COPT Defense Properties Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements (Tables)

Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2014

Schedule of fair value assets and liabilities measured on recurring basis

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, 2014 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:
Interest rate derivatives (1)	$	—	$	2,151	$	—	$	2,151
Warrants to purchase common stock (1)	—		255		—		255
Total Assets	$	—	$	2,406	$	—	$	2,406
Liabilities:
Interest rate derivatives	$	—	$	3,236	$	—	$	3,236
Redeemable noncontrolling interest	$	—	$	—	$	18,901	$	18,901

(1) Included in the line entitled “prepaid expenses and other assets” on COPLP’s consolidated balance sheet.

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, 2014 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	$	7,309	$	—	$	—	$	7,309
Common stocks	111		—		—		111
Other	201		—		—		201
Interest rate derivatives (2)	—		2,151		—		2,151
Warrants to purchase common stock (2)	—		255		—		255
Total Assets	$	7,621	$	2,406	$	—	$	10,027
Liabilities:
Deferred compensation plan liability (3)	$	—	$	7,621	$	—	$	7,621
Interest rate derivatives	—		3,236		—		3,236
Total Liabilities	$	—	$	10,857	$	—	$	10,857
Redeemable noncontrolling interest	$	—	$	—	$	18,901	$	18,901

(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.

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 values of the properties (dollars in thousands):

Fair Value of Properties Held as of June 30, 2014

Quoted Prices in

Significant

Impairment Losses Recognized

Active Markets for

Significant Other

Unobservable

Three Months

Six Months

Identical Assets

Observable Inputs

Inputs

Ended

Description

(Level 1)

(Level 2)

(Level 3)

Total

June 30, 2014

Assets (1):

Properties, net

—

9,796

1,328

1,329

(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 technique used by us in determining the fair values of the properties (dollars in thousands):

Fair Value of Properties Held as of June 30, 2013

Quoted Prices in

Significant

Impairment Losses Recognized

Active Markets for

Significant Other

Unobservable

Three Months

Six Months

Identical Assets

Observable Inputs

Inputs

Ended

Description

(Level 1)

(Level 2)

(Level 3)

Total

June 30, 2013

Assets (1):

Properties, net

—

99,240

7,195

9,052

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 as of June 30, 2013 (dollars in thousands):



Valuation Technique	Fair Value on Measurement Date		Unobservable Input	Range (Weighted Average)
Bids for properties indicative of value	$	99,240	Indicative bids (1)	(1)

(1) These fair value measurements were developed as a result of negotiations between us and purchasers of the properties.

The table below sets forth quantitative information about significant unobservable inputs used for the Level 3 fair value measurements reported above as of June 30, 2014 (dollars in thousands):



Valuation Technique	Fair Value on Measurement Date		Unobservable Input	Range (Weighted Average)
Contracts of sale	$	9,796	Contract prices (1)	(1)

(1) These fair value measurements were developed as a result of negotiations between us and purchasers of the properties.