lmrk-10q_20200930.htm

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

	September 30, 2020			December 31, 2019⁽¹⁾
Assets
Land	$	114,996		$	107,558
Real property interests		652,142			509,181
Construction in progress		41,573			49,116
Total land and real property interests		808,711			665,855
Accumulated depreciation and amortization of real property interests		(59,170	)		(48,995	)
Land and net real property interests		749,541			616,860
Investments in receivables, net		5,230			5,653
Investment in unconsolidated joint venture		61,585			62,059
Cash and cash equivalents		9,204			5,885
Restricted cash		3,244			5,619
Rent receivables		3,700			3,673
Due from Landmark and affiliates		2,232			1,132
Deferred loan costs, net		3,798			4,557
Deferred rent receivable		1,518			1,548
Other intangible assets, net		20,030			21,936
Assets held for sale (AHFS)		—			114,400
Right-of-use asset, net		6,492			6,615
Other assets		5,734			5,668
Total assets	$	872,308		$	855,605
Liabilities and equity
Revolving credit facility	$	193,200		$	179,500
Secured notes, net		280,769			217,098
Accounts payable and accrued liabilities		5,066			3,842
Other intangible liabilities, net		6,451			7,583
Liabilities associated with AHFS		—			64,627
Operating lease liability		6,752			6,766
Prepaid rent		5,996			5,391
Derivative liabilities		3,754			1,474
Total liabilities		501,988			486,281
Commitments and contingencies (Note 16)
Mezzanine equity
Series C cumulative redeemable convertible preferred units, 1,982,700 and 1,988,700 units issued and outstanding at September 30, 2020 and December 31, 2019, respectively		47,805			47,666
Equity
Series A cumulative redeemable preferred units, 1,786,775 and 1,722,041 units issued and outstanding at September 30, 2020 and December 31, 2019, respectively		41,800			40,210
Series B cumulative redeemable preferred units, 2,628,932 and 2,544,793 units issued and outstanding at September 30, 2020 and December 31, 2019, respectively		63,014			60,926
Common units, 25,478,042 and 25,353,140 units issued and outstanding at September 30, 2020 and December 31, 2019, respectively		378,263			382,581
General Partner		(159,898	)		(162,277	)
Accumulated other comprehensive income (loss)		(865	)		17
Total partners' equity		322,314			321,457
Noncontrolling interests		201			201
Total equity		322,515			321,658
Total liabilities, mezzanine equity and equity	$	872,308		$	855,605

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020⁽¹⁾			2019⁽¹⁾			2020⁽¹⁾			2019⁽¹⁾
Revenue
Rental revenue	$	14,228		$	12,931		$	41,893		$	39,833
Expenses
Property operating		360			261			1,223			1,117
General and administrative		768			1,249			3,479			4,173
Acquisition-related		—			72			91			276
Depreciation and amortization		3,808			3,218			11,711			9,833
Impairments		16			442			200			646
Total expenses		4,952			5,242			16,704			16,045
Other income and expenses
Interest and other income		46			142			317			588
Interest expense		(4,068	)		(3,917	)		(12,759	)		(13,059	)
Loss on early extinguishment of debt		—			—			(2,231	)		—
Unrealized gain (loss) on derivatives		154			(1,299	)		(6,530	)		(7,027	)
Equity income from unconsolidated joint venture		248			154			1,085			263
Gain on sale of real property interests		—			473			—			18,008
Total other income and expenses		(3,620	)		(4,447	)		(20,118	)		(1,227	)
Income from continuing operations before income tax expense (benefit)		5,656			3,242			5,071			22,561
Income tax expense (benefit)		(173	)		38			(508	)		3,160
Income from continuing operations		5,829			3,204			5,579			19,401
Income (loss) from discontinued operations, net of tax		(171	)		782			17,340			1,060
Net income		5,658			3,986			22,919			20,461
Less: Net income attributable to noncontrolling interest		8			7			24			23
Net income attributable to limited partners		5,650			3,979			22,895			20,438
Less: Distributions declared to preferred unitholders		(3,055	)		(2,985	)		(9,152	)		(8,900	)
Less: General partner's incentive distribution rights		—			(197	)		—			(591	)
Less: Accretion of Series C preferred units		(96	)		(96	)		(289	)		(546	)
Net income attributable to common unitholders	$	2,499		$	701		$	13,454		$	10,401
Income (loss) from continuing operations per common unit
Common units – basic	$	0.10		$	—		$	(0.15	)	$	0.37
Common units – diluted	$	0.10		$	—		$	(0.15	)	$	0.37
Net income per common unit
Common units – basic	$	0.10		$	0.03		$	0.53		$	0.41
Common units – diluted	$	0.10		$	0.03		$	0.53		$	0.41
Weighted average common units outstanding
Common units – basic		25,478			25,341			25,472			25,339
Common units – diluted		25,478			25,341			25,472			25,339
Cash distributions declared per common unit	$	0.2000		$	0.3675		$	0.6000		$	1.1025

	Three Months Ended September 30,					Nine Months Ended September 30,
	2020		2019			2020			2019
Net income	$	5,658	$	3,986		$	22,919		$	20,461
Other comprehensive income (loss):
Foreign currency translation adjustment		416		(2,981	)		(5,234	)		(3,653	)
Reclassification adjustments of other comprehensive losses to gain on sale included in net income		—		—			4,352			—
Other comprehensive income (loss):		416		(2,981	)		(882	)		(3,653	)
Comprehensive income		6,074		1,005			22,037			16,808
Less: Comprehensive income attributable to noncontrolling interest		8		7			24			23
Comprehensive income attributable to limited partners	$	6,066	$	998		$	22,013		$	16,785

																Accumulated							Mezzanine
			Preferred		Preferred				Preferred		Preferred					Other							Equity -
	Common		Units -		Units -		Common		Unitholders -		Unitholders -		General			Comprehensive			Noncontrolling		Total		Series C
	Units		Series A		Series B		Unitholders		Series A		Series B		Partner			Income (loss)			Interest		Equity		Preferred
Balance as of December 31, 2018		25,328		1,593		2,463	$	411,158	$	37,207	$	58,936	$	(167,019	)	$	(2,806	)	$	201	$	337,677	$	47,308

Delaware		61-1742322
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
400 Continental Blvd., Suite 500
P.O. Box 3429
El Segundo, CA 90245		90245
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Units, Representing Limited Partner Interests	LMRK	NASDAQ Global Market
8.0% Series A Cumulative Redeemable Preferred Units, $25.00 par value	LMRKP	NASDAQ Global Market
7.9% Series B Cumulative Redeemable Preferred Units, $25.00 par value	LMRKO	NASDAQ Global Market
Series C Floating-to-Fixed Rate Cumulative Redeemable Perpetual Convertible Preferred Units, $25.00 par value	LMRKN	NASDAQ Global Market

Large accelerated filer ☐		Accelerated filer ☒		Non-accelerated filer ☐		Smaller reporting company ☐
Emerging growth company ☐

		Page


	PART I. FINANCIAL INFORMATION

Item 1.	Unaudited Financial Statements:

	Consolidated Balance Sheets	3

	Consolidated Statements of Operations	4

	Consolidated Statements of Comprehensive Income (Loss)	5

	Consolidated Statements of Equity and Mezzanine Equity	6

	Consolidated Statements of Cash Flows	8

	Notes to the Consolidated Financial Statements	9

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	35

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	58

Item 4.	Controls and Procedures	59

	PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	60

Item 1A.	Risk Factors	60

Item 6.	Exhibits	62

Signatures		64