Quarterly report pursuant to Section 13 or 15(d)

Discontinued Operations

v2.4.0.6
Discontinued Operations
 3 Months Ended
Mar. 31, 2013
Discontinued Operations and Disposal Groups [Abstract]  
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]
Discontinued Operations
On December 19, 2012, the Company completed the contribution of its equity interests in its wholly owned subsidiary, Two Harbors Property Investment LLC, to Silver Bay. Two Harbors Property Investment LLC previously housed the Company's portfolio of single-family rental properties. As the Company will not have any significant continuing involvement in Two Harbors Property Investment LLC, all of the associated operating results were removed from continuing operations and are presented separately as discontinued operations for the three months ended March 31, 2013 and 2012.
Summarized financial information for the discontinued operations are presented below.
 
Three Months Ended
 
March 31,
(in thousands)
2013
 
2012
Income:
  

 
   

Gain on contribution of entity
$
1,239

 
$
—

Real estate related revenues
—

 
4

Total income
1,239

 
4

Expenses:
 
 
 
Management fees
—

 
—

Real estate related expenses
—

 
17

Other operating expenses
(138
)
 
33

Total expenses
(138
)
 
50

Income (loss) from discontinued operations
$
1,377

 
$
(46
)


In addition to the gain on contribution of entity that was recorded in 2012 in connection with the closing of the contribution, certain adjustments were agreed to be recognized in 2013. These include an installment sales gain of approximately $4.0 million from Silver Bay, a reduction of 2013 management fees payable to PRCM Advisers of $4.3 million, and an immaterial amount of additional working capital adjustments determined in accordance with the contribution agreement entered into with Silver Bay. Of these amounts, $1.2 million of the installment sales gain was recorded as a gain on contribution of entity within discontinued operations, and the full $4.3 million of the reduction of 2013 management fees payable to PRCM Advisers was recorded within management fees, on the condensed consolidated statement of comprehensive income for the three months ended March 31, 2013. The remaining $0.1 million recorded within discontinued operations on the condensed consolidated statement of comprehensive income for the three months ended March 31, 2013 relates to accrual adjustments for transaction expenses related to the contribution. See Note 21 - Related Party Transactions for additional information.