Annual report pursuant to Section 13 and 15(d)

Prepaid Expenses and Other Assets, Net

v3.19.3.a.u2
Prepaid Expenses and Other Assets, Net
 12 Months Ended
Dec. 31, 2019
Prepaid Expense and Other Assets [Abstract]  
Prepaid Expenses and Other Assets, Net Prepaid Expenses and Other Assets, Net
 
Prepaid expenses and other assets, net consisted of the following (in thousands):
 
 
December 31,
 
2019
 
2018
Lease incentives, net
$
28,433

 
$
21,258

Prepaid expenses
18,835

 
25,658

Construction contract costs in excess of billings
17,223

 
3,189

Furniture, fixtures and equipment, net (1)
7,823

 
8,630

Non-real estate equity investments
6,705

 
5,940

Deferred financing costs, net (2)
3,633

 
4,733

Restricted cash
3,397

 
3,884

Deferred tax asset, net
2,328

 
2,084

Interest rate derivatives
23

 
5,617

Other assets
4,616

 
6,337

Total for COPLP and subsidiaries
93,016

 
87,330

Marketable securities in deferred compensation plan
3,060

 
3,868

Total for COPT and subsidiaries
$
96,076

 
$
91,198

 

(1) Includes $1.2 million in finance right-of-use assets as of December 31, 2019.
(2) Represents deferred costs, net of accumulated amortization, attributable to our Revolving Credit Facility and interest rate derivatives.

Deferred tax asset, net reported above includes the following tax effects of temporary differences and carry forwards of our TRS (in thousands):
 
December 31,
 
2019
 
2018
Operating loss carry forward
$
2,885

 
$
4,354

Property
(77
)
 
427

Share-based compensation
—

 
28

Accrued payroll
—

 
2

Valuation allowance
(480
)
 
(2,727
)
Deferred tax asset, net
$
2,328

 
$
2,084



We recognize a valuation allowance on our deferred tax asset if we believe all or some portion of the asset may not be realized. An increase or decrease in the valuation allowance resulting from a change in circumstances that causes a change in our judgment about the realizability of our deferred tax asset is included in income. The decrease in deferred tax asset valuation allowance reflected above was due to higher projected taxable income in our TRS resulting from certain construction projects. We believe it is more likely than not that the results of future operations in our TRS will generate sufficient taxable income to realize our December 31, 2019 net deferred tax asset.