COPT Defense Properties Quarterly report [Sections 13 or 15(d)]

Quarterly report [Sections 13 or 15(d)]

Real Estate Joint Ventures

Real Estate Joint Ventures

3 Months Ended

Mar. 31, 2026

Equity Method Investments and Joint Ventures [Abstract]

Consolidated Real Estate Joint Ventures

The table below presents information pertaining to our investments in consolidated real estate joint ventures, which are each variable interest entities (dollars in thousands):


		Nominal Ownership %		March 31, 2026
	Date Formed			Total Assets		Encumbered Assets		Total Liabilities		Mortgage Debt
Entity			Location
LW Redstone Company, LLC (1)	3/23/2010	85%	Huntsville, AL	$	776,748	$	50,397	$	65,121	$	—
Stevens Investors, LLC	8/11/2015	95%	Washington, DC	141,689		—		1,270		—
M Square Associates, LLC	6/26/2007	50%	College Park, MD	106,251		54,046		50,308		45,866
				$	1,024,688	$	104,443	$	116,699	$	45,866

(1)We fund all capital requirements. Our partner receives distributions of $1.2 million of annual operating cash flows, plus certain fees for leasing and development, and we receive the remainder.

Unconsolidated Real Estate Joint Ventures

The table below presents information pertaining to our investments in unconsolidated real estate joint ventures accounted for using the equity method of accounting (dollars in thousands):


	Date Formed	Nominal Ownership %	Number of Properties	Carrying Value of Investment (1)
Entity				March 31, 2026		December 31, 2025
Redshift JV LLC	1/10/2023	10%	3	$	20,196	$	20,767
BREIT COPT DC JV LLC	6/20/2019	10%	9	8,970		8,941
Quark JV LLC	12/14/2022	10%	2	6,652		6,660
B RE COPT DC JV III LLC	6/2/2021	10%	2	(707)		(600)
B RE COPT DC JV II LLC (2)	10/30/2020	10%	8	(23,306)		(22,243)
			24	$	11,805	$	13,525

(1)Included $35.8 million and $36.4 million reported in “investment in unconsolidated real estate joint ventures” and $24.0 million and $22.8 million for investments with deficit balances reported in “other liabilities” on our consolidated balance sheets as of March 31, 2026 and December 31, 2025, respectively. Investments with deficit balances are attributable to JV distributions of nonrecourse debt refinancing proceeds in excess of our equity in B RE COPT DC JV III LLC and B RE COPT DC JV II LLC; we are obligated to fund our share of future cash flow requirements, if any, of these joint ventures.

(2)Our investment in B RE COPT DC JV II LLC was lower than our share of the joint venture’s equity by $6.4 million as of March 31, 2026 and $6.5 million as of December 31, 2025 due to a difference between our cost basis and our share of the joint venture’s underlying equity in its net assets. We recognize adjustments to our share of the joint venture’s earnings and losses resulting from this basis difference in the underlying assets of the joint venture.