Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements (Tables)

v2.4.0.8
Fair Value Measurements (Tables)
6 Months Ended
Jun. 30, 2013
Fair Value Disclosures [Abstract]  
Schedule of fair value assets and liabilities measured on recurring basis
The table below sets forth financial assets and liabilities of COPT and its subsidiaries that are accounted for at fair value on a recurring basis as of June 30, 2013 and the hierarchy level of inputs used in measuring their respective fair values under applicable accounting standards (in thousands):
Description
 
Quoted Prices in
Active Markets for
Identical Assets(Level 1)
 
Significant Other
Observable Inputs(Level 2)
 
Significant
Unobservable Inputs(Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Marketable securities in deferred compensation plan (1)
 
 

 
 

 
 

 
 

Mutual funds
 
$
6,649

 
$

 
$

 
$
6,649

Common stocks
 
216

 

 

 
216

Other
 
211

 

 

 
211

Common stock (1)
 
1,825

 

 

 
1,825

Interest rate derivatives (2)
 

 
6,963

 

 
6,963

Warrants to purchase common stock (2)
 

 
299

 

 
299

Assets
 
$
8,901

 
$
7,262

 
$

 
$
16,163

Liabilities:
 
 

 
 

 
 

 
 

Deferred compensation plan liability (3)
 
$
7,076

 
$

 
$

 
$
7,076

Interest rate derivatives
 

 
3,556

 

 
3,556

Liabilities
 
$
7,076

 
$
3,556

 
$

 
$
10,632

Redeemable noncontrolling interest
 
$

 
$

 
$
15,571

 
$
15,571


(1) Included in the line entitled “restricted cash and marketable securities” on COPT’s consolidated balance sheet.
(2) Included in the line entitled “prepaid expenses and other assets” on COPT’s consolidated balance sheet.
(3) Included in the line entitled “other liabilities” on COPT’s consolidated balance sheet.
The table below sets forth financial assets and liabilities of COPLP and its subsidiaries that are accounted for at fair value on a recurring basis as of June 30, 2013 and the hierarchy level of inputs used in measuring their respective fair values under applicable accounting standards (in thousands):
Description
 
Quoted Prices in
Active Markets for
Identical Assets(Level 1)
 
Significant Other
Observable Inputs(Level 2)
 
Significant
Unobservable Inputs(Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Common stock (1)
 
$
1,825

 
$

 
$

 
$
1,825

Interest rate derivatives (2)
 

 
6,963

 

 
6,963

Warrants to purchase common stock (2)
 

 
299

 

 
299

Assets
 
$
1,825

 
$
7,262

 
$

 
$
9,087

Liabilities:
 
 

 
 

 
 

 
 

Interest rate derivatives
 
$

 
$
3,556

 
$

 
$
3,556

Redeemable noncontrolling interest
 
$

 
$

 
$
15,571

 
$
15,571


(1) Included in the line entitled “restricted cash and marketable securities” on COPLP’s consolidated balance sheet.
(2) Included in the line entitled “prepaid expenses and other assets” on COPLP’s consolidated balance sheet.
Schedule of fair value hierarchy of impaired properties and other assets associated with such properties
The table below sets forth the fair value hierarchy of the valuation technique used by us in determining the fair value of the properties (dollars in thousands):
 
 
Quoted Prices in
 
 
 
Significant
 
 
 
Impairment Losses Recognized
 
 
Active Markets for
 
Significant Other
 
Unobservable
 
 
 
Three Months
 
Six Months
 
 
Identical Assets
 
Observable Inputs
 
Inputs
 
 
 
Ended
 
Ended
Description
 
(Level 1)
 
(Level 2)
 
(Level 3)
 
Total
 
June 30, 2013
 
June 30, 2013
Assets (1):
 
 

 
 

 
 

 
 

 
 
 
 
Properties, net
 
$

 
$

 
$
113,144

 
$
113,144

 
$
7,195

 
$
9,052


(1) Reflects balance sheet classifications of assets at time of fair value measurement, excluding the effect of held for sale classifications.

The table below sets forth the fair value hierarchy of the valuation techniques used by us in determining such fair values (dollars in thousands):
 
 
Quoted Prices in
 
 
 
Significant
 
 
 
Impairment Losses Recognized (1)
 
 
Active Markets for
 
Significant Other
 
Unobservable
 
 
 
Three Months
 
Six Months
 
 
Identical Assets
 
Observable Inputs
 
Inputs
 
 
 
Ended
 
Ended
Description
 
(Level 1)
 
(Level 2)
 
(Level 3)
 
Total
 
June 30, 2012
 
June 30, 2012
Assets (2):
 
 

 
 

 
 

 
 

 
 

 
 
Properties, net
 
$

 
$

 
$
202,250

 
$
202,250

 
$
2,214

 
7,693


(1) Represents impairment losses, excluding exit costs incurred of $105,000 for the three months ended June 30, 2012 and $1.2 million for the six months ended June 30, 2012.
(2) Reflects balance sheet classifications of assets at time of fair value measurement, excluding the effect of held for sale classifications.
Schedule of quantitative information about significant unobservable inputs used for Level 3 fair value measurements
The table below sets forth quantitative information about significant unobservable inputs used for the Level 3 fair value measurements reported above (dollars in thousands):
Description
 
Fair Value on 
Measurement Date
 
Valuation Technique
 
 Unobservable Input
 
Range (Weighted Average)
Property on which impairment loss was recognized
 
$
113,144

 
Bids for property indicative of value
 
Indicative bids (1)
 
(1)

(1) This fair value measurement was developed by a third party source, subject to our corroboration for reasonableness.
The table below sets forth quantitative information about significant unobservable inputs used for the Level 3 fair value measurements reported above (dollars in thousands):
Description
 
Fair Value on 
Measurement Date
 
Valuation Technique
 
 Unobservable Input
 
Range (Weighted Average)
Properties on which impairment losses were recognized
 
$
202,250

 
Bid for properties indicative of value
 
Indicative bid (1)
 
(1)
 
 
 
 
Contract of sale
 
Contract price (1)
 
(1)
 
 
 
 
Discounted cash flow
 
Discount rate
 
11.0% (2)
 
 
 
 
 
 
Terminal capitalization rate
 
9.0% (2)
 
 
 
 
 
 
Market rent growth rate
 
3.0% (2)
 
 
 
 
 
 
Expense growth rate
 
3.0% (2)
 
 
 
 
Yield Analysis
 
Yield
 
12% (2)
 
 
 
 
 
 
Market rent rate
 
$8.50 (2)
 
 
 
 
 
 
Leasing costs
 
$20.00 per square foot (2)
(1) These fair value measurements were developed by third party sources, subject to our corroboration for reasonableness.
(2) Only one value applied for this unobservable input.