Quarterly report pursuant to Section 13 or 15(d)

DISCONTINUED OPERATIONS

v3.3.0.814
DISCONTINUED OPERATIONS
 9 Months Ended
Sep. 30, 2015
Discontinued Operations and Disposal Groups [Abstract]  
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS

On February 13, 2014, Newcastle completed the spin-off of New Media Investment Group Inc. ("New Media") from Newcastle.
On November 6, 2014, Newcastle completed the spin-off of New Senior Investment Group Inc. ("New Senior") from Newcastle.
In April 2015, Newcastle closed the sale of its commercial real estate properties in Beavercreek, OH for $7.0 million, net of closing costs, and recognized a net gain on the sale of these assets of approximately $0.3 million. In addition, Newcastle repaid the related debt on this property of $6.0 million held within CDO IX, which was eliminated in consolidation.

As a result of the spin-offs and the sale of the commercial real estate properties in Beavercreek, OH (which was initially reported as held-for-sale as of September 30, 2014), the assets, liabilities and results of operations of those components of Newcastle’s operations that (i) were part of the spin-offs, and/or (ii) represent operations in which Newcastle has no significant continuing involvement, are presented separately in discontinued operations in Newcastle’s consolidated financial statements for all periods presented.
With respect to the sale of the commercial real estate properties in Beavercreek, OH, the assets of discontinued operations include no investments in other real estate as of September 30, 2015 and $6.6 million as of December 31, 2014, and cash and cash equivalents, restricted cash and receivables and other assets in the total amount of $0.1 million and $0.2 million as of September 30, 2015 and December 31, 2014, respectively. There were no liabilities of discontinued operations as of September 30, 2015. The liabilities of discontinued operations include accounts payable, accrued liabilities and other liabilities of $0.5 million as of December 31, 2014.

Results from discontinued operations were as follows:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2015
 
2014
 
2015
 
2014
Interest income
$
—

 
$
—

 
$
—

 
$
—

Interest expense
—

 
14,138

 
—

 
43,525

Net interest income (loss)
—

 
(14,138
)
 
—

 
(43,525
)
 
 
 
 
 
 
 
 
Media income
—

 
—

 
—

 
68,213

Rental income
7

 
61,355

 
556

 
168,838

Care and ancillary income
—

 
6,428

 
—

 
17,555

Gain on settlement of investments
—

 
—

 
318

 
—

Other income
—

 
1,481

 
—

 
1,457

Total media, rental and other income
7

 
69,264

 
874

 
256,063

 
 
 
 
 
 
 
 
Media operating expenses
—

 
—

 
—

 
65,826

Property operating expenses
—

 
29,288

 
187

 
81,696

General and administrative expenses (A)
—

 
5,416

 
30

 
17,888

Depreciation and amortization
—

 
28,712

 
11

 
79,445

Income tax expense
—

 
334

 
—

 
110

Total expenses
—

 
63,750

 
228

 
244,965

 
 
 
 
 
 
 
 
Income (loss) from discontinued operations
$
7

 
$
(8,624
)
 
$
646

 
$
(32,427
)
 
 
 
 
 
 
 
 
Net income attributable to noncontrolling interests
$
—

 
$
—

 
$
—

 
$
522

(A)
Includes acquisition and spin-off related expenses of $4.0 million and $14.7 million for the three and nine months ended September 30, 2014.

The February 13, 2014 spin-off of New Media resulted in a $391.3 million reduction in the basis upon which Newcastle’s management fees are computed (and an equivalent reduction in the basis upon which the incentive compensation threshold is computed), as well as a reduction in the strike price of Newcastle’s then outstanding options.

The November 6, 2014 spin-off of New Senior resulted in a $673.0 million reduction in the basis upon which Newcastle’s management fees are computed (and an equivalent reduction in the basis upon which the incentive compensation threshold is computed), as well as a reduction in the strike price of Newcastle’s then outstanding options.
DISCONTINUED OPERATIONS

On February 13, 2014, Newcastle completed the spin-off of New Media Investment Group Inc. ("New Media") from Newcastle.
On November 6, 2014, Newcastle completed the spin-off of New Senior Investment Group Inc. ("New Senior") from Newcastle.
In April 2015, Newcastle closed the sale of its commercial real estate properties in Beavercreek, OH for $7.0 million, net of closing costs, and recognized a net gain on the sale of these assets of approximately $0.3 million. In addition, Newcastle repaid the related debt on this property of $6.0 million held within CDO IX, which was eliminated in consolidation.

As a result of the spin-offs and the sale of the commercial real estate properties in Beavercreek, OH (which was initially reported as held-for-sale as of September 30, 2014), the assets, liabilities and results of operations of those components of Newcastle’s operations that (i) were part of the spin-offs, and/or (ii) represent operations in which Newcastle has no significant continuing involvement, are presented separately in discontinued operations in Newcastle’s consolidated financial statements for all periods presented.
With respect to the sale of the commercial real estate properties in Beavercreek, OH, the assets of discontinued operations include no investments in other real estate as of September 30, 2015 and $6.6 million as of December 31, 2014, and cash and cash equivalents, restricted cash and receivables and other assets in the total amount of $0.1 million and $0.2 million as of September 30, 2015 and December 31, 2014, respectively. There were no liabilities of discontinued operations as of September 30, 2015. The liabilities of discontinued operations include accounts payable, accrued liabilities and other liabilities of $0.5 million as of December 31, 2014.

Results from discontinued operations were as follows:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2015
 
2014
 
2015
 
2014
Interest income
$
—

 
$
—

 
$
—

 
$
—

Interest expense
—

 
14,138

 
—

 
43,525

Net interest income (loss)
—

 
(14,138
)
 
—

 
(43,525
)
 
 
 
 
 
 
 
 
Media income
—

 
—

 
—

 
68,213

Rental income
7

 
61,355

 
556

 
168,838

Care and ancillary income
—

 
6,428

 
—

 
17,555

Gain on settlement of investments
—

 
—

 
318

 
—

Other income
—

 
1,481

 
—

 
1,457

Total media, rental and other income
7

 
69,264

 
874

 
256,063

 
 
 
 
 
 
 
 
Media operating expenses
—

 
—

 
—

 
65,826

Property operating expenses
—

 
29,288

 
187

 
81,696

General and administrative expenses (A)
—

 
5,416

 
30

 
17,888

Depreciation and amortization
—

 
28,712

 
11

 
79,445

Income tax expense
—

 
334

 
—

 
110

Total expenses
—

 
63,750

 
228

 
244,965

 
 
 
 
 
 
 
 
Income (loss) from discontinued operations
$
7

 
$
(8,624
)
 
$
646

 
$
(32,427
)
 
 
 
 
 
 
 
 
Net income attributable to noncontrolling interests
$
—

 
$
—

 
$
—

 
$
522

(A)
Includes acquisition and spin-off related expenses of $4.0 million and $14.7 million for the three and nine months ended September 30, 2014.

The February 13, 2014 spin-off of New Media resulted in a $391.3 million reduction in the basis upon which Newcastle’s management fees are computed (and an equivalent reduction in the basis upon which the incentive compensation threshold is computed), as well as a reduction in the strike price of Newcastle’s then outstanding options.

The November 6, 2014 spin-off of New Senior resulted in a $673.0 million reduction in the basis upon which Newcastle’s management fees are computed (and an equivalent reduction in the basis upon which the incentive compensation threshold is computed), as well as a reduction in the strike price of Newcastle’s then outstanding options.