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Fair Value of Assets and Liabilities

12 Months Ended

Dec. 31, 2025

The following table presents certain of our assets that are measured at fair value at December 31, 2025 and 2024, categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset.


	As of December 31, 2025				As of December 31, 2024
Description	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Recurring Fair Value Measurements Assets:
Investment in unconsolidated joint venture (Level 3) (1)	$	73,471	$	73,471	$	81,949	$	81,949
Investment in unconsolidated joint venture (Level 3) (2)	$	46,655	$	46,655	$	44,910	$	44,910
Interest rate cap (Level 2) (3)	$	—	$	—	$	—	$	—
Non-Recurring Fair Value Measurements Assets:
Real estate properties held for sale (Level 2) (4)	$	22,048	$	22,048	$	—	$	—

(1)The 10% equity interest we own in the Seaport JV is included in investments in unconsolidated joint ventures in our consolidated balance sheet, and is reported at fair value, which is based on significant unobservable inputs (Level 3 inputs). The assumptions made in the fair value analysis are based on the location, type and nature of the property, and current and anticipated market conditions. See Note 3 for further information regarding this joint venture.

(2)The 20% equity interest we own in the LSMD JV is included in investments in unconsolidated joint ventures in our consolidated balance sheet, and is reported at fair value, which is based on significant unobservable inputs (Level 3 inputs). The assumptions we made in the fair value analysis are based on the location, type and nature of each property, and current and anticipated market conditions. See Note 3 for further information regarding this joint venture.

(3)The fair value of our interest rate cap derivative is based on prevailing market prices in secondary markets for similar derivative contracts as of the measurement date.

(4)We have assets in our consolidated balance sheets that are measured at fair value on a non-recurring basis. During the year ended December 31, 2025, we recorded impairment charges of $30,999 to reduce the carrying value of 13 SHOP communities that were classified as held for sale to their estimated aggregate sales price, less estimated costs to sell, of $22,048 under an agreement we have entered into with a third party. See Note 3 for further information about impairment charges and the properties we have classified as held for sale.

The discount rates, exit capitalization rates and holding periods used to determine the fair value of our investment in the unconsolidated joint venture are Level 3 significant unobservable inputs and are shown in the table below:

Valuation Technique

Discount Rates

Exit Capitalization Rates

Holding Periods

As of December 31, 2025

Investment in unconsolidated joint venture (Level 3) (1)

Discounted cash flow

7.00%

6.00%

10 years

Investment in unconsolidated joint venture (Level 3) (2)

Discounted cash flow

6.25% - 8.75%

5.25% - 8.00%

10 - 12 years

As of December 31, 2024

Investment in unconsolidated joint venture (Level 3) (1)

Discounted cash flow

7.00%

6.00%

10 years

Investment in unconsolidated joint venture (Level 3) (2)

Discounted cash flow

6.25% - 7.75%

5.00% - 7.00%

10 years

inputs). The assumptions we made in the fair value analysis are based on the location, type and nature of each property, and current and anticipated market conditions. See Note 3 for further information regarding this joint venture.

In addition to the assets described in the tables above, our financial instruments at December 31, 2025 and December 31, 2024 included cash and cash equivalents, restricted cash, certain other assets, our revolving credit facility, senior unsecured notes, senior secured notes, secured debt and finance leases and certain other unsecured obligations and liabilities. The fair values of these financial instruments approximated their carrying values in our consolidated financial statements as of such dates, except as follows:


	As of December 31, 2025				As of December 31, 2024
Description	Carrying Value (1)		Estimated Fair Value		Carrying Value (1)		Estimated Fair Value
Senior unsecured notes, 9.750% coupon rate, due 2025	$	—	$	—	$	379,392	$	379,970
Senior secured notes, zero coupon rate, due 2026	—		—		826,974		885,108
Senior unsecured notes, 4.750% coupon rate, due 2028	497,290		482,635		496,018		429,170
Senior secured notes, 7.250% coupon rate, due 2030	365,005		383,434		—		—
Senior unsecured notes, 4.375% coupon rate, due 2031	495,561		440,000		494,702		368,240
Senior unsecured notes, 5.625% coupon rate, due 2042	343,683		224,140		343,302		218,260
Senior unsecured notes, 6.250% coupon rate, due 2046	244,192		175,000		243,905		157,700
Secured debt and finance leases	455,093		484,932		126,611		126,001
	$	2,400,824	$	2,190,141	$	2,910,904	$	2,564,449

(1)Includes unamortized net discounts, premiums and debt issuance costs, if any.

We estimated the fair values of our two issuances of senior unsecured notes due 2042 and 2046 based on the closing price on Nasdaq (Level 1 inputs as defined in the fair value hierarchy under GAAP) as of December 31, 2025 and 2024. We estimated the fair values of our three issuances of senior unsecured notes due 2025, 2028 and 2031 and our two issuances of senior secured notes due 2026 and 2030 using an average of the bid and ask price on Nasdaq on or about December 31, 2025 and 2024 (Level 2 inputs as defined in the fair value hierarchy under GAAP). We estimated the fair values of our secured debts by using discounted cash flows analyses and currently prevailing market terms as of the measurement date (Level 3 inputs as defined in the fair value hierarchy under GAAP). Because Level 3 inputs are unobservable, our estimated fair values may differ materially from the actual fair values.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details