carrying amount exceeds the aggregate undiscounted future cash flows, we
recognize an impairment loss to the extent the carrying amount exceeds the estimated fair
value of the property, for properties classified as held for use, and estimated fair value of
the property, less estimated selling costs, for properties classified as held for sale.
We estimate the fair value of real estate using income and market valuation techniques
using information such as broker estimates, purchase prices for recent transactions on
comparable assets and net operating income capitalization analyses using observable and
unobservable inputs such as capitalization rates, asset quality grading, geographic location
analysis, and local supply and demand observations. For certain properties classified as
held for sale, we may also recognize the impairment loss based on the contract sale price,
which we believe is representative of fair value, less estimated selling costs.
Notes Receivable
We assess the collectibility of notes receivable on a periodic basis, which assessment
consists primarily of an evaluation of cash flow projections of the borrower to determine
whether estimated cash flows are sufficient to repay principal and interest in accordance
with the contractual terms of the note. We recognize impairments on notes receivable when it
is probable that principal and interest will not be received in accordance with the
contractual terms of the loan. The amount of the impairment to be recognized generally is
based on the fair value of the real estate, which represents the primary source of loan
repayment. The fair value of real estate is estimated through income and market valuation
approaches using information such as broker estimates, purchase prices for recent
transactions on comparable assets and net operating income capitalization analyses using
observable and unobservable inputs such as capitalization rates, asset quality grading,
geographic location analysis, and local supply and demand observations.
Interest Rate Swaps
We estimate the fair value of interest rate swaps using an income approach with
primarily observable inputs, including information regarding the hedged variable cash flows
and forward yield curves relating to the variable interest rates on which the hedged cash
flows are based.
Total Rate of Return Swaps
Our total rate of return swaps have contractually-defined termination values generally
equal to the difference between the fair value and the counterpartys purchased value of the
underlying borrowings. Upon termination, we are required to pay the counterparty the
difference if the fair value is less than the purchased value, and the counterparty is
required to pay us the difference if the fair value is greater than the purchased value. The
underlying borrowings are generally callable, at our option, at face value prior to maturity
and with no prepayment penalty. Due to our control of the call features in the underlying
borrowings, we believe the inherent value of any differential between the fixed and variable
cash payments due under the swaps would be significantly discounted by a market participant
willing to purchase or assume any rights and obligations under these contracts.
The swaps are generally cross-collateralized with other swap contracts with the same
counterparty and do not allow transfer or assignment, thus there is no alternate or secondary
market for these instruments. Accordingly, our assumptions about the fair value that a
willing market participant would assign in valuing these instruments are based on a
hypothetical market in which the highest and best use of these contracts is in-use in
combination with the related borrowings, similar to how we use the contracts. Based on these
assumptions, we believe the termination value, or exit value, of the swaps approximates the
fair value that
would be assigned by a willing market participant. We calculate the termination value
using a market approach by reference to estimates of the fair value of the underlying
borrowings, which are discussed below, and an evaluation of potential changes in the credit
quality of the counterparties to these arrangements. We compare our estimates of the fair
value of the swaps and related borrowings to the valuations provided by the counterparties on
a quarterly basis.
40
Our method for calculating fair value of the swaps generally results in changes in fair
value equal to the changes in fair value of the related borrowings. Accordingly, we believe
these instruments are highly effective in offsetting the changes in fair value of the
borrowings during the hedging period.
Changes in Fair Value of Borrowings Subject to Total Rate of Return Swaps
We recognize changes in the fair value of certain borrowings subject to total rate of
return swaps, which we have designated as fair value hedges.
We estimate the fair value of debt instruments using an income and market approach,
including comparison of the contractual terms to observable and unobservable inputs such as
market interest rate risk spreads, collateral quality and loan-to-value ratios on similarly
encumbered assets within our portfolio. These borrowings are collateralized and non-recourse
to us; therefore, we believe changes in our credit rating will not materially affect a market
participants estimate of the borrowings fair value.
The methods described above may produce a fair value calculation that may not be indicative of
net realizable value or reflective of future fair values. Furthermore, although we believe our
valuation methods are appropriate and consistent with other market participants, the use of
different methodologies or assumptions to determine the fair value of certain assets and
liabilities could result in a different estimate of fair value at the reporting date.
The table below presents amounts at December 31, 2009, 2008 and 2007 (and the changes in fair
value between such dates) for significant items measured in our consolidated balance sheets at fair
value (in thousands). Certain of these fair value measurements are based on significant
unobservable inputs classified within Level 3 of the valuation hierarchy. When a determination is
made to classify a fair value measurement within Level 3 of the valuation hierarchy, the
determination is based upon the significance of the unobservable factors to the overall fair value
measurement. However, Level 3 fair value measurements typically include, in addition to the
unobservable or Level 3 components, observable components that can be validated to observable
external sources; accordingly, the changes in fair value in the table below are due in part to
observable factors that are part of the valuation methodology.
Level 2 | Level 3 | ||||||||||||||||
Changes in fair | |||||||||||||||||
value of debt | |||||||||||||||||
instruments | |||||||||||||||||
subject to total | |||||||||||||||||
Interest rate | Total rate of | rate of return | |||||||||||||||
swaps | return swaps | swaps | Total | ||||||||||||||
Fair value at December 31, 2007 |
$ | (371 | ) | $ | (9,420 | ) | $ | 9,420 | $ | (371 | ) | ||||||
Unrealized gains (losses)
included in earnings (1)(2) |
(47 | ) | (20,075 | ) | 20,075 | (47 | ) | ||||||||||
Realized gains (losses)
included in earnings |
| | | | |||||||||||||
Unrealized gains (losses)
included in equity |
(2,139 | ) | | | (2,139 | ) | |||||||||||
Fair value at December 31, 2008 |
$ | (2,557 | ) | $ | (29,495 | ) | $ | 29,495 | $ | (2,557 | ) | ||||||
Unrealized gains (losses)
included in earnings (1)(2) |
(447 | ) | 5,188 | (5,188 | ) | (447 | ) | ||||||||||
Realized gains (losses)
included in earnings |
| | | | |||||||||||||
Unrealized gains (losses)
included in equity |
1,408 | | | 1,408 | |||||||||||||
Fair value at December 31, 2009 |
$ | (1,596 | ) | $ | (24,307 | ) | $ | 24,307 | $ | (1,596 | ) | ||||||
(1) | Unrealized gains (losses) relate to periodic revaluations of fair value and have not
resulted from the settlement of a swap position. |
|
(2) | Included in interest expense in the accompanying condensed consolidated statements of
income. |
41
In addition to the amounts in the table above, during the years ended December 31, 2009, 2008
and 2007, we recognized $56.9 million, $118.6 million and $6.5 million, respectively, of provisions
for real estate impairment losses (including amounts in discontinued operations) to reduce the
carrying amounts of certain real estate properties to their estimated fair value (or fair value
less estimated costs to sell) and provisions for losses on notes receivable of $21.5 million, $17.6
million and $2.0 million, respectively, based on our estimates of the fair value of the real estate
properties that represent the primary source of repayment. Based on the significance of the
unobservable inputs used in our methods for estimating the fair values for these amounts, we
classify these fair value measurements within Level 3 of the valuation hierarchy.
Disclosures Regarding Fair Value of Financial Instruments
We believe that the aggregate fair value of our cash and cash equivalents, receivables,
payables and short-term secured debt approximates their aggregate carrying value at December 31,
2009, due to their relatively short-term nature and high probability of realization. We estimate
fair value for our notes receivable and debt instruments using present value techniques that
include income and market valuation approaches using observable inputs such as market rates for
debt with the same or similar terms and unobservable inputs such as collateral quality and
loan-to-value ratios on similarly encumbered assets. Present value calculations vary depending on
the assumptions used, including the discount rate and estimates of future cash flows. In many
cases, the fair value estimates may not be realizable in immediate settlement of the instruments.
The estimated aggregate fair value of our notes receivable was approximately $126.1 million and
$161.6 million at December 31, 2009 and 2008, respectively. See Note 5 for further information on
notes receivable. The estimated aggregate fair value of our consolidated debt (including amounts
reported in liabilities related to assets held for sale) was approximately $5.7 billion and $6.7
billion at December 31, 2009 and 2008, respectively. The combined carrying amount of our
consolidated debt (including amounts reported in liabilities related to assets held for sale) was
approximately $5.7 billion and $6.8 billion at December 31, 2009 and 2008, respectively. See Note
6 and Note 7 for further details on our consolidated debt. Refer to Derivative Financial
Instruments for further discussion regarding certain of our fixed rate debt that is subject to
total rate of return swap instruments.
Income Taxes
We have elected to be taxed as a REIT under the Code commencing with our taxable year ended
December 31, 1994, and intend to continue to operate in such a manner. Our current and continuing
qualification as a REIT depends on our ability to meet the various requirements imposed by the
Code, which are related to organizational structure, distribution levels, diversity of stock
ownership and certain restrictions with regard to owned assets and categories of income. If we
qualify for taxation as a REIT, we will generally not be subject to United States Federal corporate
income tax on our taxable income that is currently distributed to stockholders. This treatment
substantially eliminates the double taxation (at the corporate and stockholder levels) that
generally results from an investment in a corporation.
Even if we qualify as a REIT, we may be subject to United States Federal income and excise
taxes in various situations, such as on our undistributed income. We also will be required to pay a
100% tax on any net income on non-arms length transactions between us and a TRS (described below)
and on any net income from sales of property that was property held for sale to customers in the
ordinary course. We and our stockholders may be subject to state or local taxation in various
state or local jurisdictions, including those in which we transact business or our stockholders
reside. In addition, we could also be subject to the alternative minimum tax, or AMT, on our items
of tax preference. The state and local tax laws may not conform to the United States Federal
income tax treatment. Any taxes imposed on us reduce our operating cash flow and net income.
Certain of our operations or a portion thereof, including property management, asset
management and risk, are conducted through taxable REIT subsidiaries, which are subsidiaries of the
Aimco Operating Partnership, and each of which we refer to as a TRS. A TRS is a C-corporation that
has not elected REIT status and as such is subject to United States Federal corporate income tax.
We use TRS entities to facilitate our ability to offer certain services and activities to our
residents, as these services and activities generally cannot be offered directly by the REIT. We
also use TRS entities to hold investments in certain properties.
42
For our TRS entities, deferred income taxes result from temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and the amounts used
for Federal income tax purposes, and are measured using the enacted tax rates and laws that are
expected to be in effect when the differences reverse. We reduce deferred tax assets by recording
a valuation allowance when we determine based on available evidence that it is more likely than not
that the assets will not be realized. We recognize the tax consequences associated with
intercompany transfers between the REIT and TRS entities when the related assets are sold to third
parties, impaired or otherwise disposed of for financial reporting purposes.
In March 2008, we were notified by the Internal Revenue Service that it intended to examine
the 2006 Federal tax return for the Aimco Operating Partnership. During June 2008, the IRS issued
AIMCO-GP, Inc., the general and tax matters partner of the Aimco Operating Partnership, a summary
report including the IRSs proposed adjustments to the Aimco Operating Partnerships 2006 Federal
tax return. In addition, in May 2009, we were notified by the IRS that it intended to examine the
2007 Federal tax return for the Aimco Operating Partnership. During November 2009, the IRS issued
AIMCO-GP, Inc. a summary report including the IRSs proposed adjustments to the Aimco Operating
Partnerships 2007 Federal tax return. We do not expect the 2006 or 2007 proposed adjustments to
have any material effect on our unrecognized tax benefits, financial condition or results of
operations.
Concentration of Credit Risk
Financial instruments that potentially could subject us to significant concentrations of
credit risk consist principally of notes receivable and total rate of return swaps. As discussed
in Note 5, a significant portion of our notes receivable at December 31, 2009, are collateralized
by properties in the West Harlem area of New York City. There are no other significant
concentrations of credit risk with respect to our notes receivable due to the large number of
partnerships that are borrowers under the notes and the geographic diversity of the properties that
collateralize the notes.
At December 31, 2009, we had total rate of return swap positions with two financial
institutions totaling $353.1 million. The swap positions with one counterparty are comprised of
$340.9 million of fixed rate debt effectively converted to variable rates using total rate of
return swaps, including $295.7 million of tax-exempt bonds indexed to SIFMA and $45.2 million of
taxable second mortgage notes indexed to LIBOR. Additionally, the swap agreements with this
counterparty provide for collateral calls to maintain specified loan-to-value ratios. As of
December 31, 2009, we were not required to provide cash collateral pursuant to the total rate of
return swaps. We have one swap position with another counterparty that is comprised of $12.2
million of fixed rate tax-exempt bonds indexed to SIFMA. We periodically evaluate counterparty
credit risk associated with these arrangements. At the current time, we have concluded we do not
have material exposure. In the event either counterparty were to default under these arrangements,
loss of the net interest benefit we generally receive under these arrangements, which is equal to
the difference between the fixed rate we receive and the variable rate we pay, may adversely impact
our results of operations and operating cash flows. In the event the values of the real estate
properties serving as collateral under these agreements decline, we may be required to provide
additional collateral pursuant to the swap agreements, which may adversely affect our cash flows.
FASB Accounting Standards Codification
In June 2009, the Financial Accounting Standards Board, or FASB, issued Statement of Financial
Accounting Standards No. 168, The FASB Accounting Standards Codification and the Hierarchy of
Generally Accepted Accounting Principles a replacement of FASB Statement No. 162, or SFAS 168,
which is effective for financial statements issued for interim and annual periods ending after
September 15, 2009. Upon the effective date of SFAS 168, the FASB Accounting Standards
Codification, or the FASB ASC, became the single source of authoritative GAAP recognized by the
FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities
and Exchange Commission, or SEC, under authority of federal securities laws are also sources of
authoritative GAAP for SEC registrants. The FASB ASC superseded all then-existing non-SEC
accounting and reporting standards, and all other non-grandfathered non-SEC accounting literature
not included in the FASB ASC is now non-authoritative. Subsequent to the effective date of SFAS
168, the FASB will issue Accounting Standards Updates that serve to update the FASB ASC.
43
Business Combinations
We adopted the provisions of FASB Statement of Financial Accounting Standards No. 141(R),
Business Combinations a replacement of FASB Statement No. 141, or SFAS 141(R), which are
codified in FASB ASC Topic 805, effective January 1, 2009. These provisions apply to all
transactions or events in which an entity obtains control of one or more businesses, including
those effected without the transfer of consideration, for example by contract or through a lapse of
minority veto rights. These provisions require the acquiring entity in a business combination to
recognize the full fair value of assets acquired and liabilities assumed in the transaction
(whether a full or partial acquisition); establish the acquisition-date fair value as the
measurement objective for all assets acquired and liabilities assumed; and require expensing of
most transaction and restructuring costs.
We believe most operating real estate assets meet the revised definition of a business.
Accordingly, beginning in 2009, we expense transaction costs associated with acquisitions of
operating real estate or interests therein when we consolidate the asset. The FASB did not provide
implementation guidance regarding the treatment of acquisition costs incurred prior to December 31,
2008, for acquisitions that did not close until 2009. The SEC indicated any of the following three
transition methods were acceptable, provided that the method chosen is disclosed and applied
consistently:
1) | expense acquisition costs in 2008 when it is probable that the acquisition will not close
in 2008; |
||
2) | expense acquisition costs January 1, 2009; or |
||
3) | give retroactive treatment to the acquisition costs January 1, 2009, by retroactively
adjusting prior periods to record acquisition costs in the prior periods in which they were
incurred. |
We elected to apply the third method and accordingly have retroactively adjusted our results
of operations for the year ended December 31, 2008, by $3.5 million, which also resulted in a
corresponding reduction to our December 31, 2008 equity balance. This retroactive adjustment is
reflected in investment management expenses in our accompanying consolidated statements of income
and reduced basic and diluted earnings per share amounts by $0.04 for the year ended December 31,
2008.
Noncontrolling Interests
Effective January 1, 2009, we adopted the provisions of FASB Statement of Financial Accounting
Standards No. 160, Noncontrolling Interests in Consolidated Financial Statements an amendment of
ARB No. 51, or SFAS 160, which are codified in FASB ASC Topic 810. These provisions clarified that
a noncontrolling interest in a subsidiary is an ownership interest in a consolidated entity, which
should be reported as equity in the parents consolidated financial statements. These provisions
require disclosure, on the face of the consolidated income statements, of the amounts of
consolidated net income and other comprehensive income attributable to controlling and
noncontrolling interests, eliminating the past practice of reporting amounts of income attributable
to noncontrolling interests as an adjustment in arriving at consolidated net income. These
provisions also require us to attribute to noncontrolling interests their share of losses even if
such attribution results in a deficit noncontrolling interest balance within our equity accounts,
and in some instances, recognize a gain or loss in net income when a subsidiary is deconsolidated.
In connection with our retrospective application of these provisions, we reclassified into our
consolidated equity accounts the historical balances related to noncontrolling interests in
consolidated real estate partnerships and the portion of noncontrolling interests in the Aimco
Operating Partnership related to the Aimco Operating Partnerships common OP Units and High
Performance Units. At December 31, 2008, the carrying amount of noncontrolling interests in
consolidated real estate partnerships was $380.7 million and the carrying amount for noncontrolling
interests in Aimco Operating Partnership attributable to common OP Units and High Performance Units
was zero, due to cash distributions in excess of the positive balances related to those
noncontrolling interests.
Beginning in 2009, we no longer record a charge related to cash distributions to
noncontrolling interests in excess of the carrying amount of such noncontrolling interests, and we
attribute losses to noncontrolling interests even if such attribution results in a deficit
noncontrolling interest balance within our equity accounts. The following table illustrates the
pro forma amounts of loss from continuing operations, discontinued operations and net loss that
would have been attributed to Aimco common stockholders for the year ended December 31, 2009, had
we applied the accounting provisions related to noncontrolling interests prior to their amendment
by SFAS 160 (in thousands, except per share amounts):
44
Year Ended | ||||
December 31, 2009 | ||||
Loss from continuing operations attributable to Aimco common stockholders |
$ | (220,727 | ) | |
Income from discontinued operations attributable to Aimco common stockholders |
85,814 | |||
Net loss attributable to Aimco common stockholders |
$ | (134,913 | ) | |
Basic and diluted earnings (loss) per common share: |
||||
Loss from continuing operations attributable to Aimco common stockholders |
$ | (1.93 | ) | |
Income from discontinued operations attributable to Aimco common stockholders |
0.75 | |||
Net loss attributable to Aimco common stockholders |
$ | (1.18 | ) | |
The following table presents a reconciliation of preferred noncontrolling interests in the
Aimco Operating Partnership, which are generally redeemable at the holders option and may be
settled in cash or, at the Aimco Operating Partnerships discretion, shares of Common Stock and are
included in temporary equity in our consolidated balance sheet, for the years ending December 31,
2009, 2008 and 2007.
2009 | 2008 | 2007 | ||||||||||
Balance at January 1 |
$ | 88,148 | $ | 89,716 | $ | 90,120 | ||||||
Net income attributable to
preferred noncontrolling
interests in the Aimco
Operating Partnership |
6,288 | 7,646 | 7,128 | |||||||||
Distributions attributable
to preferred noncontrolling
interests in the Aimco
Operating Partnership |
(6,806 | ) | (7,486 | ) | (7,489 | ) | ||||||
Conversion of preferred
units into Common Stock |
| | (43 | ) | ||||||||
Purchases of preferred units |
(1,725 | ) | (976 | ) | | |||||||
Other |
751 | (752 | ) | | ||||||||
Balance at December 31 |
$ | 86,656 | $ | 88,148 | $ | 89,716 | ||||||
The effects on our equity of changes in our ownership interest in the Aimco Operating
Partnership are reflected in our consolidated statement of equity as redemptions of Aimco Operating
Partnership units for Common Stock and repurchases of common partnership units.
Changes in our ownership interest in consolidated real estate partnerships generally consist
of our purchase of an additional interest in or the sale of our entire interest in a consolidated
real estate partnership. Our purchase of additional interests in consolidated real estate
partnerships had no direct effect on equity attributable to Aimco during the years ended December
31, 2008 and 2007, and did not have a significant effect on equity attributable to Aimco during the
year ended December 31, 2009. The effect on our equity of sales of our entire interest in
consolidated real estate partnerships is reflected in our consolidated financial statements as
sales of real estate and accordingly the effect on our equity is reflected as gains on disposition
of real estate, less the amounts of such gains attributable to noncontrolling interests, within
consolidated net (loss) income attributable to Aimco common stockholders.
Earnings per Share
We calculate earnings per share based on the weighted average number of shares of Common
Stock, common stock equivalents, participating securities and other potentially dilutive securities
outstanding during the period (see Note 14).
Effective January 1, 2009, we adopted the provisions of FASB Statement of Position No. EITF
03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions are
Participating Securities, or FSP EITF 03-6-1, which are codified in FASB ASC Topic 260. FSP EITF
03-6-1 clarified that unvested share-based payment awards that participate in dividends similar to
shares of common stock or common partnership units should be treated as participating securities.
FSP EITF 03-6-1 affects our computation of basic and diluted earnings per share for unvested
restricted stock awards and shares purchased pursuant to officer stock loans, which serve as
collateral for such loans, both of which entitle the holders to dividends. Refer to Note 14, which
details our calculation of earnings per share and the effect of our retroactive application of FSP
EITF 03-6-1 on our earnings per share.
45
In December 2009, we adopted the provisions of FASB Accounting Standards Update 2010-01,
Accounting for Distributions to Shareholders with Components of Stock and Cash, or ASU 2010-01,
which are codified in FASB ASC Topic 505. ASU 2010-01 requires that for distributions with
components of cash and stock, the portion distributed in stock should be accounted for
prospectively as a stock issuance with no retroactive adjustment to basic and diluted earnings per
share. In accordance with ASU 2010-01, we retrospectively revised the accounting treatment of our
special dividends paid during 2008 and 2009, resulting in changes in the number of weighted average
shares outstanding and earnings per share amounts for the years ended December 31, 2008 and 2007,
as compared to the amounts previously reported.
The following table illustrates the effects of these changes in accounting treatment on our
basic and diluted weighted average shares outstanding and on net income (loss) attributable to
Aimco common stockholders per common share for the years ended December 31, 2008 and 2007:
2008 | 2007 | |||||||
Weighted average shares outstanding basic and diluted: |
||||||||
As previously reported |
121,213 | 140,137 | ||||||
Reduction in weighted average shares outstanding |
(32,523 | ) | (45,030 | ) | ||||
As currently reported |
88,690 | 95,107 | ||||||
Net income (loss) attributable to Aimco common stockholders
per common share basic and diluted: |
||||||||
As previously reported |
$ | 2.98 | $ | (0.26 | ) | |||
Effect of reduction in weighted average shares outstanding |
1.06 | (0.12 | ) | |||||
Effect of participating securities allocations |
(0.08 | ) | (0.05 | ) | ||||
As currently reported |
$ | 3.96 | $ | (0.43 | ) | |||
Use of Estimates
The preparation of our consolidated financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts included in the
financial statements and accompanying notes thereto. Actual results could differ from those
estimates.
Restatement to Reclassify Impairment Losses on Real Estate Development Assets
Our consolidated statement of income for the year ended December 31, 2008, has been restated
to reclassify the provision for impairment losses on real estate development assets into operating
income. The reclassification reduced operating income by $91.1 million for the year ended December
31, 2008, and had no effect on the reported amounts of loss before income taxes and discontinued
operations, loss from continuing operations, net income, net income available to Aimco common
stockholders or earnings per share. Additionally, the reclassification had no effect on the
consolidated balance sheet at December 31, 2008, or the consolidated statements of equity and cash
flows for the year ended December 31, 2008.
Reclassifications
Certain items included in the 2008 and 2007 financial statements have been reclassified to
conform to the current presentation.
NOTE 3 Real Estate and Partnership Acquisitions and Other Significant Transactions
Real Estate Acquisitions
During the year ended December 31, 2009, we did not acquire any real estate properties.
During the year ended December 31, 2008, we acquired three conventional properties with a
total of 470 units, located in San Jose, California, Brighton, Massachusetts and Seattle,
Washington. The aggregate purchase price of $111.5 million, excluding transaction costs, was
funded using $39.0 million in proceeds from property loans, $41.9 million in tax-free exchange
proceeds (provided by 2008 real estate dispositions) and the remainder in cash.
46
During the year ended December 31, 2007, we completed the acquisition of 16 conventional
properties with approximately 1,300 units for an aggregate purchase price of approximately $217.0
million, excluding transaction costs. Of the 16 properties acquired, ten are located in New York
City, New York, two in Daytona Beach, Florida, one in Park Forest, Illinois, one in Poughkeepsie,
New York, one in Redwood City, California, and one in North San Diego, California. The purchases
were funded with cash, tax-free exchange proceeds, new debt and the assumption of existing debt.
Acquisitions of Partnership Interests
During the year ended December 31, 2009, we did not acquire a significant amount of limited
partnership interests. During the years ended December 31, 2008 and 2007, we acquired limited
partnership interests in 22 and 50 partnerships, respectively, in which our affiliates served as
general partner. In connection with such acquisitions, we paid cash of approximately $2.0 million
and $47.4 million, including transaction costs. The cost of the acquisitions was approximately
$2.4 million and $43.6 million in excess of the carrying amount of noncontrolling interest in such
limited partnerships, which excess we generally assigned to real estate.
Disposition of Unconsolidated Real Estate and Other
During the year ended December 31, 2009, we recognized $22.5 million in gains on disposition
of unconsolidated real estate and other. Gains recognized in 2009 primarily consist of $8.6
million related to our receipt in 2009 of additional proceeds related to our disposition during
2008 of one of the partnership interests (discussed below), $4.0 million from the disposition of
our interest in a group purchasing organization (discussed further below), $6.1 million from our
disposition of interests in unconsolidated real estate partnerships and our share of gains
recognized by our unconsolidated partnerships on the sale of real estate and $3.8 million related
to various other transactions.
During the year ended December 31, 2008, we recognized $99.9 million in gains on disposition
of unconsolidated real estate and other, which primarily consisted of a $98.4 million gain
recognized on the disposal of our interests in unconsolidated real estate partnerships that owned
two properties with 671 units.
Casualty Loss Related to Tropical Storm Fay and Hurricane Ike
During 2008, Tropical Storm Fay and Hurricane Ike caused severe damage to certain of our
properties located primarily in Florida and Texas, respectively. We incurred total losses of
approximately $33.9 million, including property damage replacement costs and clean-up costs. After
consideration of estimated third party insurance proceeds and the noncontrolling interest partners
share of losses for consolidated real estate partnerships, the net effect of these casualties on
net income available to Aimco common stockholders was a loss of approximately $5.0 million.
Sale of Interest in Group Purchasing Organization
During 2009, we sold our interest in an unconsolidated group purchasing organization to an
unrelated entity for $5.9 million, resulting in the recognition of a gain on sale of $4.0 million,
which is included in gain on disposition of unconsolidated real estate and other in our
consolidated statement of income for the year ended December 31, 2009. This gain was partially
offset by a $1.0 million provision for income tax. We also have a note receivable from another
principal in the group purchasing organization, which is collateralized by its equity interest in
the entity. In connection with the sale of our interest, we reevaluated collectibility of the note
receivable and reversed $1.4 million of previously recognized impairment losses, which is reflected
in provision for losses on notes receivable, net in our consolidated statement of income for the
year ended December 31, 2009. As of December 31, 2009, the carrying amount of the note receivable,
which is due for repayment in 2010, totaled $1.6 million.
Restructuring Costs
In connection with 2008 property sales and an expected reduction in redevelopment and
transactional activities, during the three months ended December 31, 2008, we initiated an
organizational restructuring program that included reductions in workforce and related costs,
reductions in leased corporate facilities and abandonment of certain redevelopment projects and
business pursuits. This restructuring effort resulted in a restructuring charge of $22.8 million,
which consisted of: severance costs of $12.9 million; unrecoverable lease obligations of $6.4
million related to space that we will no longer use; and the write-off of deferred transaction
costs totaling $3.5 million associated with certain acquisitions and redevelopment opportunities
that we will no longer pursue. We completed the workforce reductions by March 31, 2009.
47
During 2009, in connection with continued repositioning of our portfolio, we completed
additional organizational restructuring activities that included reductions in workforce and
related costs and the abandonment of additional leased corporate facilities and redevelopment
projects.
Our 2009 restructuring activities resulted in a restructuring charge of $11.2 million, which
consisted of severance costs and personnel related costs of $7.0 million; unrecoverable lease
obligations of $2.6 million related to space that we will no longer use; the write-off of deferred
costs totaling $0.9 million associated with certain redevelopment opportunities that we will no
longer pursue; and $0.7 million in other costs.
As of December 31, 2009, the remaining accruals associated with our restructuring activity are
$6.9 million for estimated unrecoverable lease obligations, which will be paid over the remaining
terms of the affected leases, and $4.7 million for severance and personnel related costs, which are
anticipated to be paid during the first quarter 2010.
Transactions Involving VMS National Properties Joint Venture
In January 2007, VMS National Properties Joint Venture, or VMS, a consolidated real estate
partnership in which we held a 22% equity interest, refinanced property loans secured by its 15
apartment properties. The existing loans had an aggregate carrying amount of $110.0 million and an
aggregate face amount of $152.2 million. The $42.2 million difference between the face amount and
carrying amount resulted from a 1997 bankruptcy settlement in which the lender agreed to reduce the
principal amount of the loans subject to VMSs compliance with the terms of the restructured loans.
Because the reduction in the loan amount was contingent on future compliance, recognition of the
inherent debt extinguishment gain was deferred. Upon refinancing of the loans in January 2007, the
existing lender accepted the reduced principal amount in full satisfaction of the loans, and VMS
recognized the $42.2 million debt extinguishment gain in earnings.
During the year ended December 31, 2007, VMS sold eight properties to third parties for an
aggregate gain of $22.7 million. Additionally, VMS contributed its seven remaining properties to
wholly-owned subsidiaries of Aimco in exchange for consideration totaling $230.1 million,
consisting primarily of cash of $21.3 million, common OP Units with a fair value of $9.8 million,
the assumption of $168.0 million in property debt, and the assumption of $30.9 million in mortgage
participation liabilities. This total consideration included $50.7 million related to our 22%
equity interest in VMS. Exclusive of our share, the consideration paid for the seven properties
exceeded the carrying amount of the noncontrolling interest in such properties by $44.9 million.
This excess consideration is reflected in our consolidated balance sheet as an increase in the
carrying amount of the seven properties.
Approximately $32.7 million of the $42.2 million debt extinguishment gain related to the
property loans that were secured by the eight properties sold to third parties and three properties
we acquired from VMS but subsequently sold and is reported in discontinued operations for the year
ended December 31, 2007. The remaining $9.5 million portion of the debt extinguishment gain
related to the property loans that were secured by the four VMS properties we purchased and
continue to own and is reported in our continuing operations as gain on dispositions of
unconsolidated real estate and other. Although 78% of the equity interests in VMS were held by
unrelated noncontrolling partners, no noncontrolling interest share of the gains on debt
extinguishment and sale of the properties was recognized in our earnings. As required by then
applicable GAAP, we had in prior years recognized the noncontrolling partners share of VMS losses
in excess of the noncontrolling partners capital contributions. The amounts of those previously
recognized losses exceeded the noncontrolling partners share of the gains on debt extinguishment
and sale of the properties; accordingly, the noncontrolling interests in such gains recognized in
our earnings was limited to the noncontrolling interests in the Aimco Operating Partnership. For
the year ended December 31, 2007, the aggregate effect of the gains on extinguishment of VMS debt
and sale of VMS properties was to decrease loss from continuing operations attributable to Aimco
common stockholders by $8.7 million ($0.09 per diluted share) and decrease net loss attributable to
Aimco common stockholders by $59.1 million ($0.62 per diluted share).
During the three months ended December 31, 2007, VMS distributed its remaining cash,
consisting primarily of undistributed proceeds from the sale of its 15 properties (including
properties sold to us). Of the $42.4 million of cash distributed to the unrelated limited
partners, $21.3 million represents the cash consideration we contributed in exchange for the
purchase of seven properties and is presented in purchases of partnership interests and other
assets in the consolidated statement of cash flows for the year ended December 31, 2007. The
remainder of the cash distributed to the unrelated limited partners is presented in payment of
distributions to noncontrolling interest in the consolidated statement of cash flows.
48
Palazzo Joint Venture
In December 2007, we entered into a joint venture agreement with a third party investor which
provides for the co-ownership of three multi-family properties with 1,382 units located in West Los
Angeles. Under the agreement, we contributed three wholly-owned properties, The Palazzo at Park La
Brea, The Palazzo East at Park La Brea and The Villas at Park La Brea to the partnership, which we
refer to as Palazzo, at a value of $726.0 million, or approximately $525,000 per unit. Palazzo had
existing property debt of approximately $296.0 million and an implied equity value of approximately
$430.0 million. We received $202.0 million from the investor in exchange for an approximate 47%
interest in Palazzo, of which approximately $7.9 million was used to fund escrows for capital
improvements and various operating requirements. We own the remaining interests in Palazzo,
including a managing interest, and will operate the properties in exchange for a property
management fee and certain other fees over the term of the partnership.
We determined Palazzo is a VIE and that we are the primary beneficiary who should consolidate
this partnership. We deferred recognition of a gain on this transaction and recognized the
consideration received as an increase in noncontrolling interests in consolidated real estate
partnerships.
NOTE 4 Investments in Unconsolidated Real Estate Partnerships
We owned general and limited partner interests in unconsolidated real estate partnerships
owning approximately 77, 85 and 94 properties at December 31, 2009, 2008 and 2007, respectively.
We acquired these interests through various transactions, including large portfolio acquisitions
and offers to individual limited partners. Our total ownership interests in these unconsolidated
real estate partnerships typically ranges from less than 1% to 50% and in some instances may exceed
50%.
The following table provides selected combined financial information for the unconsolidated
real estate partnerships in which we had investments accounted for under the equity method as of
and for the years ended December 31, 2009, 2008 and 2007 (in thousands):
2009 | 2008 | 2007 | ||||||||||
Real estate, net of accumulated depreciation |
$ | 95,226 | $ | 122,788 | $ | 133,544 | ||||||
Total assets |
122,543 | 155,444 | 165,567 | |||||||||
Secured and other notes payable |
101,678 | 122,859 | 124,406 | |||||||||
Total liabilities |
145,637 | 175,681 | 180,222 | |||||||||
Partners deficit |
(23,094 | ) | (20,237 | ) | (14,655 | ) | ||||||
Rental and other property revenues |
55,366 | 69,392 | 73,672 | |||||||||
Property operating expenses |
(34,497 | ) | (42,863 | ) | (45,998 | ) | ||||||
Depreciation expense |
(10,302 | ) | (12,640 | ) | (13,965 | ) | ||||||
Interest expense |
(11,103 | ) | (17,182 | ) | (17,194 | ) | ||||||
Gain on sale |
8,482 | 5,391 | 59 | |||||||||
Net income (loss) |
6,622 | 1,398 | (4,845 | ) |
As a result of our acquisition of interests in unconsolidated real estate partnerships at a
cost in excess of the historical carrying amount of the partnerships net assets, our aggregate
investment in these partnerships at December 31, 2009 and 2008 of $105.3 million and $119.0
million, respectively, exceeds our share of the underlying historical partners deficit of the
partnerships by approximately $109.5 million and $122.9 million, respectively.
49
NOTE 5 Notes Receivable
The following table summarizes our notes receivable at December 31, 2009 and 2008 (in
thousands):
2009 | 2008 | |||||||||||||||||||||||
Unconsolidated | Unconsolidated | |||||||||||||||||||||||
Real Estate | Non- | Real Estate | Non- | |||||||||||||||||||||
Partnerships | Affiliates | Total | Partnerships | Affiliates | Total | |||||||||||||||||||
Par value notes |
$ | 11,353 | $ | 20,862 | $ | 32,215 | $ | 18,855 | $ | 19,253 | $ | 38,108 | ||||||||||||
Discounted notes |
5,095 | 141,468 | 146,563 | 8,575 | 138,387 | 146,962 | ||||||||||||||||||
Allowance for loan
losses |
(2,153 | ) | (37,061 | ) | (39,214 | ) | (4,863 | ) | (17,743 | ) | (22,606 | ) | ||||||||||||
Total notes receivable |
$ | 14,295 | $ | 125,269 | $ | 139,564 | $ | 22,567 | $ | 139,897 | $ | 162,464 | ||||||||||||
Face value of
discounted notes |
$ | 37,709 | $ | 155,848 | $ | 193,557 | $ | 39,333 | $ | 148,790 | $ | 188,123 |
Included in notes receivable from unconsolidated real estate partnerships at December 31,
2009 and 2008, are $2.4 million and $4.2 million, respectively, in notes that were secured by
interests in real estate or interests in real estate partnerships. We earn interest on these
secured notes receivable at various annual interest rates averaging 12.0%.
Included in the notes receivable from non-affiliates at December 31, 2009 and 2008, are $102.2
million and $95.8 million, respectively, in notes that were secured by interests in real estate or
interests in real estate partnerships. We earn interest on these secured notes receivable at
various annual interest rates ranging between 4.0% and 12.0% and averaging 4.7%.
Notes receivable from non-affiliates at December 31, 2009 and 2008, include notes receivable
totaling $87.4 million and $85.6 million, respectively, from 31 entities (the borrowers) that are
wholly owned by a single individual. We originated these notes in November 2006 pursuant to a loan
agreement that provides for total funding of approximately $110.0 million, including $16.4 million
for property improvements and an interest reserve, of which $4.6 million had not been funded as of
December 31, 2009. The notes mature in November 2016, bear interest at LIBOR plus 2.0%, are
partially guaranteed by the owner of the borrowers, and are collateralized by second mortgages on
87 buildings containing 1,597 residential units and 42 commercial spaces in West Harlem, New York
City. In conjunction with the loan agreement, we entered into a purchase option and put agreement
with the borrowers under which we may purchase some or all of the buildings and, subject to
achieving specified increases in rental income, the borrowers may require us to purchase the
buildings (see Note 8). We determined that the stated interest rate on the notes on the date the
loan was originated was a below-market interest rate and recorded a $19.4 million discount to
reflect the estimated fair value of the notes based on an estimated market interest rate of LIBOR
plus 4.0%. The discount was determined to be attributable to our real estate purchase option,
which we recorded separately in other assets. Accretion of this discount, which is included in
interest income in our consolidated statements of income, totaled $0.9 million in 2009, $0.7
million in 2008 and $1.9 million in 2007, inclusive of a $1.5 million adjustment of accretion
recognized upon the repayment of a portion of the outstanding principal balance in 2007. The value
of the purchase option asset will be included in the cost of properties acquired pursuant to the
option or otherwise be charged to expense. We determined that the borrowers are VIEs and, based on
qualitative and quantitative analysis, determined that the individual who owns the borrowers and
partially guarantees the notes is the primary beneficiary.
As part of the March 2002 acquisition of Casden Properties, Inc., we invested $50.0 million
for a 20% passive interest in Casden Properties LLC, an entity organized to acquire, re-entitle and
develop land parcels in Southern California. Based upon the profit allocation agreement, we
account for this investment as a note receivable and through 2008 were amortizing the discounted
value of the investment to the $50.0 million previously estimated to be collectible, through
January 2, 2009, the initial dissolution date of the entity. In 2009, the managing member extended
the dissolution date. In connection with the preparation of our 2008 annual financial statements
and as a result of a decline in land values in Southern California, we determined our recorded
investment amount was not fully recoverable, and accordingly recognized an impairment loss of $16.3
million ($10.0 million net of tax) during the three months ended December 31, 2008. In connection
with the preparation of our 2009 annual financial statements and as a result of continued declines
in land values in Southern California, we determined our then recorded investment amount was not
fully recoverable, and accordingly recognized an impairment loss of $20.7 million ($12.4 million
net of tax) during the three months ended December 31, 2009.
50
Interest income from total non-impaired par value and certain discounted notes for the years
ended December 31, 2009, 2008 and 2007 totaled $5.7 million, $7.8 million and $11.7 million,
respectively. For the years ended December 31, 2009, 2008 and 2007, we recognized accretion income
on certain discounted notes of $0.1 million, $1.4 million and $8.1 million, respectively.
The activity in the allowance for loan losses in total for both par value notes and discounted
notes for the years ended December 31, 2009 and 2008, is as follows (in thousands):
2009 | 2008 | |||||||
Balance at beginning of year |
$ | (22,606 | ) | $ | (6,435 | ) | ||
Provisions for losses on notes receivable |
(2,231 | ) | (1,673 | ) | ||||
Recoveries of losses on notes receivable |
1,422 | 417 | ||||||
Provisions for impairment loss on investment in Casden Properties LLC |
(20,740 | ) | (16,321 | ) | ||||
Net reductions due to consolidation of real estate partnerships and
property dispositions |
4,941 | 1,406 | ||||||
Balance at end of year |
$ | (39,214 | ) | $ | (22,606 | ) | ||
During the years ended December 31, 2009 and 2008, we determined that an allowance for loan
losses of $1.2 million and $3.6 million, respectively, was required on certain of our par value
notes that had carrying amounts of $3.8 million and $11.4 million, respectively. The average
recorded investment in the impaired par value notes for the years ended December 31, 2009 and 2008,
was $7.6 million and $9.0 million, respectively. The remaining $28.4 million in par value notes
receivable at December 31, 2009, is estimated to be collectible and, therefore, interest income on
these par value notes is recognized as it is earned.
As of December 31, 2009 and 2008, we determined that an allowance for loan losses of $1.0
million and $2.7 million, respectively, was required on certain of our discounted notes (excluding
the note related to Casden Properties LLC discussed above) that had carrying values of $1.6 million
and $5.4 million, respectively. The average recorded investment in the impaired discounted notes
for the years ended December 31, 2009 and 2008, was $3.5 million and $4.9 million, respectively.
NOTE 6 Property Tax-Exempt Bond Financings, Property Loans Payable and Other Borrowings
The following table summarizes our property tax-exempt bond financings related to properties
classified as held for use at December 31, 2009 and 2008, the majority of which is non-recourse to
us (in thousands):
Weighted Average | Principal | |||||||||||
Interest Rate | Outstanding | |||||||||||
2009 | 2009 | 2008 | ||||||||||
Fixed rate property tax-exempt bonds payable |
5.10 | % | $ | 140,995 | $ | 131,530 | ||||||
Variable rate property tax-exempt bonds payable |
0.90 | % | 433,931 | 497,969 | ||||||||
Total |
$ | 574,926 | $ | 629,499 | ||||||||
Fixed rate property tax-exempt bonds payable mature at various dates through December 2049.
Variable rate property tax-exempt bonds payable mature at various dates through June 2038.
Principal and interest on these bonds are generally payable in semi-annual installments with
balloon payments due at maturity. Certain of our property tax-exempt bonds at December 31, 2009,
are remarketed periodically by a remarketing agent to maintain a variable yield. If the
remarketing agent is unable to remarket the bonds, then the remarketing agent can put the bonds to
us. We believe that the likelihood of this occurring is remote. At December 31, 2009, our
property tax-exempt bond financings related to properties classified as held for use were secured
by 39 properties with a combined net book value of $837.7 million. As discussed in Note 2, certain
fixed rate property tax-exempt bonds payable have been converted to variable rates using total rate
of return swaps and are presented above as variable rate debt at their carrying amounts, or fair
value.
51
The following table summarizes our property loans payable related to properties classified as
held for use at December 31, 2009 and 2008, the majority of which are non-recourse to us (in
thousands):
Weighted Average | Principal | |||||||||||
Interest Rate | Outstanding | |||||||||||
2009 | 2009 | 2008 | ||||||||||
Fixed rate property notes payable |
6.00 | % | $ | 4,712,744 | $ | 4,524,322 | ||||||
Variable rate property notes payable |
2.46 | % | 75,877 | 223,561 | ||||||||
Secured notes credit facility |
1.02 | % | 34,544 | 46,408 | ||||||||
Total |
$ | 4,823,165 | $ | 4,794,291 | ||||||||
Fixed rate property notes payable mature at various dates through August 2053. Variable rate
property notes payable mature at various dates through November 2030. Principal and interest are
generally payable monthly or in monthly interest-only payments with balloon payments due at
maturity. At December 31, 2009, our property notes payable related to properties classified as
held for use were secured by 347 properties with a combined net book value of $5,863.6 million. As
discussed in Note 2, certain fixed rate secured notes payable have been converted to variable rates
using total rate of return swaps and are presented above as variable rate debt at their carrying
amounts, or fair value.
At December 31, 2009, we had a secured revolving credit facility with a major life company
that provided for borrowings of up to $200.0 million. In January 2010, the credit facility was
modified to reduce allowed borrowings to the then outstanding amount of $46.3 million. The primary
function of the facility is to secure short-term fully pre-payable non-recourse loans for a period
of less than three years. The interest rate on the notes provided through the facility is 30-day
LIBOR plus 0.78%. Each loan under the facility is treated as a separate borrowing and is secured
by a specific property. None of the facility loans are cross-collateralized or cross-defaulted.
This facility matures in October 2010, and has two one-year extension options for a $500,000 fee
per extension. At December 31, 2009, outstanding borrowings of $34.5 million related to properties
classified as held for use are included in 2012 maturities below based on the extension options.
Our consolidated debt instruments generally contain covenants common to the type of facility
or borrowing, including financial covenants establishing minimum debt service coverage ratios and
maximum leverage ratios. At December 31, 2009, we were in compliance with all financial covenants
pertaining to our consolidated debt instruments.
Other borrowings totaled $53.1 million and $96.0 million at December 31, 2009 and 2008,
respectively. At December 31, 2009, other borrowings includes $44.6 million in fixed rate
obligations with interest rates ranging from zero to 10.0% and $8.5 million in variable rate
obligations bearing interest at the prime rate plus 1.75%. The maturity dates for other borrowings
range from 2010 to 2039, although certain amounts are due upon occurrence of specified events, such
as property sales.
As of December 31, 2009, the scheduled principal amortization and maturity payments for our
property tax-exempt bonds, property notes payable and other borrowings related to properties in
continuing operations are as follows (in thousands):
Amortization | Maturities | Total | ||||||||||
2010 |
$ | 97,609 | $ | 3,349 | $ | 100,958 | ||||||
2011 |
102,274 | 237,796 | 340,070 | |||||||||
2012 |
105,391 | 205,705 | 311,096 | |||||||||
2013 |
104,892 | 369,210 | 474,102 | |||||||||
2014 |
102,101 | 267,544 | 369,645 | |||||||||
Thereafter |
3,855,277 | |||||||||||
$ | 5,451,148 | |||||||||||
NOTE 7 Term Loans and Credit Facility
We have an Amended and Restated Senior Secured Credit Agreement, as amended, with a syndicate
of financial institutions, which we refer to as the Credit Agreement. In addition to Aimco, the
Aimco Operating Partnership and an Aimco subsidiary are also borrowers under the Credit Agreement.
52
As of December 31, 2009, the Credit Agreement consisted of aggregate commitments of $270.0
million, comprised of the $90.0 million outstanding balance on the term loan and $180.0 million of
revolving loan commitments. The term
loan bears interest at LIBOR plus 1.5%, or at our option, a base rate equal to the prime rate,
and matures March 2011. Borrowings under the revolving credit facility bear interest based on a
pricing grid determined by leverage (either at LIBOR plus 4.25% with a LIBOR floor of 2.00% or, at
our option, a base rate equal to the Prime rate plus a spread of 3.00%). The revolving credit
facility matures May 1, 2011, and may be extended for an additional year, subject to certain
conditions, including payment of a 45.0 basis point fee on the total revolving commitments and
repayment of the remaining term loan balance by February 1, 2011. Pursuant to the Credit
Agreement, while any balance under the term loan is outstanding, repurchases of our Common Stock
are permitted with 50% of net asset sale proceeds if the other 50% of such net asset sale proceeds
are applied to repay the term loan. The Credit Agreement permits us to increase revolving
commitments by up to $320.0 million, subject to our obtaining such commitments from eligible
lenders.
The Credit Agreement includes customary financial covenants, including the maintenance of
specified ratios with respect to total indebtedness to gross asset value, total secured
indebtedness to gross asset value, aggregate recourse indebtedness to gross asset value, variable
rate debt to total indebtedness, debt service coverage and fixed charge coverage; the maintenance
of a minimum adjusted tangible net worth; and limitations regarding the amount of
cross-collateralized debt. The Credit Agreement includes other customary covenants, including a
restriction on distributions and other restricted payments, but permits distributions during any
four consecutive fiscal quarters in an aggregate amount of up to 95% of our funds from operations
for such period, subject to certain non-cash adjustments, or such amount as may be necessary to
maintain our REIT status. We were in compliance with all such covenants as of December 31, 2009.
The lenders under the Credit Agreement may accelerate any outstanding loans if, among other
things: we fail to make payments when due (subject to applicable grace periods); material defaults
occur under other debt agreements; certain bankruptcy or insolvency events occur; material
judgments are entered against us; we fail to comply with certain covenants, such as the requirement
to deliver financial information or the requirement to provide notices regarding material events
(subject to applicable grace periods in some cases); indebtedness is incurred in violation of the
covenants; or prohibited liens arise.
At December 31, 2009, the term loan had an outstanding principal balance of $90.0 million and
an interest rate of 1.73%. We repaid $45.0 million of the term loan through February 26, 2010,
leaving a remaining outstanding balance of $45.0 million. At December 31, 2009, we had no
outstanding borrowings under the revolving credit facility. The amount available under the
revolving credit facility at December 31, 2009, was $136.2 million (after giving effect to $43.8
million outstanding for undrawn letters of credit issued under the revolving credit facility). The
proceeds of revolving loans are generally permitted to be used to fund working capital and for
other corporate purposes.
On February 3, 2010, we entered into an Eighth Amendment to our Credit Agreement, which
provides for a reduction in the minimum threshold for our debt service coverage and fixed charge
coverage ratios and an increase in the maximum threshold for our secured indebtedness ratio.
NOTE 8 Commitments and Contingencies
Commitments
In connection with our redevelopment and capital improvement activities, we have commitments
of approximately $4.8 million related to construction projects that are expected to be completed
during 2010. Additionally, we enter into certain commitments for future purchases of goods and
services in connection with the operations of our properties. Those commitments generally have
terms of one year or less and reflect expenditure levels comparable to our historical expenditures.
As discussed in Note 5, we have committed to fund an additional $4.6 million in loans on
certain properties in West Harlem in New York City. In certain circumstances, the obligor under
these notes has the ability to put properties to us, which would result in a cash payment between
$30.0 and $97.5 million and the assumption of approximately $119.0 million in property debt. The
ability to exercise the put and the amount of cash payment required upon exercise is dependent upon
the achievement of specified thresholds by the current owner of the properties.
As discussed in Note 11, we have a potential obligation to repurchase $30.0 million in
liquidation preference of our Series A Community Reinvestment Act Preferred Stock for $21.0
million.
53
Tax Credit Arrangements
We are required to manage certain consolidated real estate partnerships in compliance with
various laws, regulations and contractual provisions that apply to our historic and low-income
housing tax credit syndication arrangements. In some instances, noncompliance with applicable
requirements could result in projected tax benefits not being realized and require a refund or
reduction of investor capital contributions, which are reported as deferred income in our
consolidated balance sheet, until such time as our obligation to deliver tax benefits is relieved.
The remaining compliance periods for our tax credit syndication arrangements range from less than
one year to 15 years. We do not anticipate that any material refunds or reductions of investor
capital contributions will be required in connection with these arrangements.
Legal Matters
In addition to the matters described below, we are a party to various legal actions and
administrative proceedings arising in the ordinary course of business, some of which are covered by
our general liability insurance program, and none of which we expect to have a material adverse
effect on our consolidated financial condition, results of operations or cash flows.
Limited Partnerships
In connection with our acquisitions of interests in real estate partnerships and our role as
general partner in certain real estate partnerships, we are sometimes subject to legal actions,
including allegations that such activities may involve breaches of fiduciary duties to the partners
of such real estate partnerships or violations of the relevant partnership agreements. We may incur
costs in connection with the defense or settlement of such litigation. We believe that we comply
with our fiduciary obligations and relevant partnership agreements. Although the outcome of any
litigation is uncertain, we do not expect any such legal actions to have a material adverse effect
on our consolidated financial condition, results of operations or cash flows.
Environmental
Various Federal, state and local laws subject property owners or operators to liability for
management, and the costs of removal or remediation, of certain hazardous substances present on a
property, including lead-based paint. Such laws often impose liability without regard to whether
the owner or operator knew of, or was responsible for, the release or presence of the hazardous
substances. The presence of, or the failure to manage or remedy properly, hazardous substances may
adversely affect occupancy at affected apartment communities and the ability to sell or finance
affected properties. In addition to the costs associated with investigation and remediation actions
brought by government agencies, and potential fines or penalties imposed by such agencies in
connection therewith, the presence of hazardous substances on a property could result in claims by
private plaintiffs for personal injury, disease, disability or other infirmities. Various laws also
impose liability for the cost of removal, remediation or disposal of hazardous substances through a
licensed disposal or treatment facility. Anyone who arranges for the disposal or treatment of
hazardous substances is potentially liable under such laws. These laws often impose liability
whether or not the person arranging for the disposal ever owned or operated the disposal facility.
In connection with the ownership, operation and management of properties, we could potentially be
liable for environmental liabilities or costs associated with our properties or properties we
acquire or manage in the future.
We have determined that our legal obligations to remove or remediate hazardous substances may
be conditional asset retirement obligations, as defined in GAAP. Except in limited circumstances
where the asset retirement activities are expected to be performed in connection with a planned
construction project or property casualty, we believe that the fair value of our asset retirement
obligations cannot be reasonably estimated due to significant uncertainties in the timing and
manner of settlement of those obligations. Asset retirement obligations that are reasonably
estimable as of December 31, 2009, are immaterial to our consolidated financial condition, results
of operations and cash flows.
54
Mold
We have been named as a defendant in lawsuits that have alleged personal injury and property
damage as a result of the presence of mold. In addition, we are aware of lawsuits against owners
and managers of multifamily properties asserting claims of personal injury and property damage
caused by the presence of mold, some of which have resulted in substantial monetary judgments or
settlements. We have only limited insurance coverage for property damage loss claims arising from
the presence of mold and for personal injury claims related to mold exposure. We have implemented
policies, procedures, third-party audits and training, and include a detailed moisture intrusion
and mold
assessment during acquisition due diligence. We believe these measures will prevent or
eliminate mold exposure from our properties and will minimize the effects that mold may have on our
residents. To date, we have not incurred any material costs or liabilities relating to claims of
mold exposure or to abate mold conditions. Because the law regarding mold is unsettled and subject
to change, we can make no assurance that liabilities resulting from the presence of or exposure to
mold will not have a material adverse effect on our consolidated financial condition, results of
operations or cash flows.
Operating Leases
We are obligated under office space and equipment non-cancelable operating leases. In
addition, we sublease certain of our office space to tenants under non-cancelable subleases.
Approximate minimum annual rentals under operating leases and approximate minimum payments to be
received under annual subleases are as follows (in thousands):
Operating | ||||||||
Lease | Sublease | |||||||
Obligations | Receivables | |||||||
2010 |
$ | 7,345 | $ | 818 | ||||
2011 |
5,800 | 185 | ||||||
2012 |
5,056 | 64 | ||||||
2013 |
2,594 | 12 | ||||||
2014 |
2,265 | | ||||||
Thereafter |
1,828 | | ||||||
Total |
$ | 24,888 | $ | 1,079 | ||||
Substantially all of the office space subject to the operating leases described above are for
the use of our corporate offices and area operations. Rent expense recognized totaled $7.7
million, $10.2 million and $9.8 million for the years ended December 31, 2009, 2008 and 2007,
respectively. Sublease receipts that offset rent expense totaled approximately $0.7 million, $0.7
million and $1.3 million for the years ended December 31, 2009, 2008 and 2007, respectively.
As discussed in Note 3, during the years ended December 31, 2009 and 2008, we commenced
restructuring activities pursuant to which we vacated certain leased office space for which we
remain obligated. In connection with the restructurings, we accrued amounts representing the
estimated fair value of certain lease obligations related to space we are no longer using, reduced
by estimated sublease amounts. At December 31, 2009, approximately $6.9 million related to the
above operating lease obligations was included in accrued liabilities related to these estimates.
55
NOTE 9 Income Taxes
Deferred income taxes reflect the net effects of temporary differences between the carrying
amounts of assets and liabilities of the taxable REIT subsidiaries for financial reporting purposes
and the amounts used for income tax purposes. Significant components of our deferred tax
liabilities and assets are as follows (in thousands):
2009 | 2008 | |||||||
Deferred tax liabilities: |
||||||||
Partnership differences |
$ | 32,565 | $ | 47,635 | ||||
Depreciation |
2,474 | 2,477 | ||||||
Deferred revenue |
14,862 | 7,757 | ||||||
Other |
| 11 | ||||||
Total deferred tax liabilities |
$ | 49,901 | $ | 57,880 | ||||
Deferred tax assets: |
||||||||
Net operating, capital and other loss carryforwards |
$ | 37,164 | $ | 7,183 | ||||
Provision for impairments on real estate assets |
33,321 | 33,321 | ||||||
Receivables |
3,094 | 5,530 | ||||||
Accrued liabilities |
9,272 | 23,504 | ||||||
Accrued interest expense |
| 2,220 | ||||||
Intangibles management contracts |
1,911 | 3,789 | ||||||
Tax credit carryforwards |
6,949 | 8,521 | ||||||
Equity compensation |
1,463 | 1,983 | ||||||
Other |
929 | 155 | ||||||
Total deferred tax assets |
94,103 | 86,206 | ||||||
Valuation allowance |
(2,187 | ) | | |||||
Net deferred income tax assets |
$ | 42,015 | $ | 28,326 | ||||
As of December 31, 2009, we determined a valuation allowance for our deferred tax assets was
necessary for certain state net operating losses based on a determination that it was more likely
than not that such assets will not be realized prior to their expiration.
A reconciliation of the beginning and ending balance of our unrecognized tax benefits is
presented below:
2009 | 2008 | 2007 | ||||||||||
Balance at January 1 |
$ | 3,080 | $ | 2,965 | $ | 3,118 | ||||||
Reductions as a result of the lapse of applicable statutes |
| | (189 | ) | ||||||||
Additions based on tax positions related to the prior year |
| 115 | 36 | |||||||||
Reductions based on tax positions related to the prior year |
(1 | ) | | | ||||||||
Balance at December 31 |
$ | 3,079 | $ | 3,080 | $ | 2,965 | ||||||
We do not anticipate any material changes in existing unrecognized tax benefits during the
next 12 months. Because the statute of limitations has not yet elapsed, our Federal income tax
returns for the year ended December 31, 2006, and subsequent years and certain of our State income
tax returns for the year ended December 31, 2004, and subsequent years are currently subject to
examination by the Internal Revenue Service or other tax authorities. As discussed in Note 2, the
IRS has issued us summary reports including its proposed adjustments to the Aimco Operating
Partnerships 2007 and 2006 Federal tax returns. We do not expect the proposed adjustments to have
any material effect on our unrecognized tax benefits, financial condition or results of operations.
Our policy is to include interest and penalties related to income taxes in income taxes in our
consolidated statements of income.
In accordance with the accounting requirements for stock-based compensation, our deferred tax
assets at December 31, 2008, are net of $3.6 million of excess tax benefits from employee stock
option exercises and vested restricted stock awards. As of December 31, 2009, we had no such
excess tax benefits from employee stock option exercises and vested restricted stock awards.
The cost of land and depreciable property, net of accumulated depreciation, for federal income
tax purposes was approximately $4.6 billion.
56
Significant components of the provision (benefit) for income taxes are as follows and are
classified within income tax benefit in continuing operations and income from discontinued
operations, net in our statements of income for the years ended December 31, 2009, 2008 and 2007
(in thousands):
2009 | 2008 | 2007 | ||||||||||
Current: |
||||||||||||
Federal |
$ | (1,910 | ) | $ | 8,678 | $ | 20 | |||||
State |
3,992 | 2,415 | 1,938 | |||||||||
Total current |
2,082 | 11,093 | 1,958 | |||||||||
Deferred: |
||||||||||||
Federal |
(17,320 | ) | (22,115 | ) | (17,816 | ) | ||||||
State |
(3,988 | ) | (2,386 | ) | (1,833 | ) | ||||||
Total deferred |
(21,308 | ) | (24,501 | ) | (19,649 | ) | ||||||
Total benefit |
$ | (19,226 | ) | $ | (13,408 | ) | $ | (17,691 | ) | |||
Classification: |
||||||||||||
Continuing operations |
$ | (18,669 | ) | $ | (53,202 | ) | $ | (19,795 | ) | |||
Discontinued operations |
$ | (557 | ) | $ | 39,794 | $ | 2,104 |
Consolidated losses subject to tax, consisting of pretax income or loss of our taxable REIT
subsidiaries and gains or loss on certain property sales that are subject to income tax under
section 1374 of the Internal Revenue Code, for the years ended December 31, 2009, 2008 and 2007
totaled $40.6 million, $81.8 million and $41.5 million, respectively. The reconciliation of income
tax attributable to continuing and discontinued operations computed at the U.S. statutory rate to
income tax benefit is shown below (dollars in thousands):
2009 | 2008 | 2007 | ||||||||||||||||||||||
Amount | Percent | Amount | Percent | Amount | Percent | |||||||||||||||||||
Tax at U.S. statutory rates on
consolidated loss subject to
tax |
$ | (14,221 | ) | 35.0 | % | $ | (28,632 | ) | 35.0 | % | $ | (14,508 | ) | 35.0 | % | |||||||||
State income tax, net of
Federal tax benefit |
(2,183 | ) | 5.4 | % | 29 | | 106 | (0.3 | %) | |||||||||||||||
Effect of permanent differences |
127 | (0.3 | %) | 215 | (0.3 | %) | (306 | ) | 0.7 | % | ||||||||||||||
Tax effect of intercompany
transfers of assets between
the REIT and taxable REIT
subsidiaries (1) |
(4,759 | ) | 11.7 | %) | 15,059 | (18.4 | %) | | | |||||||||||||||
Write-off of excess tax basis |
(377 | ) | 0.9 | % | (79 | ) | 0.1 | % | (2,983 | ) | 7.2 | % | ||||||||||||
Increase in valuation allowance |
2,187 | (5.4 | %) | | | | | |||||||||||||||||
$ | (19,226 | ) | 47.3 | % | $ | (13,408 | ) | 16.4 | % | $ | (17,691 | ) | 42.6 | % | ||||||||||
(1) | Includes the effect of assets contributed by the Aimco Operating Partnership to taxable
REIT subsidiaries, for which deferred tax expense or benefit was recognized upon the sale
or impairment of the asset by the taxable REIT subsidiary. |
Income taxes paid totaled approximately $4.6 million, $13.8 million and $3.0 million in the
years ended December 31, 2009, 2008 and 2007, respectively.
At December 31, 2009, we had net operating loss carryforwards, or NOLs, of approximately $60.6
million for income tax purposes that expire in years 2027 to 2029. Subject to certain separate
return limitations, we may use these NOLs to offset all or a portion of taxable income generated by
our taxable REIT subsidiaries. We generated approximately $45.9 million of NOLs during the year
ended December 31, 2009, as a result of losses from our taxable REIT subsidiaries. The
deductibility of intercompany interest expense with our taxable REIT subsidiaries is subject to
certain intercompany limitations based upon taxable income as required under Section 163(j) of the
Code. As of December 31, 2009, interest carryovers of approximately $24.6 million, limited by
Section 163(j) of the Code, are available against U.S. Federal tax without expiration. The
deferred tax asset related to these interest carryovers is approximately $9.6 million.
Additionally, our low-income housing and rehabilitation tax credit carryforwards as of December 31,
2009, were approximately $7.4 million for income tax purposes that expire in years 2012 to 2028.
57
For income tax purposes, dividends paid to holders of Common Stock primarily consist of
ordinary income, return of capital, capital gains, qualified dividends and unrecaptured Section
1250 gains, or a combination thereof. For the years ended December 31, 2009, 2008 and 2007,
dividends per share held for the entire year were estimated to be taxable as follows:
2009 (1) (2) | 2008 (3) | 2007 (4) | ||||||||||||||||||||||
Amount | Percentage | Amount | Percentage | Amount | Percentage | |||||||||||||||||||
Ordinary income |
$ | | | $ | | | $ | 0.78 | 18 | % | ||||||||||||||
Capital gains |
0.10 | 26 | % | 4.77 | 64 | % | 2.31 | 54 | % | |||||||||||||||
Qualified dividends |
0.06 | 14 | % | 0.03 | | 0.10 | 2 | % | ||||||||||||||||
Unrecaptured
Section 1250 gain |
0.24 | 60 | % | 2.68 | 36 | % | 1.12 | 26 | % | |||||||||||||||
$ | 0.40 | 100 | % | $ | 7.48 | 100 | % | $ | 4.31 | 100 | % | |||||||||||||
(1) | On December 18, 2009, our Board of Directors declared a quarterly cash dividend of
$0.10 per common share for the quarter ended December 31, 2009, that was paid on January
29, 2010, to stockholders of record on December 31, 2009. Pursuant to certain provisions
in the Code, this dividend was deemed paid by us and received by our shareholders in 2009. |
|
(2) | The Company has designated the per share amounts above as capital gain dividends in
accordance with the requirements under the Code. |
|
(3) | On December 18, 2008, our Board of Directors declared a special dividend of $2.08 per
common share for the quarter ended December 31, 2008, that was paid on January 29, 2009, to
stockholders of record on December 29, 2008. A portion of the special dividend represented
an early payment of the regular quarterly dividend of $0.60 per share that would otherwise
have been paid in February 2009. Pursuant to certain provisions in the Code, this dividend
was deemed paid by us and received by our shareholders in 2008. |
|
(4) | On December 21, 2007, our Board of Directors declared a special dividend of $2.51 per
common share for the quarter ended December 31, 2007, that was paid on January 30, 2008, to
stockholders of record on December 31, 2007. A portion of the special dividend represented
an early payment of the regular quarterly dividend of $0.60 per share that would otherwise
have been paid in February 2008. Pursuant to certain provisions in the Code, this dividend
was deemed paid by us and received by our shareholders in 2007. |
NOTE 10 Transactions Involving Noncontrolling Interests in Aimco Operating Partnership
In December 2008, October 2008, July 2008, and December 2007, the Aimco Operating Partnership
declared special distributions payable on January 29, 2009, December 1, 2008, August 29, 2008 and
January 30, 2008, respectively, to holders of record of common OP Units and High Performance Units
on December 29, 2008, October 27, 2008, July 28, 2008 and December 31, 2007, respectively. The
special distributions were paid on common OP Units and High Performance Units in the amounts listed
below. The Aimco Operating Partnership distributed to us common OP Units equal to the number of
shares we issued pursuant to our corresponding special dividends (discussed in Note 11) in addition
to approximately $0.60 per unit in cash. Holders of common OP Units other than us and holders of
High Performance Units received the distribution entirely in cash.
January 2009 | December 2008 | August 2008 | January 2008 | |||||||||||||
Aimco Operating Partnership Special | Special | Special | Special | Special | ||||||||||||
Distributions | Distribution | Distribution | Distribution | Distribution | ||||||||||||
Distribution per unit |
$ | 2.08 | $ | 1.80 | $ | 3.00 | $ | 2.51 | ||||||||
Total distribution |
$ | 230.1 million | $ | 176.6 million | $ | 285.5 million | $ | 257.2 million | ||||||||
Common OP Units and High Performance Units
outstanding on record date |
110,654,142 | 98,136,520 | 95,151,333 | 102,478,510 | ||||||||||||
Common OP Units held by Aimco |
101,169,951 | 88,650,980 | 85,619,144 | 92,795,891 | ||||||||||||
Total distribution on Aimco common OP Units |
$ | 210.4 million | $ | 159.6 million | $ | 256.9 million | $ | 232.9 million | ||||||||
Cash distribution to Aimco |
$ | 60.6 million | $ | 53.2 million | $ | 51.4 million | $ | 55.0 million | ||||||||
Portion of distribution paid to Aimco
through issuance of common OP Units |
$ | 149.8 million | $ | 106.4 million | $ | 205.5 million | $ | 177.9 million | ||||||||
Common OP Units issued to Aimco pursuant
to distributions |
15,627,330 | 12,572,267 | 5,731,310 | 4,594,074 | ||||||||||||
Cash distributed to common OP Unit and
High Performance Unit holders other than
Aimco |
$ | 19.7 million | $ | 17.0 million | $ | 28.6 million | $ | 24.3 million |
58
Preferred OP Units
Various classes of preferred OP Units of the Aimco Operating Partnership are outstanding.
Depending on the terms of each class, these preferred OP Units are convertible into common OP Units
or redeemable for cash, or at the Aimco Operating Partnerships option, Common Stock, and are paid
distributions varying from 5.9% to 9.6% per annum per unit, or equal to the dividends paid on
Common Stock based on the conversion terms. As of December 31, 2009 and 2008, a total of 3.1
million and 3.2 million preferred OP Units were outstanding with redemption values of $85.7 million
and $88.1 million, respectively. At December 31, 2009 and 2008, a total of 3.1 million and 3.1
million of these preferred OP Units with redemption values of $82.8 million and $85.2 million,
respectively, were redeemable into approximately 5.2 million and 7.4 million shares of Common
Stock, respectively, or cash at the Aimco Operating Partnerships option.
During the years ended December 31, 2009 and 2008, approximately 68,200 and 38,400 preferred
OP Units, respectively, were tendered for redemption in exchange for cash. During the years ended
December 31, 2009 and 2008, no preferred OP Units were tendered for redemption in exchange for
shares of Common Stock. The Aimco Operating Partnership has a redemption policy that requires cash
settlement of redemption requests for the redeemable preferred OP Units, subject to limited
exceptions.
Common OP Units
In 2007, we completed tender offers for limited partnership interests resulting in the
issuance of approximately 55,400 common OP Units. Approximately 55,100 of the common OP Units
issued in 2007 were to unrelated limited partners in VMS in connection with our purchase of seven
properties from the partnership, as discussed in Note 3. In 2009 and 2008, we did not issue a
significant number of common OP Units in connection with tender offers for limited partners.
During the years ended December 31, 2009 and 2008, approximately 64,000 and 50,000 common OP
Units, respectively, were redeemed in exchange for cash, and approximately 519,000 and 114,000
common OP Units, respectively, were redeemed in exchange for shares of Common Stock.
High Performance Units
From 1998 through 2005, the Aimco Operating Partnership issued various classes of High
Performance Units, or HPUs. These HPUs were issued to limited liability companies owned by certain
members of our senior management (and independent directors in the case of Class I HPUs only) in
exchange for cash in amounts that we determined, with the assistance of a nationally recognized
independent valuation expert, to be the fair value of the HPUs. The terms of the HPUs provide for
the issuance, following a measurement period of generally three years of an increased number of
HPUs depending on the degree, if any, to which certain financial performance benchmarks are
achieved over the applicable measurement period. The holders of HPUs at the conclusion of the
measurement period receive the same amount of distributions that are paid to holders of an
equivalent number of the Aimco Operating Partnerships outstanding common OP Units. At December
31, 2009 and 2008, 2,344,719 Class I HPUs, the sole class of HPUs to meet the performance
benchmarks, were outstanding. The minimum performance benchmarks were not achieved for HPU Classes
II through IX. Accordingly, those HPUs had only nominal value at the conclusion of the related
measurement period and were reacquired by the Aimco Operating Partnership and cancelled.
59
NOTE 11 Aimco Equity
Preferred Stock
At December 31, 2009 and 2008, we had the following classes of preferred stock outstanding:
Annual | Balance | |||||||||||||||
Dividend Rate | December 31, | |||||||||||||||
Redemption | Per Share | 2009 | 2008 | |||||||||||||
Date (1) | (paid quarterly) | (thousands) | (thousands) | |||||||||||||
Perpetual: |
||||||||||||||||
Class G Cumulative Preferred Stock, $0.01 par
value, 4,050,000 shares authorized, 4,050,000
shares issued and outstanding (2) |
07/15/2008 | 9.3750 | % | $ | 101,000 | $ | 101,000 | |||||||||
Class T Cumulative Preferred Stock, $0.01 par
value, 6,000,000 shares authorized, 6,000,000
shares issued and outstanding |
07/31/2008 | 8.000 | % | 150,000 | 150,000 | |||||||||||
Class U Cumulative Preferred Stock, $0.01 par
value, 8,000,000 shares authorized, 8,000,000
shares issued and outstanding |
03/24/2009 | 7.750 | % | 200,000 | 200,000 | |||||||||||
Class V Cumulative Preferred Stock, $0.01 par
value, 3,450,000 shares authorized, 3,450,000
shares issued and outstanding |
09/29/2009 | 8.000 | % | 86,250 | 86,250 | |||||||||||
Class Y Cumulative Preferred Stock, $0.01 par
value, 3,450,000 shares authorized, 3,450,000
shares issued and outstanding |
12/21/2009 | 7.875 | % | 86,250 | 86,250 | |||||||||||
Series A Community Reinvestment Act Preferred
Stock, $0.01 par value per share, 240 shares
authorized, 134 and 146 shares issued and
outstanding (3) |
06/30/2011 | (3 | ) | 67,000 | 73,000 | |||||||||||
Total |
$ | 690,500 | $ | 696,500 | ||||||||||||
Less preferred stock subject to repurchase
agreement (4) |
(30,000 | ) | | |||||||||||||
Preferred stock per consolidated balance sheets |
$ | 660,500 | $ | 696,500 | ||||||||||||
(1) | All classes of preferred stock are redeemable at our option on and after the dates specified. |
|
(2) | Includes 10,000 shares held by a consolidated subsidiary that are eliminated in
consolidation. |
|
(3) | During 2006, we sold 200 shares of our Series A Community Reinvestment Act Perpetual
Preferred Stock, $0.01 par value per share, or the CRA Preferred Stock, with a liquidation
preference of $500,000 per share, for net proceeds of $97.5 million. For the period from the
date of original issuance through March 31, 2015, the dividend rate is a variable rate per
annum equal to the Three-Month LIBOR Rate (as defined in the articles supplementary
designating the CRA Preferred Stock) plus 1.25%, calculated as of the beginning of each
quarterly dividend period. The rate at December 31, 2009 and 2008, was 1.54% and 5.01%,
respectively. Upon liquidation, holders of the CRA Preferred Stock are entitled to a
preference of $500,000 per share, plus an amount equal to accumulated, accrued and unpaid
dividends, whether or not earned or declared. The CRA Preferred Stock ranks prior to our
Common Stock and on the same level as our outstanding shares of preferred stock with respect
to the payment of dividends and the distribution of amounts upon liquidation, dissolution or
winding up. The CRA Preferred Stock is not redeemable prior to June 30, 2011, except in
limited circumstances related to REIT qualification. On and after June 30, 2011, the CRA
Preferred Stock is redeemable for cash, in whole or from time to time in part, at our option,
at a price per share equal to the liquidation preference, plus accumulated, accrued and unpaid
dividends, if any, to the redemption date. |
|
(4) | In June 2009, we entered into an agreement to repurchase $36.0 million in liquidation
preference of our CRA Preferred Stock at a 30% discount to the liquidation preference.
Pursuant to this agreement, in June 2009, we repurchased 12 shares, or $6.0 million in
liquidation preference, of CRA Preferred Stock for $4.2 million, and the holder of the CRA
Preferred Stock may require us to repurchase an additional 60 shares, or $30.0 million in
liquidation preference, of CRA Preferred Stock over the next three years, for $21.0 million.
If required, these additional repurchases will be for up to $10.0 million in liquidation
preference in May 2010, 2011 and 2012. Based on the holders ability to require us to
repurchase an additional 60 shares of CRA Preferred Stock pursuant to this agreement, $30.0
million in liquidation preference of CRA Preferred Stock, or the maximum redemption value of
such preferred stock, is classified within temporary equity in our consolidation balance sheet
at December 31, 2009. |
In connection with our June 2009 CRA Preferred Stock repurchase discussed above, we reflected
the $1.8 million excess of the carrying value over the repurchase price, offset by $0.2 million of
issuance costs previously recorded as a
reduction of additional paid-in capital, as a reduction of net income attributable to
preferred stockholders for the year ended December 31, 2009.
60
During 2008, we repurchased 54 shares, or $27.0 million in liquidation preference, of our CRA
Preferred Stock for cash totaling $24.8 million. We reflected the $2.2 million excess of the
carrying value over the redemption price, offset by $0.7 million of issuance costs previously
recorded as a reduction of additional paid-in capital, as a reduction of net income attributable to
preferred stockholders for purposes of calculating earnings per share for the year ended December
31, 2008.
All classes of preferred stock are pari passu with each other and are senior to our Common
Stock. The holders of each class of preferred stock are generally not entitled to vote on matters
submitted to stockholders. Dividends on all shares of preferred stock are subject to declaration by
our Board of Directors. All of the above outstanding classes of preferred stock have a liquidation
preference per share of $25, with the exception of the CRA Preferred Stock, which has a liquidation
preference per share of $500,000.
The dividends paid on each class of preferred stock classified as equity in the years ended
December 31, 2009, 2008 and 2007 are as follows (in thousands, except per share data):
2009 | 2008 | 2007 | ||||||||||||||||||||||
Amount | Total | Amount | Total | Amount | Total | |||||||||||||||||||
Per | Amount | Per | Amount | Per | Amount | |||||||||||||||||||
Class of Preferred Stock | Share (1) | Paid | Share (1) | Paid | Share (1) | Paid | ||||||||||||||||||
Perpetual: |
||||||||||||||||||||||||
Class G |
$ | 2.34 | $ | 9,492 | $ | 2.34 | $ | 9,492 | $ | 2.34 | $ | 9,492 | ||||||||||||
Class T |
2.00 | 12,000 | 2.00 | 12,000 | 2.00 | 12,000 | ||||||||||||||||||
Class U |
1.94 | 15,500 | 1.94 | 15,500 | 1.94 | 15,500 | ||||||||||||||||||
Class V |
2.00 | 6,900 | 2.00 | 6,900 | 2.00 | 6,900 | ||||||||||||||||||
Class Y |
1.97 | 6,792 | 1.97 | 6,792 | 1.97 | 6,792 | ||||||||||||||||||
Series A CRA |
10,841 | (2) | 1,531 | 24,381 | (3) | 4,531 | 41,661 | 8,316 | ||||||||||||||||
52,215 | 55,215 | 59,000 | ||||||||||||||||||||||
Convertible: |
||||||||||||||||||||||||
Class W |
| | | | 4.25 | (4) | 8,100 | |||||||||||||||||
| | 8,100 | ||||||||||||||||||||||
Total |
$ | 52,215 | $ | 55,215 | $ | 67,100 | ||||||||||||||||||
(1) | Amounts per share are calculated based on the number of preferred shares outstanding either
at the end of each year or as of conversion, redemption or repurchase date, as noted. |
|
(2) | Amount per share is based on 134 shares outstanding for the entire period. 12 shares were
repurchased in June 2009 and received $6,509 in dividends through the date of purchase. |
|
(3) | Amount per share is based on 146 shares outstanding for the entire period. 54 shares were
repurchased in September 2008 and received $17,980 in dividends through the date of purchase. |
|
(4) | For the period from January 1, 2007, to the date of redemption. |
Common Stock
In December 2008, October 2008, July 2008 and December 2007, in connection with the Aimco
Operating Partnerships special distributions discussed in Note 10, our Board of Directors declared
corresponding special dividends payable on January 29, 2009, December 1, 2008, August 29, 2008 and
January 30, 2008, respectively, to holders of record of our Common Stock on December 29, 2008,
October 27, 2008, July 28, 2008 and December 31, 2007, respectively. A portion of the special
dividends in the amounts of $0.60 per share represents payment of the regular dividend for the
quarters ended December 31, 2008, September 30, 2008, June 30, 2008 and December 31, 2007,
respectively, and the remaining amount per share represents an additional dividend associated with
taxable gains from property dispositions. Portions of the special dividends were paid through the
issuance of shares of Common Stock. The table below summarizes information regarding these special
dividends.
61
January 2009 | December 2008 | August 2008 | January 2008 | |||||||||||||
Special | Special | Special | Special | |||||||||||||
Aimco Special Dividends | Dividend | Dividend | Dividend | Dividend | ||||||||||||
Dividend per share |
$ | 2.08 | $ | 1.80 | $ | 3.00 | $ | 2.51 | ||||||||
Outstanding shares of Common
Stock on the record date |
101,169,951 | 88,650,980 | 85,619,144 | 92,795,891 | ||||||||||||
Total dividend |
$ | 210.4 million | $ | 159.6 million | $ | 256.9 million | $ | 232.9 million | ||||||||
Portion of dividend paid in cash |
$ | 60.6 million | $ | 53.2 million | $ | 51.4 million | $ | 55.0 million | ||||||||
Portion of dividend paid through
issuance of shares |
$ | 149.8 million | $ | 106.4 million | $ | 205.5 million | $ | 177.9 million | ||||||||
Shares issued pursuant to dividend |
15,627,330 | 12,572,267 | 5,731,310 | 4,594,074 | ||||||||||||
Average share price on
determination date |
$ | 9.58 | $ | 8.46 | $ | 35.84 | $ | 38.71 | ||||||||
Amounts after elimination of the
effects of shares of Common Stock
held by consolidated
subsidiaries: |
||||||||||||||||
Outstanding shares of Common
Stock on the record date |
100,642,817 | 88,186,456 | 85,182,665 | 92,379,751 | ||||||||||||
Total dividend |
$ | 209.3 million | $ | 158.7 million | $ | 255.5 million | $ | 231.9 million | ||||||||
Portion of dividend paid in cash |
$ | 60.3 million | $ | 52.9 million | $ | 51.1 million | $ | 54.8 million | ||||||||
Portion of dividend paid through
issuance of shares |
$ | 149.0 million | $ | 105.8 million | $ | 204.4 million | $ | 177.1 million | ||||||||
Shares issued pursuant to dividend |
15,548,996 | 12,509,657 | 5,703,265 | 4,573,735 |
As discussed in Note 2, during December 2009, we adopted the provisions of ASU 2010-01, which
relate to accounting for dividends with components of cash and stock. In prior periods, we treated
the shares of stock issued in our special dividends similar to stock dividends, with a
reclassification within consolidated equity at the beginning of the earliest period presented. In
connection with our adoption of ASU 2010-01, we retrospectively adjusted our consolidated balance
sheet at December 31, 2008, by increasing accrued liabilities and other by $149.0 million,
representing the portion of our special dividend declared in December 2008 that was paid in January
2009 through the issuance of common stock.
During 2008, we issued approximately 17,000 shares of Common Stock to certain non-executive
officers who purchased the shares at market prices. In exchange for the shares purchased, the
officers executed notes payable totaling $0.6 million. No shares were issued under similar
arrangements during 2009. These notes, which are 25% recourse to the borrowers, have a 10-year
maturity and bear interest either at a fixed rate of 6% annually or a floating rate based on the
30-day LIBOR plus 3.85%, which is subject to an annual interest rate cap of typically 7.25%. Total
payments in 2009 and 2008 on all notes from officers were $0.8 million and $1.5 million,
respectively. In 2009 and 2008, we reacquired approximately 94,000 and 31,000 shares of Common
Stock from officers in exchange for the cancellation of related notes totaling $1.5 million and
$1.0 million, respectively.
In addition, in 2009 and 2008, we issued approximately 378,000 and 225,000 restricted shares
of Common Stock, respectively, to certain officers and employees. The restricted stock was recorded
at the fair market value of the Common Stock on the date of issuance. These shares of restricted
Common Stock may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of
and are subject to a risk of forfeiture prior to the expiration of the applicable vesting period
(ratably over a period of four years).
In 2008 and 2007, we purchased in the open market approximately 13.9 million and 7.5 million
shares of Common Stock, respectively, at an average price per share of approximately $34.02 and
$43.70, respectively. During 2009, we did not repurchase any shares of Common Stock on the open
market.
Registration Statements
We and the Aimco Operating Partnership have a shelf registration statement that provides for
the issuance of debt and equity securities by Aimco and debt securities by the Aimco Operating
Partnership.
62
NOTE 12 Share-Based Compensation and Employee Benefit Plans
Stock Award and Incentive Plan
We adopted the Apartment Investment and Management Company 1997 Stock Award and Incentive
Plan, or the 1997 Plan, to attract and retain officers, key employees and independent directors.
The 1997 Plan reserved for issuance a maximum of 20 million shares, which may be in the form of
incentive stock options, non-qualified stock options and restricted stock, or other types of awards
as authorized under the 1997 Plan. The 1997 Plan expired on April 24, 2007. On April 30, 2007,
the 2007 Stock Award and Incentive Plan, or the 2007 Plan, was approved as successor to the 1997
Plan. The 2007 Plan reserves for issuance a maximum of 4.1 million shares, which may be in the
form of incentive stock options, non-qualified stock options and restricted stock, or other types
of awards as authorized under the 2007 Plan. Pursuant to the anti-dilution provisions of the 2007
Plan, the number of shares reserved for issuance has been adjusted to reflect the special dividends
discussed in Note 11. At December 31, 2009 there were approximately 1.7 million shares available to
be granted under the 2007 Plan. The 2007 Plan is administered by the Compensation and Human
Resources Committee of the Board of Directors. In the case of stock options, the exercise price of
the options granted may not be less than the fair market value of Common Stock at the date of
grant. The term of the options is generally ten years from the date of grant. The options
typically vest over a period of one to four or five years from the date of grant. We generally
issue new shares upon exercise of options. Restricted stock awards typically vest over a period of
three to five years.
Refer to Stock-Based Compensation in Note 2 for discussion of our accounting policy related to
stock-based compensation.
We estimated the fair value of our options using a Black-Scholes closed-form valuation model
using the assumptions set forth in the table below. For options granted in 2009 and 2008, the
expected term of the options was based on historical option exercises and post-vesting
terminations. For options granted in 2007, the expected term of the options reflects the average
of the vesting period and the contractual term for the options, with the exception of a grant of
approximately 0.6 million options to an executive during 2007, for which the expected term used was
equal to the vesting period of five years. Expected volatility reflects the historical volatility
of our Common Stock during the historical period commensurate with the expected term of the options
that ended on the date of grant. The expected dividend yield reflects expectations regarding cash
dividend amounts per share paid on our Common Stock during the expected term of the option and the
risk-free interest rate reflects the annualized yield of a zero coupon U.S. Treasury security with
a term equal to the expected term of the option. The weighted average fair value of options and
our valuation assumptions for the years ended December 31, 2009, 2008 and 2007 were as follows:
2009 | 2008 | 2007 | ||||||||||
Weighted average grant-date fair value |
$ | 2.47 | $ | 4.34 | $ | 6.28 | ||||||
Assumptions: |
||||||||||||
Risk-free interest rate |
2.26 | % | 3.12 | % | 4.70 | % | ||||||
Expected dividend yield |
8.00 | % | 6.02 | % | 4.94 | % | ||||||
Expected volatility |
45.64 | % | 24.02 | % | 21.66 | % | ||||||
Weighted average expected life of options |
6.9 years | 6.5 years | 5.6 years |
63
The following table summarizes activity for our outstanding stock options for the years ended
December 31, 2009, 2008 and 2007 (numbers of options in thousands):
2009(1) | 2008(1) | 2007(1) | ||||||||||||||||||||||
Weighted | Weighted | Weighted | ||||||||||||||||||||||
Number | Average | Number | Average | Number | Average | |||||||||||||||||||
of | Exercise | of | Exercise | of | Exercise | |||||||||||||||||||
Options | Price | Options | Price | Options | Price | |||||||||||||||||||
Outstanding at beginning
of year |
10,344 | $ | 31.01 | 8,555 | $ | 39.57 | 8,598 | $ | 39.36 | |||||||||||||||
Granted |
965 | 8.92 | 980 | 39.77 | 955 | 57.25 | ||||||||||||||||||
Exercised |
| | (14 | ) | 37.45 | (1,403 | ) | 38.29 | ||||||||||||||||
Forfeited |
(2,436 | ) | 32.03 | (1,423 | ) | 38.75 | (26 | ) | 37.83 | |||||||||||||||
Adjustment to outstanding
options pursuant to
special dividends |
| n/a | 2,246 | n/a | 431 | n/a | ||||||||||||||||||
Outstanding at end of year |
8,873 | $ | 28.22 | 10,344 | $ | 31.01 | 8,555 | $ | 39.57 | |||||||||||||||
Exercisable at end of year |
6,840 | $ | 29.65 | 7,221 | $ | 29.51 | 6,417 | $ | 37.75 |
(1) | In connection with the special dividends discussed in Note 11, effective on the record date
of each dividend, the number of options and exercise prices of all outstanding awards were
adjusted pursuant to the anti-dilution provisions of the applicable plans based on the market
price of our stock on the ex-dividend dates of the related special dividends. The adjustment
to the number of outstanding options is reflected in the table separate from the other
activity during the periods at the weighted average exercise price for those outstanding
options. The exercise prices for options granted, exercised and forfeited in the table above
reflect the actual exercise prices at the time of the related activity. The number and
weighted average exercise price for options outstanding and exercisable at the end of year
reflect the adjustments for the applicable special dividends. The adjustment of the awards
pursuant to the special dividends is considered a modification of the awards, but did not
result in a change in the fair value of any awards and therefore did not result in a change in
total compensation to be recognized over the remaining term of the awards. |
The intrinsic value of a stock option represents the amount by which the current price of the
underlying stock exceeds the exercise price of the option. Options outstanding at December 31,
2009, had an aggregate intrinsic value of $5.7 million and a weighted average remaining contractual
term of 4.4 years. Options exercisable at December 31, 2008, had no aggregate intrinsic value and
a weighted average remaining contractual term of 5.7 years. No stock options were exercised during
the year ended 2009. The intrinsic value of stock options exercised during the years ended
December 31, 2008 and 2007, was less than $0.1 million and $28.9 million, respectively. We may
realize tax benefits in connection with the exercise of options by employees of our taxable
subsidiaries. As no stock options were exercised during the year ended December 31, 2009, we
realized no related tax benefits.
The following table summarizes activity for restricted stock awards for the years ended
December 31, 2009, 2008 and 2007 (numbers of shares in thousands):
2009 | 2008 | 2007 | ||||||||||||||||||||||
Weighted | Weighted | |||||||||||||||||||||||
Average | Weighted | Average | ||||||||||||||||||||||
Number | Grant- | Number | Average | Number | Grant- | |||||||||||||||||||
of | Date | of | Grant-Date | of | Date | |||||||||||||||||||
Shares | Fair Value | Shares | Fair Value | Shares | Fair Value | |||||||||||||||||||
Unvested at beginning
of year |
893 | $ | 40.33 | 960 | $ | 46.08 | 1,088 | $ | 40.11 | |||||||||||||||
Granted |
378 | 8.92 | 248 | 39.85 | 308 | 60.13 | ||||||||||||||||||
Vested |
(418 | ) | 34.42 | (377 | ) | 43.45 | (387 | ) | 40.31 | |||||||||||||||
Forfeited |
(533 | ) | 28.57 | (128 | ) | 46.85 | (49 | ) | 47.43 | |||||||||||||||
Issued pursuant to
special dividends (1) |
138 | 9.58 | 190 | 22.51 | | | ||||||||||||||||||
Unvested at end of year |
458 | $ | 24.23 | 893 | $ | 40.33 | 960 | $ | 46.08 | |||||||||||||||
(1) | This represents shares of restricted stock issued to holders of restricted stock pursuant to
the special dividends discussed in Note 11. The weighted average grant-date fair value for
these shares represents the price of our stock on the determination date for each dividend.
The issuance of the additional shares of restricted stock resulted in no incremental
compensation expense. |
The aggregate fair value of shares that vested during the years ended December 31, 2009, 2008
and 2007 was $3.1 million, $16.5 million and $19.5 million, respectively.
64
Total compensation cost recognized for restricted stock and stock option awards was $8.0
million, $17.6 million and $19.2 million for the years ended December 31, 2009, 2008 and 2007,
respectively. Of these amounts, $1.3 million, $3.8 million and $4.3 million, respectively, were
capitalized. At December 31, 2009, total unvested compensation cost not yet recognized was $10.1
million. We expect to recognize this compensation over a weighted average period of approximately
1.5 years.
Employee Stock Purchase Plan
Under the terms of our employee stock purchase plan, eligible employees may authorize payroll
deductions up to 15% of their base compensation to purchase shares of our Common Stock at a five
percent discount from its fair value on the last day of the calendar quarter during which payroll
deductions are made. In 2009, 2008 and 2007, 20,076, 8,926 and 3,751 shares were purchased under
this plan at an average price of $8.82, $23.86 and $44.67, respectively. No compensation cost is
recognized in connection with this plan.
401(k) Plan
We provide a 401(k) defined-contribution employee savings plan. Employees who have completed
30 days of service and are age 18 or older are eligible to participate. For the period from
January 1, 2009 through January 29, 2009, and during the years ended December 31, 2008 and 2007,
our matching contributions were made in the following manner: (1) a 100% match on the first 3% of
the participants compensation; and (2) a 50% match on the next 2% of the participants
compensation. On December 31, 2008, we suspended employer matching contributions effective January
29, 2009. We may reinstate employer matching contributions at any time. We incurred costs in
connection with this plan of approximately $0.6 million, $5.2 million and $5.2 million in 2009,
2008 and 2007, respectively.
NOTE 13 Discontinued Operations and Assets Held for Sale
We report as discontinued operations real estate assets that meet the definition of a
component of an entity and have been sold or meet the criteria to be classified as held for sale.
We include all results of these discontinued operations, less applicable income taxes, in a
separate component of income on the consolidated statements of income under the heading income
from discontinued operations, net. This treatment resulted in the retrospective adjustment of
2009, 2008 and 2007 financial statement amounts to reflect as discontinued operations all
properties sold or classified as held for sale as of September 30, 2010.
We are currently marketing for sale certain real estate properties that are inconsistent with
our long-term investment strategy. At the end of each reporting period, we evaluate whether such
properties meet the criteria to be classified as held for sale, including whether such properties
are expected to be sold within 12 months. Additionally, certain properties that do not meet all of
the criteria to be classified as held for sale at the balance sheet date may nevertheless be sold
and included in discontinued operations in the subsequent 12 months; thus the number of properties
that may be sold during the subsequent 12 months could exceed the number classified as held for
sale. At December 31, 2009 and 2008, we had 31 and 120
properties, with an aggregate of 5,825 and
28,328 units, classified as held for sale, respectively. Amounts classified as held for sale in
the accompanying consolidated balance sheets are as follows (in thousands):
December 31, | December 31, | |||||||
2009 | 2008 | |||||||
Real estate, net |
$ | 199,743 | $ | 1,228,368 | ||||
Other assets |
3,927 | 17,214 | ||||||
Assets held for sale |
$ | 203,670 | $ | 1,245,582 | ||||
Property debt |
$ | 178,339 | $ | 909,360 | ||||
Other liabilities |
5,553 | 15,316 | ||||||
Liabilities related to assets held for sale |
$ | 183,892 | $ | 924,676 | ||||
During the years ended December 31, 2009, 2008 and 2007, we sold 89, 151 and 73 consolidated
properties with an aggregate 22,503, 37,202 and 11,588 units, respectively. For the years ended
December 31, 2009, 2008 and 2007, discontinued operations includes the results of operations for
the periods prior to the date of sale for all properties sold or classified as held for sale as of
September 30, 2010.
65
The following is a summary of the components of income from discontinued operations for the
years ended December 31, 2009, 2008 and 2007 (in thousands):
2009 | 2008 | 2007 | ||||||||||
Rental and other property revenues |
$ | 196,838 | $ | 506,979 | $ | 641,531 | ||||||
Property operating expenses |
(98,471 | ) | (251,611 | ) | (317,220 | ) | ||||||
Depreciation and amortization |
(61,634 | ) | (132,463 | ) | (162,134 | ) | ||||||
Provision for operating real estate impairment
losses |
(54,530 | ) | (27,420 | ) | (5,430 | ) | ||||||
Other expenses, net |
(11,921 | ) | (13,402 | ) | (7,972 | ) | ||||||
Operating (loss) income |
(29,718 | ) | 82,083 | 148,775 | ||||||||
Interest income |
349 | 2,008 | 4,157 | |||||||||
Interest expense |
(39,337 | ) | (98,467 | ) | (125,554 | ) | ||||||
Gain on extinguishment of debt |
259 | | 32,701 | |||||||||
(Loss) income before gain on dispositions
of real estate and income taxes |
(68,447 | ) | (14,376 | ) | 60,079 | |||||||
Gain on dispositions of real estate |
221,793 | 800,335 | 117,628 | |||||||||
Income tax benefit (expense) |
557 | (39,794 | ) | (2,104 | ) | |||||||
Income from discontinued operations, net |
$ | 153,903 | $ | 746,165 | $ | 175,603 | ||||||
Income from discontinued operation
attributable to: |
||||||||||||
Noncontrolling interests in consolidated
real estate partnerships |
$ | (62,085 | ) | $ | (150,140 | ) | $ | (72,211 | ) | |||
Noncontrolling interests in Aimco
Operating Partnership |
(6,652 | ) | (57,732 | ) | (9,592 | ) | ||||||
Total noncontrolling interests |
(68,737 | ) | (207,872 | ) | (81,803 | ) | ||||||
Aimco |
$ | 85,166 | $ | 538,293 | $ | 93,800 | ||||||
Gain on dispositions of real estate is reported net of incremental direct costs incurred in
connection with the transaction, including any prepayment penalties incurred upon repayment of
property loans collateralized by the property being sold. Such prepayment penalties totaled $29.0
million, $64.9 million and $12.6 million for the years ended December 31, 2009, 2008 and 2007,
respectively. We classify interest expense related to property debt within discontinued operations
when the related real estate asset is sold or classified as held for sale. As discussed in Note 2,
during the year ended December 31, 2009, we allocated $10.1 million of goodwill related to our real
estate segment to the carrying amounts of the properties sold or classified as held for sale. Of
these amounts, $8.7 million was reflected as a reduction of gain on dispositions of real estate and
$1.4 million was reflected as an adjustment of impairment losses.
66
NOTE 14 Earnings per Share
We calculate earnings per share based on the weighted average number of shares of Common
Stock, participating securities, common stock equivalents and dilutive convertible securities
outstanding during the period. The following table illustrates the calculation of basic and
diluted earnings per share for the years ended December 31, 2009, 2008 and 2007 (in thousands,
except per share data):
2009 | 2008 | 2007 | ||||||||||
Numerator: |
||||||||||||
Loss from continuing operations |
$ | (198,703 | ) | $ | (119,163 | ) | $ | (50,097 | ) | |||
Loss (income) from continuing operations
attributable to noncontrolling interests |
49,263 | (7,123 | ) | (13,792 | ) | |||||||
Income attributable to preferred stockholders |
(50,566 | ) | (53,708 | ) | (66,016 | ) | ||||||
Income attributable to participating securities |
| (6,985 | ) | (4,481 | ) | |||||||
Loss from continuing operations attributable to
Aimco common stockholders |
$ | (200,006 | ) | $ | (186,979 | ) | $ | (134,386 | ) | |||
Income from discontinued operations |
$ | 153,903 | $ | 746,165 | $ | 175,603 | ||||||
Income from discontinued operations attributable
to noncontrolling interests |
(68,737 | ) | (207,872 | ) | (81,803 | ) | ||||||
Income from discontinued operations
attributable to Aimco common stockholders |
$ | 85,166 | $ | 538,293 | $ | 93,800 | ||||||
Net (loss) income |
$ | (44,800 | ) | $ | 627,002 | $ | 125,506 | |||||
Net income attributable to noncontrolling interests |
(19,474 | ) | (214,995 | ) | (95,595 | ) | ||||||
Income attributable to preferred stockholders |
(50,566 | ) | (53,708 | ) | (66,016 | ) | ||||||
Income attributable to participating securities |
| (6,985 | ) | (4,481 | ) | |||||||
Net (loss) income attributable to Aimco common
stockholders |
$ | (114,840 | ) | $ | 351,314 | $ | (40,586 | ) | ||||
Denominator: |
||||||||||||
Denominator for basic earnings per share
weighted average number of shares of Common Stock
outstanding |
114,301 | 88,690 | 95,107 | |||||||||
Effect of dilutive securities: |
||||||||||||
Dilutive potential common shares |
| | | |||||||||
Denominator for diluted earnings per share |
114,301 | 88,690 | 95,107 | |||||||||
Earnings (loss) per common share basic and
diluted: |
||||||||||||
Loss from continuing operations attributable to
Aimco common stockholders |
$ | (1.75 | ) | $ | (2.11 | ) | $ | (1.42 | ) | |||
Income from discontinued operations attributable
to Aimco common stockholders |
0.75 | 6.07 | 0.99 | |||||||||
Net (loss) income attributable to Aimco common
stockholders |
$ | (1.00 | ) | $ | 3.96 | $ | (0.43 | ) | ||||
As discussed in Note 2, earnings (loss) per common share for the years ended December 31, 2008
and 2007 have been retroactively adjusted for the effect of our adoption of FSP EITF 03-6-1 and
FASB ASU 2010-01.
As of December 31, 2009, 2008 and 2007, the common share equivalents that could potentially
dilute basic earnings per share in future periods totaled 8.9 million, 9.2 million and 8.1 million,
respectively. These securities, representing stock options, have been excluded from the earnings
per share computations for the years ended December 31, 2009, 2008 and 2007, because their effect
would have been anti-dilutive.
Participating securities, consisting of unvested restricted stock and shares purchased
pursuant to officer loans, receive dividends similar to shares of Common Stock and totaled 0.5
million, 1.0 million and 1.2 million at December 31, 2009, 2008 and 2007, respectively. The effect
of participating securities is reflected in basic and diluted earnings per share computations for
the periods presented above using the two-class method of allocating distributed and undistributed
earnings. During the year ended December 31, 2009, the adjustment to compensation expense
recognized related to cumulative dividends on forfeited shares of restricted stock exceeded the
amount of dividends declared related to participating securities. Accordingly, distributed
earnings attributed to participating securities during 2009 were reduced to zero for purposes of
calculating earnings per share using the two-class method.
67
As discussed in Note 10, the Aimco Operating Partnership has various classes of preferred OP
units, which may be redeemed at the holders option. The Aimco Operating Partnership may redeem
these units for cash or at its option, shares of Common Stock. During the periods presented, no
common share equivalents related to these preferred OP units have been included in earnings per
share computations because their effect was antidilutive.
NOTE 15 Unaudited Summarized Consolidated Quarterly Information
Summarized unaudited consolidated quarterly information for 2009 and 2008 is provided below
(in thousands, except per share amounts).
Quarter (1) | ||||||||||||||||
2009 | First | Second | Third | Fourth | ||||||||||||
Total revenues |
$ | 286,386 | $ | 288,066 | $ | 285,397 | $ | 291,887 | ||||||||
Total operating expenses |
(256,316 | ) | (258,578 | ) | (268,206 | ) | (268,294 | ) | ||||||||
Operating income |
30,070 | 29,488 | 17,191 | 23,593 | ||||||||||||
Loss from continuing operations |
(34,886 | ) | (46,191 | ) | (54,964 | ) | (62,662 | ) | ||||||||
Income from discontinued operations, net |
2,315 | 38,563 | 45,407 | 67,618 | ||||||||||||
Net (loss) income |
(32,571 | ) | (7,628 | ) | (9,557 | ) | 4,956 | |||||||||
Loss attributable to Aimco common stockholders |
(37,698 | ) | (29,924 | ) | (40,490 | ) | (6,728 | ) | ||||||||
Loss per common share basic and diluted: |
||||||||||||||||
Loss from continuing operations attributable to
Aimco common stockholders |
$ | (0.32 | ) | $ | (0.40 | ) | $ | (0.45 | ) | $ | (0.57 | ) | ||||
Net loss attributable to Aimco common stockholders |
$ | (0.34 | ) | $ | (0.26 | ) | $ | (0.34 | ) | $ | (0.06 | ) | ||||
Weighted average common shares outstanding (2) |
110,262 | 115,510 | 115,563 | 115,871 | ||||||||||||
Weighted average common shares and common share
equivalents outstanding (2) |
110,262 | 115,510 | 115,563 | 115,871 |
Quarter (1) | ||||||||||||||||
2008 | First | Second | Third | Fourth | ||||||||||||
Total revenues |
$ | 285,524 | $ | 310,371 | $ | 310,213 | $ | 293,315 | ||||||||
Total operating expenses (3) |
(247,611 | ) | (256,302 | ) | (265,632 | ) | (381,914 | ) | ||||||||
Operating income (loss) (3) |
37,913 | 54,069 | 44,581 | (88,599 | ) | |||||||||||
(Loss) income from continuing operations (3) |
(31,171 | ) | (20,853 | ) | 74,785 | (141,924 | ) | |||||||||
Income from discontinued operations, net |
7,511 | 363,807 | 162,604 | 212,243 | ||||||||||||
Net (loss) income |
(23,660 | ) | 342,954 | 237,389 | 70,319 | |||||||||||
Net (loss) income attributable to Aimco common
stockholders |
(38,857 | ) | 239,119 | 158,313 | (9,898 | ) | ||||||||||
Earnings (loss) per common share basic and diluted: |
||||||||||||||||
(Loss) income from continuing operations
attributable to Aimco common stockholders |
$ | (0.47 | ) | $ | (0.49 | ) | $ | 0.56 | $ | (1.62 | ) | |||||
Net (loss) income attributable to Aimco common
stockholders |
$ | (0.43 | ) | $ | 2.72 | $ | 1.84 | $ | (0.11 | ) | ||||||
Weighted average common shares outstanding (2) |
89,465 | 87,790 | 85,992 | 91,515 | ||||||||||||
Weighted average common shares and common share
equivalents outstanding (2) |
89,465 | 87,790 | 86,297 | 91,515 |
(1) | Certain reclassifications have been made to 2009 and 2008 quarterly amounts primarily
related to treatment of discontinued operations for properties sold or classified as held
for sale through September 30, 2010 and related to newly adopted accounting standards
during 2009 (see Note 2). |
|
(2) | As discussed in Note 2, in December 2009, we adopted the provisions of ASU 2010-01,
which resulted in reductions in the number of weighted average common shares and common
share equivalents outstanding, as compared to the amounts previously reported. |
|
(3) | Total operating expenses, operating income (loss) and (loss) income from continuing
operations for the quarter ended December 31, 2008, includes a $91.1 million provision for
impairment losses on real estate development assets, which is discussed further in Note 2. |
68
NOTE 16 Transactions with Affiliates
We earn revenue from affiliated real estate partnerships. These revenues include fees for
property management services, partnership and asset management services, risk management services
and transactional services such as refinancing, construction supervisory and disposition (including
promote income, which is income earned in connection with the disposition of properties owned by
certain of our consolidated joint ventures). In addition, we are reimbursed for our costs in
connection with the management of the unconsolidated real estate partnerships. These fees and
reimbursements for the years ended December 31, 2009, 2008 and 2007 totaled $18.5 million, $72.5
million and $42.1 million, respectively. The total accounts receivable due from affiliates was
$23.7 million, net of allowance for doubtful accounts of $3.4 million, at December 31, 2009, and
$39.0 million, net of allowance for doubtful accounts of $2.8 million, at December 31, 2008.
Additionally, we earn interest income on notes from real estate partnerships in which we are
the general partner and hold either par value or discounted notes. During the years ended December
31, 2009 and 2008, we did not recognize a significant amount of interest income on par value notes
from unconsolidated real estate partnerships. Interest income earned on par value notes from
unconsolidated real estate partnerships totaled $8.1 million for the year ended December 31, 2007.
Accretion income recognized on discounted notes from affiliated real estate partnerships totaled
$0.1 million, $1.4 million and $8.1 million for the years ended December 31, 2009, 2008 and 2007,
respectively. See Note 5 for additional information on notes receivable from unconsolidated real
estate partnerships.
NOTE 17 Business Segments
Based on a planned reduction in our transactional activities, during the three months ended
March 31, 2010, we reevaluated our reportable segments and determined our investment management
reporting unit no longer meets the requirements for a reportable segment. Additionally, to provide
more meaningful information regarding our real estate operations, we elected to disaggregate
information for the prior real estate segment. Following these changes, we have two reportable
segments: conventional real estate operations and affordable real estate operations. Our
conventional real estate operations consist of market-rate apartments with rents paid by the
resident and included 226 properties with 70,680 units as of December 31, 2009. Our affordable
real estate operations consisted of 241 properties with 27,591 units as of December 31, 2009, with
rents that are generally paid, in whole or part, by a government agency. Based on this change in
reportable segments, we have recast the presentation of our results of operations for the years
ended December 31, 2009, 2008 and 2007, as presented below.
Our chief operating decision maker uses various generally accepted industry financial measures
to assess the performance and financial conditions of the business, including: Net Asset Value,
which is the estimated fair value of our assets, net of debt, or NAV; Funds From Operations, or
FFO; Adjusted FFO, or AFFO, which is FFO less spending for Capital Replacements; same store
property operating results; net operating income; Free Cash Flow which is net operating income less
spending for Capital Replacements; financial coverage ratios; and leverage as shown on our balance
sheet. Our chief operating decision maker emphasizes net operating income as a key measurement of
segment profit or loss. Segment net operating income is generally defined as segment revenues less
direct segment operating expenses.
69
The following tables present the revenues, net operating income (loss) and income (loss) from
continuing operations of our conventional and affordable real estate operations segments for the
years ended December 31, 2009, 2008 and 2007 (in thousands):
Corporate | ||||||||||||||||
Not Allocated | ||||||||||||||||
Conventional | Affordable | to Segments | Total | |||||||||||||
Year Ended December 31, 2009: |
||||||||||||||||
Rental and other property revenues (1) |
$ | 909,218 | $ | 187,583 | $ | 5,082 | $ | 1,101,883 | ||||||||
Asset management and tax credit revenues |
| | 49,853 | 49,853 | ||||||||||||
Total revenues |
909,218 | 187,583 | 54,935 | 1,151,736 | ||||||||||||
Property operating expenses (1) |
363,863 | 92,416 | 59,469 | 515,748 | ||||||||||||
Investment management expenses |
| | 15,779 | 15,779 | ||||||||||||
Depreciation and amortization (1) |
| | 433,933 | 433,933 | ||||||||||||
Provision for operating real estate
impairment losses |
| | 2,329 | 2,329 | ||||||||||||
General and administrative expenses |
| | 56,643 | 56,643 | ||||||||||||
Other expenses, net |
| | 15,721 | 15,721 | ||||||||||||
Restructuring costs |
| | 11,241 | 11,241 | ||||||||||||
Total operating expenses |
363,863 | 92,416 | 595,115 | 1,051,394 | ||||||||||||
Net operating income (loss) |
545,355 | 95,167 | (540,180 | ) | 100,342 | |||||||||||
Other items included in continuing
operations |
| | (299,045 | ) | (299,045 | ) | ||||||||||
Income (loss) from continuing operations |
$ | 545,355 | $ | 95,167 | $ | (839,225 | ) | $ | (198,703 | ) | ||||||
Corporate | ||||||||||||||||
Not Allocated | ||||||||||||||||
Conventional | Affordable | to Segments | Total | |||||||||||||
Year Ended December 31, 2008: |
||||||||||||||||
Rental and other property revenues (1) |
$ | 913,793 | $ | 180,456 | $ | 6,344 | $ | 1,100,593 | ||||||||
Asset management and tax credit revenues |
| | 98,830 | 98,830 | ||||||||||||
Total revenues |
913,793 | 180,456 | 105,174 | 1,199,423 | ||||||||||||
Property operating expenses (1) |
360,479 | 91,867 | 74,870 | 527,216 | ||||||||||||
Investment management expenses |
| | 24,784 | 24,784 | ||||||||||||
Depreciation and amortization (1) |
| | 383,084 | 383,084 | ||||||||||||
Provision for impairment losses on real
estate development assets |
| | 91,138 | 91,138 | ||||||||||||
General and administrative expenses |
| | 80,376 | 80,376 | ||||||||||||
Other expenses, net |
| | 22,059 | 22,059 | ||||||||||||
Restructuring costs |
| | 22,802 | 22,802 | ||||||||||||
Total operating expenses |
360,479 | 91,867 | 699,113 | 1,151,459 | ||||||||||||
Net operating income (loss) |
553,314 | 88,589 | (593,939 | ) | 47,964 | |||||||||||
Other items included in continuing
operations |
| | (167,127 | ) | (167,127 | ) | ||||||||||
Income (loss) from continuing operations |
$ | 553,314 | $ | 88,589 | $ | (761,066 | ) | $ | (119,163 | ) | ||||||
70
Corporate | ||||||||||||||||
Not Allocated | ||||||||||||||||
Conventional | Affordable | to Segments | Total | |||||||||||||
Year Ended December 31, 2007: |
||||||||||||||||
Rental and other property revenues (1) |
$ | 882,545 | $ | 168,885 | $ | 6,924 | $ | 1,058,354 | ||||||||
Asset management and tax credit revenues |
| | 73,755 | 73,755 | ||||||||||||
Total revenues |
882,545 | 168,885 | 80,679 | 1,132,109 | ||||||||||||
Property operating expenses (1) |
354,455 | 83,126 | 69,822 | 507,403 | ||||||||||||
Investment management expenses |
| | 20,507 | 20,507 | ||||||||||||
Depreciation and amortization (1) |
| | 337,804 | 337,804 | ||||||||||||
Provision for operating real estate
impairment losses |
| | 1,080 | 1,080 | ||||||||||||
General and administrative expenses |
| | 72,359 | 72,359 | ||||||||||||
Other expenses, net |
| | 18,917 | 18,917 | ||||||||||||
Total operating expenses |
354,455 | 83,126 | 520,489 | 958,070 | ||||||||||||
Net operating income (loss) |
528,090 | 85,759 | (439,810 | ) | 174,039 | |||||||||||
Other items included in continuing
operations |
| | (224,136 | ) | (224,136 | ) | ||||||||||
Income (loss) from continuing operations |
$ | 528,090 | $ | 85,759 | $ | (663,946 | ) | $ | (50,097 | ) | ||||||
(1) | Our chief operating decision maker assesses the performance of our conventional and
affordable real estate operations using among other measures, net operating income, excluding
property management revenues and certain property management expenses, casualty gains and
losses, depreciation and amortization and provision for operating real estate impairment
losses. Accordingly, we do not allocate these amounts to our segments. |
During the years ended December 31, 2009, 2008 and 2007, for continuing operations, our rental
revenues include $129.8 million, $122.2 million and $112.0 million, respectively, of subsidies from
government agencies, which represented 11.8%, 11.1% and 10.6%, respectively, of our real estate
operations revenues.
The assets of our reportable segments are as follows (in thousands):
December 31, | December 31, | |||||||
2009 | 2008 | |||||||
Conventional |
$ | 6,032,483 | 6,310,421 | |||||
Affordable |
1,130,089 | 1,205,157 | ||||||
Corporate and other assets |
743,896 | 1,926,292 | ||||||
Total consolidated assets |
$ | 7,906,468 | 9,441,870 | |||||
For the years ended December 31, 2009, 2008 and 2007, capital additions related to our
conventional segment totaled $208.0 million, $516.6 million and $595.6 million, respectively, and
capital additions related to our affordable segment totaled $67.4 million, $148.6 million and $94.1
million, respectively.
71
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
SCHEDULE III: REAL ESTATE AND ACCUMULATED DEPRECIATION
December 31, 2009
(In Thousands Except Unit Data)
SCHEDULE III: REAL ESTATE AND ACCUMULATED DEPRECIATION
December 31, 2009
(In Thousands Except Unit Data)
(2) | (3) | |||||||||||||||||||||||||||||||||||||||||||||||
(1) | Initial Cost | Cost Capitalized | December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Property | Date | Year | Number | Buildings and | Subsequent to | Buildings and | (5) | Accumulated | Total Cost | |||||||||||||||||||||||||||||||||||||||
Property Name | Type | Consolidated | Location | Built | of Units | Land | Improvements | Consolidation | Land | Improvements | Total | Depreciation (AD) | Net of AD | Encumbrances | ||||||||||||||||||||||||||||||||||
Continuing Operations: |
||||||||||||||||||||||||||||||||||||||||||||||||
Conventional Properties: |
||||||||||||||||||||||||||||||||||||||||||||||||
100 Forest Place |
High Rise | Dec-97 | OakPark, IL | 1987 | 234 | 2,664 | 18,815 | 4,493 | 2,664 | 23,308 | 25,972 | (8,692 | ) | 17,280 | 27,761 | |||||||||||||||||||||||||||||||||
1582 First Avenue |
High Rise | Mar-05 | New York, NY | 1900 | 17 | 4,250 | 752 | 224 | 4,281 | 945 | 5,226 | (249 | ) | 4,977 | 2,671 | |||||||||||||||||||||||||||||||||
173 E. 90th Street |
High Rise | May-04 | New York, NY | 1910 | 72 | 11,773 | 4,535 | 1,445 | 12,067 | 5,686 | 17,753 | (1,365 | ) | 16,388 | 8,772 | |||||||||||||||||||||||||||||||||
182-188 Columbus Avenue |
Mid Rise | Feb-07 | New York, NY | 1910 | 32 | 17,187 | 3,300 | 3,690 | 19,123 | 5,054 | 24,177 | (992 | ) | 23,185 | 13,471 | |||||||||||||||||||||||||||||||||
204-206 West 133rd Street |
Mid Rise | Jun-07 | New York, NY | 1910 | 44 | 3,291 | 1,450 | 1,921 | 4,352 | 2,310 | 6,662 | (303 | ) | 6,359 | 3,132 | |||||||||||||||||||||||||||||||||
2232-2240 Seventh Avenue |
Mid Rise | Jun-07 | New York, NY | 1910 | 24 | 2,863 | 3,785 | 1,477 | 3,366 | 4,759 | 8,125 | (517 | ) | 7,608 | 2,972 | |||||||||||||||||||||||||||||||||
2247-2253 Seventh Avenue |
Mid Rise | Jun-07 | New York, NY | 1910 | 35 | 6,787 | 3,335 | 1,464 | 7,356 | 4,230 | 11,586 | (586 | ) | 11,000 | 5,483 | |||||||||||||||||||||||||||||||||
2252-2258 Seventh Avenue |
Mid Rise | Jun-07 | New York, NY | 1910 | 35 | 3,623 | 4,504 | 1,814 | 4,318 | 5,623 | 9,941 | (772 | ) | 9,169 | 5,125 | |||||||||||||||||||||||||||||||||
2300-2310 Seventh Avenue |
Mid Rise | Jun-07 | New York, NY | 1910 | 63 | 8,623 | 6,964 | 5,260 | 10,417 | 10,430 | 20,847 | (1,441 | ) | 19,406 | 9,896 | |||||||||||||||||||||||||||||||||
236 - 238 East 88th Street |
High Rise | Jan-04 | New York, NY | 1900 | 43 | 8,751 | 2,914 | 1,295 | 8,820 | 4,140 | 12,960 | (1,155 | ) | 11,805 | 6,879 | |||||||||||||||||||||||||||||||||
237-239 Ninth Avenue |
High Rise | Mar-05 | New York, NY | 1900 | 36 | 8,430 | 1,866 | 770 | 8,494 | 2,572 | 11,066 | (614 | ) | 10,452 | 5,227 | |||||||||||||||||||||||||||||||||
240 West 73rd Street, LLC |
High Rise | Sep-04 | New York, NY | 1900 | 200 | 68,006 | 12,140 | 3,563 | 68,109 | 15,600 | 83,709 | (2,827 | ) | 80,882 | 30,286 | |||||||||||||||||||||||||||||||||
2484 Seventh Avenue |
Mid Rise | Jun-07 | New York, NY | 1921 | 23 | 2,384 | 1,726 | 468 | 2,601 | 1,977 | 4,578 | (243 | ) | 4,335 | 2,472 | |||||||||||||||||||||||||||||||||
2900 on First Apartments |
Mid Rise | Oct-08 | Seattle, WA | 1989 | 135 | 19,015 | 17,518 | 330 | 19,071 | 17,792 | 36,863 | (860 | ) | 36,003 | 20,719 | |||||||||||||||||||||||||||||||||
306 East 89th Street |
High Rise | Jul-04 | New York, NY | 1930 | 20 | 2,659 | 1,006 | 167 | 2,681 | 1,151 | 3,832 | (350 | ) | 3,482 | 1,908 | |||||||||||||||||||||||||||||||||
311 & 313 East 73rd Street |
Mid Rise | Mar-03 | New York, NY | 1904 | 34 | 5,635 | 1,609 | 546 | 5,678 | 2,112 | 7,790 | (940 | ) | 6,850 | 2,761 | |||||||||||||||||||||||||||||||||
322-324 East 61st Street |
High Rise | Mar-05 | New York, NY | 1900 | 40 | 6,319 | 2,224 | 681 | 6,372 | 2,852 | 9,224 | (707 | ) | 8,517 | 3,691 | |||||||||||||||||||||||||||||||||
3400 Avenue of the Arts |
Mid Rise | Mar-02 | Costa Mesa, CA | 1987 | 770 | 55,223 | 65,506 | 73,301 | 57,240 | 136,790 | 194,030 | (31,750 | ) | 162,280 | 119,869 | |||||||||||||||||||||||||||||||||
452 East 78th Street |
High Rise | Jan-04 | New York, NY | 1900 | 12 | 1,966 | 608 | 278 | 1,982 | 870 | 2,852 | (242 | ) | 2,610 | 1,600 | |||||||||||||||||||||||||||||||||
464-466 Amsterdam & 200-210 W.
83rd Street |
Mid Rise | Feb-07 | New York, NY | 1910 | 72 | 23,677 | 7,101 | 3,881 | 25,552 | 9,107 | 34,659 | (1,241 | ) | 33,418 | 19,679 | |||||||||||||||||||||||||||||||||
510 East 88th Street |
High Rise | Jan-04 | New York, NY | 1900 | 20 | 3,137 | 1,002 | 278 | 3,163 | 1,254 | 4,417 | (307 | ) | 4,110 | 2,634 | |||||||||||||||||||||||||||||||||
514-516 East 88th Street |
High Rise | Mar-05 | New York, NY | 1900 | 36 | 6,230 | 2,168 | 556 | 6,282 | 2,672 | 8,954 | (618 | ) | 8,336 | 4,607 | |||||||||||||||||||||||||||||||||
656 St. Nicholas Avenue |
Mid Rise | Jun-07 | New York, NY | 1920 | 31 | 2,731 | 1,636 | 2,774 | 3,576 | 3,565 | 7,141 | (467 | ) | 6,674 | 2,374 | |||||||||||||||||||||||||||||||||
759 St. Nicholas Avenue |
Mid Rise | Oct-07 | New York, NY | 1920 | 9 | 682 | 535 | 587 | 1,013 | 791 | 1,804 | (84 | ) | 1,720 | 545 | |||||||||||||||||||||||||||||||||
865 Bellevue |
Garden | Jul-00 | Nashville, TN | 1972 | 326 | 3,558 | 12,037 | 27,055 | 3,558 | 39,092 | 42,650 | (11,840 | ) | 30,810 | 19,184 | |||||||||||||||||||||||||||||||||
Arbors (Grovetree), The |
Garden | Oct-97 | Tempe, AZ | 1967 | 200 | 1,092 | 6,208 | 2,940 | 1,092 | 9,148 | 10,240 | (4,038 | ) | 6,202 | 6,743 | |||||||||||||||||||||||||||||||||
Arbours Of Hermitage, The |
Garden | Jul-00 | Hermitage, TN | 1972 | 350 | 3,217 | 12,023 | 6,795 | 3,217 | 18,818 | 22,035 | (8,527 | ) | 13,508 | 10,258 | |||||||||||||||||||||||||||||||||
Auburn Glen |
Garden | Dec-06 | Jacksonville, FL | 1974 | 251 | 7,483 | 8,191 | 3,202 | 7,670 | 11,206 | 18,876 | (2,098 | ) | 16,778 | 9,912 | |||||||||||||||||||||||||||||||||
BaLaye |
Garden | Apr-06 | Tampa, FL | 2002 | 324 | 10,329 | 28,800 | 969 | 10,608 | 29,490 | 40,098 | (4,187 | ) | 35,911 | 23,012 | |||||||||||||||||||||||||||||||||
Bank Lofts |
High Rise | Apr-01 | Denver, CO | 1920 | 117 | 3,525 | 9,045 | 1,668 | 3,525 | 10,713 | 14,238 | (4,668 | ) | 9,570 | 7,242 | |||||||||||||||||||||||||||||||||
Bay Parc Plaza |
High Rise | Sep-04 | Miami, FL | 2000 | 471 | 22,680 | 41,847 | 4,097 | 22,680 | 45,944 | 68,624 | (6,612 | ) | 62,012 | 46,294 | |||||||||||||||||||||||||||||||||
Bay Ridge at Nashua |
Garden | Jan-03 | Nashua, NH | 1984 | 412 | 3,352 | 40,713 | 6,895 | 3,262 | 47,698 | 50,960 | (10,541 | ) | 40,419 | 40,766 | |||||||||||||||||||||||||||||||||
Bayberry Hill Estates |
Garden | Aug-02 | Framingham, MA | 1971 | 424 | 18,915 | 35,945 | 8,744 | 18,916 | 44,688 | 63,604 | (14,036 | ) | 49,568 | 35,250 | |||||||||||||||||||||||||||||||||
Bayhead Village |
Garden | Oct-00 | Indianapolis, IN | 1978 | 202 | 1,411 | 5,139 | 3,482 | 1,411 | 8,621 | 10,032 | (3,400 | ) | 6,632 | 2,728 | |||||||||||||||||||||||||||||||||
Boston Lofts |
High Rise | Apr-01 | Denver, CO | 1890 | 158 | 3,447 | 20,589 | 3,188 | 3,447 | 23,777 | 27,224 | (9,855 | ) | 17,369 | 14,559 | |||||||||||||||||||||||||||||||||
Boulder Creek |
Garden | Jul-94 | Boulder, CO | 1972 | 221 | 755 | 7,730 | 17,156 | 755 | 24,886 | 25,641 | (11,913 | ) | 13,728 | 12,031 | |||||||||||||||||||||||||||||||||
Brandywine |
Garden | Jul-94 | St. Petersburg, FL | 1971 | 477 | 1,437 | 12,725 | 8,763 | 1,437 | 21,488 | 22,925 | (13,782 | ) | 9,143 | 21,124 | |||||||||||||||||||||||||||||||||
Breakers, The |
Garden | Oct-98 | Daytona Beach, FL | 1985 | 208 | 1,008 | 5,507 | 3,257 | 1,008 | 8,764 | 9,772 | (3,856 | ) | 5,916 | 6,378 | |||||||||||||||||||||||||||||||||
Broadcast Center |
Garden | Mar-02 | Los Angeles, CA | 1990 | 279 | 27,603 | 41,244 | 29,066 | 29,407 | 68,506 | 97,913 | (15,963 | ) | 81,950 | 55,875 | |||||||||||||||||||||||||||||||||
Buena Vista |
Mid Rise | Jan-06 | Pasadena, CA | 1973 | 92 | 9,693 | 6,818 | 1,126 | 9,693 | 7,944 | 17,637 | (768 | ) | 16,869 | 10,607 | |||||||||||||||||||||||||||||||||
Burke Shire Commons |
Garden | Mar-01 | Burke, VA | 1986 | 360 | 4,867 | 23,617 | 3,860 | 4,867 | 27,477 | 32,344 | (10,304 | ) | 22,040 | 46,100 | |||||||||||||||||||||||||||||||||
Calhoun Beach Club |
High Rise | Dec-98 | Minneapolis, MN | 1928 | 332 | 11,708 | 73,334 | 45,743 | 11,708 | 119,077 | 130,785 | (40,408 | ) | 90,377 | 49,119 | |||||||||||||||||||||||||||||||||
Canterbury Green |
Garden | Dec-99 | Fort Wayne, IN | 1979 | 1,988 | 13,659 | 73,115 | 25,704 | 13,659 | 98,819 | 112,478 | (45,994 | ) | 66,484 | 53,200 | |||||||||||||||||||||||||||||||||
Canyon Terrace |
Garden | Mar-02 | Saugus, CA | 1984 | 130 | 7,300 | 6,602 | 5,909 | 7,508 | 12,303 | 19,811 | (3,593 | ) | 16,218 | 11,750 | |||||||||||||||||||||||||||||||||
Carriage Hill |
Garden | Jul-00 | East Lansing, MI | 1972 | 143 | 1,957 | 7,912 | 2,053 | 1,957 | 9,965 | 11,922 | (5,434 | ) | 6,488 | 5,360 | |||||||||||||||||||||||||||||||||
Casa del Mar at Baymeadows |
Garden | Oct-06 | Jacksonville, FL | 1984 | 144 | 4,902 | 10,562 | 1,403 | 5,039 | 11,828 | 16,867 | (1,752 | ) | 15,115 | 9,434 | |||||||||||||||||||||||||||||||||
Cedar Rim |
Garden | Apr-00 | Newcastle, WA | 1980 | 104 | 761 | 5,218 | 17,174 | 761 | 22,392 | 23,153 | (9,405 | ) | 13,748 | 7,857 | |||||||||||||||||||||||||||||||||
Center Square |
High Rise | Oct-99 | Doylestown, PA | 1975 | 350 | 582 | 4,190 | 3,532 | 582 | 7,722 | 8,304 | (3,104 | ) | 5,200 | 15,159 | |||||||||||||||||||||||||||||||||
Charleston Landing |
Garden | Sep-00 | Brandon, FL | 1985 | 300 | 7,488 | 8,656 | 7,711 | 7,488 | 16,367 | 23,855 | (5,745 | ) | 18,110 | 13,101 | |||||||||||||||||||||||||||||||||
Chesapeake Landing I |
Garden | Sep-00 | Aurora, IL | 1986 | 416 | 15,800 | 16,875 | 4,931 | 15,800 | 21,806 | 37,606 | (7,748 | ) | 29,858 | 24,630 | |||||||||||||||||||||||||||||||||
Chesapeake Landing II |
Garden | Mar-01 | Aurora, IL | 1987 | 184 | 1,969 | 7,980 | 3,308 | 1,969 | 11,288 | 13,257 | (4,730 | ) | 8,527 | 10,241 | |||||||||||||||||||||||||||||||||
Chestnut Hall |
High Rise | Oct-06 | Philadelphia, PA | 1923 | 315 | 12,047 | 14,299 | 4,653 | 12,338 | 18,661 | 30,999 | (3,996 | ) | 27,003 | 18,690 | |||||||||||||||||||||||||||||||||
Chestnut Hill |
Garden | Apr-00 | Philadelphia, PA | 1963 | 821 | 6,463 | 49,315 | 48,996 | 6,463 | 98,311 | 104,774 | (36,814 | ) | 67,960 | 51,444 | |||||||||||||||||||||||||||||||||
Chimneys of Cradle Rock |
Garden | Jun-04 | Columbia, MD | 1979 | 198 | 2,234 | 8,107 | 578 | 2,040 | 8,879 | 10,919 | (2,284 | ) | 8,635 | 16,737 | |||||||||||||||||||||||||||||||||
Colonnade Gardens |
Garden | Oct-97 | Phoenix, AZ | 1973 | 196 | 766 | 4,346 | 2,912 | 766 | 7,258 | 8,024 | (3,615 | ) | 4,409 | 1,625 | |||||||||||||||||||||||||||||||||
Colony at Kenilworth |
Garden | Oct-99 | Towson, MD | 1966 | 383 | 2,403 | 18,798 | 10,801 | 2,403 | 29,599 | 32,002 | (14,784 | ) | 17,218 | 24,443 | |||||||||||||||||||||||||||||||||
Columbus Avenue |
Mid Rise | Sep-03 | New York, NY | 1880 | 59 | 35,472 | 9,450 | 3,599 | 35,527 | 12,994 | 48,521 | (4,970 | ) | 43,551 | 25,826 | |||||||||||||||||||||||||||||||||
Country Lakes I |
Garden | Apr-01 | Naperville, IL | 1982 | 240 | 8,512 | 10,832 | 3,300 | 8,512 | 14,132 | 22,644 | (5,213 | ) | 17,431 | 14,557 | |||||||||||||||||||||||||||||||||
Country Lakes II |
Garden | May-97 | Naperville, IL | 1986 | 400 | 5,165 | 29,430 | 5,921 | 5,165 | 35,351 | 40,516 | (14,200 | ) | 26,316 | 24,893 |
72
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(1) | Initial Cost | Cost Capitalized | December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Property | Date | Year | Number | Buildings and | Subsequent to | Buildings and | (5) | Accumulated | Total Cost | |||||||||||||||||||||||||||||||||||||||
Property Name | Type | Consolidated | Location | Built | of Units | Land | Improvements | Consolidation | Land | Improvements | Total | Depreciation (AD) | Net of AD | Encumbrances | ||||||||||||||||||||||||||||||||||
Creekside |
Garden | Jan-00 | Denver, CO | 1974 | 328 | 2,953 | 12,697 | 5,028 | 3,189 | 17,489 | 20,678 | (7,788 | ) | 12,890 | 14,359 | |||||||||||||||||||||||||||||||||
Creekside |
Garden | Mar-02 | Simi Valley, CA | 1985 | 397 | 24,595 | 18,818 | 6,775 | 25,245 | 24,943 | 50,188 | (8,109 | ) | 42,079 | 40,670 | |||||||||||||||||||||||||||||||||
Crescent at West Hollywood, The |
Mid Rise | Mar-02 | West Hollywood, CA | 1982 | 130 | 15,382 | 10,215 | 14,817 | 15,765 | 24,649 | 40,414 | (9,223 | ) | 31,191 | 24,195 | |||||||||||||||||||||||||||||||||
Douglaston Villas and Townhomes |
Garden | Aug-99 | Altamonte Springs, FL | 1979 | 234 | 1,666 | 9,353 | 7,460 | 1,666 | 16,813 | 18,479 | (6,381 | ) | 12,098 | 10,512 | |||||||||||||||||||||||||||||||||
Elm Creek |
Mid Rise | Dec-97 | Elmhurst, IL | 1986 | 372 | 5,534 | 30,830 | 17,422 | 5,635 | 48,151 | 53,786 | (18,347 | ) | 35,439 | 35,154 | |||||||||||||||||||||||||||||||||
Evanston Place |
High Rise | Dec-97 | Evanston, IL | 1988 | 189 | 3,232 | 25,546 | 4,398 | 3,232 | 29,944 | 33,176 | (10,325 | ) | 22,851 | 21,645 | |||||||||||||||||||||||||||||||||
Fairlane East |
Garden | Jan-01 | Dearborn, MI | 1973 | 244 | 6,550 | 11,711 | 5,136 | 6,550 | 16,847 | 23,397 | (8,610 | ) | 14,787 | 10,200 | |||||||||||||||||||||||||||||||||
Farmingdale |
Mid Rise | Oct-00 | Darien, IL | 1975 | 240 | 11,763 | 15,174 | 9,177 | 11,763 | 24,351 | 36,114 | (9,406 | ) | 26,708 | 17,732 | |||||||||||||||||||||||||||||||||
Ferntree |
Garden | Mar-01 | Phoenix, AZ | 1968 | 219 | 2,078 | 13,752 | 3,195 | 2,079 | 16,946 | 19,025 | (6,327 | ) | 12,698 | 7,058 | |||||||||||||||||||||||||||||||||
Fishermans Village |
Garden | Jan-06 | Indianapolis, IN | 1982 | 328 | 2,156 | 9,936 | 2,685 | 2,156 | 12,621 | 14,777 | (7,059 | ) | 7,718 | 6,350 | |||||||||||||||||||||||||||||||||
Fishermans Wharf |
Garden | Nov-96 | Clute, TX | 1981 | 360 | 1,257 | 7,584 | 5,428 | 1,257 | 13,012 | 14,269 | (5,704 | ) | 8,565 | 6,930 | |||||||||||||||||||||||||||||||||
Flamingo Towers |
High Rise | Sep-97 | Miami Beach, FL | 1960 | 1,127 | 32,191 | 38,399 | 217,720 | 32,239 | 256,071 | 288,310 | (91,197 | ) | 197,113 | 118,890 | |||||||||||||||||||||||||||||||||
Forestlake Apartments |
Garden | Mar-07 | Daytona Beach, FL | 1982 | 120 | 3,691 | 4,320 | 496 | 3,860 | 4,647 | 8,507 | (623 | ) | 7,884 | 4,735 | |||||||||||||||||||||||||||||||||
Four Quarters Habitat |
Garden | Jan-06 | Miami, FL | 1976 | 336 | 2,383 | 17,199 | 14,503 | 2,379 | 31,706 | 34,085 | (11,365 | ) | 22,720 | 11,698 | |||||||||||||||||||||||||||||||||
Foxchase |
Garden | Dec-97 | Alexandria, VA | 1947 | 2,113 | 15,419 | 96,062 | 31,800 | 15,496 | 127,785 | 143,281 | (55,566 | ) | 87,715 | 184,131 | |||||||||||||||||||||||||||||||||
Georgetown |
Garden | Aug-02 | Framingham, MA | 1964 | 207 | 12,351 | 13,168 | 2,091 | 12,351 | 15,259 | 27,610 | (4,535 | ) | 23,075 | 12,775 | |||||||||||||||||||||||||||||||||
Glen at Forestlake, The |
Garden | Mar-07 | Daytona Beach, FL | 1982 | 26 | 897 | 862 | 182 | 933 | 1,008 | 1,941 | (125 | ) | 1,816 | 1,039 | |||||||||||||||||||||||||||||||||
Granada |
Mid Rise | Aug-02 | Framingham, MA | 1958 | 72 | 4,577 | 4,058 | 854 | 4,577 | 4,912 | 9,489 | (2,043 | ) | 7,446 | 4,275 | |||||||||||||||||||||||||||||||||
Grand Pointe |
Garden | Dec-99 | Columbia, MD | 1974 | 325 | 2,715 | 16,771 | 5,264 | 2,715 | 22,035 | 24,750 | (8,144 | ) | 16,606 | 16,987 | |||||||||||||||||||||||||||||||||
Greens |
Garden | Jul-94 | Chandler, AZ | 2000 | 324 | 2,303 | 713 | 27,244 | 2,303 | 27,957 | 30,260 | (12,346 | ) | 17,914 | 12,855 | |||||||||||||||||||||||||||||||||
Greenspoint at Paradise Valley |
Garden | Jan-00 | Phoenix, AZ | 1985 | 336 | 3,042 | 13,223 | 12,350 | 3,042 | 25,573 | 28,615 | (11,541 | ) | 17,074 | 16,287 | |||||||||||||||||||||||||||||||||
Hampden Heights |
Garden | Jan-00 | Denver, CO | 1973 | 376 | 3,224 | 12,905 | 5,893 | 3,453 | 18,569 | 22,022 | (8,681 | ) | 13,341 | 13,830 | |||||||||||||||||||||||||||||||||
Harbour, The |
Garden | Mar-01 | Melbourne, FL | 1987 | 162 | 4,108 | 3,563 | 5,774 | 4,108 | 9,337 | 13,445 | (3,026 | ) | 10,419 | | |||||||||||||||||||||||||||||||||
Heritage Park at Alta Loma |
Garden | Jan-01 | Alta Loma, CA | 1986 | 232 | 1,200 | 6,428 | 3,456 | 1,200 | 9,884 | 11,084 | (3,560 | ) | 7,524 | 7,264 | |||||||||||||||||||||||||||||||||
Heritage Park Escondido |
Garden | Oct-00 | Escondido, CA | 1986 | 196 | 1,055 | 7,565 | 1,325 | 1,055 | 8,890 | 9,945 | (4,118 | ) | 5,827 | 7,299 | |||||||||||||||||||||||||||||||||
Heritage Park Livermore |
Garden | Oct-00 | Livermore, CA | 1988 | 167 | 1,039 | 9,170 | 1,343 | 1,039 | 10,513 | 11,552 | (4,639 | ) | 6,913 | 7,432 | |||||||||||||||||||||||||||||||||
Heritage Park Montclair |
Garden | Mar-01 | Montclair, CA | 1985 | 144 | 690 | 4,149 | 1,206 | 690 | 5,355 | 6,045 | (1,873 | ) | 4,172 | 4,620 | |||||||||||||||||||||||||||||||||
Heritage Village Anaheim |
Garden | Oct-00 | Anaheim, CA | 1986 | 196 | 1,832 | 8,541 | 1,609 | 1,832 | 10,150 | 11,982 | (4,777 | ) | 7,205 | 8,858 | |||||||||||||||||||||||||||||||||
Hidden Cove |
Garden | Jul-98 | Escondido, CA | 1985 | 334 | 3,043 | 17,615 | 6,980 | 3,043 | 24,595 | 27,638 | (10,158 | ) | 17,480 | 31,006 | |||||||||||||||||||||||||||||||||
Hidden Cove II |
Garden | Jul-07 | Escondido, CA | 1986 | 118 | 12,730 | 6,530 | 5,473 | 12,849 | 11,884 | 24,733 | (1,806 | ) | 22,927 | 11,586 | |||||||||||||||||||||||||||||||||
Hidden Harbour |
Garden | Oct-02 | Melbourne, FL | 1985 | 216 | 1,444 | 7,590 | 4,798 | 1,444 | 12,388 | 13,832 | (3,471 | ) | 10,361 | | |||||||||||||||||||||||||||||||||
Highcrest Townhomes |
Town Home | Jan-03 | Woodridge, IL | 1968 | 176 | 3,045 | 13,452 | 1,368 | 3,045 | 14,820 | 17,865 | (6,091 | ) | 11,774 | 10,876 | |||||||||||||||||||||||||||||||||
Hillcreste |
Garden | Mar-02 | Century City, CA | 1989 | 315 | 33,755 | 47,216 | 25,906 | 35,862 | 71,015 | 106,877 | (21,022 | ) | 85,855 | 57,610 | |||||||||||||||||||||||||||||||||
Hillmeade |
Garden | Nov-94 | Nashville, TN | 1985 | 288 | 2,872 | 16,069 | 13,564 | 2,872 | 29,633 | 32,505 | (16,923 | ) | 15,582 | 18,376 | |||||||||||||||||||||||||||||||||
Horizons West Apartments |
Mid Rise | Dec-06 | Pacifica, CA | 1970 | 78 | 8,763 | 6,376 | 1,610 | 8,887 | 7,862 | 16,749 | (1,059 | ) | 15,690 | 5,377 | |||||||||||||||||||||||||||||||||
Hunt Club |
Garden | Sep-00 | Gaithersburg, MD | 1986 | 336 | 17,859 | 13,149 | 3,598 | 17,859 | 16,747 | 34,606 | (6,372 | ) | 28,234 | 32,160 | |||||||||||||||||||||||||||||||||
Hunt Club |
Garden | Mar-01 | Austin, TX | 1987 | 384 | 10,342 | 11,920 | 8,537 | 10,342 | 20,457 | 30,799 | (9,758 | ) | 21,041 | 16,499 | |||||||||||||||||||||||||||||||||
Hunters Chase |
Garden | Jan-01 | Midlothian, VA | 1985 | 320 | 7,935 | 7,915 | 3,259 | 7,935 | 11,174 | 19,109 | (3,398 | ) | 15,711 | 16,407 | |||||||||||||||||||||||||||||||||
Hunters Crossing |
Garden | Apr-01 | Leesburg, VA | 1967 | 164 | 2,244 | 7,763 | 4,079 | 2,244 | 11,842 | 14,086 | (6,371 | ) | 7,715 | 6,940 | |||||||||||||||||||||||||||||||||
Hunters Glen IV |
Garden | Oct-99 | Plainsboro, NJ | 1976 | 264 | 2,709 | 14,420 | 4,819 | 2,709 | 19,239 | 21,948 | (9,525 | ) | 12,423 | 20,191 | |||||||||||||||||||||||||||||||||
Hunters Glen V |
Garden | Oct-99 | Plainsboro, NJ | 1977 | 304 | 3,283 | 17,337 | 5,211 | 3,283 | 22,548 | 25,831 | (11,087 | ) | 14,744 | 24,194 | |||||||||||||||||||||||||||||||||
Hunters Glen VI |
Garden | Oct-99 | Plainsboro, NJ | 1977 | 328 | 2,787 | 15,501 | 6,075 | 2,787 | 21,576 | 24,363 | (11,389 | ) | 12,974 | 25,182 | |||||||||||||||||||||||||||||||||
Hyde Park Tower |
High Rise | Oct-04 | Chicago, IL | 1990 | 155 | 4,683 | 14,928 | 1,931 | 4,731 | 16,811 | 21,542 | (2,913 | ) | 18,629 | 13,781 | |||||||||||||||||||||||||||||||||
Independence Green |
Garden | Jan-06 | Farmington Hills, MI | 1960 | 981 | 10,293 | 24,586 | 20,189 | 10,156 | 44,912 | 55,068 | (13,065 | ) | 42,003 | 27,758 | |||||||||||||||||||||||||||||||||
Indian Oaks |
Garden | Mar-02 | Simi Valley, CA | 1986 | 254 | 23,927 | 15,801 | 3,489 | 24,523 | 18,694 | 43,217 | (5,884 | ) | 37,333 | 33,171 | |||||||||||||||||||||||||||||||||
Island Club |
Garden | Oct-00 | Oceanside, CA | 1986 | 592 | 18,027 | 28,654 | 11,220 | 18,027 | 39,874 | 57,901 | (15,731 | ) | 42,170 | 64,973 | |||||||||||||||||||||||||||||||||
Island Club (Beville) |
Garden | Oct-00 | Daytona Beach, FL | 1986 | 204 | 6,086 | 8,571 | 2,135 | 6,087 | 10,705 | 16,792 | (4,444 | ) | 12,348 | 8,440 | |||||||||||||||||||||||||||||||||
Key Towers |
High Rise | Apr-01 | Alexandria, VA | 1964 | 140 | 1,526 | 7,050 | 3,849 | 1,526 | 10,899 | 12,425 | (4,859 | ) | 7,566 | 10,868 | |||||||||||||||||||||||||||||||||
Lakeside |
Garden | Oct-99 | Lisle, IL | 1972 | 568 | 5,840 | 27,937 | 28,127 | 5,840 | 56,064 | 61,904 | (22,153 | ) | 39,751 | 29,375 | |||||||||||||||||||||||||||||||||
Lakeside at Vinings Mountain |
Garden | Jan-00 | Atlanta, GA | 1983 | 220 | 2,109 | 11,863 | 15,149 | 2,109 | 27,012 | 29,121 | (10,884 | ) | 18,237 | 9,666 | |||||||||||||||||||||||||||||||||
Lakeside Place |
Garden | Oct-99 | Houston, TX | 1976 | 734 | 6,160 | 34,151 | 15,942 | 6,160 | 50,093 | 56,253 | (21,654 | ) | 34,599 | 26,955 | |||||||||||||||||||||||||||||||||
Lamplighter Park |
Garden | Apr-00 | Bellevue, WA | 1967 | 174 | 2,225 | 9,272 | 4,150 | 2,225 | 13,422 | 15,647 | (6,442 | ) | 9,205 | 10,576 | |||||||||||||||||||||||||||||||||
Latrobe |
High Rise | Jan-03 | Washington, DC | 1980 | 175 | 3,459 | 9,103 | 15,543 | 3,459 | 24,646 | 28,105 | (10,353 | ) | 17,752 | 22,192 | |||||||||||||||||||||||||||||||||
Lazy Hollow |
Garden | Apr-05 | Columbia, MD | 1979 | 178 | 2,424 | 12,181 | 956 | 2,424 | 13,137 | 15,561 | (5,520 | ) | 10,041 | 7,867 | |||||||||||||||||||||||||||||||||
Leahy Square |
Garden | Apr-07 | Redwood City, CA | 1973 | 110 | 15,352 | 7,909 | 1,755 | 15,444 | 9,572 | 25,016 | (1,631 | ) | 23,385 | 15,185 | |||||||||||||||||||||||||||||||||
Lewis Park |
Garden | Jan-06 | Carbondale, IL | 1972 | 269 | 1,407 | 12,193 | 3,183 | 1,404 | 15,379 | 16,783 | (8,520 | ) | 8,263 | 3,981 | |||||||||||||||||||||||||||||||||
Lincoln Place Garden |
Garden | Oct-04 | Venice, CA | 1951 | 692 | 43,979 | 10,439 | 86,174 | 42,894 | 97,698 | 140,592 | (1,691 | ) | 138,901 | 65,000 | |||||||||||||||||||||||||||||||||
Lodge at Chattahoochee, The |
Garden | Oct-99 | Sandy Springs, GA | 1970 | 312 | 2,320 | 16,370 | 21,615 | 2,320 | 37,985 | 40,305 | (15,095 | ) | 25,210 | 11,087 | |||||||||||||||||||||||||||||||||
Los Arboles |
Garden | Sep-97 | Chandler, AZ | 1985 | 232 | 1,662 | 9,504 | 3,197 | 1,662 | 12,701 | 14,363 | (5,741 | ) | 8,622 | 8,086 | |||||||||||||||||||||||||||||||||
Malibu Canyon |
Garden | Mar-02 | Calabasas, CA | 1986 | 698 | 66,257 | 53,438 | 34,982 | 69,834 | 84,843 | 154,677 | (30,295 | ) | 124,382 | 97,604 | |||||||||||||||||||||||||||||||||
Maple Bay |
Garden | Dec-99 | Virginia Beach, VA | 1971 | 414 | 2,598 | 16,141 | 29,935 | 2,598 | 46,076 | 48,674 | (15,809 | ) | 32,865 | 33,548 | |||||||||||||||||||||||||||||||||
Mariners Cove |
Garden | Mar-02 | San Diego, CA | 1984 | 500 | | 66,861 | 7,271 | | 74,132 | 74,132 | (18,728 | ) | 55,404 | 5,813 | |||||||||||||||||||||||||||||||||
Meadow Creek |
Garden | Jul-94 | Boulder, CO | 1972 | 332 | 1,435 | 24,532 | 6,358 | 1,435 | 30,890 | 32,325 | (13,197 | ) | 19,128 | 24,071 | |||||||||||||||||||||||||||||||||
Merrill House |
High Rise | Jan-00 | Falls Church, VA | 1962 | 159 | 1,836 | 10,831 | 5,863 | 1,836 | 16,694 | 18,530 | (4,452 | ) | 14,078 | 15,600 | |||||||||||||||||||||||||||||||||
Mesa Royale |
Garden | Jul-94 | Mesa, AZ | 1985 | 152 | 832 | 4,569 | 9,585 | 832 | 14,154 | 14,986 | (5,290 | ) | 9,696 | | |||||||||||||||||||||||||||||||||
Montecito |
Garden | Jul-94 | Austin, TX | 1985 | 268 | 1,268 | 6,896 | 4,958 | 1,267 | 11,855 | 13,122 | (6,165 | ) | 6,957 | 996 | |||||||||||||||||||||||||||||||||
Monterey Grove |
Garden | Jun-08 | San Jose, CA | 1999 | 224 | 34,175 | 21,939 | 2,072 | 34,325 | 23,861 | 58,186 | (1,806 | ) | 56,380 | 35,000 |
73
(2) | (3) | |||||||||||||||||||||||||||||||||||||||||||||||
(1) | Initial Cost | Cost Capitalized | December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Property | Date | Year | Number | Buildings and | Subsequent to | Buildings and | (5) | Accumulated | Total Cost | |||||||||||||||||||||||||||||||||||||||
Property Name | Type | Consolidated | Location | Built | of Units | Land | Improvements | Consolidation | Land | Improvements | Total | Depreciation (AD) | Net of AD | Encumbrances | ||||||||||||||||||||||||||||||||||
Oak Park Village |
Garden | Oct-00 | Lansing, MI | 1973 | 618 | 10,048 | 16,771 | 7,340 | 10,048 | 24,111 | 34,159 | (12,777 | ) | 21,382 | 23,487 | |||||||||||||||||||||||||||||||||
Ocean Oaks |
Garden | May-98 | Port Orange, FL | 1988 | 296 | 2,132 | 12,855 | 3,242 | 2,132 | 16,097 | 18,229 | (6,492 | ) | 11,737 | 10,295 | |||||||||||||||||||||||||||||||||
One Lytle Place |
High Rise | Jan-00 | Cincinnati ,OH | 1980 | 231 | 2,662 | 21,800 | 12,551 | 2,662 | 34,351 | 37,013 | (12,139 | ) | 24,874 | 15,450 | |||||||||||||||||||||||||||||||||
Pacific Bay Vistas |
Garden | Mar-01 | San Bruno, CA | 1987 | 308 | 3,703 | 62,460 | 22,184 | 22,994 | 65,353 | 88,347 | (55,442 | ) | 32,905 | | |||||||||||||||||||||||||||||||||
Pacifica Park |
Garden | Jul-06 | Pacifica, CA | 1977 | 104 | 12,770 | 6,579 | 3,183 | 12,970 | 9,562 | 22,532 | (2,205 | ) | 20,327 | 11,260 | |||||||||||||||||||||||||||||||||
Palazzo at Park La Brea, The |
Mid Rise | Feb-04 | Los Angeles, CA | 2002 | 521 | 47,822 | 125,464 | 8,804 | 48,362 | 133,728 | 182,090 | (30,135 | ) | 151,955 | 125,554 | |||||||||||||||||||||||||||||||||
Palazzo East at Park La Brea, The |
Mid Rise | Mar-05 | Los Angeles, CA | 2005 | 611 | 61,004 | 136,503 | 22,142 | 72,578 | 147,071 | 219,649 | (26,968 | ) | 192,681 | 150,000 | |||||||||||||||||||||||||||||||||
Paradise Palms |
Garden | Jul-94 | Phoenix, AZ | 1985 | 129 | 647 | 3,515 | 6,959 | 647 | 10,474 | 11,121 | (5,539 | ) | 5,582 | 6,400 | |||||||||||||||||||||||||||||||||
Park at Cedar Lawn, The |
Garden | Nov-96 | Galveston, TX | 1985 | 192 | 1,025 | 2,521 | 3,585 | 1,025 | 6,106 | 7,131 | (2,539 | ) | 4,592 | | |||||||||||||||||||||||||||||||||
Park Towne Place |
High Rise | Apr-00 | Philadelphia, PA | 1959 | 959 | 10,451 | 47,301 | 54,589 | 10,451 | 101,890 | 112,341 | (23,850 | ) | 88,491 | 86,343 | |||||||||||||||||||||||||||||||||
Parktown Townhouses |
Garden | Oct-99 | Deer Park, TX | 1968 | 309 | 2,570 | 12,052 | 9,410 | 2,570 | 21,462 | 24,032 | (8,186 | ) | 15,846 | 5,618 | |||||||||||||||||||||||||||||||||
Parkway |
Garden | Mar-00 | Willamsburg, VA | 1971 | 148 | 386 | 2,834 | 2,754 | 386 | 5,588 | 5,974 | (3,284 | ) | 2,690 | 9,273 | |||||||||||||||||||||||||||||||||
Pathfinder Village |
Garden | Jan-06 | Fremont, CA | 1973 | 246 | 19,595 | 14,838 | 8,147 | 19,595 | 22,985 | 42,580 | (3,163 | ) | 39,417 | 19,348 | |||||||||||||||||||||||||||||||||
Peachtree Park |
Garden | Jan-96 | Atlanta, GA | 1962 | 303 | 4,683 | 11,713 | 9,900 | 4,683 | 21,613 | 26,296 | (9,890 | ) | 16,406 | 9,543 | |||||||||||||||||||||||||||||||||
Peak at Vinings Mountain, The |
Garden | Jan-00 | Atlanta, GA | 1980 | 280 | 2,651 | 13,660 | 17,606 | 2,651 | 31,266 | 33,917 | (12,410 | ) | 21,507 | 10,412 | |||||||||||||||||||||||||||||||||
Peakview Place |
Garden | Jan-00 | Englewood, CO | 1975 | 296 | 3,440 | 18,734 | 4,547 | 3,440 | 23,281 | 26,721 | (15,330 | ) | 11,391 | 12,711 | |||||||||||||||||||||||||||||||||
Pebble Point |
Garden | Oct-02 | Indianapolis, IN | 1980 | 220 | 1,790 | 6,883 | 2,612 | 1,790 | 9,495 | 11,285 | (4,526 | ) | 6,759 | 5,430 | |||||||||||||||||||||||||||||||||
Peppertree |
Garden | Mar-02 | Cypress, CA | 1971 | 136 | 7,835 | 5,224 | 2,778 | 8,030 | 7,807 | 15,837 | (2,743 | ) | 13,094 | 15,750 | |||||||||||||||||||||||||||||||||
Pine Lake Terrace |
Garden | Mar-02 | Garden Grove, CA | 1971 | 111 | 3,975 | 6,035 | 2,094 | 4,125 | 7,979 | 12,104 | (2,531 | ) | 9,573 | 12,000 | |||||||||||||||||||||||||||||||||
Pine Shadows |
Garden | May-98 | Tempe, AZ | 1983 | 272 | 2,095 | 11,899 | 3,725 | 2,095 | 15,624 | 17,719 | (7,375 | ) | 10,344 | 7,500 | |||||||||||||||||||||||||||||||||
Pines, The |
Garden | Oct-98 | Palm Bay, FL | 1984 | 216 | 603 | 3,318 | 2,716 | 603 | 6,034 | 6,637 | (2,415 | ) | 4,222 | 1,937 | |||||||||||||||||||||||||||||||||
Plantation Gardens |
Garden | Oct-99 | Plantation ,FL | 1971 | 372 | 3,773 | 19,443 | 6,204 | 3,773 | 25,647 | 29,420 | (10,871 | ) | 18,549 | 24,141 | |||||||||||||||||||||||||||||||||
Post Ridge |
Garden | Jul-00 | Nashville, TN | 1972 | 150 | 1,883 | 6,712 | 3,517 | 1,883 | 10,229 | 12,112 | (4,456 | ) | 7,656 | 6,042 | |||||||||||||||||||||||||||||||||
Ramblewood |
Garden | Dec-99 | Wyoming, MI | 1973 | 1,708 | 8,607 | 61,082 | 1,930 | 8,661 | 62,958 | 71,619 | (12,161 | ) | 59,458 | 34,944 | |||||||||||||||||||||||||||||||||
Ravensworth Towers |
High Rise | Jun-04 | Annandale, VA | 1974 | 219 | 3,455 | 17,157 | 2,272 | 3,455 | 19,429 | 22,884 | (9,501 | ) | 13,383 | 20,685 | |||||||||||||||||||||||||||||||||
Reflections |
Garden | Sep-00 | Virginia Beach, VA | 1987 | 480 | 15,988 | 13,684 | 5,255 | 15,988 | 18,939 | 34,927 | (7,638 | ) | 27,289 | 39,451 | |||||||||||||||||||||||||||||||||
Reflections |
Garden | Oct-00 | West Palm Beach, FL | 1986 | 300 | 5,504 | 9,984 | 4,113 | 5,504 | 14,097 | 19,601 | (5,272 | ) | 14,329 | 9,190 | |||||||||||||||||||||||||||||||||
Reflections |
Garden | Oct-02 | Casselberry, FL | 1984 | 336 | 3,906 | 10,491 | 4,233 | 3,906 | 14,724 | 18,630 | (4,662 | ) | 13,968 | 10,700 | |||||||||||||||||||||||||||||||||
Regency Oaks |
Garden | Oct-99 | Fern Park, FL | 1965 | 343 | 1,832 | 9,905 | 8,398 | 1,832 | 18,303 | 20,135 | (10,017 | ) | 10,118 | 11,134 | |||||||||||||||||||||||||||||||||
Remington at Ponte Vedra Lakes |
Garden | Dec-06 | Ponte Vedra Beach, FL | 1986 | 344 | 18,576 | 18,650 | 2,242 | 18,795 | 20,673 | 39,468 | (3,586 | ) | 35,882 | 24,695 | |||||||||||||||||||||||||||||||||
River Club |
Garden | Apr-05 | Edgewater, NJ | 1998 | 266 | 30,578 | 30,638 | 1,910 | 30,579 | 32,547 | 63,126 | (6,208 | ) | 56,918 | 39,373 | |||||||||||||||||||||||||||||||||
River Reach |
Garden | Sep-00 | Naples, FL | 1986 | 556 | 17,728 | 18,337 | 6,365 | 17,728 | 24,702 | 42,430 | (10,002 | ) | 32,428 | 23,452 | |||||||||||||||||||||||||||||||||
Riverbend Village |
Garden | Jul-01 | Arlington, TX | 1983 | 201 | 893 | 4,128 | 4,963 | 893 | 9,091 | 9,984 | (3,967 | ) | 6,017 | | |||||||||||||||||||||||||||||||||
Riverloft |
High Rise | Oct-99 | Philadelphia, PA | 1910 | 184 | 2,120 | 11,287 | 31,118 | 2,120 | 42,405 | 44,525 | (15,462 | ) | 29,063 | 19,951 | |||||||||||||||||||||||||||||||||
Riverside |
High Rise | Apr-00 | Alexandria ,VA | 1973 | 1,222 | 10,433 | 65,474 | 76,986 | 10,433 | 142,460 | 152,893 | (59,333 | ) | 93,560 | 96,289 | |||||||||||||||||||||||||||||||||
Rosewood |
Garden | Mar-02 | Camarillo, CA | 1976 | 152 | 12,128 | 8,060 | 2,407 | 12,430 | 10,165 | 22,595 | (3,320 | ) | 19,275 | 17,900 | |||||||||||||||||||||||||||||||||
Royal Crest Estates |
Garden | Aug-02 | Fall River, MA | 1974 | 216 | 5,832 | 12,044 | 1,953 | 5,832 | 13,997 | 19,829 | (5,694 | ) | 14,135 | 12,161 | |||||||||||||||||||||||||||||||||
Royal Crest Estates |
Garden | Aug-02 | Warwick, RI | 1972 | 492 | 22,433 | 24,095 | 5,296 | 22,433 | 29,391 | 51,824 | (12,162 | ) | 39,662 | 37,890 | |||||||||||||||||||||||||||||||||
Royal Crest Estates |
Garden | Aug-02 | Marlborough, MA | 1970 | 473 | 25,178 | 28,786 | 3,835 | 25,178 | 32,621 | 57,799 | (13,594 | ) | 44,205 | 35,400 | |||||||||||||||||||||||||||||||||
Royal Crest Estates |
Garden | Aug-02 | North Andover, MA | 1970 | 588 | 51,292 | 36,808 | 9,632 | 51,292 | 46,440 | 97,732 | (18,797 | ) | 78,935 | 60,305 | |||||||||||||||||||||||||||||||||
Royal Crest Estates |
Garden | Aug-02 | Nashua, NH | 1970 | 902 | 68,231 | 45,562 | 11,187 | 68,231 | 56,749 | 124,980 | (25,003 | ) | 99,977 | 50,667 | |||||||||||||||||||||||||||||||||
Runaway Bay |
Garden | Oct-00 | Lantana, FL | 1987 | 404 | 5,934 | 16,052 | 7,643 | 5,934 | 23,695 | 29,629 | (7,842 | ) | 21,787 | 21,644 | |||||||||||||||||||||||||||||||||
Runaway Bay |
Garden | Jul-02 | Pinellas Park, FL | 1986 | 192 | 1,884 | 7,045 | 1,831 | 1,884 | 8,876 | 10,760 | (2,402 | ) | 8,358 | 9,004 | |||||||||||||||||||||||||||||||||
Savannah Trace |
Garden | Mar-01 | Shaumburg, IL | 1986 | 368 | 13,960 | 20,731 | 4,001 | 13,960 | 24,732 | 38,692 | (8,502 | ) | 30,190 | 22,282 | |||||||||||||||||||||||||||||||||
Scandia |
Garden | Oct-00 | Indianapolis, IN | 1977 | 444 | 10,540 | 9,852 | 12,780 | 10,539 | 22,633 | 33,172 | (11,260 | ) | 21,912 | 19,163 | |||||||||||||||||||||||||||||||||
Scotchollow |
Garden | Jan-06 | San Mateo, CA | 1971 | 418 | 49,474 | 17,756 | 7,733 | 49,473 | 25,490 | 74,963 | (3,128 | ) | 71,835 | 49,605 | |||||||||||||||||||||||||||||||||
Scottsdale Gateway I |
Garden | Oct-97 | Tempe, AZ | 1965 | 124 | 591 | 3,359 | 8,017 | 591 | 11,376 | 11,967 | (4,075 | ) | 7,892 | 5,800 | |||||||||||||||||||||||||||||||||
Scottsdale Gateway II |
Garden | Oct-97 | Tempe, AZ | 1976 | 487 | 2,458 | 13,927 | 23,353 | 2,458 | 37,280 | 39,738 | (15,204 | ) | 24,534 | 5,087 | |||||||||||||||||||||||||||||||||
Shadow Creek |
Garden | May-98 | Mesa, AZ | 1984 | 266 | 2,016 | 11,886 | 3,790 | 2,016 | 15,676 | 17,692 | (7,685 | ) | 10,007 | | |||||||||||||||||||||||||||||||||
Shenandoah Crossing |
Garden | Sep-00 | Fairfax, VA | 1984 | 640 | 18,492 | 57,197 | 7,499 | 18,492 | 64,696 | 83,188 | (27,715 | ) | 55,473 | 69,724 | |||||||||||||||||||||||||||||||||
Signal Pointe |
Garden | Oct-99 | Winter Park, FL | 1971 | 368 | 2,382 | 11,359 | 21,447 | 2,382 | 32,806 | 35,188 | (10,480 | ) | 24,708 | 18,596 | |||||||||||||||||||||||||||||||||
Signature Point |
Garden | Nov-96 | League City, TX | 1994 | 304 | 2,810 | 17,579 | 2,810 | 2,810 | 20,389 | 23,199 | (6,784 | ) | 16,415 | 10,823 | |||||||||||||||||||||||||||||||||
Springwoods at Lake Ridge |
Garden | Jul-02 | Woodbridge, VA | 1984 | 180 | 5,587 | 7,284 | 1,278 | 5,587 | 8,562 | 14,149 | (1,944 | ) | 12,205 | 14,502 | |||||||||||||||||||||||||||||||||
Spyglass at Cedar Cove |
Garden | Sep-00 | Lexington Park, MD | 1985 | 152 | 3,241 | 5,094 | 2,479 | 3,241 | 7,573 | 10,814 | (3,237 | ) | 7,577 | 10,300 | |||||||||||||||||||||||||||||||||
Stafford |
High Rise | Oct-02 | Baltimore, MD | 1889 | 96 | 706 | 4,032 | 3,131 | 562 | 7,307 | 7,869 | (3,524 | ) | 4,345 | 4,315 | |||||||||||||||||||||||||||||||||
Steeplechase |
Garden | Sep-00 | Largo, MD | 1986 | 240 | 3,675 | 16,111 | 3,301 | 3,675 | 19,412 | 23,087 | (7,106 | ) | 15,981 | 23,600 | |||||||||||||||||||||||||||||||||
Steeplechase |
Garden | Jul-02 | Plano, TX | 1985 | 368 | 7,056 | 10,510 | 6,974 | 7,056 | 17,484 | 24,540 | (5,158 | ) | 19,382 | 13,987 | |||||||||||||||||||||||||||||||||
Sterling Apartment Homes, The |
Garden | Oct-99 | Philadelphia, PA | 1962 | 535 | 8,871 | 55,364 | 17,358 | 8,871 | 72,722 | 81,593 | (30,782 | ) | 50,811 | 77,915 | |||||||||||||||||||||||||||||||||
Stone Creek Club |
Garden | Sep-00 | Germantown, MD | 1984 | 240 | 13,593 | 9,347 | 2,948 | 13,593 | 12,295 | 25,888 | (6,743 | ) | 19,145 | 24,900 | |||||||||||||||||||||||||||||||||
Sun Lake |
Garden | May-98 | Lake Mary, FL | 1986 | 600 | 4,551 | 25,543 | 30,903 | 4,551 | 56,446 | 60,997 | (20,010 | ) | 40,987 | 35,727 | |||||||||||||||||||||||||||||||||
Sun River Village |
Garden | Oct-99 | Tempe ,AZ | 1981 | 334 | 2,367 | 13,303 | 3,888 | 2,367 | 17,191 | 19,558 | (8,524 | ) | 11,034 | 10,569 | |||||||||||||||||||||||||||||||||
Tamarac Village |
Garden | Apr-00 | Denver, CO | 1979 | 564 | 3,928 | 23,491 | 8,089 | 4,223 | 31,285 | 35,508 | (16,205 | ) | 19,303 | 18,389 | |||||||||||||||||||||||||||||||||
Tamarind Bay |
Garden | Jan-00 | St. Petersburg, FL | 1980 | 200 | 1,091 | 6,310 | 4,987 | 1,091 | 11,297 | 12,388 | (5,368 | ) | 7,020 | 6,925 | |||||||||||||||||||||||||||||||||
Tatum Gardens |
Garden | May-98 | Phoenix, AZ | 1985 | 128 | 1,323 | 7,155 | 1,928 | 1,323 | 9,083 | 10,406 | (4,706 | ) | 5,700 | 7,403 | |||||||||||||||||||||||||||||||||
The Bluffs at Pacifica |
Garden | Oct-06 | Pacifica, CA | 1963 | 64 | 7,975 | 4,131 | 7,635 | 8,108 | 11,633 | 19,741 | (1,067 | ) | 18,674 | 6,428 | |||||||||||||||||||||||||||||||||
Timbertree |
Garden | Oct-97 | Phoenix, AZ | 1979 | 387 | 2,292 | 13,000 | 6,209 | 2,292 | 19,209 | 21,501 | (9,830 | ) | 11,671 | 4,510 | |||||||||||||||||||||||||||||||||
Towers Of Westchester Park, The |
High Rise | Jan-06 | College Park, MD | 1972 | 303 | 15,198 | 22,029 | 4,504 | 15,198 | 26,533 | 41,731 | (3,946 | ) | 37,785 | 27,667 |
74
(2) | (3) | |||||||||||||||||||||||||||||||||||||||||||||||
(1) | Initial Cost | Cost Capitalized | December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Property | Date | Year | Number | Buildings and | Subsequent to | Buildings and | (5) | Accumulated | Total Cost | |||||||||||||||||||||||||||||||||||||||
Property Name | Type | Consolidated | Location | Built | of Units | Land | Improvements | Consolidation | Land | Improvements | Total | Depreciation (AD) | Net of AD | Encumbrances | ||||||||||||||||||||||||||||||||||
Township At Highlands |
Town Home | Nov-96 | Centennial, CO | 1985 | 161 | 1,615 | 9,773 | 6,118 | 1,536 | 15,970 | 17,506 | (6,955 | ) | 10,551 | 16,640 | |||||||||||||||||||||||||||||||||
Twin Lake Towers |
High Rise | Oct-99 | Westmont, IL | 1969 | 399 | 3,268 | 18,763 | 23,625 | 3,268 | 42,388 | 45,656 | (15,984 | ) | 29,672 | 9,255 | |||||||||||||||||||||||||||||||||
Twin Lakes |
Garden | Apr-00 | Palm Harbor, FL | 1986 | 262 | 2,062 | 12,850 | 4,584 | 2,062 | 17,434 | 19,496 | (7,652 | ) | 11,844 | 10,604 | |||||||||||||||||||||||||||||||||
Vantage Pointe |
Mid Rise | Aug-02 | Swampscott, MA | 1987 | 96 | 4,749 | 10,089 | 1,351 | 4,749 | 11,440 | 16,189 | (3,498 | ) | 12,691 | 7,385 | |||||||||||||||||||||||||||||||||
Verandahs at Hunt Club |
Garden | Jul-02 | Apopka, FL | 1985 | 210 | 2,271 | 7,724 | 2,974 | 2,271 | 10,698 | 12,969 | (2,641 | ) | 10,328 | 11,070 | |||||||||||||||||||||||||||||||||
Views at Vinings Mountain, The |
Garden | Jan-06 | Atlanta, GA | 1983 | 180 | 610 | 5,026 | 12,209 | 610 | 17,235 | 17,845 | (7,559 | ) | 10,286 | 13,757 | |||||||||||||||||||||||||||||||||
Villa Del Sol |
Garden | Mar-02 | Norwalk, CA | 1972 | 120 | 7,294 | 4,861 | 2,512 | 7,476 | 7,191 | 14,667 | (2,670 | ) | 11,997 | 13,500 | |||||||||||||||||||||||||||||||||
Village Crossing |
Garden | May-98 | West Palm Beach, FL | 1986 | 189 | 1,618 | 8,188 | 2,941 | 1,618 | 11,129 | 12,747 | (5,497 | ) | 7,250 | 7,000 | |||||||||||||||||||||||||||||||||
Village in the Woods |
Garden | Jan-00 | Cypress, TX | 1983 | 530 | 3,457 | 15,787 | 10,230 | 3,457 | 26,017 | 29,474 | (12,765 | ) | 16,709 | 19,451 | |||||||||||||||||||||||||||||||||
Village of Pennbrook |
Garden | Oct-98 | Levittown, PA | 1969 | 722 | 10,229 | 38,222 | 13,539 | 10,229 | 51,761 | 61,990 | (22,047 | ) | 39,943 | 48,419 | |||||||||||||||||||||||||||||||||
Villages of Baymeadows |
Garden | Oct-99 | Jacksonville, FL | 1972 | 904 | 4,859 | 33,957 | 53,735 | 4,859 | 87,692 | 92,551 | (40,263 | ) | 52,288 | 38,050 | |||||||||||||||||||||||||||||||||
Villas at Park La Brea, The |
Garden | Mar-02 | Los Angeles, CA | 2002 | 250 | 8,621 | 48,871 | 3,603 | 8,630 | 52,465 | 61,095 | (12,802 | ) | 48,293 | 30,564 | |||||||||||||||||||||||||||||||||
Vista Del Lagos |
Garden | Dec-97 | Chandler, AZ | 1986 | 200 | 804 | 4,952 | 3,442 | 804 | 8,394 | 9,198 | (3,431 | ) | 5,767 | 11,783 | |||||||||||||||||||||||||||||||||
Waterford Village |
Garden | Aug-02 | Bridgewater, MA | 1971 | 588 | 28,585 | 28,102 | 5,591 | 29,110 | 33,168 | 62,278 | (15,640 | ) | 46,638 | 40,542 | |||||||||||||||||||||||||||||||||
Waterways Village |
Garden | Jun-97 | Aventura, FL | 1991 | 180 | 4,504 | 11,064 | 3,683 | 4,504 | 14,747 | 19,251 | (6,456 | ) | 12,795 | 7,145 | |||||||||||||||||||||||||||||||||
Waverly Apartments |
Garden | Aug-08 | Brighton, MA | 1970 | 103 | 7,696 | 11,347 | 1,188 | 7,920 | 12,311 | 20,231 | (723 | ) | 19,508 | 12,000 | |||||||||||||||||||||||||||||||||
West Winds |
Garden | Oct-02 | Orlando, FL | 1985 | 272 | 2,324 | 11,481 | 3,030 | 2,324 | 14,511 | 16,835 | (4,829 | ) | 12,006 | 12,776 | |||||||||||||||||||||||||||||||||
Westway Village |
Garden | May-98 | Houston, TX | 1979 | 326 | 2,921 | 11,384 | 3,172 | 2,921 | 14,556 | 17,477 | (6,586 | ) | 10,891 | 7,677 | |||||||||||||||||||||||||||||||||
Wexford Village |
Garden | Aug-02 | Worcester, MA | 1974 | 264 | 6,339 | 17,939 | 2,082 | 6,339 | 20,021 | 26,360 | (7,250 | ) | 19,110 | 13,924 | |||||||||||||||||||||||||||||||||
Willow Bend |
Garden | May-98 | Rolling Meadows, IL | 1985 | 328 | 2,717 | 15,437 | 26,391 | 2,717 | 41,828 | 44,545 | (13,960 | ) | 30,585 | 19,876 | |||||||||||||||||||||||||||||||||
Willow Park on Lake Adelaide |
Garden | Oct-99 | Altamonte Springs, FL | 1972 | 185 | 1,225 | 7,357 | 3,266 | 1,224 | 10,624 | 11,848 | (5,611 | ) | 6,237 | 6,804 | |||||||||||||||||||||||||||||||||
Windrift |
Garden | Mar-01 | Oceanside, CA | 1987 | 404 | 24,960 | 17,590 | 18,667 | 24,960 | 36,257 | 61,217 | (15,443 | ) | 45,774 | 28,999 | |||||||||||||||||||||||||||||||||
Windrift |
Garden | Oct-00 | Orlando, FL | 1987 | 288 | 3,696 | 10,029 | 5,495 | 3,696 | 15,524 | 19,220 | (5,710 | ) | 13,510 | 17,094 | |||||||||||||||||||||||||||||||||
Windsor Crossing |
Garden | Mar-00 | Newport News, VA | 1978 | 156 | 307 | 2,110 | 1,992 | 131 | 4,278 | 4,409 | (2,102 | ) | 2,307 | 2,153 | |||||||||||||||||||||||||||||||||
Windsor Park |
Garden | Mar-01 | Woodbridge, VA | 1987 | 220 | 4,279 | 15,970 | 2,172 | 4,279 | 18,142 | 22,421 | (6,430 | ) | 15,991 | 13,444 | |||||||||||||||||||||||||||||||||
Woodcreek |
Garden | Oct-02 | Mesa, AZ | 1985 | 432 | 2,426 | 15,886 | 4,487 | 2,426 | 20,373 | 22,799 | (10,400 | ) | 12,399 | 19,449 | |||||||||||||||||||||||||||||||||
Woods of Burnsville |
Garden | Nov-04 | Burnsville, MN | 1984 | 400 | 3,954 | 18,125 | 2,694 | 3,954 | 20,819 | 24,773 | (7,429 | ) | 17,344 | 16,580 | |||||||||||||||||||||||||||||||||
Woods of Inverness |
Garden | Oct-99 | Houston, TX | 1983 | 272 | 2,146 | 10,978 | 3,860 | 2,146 | 14,838 | 16,984 | (7,194 | ) | 9,790 | 5,878 | |||||||||||||||||||||||||||||||||
Woods Of Williamsburg |
Garden | Jan-06 | Williamsburg, VA | 1976 | 125 | 798 | 3,657 | 873 | 798 | 4,530 | 5,328 | (3,309 | ) | 2,019 | 1,189 | |||||||||||||||||||||||||||||||||
Yacht Club at Brickell |
High Rise | Dec-03 | Miami, FL | 1998 | 357 | 31,363 | 32,214 | 4,297 | 31,363 | 36,511 | 67,874 | (5,900 | ) | 61,974 | 37,804 | |||||||||||||||||||||||||||||||||
Yorktown Apartments |
High Rise | Dec-99 | Lombard, IL | 1973 | 364 | 2,971 | 18,163 | 16,098 | 3,055 | 34,177 | 37,232 | (10,538 | ) | 26,694 | 22,626 | |||||||||||||||||||||||||||||||||
Total Conventional Properties: |
69,377 | 1,970,960 | 3,818,111 | 2,152,391 | 2,027,400 | 5,914,062 | 7,941,462 | (2,107,835 | ) | 5,833,627 | 4,691,425 | |||||||||||||||||||||||||||||||||||||
Affordable Properties: |
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All Hallows |
Garden | Jan-06 | San Francisco, CA | 1976 | 157 | 1,348 | 29,770 | 20,124 | 1,338 | 49,904 | 51,242 | (15,590 | ) | 35,652 | 21,219 | |||||||||||||||||||||||||||||||||
Alliance Towers |
High Rise | Mar-02 | Alliance, OH | 1971 | 101 | 530 | 1,934 | 756 | 530 | 2,690 | 3,220 | (745 | ) | 2,475 | 2,234 | |||||||||||||||||||||||||||||||||
Arvada House |
High Rise | Nov-04 | Arvada, CO | 1977 | 88 | 641 | 3,314 | 1,746 | 405 | 5,296 | 5,701 | (1,304 | ) | 4,397 | 4,152 | |||||||||||||||||||||||||||||||||
Ashland Manor |
High Rise | Mar-02 | Toledo, OH | 1977 | 189 | 205 | 455 | 363 | 205 | 818 | 1,023 | (667 | ) | 356 | 561 | |||||||||||||||||||||||||||||||||
Bannock Arms |
Garden | Mar-02 | Boise, ID | 1978 | 66 | 275 | 1,139 | 571 | 275 | 1,710 | 1,985 | (575 | ) | 1,410 | 1,406 | |||||||||||||||||||||||||||||||||
Bayview |
Garden | Jun-05 | San Francisco, CA | 1976 | 146 | 1,023 | 15,265 | 16,548 | 582 | 32,254 | 32,836 | (9,118 | ) | 23,718 | 12,520 | |||||||||||||||||||||||||||||||||
Beacon Hill |
High Rise | Mar-02 | Hillsdale, MI | 1980 | 198 | 1,380 | 7,044 | 6,599 | 1,093 | 13,930 | 15,023 | (3,236 | ) | 11,787 | 4,616 | |||||||||||||||||||||||||||||||||
Bedford House |
Mid Rise | Mar-02 | Falmouth, KY | 1979 | 48 | 230 | 919 | 310 | 230 | 1,229 | 1,459 | (434 | ) | 1,025 | 1,084 | |||||||||||||||||||||||||||||||||
Benjamin Banneker Plaza |
Mid Rise | Jan-06 | Chester, PA | 1976 | 70 | 79 | 3,862 | 670 | 79 | 4,532 | 4,611 | (2,890 | ) | 1,721 | 1,538 | |||||||||||||||||||||||||||||||||
Berger Apartments |
Mid Rise | Mar-02 | New Haven, CT | 1981 | 144 | 1,152 | 4,657 | 2,229 | 1,152 | 6,886 | 8,038 | (2,080 | ) | 5,958 | 1,061 | |||||||||||||||||||||||||||||||||
Biltmore Towers |
High Rise | Mar-02 | Dayton, OH | 1980 | 230 | 1,813 | 6,411 | 13,073 | 1,813 | 19,484 | 21,297 | (8,817 | ) | 12,480 | 10,648 | |||||||||||||||||||||||||||||||||
Blakewood |
Garden | Oct-05 | Statesboro, GA | 1973 | 42 | 316 | 882 | 373 | 316 | 1,255 | 1,571 | (1,085 | ) | 486 | 698 | |||||||||||||||||||||||||||||||||
Bolton North |
High Rise | Jan-06 | Baltimore, MD | 1977 | 209 | 1,450 | 6,569 | 649 | 1,429 | 7,239 | 8,668 | (2,347 | ) | 6,321 | 2,438 | |||||||||||||||||||||||||||||||||
Burchwood |
Garden | Oct-07 | Berea, KY | 1999 | 24 | 253 | 1,173 | 551 | 253 | 1,724 | 1,977 | (958 | ) | 1,019 | 981 | |||||||||||||||||||||||||||||||||
Butternut Creek |
Mid Rise | Jan-06 | Charlotte, MI | 1980 | 100 | 505 | 3,617 | 3,957 | 505 | 7,574 | 8,079 | (2,239 | ) | 5,840 | | |||||||||||||||||||||||||||||||||
Cache Creek Apartment Homes |
Mid Rise | Jun-04 | Clearlake, CA | 1986 | 80 | 1,545 | 9,405 | 494 | 1,545 | 9,899 | 11,444 | (2,866 | ) | 8,578 | 2,302 | |||||||||||||||||||||||||||||||||
California Square I |
High Rise | Jan-06 | Louisville, KY | 1982 | 101 | 154 | 5,704 | 523 | 154 | 6,227 | 6,381 | (3,600 | ) | 2,781 | 3,499 | |||||||||||||||||||||||||||||||||
Canterbury Towers |
High Rise | Jan-06 | Worcester, MA | 1976 | 156 | 567 | 4,557 | 936 | 567 | 5,493 | 6,060 | (3,681 | ) | 2,379 | 3,966 | |||||||||||||||||||||||||||||||||
Carriage House |
Mid Rise | Dec-06 | Petersburg, VA | 1885 | 118 | 847 | 2,886 | 3,356 | 716 | 6,373 | 7,089 | (1,407 | ) | 5,682 | 2,273 | |||||||||||||||||||||||||||||||||
Casa de Las Hermanitas |
Garden | Mar-02 | Los Angeles, CA | 1982 | 88 | 1,775 | 4,606 | 4,222 | 1,879 | 8,724 | 10,603 | (1,118 | ) | 9,485 | 5,081 | |||||||||||||||||||||||||||||||||
Castlewood |
Garden | Mar-02 | Davenport, IA | 1980 | 96 | 585 | 2,351 | 1,443 | 585 | 3,794 | 4,379 | (1,497 | ) | 2,882 | 3,503 | |||||||||||||||||||||||||||||||||
City Line |
Garden | Mar-02 | Newport News, VA | 1976 | 200 | 500 | 2,014 | 7,172 | 500 | 9,186 | 9,686 | (2,046 | ) | 7,640 | 4,863 | |||||||||||||||||||||||||||||||||
Clisby Towers |
Mid Rise | Jan-06 | Macon, GA | 1980 | 52 | 524 | 1,970 | 228 | 524 | 2,198 | 2,722 | (1,677 | ) | 1,045 | 939 | |||||||||||||||||||||||||||||||||
Club, The |
Garden | Jan-06 | Lexington, NC | 1972 | 87 | 498 | 2,128 | 662 | 498 | 2,790 | 3,288 | (1,978 | ) | 1,310 | 303 | |||||||||||||||||||||||||||||||||
Coatesville Towers |
High Rise | Mar-02 | Coatesville, PA | 1979 | 90 | 500 | 2,011 | 693 | 500 | 2,704 | 3,204 | (866 | ) | 2,338 | 2,108 | |||||||||||||||||||||||||||||||||
Cold Spring Homes |
Garden | Oct-07 | Cold Springs, KY | 2000 | 30 | 187 | 917 | 1,122 | 187 | 2,039 | 2,226 | (1,441 | ) | 785 | 790 | |||||||||||||||||||||||||||||||||
Community Circle II |
Garden | Jan-06 | Cleveland, OH | 1975 | 129 | 263 | 4,699 | 804 | 263 | 5,503 | 5,766 | (3,265 | ) | 2,501 | 3,275 | |||||||||||||||||||||||||||||||||
Copperwood I Apartments |
Garden | Apr-06 | The Woodlands, TX | 1980 | 150 | 390 | 8,373 | 4,862 | 363 | 13,262 | 13,625 | (8,167 | ) | 5,458 | 5,590 | |||||||||||||||||||||||||||||||||
Copperwood II Apartments |
Garden | Oct-05 | The Woodlands, TX | 1981 | 150 | 452 | 5,552 | 3,415 | 459 | 8,960 | 9,419 | (3,134 | ) | 6,285 | 5,773 | |||||||||||||||||||||||||||||||||
Country Club Heights |
Garden | Mar-04 | Quincy, IL | 1976 | 200 | 676 | 5,715 | 4,841 | 675 | 10,557 | 11,232 | (3,837 | ) | 7,395 | 7,312 | |||||||||||||||||||||||||||||||||
Country Commons |
Garden | Jan-06 | Bensalem, PA | 1972 | 352 | 1,853 | 17,657 | 2,308 | 1,853 | 19,965 | 21,818 | (10,649 | ) | 11,169 | 4,715 | |||||||||||||||||||||||||||||||||
Courtyard |
Mid Rise | Jan-06 | Cincinnati, OH | 1980 | 137 | 1,362 | 4,876 | 448 | 1,362 | 5,324 | 6,686 | (3,126 | ) | 3,560 | 3,830 |
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(1) | Initial Cost | Cost Capitalized | December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Property | Date | Year | Number | Buildings and | Subsequent to | Buildings and | (5) | Accumulated | Total Cost | |||||||||||||||||||||||||||||||||||||||
Property Name | Type | Consolidated | Location | Built | of Units | Land | Improvements | Consolidation | Land | Improvements | Total | Depreciation (AD) | Net of AD | Encumbrances | ||||||||||||||||||||||||||||||||||
Crevenna Oaks |
Town Home | Jan-06 | Burke, VA | 1979 | 50 | 355 | 4,849 | 219 | 355 | 5,068 | 5,423 | (945 | ) | 4,478 | 3,312 | |||||||||||||||||||||||||||||||||
Crockett Manor |
Garden | Mar-04 | Trenton, TN | 1982 | 38 | 42 | 1,395 | 38 | 42 | 1,433 | 1,475 | (37 | ) | 1,438 | 978 | |||||||||||||||||||||||||||||||||
Cumberland Court |
Garden | Jan-06 | Harrisburg, PA | 1975 | 108 | 379 | 4,040 | 682 | 379 | 4,722 | 5,101 | (3,282 | ) | 1,819 | 1,314 | |||||||||||||||||||||||||||||||||
Daugette Tower |
High Rise | Mar-02 | Gadsden, AL | 1979 | 100 | 540 | 2,178 | 1,744 | 540 | 3,922 | 4,462 | (1,324 | ) | 3,138 | 117 | |||||||||||||||||||||||||||||||||
Delhaven Manor |
Mid Rise | Mar-02 | Jackson, MS | 1983 | 104 | 575 | 2,304 | 1,986 | 575 | 4,290 | 4,865 | (1,621 | ) | 3,244 | 3,758 | |||||||||||||||||||||||||||||||||
Denny Place |
Garden | Mar-02 | North Hollywood, CA | 1984 | 17 | 394 | 1,579 | 139 | 394 | 1,718 | 2,112 | (479 | ) | 1,633 | 1,121 | |||||||||||||||||||||||||||||||||
Douglas Landing |
Garden | Oct-07 | Austin, TX | 1999 | 96 | 11 | 4,989 | 22 | 11 | 5,011 | 5,022 | | 5,022 | 4,000 | ||||||||||||||||||||||||||||||||||
Elmwood |
Garden | Jan-06 | Athens, AL | 1981 | 80 | 346 | 2,643 | 346 | 346 | 2,989 | 3,335 | (1,673 | ) | 1,662 | 1,869 | |||||||||||||||||||||||||||||||||
Fairburn And Gordon II |
Garden | Jan-06 | Atlanta, GA | 1969 | 58 | 439 | 1,647 | 231 | 439 | 1,878 | 2,317 | (1,469 | ) | 848 | 98 | |||||||||||||||||||||||||||||||||
Fairwood |
Garden | Jan-06 | Carmichael, CA | 1979 | 86 | 176 | 5,264 | 379 | 176 | 5,643 | 5,819 | (3,523 | ) | 2,296 | 2,475 | |||||||||||||||||||||||||||||||||
Fountain Place |
Mid Rise | Jan-06 | Connersville, IN | 1980 | 102 | 440 | 2,091 | 2,883 | 447 | 4,967 | 5,414 | (511 | ) | 4,903 | 1,155 | |||||||||||||||||||||||||||||||||
Fox Run |
Garden | Mar-02 | Orange, TX | 1983 | 70 | 420 | 1,992 | 1,026 | 420 | 3,018 | 3,438 | (928 | ) | 2,510 | 2,563 | |||||||||||||||||||||||||||||||||
Foxfire |
Garden | Jan-06 | Jackson, MI | 1975 | 160 | 856 | 6,853 | 1,423 | 856 | 8,276 | 9,132 | (5,247 | ) | 3,885 | 1,803 | |||||||||||||||||||||||||||||||||
Franklin Square School Apts |
Mid Rise | Jan-06 | Baltimore, MD | 1888 | 65 | 566 | 3,581 | 216 | 566 | 3,797 | 4,363 | (2,153 | ) | 2,210 | 2,099 | |||||||||||||||||||||||||||||||||
Friendset Apartments |
High Rise | Jan-06 | Brooklyn, NY | 1979 | 259 | 550 | 16,825 | 1,737 | 550 | 18,562 | 19,112 | (10,414 | ) | 8,698 | 14,404 | |||||||||||||||||||||||||||||||||
Frio |
Garden | Jan-06 | Pearsall, TX | 1980 | 63 | 327 | 2,207 | 407 | 327 | 2,614 | 2,941 | (1,728 | ) | 1,213 | 1,109 | |||||||||||||||||||||||||||||||||
Gates Manor |
Garden | Mar-04 | Clinton, TN | 1981 | 80 | 266 | 2,225 | 881 | 264 | 3,108 | 3,372 | (1,195 | ) | 2,177 | 2,411 | |||||||||||||||||||||||||||||||||
Gateway Village |
Garden | Mar-04 | Hillsborough, NC | 1980 | 64 | 433 | 1,666 | 580 | 515 | 2,164 | 2,679 | (746 | ) | 1,933 | 2,360 | |||||||||||||||||||||||||||||||||
Glens, The |
Garden | Jan-06 | Rock Hill, SC | 1982 | 88 | 839 | 4,135 | 1,140 | 839 | 5,275 | 6,114 | (3,627 | ) | 2,487 | 3,757 | |||||||||||||||||||||||||||||||||
Greenbriar |
Garden | Jan-06 | Indianapolis, IN | 1980 | 121 | 812 | 3,272 | 346 | 812 | 3,618 | 4,430 | (2,491 | ) | 1,939 | 1,098 | |||||||||||||||||||||||||||||||||
Hamlin Estates |
Garden | Mar-02 | North Hollywood, CA | 1983 | 30 | 1,010 | 1,691 | 241 | 1,010 | 1,932 | 2,942 | (678 | ) | 2,264 | 1,515 | |||||||||||||||||||||||||||||||||
Hanover Square |
High Rise | Jan-06 | Baltimore, MD | 1980 | 199 | 1,656 | 9,575 | 425 | 1,656 | 10,000 | 11,656 | (6,267 | ) | 5,389 | 5,495 | |||||||||||||||||||||||||||||||||
Harris Park Apartments |
Garden | Dec-97 | Rochester, NY | 1968 | 114 | 475 | 2,786 | 1,101 | 475 | 3,887 | 4,362 | (1,824 | ) | 2,538 | 200 | |||||||||||||||||||||||||||||||||
Hatillo Housing |
Mid Rise | Jan-06 | Hatillo, PR | 1982 | 64 | 202 | 2,875 | 204 | 202 | 3,079 | 3,281 | (1,820 | ) | 1,461 | 1,370 | |||||||||||||||||||||||||||||||||
Hemet Estates |
Garden | Mar-02 | Hemet, CA | 1983 | 80 | 700 | 2,802 | 2,995 | 420 | 6,077 | 6,497 | (1,138 | ) | 5,359 | 4,316 | |||||||||||||||||||||||||||||||||
Henna Townhomes |
Garden | Oct-07 | Round Rock, TX | 1999 | 160 | 1,047 | 12,893 | 84 | 1,047 | 12,977 | 14,024 | (2,641 | ) | 11,383 | 6,172 | |||||||||||||||||||||||||||||||||
Heritage House |
Mid Rise | Jan-06 | Lewisburg, PA | 1982 | 80 | 178 | 3,251 | 131 | 178 | 3,382 | 3,560 | (2,034 | ) | 1,526 | 2,106 | |||||||||||||||||||||||||||||||||
Hopkins Village |
Mid Rise | Sep-03 | Baltimore, MD | 1979 | 165 | 438 | 5,973 | 3,680 | 452 | 9,639 | 10,091 | (1,192 | ) | 8,899 | 9,100 | |||||||||||||||||||||||||||||||||
Hudson Gardens |
Garden | Mar-02 | Pasadena, CA | 1983 | 41 | 914 | 1,548 | 335 | 914 | 1,883 | 2,797 | (644 | ) | 2,153 | 539 | |||||||||||||||||||||||||||||||||
Indio Gardens |
Mid Rise | Oct-06 | Indio, CA | 1980 | 151 | 775 | 8,759 | 4,155 | 775 | 12,914 | 13,689 | (1,213 | ) | 12,476 | 4,173 | |||||||||||||||||||||||||||||||||
Ingram Square |
Garden | Jan-06 | San Antonio, TX | 1980 | 120 | 630 | 3,137 | 5,716 | 630 | 8,853 | 9,483 | (1,338 | ) | 8,145 | 3,825 | |||||||||||||||||||||||||||||||||
Jenny Lind Hall |
High Rise | Mar-04 | Springfield, MO | 1977 | 78 | 142 | 3,684 | 260 | 142 | 3,944 | 4,086 | (358 | ) | 3,728 | 942 | |||||||||||||||||||||||||||||||||
JFK Towers |
Mid Rise | Jan-06 | Durham, NC | 1983 | 177 | 750 | 7,970 | 773 | 750 | 8,743 | 9,493 | (4,678 | ) | 4,815 | 5,796 | |||||||||||||||||||||||||||||||||
Kephart Plaza |
High Rise | Jan-06 | Lock Haven, PA | 1978 | 101 | 609 | 3,796 | 462 | 609 | 4,258 | 4,867 | (2,987 | ) | 1,880 | 1,488 | |||||||||||||||||||||||||||||||||
King Bell Apartments |
Garden | Jan-06 | Milwaukie, OR | 1982 | 62 | 204 | 2,497 | 193 | 204 | 2,690 | 2,894 | (1,451 | ) | 1,443 | 1,631 | |||||||||||||||||||||||||||||||||
Kirkwood House |
High Rise | Sep-04 | Baltimore, MD | 1979 | 261 | 1,281 | 9,358 | 6,398 | 1,275 | 15,762 | 17,037 | (1,929 | ) | 15,108 | 16,000 | |||||||||||||||||||||||||||||||||
Kubasek Trinity Manor (The Hollows) |
High Rise | Jan-06 | Yonkers, NY | 1981 | 130 | 54 | 8,308 | 1,788 | 54 | 10,096 | 10,150 | (5,033 | ) | 5,117 | 4,749 | |||||||||||||||||||||||||||||||||
La Salle |
Garden | Oct-00 | San Francisco, CA | 1976 | 145 | 1,841 | 19,568 | 16,650 | 1,866 | 36,193 | 38,059 | (12,408 | ) | 25,651 | 15,992 | |||||||||||||||||||||||||||||||||
La Vista |
Garden | Jan-06 | Concord, CA | 1981 | 75 | 565 | 4,448 | 4,223 | 581 | 8,655 | 9,236 | (909 | ) | 8,327 | 5,499 | |||||||||||||||||||||||||||||||||
Lafayette Square |
Garden | Jan-06 | Camden, SC | 1978 | 72 | 142 | 1,875 | 79 | 142 | 1,954 | 2,096 | (1,629 | ) | 467 | 270 | |||||||||||||||||||||||||||||||||
Lakeview Arms |
Mid Rise | Jan-06 | Poughkeepsie, NY | 1981 | 72 | 111 | 3,256 | 288 | 111 | 3,544 | 3,655 | (2,182 | ) | 1,473 | 1,790 | |||||||||||||||||||||||||||||||||
Landau |
Garden | Oct-05 | Clinton, SC | 1970 | 80 | 1,293 | 1,429 | 246 | 1,293 | 1,675 | 2,968 | (1,675 | ) | 1,293 | 283 | |||||||||||||||||||||||||||||||||
Laurelwood |
Garden | Jan-06 | Morristown, TN | 1981 | 65 | 75 | 1,870 | 179 | 75 | 2,049 | 2,124 | (1,275 | ) | 849 | 1,320 | |||||||||||||||||||||||||||||||||
Lock Haven Gardens |
Garden | Jan-06 | Lock Haven, PA | 1979 | 150 | 1,163 | 6,045 | 606 | 1,163 | 6,651 | 7,814 | (4,643 | ) | 3,171 | 2,860 | |||||||||||||||||||||||||||||||||
Locust House |
High Rise | Mar-02 | Westminster, MD | 1979 | 99 | 650 | 2,604 | 786 | 650 | 3,390 | 4,040 | (1,123 | ) | 2,917 | 2,264 | |||||||||||||||||||||||||||||||||
Long Meadow |
Garden | Jan-06 | Cheraw, SC | 1973 | 56 | 158 | 1,342 | 174 | 158 | 1,516 | 1,674 | (1,168 | ) | 506 | 198 | |||||||||||||||||||||||||||||||||
Loring Towers |
High Rise | Oct-02 | Minneapolis, MN | 1975 | 230 | 1,297 | 7,445 | 7,587 | 886 | 15,443 | 16,329 | (4,248 | ) | 12,081 | 7,387 | |||||||||||||||||||||||||||||||||
Loring Towers Apartments |
High Rise | Sep-03 | Salem, MA | 1973 | 250 | 129 | 14,050 | 6,414 | 140 | 20,453 | 20,593 | (3,664 | ) | 16,929 | 16,177 | |||||||||||||||||||||||||||||||||
Lynnhaven |
Garden | Mar-04 | Durham, NC | 1980 | 75 | 539 | 2,159 | 793 | 563 | 2,928 | 3,491 | (652 | ) | 2,839 | 2,787 | |||||||||||||||||||||||||||||||||
Michigan Beach |
Garden | Oct-07 | Chicago, IL | 1958 | 239 | 2,225 | 10,797 | 757 | 2,225 | 11,554 | 13,779 | (3,296 | ) | 10,483 | 5,510 | |||||||||||||||||||||||||||||||||
Mill Pond |
Mid Rise | Jan-06 | Taunton, MA | 1982 | 49 | 80 | 2,704 | 311 | 80 | 3,015 | 3,095 | (1,655 | ) | 1,440 | 1,301 | |||||||||||||||||||||||||||||||||
Miramar Housing |
High Rise | Jan-06 | Ponce, PR | 1983 | 96 | 367 | 5,085 | 194 | 367 | 5,279 | 5,646 | (2,946 | ) | 2,700 | 2,869 | |||||||||||||||||||||||||||||||||
Montblanc Gardens |
Town Home | Dec-03 | Yauco, PR | 1982 | 128 | 391 | 3,859 | 959 | 391 | 4,818 | 5,209 | (2,469 | ) | 2,740 | 3,282 | |||||||||||||||||||||||||||||||||
Moss Gardens |
Mid Rise | Jan-06 | Lafayette, LA | 1980 | 114 | 524 | 3,818 | 257 | 524 | 4,075 | 4,599 | (3,058 | ) | 1,541 | 1,991 | |||||||||||||||||||||||||||||||||
New Baltimore |
Mid Rise | Mar-02 | New Baltimore, MI | 1980 | 101 | 888 | 2,360 | 5,154 | 896 | 7,506 | 8,402 | (1,459 | ) | 6,943 | 2,213 | |||||||||||||||||||||||||||||||||
Newberry Park |
Garden | Dec-97 | Chicago, IL | 1985 | 82 | 1,380 | 7,632 | 459 | 1,380 | 8,091 | 9,471 | (2,739 | ) | 6,732 | 7,399 | |||||||||||||||||||||||||||||||||
Northlake Village |
Garden | Oct-00 | Lima, OH | 1971 | 150 | 487 | 1,317 | 1,791 | 487 | 3,108 | 3,595 | (1,736 | ) | 1,859 | 608 | |||||||||||||||||||||||||||||||||
Northpoint |
Garden | Jan-00 | Chicago, IL | 1921 | 304 | 2,280 | 14,334 | 16,403 | 2,510 | 30,507 | 33,017 | (14,624 | ) | 18,393 | 19,556 | |||||||||||||||||||||||||||||||||
Northwinds, The |
Garden | Mar-02 | Wytheville, VA | 1978 | 144 | 500 | 2,012 | 525 | 500 | 2,537 | 3,037 | (1,339 | ) | 1,698 | 1,599 | |||||||||||||||||||||||||||||||||
Oakbrook |
Garden | Jan-08 | Topeka, KS | 1979 | 170 | 240 | 6,200 | 7 | 240 | 6,207 | 6,447 | (2,773 | ) | 3,674 | 2,770 | |||||||||||||||||||||||||||||||||
Oakwood Manor |
Garden | Mar-04 | Milan, TN | 1984 | 34 | 95 | 498 | 27 | 95 | 525 | 620 | (96 | ) | 524 | 433 | |||||||||||||||||||||||||||||||||
ONeil |
High Rise | Jan-06 | Troy, NY | 1978 | 115 | 88 | 4,067 | 791 | 88 | 4,858 | 4,946 | (3,278 | ) | 1,668 | 1,353 | |||||||||||||||||||||||||||||||||
Orange Village |
Garden | Jan-06 | Hermitage, PA | 1979 | 81 | 79 | 3,406 | 436 | 79 | 3,842 | 3,921 | (2,361 | ) | 1,560 | 1,833 | |||||||||||||||||||||||||||||||||
Overbrook Park |
Garden | Jan-06 | Chillicothe, OH | 1981 | 50 | 136 | 2,282 | 198 | 136 | 2,480 | 2,616 | (1,377 | ) | 1,239 | 1,447 | |||||||||||||||||||||||||||||||||
Oxford House |
Mid Rise | Mar-02 | Deactur, IL | 1979 | 156 | 993 | 4,164 | 451 | 993 | 4,615 | 5,608 | (1,932 | ) | 3,676 | 2,910 | |||||||||||||||||||||||||||||||||
Palm Springs Senior |
Garden | Mar-02 | Palm Springs, CA | 1981 | 116 | | 8,745 | 3,657 | | 12,402 | 12,402 | (1,782 | ) | 10,620 | 6,902 | |||||||||||||||||||||||||||||||||
Panorama Park |
Garden | Mar-02 | Bakersfield, CA | 1982 | 66 | 621 | 5,520 | 893 | 619 | 6,415 | 7,034 | (1,254 | ) | 5,780 | 2,331 |
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(1) | Initial Cost | Cost Capitalized | December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Property | Date | Year | Number | Buildings and | Subsequent to | Buildings and | (5) | Accumulated | Total Cost | |||||||||||||||||||||||||||||||||||||||
Property Name | Type | Consolidated | Location | Built | of Units | Land | Improvements | Consolidation | Land | Improvements | Total | Depreciation (AD) | Net of AD | Encumbrances | ||||||||||||||||||||||||||||||||||
Parc Chateau I |
Garden | Jan-06 | Lithonia, GA | 1973 | 86 | 592 | 1,442 | 324 | 592 | 1,766 | 2,358 | (1,744 | ) | 614 | 434 | |||||||||||||||||||||||||||||||||
Parc Chateau II |
Garden | Jan-06 | Lithonia, GA | 1974 | 88 | 596 | 2,965 | 284 | 596 | 3,249 | 3,845 | (2,522 | ) | 1,323 | 437 | |||||||||||||||||||||||||||||||||
Park Joplin Apartments |
Garden | Oct-07 | Joplin, MO | 1974 | 192 | 996 | 8,847 | 2 | 996 | 8,849 | 9,845 | (2,816 | ) | 7,029 | 3,395 | |||||||||||||||||||||||||||||||||
Park Place |
Mid Rise | Jun-05 | St Louis, MO | 1977 | 242 | 742 | 6,327 | 9,758 | 705 | 16,122 | 16,827 | (8,022 | ) | 8,805 | 9,572 | |||||||||||||||||||||||||||||||||
Park Vista |
Garden | Oct-05 | Anaheim, CA | 1958 | 392 | 6,155 | 25,929 | 4,463 | 6,155 | 30,392 | 36,547 | (6,356 | ) | 30,191 | 37,757 | |||||||||||||||||||||||||||||||||
Parkview |
Garden | Mar-02 | Sacramento, CA | 1980 | 97 | 1,041 | 2,880 | 7,019 | 1,145 | 9,795 | 10,940 | (1,456 | ) | 9,484 | 6,198 | |||||||||||||||||||||||||||||||||
Parkways, The |
Garden | Jun-04 | Chicago, IL | 1925 | 446 | 3,684 | 23,257 | 17,401 | 3,427 | 40,915 | 44,342 | (12,211 | ) | 32,131 | 21,927 | |||||||||||||||||||||||||||||||||
Patman Switch |
Garden | Jan-06 | Hughes Springs, TX | 1978 | 82 | 727 | 1,382 | 604 | 727 | 1,986 | 2,713 | (1,532 | ) | 1,181 | 1,229 | |||||||||||||||||||||||||||||||||
Pavilion |
High Rise | Mar-04 | Philadelphia, PA | 1976 | 296 | | 15,416 | 1,265 | | 16,681 | 16,681 | (4,111 | ) | 12,570 | 9,230 | |||||||||||||||||||||||||||||||||
Peachwood Place |
Garden | Oct-07 | Waycross, GA | 1999 | 72 | 163 | 2,254 | | 163 | 2,254 | 2,417 | (1,317 | ) | 1,100 | 737 | |||||||||||||||||||||||||||||||||
Pinebluff Village |
Mid Rise | Jan-06 | Salisbury, MD | 1980 | 151 | 1,112 | 7,177 | 685 | 1,112 | 7,862 | 8,974 | (5,627 | ) | 3,347 | 2,050 | |||||||||||||||||||||||||||||||||
Pinewood Place |
Garden | Mar-02 | Toledo, OH | 1979 | 99 | 420 | 1,698 | 1,234 | 420 | 2,932 | 3,352 | (1,229 | ) | 2,123 | 2,001 | |||||||||||||||||||||||||||||||||
Pleasant Hills |
Garden | Apr-05 | Austin, TX | 1982 | 100 | 1,188 | 2,631 | 3,502 | 1,229 | 6,092 | 7,321 | (1,810 | ) | 5,511 | 3,206 | |||||||||||||||||||||||||||||||||
Plummer Village |
Mid Rise | Mar-02 | North Hills, CA | 1983 | 75 | 624 | 2,647 | 1,613 | 667 | 4,217 | 4,884 | (1,670 | ) | 3,214 | 2,598 | |||||||||||||||||||||||||||||||||
Portner Place |
Town Home | Jan-06 | Washington, DC | 1980 | 48 | 697 | 3,753 | 92 | 697 | 3,845 | 4,542 | (287 | ) | 4,255 | 6,428 | |||||||||||||||||||||||||||||||||
Post Street Apartments |
High Rise | Jan-06 | Yonkers, NY | 1930 | 56 | 148 | 3,315 | 415 | 148 | 3,730 | 3,878 | (2,297 | ) | 1,581 | 1,599 | |||||||||||||||||||||||||||||||||
Pride Gardens |
Garden | Dec-97 | Flora, MS | 1975 | 76 | 102 | 1,071 | 1,628 | 102 | 2,699 | 2,801 | (1,454 | ) | 1,347 | 1,079 | |||||||||||||||||||||||||||||||||
Rancho California |
Garden | Jan-06 | Temecula, CA | 1984 | 55 | 488 | 5,462 | 256 | 488 | 5,718 | 6,206 | (2,797 | ) | 3,409 | 4,536 | |||||||||||||||||||||||||||||||||
Ridgewood (La Loma) |
Garden | Mar-02 | Sacramento, CA | 1980 | 75 | 684 | 227 | 7,367 | 718 | 7,560 | 8,278 | (910 | ) | 7,368 | 4,650 | |||||||||||||||||||||||||||||||||
Ridgewood Towers |
High Rise | Mar-02 | East Moline, IL | 1977 | 140 | 698 | 2,803 | 755 | 698 | 3,558 | 4,256 | (1,296 | ) | 2,960 | 1,552 | |||||||||||||||||||||||||||||||||
River Village |
High Rise | Jan-06 | Flint, MI | 1980 | 340 | 1,756 | 13,877 | 1,484 | 1,756 | 15,361 | 17,117 | (10,068 | ) | 7,049 | 7,370 | |||||||||||||||||||||||||||||||||
Rivers Edge |
Town Home | Jan-06 | Greenville, MI | 1983 | 49 | 311 | 2,097 | 283 | 311 | 2,380 | 2,691 | (1,643 | ) | 1,048 | 664 | |||||||||||||||||||||||||||||||||
Riverwoods |
High Rise | Jan-06 | Kankakee, IL | 1983 | 125 | 590 | 4,932 | 3,454 | 598 | 8,378 | 8,976 | (1,234 | ) | 7,742 | 5,077 | |||||||||||||||||||||||||||||||||
Rosedale Court Apartments |
Garden | Mar-04 | Dawson Springs, KY | 1981 | 40 | 194 | 1,177 | 180 | 194 | 1,357 | 1,551 | (548 | ) | 1,003 | 876 | |||||||||||||||||||||||||||||||||
Round Barn |
Garden | Mar-02 | Champaign, IL | 1979 | 156 | 947 | 5,134 | 5,729 | 934 | 10,876 | 11,810 | (2,312 | ) | 9,498 | 5,220 | |||||||||||||||||||||||||||||||||
Rutherford Park |
Town Home | Jan-06 | Hummelstown, PA | 1981 | 85 | 376 | 4,814 | 312 | 376 | 5,126 | 5,502 | (3,005 | ) | 2,497 | 2,841 | |||||||||||||||||||||||||||||||||
San Jose Apartments |
Garden | Sep-05 | San Antonio, TX | 1970 | 220 | 404 | 5,770 | 11,373 | 234 | 17,313 | 17,547 | (3,275 | ) | 14,272 | 5,271 | |||||||||||||||||||||||||||||||||
San Juan Del Centro |
Mid Rise | Sep-05 | Boulder, CO | 1971 | 150 | 243 | 7,110 | 12,551 | 438 | 19,466 | 19,904 | (3,729 | ) | 16,175 | 11,652 | |||||||||||||||||||||||||||||||||
Sandy Hill Terrace |
High Rise | Mar-02 | Norristown, PA | 1980 | 174 | 1,650 | 6,599 | 2,783 | 1,650 | 9,382 | 11,032 | (3,011 | ) | 8,021 | 3,598 | |||||||||||||||||||||||||||||||||
Sandy Springs |
Garden | Mar-05 | Macon, GA | 1979 | 74 | 366 | 1,522 | 1,403 | 366 | 2,925 | 3,291 | (1,703 | ) | 1,588 | 1,915 | |||||||||||||||||||||||||||||||||
School Street |
Mid Rise | Jan-06 | Taunton, MA | 1920 | 75 | 219 | 4,335 | 645 | 219 | 4,980 | 5,199 | (2,742 | ) | 2,457 | 2,625 | |||||||||||||||||||||||||||||||||
Sherman Hills |
High Rise | Jan-06 | Wilkes-Barre, PA | 1976 | 344 | 2,039 | 15,549 | 1,334 | 2,039 | 16,883 | 18,922 | (13,422 | ) | 5,500 | 3,028 | |||||||||||||||||||||||||||||||||
Shoreview |
Garden | Oct-99 | San Francisco, CA | 1976 | 156 | 1,498 | 19,071 | 18,283 | 1,476 | 37,376 | 38,852 | (13,248 | ) | 25,604 | 17,278 | |||||||||||||||||||||||||||||||||
South Bay Villa |
Garden | Mar-02 | Los Angeles, CA | 1981 | 80 | 663 | 2,770 | 4,354 | 1,352 | 6,435 | 7,787 | (3,290 | ) | 4,497 | 3,063 | |||||||||||||||||||||||||||||||||
Springfield Villas |
Garden | Oct-07 | Lockhart, TX | 1999 | 32 | | 1,153 | 9 | | 1,162 | 1,162 | | 1,162 | 855 | ||||||||||||||||||||||||||||||||||
St. George Villas |
Garden | Jan-06 | St. George, SC | 1984 | 40 | 86 | 1,025 | 95 | 86 | 1,120 | 1,206 | (787 | ) | 419 | 503 | |||||||||||||||||||||||||||||||||
Sterling Village |
Town Home | Mar-02 | San Bernadino, CA | 1983 | 80 | 549 | 3,459 | 2,722 | 188 | 6,542 | 6,730 | (1,470 | ) | 5,260 | 4,497 | |||||||||||||||||||||||||||||||||
Stonegate Apts |
Mid Rise | Jul-09 | Indianapolis, IN | 1920 | 52 | 255 | 3,610 | 6 | 255 | 3,616 | 3,871 | (733 | ) | 3,138 | 1,918 | |||||||||||||||||||||||||||||||||
Sumler Terrace |
Garden | Jan-06 | Norfolk, VA | 1976 | 126 | 215 | 4,400 | 503 | 215 | 4,903 | 5,118 | (3,643 | ) | 1,475 | 1,303 | |||||||||||||||||||||||||||||||||
Summit Oaks |
Town Home | Jan-06 | Burke, VA | 1980 | 50 | 382 | 4,930 | 288 | 382 | 5,218 | 5,600 | (1,103 | ) | 4,497 | 3,303 | |||||||||||||||||||||||||||||||||
Suntree |
Garden | Jan-06 | St. Johns, MI | 1980 | 121 | 403 | 6,488 | 658 | 403 | 7,146 | 7,549 | (4,472 | ) | 3,077 | 966 | |||||||||||||||||||||||||||||||||
Tabor Towers |
Mid Rise | Jan-06 | Lewisburg, WV | 1979 | 84 | 163 | 3,360 | 236 | 163 | 3,596 | 3,759 | (2,136 | ) | 1,623 | 1,934 | |||||||||||||||||||||||||||||||||
Tamarac Apartments I |
Garden | Nov-04 | Woodlands, TX | 1980 | 144 | 140 | 2,775 | 3,613 | 363 | 6,165 | 6,528 | (2,071 | ) | 4,457 | 4,188 | |||||||||||||||||||||||||||||||||
Tamarac Apartments II |
Garden | Nov-04 | Woodlands, TX | 1980 | 156 | 142 | 3,195 | 4,048 | 266 | 7,119 | 7,385 | (2,349 | ) | 5,036 | 4,537 | |||||||||||||||||||||||||||||||||
Terraces |
Mid Rise | Jan-06 | Kettering, OH | 1979 | 102 | 1,561 | 2,815 | 634 | 1,561 | 3,449 | 5,010 | (2,493 | ) | 2,517 | 2,483 | |||||||||||||||||||||||||||||||||
Terry Manor |
Mid Rise | Oct-05 | Los Angeles, CA | 1977 | 170 | 1,775 | 5,848 | 6,648 | 1,997 | 12,274 | 14,271 | (4,379 | ) | 9,892 | 6,961 | |||||||||||||||||||||||||||||||||
Tompkins Terrace |
Garden | Oct-02 | Beacon, NY | 1974 | 193 | 872 | 6,827 | 12,128 | 872 | 18,955 | 19,827 | (3,124 | ) | 16,703 | 8,536 | |||||||||||||||||||||||||||||||||
Trestletree Village |
Garden | Mar-02 | Atlanta, GA | 1981 | 188 | 1,150 | 4,655 | 1,500 | 1,150 | 6,155 | 7,305 | (2,119 | ) | 5,186 | 2,856 | |||||||||||||||||||||||||||||||||
University Square |
High Rise | Mar-05 | Philadelphia, PA | 1978 | 442 | 702 | 12,201 | 12,209 | 702 | 24,410 | 25,112 | (8,361 | ) | 16,751 | 13,634 | |||||||||||||||||||||||||||||||||
Van Nuys Apartments |
High Rise | Mar-02 | Los Angeles, CA | 1981 | 299 | 4,253 | 21,226 | 19,594 | 4,219 | 40,854 | 45,073 | (5,581 | ) | 39,492 | 20,870 | |||||||||||||||||||||||||||||||||
Victory Square |
Garden | Mar-02 | Canton, OH | 1975 | 81 | 215 | 889 | 550 | 215 | 1,439 | 1,654 | (633 | ) | 1,021 | 850 | |||||||||||||||||||||||||||||||||
Village Oaks |
Mid Rise | Jan-06 | Catonsville, MD | 1980 | 181 | 2,127 | 5,188 | 1,775 | 2,127 | 6,963 | 9,090 | (4,748 | ) | 4,342 | 4,479 | |||||||||||||||||||||||||||||||||
Village of Kaufman |
Garden | Mar-05 | Kaufman, TX | 1981 | 68 | 370 | 1,606 | 628 | 370 | 2,234 | 2,604 | (747 | ) | 1,857 | 1,851 | |||||||||||||||||||||||||||||||||
Vintage Crossing |
Town Home | Mar-04 | Cuthbert, GA | 1982 | 50 | 188 | 1,058 | 553 | 188 | 1,611 | 1,799 | (917 | ) | 882 | 1,639 | |||||||||||||||||||||||||||||||||
Vista Park Chino |
Garden | Mar-02 | Chino, CA | 1983 | 40 | 380 | 1,521 | 388 | 380 | 1,909 | 2,289 | (693 | ) | 1,596 | 1,446 | |||||||||||||||||||||||||||||||||
Vistula Heritage Village |
Garden | Oct-08 | Toledo, OH | 1930 | 250 | 1,312 | 20,635 | | 1,312 | 20,635 | 21,947 | (8,119 | ) | 13,828 | 12,716 | |||||||||||||||||||||||||||||||||
Wah Luck House |
High Rise | Jan-06 | Washington, DC | 1982 | 153 | | 8,690 | 476 | | 9,166 | 9,166 | (2,407 | ) | 6,759 | 9,147 | |||||||||||||||||||||||||||||||||
Walnut Hills |
High Rise | Jan-06 | Cincinnati, OH | 1983 | 198 | 888 | 5,608 | 5,114 | 826 | 10,784 | 11,610 | (1,788 | ) | 9,822 | 5,645 | |||||||||||||||||||||||||||||||||
Wasco Arms |
Garden | Mar-02 | Wasco, CA | 1982 | 78 | 625 | 2,519 | 1,025 | 625 | 3,544 | 4,169 | (1,368 | ) | 2,801 | 3,109 | |||||||||||||||||||||||||||||||||
Washington Square West |
Mid Rise | Sep-04 | Philadelphia, PA | 1982 | 132 | 555 | 11,169 | 5,854 | 582 | 16,996 | 17,578 | (7,665 | ) | 9,913 | 3,888 | |||||||||||||||||||||||||||||||||
Westwood Terrace |
Mid Rise | Mar-02 | Moline, IL | 1976 | 97 | 720 | 3,242 | 586 | 720 | 3,828 | 4,548 | (1,237 | ) | 3,311 | 1,652 | |||||||||||||||||||||||||||||||||
White Cliff |
Garden | Mar-02 | Lincoln Heights, OH | 1977 | 72 | 215 | 938 | 419 | 215 | 1,357 | 1,572 | (567 | ) | 1,005 | 1,003 | |||||||||||||||||||||||||||||||||
Whitefield Place |
Garden | Apr-05 | San Antonio, TX | 1980 | 80 | 223 | 3,151 | 2,550 | 219 | 5,705 | 5,924 | (2,054 | ) | 3,870 | 2,260 | |||||||||||||||||||||||||||||||||
Wickford |
Garden | Mar-04 | Henderson, NC | 1983 | 44 | 247 | 946 | 123 | 247 | 1,069 | 1,316 | (436 | ) | 880 | 1,423 | |||||||||||||||||||||||||||||||||
Wilderness Trail |
High Rise | Mar-02 | Pineville, KY | 1983 | 124 | 1,010 | 4,048 | 674 | 1,010 | 4,722 | 5,732 | (1,223 | ) | 4,509 | 4,478 | |||||||||||||||||||||||||||||||||
Wilkes Towers |
High Rise | Mar-02 | North Wilkesboro, NC | 1981 | 72 | 410 | 1,680 | 494 | 410 | 2,174 | 2,584 | (723 | ) | 1,861 | 1,875 | |||||||||||||||||||||||||||||||||
Willow Wood |
Garden | Mar-02 | North Hollywood, CA | 1984 | 19 | 1,051 | 840 | 193 | 1,051 | 1,033 | 2,084 | (308 | ) | 1,776 | 1,068 |
77
(2) | (3) | |||||||||||||||||||||||||||||||||||||||||||||||
(1) | Initial Cost | Cost Capitalized | December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Property | Date | Year | Number | Buildings and | Subsequent to | Buildings and | (5) | Accumulated | Total Cost | |||||||||||||||||||||||||||||||||||||||
Property Name | Type | Consolidated | Location | Built | of Units | Land | Improvements | Consolidation | Land | Improvements | Total | Depreciation (AD) | Net of AD | Encumbrances | ||||||||||||||||||||||||||||||||||
Winnsboro Arms |
Garden | Jan-06 | Winnsboro, SC | 1978 | 60 | 272 | 1,697 | 253 | 272 | 1,950 | 2,222 | (1,508 | ) | 714 | 182 | |||||||||||||||||||||||||||||||||
Winter Gardens |
High Rise | Mar-04 | St Louis, MO | 1920 | 112 | 300 | 3,072 | 4,448 | 300 | 7,520 | 7,820 | (1,334 | ) | 6,486 | 3,796 | |||||||||||||||||||||||||||||||||
Woodcrest |
Garden | Dec-97 | Odessa, TX | 1972 | 80 | 41 | 229 | 674 | 41 | 903 | 944 | (708 | ) | 236 | 443 | |||||||||||||||||||||||||||||||||
Woodland |
Garden | Jan-06 | Spartanburg, SC | 1972 | 100 | 182 | 663 | 1,379 | 182 | 2,042 | 2,224 | (491 | ) | 1,733 | | |||||||||||||||||||||||||||||||||
Woodland Hills |
Garden | Oct-05 | Jackson, MI | 1980 | 125 | 541 | 3,875 | 4,266 | 321 | 8,361 | 8,682 | (2,727 | ) | 5,955 | 3,644 | |||||||||||||||||||||||||||||||||
Total
Affordable Properties: |
20,845 | 119,679 | 881,432 | 442,857 | 118,882 | 1,325,086 | 1,443,968 | (484,724 | ) | 959,244 | 706,666 | |||||||||||||||||||||||||||||||||||||
Other (4) |
| 74 | 2,470 | 2,465 | 2,107 | 2,903 | 5,010 | (2,490 | ) | 2,520 | | |||||||||||||||||||||||||||||||||||||
Total
Continuing Operations |
90,222 | 2,090,713 | 4,702,013 | 2,597,713 | 2,148,389 | 7,242,051 | 9,390,440 | (2,595,049 | ) | 6,795,391 | 5,398,091 | |||||||||||||||||||||||||||||||||||||
Discontinued Operations: |
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Conventional Properties: |
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Atriums of Plantation |
Mid Rise | Aug-98 | Plantation, FL | 1979 | 210 | 1,807 | 10,385 | 2,833 | 1,807 | 13,218 | 15,025 | (5,151 | ) | 9,874 | 5,780 | |||||||||||||||||||||||||||||||||
Citrus Grove |
Garden | Jun-98 | Redlands, CA | 1985 | 198 | 1,118 | 6,642 | 2,186 | 1,118 | 8,828 | 9,946 | (3,983 | ) | 5,963 | 3,261 | |||||||||||||||||||||||||||||||||
Defoors Crossing |
Garden | Jan-06 | Atlanta, GA | 1987 | 60 | 348 | 957 | 392 | 348 | 1,349 | 1,697 | (1,213 | ) | 484 | | |||||||||||||||||||||||||||||||||
Fairway |
Garden | Jan-00 | Plano, TX | 1978 | 256 | 2,961 | 5,137 | 5,788 | 2,961 | 10,925 | 13,886 | (5,794 | ) | 8,092 | 8,885 | |||||||||||||||||||||||||||||||||
Glenbridge Manors |
Garden | Sep-03 | Cincinnati, OH | 1978 | 274 | 1,030 | 17,447 | 14,108 | 1,031 | 31,554 | 32,585 | (7,012 | ) | 25,573 | 16,820 | |||||||||||||||||||||||||||||||||
Highland Ridge |
Garden | Sep-04 | Atlanta, GA | 1984 | 219 | 1,225 | 6,174 | 5,145 | 1,242 | 11,302 | 12,544 | (4,605 | ) | 7,939 | 6,100 | |||||||||||||||||||||||||||||||||
Homestead |
Garden | Apr-05 | East Lansing, MI | 1986 | 168 | 1,565 | 8,200 | 761 | 1,566 | 8,960 | 10,526 | (3,878 | ) | 6,648 | 3,372 | |||||||||||||||||||||||||||||||||
Sandpiper Cove |
Garden | Dec-97 | Boynton Beach, FL | 1987 | 416 | 3,511 | 21,396 | 7,141 | 3,511 | 28,537 | 32,048 | (11,039 | ) | 21,009 | 29,425 | |||||||||||||||||||||||||||||||||
Sienna Bay |
Garden | Apr-00 | St. Petersburg, FL | 1984 | 276 | 1,737 | 9,778 | 10,702 | 1,737 | 20,480 | 22,217 | (10,277 | ) | 11,940 | 10,630 | |||||||||||||||||||||||||||||||||
Solana Vista |
Garden | Dec-97 | Bradenton, FL | 1984 | 200 | 1,276 | 7,170 | 6,872 | 1,276 | 14,042 | 15,318 | (5,449 | ) | 9,869 | 7,865 | |||||||||||||||||||||||||||||||||
Stoney Brook |
Garden | Nov-96 | Houston, TX | 1972 | 113 | 275 | 1,865 | 1,931 | 275 | 3,796 | 4,071 | (1,215 | ) | 2,856 | 1,797 | |||||||||||||||||||||||||||||||||
Summit Creek |
Garden | May-98 | Austin, TX | 1985 | 164 | 1,211 | 6,037 | 2,591 | 1,211 | 8,628 | 9,839 | (3,285 | ) | 6,554 | 5,670 | |||||||||||||||||||||||||||||||||
Talbot Woods |
Garden | Sep-04 | Middleboro, MA | 1972 | 121 | 5,852 | 4,719 | 2,026 | 5,852 | 6,745 | 12,597 | (2,150 | ) | 10,447 | 6,203 | |||||||||||||||||||||||||||||||||
Tar River Estates |
Garden | Oct-99 | Greenville, NC | 1969 | 220 | 1,558 | 14,298 | 3,740 | 1,558 | 18,038 | 19,596 | (7,601 | ) | 11,995 | 3,960 | |||||||||||||||||||||||||||||||||
Tierra Palms |
Garden | Jan-06 | Norwalk, CA | 1970 | 144 | 6,441 | 6,807 | 609 | 6,441 | 7,416 | 13,857 | (855 | ) | 13,002 | 10,777 | |||||||||||||||||||||||||||||||||
Village Green |
Garden | Oct-02 | Altamonte Springs, FL | 1970 | 164 | 608 | 6,618 | 2,514 | 608 | 9,132 | 9,740 | (4,386 | ) | 5,354 | 6,510 | |||||||||||||||||||||||||||||||||
Wilson Acres |
Garden | Apr-06 | Greenville, NC | 1979 | 146 | 1,175 | 3,943 | 962 | 1,485 | 4,595 | 6,080 | (866 | ) | 5,214 | 2,743 | |||||||||||||||||||||||||||||||||
Total
Conventional Properties: |
3,349 | 33,698 | 137,573 | 70,301 | 34,027 | 207,545 | 241,572 | (78,759 | ) | 162,813 | 129,800 | |||||||||||||||||||||||||||||||||||||
Affordable Properties: |
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Baldwin Oaks |
Mid Rise | Oct-99 | Parsippany ,NJ | 1980 | 251 | 746 | 8,516 | 1,998 | 746 | 10,514 | 11,260 | (6,245 | ) | 5,015 | 12,972 | |||||||||||||||||||||||||||||||||
Baldwin Towers |
High Rise | Jan-06 | Pittsburgh, PA | 1983 | 99 | 398 | 5,256 | 202 | 398 | 5,458 | 5,856 | (4,002 | ) | 1,854 | 1,458 | |||||||||||||||||||||||||||||||||
Bloomsburg Towers |
Mid Rise | Jan-06 | Bloomsburg, PA | 1981 | 75 | 1 | 4,128 | 351 | 1 | 4,479 | 4,480 | (2,761 | ) | 1,719 | 1,553 | |||||||||||||||||||||||||||||||||
Campbell Heights |
High Rise | Oct-02 | Washington, D.C. | 1978 | 171 | 750 | 6,719 | 859 | 750 | 7,578 | 8,328 | (3,062 | ) | 5,266 | 15,449 | |||||||||||||||||||||||||||||||||
Cherry Ridge Terrace |
Garden | Mar-02 | Northern Cambria, PA | 1983 | 62 | 372 | 1,490 | 906 | 372 | 2,396 | 2,768 | (852 | ) | 1,916 | 795 | |||||||||||||||||||||||||||||||||
Hillside Village |
Town Home | Jan-06 | Catawissa, PA | 1981 | 50 | 31 | 2,643 | 186 | 31 | 2,829 | 2,860 | (1,795 | ) | 1,065 | 1,089 | |||||||||||||||||||||||||||||||||
Hilltop |
Garden | Jan-06 | Duquesne, PA | 1975 | 152 | 1,271 | 6,194 | 722 | 1,271 | 6,916 | 8,187 | (5,198 | ) | 2,989 | 2,110 | |||||||||||||||||||||||||||||||||
Hudson Terrace |
Garden | Jan-06 | Hudson, NY | 1973 | 168 | 647 | 5,025 | 584 | 647 | 5,609 | 6,256 | (3,813 | ) | 2,443 | 1,044 | |||||||||||||||||||||||||||||||||
Lodge Run |
Mid Rise | Jan-06 | Portage, PA | 1983 | 31 | 274 | 1,211 | 377 | 274 | 1,588 | 1,862 | (1,259 | ) | 603 | 363 | |||||||||||||||||||||||||||||||||
Morrisania II |
High Rise | Jan-06 | Bronx, NY | 1979 | 203 | 659 | 15,783 | 1,710 | 659 | 17,493 | 18,152 | (10,840 | ) | 7,312 | 8,144 | |||||||||||||||||||||||||||||||||
New Vistas I |
Garden | Jan-06 | Chicago, IL | 1925 | 148 | 1,448 | 6,121 | 380 | 1,448 | 6,501 | 7,949 | (5,577 | ) | 2,372 | 1,386 | |||||||||||||||||||||||||||||||||
Oxford Terrace IV |
Town Home | Oct-07 | Indianapolis, IN | 1994 | 48 | 247 | 1,410 | 607 | 247 | 2,017 | 2,264 | (1,057 | ) | 1,207 | 1,261 | |||||||||||||||||||||||||||||||||
Spring Manor |
Mid Rise | Jan-06 | Holidaysburg, PA | 1983 | 51 | 608 | 2,083 | 425 | 608 | 2,508 | 3,116 | (2,168 | ) | 948 | 631 | |||||||||||||||||||||||||||||||||
Stonegate Village |
Garden | Oct-00 | New Castle, IN | 1970 | 122 | 313 | 1,895 | 1,342 | 308 | 3,242 | 3,550 | (1,344 | ) | 2,206 | 284 | |||||||||||||||||||||||||||||||||
Total
Affrodable Properties: |
1,631 | 7,765 | 68,474 | 10,649 | 7,760 | 79,128 | 86,888 | (49,973 | ) | 36,915 | 48,539 | |||||||||||||||||||||||||||||||||||||
Other (4) |
| | | 78 | 1 | 77 | 78 | (63 | ) | 15 | | |||||||||||||||||||||||||||||||||||||
Total
Discontinued Operations |
4,980 | 41,463 | 206,047 | 81,028 | 41,788 | 286,750 | 328,538 | (128,795 | ) | 199,743 | 178,339 | |||||||||||||||||||||||||||||||||||||
Total
Continuing and Discontinued Operations |
95,202 | 2,132,176 | 4,908,060 | 2,678,741 | 2,190,177 | 7,528,801 | 9,718,978 | (2,723,844 | ) | 6,995,134 | 5,576,430 | |||||||||||||||||||||||||||||||||||||
(1) | Date we acquired the property or first consolidated the partnership which owns the property. |
|
(2) | Initial cost includes the tendering costs to acquire the noncontrolling interest share of our
consolidated real estate partnerships. |
|
(3) | Costs capitalized subsequent to consolidation includes costs capitalized since acquisition or
first consolidation of the partnership/property. |
|
(4) | Other includes land parcels, commercial properties and other related costs. |
|
(5) | The aggregate cost of land and depreciable propertyfor federal income tax purposes was
approximately $8.0 billion at December 31, 2009. |
78
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
SCHEDULE III: REAL ESTATE AND ACCUMULATED DEPRECIATION
For the Years Ended December 31, 2009, 2008 and 2007
(In Thousands)
SCHEDULE III: REAL ESTATE AND ACCUMULATED DEPRECIATION
For the Years Ended December 31, 2009, 2008 and 2007
(In Thousands)
2009 | 2008 | 2007 | ||||||||||
Real Estate |
||||||||||||
Balance at beginning of year |
$ | 11,000,496 | $ | 12,420,200 | $ | 12,011,693 | ||||||
Additions during the year: |
||||||||||||
Newly consolidated assets and
acquisition of limited
partnership interests (1) |
19,683 | 31,447 | 31,572 | |||||||||
Acquisitions |
| 107,445 | 233,059 | |||||||||
Capital expenditures |
275,444 | 665,233 | 689,719 | |||||||||
Deductions during the year: |
||||||||||||
Casualty and other write-offs (2) |
(43,134 | ) | (130,595 | ) | (24,594 | ) | ||||||
Sales |
(1,533,511 | ) | (2,093,234 | ) | (521,249 | ) | ||||||
Balance at end of year |
$ | 9,718,978 | $ | 11,000,496 | $ | 12,420,200 | ||||||
Accumulated Depreciation |
||||||||||||
Balance at beginning of year |
$ | 2,815,497 | $ | 3,047,716 | $ | 2,901,414 | ||||||
Additions during the year: |
||||||||||||
Depreciation |
478,550 | 497,395 | 477,725 | |||||||||
Newly consolidated assets and
acquisition of limited
partnership interests (1) |
(2,763 | ) | (22,256 | ) | (128,272 | ) | ||||||
Deductions during the year: |
||||||||||||
Casualty and other write-offs |
(5,200 | ) | (1,838 | ) | (5,280 | ) | ||||||
Sales |
(562,240 | ) | (705,520 | ) | (197,871 | ) | ||||||
Balance at end of year |
$ | 2,723,844 | $ | 2,815,497 | $ | 3,047,716 | ||||||
(1) | Includes the effect of newly consolidated assets, acquisition of limited
partnership interests and related activity. |
|
(2) | Casualty and other write-offs in 2008 include impairments totaling $91.1 million
related to our Lincoln Place and Pacific Bay Vistas properties. |
79