Annual report pursuant to Section 13 and 15(d)

Investments in Real Estate

v3.22.4
Investments in Real Estate
 12 Months Ended
Dec. 31, 2022
Real Estate [Abstract]  
Investments in Real Estate Investments in Real Estate
The following comprise the Company’s real estate investments:
Successor
Predecessor
December 31, 2022 December 31, 2021
Buildings and improvements $ 3,592,688  $ 2,341,257 
Land 1,921,093  763,961 
Development in progress 181,230  — 
Land held for development —  78,991 
Investments in real estate 5,695,011  3,184,209 
Accumulated depreciation (138,216) (1,178,341)
Investments in real estate, net $ 5,556,795  $ 2,005,868 
Depreciation expense of investments in real estate was $141,027, $48,884, $90,176, and $93,265 for the period from July 20, 2022 through December 31, 2022, the period from January 1, 2022 through July 19, 2022, the year ended December 31, 2021, and the year ended December 31, 2020, respectively.
We have a 95.0% interest in a joint venture that owns Highgate at The Mile, a 395-unit multifamily apartment complex located in Tysons, Virginia (“The Mile”). The remaining 5.0% interest in the joint venture is held by the JV Partner. We consolidate the joint venture that owns The Mile and as such, the consolidated real estate assets and activities related to this joint venture are included in the table above. Refer to Note 2 — Summary of Significant Accounting Policies for VIE determination.
Acquisitions
The following table summarizes the Company’s acquisition activity:
Successor Predecessor
Period from July 20, 2022 through December 31, 2022 Period from January 1, 2022 through July 19, 2022 Year Ended December 31, 2021 Year Ended December 31, 2020
Operating properties acquired —  —  8  2 
Square feet —  —  859,000  320,000 
Total purchase price $ —  $ —  $ 148,868  $ 60,095 
The purchase price of the above acquisition, including the associated transaction costs, was allocated to the assets acquired and liabilities assumed based on their relative fair values as of the acquisition date, and are summarized below:
Successor
Predecessor
2022 Acquisitions 2022 Acquisitions 2021 Acquisitions 2020 Acquisitions
Building $ —  $ —  $ 111,412  $ 24,868 
Site improvements —  —  8,670  1,075 
Land —  —  22,591  30,261 
Tenant improvements —  —  3,629  1,225 
Other —  —  1,400  2,590 
Allocated purchase price $ —  $ —  $ 147,702  $ 60,019 
Transaction costs of $—, $—, $370, and $446 were capitalized and included within the allocated purchase price for the period from July 20, 2022 through December 31, 2022, the period from January 1, 2022 through July 19, 2022, the year ended December 31, 2021, and the year ended December 31, 2020, respectively.
Dispositions
The following table summarizes the Company’s dispositions:
Successor Predecessor
Period from July 20, 2022 through December 31, 2022 Period from January 1, 2022 through July 19, 2022 Year Ended December 31, 2021 Year Ended December 31, 2020
Number of buildings 168  40  22  3 
Number of land parcels —  1  —  — 
Net proceeds1
$ 1,295,217  $ 236,362  $ 400,993  $ 40,711 
Gain on sale of real estate, net $ —  $ 157,022  $ 359,875  $ 27,273 
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¹ For the Successor period from July 20, 2022 through December 31, 2022, the Non-Core Portfolio disposition was a non-cash transaction. For additional information, refer to Note 1 — Description of Business and Note 14 — Supplemental Cash Flow Disclosures.
Development
The Company completed the construction and placed into service the following buildings:
Successor Predecessor
Period from July 20, 2022 through December 31, 2022 Period from January 1, 2022 through July 19, 2022 Year Ended December 31, 2021 Year Ended December 31, 2020
Buildings placed into service —  —  1  — 
Square feet —  —  83,000  — 
Total costs incurred1
$ —  $ —  $ 8,062  $ — 
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¹ Total costs incurred represent the Company’s cumulative spend on development activity relating to the properties placed into service in the above periods, including any allocation of purchase price resulting from acquisition of properties under development.
Assets and Liabilities Held for Sale
In the normal course of business, the Company identifies non-strategic assets for sale. The Company separately classifies properties held for sale in its Consolidated Financial Statements. Real estate investments to be disposed of are reported at the lower of carrying amount or estimated fair value, less costs to sell. Once an asset is classified as held for sale, depreciation and amortization expense is no longer recorded. Once a liability is classified as held for sale, amortization of below market leases is no longer recorded.
The following table is a summary of the assets and liabilities of the Company’s zero and 12 properties classified as held for sale as of December 31, 2022 and December 31, 2021, respectively:
Successor Predecessor
December 31, 2022 December 31, 2021
Assets:
Investments in real estate, net $ —  $ 33,607 
Prepaid expenses and other assets —  2 
Total assets held for sale $ —  $ 33,609