Maryland | 27-3663988 |
(State or Other Jurisdiction of | (IRS Employer |
Incorporation or Organization) | Identification No.) |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer ý | Smaller reporting company o Emerging growth company o |
Index | Page | |
• | adverse economic conditions and the impact on the real estate industry, including healthcare real estate; |
• | the impact of economic conditions on the operators/tenants of the real property that we own as well as on borrowers of the debt we originate and acquire; |
• | the ability of our tenants, operators and managers to conduct their respective businesses in a manner sufficient to maintain or increase their revenues and to generate sufficient income to make rent payments to us and, in turn, our ability to satisfy our obligations under our borrowings; |
• | the impact of increased operating costs on our liquidity, financial condition and results of operations or that of our tenants, operators, managers and borrowers and our ability and the ability of our tenants, operators, managers and borrowers to accurately estimate the magnitude of those costs; |
• | the nature and extent of future competition, including new construction in the markets in which our assets are located; |
• | the ability of our tenants, operators and managers, as applicable, to comply with laws, rules and regulations in the operation of our properties, to deliver high-quality services, to attract and retain qualified personnel and to attract residents and patients; |
• | the ability and willingness of our tenants, operators, managers and other third parties to satisfy their respective obligations to us, including in some cases their obligation to indemnify us from and against various claims and liabilities; |
• | the financial weakness of our tenants, operators and borrowers, including potential bankruptcies and downturns in their businesses, and their legal and regulatory proceedings, which results in uncertainties regarding our ability to continue to realize the full benefit of such tenants’ and operators’ leases and borrowers’ loans and/or expose us to additional liabilities and expenses; |
• | risks associated with our joint ventures and unconsolidated entities, including our reliance on joint venture partners, lack of decision making authority and the financial condition of our joint venture partners; |
• | the impact of market and other conditions influencing the performance of our investments relative to our expectations and the impact on our actual return on invested equity, as well as the cash provided by these investments; |
• | our liquidity and access to capital; |
• | our use of leverage; |
• | our ability to make distributions to our stockholders; |
• | the lack of a public trading market for our shares; |
• | the effect of economic conditions on the valuation of our investments; |
• | the effect of paying distributions to our stockholders from sources other than cash flow provided by operations; |
• | our dependence on the resources and personnel of our advisor, our sponsor and their affiliates, including our advisor’s ability to manage our portfolio on our behalf; |
• | the performance of our advisor, our sponsor and their affiliates; |
• | the impact of our sponsor’s merger with NorthStar Realty Finance Corp. and Colony Capital, Inc.; |
• | our advisor’s and its affiliates’ ability to attract and retain qualified personnel to support our operations and potential changes to key personnel providing management services to us; |
• | our reliance on our advisor and its affiliates and sub-advisors/co-venturers in providing management services to us, the payment of substantial fees to our advisor, and various potential conflicts of interest in our relationship with our sponsor; |
• | changes in our business or investment strategy; |
• | any failure in our advisor’s and its affiliates’ due diligence to identify relevant facts during our underwriting process or otherwise; |
• | changes in the value of our portfolio; |
• | the impact of fluctuations in interest rates; |
• | our ability to realize current and expected returns over the life of our investments; |
• | any failure in our advisor’s and its affiliates’ due diligence to identify relevant facts during our underwriting process or otherwise; |
• | illiquidity of properties or debt investments in our portfolio; |
• | environmental compliance costs and liabilities; |
• | the effectiveness of our risk and portfolio management systems; |
• | the potential failure to maintain effective internal controls and disclosure controls and procedures; |
• | regulatory requirements with respect to our business and the healthcare industry generally, as well as the related cost of compliance; |
• | the extent and timing of future healthcare reform and regulation, including changes in reimbursement policies, procedures and rates; |
• | legislative and regulatory changes, including changes to laws governing the taxation of real estate investment trusts, or REITs; |
• | our ability to maintain our qualification as a REIT for federal income tax purposes and limitations imposed on our business by our status as a REIT; |
• | the loss of our exemption from registration under the Investment Company Act of 1940, as amended; |
• | general volatility in capital markets; |
• | the adequacy of our cash reserves and working capital; and |
• | other risks associated with investing in our targeted investments, including changes in our industry, interest rates, the securities markets, the general economy or the capital markets and real estate markets specifically. |
September 30, 2018 (Unaudited) | December 31, 2017 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 37,983 | $ | 50,046 | |||
Restricted cash | 25,515 | 30,442 | |||||
Operating real estate, net | 1,814,849 | 1,852,428 | |||||
Investments in unconsolidated ventures | 322,538 | 325,582 | |||||
Real estate debt investments, net | 74,725 | 74,650 | |||||
Senior housing mortgage loans held in a securitization trust, at fair value | — | 545,048 | |||||
Receivables, net | 14,275 | 18,363 | |||||
Deferred costs and intangible assets, net | 47,003 | 84,720 | |||||
Other assets | 13,186 | 17,474 | |||||
Total assets(1) | $ | 2,350,074 | $ | 2,998,753 | |||
Liabilities | |||||||
Mortgage and other notes payable, net | $ | 1,470,646 | $ | 1,487,480 | |||
Senior housing mortgage obligations issued by a securitization trust, at fair value | — | 512,772 | |||||
Due to related party | 2,491 | 1,046 | |||||
Escrow deposits payable | 5,416 | 3,817 | |||||
Distribution payable | 5,197 | 10,704 | |||||
Accounts payable and accrued expenses | 27,920 | 33,478 | |||||
Other liabilities | 6,988 | 4,657 | |||||
Total liabilities(1) | 1,518,658 | 2,053,954 | |||||
Commitments and contingencies | |||||||
Equity | |||||||
NorthStar Healthcare Income, Inc. Stockholders’ Equity | |||||||
Preferred stock, $0.01 par value, 50,000,000 shares authorized, no shares issued and outstanding as of September 30, 2018 and December 31, 2017 | — | — | |||||
Common stock, $0.01 par value, 400,000,000 shares authorized, 187,683,452 and 186,709,303 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 1,877 | 1,867 | |||||
Additional paid-in capital | 1,691,198 | 1,681,040 | |||||
Retained earnings (accumulated deficit) | (865,707 | ) | (744,090 | ) | |||
Accumulated other comprehensive income (loss) | (1,717 | ) | (316 | ) | |||
Total NorthStar Healthcare Income, Inc. stockholders’ equity | 825,651 | 938,501 | |||||
Non-controlling interests | 5,765 | 6,298 | |||||
Total equity | 831,416 | 944,799 | |||||
Total liabilities and equity | $ | 2,350,074 | $ | 2,998,753 |
(1) | Represents the consolidated assets and liabilities of NorthStar Healthcare Income Operating Partnership, LP (the “Operating Partnership”). The Operating Partnership is a consolidated variable interest entity (“VIE”), of which the Company is the sole general partner and owns approximately 99.99%. As of September 30, 2018, the Operating Partnership includes $0.7 billion and $0.5 billion of assets and liabilities, respectively, of certain VIEs that are consolidated by the Operating Partnership. Refer to Note 2, “Summary of Significant Accounting Policies.” |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Property and other revenues | |||||||||||||||
Resident fee income | $ | 32,469 | $ | 33,233 | $ | 98,232 | $ | 93,060 | |||||||
Rental income | 39,986 | 40,507 | 119,626 | 114,189 | |||||||||||
Other revenue | 1,015 | 661 | 2,692 | 2,191 | |||||||||||
Total property and other revenues | 73,470 | 74,401 | 220,550 | 209,440 | |||||||||||
Net interest income | |||||||||||||||
Interest income on debt investments | 1,943 | 1,940 | 5,763 | 5,755 | |||||||||||
Interest income on mortgage loans held in a securitized trust | — | 6,536 | 5,149 | 19,503 | |||||||||||
Interest expense on mortgage obligations issued by a securitization trust | — | (4,919 | ) | (3,824 | ) | (14,662 | ) | ||||||||
Net interest income | 1,943 | 3,557 | 7,088 | 10,596 | |||||||||||
Expenses | |||||||||||||||
Real estate properties - operating expenses | 47,355 | 42,981 | 141,510 | 118,526 | |||||||||||
Interest expense | 17,677 | 15,687 | 52,408 | 44,479 | |||||||||||
Other expenses related to securitization trust | — | 981 | 811 | 2,947 | |||||||||||
Transaction costs | — | 3,814 | 806 | 6,778 | |||||||||||
Asset management and other fees - related party | 5,951 | 13,299 | 17,845 | 32,716 | |||||||||||
General and administrative expenses | 2,818 | 3,041 | 9,927 | 8,392 | |||||||||||
Depreciation and amortization | 25,629 | 24,454 | 81,943 | 69,223 | |||||||||||
Impairment loss | — | — | 5,239 | — | |||||||||||
Total expenses | 99,430 | 104,257 | 310,489 | 283,061 | |||||||||||
Other income (loss) | |||||||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | 384 | — | 1,108 | |||||||||||
Realized gain (loss) on investments and other | 726 | — | 4,221 | 118 | |||||||||||
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense) | (23,291 | ) | (25,915 | ) | (78,630 | ) | (61,799 | ) | |||||||
Equity in earnings (losses) of unconsolidated ventures | 16,631 | (18,557 | ) | 3,907 | (31,234 | ) | |||||||||
Income tax benefit (expense) | (10 | ) | (15 | ) | (40 | ) | (56 | ) | |||||||
Net income (loss) | (6,670 | ) | (44,487 | ) | (74,763 | ) | (93,089 | ) | |||||||
Net (income) loss attributable to non-controlling interests | 66 | 97 | 397 | 27 | |||||||||||
Net income (loss) attributable to NorthStar Healthcare Income, Inc. common stockholders | $ | (6,604 | ) | $ | (44,390 | ) | $ | (74,366 | ) | $ | (93,062 | ) | |||
Net income (loss) per share of common stock, basic/diluted | $ | (0.04 | ) | $ | (0.24 | ) | $ | (0.40 | ) | $ | (0.50 | ) | |||
Weighted average number of shares of common stock outstanding, basic/diluted | 187,432,091 | 186,825,812 | 187,278,444 | 186,293,783 | |||||||||||
Distributions declared per share of common stock | 0.09 | 0.17 | 0.25 | 0.51 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income (loss) | $ | (6,670 | ) | $ | (44,487 | ) | $ | (74,763 | ) | $ | (93,089 | ) | |||
Other comprehensive income (loss) | |||||||||||||||
Foreign currency translation adjustments related to investment in unconsolidated venture | (515 | ) | 605 | (1,401 | ) | 2,185 | |||||||||
Total other comprehensive income (loss) | (515 | ) | 605 | (1,401 | ) | 2,185 | |||||||||
Comprehensive income (loss) | (7,185 | ) | (43,882 | ) | (76,164 | ) | (90,904 | ) | |||||||
Comprehensive (income) loss attributable to non-controlling interests | 66 | 97 | 397 | 27 | |||||||||||
Comprehensive income (loss) attributable to NorthStar Healthcare Income, Inc. common stockholders | $ | (7,119 | ) | $ | (43,785 | ) | $ | (75,767 | ) | $ | (90,877 | ) |
Common Stock | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Total Company’s Stockholders’ Equity | Non-controlling Interests | Total Equity | ||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||
Balance as of December 31, 2016 | 185,035 | $ | 1,850 | $ | 1,666,479 | $ | (480,516 | ) | $ | (1,188 | ) | $ | 1,186,625 | $ | 5,349 | $ | 1,191,974 | |||||||||||||
Issuance and amortization of equity-based compensation | 20 | — | 146 | — | — | 146 | — | 146 | ||||||||||||||||||||||
Non-controlling interests - contributions | — | — | — | — | — | — | 2,952 | 2,952 | ||||||||||||||||||||||
Non-controlling interests - distributions | — | — | — | — | — | — | (230 | ) | (230 | ) | ||||||||||||||||||||
Shares redeemed for cash | (3,700 | ) | (37 | ) | (34,081 | ) | — | — | (34,118 | ) | — | (34,118 | ) | |||||||||||||||||
Distributions declared | — | — | — | (94,030 | ) | — | (94,030 | ) | — | (94,030 | ) | |||||||||||||||||||
Proceeds from distribution reinvestment plan | 5,559 | 56 | 50,537 | — | — | 50,593 | — | 50,593 | ||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | 2,185 | 2,185 | — | 2,185 | ||||||||||||||||||||||
Net income (loss) | — | — | — | (93,062 | ) | — | (93,062 | ) | (27 | ) | (93,089 | ) | ||||||||||||||||||
Balance as of September 30, 2017 (Unaudited) | 186,914 | $ | 1,869 | $ | 1,683,081 | $ | (667,608 | ) | $ | 997 | $ | 1,018,339 | $ | 8,044 | $ | 1,026,383 | ||||||||||||||
Common Stock | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Total Company’s Stockholders’ Equity | Non-controlling Interests | Total Equity | ||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||
Balance as of December 31, 2017 | 186,709 | $ | 1,867 | $ | 1,681,040 | $ | (744,090 | ) | $ | (316 | ) | $ | 938,501 | $ | 6,298 | $ | 944,799 | |||||||||||||
Share-based payment of advisor asset management fees | 882 | 9 | 7,491 | — | — | 7,500 | — | 7,500 | ||||||||||||||||||||||
Issuance and amortization of equity-based compensation | 21 | — | 129 | — | — | 129 | — | 129 | ||||||||||||||||||||||
Non-controlling interests - contributions | — | — | — | — | — | — | 395 | 395 | ||||||||||||||||||||||
Non-controlling interests - distributions | — | — | — | — | — | — | (531 | ) | (531 | ) | ||||||||||||||||||||
Shares redeemed for cash | (3,028 | ) | (30 | ) | (23,773 | ) | — | — | (23,803 | ) | — | (23,803 | ) | |||||||||||||||||
Distributions declared | — | — | — | (47,251 | ) | — | (47,251 | ) | — | (47,251 | ) | |||||||||||||||||||
Proceeds from distribution reinvestment plan | 3,099 | 31 | 26,311 | — | — | 26,342 | — | 26,342 | ||||||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | (1,401 | ) | (1,401 | ) | — | (1,401 | ) | |||||||||||||||||||
Net income (loss) | — | — | — | (74,366 | ) | — | (74,366 | ) | (397 | ) | (74,763 | ) | ||||||||||||||||||
Balance as of September 30, 2018 (Unaudited) | 187,683 | $ | 1,877 | $ | 1,691,198 | $ | (865,707 | ) | $ | (1,717 | ) | $ | 825,651 | $ | 5,765 | $ | 831,416 |
Nine Months Ended September 30, | |||||||
2018 | 2017 | ||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | (74,763 | ) | $ | (93,089 | ) | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||
Equity in (earnings) losses of unconsolidated ventures | (3,907 | ) | 31,234 | ||||
Depreciation and amortization | 81,943 | 69,223 | |||||
Impairment loss | 5,239 | — | |||||
Amortization of below market debt | 2,190 | 1,988 | |||||
Straight-line rental income, net and amortization of lease inducements | 628 | (1,287 | ) | ||||
Amortization of premium/accretion of discount on investments | (75 | ) | (68 | ) | |||
Amortization of deferred financing costs | 1,439 | 1,220 | |||||
Amortization of equity-based compensation | 129 | 146 | |||||
Realized (gain) loss on investments and other | (4,221 | ) | (118 | ) | |||
Unrealized (gain) loss on senior housing mortgage loans and debt held in securitization trust, net | — | (1,108 | ) | ||||
Allowance for uncollectible accounts | 2,105 | 943 | |||||
Distributions of cumulative earnings from unconsolidated ventures | — | 427 | |||||
Changes in assets and liabilities: | |||||||
Receivables | 2,257 | (3,623 | ) | ||||
Other assets | 1,918 | (1,993 | ) | ||||
Due to related party | 8,945 | 5,187 | |||||
Escrow deposits payable | 1,599 | 1,252 | |||||
Accounts payable and accrued expenses | (5,691 | ) | 5,474 | ||||
Other liabilities | 265 | (366 | ) | ||||
Net cash provided by (used in) operating activities | 20,000 | 15,442 | |||||
Cash flows from investing activities: | |||||||
Acquisition of operating real estate investments | — | (297,955 | ) | ||||
Improvement of operating real estate investments | (20,003 | ) | (13,463 | ) | |||
Sale of operating real estate investment | 11,784 | — | |||||
Sale of healthcare-related securities | 35,771 | — | |||||
Investment in unconsolidated ventures | (4,470 | ) | (9,099 | ) | |||
Distributions in excess of cumulative earnings from unconsolidated ventures | 10,020 | 11,206 | |||||
Other assets | 1,589 | 3,288 | |||||
Net cash provided by (used in) investing activities | 34,691 | (306,023 | ) | ||||
Cash flows from financing activities: | |||||||
Borrowing from mortgage notes | — | 173,690 | |||||
Repayment of mortgage notes | (20,492 | ) | (1,834 | ) | |||
Payment of deferred financing costs | (284 | ) | (2,111 | ) | |||
Debt extinguishment costs | (97 | ) | — | ||||
Shares redeemed for cash | (23,803 | ) | (34,118 | ) | |||
Payments under capital leases | (453 | ) | — | ||||
Distributions paid on common stock | (52,758 | ) | (94,238 | ) | |||
Proceeds from distribution reinvestment plan | 26,342 | 50,593 | |||||
Contributions from non-controlling interests | 395 | 2,952 | |||||
Distributions to non-controlling interests | (531 | ) | (230 | ) | |||
Net cash provided by (used in) financing activities | (71,681 | ) | 94,704 | ||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (16,990 | ) | (195,877 | ) | |||
Cash, cash equivalents and restricted cash-beginning of period | 80,488 | 251,892 | |||||
Cash, cash equivalents and restricted cash-end of period | $ | 63,498 | $ | 56,015 |
Nine Months Ended September 30, | |||||||
2018 | 2017 | ||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Accrued distribution payable | $ | 5,197 | $ | 10,371 | |||
Accrued capital expenditures | 461 | — | |||||
Reclassification of assets held for sale | — | — | |||||
Issuance of common stock as payment for asset management fees | 7,500 | — | |||||
Deconsolidation of securitization trust (VIE asset/liability) | 512,772 | — | |||||
Assumption of mortgage notes payable upon acquisitions of operating real estate | — | 21,685 | |||||
Acquisition of operating real estate under capital lease obligations | 2,108 | — | |||||
Change in carrying value of securitization trust (VIE asset/liability) | — | 2,728 | |||||
Debt financing provided by seller for investment acquisition | — | 3,500 |
1. | Business and Organization |
2. | Summary of Significant Accounting Policies |
September 30, 2018 (Unaudited) | December 31, 2017 | |||||||
Cash and cash equivalents | $ | 37,983 | $ | 50,046 | ||||
Restricted cash | 25,515 | 30,442 | ||||||
Total cash, cash equivalents and restricted cash | $ | 63,498 | $ | 80,488 |
Category: | Term: | |
Building | 30 to 50 years | |
Building improvements | Lesser of the useful life or remaining life of the building | |
Land improvements | 9 to 15 years | |
Tenant improvements | Lesser of the useful life or remaining term of the lease | |
Furniture, fixtures and equipment | 5 to 14 years |
October 1 to December 31, 2018 | $ | 164 | ||
Years Ending December 31: | ||||
2019 | 588 | |||
2020 | 549 | |||
2021 | 510 | |||
2022 | 418 | |||
Thereafter | 25 | |||
Total minimum lease payments | $ | 2,254 | ||
Less: Amount representing interest | $ | (188 | ) | |
Present value of minimum lease payments | $ | 2,066 |
September 30, 2018 (Unaudited) | December 31, 2017 | |||||||
Deferred costs and intangible assets, net: | ||||||||
In-place lease value, net | $ | 24,489 | $ | 61,593 | ||||
Goodwill | 21,387 | 22,112 | ||||||
Other intangible assets | 380 | 380 | ||||||
Subtotal intangible assets | 46,256 | 84,085 | ||||||
Deferred costs, net | 747 | 635 | ||||||
Total | $ | 47,003 | $ | 84,720 |
October 1 to December 31, 2018 | $ | 9,999 | ||
Years Ending December 31: | ||||
2019 | 8,428 | |||
2020 | 2,093 | |||
2021 | 1,871 | |||
2022 | 593 | |||
Thereafter | 2,252 | |||
Total | $ | 25,236 |
September 30, 2018 (Unaudited) | December 31, 2017 | |||||||
Other assets: | ||||||||
Healthcare facility regulatory reserve deposit | $ | 6,000 | $ | 6,000 | ||||
Remainder interest in condominium units(1) | 3,025 | 3,704 | ||||||
Prepaid expenses | 2,767 | 3,352 | ||||||
Lease inducements, net | — | 1,691 | ||||||
Utility deposits | 356 | 503 | ||||||
Construction deposit | — | 993 | ||||||
Other | 1,038 | 1,231 | ||||||
Total | $ | 13,186 | $ | 17,474 |
(1) | Represents future interests in property subject to life estates (“Remainder Interest”). |
Nine Months Ended September 30, 2017 | ||||||||
Cash flow provided by (used in): | As Previously Reported | After Adoption of ASU 2016-18 | ||||||
Operating activities | $ | 11,708 | $ | 15,442 | ||||
Investing activities | (305,331 | ) | (306,023 | ) | ||||
Financing activities | 97,916 | 94,704 |
3. | Operating Real Estate |
September 30, 2018 (Unaudited) | December 31, 2017 | |||||||
Land | $ | 237,340 | $ | 239,580 | ||||
Land improvements | 22,190 | 21,908 | ||||||
Buildings and improvements | 1,598,894 | 1,608,180 | ||||||
Tenant improvements | 11,284 | 8,291 | ||||||
Construction in progress | 13,754 | 5,376 | ||||||
Furniture, fixtures and equipment | 88,552 | 83,017 | ||||||
Subtotal | 1,972,014 | 1,966,352 | ||||||
Less: Accumulated depreciation | (157,165 | ) | (113,924 | ) | ||||
Operating real estate, net | $ | 1,814,849 | $ | 1,852,428 |
4. | Investments in Unconsolidated Ventures |
Properties as of September 30, 2018(1) | ||||||||||||||||||||||||||||||
Portfolio | Partner | Acquisition Date | Ownership | Purchase Price(2) | Equity Investment(3) | Senior Housing Facilities | MOB | SNF | Hospitals | Total | ||||||||||||||||||||
Eclipse | Colony Capital/Formation Capital, LLC | May-2014 | 5.6 | % | $ | 1,048,000 | $ | 23,400 | 44 | — | 32 | — | 76 | |||||||||||||||||
Envoy | Formation Capital, LLC/Safanad Management Limited | Sep-2014 | 11.4 | % | 145,000 | 5,000 | — | — | 11 | — | 11 | |||||||||||||||||||
Griffin - American | Colony Capital | Dec-2014 | 14.3 | % | 3,238,547 | 206,143 | 92 | 108 | 41 | 14 | 255 | |||||||||||||||||||
Espresso | Formation Capital, LLC/Safanad Management Limited | Jul-2015 | 36.7 | % | 870,000 | 55,146 | 6 | — | 150 | — | 156 | |||||||||||||||||||
Trilogy | Griffin-American Healthcare REIT III, Inc./Management Team of Trilogy Investors, LLC | Dec-2015 | 29.0 | % | 1,162,613 | 233,290 | 9 | — | 70 | — | 79 | |||||||||||||||||||
Subtotal | 6,464,160 | 522,979 | 151 | 108 | 304 | 14 | 577 | |||||||||||||||||||||||
Operator Platform(4) | Jul-2017 | 20.0 | % | 2 | 2 | — | — | — | — | — | ||||||||||||||||||||
Total | $ | 6,464,162 | $ | 522,981 | 151 | 108 | 304 | 14 | 577 |
(1) | Excludes six properties sold during the nine months ended September 30, 2018 and one property designated as held for sale as of September 30, 2018. |
(2) | Purchase price represents the actual or implied gross purchase price for the joint venture on the acquisition date. Purchase price is not adjusted for subsequent acquisitions or dispositions of interest. |
(3) | Represents initial and subsequent contributions to the underlying joint venture through September 30, 2018. During the nine months ended September 30, 2018, the Company funded an additional capital contribution of $4.5 million into the Trilogy joint venture. The additional funding related to certain business initiatives, including the development of additional senior housing and SNFs. |
(4) | Represents investment in Solstice Senior Living, LLC (“Solstice”). In November 2017, the Company began the transition of operations of the Winterfell portfolio from the former manager, an affiliate of Holiday Retirement, to a new manager, Solstice. Solstice is a joint venture between affiliates of Integral Senior Living, LLC (“ISL”), a leading management company of ILF, ALF and MCF founded in 2000, which owns 80.0%, and the Company, which owns 20.0%. |
Three Months Ended September 30, 2018 | Three Months Ended September 30, 2017 | Carrying Value | ||||||||||||||||||||||||||||||
Select Revenues and Expenses, net(1) | Select Revenues and Expenses, net(1) | |||||||||||||||||||||||||||||||
Portfolio | Equity in Earnings (Losses) | Cash Distributions | Equity in Earnings (Losses) | Cash Distributions | September 30, 2018 (Unaudited)(2) | December 31, 2017(2) | ||||||||||||||||||||||||||
Eclipse | $ | (69 | ) | $ | (462 | ) | $ | 176 | $ | (776 | ) | $ | (1,229 | ) | $ | 581 | $ | 12,533 | $ | 13,143 | ||||||||||||
Envoy | 339 | 64 | 283 | 247 | (1 | ) | 248 | 4,725 | 5,037 | |||||||||||||||||||||||
Griffin - American | (1,805 | ) | (4,688 | ) | 1,771 | (1,261 | ) | (4,553 | ) | 1,216 | 124,933 | 134,219 | ||||||||||||||||||||
Espresso | 17,886 | (3) | 15,982 | — | (16,609 | ) | (4) | (19,964 | ) | — | 11,639 | 5,308 | ||||||||||||||||||||
Trilogy | 239 | (3,659 | ) | 1,450 | (158 | ) | (4,900 | ) | — | 168,635 | 167,845 | |||||||||||||||||||||
Subtotal | 16,590 | 7,237 | 3,680 | (18,557 | ) | (30,647 | ) | 2,045 | 322,465 | 325,552 | ||||||||||||||||||||||
Operator Platform(5) | 41 | — | 15 | — | — | — | 73 | 30 | ||||||||||||||||||||||||
Total | $ | 16,631 | $ | 7,237 | $ | 3,695 | $ | (18,557 | ) | $ | (30,647 | ) | $ | 2,045 | $ | 322,538 | $ | 325,582 |
(1) | Represents the net amount of the Company’s proportionate share of the following revenues and expenses: straight-line rental income (expense), (above)/below market lease and in-place lease amortization, (above)/below market debt and deferred financing costs amortization, depreciation and amortization expense, acquisition fees and transaction costs, loan loss reserves, liability extinguishment gains, impairment, as well as unrealized and realized gain (loss) from sales of real estate and investments. |
(2) | Includes $1.3 million, $0.4 million, $13.4 million, $7.6 million, and $9.8 million of capitalized acquisition costs for the Company’s investments in the Eclipse, Envoy, Griffin-American, Espresso and Trilogy joint ventures, respectively. During the three months ended September 30, 2018, the Company expensed, through equity in earnings, the capitalized acquisition costs for the Company’s investment in the Envoy joint venture, which reduced the carrying value. |
(3) | Includes a liability extinguishment gain recorded by the joint venture, of which the Company’s proportionate share totaled $14.1 million. Refer to “Credit Losses and Impairment on Investments” in Note 2, “Summary of Significant Accounting Policies” for additional discussion. |
(4) | Includes a loan loss reserve recorded by the joint venture, of which the Company’s proportionate share totaled $15.8 million. Refer to “Credit Losses and Impairment on Investments” in Note 2, “Summary of Significant Accounting Policies” for additional discussion. |
(5) | Represents the Company’s investment in Solstice. |
Nine Months Ended September 30, 2018 | Nine Months Ended September 30, 2017 | |||||||||||||||||||||||
Select Revenues and Expenses, net(1) | Select Revenues and Expenses, net(1) | |||||||||||||||||||||||
Portfolio | Equity in Earnings (Losses) | Cash Distributions | Equity in Earnings (Losses) | Cash Distributions | ||||||||||||||||||||
Eclipse | $ | 11 | $ | (1,304 | ) | $ | 621 | $ | (1,186 | ) | $ | (2,660 | ) | $ | 985 | |||||||||
Envoy | (29 | ) | (300 | ) | 283 | 419 | (1 | ) | 427 | |||||||||||||||
Griffin - American | (3,692 | ) | (13,500 | ) | 4,193 | (5,795 | ) | (15,228 | ) | 6,913 | ||||||||||||||
Espresso | 6,331 | (2) | 2,296 | — | (19,258 | ) | (3) | (27,032 | ) | 3,307 | ||||||||||||||
Trilogy | 1,137 | (11,244 | ) | 4,816 | (5,414 | ) | (17,637 | ) | — | |||||||||||||||
Subtotal | $ | 3,758 | $ | (24,052 | ) | $ | 9,913 | $ | (31,234 | ) | $ | (62,558 | ) | $ | 11,632 | |||||||||
Operator Platform(4) | 149 | — | 107 | — | — | — | ||||||||||||||||||
Total | $ | 3,907 | $ | (24,052 | ) | $ | 10,020 | $ | (31,234 | ) | $ | (62,558 | ) | $ | 11,632 |
(1) | Represents the net amount of the Company’s proportionate share of the following revenues and expenses: straight-line rental income (expense), (above)/below market lease and in-place lease amortization, (above)/below market debt and deferred financing costs amortization, depreciation and amortization expense, acquisition fees and transaction costs, loan loss reserves, liability extinguishment gains, impairment, as well as unrealized and realized gain (loss) from sales of real estate and investments. |
(2) | Includes a liability extinguishment gain recorded by the joint venture, of which the Company’s proportionate share totaled $14.1 million. Refer to “Credit Losses and Impairment on Investments” in Note 2, “Summary of Significant Accounting Policies” for additional discussion. |
(3) | Includes a loan loss reserve recorded by the joint venture, of which the Company’s proportionate share totaled $15.8 million. Refer to “Credit Losses and Impairment on Investments” in Note 2, “Summary of Significant Accounting Policies” for additional discussion. |
(4) | Represents the Company’s investment in Solstice. |
5. | Real Estate Debt Investments |
Carrying Value | ||||||||||||||||||
Asset Type: | Principal Amount | September 30, 2018 (Unaudited) | December 31, 2017 | Fixed Rate | Unlevered Current Yield | |||||||||||||
Mezzanine loan(1) | $ | 75,000 | $ | 74,725 | $ | 74,650 | 10.0 | % | 10.3 | % |
(1) | Loan has a final maturity date of January 30, 2021. |
6. | Healthcare-Related Securities |
December 31, 2017 | ||||
Assets | ||||
Senior housing mortgage loans held in a securitization trust, at fair value | $ | 545,048 | ||
Receivables | 2,127 | |||
Total assets | $ | 547,175 | ||
Liabilities | ||||
Senior housing mortgage obligations issued by a securitization trust, at fair value | $ | 512,772 | ||
Accounts payable and accrued expenses | 1,918 | |||
Total liabilities | $ | 514,690 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Statements of Operations | ||||||||||||||||
Interest income on mortgage loans held in a securitized trust | $ | — | $ | 6,536 | $ | 5,149 | $ | 19,503 | ||||||||
Interest expense on mortgage obligations issued by a securitization trust | — | (4,919 | ) | (3,824 | ) | (14,662 | ) | |||||||||
Net interest income | — | 1,617 | 1,325 | 4,841 | ||||||||||||
Other expenses related to securitization trust | — | 981 | (811 | ) | 2,947 | |||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | 384 | — | 1,108 | ||||||||||||
Net income attributable to NorthStar Healthcare Income, Inc. common stockholders | $ | — | $ | 1,020 | $ | 514 | $ | 3,002 |
7. | Borrowings |
September 30, 2018 (Unaudited) | December 31, 2017 | ||||||||||||||||||||
Recourse vs. Non-Recourse | Final Maturity | Contractual Interest Rate(1) | Principal Amount(2) | Carrying Value(2) | Principal Amount(2) | Carrying Value(2) | |||||||||||||||
Mortgage notes payable, net | |||||||||||||||||||||
Peregrine Portfolio(3) | |||||||||||||||||||||
Various locations | Non-recourse | Dec-19 | LIBOR + 3.50% | $ | 16,652 | $ | 16,352 | $ | 23,417 | $ | 23,030 | ||||||||||
Watermark Aqua Portfolio | |||||||||||||||||||||
Denver, CO | Non-recourse | Feb-21 | LIBOR + 2.92% | 20,945 | 20,841 | 21,193 | 21,053 | ||||||||||||||
Frisco, TX | Non-recourse | Mar-21 | LIBOR + 3.04% | 19,531 | 19,438 | 19,755 | 19,630 | ||||||||||||||
Milford, OH | Non-recourse | Sep-26 | LIBOR + 2.68% | 18,760 | 18,270 | 18,760 | 18,216 | ||||||||||||||
Rochester Portfolio | |||||||||||||||||||||
Rochester, NY | Non-recourse | Feb-25 | 4.25% | 21,000 | 20,879 | 21,444 | 21,312 | ||||||||||||||
Rochester, NY(4) | Non-recourse | Aug-27 | LIBOR + 2.34% | 101,224 | 100,136 | 101,224 | 100,061 | ||||||||||||||
Arbors Portfolio(5) | |||||||||||||||||||||
Various locations | Non-recourse | Feb-25 | 3.99% | 91,173 | 89,869 | 92,407 | 90,913 | ||||||||||||||
Watermark Fountains Portfolio(6) | |||||||||||||||||||||
Various locations | Non-recourse | Jun-22 | 3.92% | 401,000 | 398,134 | 410,000 | 406,207 | ||||||||||||||
Various locations | Non-recourse | Jun-22 | 5.56% | 75,401 | 74,776 | 75,401 | 74,776 | ||||||||||||||
Winterfell Portfolio(7) | |||||||||||||||||||||
Various locations | Non-recourse | Jun-25 | 4.17% | 645,634 | 624,267 | 648,211 | 624,656 | ||||||||||||||
Bonaventure Portfolio(8) | |||||||||||||||||||||
Various locations | Non-recourse | Feb-27 | 4.66% | 72,466 | 71,829 | 72,466 | 71,771 | ||||||||||||||
Subtotal mortgage notes payable, net | 1,483,786 | 1,454,791 | 1,504,278 | 1,471,625 | |||||||||||||||||
Other notes payable | |||||||||||||||||||||
Oak Cottage | |||||||||||||||||||||
Santa Barbara, CA | Non-recourse | Feb-22 | 6.00% | 3,500 | 3,500 | 3,500 | 3,500 | ||||||||||||||
Rochester Portfolio | |||||||||||||||||||||
Rochester, NY | Non-recourse | Aug-19 | 6.00% | 12,355 | 12,355 | 12,355 | 12,355 | ||||||||||||||
Subtotal other notes payable, net | 15,855 | 15,855 | 15,855 | 15,855 | |||||||||||||||||
Total mortgage and other notes payable, net | $ | 1,499,641 | $ | 1,470,646 | $ | 1,520,133 | $ | 1,487,480 |
(1) | Floating rate borrowings are comprised of $160.5 million principal amount at one-month London Interbank Offered Rate (“LIBOR”) and $16.7 million principal amount at three-month LIBOR. |
(2) | The difference between principal amount and carrying value of mortgage notes payable is attributable to deferred financing costs, net for all borrowings other than the Winterfell portfolio which is attributable to below market debt intangibles. |
(3) | Mortgage note arrangement is secured and collateralized by three healthcare real estate properties. |
(4) | Comprised of seven individual mortgage notes payable secured by seven healthcare real estate properties, cross-collateralized and cross-defaulted. |
(5) | Comprised of four individual mortgage notes payable secured by four healthcare real estate properties, cross-collateralized and cross-defaulted. |
(6) | Includes $401.0 million principal amount of fixed rate borrowings, secured by 14 healthcare real estate properties, cross-collateralized and cross-defaulted as well as a supplemental financing totaling $75.4 million of principal, secured by seven healthcare real estate properties, cross-collateralized and cross-defaulted. |
(7) | Comprised of 32 individual mortgage notes payable secured by 32 healthcare real estate properties, cross-collateralized and cross-defaulted. |
(8) | Comprised of five individual mortgage notes payable secured by five healthcare real estate properties, cross-collateralized and cross-defaulted. |
October 1 to December 31, 2018 | $ | 5,598 | ||
Years Ending December 31: | ||||
2019 | 52,220 | |||
2020 | 24,345 | |||
2021 | 63,943 | |||
2022 | 464,987 | |||
Thereafter | 888,548 | |||
Total | $ | 1,499,641 |
8. | Related Party Arrangements |
Type of Fee or Reimbursement | Due to Related Party as of December 31, 2017 | Nine Months Ended September 30, 2018 | Due to Related Party as of September 30, 2018 (Unaudited) | |||||||||||||||
Financial Statement Location | Incurred | Paid | ||||||||||||||||
Fees to Advisor Entities | ||||||||||||||||||
Asset management(1) | Asset management and other fees-related party | $ | — | $ | 17,853 | $ | (17,853 | ) | (2) | $ | — | |||||||
Acquisition(2) | Investments in unconsolidated ventures/Asset management and other fees-related party | 8 | (8 | ) | — | — | ||||||||||||
Reimbursements to Advisor Entities | ||||||||||||||||||
Operating costs(3) | General and administrative expenses | 1,038 | 8,621 | (7,168 | ) | 2,491 | ||||||||||||
Total | $ | 1,046 | $ | 26,466 | $ | (25,021 | ) | $ | 2,491 |
(1) | Includes $7.5 million paid in shares of the Company’s common stock. |
(2) | From inception through September 30, 2018, the Advisor waived $0.3 million of acquisition fees related to healthcare-related securities. The Company did not incur any disposition fees during the nine months ended September 30, 2018, nor were any such fees outstanding as of December 31, 2017. |
(3) | As of September 30, 2018, the Advisor does not have any unreimbursed operating costs which remain eligible to be allocated to the Company. |
Portfolio | Partner(s) | Acquisition Date | Ownership | |||
Eclipse | Colony Capital/Formation Capital, LLC | May-2014 | 5.6% | |||
Griffin-American | Colony Capital | Dec-2014 | 14.3% |
9. | Equity-Based Compensation |
10. | Stockholders’ Equity |
Distributions(1) | ||||||||||||
Period | Cash | DRP | Total | |||||||||
2018 | ||||||||||||
January | $ | 2,603 | $ | 2,767 | $ | 5,370 | ||||||
February | 2,384 | 2,448 | 4,832 | |||||||||
March | 2,697 | 2,661 | 5,358 | |||||||||
April | 2,629 | 2,572 | 5,201 | |||||||||
May | 2,731 | 2,626 | 5,357 | |||||||||
June | 2,668 | 2,524 | 5,192 | |||||||||
July | 2,803 | 2,578 | 5,381 | |||||||||
August | 2,813 | 2,550 | 5,363 | |||||||||
September | 2,758 | 2,439 | 5,197 | |||||||||
Total | $ | 24,086 | $ | 23,165 | $ | 47,251 |
(1) | Represents distributions declared for the period, even though such distributions are actually paid to stockholders in the month following such period. |
• | Limit the amount of shares that may be repurchased pursuant to the Share Repurchase Program (including repurchases in the case of death or qualifying disability) as follows: (a) for repurchase requests made during the calendar quarter ending December 31, 2017, $8.0 million in aggregate repurchases and (b) for repurchase requests made in 2018 and thereafter, the lesser of (1) 5% of the weighted average number of shares of the Company’s common stock outstanding during the prior calendar year, less shares repurchased during the current calendar year, or (2) the net proceeds received by the Company during the calendar quarter in which such repurchase requests were made from the sale of shares pursuant to the Company’s DRP; |
• | The price paid for shares will be: (a) for shares repurchased in connection with a death or disability, the lesser of the price paid for the shares or the most recently published estimated value per share, which is currently $8.50 and (b) for all other shares, 90.0% of the Company’s most recently published estimated value per share, which is currently $7.65; and |
• | In the event all repurchase requests in a given quarter could not be satisfied, the Company first repurchased shares submitted in connection with a stockholder’s qualifying death or disability and thereafter repurchased shares pro rata, and the Company sought to honor any unredeemed shares in a future quarter (unless the stockholder withdrew its request). |
11. | Non-controlling Interests |
12. | Fair Value |
Level 1. | Quoted prices for identical assets or liabilities in an active market. |
Level 2. | Financial assets and liabilities whose values are based on the following: |
a) | Quoted prices for similar assets or liabilities in active markets. |
b) | Quoted prices for identical or similar assets or liabilities in non-active markets. |
c) | Pricing models whose inputs are observable for substantially the full term of the asset or liability. |
d) | Pricing models whose inputs are derived principally from or corroborated by observable market data for substantially the full term of the asset or liability. |
Level 3. | Prices or valuation techniques based on inputs that are both unobservable and significant to the overall fair value measurement. |
December 31, 2017 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Financial Assets | |||||||||||||||
Senior housing mortgage loans held in a securitization trust, at fair value | $ | — | $ | — | $ | 545,048 | $ | 545,048 | |||||||
Financial Liabilities | |||||||||||||||
Senior housing mortgage obligations issued by a securitization trust, at fair value | $ | — | $ | 512,772 | $ | — | $ | 512,772 |
Nine Months Ended September 30, 2018 (Unaudited) | Year Ended December 31, 2017 | ||||||
Beginning balance | $ | 545,048 | $ | 553,707 | |||
Purchases/contributions | — | — | |||||
Paydowns/distributions | (4,058 | ) | |||||
Derecognition | (545,048 | ) | — | ||||
Unrealized gain (loss) | — | (4,601 | ) | ||||
Ending balance | $ | — | $ | 545,048 |
Year Ended December 31, 2017 | |||
Beginning balance | $ | 522,933 | |
Transfers to Level 2(1) | (522,933 | ) | |
Paydowns/distributions | — | ||
Sale of investment | — | ||
Unrealized (gain) loss | — | ||
Ending balance | $ | — |
(1) | Transfers to Level 2 from Level 3 represent a fair value measurement from a third-party pricing service or broker quotations that have become more observable during the period. Transfers are assumed to occur at the beginning of the year. |
September 30, 2018 (Unaudited) | December 31, 2017 | ||||||||||||||||||||||
Principal Amount | Carrying Value | Fair Value | Principal Amount | Carrying Value | Fair Value | ||||||||||||||||||
Financial assets:(1) | |||||||||||||||||||||||
Real estate debt investments, net | $ | 75,000 | $ | 74,725 | $ | 75,000 | $ | 75,000 | $ | 74,650 | $ | 75,000 | |||||||||||
Financial liabilities:(1) | |||||||||||||||||||||||
Mortgage and other notes payable, net | $ | 1,499,641 | $ | 1,470,646 | $ | 1,445,360 | $ | 1,520,133 | $ | 1,487,480 | $ | 1,480,407 |
(1) | The fair value of other financial instruments not included in this table is estimated to approximate their carrying value. |
13. | Segment Reporting |
• | Real Estate Equity - Focused on equity investments, directly or through joint ventures, with a focus on properties in the mid-acuity senior housing sector, which the Company defines as ALF, MCF, SNF, ILF and CCRC. The Company’s equity investments may also include MOB, hospitals, rehabilitation facilities and ancillary healthcare services businesses. The Company’s investments are predominantly in the United States, but it also selectively makes international investments. The Company’s healthcare properties generally operate under net leases or through management agreements with independent third-party operators. |
• | Real Estate Debt - Focused on originating, acquiring and asset managing healthcare-related debt investments and may include first mortgage loans, subordinate interests and mezzanine loans and participations in such loans, as well as preferred equity interests. |
• | Healthcare-Related Securities - Focused on investing in and asset managing healthcare-related securities primarily consisting of CMBS, commercial mortgage obligations and other securities backed primarily by loans secured by healthcare properties. |
• | Corporate - The corporate segment includes corporate level asset management and other fees - related party and general and administrative expenses. |
Nine Months Ended September 30, 2018 | |||||||||||||
Operator / Tenant | Properties Under Management | Units Under Management(1) | Property and Other Revenues | % of Total Property and Other Revenues | |||||||||
Watermark Retirement Communities | 29 | 5,225 | $ | 115,463 | 52.4 | % | |||||||
Solstice Senior Living | (2) | 32 | 4,000 | 79,350 | 36.0 | % | |||||||
Avamere Health Services | (3) | 5 | 453 | 12,541 | 5.7 | % | |||||||
Arcadia Management | 4 | 572 | 7,961 | 3.6 | % | ||||||||
Integral Senior Living | (2) | 3 | 162 | 3,852 | 1.7 | % | |||||||
Peregrine Senior Living | 2 | 114 | 1,114 | 0.5 | % | ||||||||
Senior Lifestyle Corporation | (4) | 2 | 115 | (195 | ) | (0.1 | )% | ||||||
Other | (5) | — | — | 464 | 0.2 | % | |||||||
Total | 77 | 10,641 | $ | 220,550 | 100.0 | % |
(1) | Represents rooms for ALF and ILF and beds for MCF and SNF, based on predominant type. |
(2) | Solstice Senior Living, LLC is a joint venture of which affiliates of Integral Senior Living own 80%. |
(3) | Effective February 2018, properties under the management of Bonaventure were transitioned to Avamere Health Services. |
(4) | As a result of the tenant failing to remit rental payments, the Company accelerated the amortization of capitalized lease inducements. |
(5) | Represents interest income earned on corporate-level cash accounts. |
Statement of Operations: | ||||||||||||||||
Three Months Ended September 30, 2018(1) | Real Estate Equity | Real Estate Debt | Corporate(2) | Total | ||||||||||||
Rental and resident fee income | $ | 72,455 | $ | — | $ | — | $ | 72,455 | ||||||||
Net interest income on debt and securities | — | 1,943 | — | 1,943 | ||||||||||||
Other revenue | 846 | — | 169 | 1,015 | ||||||||||||
Property operating expenses | (47,355 | ) | — | — | (47,355 | ) | ||||||||||
Interest expense | (17,595 | ) | — | (82 | ) | (17,677 | ) | |||||||||
Other expenses related to securitization trust | — | — | — | — | ||||||||||||
Transaction costs | — | — | — | — | ||||||||||||
Asset management and other fees - related party | — | — | (5,951 | ) | (5,951 | ) | ||||||||||
General and administrative expenses | (232 | ) | (10 | ) | (2,576 | ) | (2,818 | ) | ||||||||
Depreciation and amortization | (25,629 | ) | — | — | (25,629 | ) | ||||||||||
Impairment loss | — | — | — | — | ||||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | — | — | — | ||||||||||||
Realized gain (loss) on investments and other | 726 | — | — | 726 | ||||||||||||
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense) | (16,784 | ) | 1,933 | (8,440 | ) | (23,291 | ) | |||||||||
Equity in earnings (losses) of unconsolidated ventures | 16,631 | — | — | 16,631 | ||||||||||||
Income tax benefit (expense) | (10 | ) | — | — | (10 | ) | ||||||||||
Net income (loss) | $ | (163 | ) | $ | 1,933 | $ | (8,440 | ) | $ | (6,670 | ) |
(1) | For the three months ended September 30, 2018, the Company did not have activity in the healthcare-related securities segment as a result of having sold the Class B certificates of its consolidated Investing VIE in March 2018 and no longer having to consolidate the related interest income and interest expense on the consolidated statements of operations. |
(2) | Includes unallocated asset management fee-related party and general and administrative expenses. |
Three Months Ended September 30, 2017 | Real Estate Equity | Real Estate Debt | Healthcare-Related Securities | Corporate(1) | Subtotal | Investing VIE(2) | Total | |||||||||||||||||||||
Rental and resident fee income | $ | 73,740 | $ | — | $ | — | $ | — | $ | 73,740 | $ | — | $ | 73,740 | ||||||||||||||
Net interest income on debt and securities | — | 1,940 | 1,025 | (3) | (389 | ) | (3) | 2,576 | 981 | 3,557 | ||||||||||||||||||
Other revenue | 541 | — | — | 120 | 661 | — | 661 | |||||||||||||||||||||
Property operating expenses | (42,981 | ) | — | — | — | (42,981 | ) | — | (42,981 | ) | ||||||||||||||||||
Interest expense | (15,687 | ) | — | — | — | (15,687 | ) | — | (15,687 | ) | ||||||||||||||||||
Other expenses related to securitization trust | — | — | — | — | — | (981 | ) | (981 | ) | |||||||||||||||||||
Transaction costs | (3,814 | ) | — | — | — | (3,814 | ) | — | (3,814 | ) | ||||||||||||||||||
Asset management and other fees - related party | — | — | — | (13,299 | ) | (13,299 | ) | — | (13,299 | ) | ||||||||||||||||||
General and administrative expenses | (262 | ) | (12 | ) | — | (2,767 | ) | (3,041 | ) | — | (3,041 | ) | ||||||||||||||||
Depreciation and amortization | (24,454 | ) | — | — | — | (24,454 | ) | — | (24,454 | ) | ||||||||||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | — | (5 | ) | 389 | 384 | — | 384 | ||||||||||||||||||||
Realized gain (loss) on investments and other | — | — | — | — | — | — | — | |||||||||||||||||||||
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense) | (12,917 | ) | 1,928 | 1,020 | (15,946 | ) | (25,915 | ) | — | (25,915 | ) | |||||||||||||||||
Equity in earnings (losses) of unconsolidated ventures | (18,557 | ) | — | — | — | (18,557 | ) | — | (18,557 | ) | ||||||||||||||||||
Income tax benefit (expense) | (15 | ) | — | — | — | (15 | ) | — | (15 | ) | ||||||||||||||||||
Net income (loss) | $ | (31,489 | ) | $ | 1,928 | $ | 1,020 | $ | (15,946 | ) | $ | (44,487 | ) | $ | — | $ | (44,487 | ) |
(1) | Includes unallocated asset management fee-related party and general and administrative expenses. |
(2) | Investing VIEs are not considered to be a segment that the Company conducts its business through, however U.S. GAAP requires the Company, as the primary beneficiary, to present the assets and liabilities of the securitization trust on its consolidated balance sheets and recognize the related interest income and interest expense, as net interest income on the consolidated statements of operations. Though U.S. GAAP requires this presentation, the Company views its investment in the securitization trust as a net investment in healthcare-related securities. |
(3) | Represents income earned from the healthcare-related securities purchased at a discount, recognized using the effective interest method had the transaction been recorded as an available for sale security, at amortized cost. During the three months ended September 30, 2017, $0.4 million was attributable to discount accretion income and was eliminated in consolidation in the corporate segment. |
Statement of Operations: | ||||||||||||||||||||||||||||
Nine Months Ended September 30, 2018 | Real Estate Equity | Real Estate Debt | Healthcare-Related Securities | Corporate(1) | Subtotal | Investing VIE(2) | Total | |||||||||||||||||||||
Rental and resident fee income | $ | 217,858 | $ | — | $ | — | $ | — | $ | 217,858 | $ | — | $ | 217,858 | ||||||||||||||
Net interest income on debt and securities | — | 5,763 | 828 | (3) | (314 | ) | (3) | 6,277 | 811 | 7,088 | ||||||||||||||||||
Other revenue | 2,228 | — | — | 464 | 2,692 | — | 2,692 | |||||||||||||||||||||
Property operating expenses | (141,510 | ) | — | — | — | (141,510 | ) | — | (141,510 | ) | ||||||||||||||||||
Interest expense | (52,215 | ) | — | — | (193 | ) | (52,408 | ) | — | (52,408 | ) | |||||||||||||||||
Other expenses related to securitization trust | — | — | — | — | — | (811 | ) | (811 | ) | |||||||||||||||||||
Transaction costs | (806 | ) | — | — | — | (806 | ) | — | (806 | ) | ||||||||||||||||||
Asset management and other fees - related party | — | — | — | (17,845 | ) | (17,845 | ) | — | (17,845 | ) | ||||||||||||||||||
General and administrative expenses | (734 | ) | (29 | ) | (5 | ) | (9,159 | ) | (9,927 | ) | — | (9,927 | ) | |||||||||||||||
Depreciation and amortization | (81,943 | ) | — | — | — | (81,943 | ) | — | (81,943 | ) | ||||||||||||||||||
Impairment loss | (5,239 | ) | — | — | — | (5,239 | ) | — | (5,239 | ) | ||||||||||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | — | (314 | ) | 314 | — | — | — | ||||||||||||||||||||
Realized gain (loss) on investments and other | 726 | — | 3,495 | — | 4,221 | — | 4,221 | |||||||||||||||||||||
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense) | (61,635 | ) | 5,734 | 4,004 | (26,733 | ) | (78,630 | ) | — | (78,630 | ) | |||||||||||||||||
Equity in earnings (losses) of unconsolidated ventures | 3,907 | — | — | — | 3,907 | — | 3,907 | |||||||||||||||||||||
Income tax benefit (expense) | (40 | ) | — | — | — | (40 | ) | — | (40 | ) | ||||||||||||||||||
Net income (loss) | $ | (57,768 | ) | $ | 5,734 | $ | 4,004 | $ | (26,733 | ) | $ | (74,763 | ) | $ | — | $ | (74,763 | ) |
(1) | Includes unallocated asset management fee-related party and general and administrative expenses. |
(2) | Investing VIEs are not considered to be a segment that the Company conducts its business through, however U.S. GAAP requires the Company, as the primary beneficiary, to present the assets and liabilities of the securitization trust on its consolidated balance sheets and recognize the related interest income and interest expense, as net interest income on the consolidated statements of operations. Though U.S. GAAP requires this presentation, the Company views its investment in the securitization trust as a net investment in healthcare-related securities. |
(3) | Represents income earned from the healthcare-related securities purchased at a discount, recognized using the effective interest method had the transaction been recorded as an available for sale security, at amortized cost. During the nine months ended September 30, 2018, $0.3 million was attributable to discount accretion income and was eliminated in consolidation in the corporate segment. |
Nine Months Ended September 30, 2017 | Real Estate Equity | Real Estate Debt | Healthcare-Related Securities | Corporate(1) | Subtotal | Investing VIE(2) | Total | |||||||||||||||||||||
Rental and resident fee income | $ | 207,249 | $ | — | $ | — | $ | — | $ | 207,249 | $ | — | $ | 207,249 | ||||||||||||||
Net interest income on debt and securities | — | 5,755 | 3,016 | (3) | (1,122 | ) | (3) | 7,649 | 2,947 | 10,596 | ||||||||||||||||||
Other revenue | 1,595 | — | — | 596 | 2,191 | — | 2,191 | |||||||||||||||||||||
Property operating expenses | (118,526 | ) | — | — | — | (118,526 | ) | — | (118,526 | ) | ||||||||||||||||||
Interest expense | (44,479 | ) | — | — | — | (44,479 | ) | — | (44,479 | ) | ||||||||||||||||||
Other expenses related to securitization trust | — | — | — | — | — | (2,947 | ) | (2,947 | ) | |||||||||||||||||||
Transaction costs | (6,778 | ) | — | — | — | (6,778 | ) | — | (6,778 | ) | ||||||||||||||||||
Asset management and other fees - related party | — | — | — | (32,716 | ) | (32,716 | ) | — | (32,716 | ) | ||||||||||||||||||
General and administrative expenses | (682 | ) | (39 | ) | — | (7,671 | ) | (8,392 | ) | — | (8,392 | ) | ||||||||||||||||
Depreciation and amortization | (69,223 | ) | — | — | — | (69,223 | ) | — | (69,223 | ) | ||||||||||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | — | (14 | ) | 1,122 | 1,108 | — | 1,108 | ||||||||||||||||||||
Realized gain (loss) on investments and other | 118 | — | — | — | 118 | — | 118 | |||||||||||||||||||||
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense) | (30,726 | ) | 5,716 | 3,002 | (39,791 | ) | (61,799 | ) | — | (61,799 | ) | |||||||||||||||||
Equity in earnings (losses) of unconsolidated ventures | (31,234 | ) | — | — | — | (31,234 | ) | — | (31,234 | ) | ||||||||||||||||||
Income tax benefit (expense) | (56 | ) | — | — | — | (56 | ) | — | (56 | ) | ||||||||||||||||||
Net income (loss) | $ | (62,016 | ) | $ | 5,716 | $ | 3,002 | $ | (39,791 | ) | $ | (93,089 | ) | $ | — | $ | (93,089 | ) |
(1) | Includes unallocated asset management fee-related party and general and administrative expenses. |
(2) | Investing VIEs are not considered to be a segment through which the Company conducts business, however U.S. GAAP requires the Company, as the primary beneficiary, to present the assets and liabilities of the securitization trust on its consolidated balance sheets and recognize the related interest income and interest expense, as net interest income on the consolidated statements of operations. Though U.S. GAAP requires this presentation, the Company views its investment in the securitization trust as a net investment in healthcare-related securities. |
(3) | Represents income earned from the healthcare-related securities purchased at a discount, recognized using the effective interest method had the transaction been recorded as an available for sale security, at amortized cost. During the nine months ended September 30, 2017, $1.1 million was attributable to discount accretion income and was eliminated in consolidation in the corporate segment. |
Total Assets: | Real Estate Equity(1) | Real Estate Debt | Healthcare-Related Securities | Corporate(2) | Subtotal | Investing VIEs(3) | Total | |||||||||||||||||||||
September 30, 2018 (Unaudited) | $ | 2,245,420 | $ | 75,350 | $ | — | $ | 29,304 | $ | 2,350,074 | $ | — | $ | 2,350,074 | ||||||||||||||
December 31, 2017 | 2,339,873 | 75,296 | 32,484 | 3,925 | 2,451,578 | 547,175 | 2,998,753 |
(1) | Includes investments in unconsolidated joint ventures totaling $322.5 million and $325.6 million as of September 30, 2018 and December 31, 2017, respectively. |
(2) | Represents corporate cash and cash equivalent balances. These balances are partially offset by elimination of healthcare-related securities in consolidation as of December 31, 2017. |
(3) | Investing VIEs are not considered to be a segment through which the Company conducts business, however U.S. GAAP requires the Company, as the primary beneficiary, to present the assets and liabilities of the securitization trust on its consolidated balance sheets and recognize the related interest income and interest expense, as net interest income on the consolidated statements of operations. Though U.S. GAAP requires this presentation, the Company’s management and chief decision makers view the Company’s investment in the securitization trust as a net investment in healthcare-related securities. As such, the Company has presented the statements of operations and balance sheets within this note in a manner consistent with the views of the Company’s management and chief decision makers. |
14. | Commitments and Contingencies |
15. | Subsequent Events |
• | Ongoing, industry-wide declines in occupancy and rate increases predominantly as a result of supply growth; |
• | Tightening labor markets and select statutory wage increases resulting in expense increases for labor and benefits; |
• | Unfavorable seasonal conditions, driving higher costs for utilities and maintenance; |
• | A particularly severe flu season, with the Center for Disease Control (CDC) reporting an increase in the percentage of outpatient visits due to Influenza-like Illness (ILI) that approached the peak seen in 2009-2010; and |
• | Disruptions and related expenses due to operator transitions, particularly for the Winterfell (transition began in November 2017) and Rochester portfolios (operator transition began upon acquisition in 2017). Elevated expenses and operational disruptions continue to impact operating performance after completion of the transitions. |
• | In March 2018, we sold our investment in the Freddie Mac securitization, generating net proceeds of $35.8 million. We originally purchased the investment for $30.5 million. |
• | In March 2018, we contributed $4.5 million to the Trilogy portfolio for approved business initiatives, including senior housing campus development. During the nine months ended September 30, 2018, we received distributions from Trilogy totaling $4.8 million. |
• | In August 2018, we completed the disposition of Fountains at Franklin, a non-core, consolidated operating property within the Watermark Fountains portfolio. The sales price of $12.0 million generated net proceeds of $2.7 million to the joint venture, after repayment of mortgage debt and transaction costs. |
• | In October 2018, we sold 20.0% of our ownership interest in the Trilogy joint venture, which generated gross proceeds of $48.0 million and reduced our ownership interest in the joint venture from approximately 29% to 23%. We sold the ownership interest to a wholly owned subsidiary of the operating partnership of Griffin-American Healthcare REIT IV, Inc., a REIT sponsored by AHI. |
• | In January 2018, we made a partial repayment to the Peregrine mortgage loan totaling $6.4 million, which released one property from the collateral pool and cured the outstanding non-monetary default. |
• | In March 2018, we satisfied all post-closing obligations, including the pledge of borrowing base assets, under a corporate credit facility with Key Bank, or our Corporate Facility. In addition, we amended our revolving line of credit from an affiliate of our Sponsor, or our Sponsor Line, to extend the maturity consistent with the Corporate Facility and make other conforming changes to the events of default. |
• | In August 2018, in connection with the property sale in the Watermark Fountains portfolio, we repaid a mortgage note payable of $9.0 million. |
• | Our board of directors approved a daily cash distribution of $0.000924658 per share of common stock for each of the nine months ended September 30, 2018. |
• | In October 2018, our board of directors approved an amended and restated Share Repurchase Program, under which we will only repurchase shares in connection with the death or qualifying disability of a stockholder. |
• | In February 2018, we began the transition of operations of the Bonaventure portfolio from the former manager, an affiliate of Bonaventure Senior Living, to a new manager, Avamere. |
• | Development and construction of the memory care facility adjacent to the Pinebrook facility continued throughout 2018 to date, with a projected completion date in the fourth quarter of 2018. |
• | During the first three quarters of 2018, the Espresso joint venture continued the process of transitioning operators within three of its sub-portfolios. As of September 2018, all three sub-portfolios successfully executed their operator transition plans. During this period, the joint venture sold one operating facility and one remains held for sale. |
• | On a same store basis (which excludes properties purchased during 2017), rental and resident fee income, net of property operating expenses, of our consolidated equity investment portfolios decreased to $23.3 million for the three months ended September 30, 2018 as compared to $26.8 million for the three months ended September 30, 2017, and increased as compared to $21.4 million for the three months ended June 30, 2018. |
• | On a same store basis, rental and resident fee income, net of property operating expenses, decreased to $69.5 million for the nine months ended September 30, 2018 as compared to $81.1 million for the nine months ended September 30, 2017. Declines in average occupancy and rising labor costs, most significantly in the Winterfell portfolio, were the primary drivers of the decrease in both the three and nine months ended September 30, 2018. |
• | The Winterfell portfolio’s occupancy increased to an average of 79.6% in the third quarter of 2018 from 78.6% in the second quarter of 2018. However, the average occupancy for the third quarter of 2018 remains below the 87.4% average occupancy achieved in the third quarter of 2017. In November 2017, we began the transition of management for the Winterfell portfolio to Solstice Senior Living (“Solstice”). This portfolio represents 32 of the 49 communities that underwent tenant, manager and/or operator transitions within our consolidated portfolios beginning in 2017 and continuing into early 2018. The portfolio continues to experience the inherent challenges and obstacles that occur with an operator transition of this size and complexity. Our management team is working closely with Solstice and the rest of our operating partners to implement focused and strategic plans to increase occupancy and improve performance in this challenging market. |
• | Real Estate Equity - Our equity investments, which may be owned directly or through joint ventures, include independent living facilities, or ILF, assisted living facilities, or ALF, memory care facilities, or MCF, continuing care retirement communities, or CCRC, which we collectively refer to as senior housing facilities, skilled nursing facilities, or SNF, medical office buildings, or MOB, and hospitals. Our healthcare properties are typically operated under net leases or pursuant to management agreements with healthcare operators. As of September 30, 2018, 97.9% of our investments were invested in healthcare real estate equity, either directly or through joint ventures. |
• | Real Estate Debt - Our debt investments may include mortgage loans or mezzanine loans to owners of healthcare real estate. As of September 30, 2018, we had one mezzanine loan, which represented 2.1% of our investments. |
• | Healthcare-Related Securities - Our securities investments may include commercial mortgage backed securities, or CMBS, backed primarily by loans secured by healthcare properties. We disposed of our investment in a Freddie Mac securitization trust in March 2018. |
Investment Type: | Count(1) | Amount(2)(3) | % of Total | Capacity | Primary Locations | ||||||||||
Real estate equity(4) | |||||||||||||||
MOB | 108 | $ | 187,486 | 5.3 | % | 3.8 million | square feet | IL, GA, OH, TX, IN | |||||||
Net lease | |||||||||||||||
Senior housing facilities(5) | 86 | 578,571 | 16.2 | % | 6,260 | units | NY, CA, FL, UK, WA | ||||||||
SNF | 231 | 441,644 | 12.4 | % | 24,843 | beds | PA, MI, KY, IN, WI | ||||||||
Hospitals | 14 | 40,772 | 1.1 | % | 872 | beds | CA, TX, MO, UT, GA | ||||||||
Operating | |||||||||||||||
Senior housing facilities(5) | 142 | 1,854,533 | 52.1 | % | 13,701 | units | CA, WA, TX, NY, IL | ||||||||
SNF | 73 | 382,536 | 10.7 | % | 8,036 | beds | IN, OH, MI, KY, MA | ||||||||
Ancillary(6) | NA | 2,214 | 0.1 | % | N/A | ||||||||||
Total real estate equity | 654 | 3,487,756 | 97.9 | % | |||||||||||
Real estate debt | |||||||||||||||
Mezzanine loan | 1 | 75,000 | 2.1 | % | |||||||||||
Total real estate debt | 1 | 75,000 | 2.1 | % | |||||||||||
Corporate investments | |||||||||||||||
Operator platform(7) | 1 | 2 | — | % | |||||||||||
Total corporate investments | 1 | 2 | — | % | |||||||||||
Total investments | 656 | $ | 3,562,758 | 100.0 | % |
(1) | For real estate equity, the count represents the number of properties. For real estate debt, the count represents the number of respective financial instruments. Does not include properties held for sale. |
(2) | Based on cost for real estate equity investments, which includes purchase price allocations related to net intangibles, deferred costs, other assets, if any, and adjusted for subsequent capital expenditures. Does not include cost of properties held for sale. For real estate debt, based on principal amount. For real estate equity investments, includes cost associated with purchased land parcels that are not included in the count. |
(3) | Includes our proportionate interest in the underlying real estate held through unconsolidated joint ventures of $1.3 billion. |
(4) | Classification of investment type based on predominant services provided, but may include other services. |
(5) | Includes ALF, MCF, ILF and CCRC. |
(6) | Includes institutional pharmacy in connection with the Trilogy investment. |
(7) | Represents investment in Solstice. In November 2017, we began the transition of operations of the Winterfell portfolio, from the former manager, an affiliate of Holiday Retirement, to a new manager, Solstice. Solstice is a joint venture between affiliates of Integral Senior Living, LLC, a leading management company of ILF, ALF and MCF founded in 2000, which owns 80.0%, and us, who owns 20.0%. |
• | Senior Housing. We define senior housing to include ILFs, ALFs, MCFs and CCRCs, as described in further detail below. Revenues generated by senior housing facilities typically come from private pay sources, including private insurance, and to a much lesser extent government reimbursement programs, such as Medicare and Medicaid. |
◦ | Assisted living facilities. ALFs provide services that include minimal assistance for activities in daily living and permit residents to maintain some of their privacy and independence as they do not require constant supervision and assistance. Services bundled within one regular monthly fee usually include three meals per day in a central dining room, daily housekeeping, laundry, medical reminders and 24-hour availability of assistance with the activities of daily living, such as eating, dressing and bathing. Professional nursing and healthcare services are usually available at the facility on call or at regularly scheduled times. ALFs typically are comprised of one and two bedroom suites equipped with private bathrooms and efficiency kitchens. |
◦ | Independent living facilities. ILFs are age-restricted multi-family properties with central dining facilities that provide services that include security, housekeeping, nutrition and limited laundry services. ILFs are designed specifically for independent seniors who are able to live on their own, but desire the security and conveniences of community living. ILFs typically offer several services covered under a regular monthly fee. |
◦ | Memory care facilities. MCFs offer specialized options for seniors with Alzheimer’s disease and other forms of dementia. Purpose built, free-standing memory care facilities offer an attractive alternative for private-pay residents affected by memory loss in comparison to other accommodations that typically have been provided within a secured unit of an ALF or SNF. These facilities offer dedicated care and specialized programming for various conditions relating to memory loss in a secured environment that is typically smaller in scale and more residential in nature than traditional assisted living facilities. Residents require a higher level of care and more assistance with activities of daily living than in assisted living facilities. Therefore, these facilities have staff available 24 hours a day to respond to the unique needs of their residents. |
◦ | Continuing care retirement community. CCRCs provide, as a continuum of care, the services described for ILFs, ALFs and SNFs in an integrated campus, generally under contracts with the residents (frequently lasting the term of the resident’s lifetime). |
• | Skilled Nursing Facilities. SNFs provide services that include daily nursing, therapeutic rehabilitation, social services, housekeeping, nutrition and administrative services for individuals requiring certain assistance for activities in daily living. A typical SNF includes mostly one and two bed units, each equipped with a private or shared bathroom and community dining facilities. Revenues generated from SNFs typically come from government reimbursement programs, including Medicare and Medicaid, as well as private pay sources, including private insurance. |
• | Medical Office Buildings. MOBs are typically either single-tenant properties associated with a specialty group or multi-tenant properties leased to several unrelated medical practices. Tenants include physicians, dentists, psychologists, therapists and other healthcare providers, who require space devoted to patient examination and treatment, diagnostic imaging, outpatient surgery and other outpatient services. MOBs are similar to commercial office buildings, although they require greater plumbing, electrical and mechanical systems to accommodate physicians’ requirements such as sinks in every room, brighter lights and specialized medical equipment. |
• | Hospitals. Services provided by operators and tenants in hospitals are paid for by private sources, third-party payers (e.g., insurance and Health Maintenance Organizations), or through the Medicare and Medicaid programs. Our hospital properties typically will include acute care, long-term acute care, specialty and rehabilitation hospitals and generally are leased to single tenants or operators under triple-net lease structures. |
Real Estate Equity by Property Type(1) | Real Estate Equity by Geographic Location | |
(1) | Classification based on predominant services provided, but may include other services. |
Properties(1) | ||||||||||||||||||||
Portfolio | Investment Structure | Amount(2) | Senior Housing Facilities | MOB | SNF | Hospitals | Total | Primary Locations | Ownership Interest | |||||||||||
Direct Investments | ||||||||||||||||||||
Watermark Aqua | Operating Facilities | $ | 115,379 | 4 | — | — | — | 4 | West/Southwest/Midwest | 97.0% | ||||||||||
Peregrine | Net Lease | 36,498 | 4 | — | — | — | 4 | Northeast/Southeast | 100.0% | |||||||||||
Kansas City | Operating Facilities | 15,000 | 2 | — | — | — | 2 | Midwest | 100.0% | |||||||||||
Arbors | Net Lease | 126,825 | 4 | — | — | — | 4 | Northeast | 100.0% | |||||||||||
Watermark Fountains(3) | Net Lease/Operating Facilities | 645,751 | 15 | — | — | — | 15 | Various | Various | |||||||||||
Winterfell | Operating Facilities | 904,985 | 32 | — | — | — | 32 | Various | 100.0% | |||||||||||
Bonaventure | Operating Facilities | 99,438 | 5 | — | — | — | 5 | Northwest | 100.0% | |||||||||||
Oak Cottage | Operating Facilities | 19,427 | 1 | — | — | — | 1 | West | 100.0% | |||||||||||
Rochester | Operating Facilities | 219,518 | 10 | — | — | — | 10 | Northeast | 97.0% | |||||||||||
Total Direct Investments | 2,182,821 | 77 | — | — | — | 77 | ||||||||||||||
Joint Venture Investments(4) | ||||||||||||||||||||
Eclipse | Net Lease/Operating Facilities | 56,540 | 44 | — | 32 | — | 76 | Various | 5.6% | |||||||||||
Envoy | Net Lease | 13,138 | — | — | 11 | — | 11 | Mid - Atlantic/Northeast | 11.4% | |||||||||||
Griffin-American | Net Lease/Operating Facilities | 475,861 | 92 | 108 | 41 | 14 | 255 | Various | 14.3% | |||||||||||
Espresso | Net Lease | 320,373 | 6 | — | 150 | — | 156 | Various | 36.7% | |||||||||||
Trilogy(5) | Operating Facilities | 439,023 | 9 | — | 70 | — | 79 | Various | 29.0% | |||||||||||
Total Joint Venture Investments | 1,304,935 | 151 | 108 | 304 | 14 | 577 | ||||||||||||||
Total | $ | 3,487,756 | 228 | 108 | 304 | 14 | 654 |
(1) | Classification based on predominant services provided, but may include other services. |
(2) | Includes purchase price allocations related to net intangibles, deferred costs, other assets, if any, and adjusted for subsequent capital expenditures. |
(3) | Watermark Fountains portfolio consists of six wholly-owned net lease properties totaling $288.8 million and nine operating facilities totaling $356.9 million, in which we own a 97.0% interest. One of these properties consists of 11 condominium units in which we hold future interests, or the Remainder Interests. |
(4) | Represents our proportionate interest in real estate assets held through unconsolidated joint ventures. |
(5) | Includes institutional pharmacy, which are not subject to property count. |
• | Trilogy. We own a 29.0% interest in a $1.5 billion portfolio, based on cost, of predominantly SNFs located in the Midwest and operated pursuant to management agreements with Trilogy Health Services, as well as ancillary services businesses, including a therapy business and a pharmacy business. Griffin-American Healthcare REIT III, Inc., or GAHR 3, and management of Trilogy own the remaining 71.0% of this portfolio. For additional information, refer to Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Recent Developments.” |
• | Griffin-American. We own a 14.3% interest in a $3.3 billion portfolio, based on cost, of SNFs, ALFs, MOBs and hospitals across the United States and care homes in the United Kingdom. Our Sponsor owns the remaining 85.7% of this portfolio. |
• | Espresso. We own a 36.7% interest in a $0.9 billion portfolio, based on cost, of predominantly SNFs, located in various regions across the United States, and organized in six sub-portfolios and currently leased to nine different operators under net leases. An affiliate of Formation Capital, or Formation, acts as the general partner and manager of this investment. We also have a mezzanine loan relating to this portfolio. Refer to “—Real Estate Debt Overview” below. |
• | Eclipse. We own a 5.6% interest in a $1.0 billion portfolio, based on cost, of SNFs and ALFs leased to, or managed by, a variety of different operators across the United States. Our Sponsor and Formation own 86.4% and 8.0% of this portfolio, respectively. |
• | Envoy. We own an 11.4% interest in a $0.1 billion portfolio, based on cost, of SNFs located in the Mid-Atlantic region and operated by a single operator. Formation acts as the general partner and manager of this investment. |
Nine Months Ended September 30, 2018 | |||||||||||||
Operator / Tenant | Properties Under Management | Units Under Management(1) | Property and Other Revenues | % of Total Property and Other Revenues | |||||||||
Watermark Retirement Communities | 29 | 5,225 | $ | 115,463 | 52.4 | % | |||||||
Solstice Senior Living | (2) | 32 | 4,000 | 79,350 | 36.0 | % | |||||||
Avamere Health Services | (3) | 5 | 453 | 12,541 | 5.7 | % | |||||||
Arcadia Management | 4 | 572 | 7,961 | 3.6 | % | ||||||||
Integral Senior Living | (2) | 3 | 162 | 3,852 | 1.7 | % | |||||||
Peregrine Senior Living | 2 | 114 | 1,114 | 0.5 | % | ||||||||
Senior Lifestyle Corporation | (4) | 2 | 115 | (195 | ) | (0.1 | )% | ||||||
Other | (5) | — | — | 464 | 0.2 | % | |||||||
Total | 77 | 10,641 | $ | 220,550 | 100.0 | % |
(1) | Represents rooms for ALF and ILF and beds for MCF and SNF, based on predominant type. |
(2) | Solstice Senior Living, LLC is a joint venture of which affiliates of Integral Senior Living own 80%. |
(3) | Effective February 2018, properties under the management of Bonaventure were transitioned to Avamere Health Services. |
(4) | As a result of the tenant failing to remit rental payments, we accelerated the amortization of capitalized lease inducements. |
(5) | Represents interest income earned on corporate-level cash accounts. |
Investment Type: | Count | Principal Amount | Carrying Value | Fixed Rate | Unleveraged Current Yield | |||||||||||
Espresso Mezzanine loan(1) | 1 | $ | 75,000 | $ | 74,725 | 10.0 | % | 10.3 | % |
(1) | Property types securing the mezzanine loan predominately include SNFs, which are located primarily in the Midwest, Northeast and Southeast regions of the United States. |
• | Maintain a Diversified Portfolio. We believe that mid-acuity senior housing facilities provide an opportunity to generate risk-adjusted returns and benefit from positive future demographic trends. In addition, we believe that maintaining a |
• | Pursue Strategic Capital Expenditures and Development Opportunities. We will continue to invest capital into our operating portfolio in order to maintain market position as well as functional and operating standards. In addition, we will continue to execute on and identify strategic development opportunities for our existing investments that may involve replacing, converting or renovating facilities in our portfolio which, in turn, would allow us to provide an optimal mix of services and enhance the overall value of our assets. |
• | Execute on Our Operator Transition Plan and Stabilize Our Portfolio. We have been and are currently in the process of transitioning several of our portfolios to new operators or managers, both as a result of execution of our business plan in connection with recent acquisitions and to reposition properties as a result of performance issues by certain operators or managers. Refer to “—Operators and Managers” above. |
• | Assess Opportunities for Asset Repositioning. As the healthcare industry evolves, we will continue to assess the need for strategic asset repositioning, including evaluating assets, operators and markets to position our portfolio for optimal performance. Our strategy includes potentially selling and transitioning assets that do not meet our operator, real estate or market criteria or overall portfolio management strategy. |
• | Consider Selective Dispositions. We will consider selective dispositions of assets in connection with strategic repositioning of assets or otherwise where we believe the disposition will achieve a desired return or opportunities exist to enhance overall returns. |
• | Financing Strategy. We use asset-level financing as part of our investment strategy to leverage our investments while managing refinancing and interest rate risk. We typically finance our investments with medium to long-term, non-recourse mortgage loans, though our borrowing levels and terms vary depending upon the nature of the assets and the related financing. In addition, we have a revolving line of credit to provide additional short-term liquidity as needed. Refer to “—Liquidity and Capital Resources” for additional information. |
Three Months Ended September 30, | Increase (Decrease) | ||||||||||||||
2018 | 2017 | Amount | % | ||||||||||||
Property and other revenues | |||||||||||||||
Resident fee income | $ | 32,469 | $ | 33,233 | $ | (764 | ) | (2.3 | )% | ||||||
Rental income | 39,986 | 40,507 | (521 | ) | (1.3 | )% | |||||||||
Other revenue | 1,015 | 661 | 354 | 53.6 | % | ||||||||||
Total property and other revenues | 73,470 | 74,401 | (931 | ) | (1.3 | )% | |||||||||
Net interest income | |||||||||||||||
Interest income on debt investments | 1,943 | 1,940 | 3 | 0.2 | % | ||||||||||
Interest income on mortgage loans held in a securitized trust | — | 6,536 | (6,536 | ) | (100.0 | )% | |||||||||
Interest expense on mortgage obligations issued by a securitization trust | — | (4,919 | ) | 4,919 | (100.0 | )% | |||||||||
Net interest income | 1,943 | 3,557 | (1,614 | ) | (45.4 | )% | |||||||||
Expenses | |||||||||||||||
Real estate properties - operating expenses | 47,355 | 42,981 | 4,374 | 10.2 | % | ||||||||||
Interest expense | 17,677 | 15,687 | 1,990 | 12.7 | % | ||||||||||
Other expenses related to securitization trust | — | 981 | (981 | ) | (100.0 | )% | |||||||||
Transaction costs | — | 3,814 | (3,814 | ) | (100.0 | )% | |||||||||
Asset management and other fees-related party | 5,951 | 13,299 | (7,348 | ) | (55.3 | )% | |||||||||
General and administrative expenses | 2,818 | 3,041 | (223 | ) | (7.3 | )% | |||||||||
Depreciation and amortization | 25,629 | 24,454 | 1,175 | 4.8 | % | ||||||||||
Total expenses | 99,430 | 104,257 | (4,827 | ) | (4.6 | )% | |||||||||
Other income (loss) | |||||||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | 384 | (384 | ) | (100.0 | )% | |||||||||
Realized gain (loss) on investments and other | 726 | — | 726 | 100.0 | % | ||||||||||
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense) | (23,291 | ) | (25,915 | ) | 2,624 | (10.1 | )% | ||||||||
Equity in earnings (losses) of unconsolidated ventures | 16,631 | (18,557 | ) | 35,188 | (189.6 | )% | |||||||||
Income tax benefit (expense) | (10 | ) | (15 | ) | 5 | (33.3 | )% | ||||||||
Net income (loss) | $ | (6,670 | ) | $ | (44,487 | ) | $ | 37,817 | (85.0 | )% |
Three Months Ended September 30, | Increase (Decrease) | ||||||||||||||
2018 | 2017 | Amount | % | ||||||||||||
Same store AL/MC/CCRC properties (placed in service - 2016 and prior) | $ | 25,790 | $ | 24,883 | $ | 907 | 3.6 | % | |||||||
Properties placed in service - 2017 | 5,299 | (1) | 6,391 | (1,092 | ) | (17.1 | )% | ||||||||
Properties sold | 1,380 | 1,959 | (579 | ) | (29.6 | )% | |||||||||
Total resident fee income | $ | 32,469 | $ | 33,233 | $ | (764 | ) | (2.3 | )% |
(1) | Includes resident fee income generated from our Kansas City portfolio, which transitioned from a net leased portfolio to an operating portfolio during the year ended December 31, 2017. |
Three Months Ended September 30, | Increase (Decrease) | ||||||||||||||
2018 | 2017 | Amount | % | ||||||||||||
Same store IL properties (placed in service - 2016 and prior) | $ | 25,632 | $ | 28,106 | $ | (2,474 | ) | (8.8 | )% | ||||||
Same store net lease properties (placed in service - 2016 and prior) | 8,788 | 8,684 | 104 | 1.2 | % | ||||||||||
Properties placed in service - 2017 | 5,566 | 3,717 | 1,849 | 49.7 | % | ||||||||||
Total rental income | $ | 39,986 | $ | 40,507 | $ | (521 | ) | (1.3 | )% |
Three Months Ended September 30, | Increase (Decrease) | ||||||||||||||
Same store (placed in service - 2016 and prior) | 2018 | 2017 | Amount | % | |||||||||||
AL/MC/CCRC properties | $ | 18,205 | $ | 17,748 | $ | 457 | 2.6 | % | |||||||
IL properties | 18,441 | 17,153 | 1,288 | 7.5 | % | ||||||||||
Net lease properties | 255 | 22 | 233 | 1,059.1 | % | ||||||||||
Properties placed in service - 2017 | 9,121 | (1) | 6,350 | 2,771 | 43.6 | % | |||||||||
Properties sold | 1,333 | 1,708 | (375 | ) | (22.0 | )% | |||||||||
Total property operating expense | $ | 47,355 | $ | 42,981 | $ | 4,374 | 10.2 | % |
(1) | Includes operating expenses incurred by our Kansas City portfolio, which transitioned from a net leased portfolio to an operating portfolio during the year ended December 31, 2017. |
Three Months Ended September 30, | Increase (Decrease) | ||||||||||||||
Same store (placed in service - 2016 and prior) | 2018 | 2017 | Amount | % | |||||||||||
AL/MC/CCRC properties | $ | 4,046 | $ | 3,166 | $ | 880 | 27.8 | % | |||||||
IL properties | 7,646 | 7,613 | 33 | 0.4 | % | ||||||||||
Net lease properties | 3,271 | 3,085 | 186 | 6.0 | % | ||||||||||
Properties placed in service - 2017 | 2,584 | 1,725 | 859 | 49.8 | % | ||||||||||
Properties sold | 48 | 98 | (50 | ) | (51.0 | )% | |||||||||
Corporate | 82 | — | 82 | 100.0 | % | ||||||||||
Total interest expense | $ | 17,677 | $ | 15,687 | $ | 1,990 | 12.7 | % |
Three Months Ended September 30, | Increase (Decrease) | ||||||||||||||
Same store (placed in service - 2016 and prior) | 2018 | 2017 | Amount | % | |||||||||||
AL/MC/CCRC properties | $ | 3,221 | $ | 2,980 | $ | 241 | 8.1 | % | |||||||
IL properties | 15,582 | 15,524 | 58 | 0.4 | % | ||||||||||
Net lease properties | 3,468 | 3,336 | 132 | 4.0 | % | ||||||||||
Properties placed in service - 2017 | 3,358 | 2,468 | 890 | 36.1 | % | ||||||||||
Properties sold | — | 146 | (146 | ) | (100.0 | )% | |||||||||
Total depreciation and amortization expense | $ | 25,629 | $ | 24,454 | $ | 1,175 | 4.8 | % |
Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||||||||||||
Portfolio | Equity in Earnings (Losses) | Select Revenues and Expenses, net(1) | Equity in Earnings, Net of Select Revenues and Expenses | Increase (Decrease) | Cash Distributions | ||||||||||||||||||||||||||||||||||
Eclipse | $ | (69 | ) | $ | (776 | ) | $ | (462 | ) | $ | (1,229 | ) | $ | 393 | $ | 453 | $ | (60 | ) | (13.2 | )% | $ | 176 | $ | 581 | ||||||||||||||
Envoy | 339 | 247 | 64 | (1 | ) | 275 | 248 | 27 | 10.9 | % | 283 | 248 | |||||||||||||||||||||||||||
Griffin - American | (1,805 | ) | (1,261 | ) | (4,688 | ) | (4,553 | ) | 2,883 | 3,292 | (409 | ) | (12.4 | )% | 1,771 | 1,216 | |||||||||||||||||||||||
Espresso | 17,886 | (16,609 | ) | 15,982 | (19,964 | ) | 1,904 | 3,355 | (1,451 | ) | (43.2 | )% | — | — | |||||||||||||||||||||||||
Trilogy | 239 | (158 | ) | (3,659 | ) | (4,900 | ) | 3,898 | 4,742 | (844 | ) | (17.8 | )% | 1,450 | — | ||||||||||||||||||||||||
Subtotal | 16,590 | (18,557 | ) | 7,237 | (30,647 | ) | 9,353 | 12,090 | (2,737 | ) | (22.6 | )% | 3,680 | 2,045 | |||||||||||||||||||||||||
Operator Platform(2) | 41 | — | — | — | 41 | — | 41 | 100.0 | % | 15 | — | ||||||||||||||||||||||||||||
Total | $ | 16,631 | $ | (18,557 | ) | $ | 7,237 | $ | (30,647 | ) | $ | 9,394 | $ | 12,090 | $ | (2,696 | ) | (22.3 | )% | $ | 3,695 | $ | 2,045 |
(1) | Represents our proportionate share of revenues and expenses excluded from the calculation of FFO and MFFO. Refer to “—Non-GAAP Financial Measures” for additional discussion. |
(2) | Represents our investment in Solstice. |
Nine Months Ended September 30, | Increase (Decrease) | ||||||||||||||
2018 | 2017 | Amount | % | ||||||||||||
Property and other revenues | |||||||||||||||
Resident fee income | $ | 98,232 | $ | 93,060 | $ | 5,172 | 5.6 | % | |||||||
Rental income | 119,626 | 114,189 | 5,437 | 4.8 | % | ||||||||||
Other revenue | 2,692 | 2,191 | 501 | 22.9 | % | ||||||||||
Total property and other revenues | 220,550 | 209,440 | 11,110 | 5.3 | % | ||||||||||
Net interest income | |||||||||||||||
Interest income on debt investments | 5,763 | 5,755 | 8 | 0.1 | % | ||||||||||
Interest income on mortgage loans held in a securitized trust | 5,149 | 19,503 | (14,354 | ) | (73.6 | )% | |||||||||
Interest expense on mortgage obligations issued by a securitization trust | (3,824 | ) | (14,662 | ) | 10,838 | (73.9 | )% | ||||||||
Net interest income | 7,088 | 10,596 | (3,508 | ) | (33.1 | )% | |||||||||
Expenses | |||||||||||||||
Real estate properties - operating expenses | 141,510 | 118,526 | 22,984 | 19.4 | % | ||||||||||
Interest expense | 52,408 | 44,479 | 7,929 | 17.8 | % | ||||||||||
Other expenses related to securitization trust | 811 | 2,947 | (2,136 | ) | (72.5 | )% | |||||||||
Transaction costs | 806 | 6,778 | (5,972 | ) | (88.1 | )% | |||||||||
Asset management and other fees-related party | 17,845 | 32,716 | (14,871 | ) | (45.5 | )% | |||||||||
General and administrative expenses | 9,927 | 8,392 | 1,535 | 18.3 | % | ||||||||||
Depreciation and amortization | 81,943 | 69,223 | 12,720 | 18.4 | % | ||||||||||
Impairment loss | 5,239 | — | 5,239 | 100.0 | % | ||||||||||
Total expenses | 310,489 | 283,061 | 27,428 | 9.7 | % | ||||||||||
Other income (loss) | |||||||||||||||
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net | — | 1,108 | (1,108 | ) | (100.0 | )% | |||||||||
Realized gain (loss) on investments and other | 4,221 | 118 | 4,103 | 3,477.1 | % | ||||||||||
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense) | (78,630 | ) | (61,799 | ) | (16,831 | ) | 27.2 | % | |||||||
Equity in earnings (losses) of unconsolidated ventures | 3,907 | (31,234 | ) | 35,141 | (112.5 | )% | |||||||||
Income tax benefit (expense) | (40 | ) | (56 | ) | 16 | (28.6 | )% | ||||||||
Net income (loss) | $ | (74,763 | ) | $ | (93,089 | ) | $ | 18,326 | (19.7 | )% |
Nine Months Ended September 30, | Increase (Decrease) | ||||||||||||||
2018 | 2017 | Amount | % | ||||||||||||
Same store AL/MC/CCRC properties (placed in service - 2016 and prior) | $ | 76,728 | $ | 74,086 | $ | 2,642 | 3.6 | % | |||||||
Properties placed in service - 2017 | 15,980 | (1) | 13,041 | 2,939 | 22.5 | % | |||||||||
Properties sold | 5,524 | 5,933 | (409 | ) | (6.9 | )% | |||||||||
Total resident fee income | $ | 98,232 | $ | 93,060 | $ | 5,172 | 5.6 | % |
(1) | Includes resident fee income generated from our Kansas City portfolio, which transitioned from a net leased portfolio to an operating portfolio during the year ended December 31, 2017. |
Nine Months Ended September 30, | Increase (Decrease) | ||||||||||||||
2018 | 2017 | Amount | % | ||||||||||||
Same store IL properties (placed in service - 2016 and prior) | $ | 77,430 | $ | 84,431 | $ | (7,001 | ) | (8.3 | )% | ||||||
Same store net lease properties (placed in service - 2016 and prior) | 25,484 | 26,041 | (557 | ) | (2.1 | )% | |||||||||
Properties placed in service - 2017 | 16,712 | 3,717 | 12,995 | 349.6 | % | ||||||||||
Total rental income | $ | 119,626 | $ | 114,189 | $ | 5,437 | 4.8 | % |
Nine Months Ended September 30, | Increase (Decrease) | ||||||||||||||
Same store (placed in service - 2016 and prior) | 2018 | 2017 | Amount | % | |||||||||||
AL/MC/CCRC properties | $ | 54,085 | $ | 52,699 | $ | 1,386 | 2.6 | % | |||||||
IL properties | 54,980 | 50,763 | 4,217 | 8.3 | % | ||||||||||
Net lease properties | 1,089 | 14 | 1,075 | 7,678.6 | % | ||||||||||
Properties placed in service - 2017 | 26,340 | (1) | 9,880 | 16,460 | 166.6 | % | |||||||||
Properties sold | 5,016 | 5,170 | (154 | ) | (3.0 | )% | |||||||||
Total property operating expense | $ | 141,510 | $ | 118,526 | $ | 22,984 | 19.4 | % |
(1) | Includes operating expenses incurred by our Kansas City portfolio, which transitioned from a net leased portfolio to an operating portfolio during the year ended December 31, 2017. |
Nine Months Ended September 30, | Increase (Decrease) | ||||||||||||||
Same store (placed in service - 2016 and prior) | 2018 | 2017 | Amount | % | |||||||||||
AL/MC/CCRC properties | $ | 11,910 | $ | 9,314 | $ | 2,596 | 27.9 | % | |||||||
IL properties | 22,750 | 22,487 | 263 | 1.2 | % | ||||||||||
Net lease properties | 9,978 | 9,150 | 828 | 9.0 | % | ||||||||||
Properties placed in service - 2017 | 7,334 | 3,232 | 4,102 | 126.9 | % | ||||||||||
Properties sold | 243 | 296 | (53 | ) | (17.9 | )% | |||||||||
Corporate | 193 | — | 193 | 100.0 | % | ||||||||||
Total interest expense | $ | 52,408 | $ | 44,479 | $ | 7,929 | 17.8 | % |
Nine Months Ended September 30, | Increase (Decrease) | ||||||||||||||
Same store (placed in service - 2016 and prior) | 2018 | 2017 | Amount | % | |||||||||||
AL/MC/CCRC properties | $ | 9,505 | $ | 8,882 | $ | 623 | 7.0 | % | |||||||
IL properties | 47,097 | 46,515 | 582 | 1.3 | % | ||||||||||
Net lease properties | 10,187 | 9,777 | 410 | 4.2 | % | ||||||||||
Properties placed in service - 2017 | 15,049 | 3,610 | 11,439 | 316.9 | % | ||||||||||
Properties sold | 105 | 439 | (334 | ) | (76.1 | )% | |||||||||
Total depreciation and amortization expense | $ | 81,943 | $ | 69,223 | $ | 12,720 | 18.4 | % |
Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||||||||||||
Portfolio | Equity in Earnings (Losses) | Select Revenues and Expenses, net(1) | Equity in Earnings, Net of Select Revenues and Expenses | Increase (Decrease) | Cash Distributions | ||||||||||||||||||||||||||||||||||
Eclipse | $ | 11 | $ | (1,186 | ) | $ | (1,304 | ) | $ | (2,660 | ) | $ | 1,315 | $ | 1,474 | $ | (159 | ) | (10.8 | )% | $ | 621 | $ | 985 | |||||||||||||||
Envoy | (29 | ) | 419 | (300 | ) | (1 | ) | 271 | 420 | (149 | ) | (35.5 | )% | 283 | 427 | ||||||||||||||||||||||||
Griffin - American | (3,692 | ) | (5,795 | ) | (13,500 | ) | (15,228 | ) | 9,808 | 9,433 | 375 | 4.0 | % | 4,193 | 6,913 | ||||||||||||||||||||||||
Espresso | 6,331 | (19,258 | ) | 2,296 | (27,032 | ) | 4,035 | 7,774 | (3,739 | ) | (48.1 | )% | — | 3,307 | |||||||||||||||||||||||||
Trilogy | 1,137 | (5,414 | ) | (11,244 | ) | (17,637 | ) | 12,381 | 12,223 | 158 | 1.3 | % | 4,816 | — | |||||||||||||||||||||||||
Subtotal | 3,758 | (31,234 | ) | (24,052 | ) | (62,558 | ) | 27,810 | 31,324 | (3,514 | ) | (11.2 | )% | 9,913 | 11,632 | ||||||||||||||||||||||||
Operator Platform(2) | 149 | — | — | — | 149 | — | 149 | 100.0 | % | 107 | — | ||||||||||||||||||||||||||||
Total | $ | 3,907 | $ | (31,234 | ) | $ | (24,052 | ) | $ | (62,558 | ) | $ | 27,959 | $ | 31,324 | $ | (3,365 | ) | (10.7 | )% | $ | 10,020 | $ | 11,632 |
(1) | Represents our proportionate share of revenues and expenses excluded from the calculation of FFO and MFFO. Refer to “—Non-GAAP Financial Measures” for additional discussion. |
(2) | Represents our investment in Solstice. |
Nine Months Ended September 30, | ||||||||||||
Cash flow provided by (used in): | 2018 | 2017 | 2018 vs. 2017 Change | |||||||||
Operating activities | $ | 20,000 | $ | 15,442 | $ | 4,558 | ||||||
Investing activities | 34,691 | (306,023 | ) | 340,714 | ||||||||
Financing activities | (71,681 | ) | 94,704 | (166,385 | ) | |||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | $ | (16,990 | ) | $ | (195,877 | ) | $ | 178,887 |
Nine Months Ended September 30, | ||||||||||||
Capital Improvements | 2018 | 2017 | 2018 vs. 2017 Change | |||||||||
Development projects | $ | 3,320 | $ | 1,247 | $ | 2,073 | ||||||
Recurring | 16,683 | 12,216 | 4,467 | |||||||||
Total improvement of operating real estate investments | $ | 20,003 | $ | 13,463 | $ | 6,540 |
Type of Fee or Reimbursement | Due to Related Party as of December 31, 2017 | Nine Months Ended September 30, 2018 | Due to Related Party as of September 30, 2018 (Unaudited) | |||||||||||||||
Financial Statement Location | Incurred | Paid | ||||||||||||||||
Fees to Advisor Entities | ||||||||||||||||||
Asset management(1) | Asset management and other fees-related party | $ | — | $ | 17,853 | $ | (17,853 | ) | (2) | $ | — | |||||||
Acquisition(2) | Investments in unconsolidated ventures/Asset management and other fees-related party | 8 | (8 | ) | — | — | ||||||||||||
Reimbursements to Advisor Entities | ||||||||||||||||||
Operating costs(3) | General and administrative expenses | 1,038 | 8,621 | (7,168 | ) | 2,491 | ||||||||||||
Total | $ | 1,046 | $ | 26,466 | $ | (25,021 | ) | $ | 2,491 |
(1) | Includes $7.5 million paid in shares of our common stock. |
(2) | From inception through September 30, 2018, our Advisor waived $0.3 million of acquisition fees related to healthcare-related securities. We did not incur any disposition fees during the nine months ended September 30, 2018, nor were any such fees outstanding as of December 31, 2017. |
(3) | As of September 30, 2018, our Advisor does not have any unreimbursed operating costs which remain eligible to be allocated to us. |
Portfolio | Partner(s) | Acquisition Date | Ownership | |||
Eclipse | Colony Capital/Formation Capital, LLC | May-2014 | 5.6% | |||
Griffin-American | Colony Capital | Dec-2014 | 14.3% |
• | acquisition fees and expenses; |
• | non-cash amounts related to straight-line rent and the amortization of above or below market and in-place intangible lease assets and liabilities (which are adjusted in order to reflect such payments from an accrual basis of accounting under U.S. GAAP to a cash basis of accounting); |
• | amortization of a premium and accretion of a discount on debt investments; |
• | non-recurring impairment of real estate-related investments that meet the specified criteria identified in the rules and regulations of the SEC; |
• | realized gains (losses) from the early extinguishment of debt; |
• | realized gains (losses) on the extinguishment or sales of hedges, foreign exchange, securities and other derivative holdings except where the trading of such instruments is a fundamental attribute of our business; |
• | unrealized gains (losses) from fair value adjustments on real estate securities, including CMBS and other securities, interest rate swaps and other derivatives not deemed hedges and foreign exchange holdings; |
• | unrealized gains (losses) from the consolidation from, or deconsolidation to, equity accounting; |
• | adjustments related to contingent purchase price obligations; and |
• | adjustments for consolidated and unconsolidated partnerships and joint ventures calculated to reflect MFFO on the same basis as above. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Funds from operations: | |||||||||||||||
Net income (loss) attributable to NorthStar Healthcare Income, Inc. common stockholders | $ | (6,604 | ) | $ | (44,390 | ) | $ | (74,366 | ) | $ | (93,062 | ) | |||
Adjustments: | |||||||||||||||
Depreciation and amortization | 25,629 | 24,454 | 81,943 | 69,223 | |||||||||||
Impairment losses of depreciable real estate | — | — | 4,514 | — | |||||||||||
Depreciation and amortization related to unconsolidated ventures | 8,941 | 9,527 | 25,676 | 30,713 | |||||||||||
Depreciation and amortization related to non-controlling interests | (170 | ) | (147 | ) | (629 | ) | (334 | ) | |||||||
Impairment loss on real estate related to non-controlling interests | — | — | (62 | ) | — | ||||||||||
Realized (gain) loss from sales of property | (63 | ) | — | (63 | ) | — | |||||||||
Realized gain (loss) from sales of property related to non-controlling interests | 2 | — | 2 | — | |||||||||||
Realized (gain) loss from sales of property related to unconsolidated ventures | (9 | ) | (734 | ) | 2,713 | (1,281 | ) | ||||||||
Impairment losses of depreciable real estate held by unconsolidated ventures | 990 | 798 | 1,316 | 4,328 | |||||||||||
Funds from operations attributable to NorthStar Healthcare Income, Inc. common stockholders | $ | 28,716 | $ | (10,492 | ) | $ | 41,044 | $ | 9,587 | ||||||
Modified funds from operations: | |||||||||||||||
Funds from operations attributable to NorthStar Healthcare Income, Inc. common stockholders | $ | 28,716 | $ | (10,492 | ) | $ | 41,044 | $ | 9,587 | ||||||
Adjustments: | |||||||||||||||
Acquisition fees and transaction costs | — | 8,380 | 796 | 14,107 | |||||||||||
Straight-line rental (income) loss | (248 | ) | (324 | ) | 628 | (1,287 | ) | ||||||||
Amortization of premiums, discounts and fees on investments and borrowings | 1,184 | 1,088 | 3,588 | 3,114 | |||||||||||
Amortization of discounts on healthcare-related securities | — | 389 | 314 | 1,122 | |||||||||||
Adjustments related to unconsolidated ventures(1) | (17,159 | ) | 21,056 | (5,653 | ) | 28,798 | |||||||||
Adjustments related to non-controlling interests | 10 | (119 | ) | (29 | ) | (132 | ) | ||||||||
Realized (gain) loss on investments and other | (663 | ) | — | (4,158 | ) | (118 | ) | ||||||||
Unrealized (gain) loss on senior housing mortgage loans and debt held in securitization trust | — | (384 | ) | — | (1,108 | ) | |||||||||
Impairment of assets other than real estate | — | — | 725 | — | |||||||||||
Modified funds from operations attributable to NorthStar Healthcare Income, Inc. common stockholders | $ | 11,840 | $ | 19,594 | $ | 37,255 | $ | 54,083 |
(1) | Primarily represents our proportionate share of liability extinguishment gains, loan loss reserves, transaction costs and amortization of above/below market debt adjustments and deferred financing costs, incurred through our investments in unconsolidated ventures. |
Nine Months Ended September 30, 2018 | Year Ended December 31, 2017 | |||||||||||
Distributions(1) | ||||||||||||
Cash | $ | 24,086 | $ | 58,766 | ||||||||
DRP | 23,165 | 67,037 | ||||||||||
Total | $ | 47,251 | $ | 125,803 | ||||||||
Sources of Distributions(1) | ||||||||||||
FFO(2) | $ | 41,044 | 87 | % | $ | 16,831 | 13 | % | ||||
Offering proceeds - Other | 6,207 | 13 | % | 108,972 | 87 | % | ||||||
Total | $ | 47,251 | 100 | % | $ | 125,803 | 100 | % | ||||
Cash Flow Provided by (Used in) Operations | $ | 20,000 | $ | 7,858 |
(1) | Represents distributions declared for such period, even though such distributions are actually paid to stockholders the month following such period. |
(2) | From inception of our first investment on April 5, 2013 through September 30, 2018, we declared $412.4 million in distributions. Cumulative FFO for the period from April 5, 2013 through September 30, 2018 was $55.7 million. |
Nine Months Ended September 30, 2018 | |||||||||||||
Operator / Tenant | Properties Under Management | Units Under Management(1) | Property and Other Revenues | % of Total Property and Other Revenues | |||||||||
Watermark Retirement Communities | 29 | 5,225 | $ | 115,463 | 52.4 | % | |||||||
Solstice Senior Living | (2) | 32 | 4,000 | 79,350 | 36.0 | % | |||||||
Avamere Health Services | (3) | 5 | 453 | 12,541 | 5.7 | % | |||||||
Arcadia Management | 4 | 572 | 7,961 | 3.6 | % | ||||||||
Integral Senior Living | (2) | 3 | 162 | 3,852 | 1.7 | % | |||||||
Peregrine Senior Living | 2 | 114 | 1,114 | 0.5 | % | ||||||||
Senior Lifestyle Corporation | (4) | 2 | 115 | (195 | ) | (0.1 | )% | ||||||
Other | (5) | — | — | 464 | 0.2 | % | |||||||
Total | 77 | 10,641 | $ | 220,550 | 100.0 | % |
(1) | Represents rooms for ALF and ILF and beds for MCF and SNF, based on predominant type. |
(2) | Solstice Senior Living, LLC is a joint venture of which affiliates of Integral Senior Living own 80%. |
(3) | Effective February 2018, properties under the management of Bonaventure were transitioned to Avamere Health Services. |
(4) | As a result of the tenant failing to remit rental payments, we accelerated the amortization of capitalized lease inducements. |
(5) | Represents interest income earned on corporate-level cash accounts. |
• | Limit the amount of shares that may be repurchased pursuant to our Share Repurchase Program (including repurchases in the case of death or qualifying disability) as follows: (a) for repurchase requests made during the calendar quarter ending December 31, 2017, $8.0 million in aggregate repurchases and (b) for repurchase requests made in 2018 and thereafter, the lesser of (1) 5% of the weighted average number of shares of our common stock outstanding during the prior calendar year, less shares repurchased during the current calendar year, or (2) the net proceeds received during the calendar quarter in which such repurchase requests were made from the sale of shares pursuant to our DRP; |
• | The price paid for shares will be: (a) for shares repurchased in connection with a death or disability, the lesser of the price paid for the shares or the most recently published estimated net asset value per share, which is currently $8.50 and (b) for all other shares, 90.0% of the most recently published estimated value per share, which is currently $7.65; and |
• | In the event all repurchase requests in a given quarter could not be satisfied, we first repurchased shares submitted in connection with a stockholder’s qualifying death or disability, and thereafter repurchased shares pro rata, and we sought to honor any unredeemed shares in a future quarter (unless the stockholder withdrew its request). |
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plan or Program | Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan or Program | ||||||||
January 1 to January 31 | 20,839 | $ | 9.91 | 20,839 | (1) | |||||||
February 1 to February 28 | 1,027,861 | 7.78 | 1,027,861 | (1) | ||||||||
March 1 to March 31 | — | — | — | |||||||||
April 1 to April 30 | — | — | — | |||||||||
May 1 to May 31 | 1,002,908 | 7.84 | 1,002,908 | (1) | ||||||||
June 1 to June 30 | — | — | — | |||||||||
July 1 to July 31 | ||||||||||||
August 1 to August 31 | 976,894 | 7.91 | 976,894 | (1) | ||||||||
September 1 to September 30 | ||||||||||||
Total | 3,028,502 | $ | 7.86 | 3,028,502 |
(1) | Subject to funds being available, the limits under our Share Redemption Program were amended in December 2017, as described in further detail above. |
Exhibit Number | Description of Exhibit | |
3.1 | ||
3.2 | ||
3.3 | ||
4.1 | ||
31.1* | ||
31.2* | ||
32.1* | ||
32.2* | ||
101* | The following materials from the NorthStar Healthcare Income, Inc. Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2018, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of September 30, 2018 (unaudited) and December 31, 2017; (ii) Consolidated Statements of Operations (unaudited) for the three and nine months ended September 30, 2018 and 2017; (iii) Consolidated Statements of Comprehensive Income (Loss) (unaudited) for the three and nine months ended September 30, 2018 and 2017; (iv) Consolidated Statements of Equity (unaudited) for the nine months ended September 30, 2018 and 2017; (v) Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2018 and 2017; and (vi) Notes to Consolidated Financial Statements (unaudited) |
* | Filed herewith |
NorthStar Healthcare Income, Inc. | ||||
Date: | November 9, 2018 | By: | /s/ RONALD J. JEANNEAULT | |
Name: | Ronald J. Jeanneault | |||
Title: | Chief Executive Officer, President and Vice Chairman | |||
By: | /s/ FRANK V. SARACINO | |||
Name: | Frank V. Saracino | |||
Title: | Chief Financial Officer and Treasurer |
By: | /s/ RONALD J. JEANNEAULT | |||
Name: | Ronald J. Jeanneault | |||
Title: | Chief Executive Officer, President and Vice Chairman | |||
Date: | November 9, 2018 |
By: | /s/ FRANK V. SARACINO | |||
Name: | Frank V. Saracino | |||
Title: | Chief Financial Officer and Treasurer | |||
Date: | November 9, 2018 |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
By: | /s/ RONALD J. JEANNEAULT | |||||
Ronald J. Jeanneault | ||||||
Chief Executive Officer, President and Vice Chairman | ||||||
Date: | November 9, 2018 |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
By: | /s/ FRANK V. SARACINO | |||||
Frank V. Saracino | ||||||
Chief Financial Officer and Treasurer | ||||||
Date: | November 9, 2018 |
/)(...M &A+XCB@U2.UEL+U())EMTOF11"TC+D*,M
MO(/3<%VYXS4NJZW_ &;=VMI%I]W?W-TKLD5L8P0J;=Q)D=1CYE[]ZR-7M=3U
M76;'9I5Q;R6=W'+#>F[1[<1\;]\6[) )K:$;;U1&< YAZ V%'IQ['7$H
MQ)#>$VP-A3Z**+G0Q= ;D!@'1N,-QM2$!?& &32401 /"%0F<;$85 MV:A(/
MD]'E\ALAA4@O42P]RYK>C!$YB\&WE&D:$9/1I4LZ!JE-ZA+-MXUPB@M2BS7"
M HV(W*RP1M@%&F&Q1M@+;@_WD0_^.BNNO1B^G'I(P_6N;\:P>=XTCB_YZK&O
MYG%=% !_(UUEW:LFBB@ HHHH **** "BB
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M5V)IE ';W/CBU3(M;627W%Y@GQ!\-1=Y-1C_(?Y%9]+X0F^T_&;P[
MN2(;I2<>N"3_ "% 'UE1110 4444 %%%% !1110 4444 %%%% !1110 5Y;\
M5H"E\LXZ2697IW!;_$5ZE7"_%:S:7PVEVJY\@NK$#H&7_$#\Z / H)/-A5N_
M?ZU)6=93;)?+;[K=/K6C0 4444 %%%% !1110 4444 %%%% !1110 4444 %
M%%% !1110 4444 %%%% !1110 4444 %%%% !1110!'/,MO;O-(<*BDFIO@C
M;_VG\8K&XF&[R5FN&&.,[& _(L/RKF_$U_\ =LHS_M2?T']?RKU#]FC1M^IZ
MUK;H?W,26L3=B6.Y_P MB?G0!]"T444 %%%% !1110 4444 %%%% !1110 4
M444 %9?B;33K'AC4+!1N>:!A&/\ ;QE?U K4HH ^,7#(Q!!5E/(/4&M.TN//
MBY^^O!_QKIOB]X;.@^-YKB)-MIJ6;B(@8 ;^-?SY_P"!"N%BF:"4.GXCU% &
MY13(I5FC#H<@_I3Z "BBB@ HHHH **** "BBB@ HHHH **** "BBB@ HHHH
M**** "BBB@ HHHH **** "BBB@ JKJ%\EA9M,^"W1%_O&IY94@B:25@B*,DG
MM7%:IJ+ZC=%SD1KQ&OH* *LLKS3-)(=SL
9 Months Ended
Document and Entity Information
Entity Registrant Name
NorthStar Healthcare Income, Inc.
Entity Central Index Key
0001503707
Entity Current Reporting Status
Yes
Current Fiscal Year End Date
--12-31
Entity Filer Category
Non-accelerated Filer
Entity Common Stock, Shares Outstanding
188,017,022
Amendment Flag
false
Document Type
10-Q
Document Period End Date
Sep. 30, 2018
Document Fiscal Year Focus
2018
Document Fiscal Period Focus
Q3
Entity Emerging Growth Company
false
Entity Small Business
false
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)
$ 0.01
$ 0.01
Preferred stock, shares authorized (in shares)
50,000,000.0
50,000,000
Preferred stock, shares issued (in shares)
0
0
Preferred stock, shares outstanding (in shares)
0
0
Common stock, par value (in dollars per share)
$ 0.01
$ 0.01
Common stock, shares authorized (in shares)
400,000,000
400,000,000
Common stock, shares issued (in shares)
187,683,452
186,709,303
Common stock, shares outstanding (in shares)
187,683,452
186,709,303
$ in Thousands3 Months Ended
9 Months Ended
12 Months Ended
Property and other revenues
Total property and other revenues
$ 32,469
$ 33,233
$ 98,232
$ 93,060
Rental income
39,986
40,507
119,626
114,189
Other revenue
1,015
661
2,692
2,191
Revenues
73,470
74,401
220,550
209,440
Net interest income
Interest expense on mortgage obligations issued by a securitization trust
0
(4,919)
(3,824)
(14,662)
Net interest income
1,943
3,557
7,088
10,596
Expenses
Cost of goods and services sold
47,355
42,981
141,510
118,526
Interest expense
17,677
15,687
52,408
44,479
Other expenses related to securitization trust
0
981
811
2,947
Transaction costs
0
3,814
806
6,778
Asset management and other fees - related party
5,951
13,299
17,845
32,716
General and administrative expenses
2,818
3,041
9,927
8,392
Depreciation and amortization
25,629
24,454
81,943
69,223
Impairment loss
0
0
5,239
0
Total expenses
99,430
104,257
310,489
283,061
Other income (loss)
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
384
0
1,108
Realized gain (loss) on investments and other
726
0
4,221
118
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
(23,291)
(25,915)
(78,630)
(61,799)
Equity in earnings (losses) of unconsolidated ventures
16,631
(18,557)
3,907
(31,234)
Income tax benefit (expense)
(10)
(15)
(40)
(56)
Net income (loss)
(6,670)
(44,487)
(74,763)
(93,089)
Net (income) loss attributable to non-controlling interests
66
97
397
27
Net income (loss) attributable to NorthStar Healthcare Income, Inc. common stockholders
$ (6,604)
$ (44,390)
$ (74,366)
$ (93,062)
Net income (loss) per share of common stock, basic/diluted (in dollars per share)
$ (0.04)
$ (0.24)
$ (0.40)
$ (0.50)
Weighted average number of shares of common stock outstanding, basic/diluted (in shares)
187,432,091
186,825,812
187,278,444
186,293,783
Distributions declared per share of common stock (in dollars per share)
$ 0.09
$ 0.17
$ 0.25
$ 0.51
Debt Investments
Net interest income
Interest income
$ 1,943
$ 1,940
$ 5,763
$ 5,755
Mortgage Loans Held in Securitized Trust
Net interest income
Interest income
$ 0
$ 6,536
$ 5,149
$ 19,503
$ in Thousands3 Months Ended
9 Months Ended
Statement of Comprehensive Income [Abstract]
Net income (loss)
$ (6,670)
$ (44,487)
$ (74,763)
$ (93,089)
Other comprehensive income (loss)
Foreign currency translation adjustments related to investment in unconsolidated venture
(515)
605
(1,401)
2,185
Total other comprehensive income (loss)
(515)
605
(1,401)
2,185
Comprehensive income (loss)
(7,185)
(43,882)
(76,164)
(90,904)
Comprehensive (income) loss attributable to non-controlling interests
66
97
397
27
Comprehensive income (loss) attributable to NorthStar Healthcare Income, Inc. common stockholders
$ (7,119)
$ (43,785)
$ (75,767)
$ (90,877)
$ in Thousands
Beginning Balance (in shares) at Dec. 31, 2016
185,035,000
Beginning Balance at Dec. 31, 2016
$ 1,191,974
$ 1,186,625
$ 1,850
$ 1,666,479
$ (480,516)
$ (1,188)
$ 5,349
Increase (Decrease) in Stockholder's Equity
Issuance and amortization of equity-based compensation (in shares)
20,000
Issuance and amortization of equity-based compensation
146
146
146
Non-controlling interests - contributions
2,952
2,952
Non-controlling interests - distributions
(230)
(230)
Shares redeemed for cash (in shares)
(3,700,000)
Shares redeemed for cash
(34,118)
(34,118)
$ (37)
(34,081)
Distributions declared
(94,030)
(94,030)
(94,030)
Proceeds from distribution reinvestment plan (in shares)
5,559,000
Proceeds from distribution reinvestment plan
50,593
50,593
$ 56
50,537
Other comprehensive income (loss)
2,185
2,185
2,185
Net income (loss)
(93,089)
(93,062)
(93,062)
(27)
Ending Balance (in shares) at Sep. 30, 2017
186,914,000
Ending Balance at Sep. 30, 2017
1,026,383
1,018,339
$ 1,869
1,683,081
(667,608)
997
8,044
Beginning Balance (in shares) at Dec. 31, 2016
185,035,000
Beginning Balance at Dec. 31, 2016
1,191,974
1,186,625
$ 1,850
1,666,479
(480,516)
(1,188)
5,349
Increase (Decrease) in Stockholder's Equity
Net income (loss)
$ (93,089)
Ending Balance (in shares) at Dec. 31, 2017
186,709,303
186,709,000
Ending Balance at Dec. 31, 2017
$ 944,799
938,501
$ 1,867
1,681,040
(744,090)
(316)
6,298
Increase (Decrease) in Stockholder's Equity
Issuance and amortization of equity-based compensation
129
129
129
Share-based payment of advisor asset management fees (in shares)
882,000
Share-based payment of advisor asset management fees
7,500
7,500
$ 9
7,491
Non-controlling interests - contributions
395
395
Non-controlling interests - distributions
(531)
(531)
Shares redeemed for cash (in shares)
(3,028,000)
Shares redeemed for cash
(23,803)
(23,803)
$ (30)
(23,773)
Distributions declared
(47,251)
(47,251)
(47,251)
Proceeds from distribution reinvestment plan (in shares)
3,099,000
Proceeds from distribution reinvestment plan
26,342
26,342
$ 31
26,311
Other comprehensive income (loss)
(1,401)
(1,401)
(1,401)
Net income (loss)
$ (74,763)
(74,366)
(74,366)
(397)
Ending Balance (in shares) at Sep. 30, 2018
187,683,452
187,683,000
Ending Balance at Sep. 30, 2018
$ 831,416
$ 825,651
$ 1,877
$ 1,691,198
$ (865,707)
$ (1,717)
$ 5,765
$ in Thousands3 Months Ended
9 Months Ended
Cash flows from operating activities:
Net income (loss)
$ (6,670)
$ (44,487)
$ (74,763)
$ (93,089)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Equity in (earnings) losses of unconsolidated ventures
(16,631)
18,557
(3,907)
31,234
Depreciation and amortization
25,629
24,454
81,943
69,223
Impairment loss
0
0
5,239
0
Amortization of below market debt
2,190
1,988
Straight-line rental income, net and amortization of lease inducements
628
(1,287)
Amortization of premium/accretion of discount on investments
(75)
(68)
Amortization of deferred financing costs
1,439
1,220
Amortization of equity-based compensation
129
146
Realized (gain) loss on investments and other
(726)
0
(4,221)
(118)
Unrealized (gain) loss on senior housing mortgage loans and debt held in securitization trust, net
0
(1,108)
Allowance for uncollectible accounts
2,105
943
Distributions of cumulative earnings from unconsolidated ventures
0
427
Changes in assets and liabilities:
Receivables
2,257
(3,623)
Other assets
1,918
(1,993)
Due to related party
8,945
5,187
Escrow deposits payable
1,599
1,252
Accounts payable and accrued expenses
(5,691)
5,474
Other liabilities
265
(366)
Net cash provided by (used in) operating activities
20,000
15,442
Cash flows from investing activities:
Acquisition of operating real estate investments
0
(297,955)
Improvement of operating real estate investments
(20,003)
(13,463)
Sale of operating real estate investment
11,784
0
Sale of healthcare-related securities
35,771
0
Investment in unconsolidated ventures
(4,470)
(9,099)
Distributions in excess of cumulative earnings from unconsolidated ventures
10,020
11,206
Other assets
1,589
3,288
Net cash provided by (used in) investing activities
34,691
(306,023)
Cash flows from financing activities:
Borrowing from mortgage notes
0
173,690
Repayment of mortgage notes
(20,492)
(1,834)
Payment of deferred financing costs
(284)
(2,111)
Debt extinguishment costs
(97)
0
Shares redeemed for cash
(23,803)
(34,118)
Payments under capital leases
(453)
0
Distributions paid on common stock
(52,758)
(94,238)
Proceeds from distribution reinvestment plan
26,342
50,593
Contributions from non-controlling interests
395
2,952
Distributions to non-controlling interests
(531)
(230)
Net cash provided by (used in) financing activities
(71,681)
94,704
Net increase (decrease) in cash, cash equivalents and restricted cash
(16,990)
(195,877)
Cash, cash equivalents and restricted cash-beginning of period
80,488
251,892
Cash, cash equivalents and restricted cash-end of period
63,498
56,015
$ 63,498
$ 56,015
Supplemental disclosure of non-cash investing and financing activities:
Accrued distribution payable
5,197
10,371
Accrued capital expenditures
461
0
Reclassification of assets held for sale
0
0
Issuance of common stock as payment for asset management fees
7,500
0
Deconsolidation of securitization trust (VIE asset/liability)
512,772
0
Assumption of mortgage notes payable upon acquisitions of operating real estate
0
21,685
Acquisition of operating real estate under capital lease obligations
2,108
0
Change in carrying value of securitization trust (VIE asset/liability)
0
2,728
Debt financing provided by seller for investment acquisition
$ 0
$ 3,500
9 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Business and Organization
9 Months Ended
Accounting Policies [Abstract]
Summary of Significant Accounting Policies
9 Months Ended
Real Estate [Abstract]
Operating Real Estate
9 Months Ended
Equity Method Investments and Joint Ventures [Abstract]
Investments in Unconsolidated Ventures
9 Months Ended
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract]
Real Estate Debt Investments
9 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Healthcare-Related Securities
9 Months Ended
Debt Disclosure [Abstract]
Borrowings
Amount(2)
Value(2)
9 Months Ended
Related Party Transactions [Abstract]
Related Party Arrangements
9 Months Ended
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Equity-Based Compensation
9 Months Ended
Equity [Abstract]
Stockholders' Equity
9 Months Ended
Noncontrolling Interest [Abstract]
Non-controlling Interests
9 Months Ended
Fair Value Disclosures [Abstract]
Fair Value
9 Months Ended
Segment Reporting [Abstract]
Segment Reporting
9 Months Ended
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies
9 Months Ended
Subsequent Events [Abstract]
Subsequent Events
9 Months Ended
Accounting Policies [Abstract]
Basis of Quarterly Presentation
Principles of Consolidation
Variable Interest Entities
Voting Interest Entities
Investments in Unconsolidated Ventures
Non-controlling Interests
Estimates
Comprehensive Income (Loss)
Fair Value Option
Cash and Cash Equivalents
Restricted Cash
Operating Real Estate
Assets Held for Sale
Real Estate Debt Investments
Healthcare-Related Securities
Deferred Costs
Identified Intangibles
Acquisition Fees and Expenses
Revenue Recognition
Credit Losses and Impairment on Investments
Foreign Currency
Equity-Based Compensation
Income Taxes
Recent Accounting Pronouncements
9 Months Ended
Accounting Policies [Abstract]
Reconciliation of Cash, Cash Equivalents and Restricted Cash
Schedule of Operating Real Estate Estimated Useful Life
Summary of Deferred Costs and Intangible Assets
Schedule of Other Assets
Schedule of New Accounting Pronouncements and Changes in Accounting Principles
Schedule of Future Minimum Lease Payments for Capital Leases
Schedule of Deferred Costs and Intangible Assets, Future Amortization Expense
9 Months Ended
Real Estate [Abstract]
Schedule of Operating Real Estate
9 Months Ended
Equity Method Investments and Joint Ventures [Abstract]
Equity Method Investments
9 Months Ended
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract]
Schedule of the Company's Real Estate Debt Investments
9 Months Ended
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Consolidated Financial Information of Variable Interest Entities
9 Months Ended
Debt Disclosure [Abstract]
Summary of borrowings
Amount(2)
Value(2)
Schedule of principal on borrowings based on final maturity
9 Months Ended
Related Party Transactions [Abstract]
Schedule of the Fees and Reimbursements Incurred to the Advisor and Dealer Manager
Schedule of Joint Ventures
9 Months Ended
Equity [Abstract]
Schedule of Dividends Declared
9 Months Ended
Fair Value Disclosures [Abstract]
Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis
Change in Assets Measured at Fair Value on a Recurring Basis Using Level 3 Inputs
Change in Liabilities Measured at Fair Value on a Recurring Basis Using Level 3 Inputs
Schedule of the Principal Amount, Carrying Value and Fair Value of Certain Financial Assets and Liabilities
9 Months Ended
Segment Reporting [Abstract]
Schedule of Real Estate Properties
Summary of Segment Reporting
Summary of Assets by Segment
9 Months Ended
12 Months Ended
97 Months Ended
Class of Stock [Line Items]
Common stock, shares authorized (in shares) | shares
400,000,000
400,000,000
Common stock, par value (in dollars per share) | $ / shares
$ 0.01
$ 0.01
Preferred stock, shares authorized (in shares) | shares
50,000,000.0
50,000,000
Preferred stock, par value (in dollars per share) | $ / shares
$ 0.01
$ 0.01
Proceeds from initial offering | $
$ 1,100,000,000
Number of shares issued (in shares) | shares
108,600,000
Follow-on public offering | $
$ 700,000,000
Number of employees | employee
0
Subsequent event
Class of Stock [Line Items]
Net proceeds from issuance of common stock | $
$ 2,000,000,000
Dividend Reinvestment Plan
Class of Stock [Line Items]
Number of shares issued (in shares) | shares
2,000,000
4,200,000
Shares available (in shares) | shares
30,000,000
Dividend Reinvestment Plan | Subsequent event
Class of Stock [Line Items]
Net proceeds from issuance of common stock | $
$ 225,300,000
Follow-on Primary Offering
Class of Stock [Line Items]
Number of shares issued (in shares) | shares
64,900,000
Primary Beneficiary
Class of Stock [Line Items]
Limited partnership interest in operating partnership
99.99%
Advisor
Class of Stock [Line Items]
Non-controlling interest investment in operating partnership | $
$ 1,000
$ 1,000
Special Unit Holder
Class of Stock [Line Items]
Non-controlling interest investment in operating partnership | $
$ 1,000
$ 1,000
$ in Thousands3 Months Ended
9 Months Ended
12 Months Ended
Variable Interest Entities
VIE carrying value
$ 322,500
$ 322,500
Capital Lease Obligations
Capital leases for equipment
$ 2,900
$ 2,900
Lease amortization period (in years)
7 years
7 years
Identified Intangibles
Impairment of goodwill
$ 700
In-place lease and deferred cost amortization expense
$ 10,700
$ 9,900
$ 37,300
$ 30,000
Acquisition Fees and Expenses
Acquisition fee and expense cap
6.00%
6.00%
Credit Losses and Impairment on Investments
Impairment on consolidated operating real estate and assets held for sale, excluding impairment of goodwill
$ 4,500
Impairment loss on real estate held for sale
2,100
Impairment of real estate, tenant operations deterioration
$ 2,400
$ 5,000
Period past due for suspension of income recognition (in days)
90 days
Investments in Unconsolidated Ventures
Impairment recognized
$ 15,800
11,400
Gain on the extinguishment of liability
14,100
Income Taxes
Deferred tax asset
$ 10,300
10,300
Income tax benefit (expense)
10
$ 15
40
$ 56
$ 56
Variable Interest Entity, Primary Beneficiary | Operating Real Estate
Variable Interest Entities
Assets of consolidated VIEs
615,900
615,900
Variable Interest Entity, Primary Beneficiary | Mortgage Notes Payable
Variable Interest Entities
Liabilities of consolidated VIEs
$ 468,400
$ 468,400
Capital Lease
Capital Lease Obligations
Lease obligation interest rate
5.40%
5.40%
9 Months Ended
Building | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)
30 years
Building | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)
50 years
Land improvements | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)
9 years
Land improvements | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)
15 years
Furniture and fixtures | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)
5 years
Furniture and fixtures | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)
14 years
$ in Thousands
Accounting Policies [Abstract]
October 1 to December 31, 2018
$ 164
2019
588
2020
549
2021
510
2022
418
Thereafter
25
Total minimum lease payments
2,254
Less: Amount representing interest
(188)
Present value of minimum lease payments
$ 2,066
$ in Thousands
Deferred costs and intangible assets, net:
In-place lease value, net
$ 24,489
$ 61,593
Goodwill
21,387
22,112
Other intangible assets
380
380
Subtotal intangible assets
46,256
84,085
Deferred costs, net
747
635
Total
$ 47,003
$ 84,720
$ in Thousands
Accounting Policies [Abstract]
October 1 to December 31, 2018
$ 9,999
2019
8,428
2020
2,093
2021
1,871
2022
593
Thereafter
2,252
Total
$ 25,236
$ in Thousands
Other assets:
Healthcare facility regulatory reserve deposit
$ 6,000
$ 6,000
Remainder interest in condominium units
3,025
3,704
Prepaid expenses
2,767
3,352
Lease inducements, net
0
1,691
Utility deposits
356
503
Construction deposit
0
993
Other
1,038
1,231
Total
$ 13,186
$ 17,474
$ in Thousands
Accounting Policies [Abstract]
Cash and cash equivalents
$ 37,983
$ 50,046
Restricted cash
25,515
30,442
Total cash, cash equivalents and restricted cash
$ 63,498
$ 80,488
$ 56,015
$ 251,892
$ in Thousands9 Months Ended
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Net cash provided by (used in) operating activities
$ 20,000
$ 15,442
Net cash provided by (used in) investing activities
34,691
(306,023)
Net cash provided by (used in) financing activities
$ (71,681)
94,704
As Previously Reported
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Net cash provided by (used in) operating activities
11,708
Net cash provided by (used in) investing activities
(305,331)
Net cash provided by (used in) financing activities
$ 97,916
$ in Thousands
Real Estate [Abstract]
Land
$ 237,340
$ 239,580
Land improvements
22,190
21,908
Buildings and improvements
1,598,894
1,608,180
Tenant improvements
11,284
8,291
Construction in progress
13,754
5,376
Furniture, fixtures and equipment
88,552
83,017
Subtotal
1,972,014
1,966,352
Less: Accumulated depreciation
(157,165)
(113,924)
Operating real estate, net
$ 1,814,849
$ 1,852,428
$ in Thousands1 Months Ended
9 Months Ended
12 Months Ended
Business Combination, Separately Recognized Transactions [Line Items]
Impairment loss
$ 7,400
$ 5,000
Proceeds from sale of operating real estate property
$ 12,000
$ 11,784
$ 0
Repayment of mortgage note payable
9,000
Net proceeds to the joint venture
$ 2,700
Ownership interest (as a percentage)
97.00%
Watermark Retirement Communities
Business Combination, Separately Recognized Transactions [Line Items]
Ownership interest (as a percentage)
3.00%
$ in Thousands1 Months Ended
3 Months Ended
9 Months Ended
12 Months Ended
28 Months Ended
Schedule of Equity Method Investments [Line Items]
Number of properties sold | property
6
Number of properties held for sale | property
1
Payments to acquire interest in joint venture
$ 4,470
$ 9,099
Ownership percentage
97.00%
97.00%
Equity in Earnings (Losses)
$ 16,631
$ (18,557)
$ 3,907
(31,234)
$ (31,234)
Select Revenues and Expenses, net
7,237
(30,647)
(24,052)
(62,558)
Cash Distributions
3,695
2,045
10,020
11,632
Carry Value, total
$ 322,538
322,538
325,582
Impairment recognized
15,800
11,400
Gain on the extinguishment of liability
$ 14,100
Eclipse
Schedule of Equity Method Investments [Line Items]
Ownership interest (as a percentage)
5.60%
5.60%
Purchase Price
$ 1,048,000
Equity Investment
$ 23,400
$ 23,400
Properties as of September 30, 2018 | facility
76
76
Equity in Earnings (Losses)
$ (69)
(776)
$ 11
(1,186)
Select Revenues and Expenses, net
(462)
(1,229)
(1,304)
(2,660)
Cash Distributions
176
581
621
985
Carrying Value
12,533
12,533
13,143
Capitalized acquisition costs
$ 1,300
$ 1,300
Eclipse | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
44
44
Eclipse | MOB
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Eclipse | SNF
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
32
32
Eclipse | Hospitals
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Envoy
Schedule of Equity Method Investments [Line Items]
Ownership interest (as a percentage)
11.40%
11.40%
Purchase Price
$ 145,000
Equity Investment
$ 5,000
$ 5,000
Properties as of September 30, 2018 | facility
11
11
Equity in Earnings (Losses)
$ 339
247
$ (29)
419
Select Revenues and Expenses, net
64
(1)
(300)
(1)
Cash Distributions
283
248
283
427
Carrying Value
4,725
4,725
5,037
Capitalized acquisition costs
$ 400
$ 400
Envoy | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Envoy | MOB
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Envoy | SNF
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
11
11
Envoy | Hospitals
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Griffin - American
Schedule of Equity Method Investments [Line Items]
Ownership interest (as a percentage)
14.30%
14.30%
Purchase Price
$ 3,238,547
Equity Investment
$ 206,143
$ 206,143
Properties as of September 30, 2018 | facility
255
255
Equity in Earnings (Losses)
$ (1,805)
(1,261)
$ (3,692)
(5,795)
Select Revenues and Expenses, net
(4,688)
(4,553)
(13,500)
(15,228)
Cash Distributions
1,771
1,216
4,193
6,913
Carrying Value
124,933
124,933
134,219
Capitalized acquisition costs
$ 13,400
$ 13,400
Griffin - American | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
92
92
Griffin - American | MOB
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
108
108
Griffin - American | SNF
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
41
41
Griffin - American | Hospitals
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
14
14
Espresso
Schedule of Equity Method Investments [Line Items]
Ownership interest (as a percentage)
36.70%
36.70%
Purchase Price
$ 870,000
Equity Investment
$ 55,146
$ 55,146
Properties as of September 30, 2018 | facility
156
156
Equity in Earnings (Losses)
$ 17,886
(16,609)
$ 6,331
(19,258)
Select Revenues and Expenses, net
15,982
(19,964)
2,296
(27,032)
Cash Distributions
0
0
0
3,307
Carrying Value
11,639
11,639
5,308
Capitalized acquisition costs
$ 7,600
$ 7,600
Espresso | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
6
6
Espresso | MOB
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Espresso | SNF
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
150
150
Espresso | Hospitals
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Trilogy
Schedule of Equity Method Investments [Line Items]
Ownership interest (as a percentage)
29.00%
29.00%
29.00%
Purchase Price
$ 1,162,613
Equity Investment
$ 233,290
$ 233,290
Properties as of September 30, 2018 | facility
79
79
Payments to acquire interest in joint venture
$ 4,500
$ 201,700
8,300
$ 18,800
$ 233,300
Equity in Earnings (Losses)
$ 239
(158)
$ 1,137
(5,414)
Select Revenues and Expenses, net
(3,659)
(4,900)
(11,244)
(17,637)
Cash Distributions
1,450
0
4,816
0
Carrying Value
168,635
168,635
167,845
Capitalized acquisition costs
$ 9,800
$ 9,800
Trilogy | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
9
9
Trilogy | MOB
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Trilogy | SNF
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
70
70
Trilogy | Hospitals
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Eclipse, Envoy, Griffin-American, Espresso, Trilogy
Schedule of Equity Method Investments [Line Items]
Purchase Price
$ 6,464,160
$ 6,464,160
Equity Investment
$ 522,979
$ 522,979
Properties as of September 30, 2018 | facility
577
577
Equity in Earnings (Losses)
$ 16,590
(18,557)
$ 3,758
(31,234)
Select Revenues and Expenses, net
7,237
(30,647)
(24,052)
(62,558)
Cash Distributions
3,680
2,045
9,913
11,632
Carrying Value
$ 322,465
$ 322,465
325,552
Eclipse, Envoy, Griffin-American, Espresso, Trilogy | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
151
151
Eclipse, Envoy, Griffin-American, Espresso, Trilogy | MOB
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
108
108
Eclipse, Envoy, Griffin-American, Espresso, Trilogy | SNF
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
304
304
Eclipse, Envoy, Griffin-American, Espresso, Trilogy | Hospitals
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
14
14
Operator Platform
Schedule of Equity Method Investments [Line Items]
Ownership interest (as a percentage)
20.00%
20.00%
Purchase Price
$ 2
Equity Investment
$ 2
$ 2
Properties as of September 30, 2018 | facility
0
0
Equity in Earnings (Losses)
$ 41
0
$ 149
0
Select Revenues and Expenses, net
0
0
0
0
Cash Distributions
15
$ 0
107
$ 0
Carrying Value
$ 73
$ 73
$ 30
Operator Platform | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Operator Platform | MOB
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Operator Platform | SNF
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Operator Platform | Hospitals
Schedule of Equity Method Investments [Line Items]
Properties as of September 30, 2018 | facility
0
0
Eclipse, Envoy, Griffin-American, Espresso, Trilogy, Operator Platform
Schedule of Equity Method Investments [Line Items]
Purchase Price
$ 6,464,162
$ 6,464,162
Equity Investment
$ 522,981
$ 522,981
Total | facility
577
577
Eclipse, Envoy, Griffin-American, Espresso, Trilogy, Operator Platform | Senior Housing Facilities
Schedule of Equity Method Investments [Line Items]
Total | facility
151
151
Eclipse, Envoy, Griffin-American, Espresso, Trilogy, Operator Platform | MOB
Schedule of Equity Method Investments [Line Items]
Total | facility
108
108
Eclipse, Envoy, Griffin-American, Espresso, Trilogy, Operator Platform | SNF
Schedule of Equity Method Investments [Line Items]
Total | facility
304
304
Eclipse, Envoy, Griffin-American, Espresso, Trilogy, Operator Platform | Hospitals
Schedule of Equity Method Investments [Line Items]
Total | facility
14
14
Winterfell
Schedule of Equity Method Investments [Line Items]
Ownership interest (as a percentage)
20.00%
Winterfell | Solstice Senior Living
Schedule of Equity Method Investments [Line Items]
Ownership percentage
80.00%
$ in Thousands9 Months Ended
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Carrying Value
$ 74,725
$ 74,650
Mezzanine loans
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Carrying Value
$ 74,650
Mezzanine loans | Weighted Average
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Fixed Rate
10.00%
Unlevered Current Yield
10.30%
Espresso | Mezzanine Loans
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items]
Principal Amount
$ 75,000
Carrying Value
$ 74,725
9 Months Ended
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract]
Number of days past contractual debt service payments loan categorized as a weaker credit quality debt investment
90 days
Percent of interest income contributed by investment
100.00%
$ in Thousands1 Months Ended
3 Months Ended
9 Months Ended
12 Months Ended
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Realized gain (loss) on investments and other
$ 726
$ 0
$ 4,221
$ 118
$ 118
Percent of interest income contributed by investment
100.00%
Class B Certificates
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Realized gain (loss) on investments and other
$ 3,500
Freddie Mac 2016-KS06 Mortgage Trust
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Maximum exposure to loss
$ 32,300
Freddie Mac 2016-KS06 Mortgage Trust | Variable Interest Entity, Primary Beneficiary
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Securitization trust
$ 575,100
Count | loan
41
Mortgage loans weighted average maturity (in years)
9 years 9 months
Freddie Mac 2016-KS06 Mortgage Trust | Securitization Bonds | Variable Interest Entity, Primary Beneficiary
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Securitization trust
$ 517,600
Freddie Mac 2016-KS06 Mortgage Trust | Class B Certificates | Variable Interest Entity, Primary Beneficiary
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Par value
57,500
Discount
$ 27,000
Discount, percent
47.00%
Fixed interest rate
4.47%
Bond equivalent yield, percent
13.10%
$ in Thousands
Senior housing mortgage loans held in a securitization trust, at fair value
Assets
Assets
$ 545,048
Receivables
Assets
Assets
2,127
Total assets
Assets
Assets
547,175
Senior housing mortgage obligations issued by a securitization trust, at fair value
Liabilities
Liabilities
512,772
Accounts payable and accrued expenses
Liabilities
Liabilities
1,918
Total liabilities
Liabilities
Liabilities
$ 514,690
$ in Thousands3 Months Ended
9 Months Ended
12 Months Ended
Variable Interest Entity [Line Items]
Interest expense on mortgage obligations issued by a securitization trust
$ 0
$ (4,919)
$ (3,824)
$ (14,662)
Net interest income
1,943
3,557
7,088
10,596
Other expenses related to securitization trust
0
981
811
$ 2,947
2,947
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
384
0
1,108
1,108
Net income (loss) attributable to NorthStar Healthcare Income, Inc. common stockholders
(6,604)
(44,390)
(74,366)
$ (93,062)
Freddie Mac 2016-KS06 Mortgage Trust | Variable Interest Entity, Primary Beneficiary
Variable Interest Entity [Line Items]
Interest income on mortgage loans held in a securitized trust
0
6,536
5,149
19,503
Interest expense on mortgage obligations issued by a securitization trust
0
(4,919)
(3,824)
(14,662)
Net interest income
0
1,617
1,325
4,841
Other expenses related to securitization trust
0
981
(811)
2,947
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
384
0
1,108
Net income (loss) attributable to NorthStar Healthcare Income, Inc. common stockholders
$ 0
$ 1,020
$ 514
$ 3,002
$ in Thousands9 Months Ended
Debt Instrument [Line Items]
Carrying Value
$ 1,499,641
Watermark Fountains Portfolio
Debt Instrument [Line Items]
Number of healthcare real estate properties | property
14
Winterfell
Debt Instrument [Line Items]
Number of healthcare real estate properties | property
32
Mortgage notes payable, net
Debt Instrument [Line Items]
Principal Amount
$ 1,499,641
$ 1,520,133
Carrying Value
$ 1,470,646
1,487,480
Mortgage notes payable, net | Arbors Portfolio
Debt Instrument [Line Items]
Number of debt instruments | debt_instrument
4
Number of healthcare real estate properties | property
4
Mortgage notes payable, net | Winterfell
Debt Instrument [Line Items]
Number of debt instruments | debt_instrument
32
Mortgage notes payable, net | Bonaventure Portfolio
Debt Instrument [Line Items]
Number of debt instruments | debt_instrument
5
Number of healthcare real estate properties | property
5
Mortgage notes payable, net | Rochester
Debt Instrument [Line Items]
Number of debt instruments | debt_instrument
7
Number of healthcare real estate properties | property
7
Mortgage notes payable, net | Non-Recourse
Debt Instrument [Line Items]
Principal Amount
$ 1,483,786
1,504,278
Carrying Value
1,454,791
1,471,625
Mortgage notes payable, net | Non-Recourse | Peregrine Senior Living
Debt Instrument [Line Items]
Principal Amount
16,652
23,417
Carrying Value
$ 16,352
23,030
Number of properties securing debt | property
3
Mortgage notes payable, net | Non-Recourse | Peregrine Senior Living | LIBOR
Debt Instrument [Line Items]
Contractual Interest Rate
3.50%
Mortgage notes payable, net | Non-Recourse | Arbors Portfolio
Debt Instrument [Line Items]
Lease obligation interest rate
3.99%
Principal Amount
$ 91,173
92,407
Carrying Value
$ 89,869
90,913
Mortgage notes payable, net | Non-Recourse | Watermark Fountains Portfolio
Debt Instrument [Line Items]
Lease obligation interest rate
3.92%
Principal Amount
$ 401,000
410,000
Carrying Value
$ 398,134
406,207
Mortgage notes payable, net | Non-Recourse | Watermark Fountains Portfolio 2
Debt Instrument [Line Items]
Lease obligation interest rate
5.56%
Principal Amount
$ 75,401
75,401
Carrying Value
$ 74,776
74,776
Number of healthcare real estate properties | property
7
Mortgage notes payable, net | Non-Recourse | Winterfell
Debt Instrument [Line Items]
Lease obligation interest rate
4.17%
Principal Amount
$ 645,634
648,211
Carrying Value
$ 624,267
624,656
Mortgage notes payable, net | Non-Recourse | Bonaventure Portfolio
Debt Instrument [Line Items]
Lease obligation interest rate
4.66%
Principal Amount
$ 72,466
72,466
Carrying Value
71,829
71,771
Mortgage notes payable, net | Denver, CO Non-recourse | Denver, CO
Debt Instrument [Line Items]
Principal Amount
20,945
21,193
Carrying Value
$ 20,841
21,053
Mortgage notes payable, net | Denver, CO Non-recourse | Denver, CO | LIBOR
Debt Instrument [Line Items]
Contractual Interest Rate
2.92%
Mortgage notes payable, net | Frisco, TX Non-recourse | Frisco, TX
Debt Instrument [Line Items]
Principal Amount
$ 19,531
19,755
Carrying Value
$ 19,438
19,630
Mortgage notes payable, net | Frisco, TX Non-recourse | Frisco, TX | LIBOR
Debt Instrument [Line Items]
Contractual Interest Rate
3.04%
Mortgage notes payable, net | Milford, OH Non-recourse | Milford, OH
Debt Instrument [Line Items]
Principal Amount
$ 18,760
18,760
Carrying Value
$ 18,270
18,216
Mortgage notes payable, net | Milford, OH Non-recourse | Milford, OH | LIBOR
Debt Instrument [Line Items]
Contractual Interest Rate
2.68%
Mortgage notes payable, net | Rochester, NY Non-recourse, February 2025 | Rochester, NY
Debt Instrument [Line Items]
Lease obligation interest rate
4.25%
Principal Amount
$ 21,000
21,444
Carrying Value
20,879
21,312
Mortgage notes payable, net | Rochester, NY Non-recourse, August 2027 | Rochester, NY
Debt Instrument [Line Items]
Principal Amount
101,224
101,224
Carrying Value
$ 100,136
100,061
Mortgage notes payable, net | Rochester, NY Non-recourse, August 2027 | Rochester, NY | LIBOR
Debt Instrument [Line Items]
Contractual Interest Rate
2.34%
Mortgage notes payable, net | One-Month LIBOR
Debt Instrument [Line Items]
Principal Amount
$ 160,500
Mortgage notes payable, net | Three-Month LIBOR
Debt Instrument [Line Items]
Principal Amount
16,700
Other notes payable | Non-Recourse
Debt Instrument [Line Items]
Principal Amount
15,855
15,855
Carrying Value
$ 15,855
15,855
Other notes payable | Non-Recourse | Oak Cottage
Debt Instrument [Line Items]
Lease obligation interest rate
6.00%
Principal Amount
$ 3,500
3,500
Carrying Value
$ 3,500
3,500
Other notes payable | Non-Recourse | Rochester
Debt Instrument [Line Items]
Lease obligation interest rate
6.00%
Principal Amount
$ 12,355
12,355
Carrying Value
$ 12,355
$ 12,355
$ in Thousands
Debt Disclosure [Abstract]
October 1 to December 31, 2018
$ 5,598
2019
52,220
2020
24,345
2021
63,943
2022
464,987
Thereafter
888,548
Total
$ 1,499,641
1 Months Ended
9 Months Ended
12 Months Ended
Colony NorthStar, Inc.
Line of Credit Facility [Line Items]
Repayments of Lines of Credit
$ 25,000,000
Maximum borrowing capacity
$ 15,000,000.0
$ 35,000,000.0
Expiration term (in years)
1 year
Line of credit extension term (in months)
6 months
Proceeds drawn under line of credit
$ 25,000,000
Key Bank
Line of Credit Facility [Line Items]
Maximum borrowing capacity
$ 25,000,000.0
$ 25,000,000.0
Credit facility term (in years)
3 years
LIBOR | Colony NorthStar, Inc.
Line of Credit Facility [Line Items]
Interest rate
3.50%
Minimum | LIBOR | Key Bank
Line of Credit Facility [Line Items]
Interest rate
2.50%
Maximum | LIBOR | Key Bank
Line of Credit Facility [Line Items]
Interest rate
3.50%
1 Months Ended
Advisor
Related Party Transaction [Line Items]
Term of renewal (in years)
1 year
$ in Thousands1 Months Ended
9 Months Ended
12 Months Ended
Related Party Transaction [Line Items]
Due to related party
$ 1,046
$ 2,491
$ 1,046
Advisor | Asset Management Fees
Related Party Transaction [Line Items]
Monthly asset management fees as a percentage of investment amount
0.125%
0.08333%
Asset acquisition fee as a percentage of principal amount funded to originate debt, including acquisition expenses and any financing attributable to the investment
1.50%
1.00%
Due to related party
$ 2,500
Share repurchase program period (in years)
2 years
Advisor | Incentive Fee
Related Party Transaction [Line Items]
Incentive fee distributions, percent of net cash flows
15.00%
Incentive fee distributions, minimum non-compounded annual pre-tax return on invested capital
6.75%
Advisor | Asset Acquisition Fee
Related Party Transaction [Line Items]
Asset acquisition fee as a percentage of principal amount funded to originate debt, including acquisition expenses and any financing attributable to the investment
1.00%
Asset acquisition fee as a percentage of each real estate property acquired by the company, including acquisition expenses and any financing attributable to the investment
2.25%
Advisor | Asset Disposition Fee
Related Party Transaction [Line Items]
Due to related party
$ 0
$ 0
$ 0
Asset disposition fee as a percentage of contract sales price of property sold
2.00%
Asset disposition fee as a percentage of contract sales price of debt investment sold
1.00%
Asset disposition fee as a percentage of the debt investment prior to such transaction
1.00%
9 Months Ended
Related Party Transaction [Line Items]
Reimbursement of personnel costs related to executive officers and other personnel involved in activities for which the Advisor receives an acquisition fee or disposition fee | $
$ 0
Number of preceding fiscal quarters | quarter
4
Reimbursement expense period
12 months
Maximum
Related Party Transaction [Line Items]
Percentage of average invested assets reimbursable as operating costs
2.00%
Percentage of net income, without reduction for any additions to reserves for depreciation, loan losses or other similar non-cash reserves and excluding any gain from the sale of the company's assets
25.00%
$ in Thousands9 Months Ended
96 Months Ended
Related Party Transaction, Due to Related Parties [Roll Forward]
Due to related party, beginning balance
$ 1,046
Incurred
26,466
Paid
(25,021)
Due to related party, ending balance
2,491
$ 2,491
Issuance of common stock as payment for asset management fees
7,500
Advisor | Asset management
Related Party Transaction, Due to Related Parties [Roll Forward]
Due to related party, ending balance
2,500
2,500
Advisor | Asset management | Asset management and other fees-related party
Related Party Transaction, Due to Related Parties [Roll Forward]
Due to related party, beginning balance
0
Incurred
17,853
Paid
(17,853)
Due to related party, ending balance
0
0
Advisor | Acquisition | Investments in unconsolidated ventures/Asset management and other fees-related party
Related Party Transaction, Due to Related Parties [Roll Forward]
Due to related party, beginning balance
8
Incurred
(8)
Paid
0
Due to related party, ending balance
0
0
Advisor | Operating costs | General and administrative expenses
Related Party Transaction, Due to Related Parties [Roll Forward]
Due to related party, beginning balance
1,038
Incurred
8,621
Paid
(7,168)
Due to related party, ending balance
2,491
2,491
Advisor | Acquisition Fee Expense Waived | Investments in unconsolidated ventures/Asset management and other fees-related party
Related Party Transaction, Due to Related Parties [Roll Forward]
Incurred unreimbursed offering costs
300
Advisor | Asset Disposition Fee
Related Party Transaction, Due to Related Parties [Roll Forward]
Due to related party, beginning balance
0
Due to related party, ending balance
$ 0
$ 0
shares in Thousands, $ in Millions9 Months Ended
Related Party Transaction [Line Items]
Issuance of common stock as payment for asset management fees | $
$ 7.5
Common Stock
Related Party Transaction [Line Items]
Share-based payment of advisor asset management fees (in shares) | shares
882
Eclipse
Related Party Transaction [Line Items]
Ownership interest (as a percentage)
5.60%
Griffin - American
Related Party Transaction [Line Items]
Ownership interest (as a percentage)
14.30%
Colony NorthStar, Inc. | Eclipse
Related Party Transaction [Line Items]
Ownership interest (as a percentage)
5.60%
Colony NorthStar, Inc. | Griffin - American
Related Party Transaction [Line Items]
Ownership interest (as a percentage)
14.30%
$ in Thousands1 Months Ended
9 Months Ended
12 Months Ended
28 Months Ended
Related Party Transaction [Line Items]
Investment portfolio
$ 1,814,849
$ 1,852,428
Payments to acquire interest in joint venture
$ 4,470
$ 9,099
American Healthcare Investors, LLC | Sponsor
Related Party Transaction [Line Items]
Ownership interest (as a percentage)
43.00%
American Healthcare Investors, LLC | Mr. James F. Flaherty III
Related Party Transaction [Line Items]
Ownership interest (as a percentage)
12.30%
The Trilogy Portfolio
Related Party Transaction [Line Items]
Ownership interest (as a percentage)
29.00%
29.00%
Investment portfolio
$ 1,200,000
Payments to acquire interest in joint venture
$ 4,500
$ 201,700
$ 8,300
$ 18,800
$ 233,300
1 Months Ended
Related Party Transaction [Line Items]
VIE carrying value
$ 322,500,000
Mezzanine loans
Related Party Transaction [Line Items]
VIE carrying value
$ 75,000,000
Mezzanine loans | Espresso
Related Party Transaction [Line Items]
Fixed rate
10.00%
1 Months Ended
Related Party Transaction [Line Items]
Maximum borrowing capacity
$ 15,000,000.0
$ 35,000,000.0
LIBOR
Related Party Transaction [Line Items]
Interest rate
3.50%
$ in Thousands
3 Months Ended
9 Months Ended
Equity-based compensation
Equity-based compensation expense
$ 45
$ 47
$ 129
$ 146
Unrecognized equity-based compensation
$ 200
$ 200
$ 200
Restricted stock
Equity-based compensation
Restricted common shares grant vesting period
4 years
2 years
Unvested shares (in shares)
25,947
25,947
19,248
Independent Directors | Restricted stock
Equity-based compensation
Number of shares granted to independent directors (in shares)
96,625.1805882353
Aggregate value for restricted common shares granted to independent directors
$ 900
$ 900
shares in Millions, $ in Billions
96 Months Ended
Class of Stock [Line Items]
Number of shares issued (in shares)
108.6
Common Stock
Class of Stock [Line Items]
Number of shares issued (in shares)
173.4
Value of common stock issued
$ 1.7
$ / shares in Units, shares in Millions
9 Months Ended
12 Months Ended
96 Months Ended
Class of Stock [Line Items]
Share price (in dollars per share)
$ 9.10
Number of shares issued (in shares)
108.6
Common Stock
Class of Stock [Line Items]
Number of shares issued (in shares)
173.4
Value of common stock issued
$ 1,700,000,000
Dividend Reinvestment Plan
Class of Stock [Line Items]
Share price (in dollars per share)
$ 8.63
Share repurchase price (in dollars per share)
$ 8.50
Selling commissions or dealer manager fees paid
$ 0
Notice period served by board of directors to amend or terminate DRP (in days)
10 days
Dividend Reinvestment Plan | Common Stock
Class of Stock [Line Items]
Number of shares issued (in shares)
3.1
7.4
24.2
Value of common stock issued
$ 26,300,000
$ 67,200,000
$ 220,400,000
Initial Distribution Support Agreement | Dividend Reinvestment Plan
Class of Stock [Line Items]
Share price (in dollars per share)
$ 9.50
Follow-on Distribution Reinvestment Plan
Class of Stock [Line Items]
Share price (in dollars per share)
$ 10.20
Percentage of offering price
95.00%
Follow-on Distribution Reinvestment Plan | Dividend Reinvestment Plan
Class of Stock [Line Items]
Share price (in dollars per share)
$ 9.69
3 Months Ended
9 Months Ended
87 Months Ended
Equity [Abstract]
Daily amount of distribution accrued per share (in dollars per share)
$ 0.000924658
$ 0.00184932
Annualized distribution (in dollars per share)
$ 0.3375
$ 0.675
$ in Thousands1 Months Ended
9 Months Ended
Distributions
Cash
$ 2,758
$ 2,813
$ 2,803
$ 2,668
$ 2,731
$ 2,629
$ 2,697
$ 2,384
$ 2,603
$ 24,086
DRP
2,439
2,550
2,578
2,524
2,626
2,572
2,661
2,448
2,767
23,165
Total
$ 5,197
$ 5,363
$ 5,381
$ 5,192
$ 5,357
$ 5,201
$ 5,358
$ 4,832
$ 5,370
$ 47,251
$ 94,030
$ / shares in Units, shares in Millions, $ in Millions3 Months Ended
9 Months Ended
12 Months Ended
Equity [Abstract]
Holding period of shares required for repurchase (in years)
1 year
Value of shares repurchased during period
$ 8.0
$ 23.8
$ 52.8
Weighted average number of shares of common stock outstanding (as a percentage)
5.00%
Estimated value per share (in dollars per share)
$ 8.50
Ninety percent of estimated value per share (in dollars per share)
$ 7.65
Shares repurchased during period (in shares)
3.0
5.7
Average price per share (in dollars per share)
$ 7.86
$ 9.22
Share repurchase program, unfulfilled requests (in shares)
12.0
Share repurchase program, unfulfilled requests
$ 101.8
3 Months Ended
9 Months Ended
12 Months Ended
Noncontrolling Interest [Line Items]
Comprehensive (income) loss attributable to non-controlling interests
$ 66,000
$ 97,000
$ 397,000
$ 27,000
$ 27,000
Noncontrolling interests in Operating Company
Noncontrolling Interest [Line Items]
Comprehensive (income) loss attributable to non-controlling interests
$ 0
$ 0
$ 0
$ 0
$ in Thousands
Financial Assets
Senior housing mortgage loans held in a securitization trust, at fair value
$ 0
$ 545,048
Financial Liabilities
Senior housing mortgage obligations issued by a securitization trust, at fair value
$ 0
512,772
Recurring
Financial Assets
Senior housing mortgage loans held in a securitization trust, at fair value
545,048
Financial Liabilities
Senior housing mortgage obligations issued by a securitization trust, at fair value
512,772
Recurring | Level 1
Financial Assets
Senior housing mortgage loans held in a securitization trust, at fair value
0
Financial Liabilities
Senior housing mortgage obligations issued by a securitization trust, at fair value
0
Recurring | Level 2
Financial Assets
Senior housing mortgage loans held in a securitization trust, at fair value
0
Financial Liabilities
Senior housing mortgage obligations issued by a securitization trust, at fair value
512,772
Recurring | Level 3
Financial Assets
Senior housing mortgage loans held in a securitization trust, at fair value
545,048
Financial Liabilities
Senior housing mortgage obligations issued by a securitization trust, at fair value
$ 0
12 Months Ended
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Key unobservable inputs, weighted average yield, percentage
13.10%
Key unobservable inputs, weighted average life (in years)
9 years 7 months
Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets accounted for at fair value on a non-recurring basis
$ 0
Liabilities accounted for at fair value on a recurring basis
0
Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities accounted for at fair value on a recurring basis
$ 0
$ in Thousands9 Months Ended
12 Months Ended
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance
$ 545,048
$ 553,707
Purchases/contributions
0
0
Paydowns/distributions
(4,058)
Derecognition
(545,048)
0
Unrealized gain (loss)
0
(4,601)
Ending balance
$ 0
$ 545,048
$ in Thousands12 Months Ended
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance
$ 522,933
Transfers to Level 2
(522,933)
Paydowns/distributions
0
Sale of investment
0
Unrealized (gain) loss
0
Ending balance
$ 0
$ in Thousands
Financial Assets
Carrying Value
$ 74,725
$ 74,650
Fair Value
0
545,048
$ 553,707
Financial Liabilities
Carrying Value
1,470,646
1,487,480
Real estate debt investments, net
Financial Assets
Principal Amount
75,000
75,000
Carrying Value
74,725
74,650
Fair Value
75,000
75,000
Mortgage and other notes payable, net
Financial Liabilities
Principal Amount
1,499,641
1,520,133
Carrying Value
1,470,646
1,487,480
Fair Value
$ 1,445,360
$ 1,480,407
9 Months Ended
Segment Reporting [Abstract]
Number of segments
4
$ in Thousands9 Months Ended
Real Estate Properties [Line Items]
Properties Under Management | property
77
Units Under Management | unit
10,641
Property and Other Revenues | $
$ 220,550
Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
100.00%
Watermark Retirement Communities
Real Estate Properties [Line Items]
Properties Under Management | property
29
Units Under Management | unit
5,225
Property and Other Revenues | $
$ 115,463
Watermark Retirement Communities | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
52.40%
Solstice Senior Living
Real Estate Properties [Line Items]
Properties Under Management | property
32
Units Under Management | unit
4,000
Property and Other Revenues | $
$ 79,350
Solstice Senior Living | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
36.00%
Avamere Health Services
Real Estate Properties [Line Items]
Properties Under Management | property
5
Units Under Management | unit
453
Property and Other Revenues | $
$ 12,541
Avamere Health Services | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
5.70%
Arcadia Management
Real Estate Properties [Line Items]
Properties Under Management | property
4
Units Under Management | unit
572
Property and Other Revenues | $
$ 7,961
Arcadia Management | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
3.60%
Integral Senior Living
Real Estate Properties [Line Items]
Properties Under Management | property
3
Units Under Management | unit
162
Property and Other Revenues | $
$ 3,852
Integral Senior Living | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
1.70%
Peregrine Senior Living
Real Estate Properties [Line Items]
Properties Under Management | property
2
Units Under Management | unit
114
Property and Other Revenues | $
$ 1,114
Peregrine Senior Living | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
0.50%
Senior Lifestyle Corporation
Real Estate Properties [Line Items]
Properties Under Management | property
2
Units Under Management | unit
115
Property and Other Revenues | $
$ (195)
Senior Lifestyle Corporation | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
(0.10%)
Other
Real Estate Properties [Line Items]
Properties Under Management | property
0
Units Under Management | unit
0
Property and Other Revenues | $
$ 464
Other | Revenue
Real Estate Properties [Line Items]
Percentage of Total Property and Other Revenues
0.20%
$ in Thousands3 Months Ended
9 Months Ended
12 Months Ended
Segment Reporting Information [Line Items]
Rental and resident fee income
$ 72,455
$ 73,740
$ 217,858
$ 207,249
Net interest income on debt and securities
1,943
3,557
7,088
10,596
Other revenue
1,015
661
2,692
2,191
$ 2,191
Cost of goods and services sold
(47,355)
(42,981)
(141,510)
(118,526)
(118,526)
Interest expense
(17,677)
(15,687)
(52,408)
(44,479)
(44,479)
Other expenses related to securitization trust
0
(981)
(811)
(2,947)
(2,947)
Transaction costs
0
(3,814)
(806)
(6,778)
(6,778)
Asset management and other fees - related party
(5,951)
(13,299)
(17,845)
(32,716)
(32,716)
General and administrative expenses
(2,818)
(3,041)
(9,927)
(8,392)
(8,392)
Depreciation and amortization
(25,629)
(24,454)
(81,943)
(69,223)
(69,223)
Impairment loss
0
0
(5,239)
0
0
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
384
0
1,108
1,108
Realized gain (loss) on investments and other
726
0
4,221
118
118
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
(23,291)
(25,915)
(78,630)
(61,799)
(61,799)
Equity in earnings (losses) of unconsolidated ventures
16,631
(18,557)
3,907
(31,234)
(31,234)
Income tax benefit (expense)
(10)
(15)
(40)
(56)
(56)
Net income (loss)
(6,670)
(44,487)
(74,763)
(93,089)
$ (93,089)
Discount accretion income
75
68
Operating Segments
Segment Reporting Information [Line Items]
Rental and resident fee income
73,740
217,858
207,249
Net interest income on debt and securities
2,576
6,277
7,649
Other revenue
661
2,692
2,191
Cost of goods and services sold
(42,981)
(141,510)
(118,526)
Interest expense
(15,687)
(52,408)
(44,479)
Other expenses related to securitization trust
0
0
0
Transaction costs
(3,814)
(806)
(6,778)
Asset management and other fees - related party
(13,299)
(17,845)
(32,716)
General and administrative expenses
(3,041)
(9,927)
(8,392)
Depreciation and amortization
(24,454)
(81,943)
(69,223)
Impairment loss
(5,239)
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
384
0
1,108
Realized gain (loss) on investments and other
0
4,221
118
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
(25,915)
(78,630)
(61,799)
Equity in earnings (losses) of unconsolidated ventures
(18,557)
3,907
(31,234)
Income tax benefit (expense)
(15)
(40)
(56)
Net income (loss)
(44,487)
(74,763)
(93,089)
Operating Segments | Real Estate Equity
Segment Reporting Information [Line Items]
Rental and resident fee income
72,455
73,740
217,858
207,249
Net interest income on debt and securities
0
0
0
0
Other revenue
846
541
2,228
1,595
Cost of goods and services sold
(47,355)
(42,981)
(141,510)
(118,526)
Interest expense
(17,595)
(15,687)
(52,215)
(44,479)
Other expenses related to securitization trust
0
0
0
0
Transaction costs
0
(3,814)
(806)
(6,778)
Asset management and other fees - related party
0
0
0
0
General and administrative expenses
(232)
(262)
(734)
(682)
Depreciation and amortization
(25,629)
(24,454)
(81,943)
(69,223)
Impairment loss
0
(5,239)
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
0
0
0
Realized gain (loss) on investments and other
726
0
726
118
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
(16,784)
(12,917)
(61,635)
(30,726)
Equity in earnings (losses) of unconsolidated ventures
16,631
(18,557)
3,907
(31,234)
Income tax benefit (expense)
(10)
(15)
(40)
(56)
Net income (loss)
(163)
(31,489)
(57,768)
(62,016)
Operating Segments | Real Estate Debt
Segment Reporting Information [Line Items]
Rental and resident fee income
0
0
0
0
Net interest income on debt and securities
1,943
1,940
5,763
5,755
Other revenue
0
0
0
0
Cost of goods and services sold
0
0
0
0
Interest expense
0
0
0
0
Other expenses related to securitization trust
0
0
0
0
Transaction costs
0
0
0
0
Asset management and other fees - related party
0
0
0
0
General and administrative expenses
(10)
(12)
(29)
(39)
Depreciation and amortization
0
0
0
0
Impairment loss
0
0
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
0
0
0
Realized gain (loss) on investments and other
0
0
0
0
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
1,933
1,928
5,734
5,716
Equity in earnings (losses) of unconsolidated ventures
0
0
0
0
Income tax benefit (expense)
0
0
0
0
Net income (loss)
1,933
1,928
5,734
5,716
Operating Segments | Healthcare-Related Securities
Segment Reporting Information [Line Items]
Rental and resident fee income
0
0
0
Net interest income on debt and securities
1,025
828
3,016
Other revenue
0
0
0
Cost of goods and services sold
0
0
0
Interest expense
0
0
0
Other expenses related to securitization trust
0
0
0
Transaction costs
0
0
0
Asset management and other fees - related party
0
0
0
General and administrative expenses
0
(5)
0
Depreciation and amortization
0
0
0
Impairment loss
0
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
(5)
(314)
(14)
Realized gain (loss) on investments and other
0
3,495
0
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
1,020
4,004
3,002
Equity in earnings (losses) of unconsolidated ventures
0
0
0
Income tax benefit (expense)
0
0
0
Net income (loss)
1,020
4,004
3,002
Operating Segments | Corporate
Segment Reporting Information [Line Items]
Rental and resident fee income
0
0
0
0
Net interest income on debt and securities
0
(389)
(314)
(1,122)
Other revenue
169
120
464
596
Cost of goods and services sold
0
0
0
0
Interest expense
(82)
0
(193)
0
Other expenses related to securitization trust
0
0
0
0
Transaction costs
0
0
0
0
Asset management and other fees - related party
(5,951)
(13,299)
(17,845)
(32,716)
General and administrative expenses
(2,576)
(2,767)
(9,159)
(7,671)
Depreciation and amortization
0
0
0
0
Impairment loss
0
0
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
389
314
1,122
Realized gain (loss) on investments and other
0
0
0
0
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
(8,440)
(15,946)
(26,733)
(39,791)
Equity in earnings (losses) of unconsolidated ventures
0
0
0
0
Income tax benefit (expense)
0
0
0
0
Net income (loss)
$ (8,440)
(15,946)
(26,733)
(39,791)
Investing VIE
Segment Reporting Information [Line Items]
Rental and resident fee income
0
0
0
Net interest income on debt and securities
981
811
2,947
Other revenue
0
0
0
Cost of goods and services sold
0
0
0
Interest expense
0
0
0
Other expenses related to securitization trust
(981)
(811)
(2,947)
Transaction costs
0
0
0
Asset management and other fees - related party
0
0
0
General and administrative expenses
0
0
0
Depreciation and amortization
0
0
0
Impairment loss
0
Unrealized gain (loss) on senior housing mortgage loans and debt held in securitization trust, net
0
0
0
Realized gain (loss) on investments and other
0
0
0
Income (loss) before equity in earnings (losses) of unconsolidated ventures and income tax benefit (expense)
0
0
0
Equity in earnings (losses) of unconsolidated ventures
0
0
0
Income tax benefit (expense)
0
0
0
Net income (loss)
0
0
0
Discount accretion income
$ 400
$ 300
$ 1,100
$ in Thousands
Segment Reporting Information [Line Items]
Assets
[1]
$ 2,350,074
$ 2,998,753
Investments in unconsolidated ventures
322,538
325,582
Operating Segments
Segment Reporting Information [Line Items]
Assets
2,350,074
2,451,578
Operating Segments | Real Estate Equity
Segment Reporting Information [Line Items]
Assets
2,245,420
2,339,873
Investments in unconsolidated ventures
322,500
325,600
Operating Segments | Real Estate Debt
Segment Reporting Information [Line Items]
Assets
75,350
75,296
Operating Segments | Healthcare-Related Securities
Segment Reporting Information [Line Items]
Assets
0
32,484
Operating Segments | Corporate
Segment Reporting Information [Line Items]
Assets
29,304
3,925
Investing VIE
Segment Reporting Information [Line Items]
Assets
$ 0
$ 547,175
[1]
Represents the consolidated assets and liabilities of NorthStar Healthcare Income Operating Partnership, LP (the “Operating Partnership”). The Operating Partnership is a consolidated variable interest entity (“VIE”), of which the Company is the sole general partner and owns approximately 99.99%. As of September 30, 2018, the Operating Partnership includes $0.7 billion and $0.5 billion of assets and liabilities, respectively, of certain VIEs that are consolidated by the Operating Partnership. Refer to Note 2, “Summary of Significant Accounting Policies.”
$ in Millions
Commitments and Contingencies Disclosure [Abstract]
Contingent consideration payable
$ 1.8
$ / shares in Units, $ in Thousands, shares in Millions1 Months Ended
3 Months Ended
9 Months Ended
87 Months Ended
Subsequent Event [Line Items]
Proceeds from distribution reinvestment plan
$ 26,342
$ 50,593
Daily amount of distribution accrued per share (in dollars per share)
$ 0.000924658
$ 0.00184932
Subsequent event
Subsequent Event [Line Items]
Number of shares issued (in shares)
0.6
Proceeds from distribution reinvestment plan
$ 4,900
Daily amount of distribution accrued per share (in dollars per share)
$ 0.000924658
$ / shares in Units, shares in Millions, $ in Millions1 Months Ended
3 Months Ended
9 Months Ended
12 Months Ended
Subsequent Event [Line Items]
Shares repurchased during period (in shares)
(3.0)
(5.7)
Value of shares repurchased during period
$ (8.0)
$ (23.8)
$ (52.8)
Weighted average price of shares repurchased (in dollars per share)
$ 7.86
$ 9.22
Share repurchase program, unfulfilled requests (in shares)
12.0
Share repurchase program, unfulfilled requests
$ 101.8
Estimated value per share (in dollars per share)
$ 8.50
Subsequent event
Subsequent Event [Line Items]
Shares repurchased during period (in shares)
(0.2)
Value of shares repurchased during period
$ (2.1)
Weighted average price of shares repurchased (in dollars per share)
$ 8.50
1 Months Ended
3 Months Ended
87 Months Ended
Subsequent Event [Line Items]
Daily amount of distribution accrued per share (in dollars per share)
$ 0.000924658
$ 0.00184932
Subsequent event
Subsequent Event [Line Items]
Daily amount of distribution accrued per share (in dollars per share)
$ 0.000924658
$ in Millions1 Months Ended
Subsequent event
Subsequent Event [Line Items]
Gross proceeds from sale of interest | $
$ 48.0
Trilogy
Subsequent Event [Line Items]
Ownership interest (as a percentage)
29.00%
29.00%
Properties as of September 30, 2018 | facility
79
Trilogy | Subsequent event
Subsequent Event [Line Items]
Ownership interest sold (as a percentage)
20.00%
Investment ownership interest sold (as a percentage)
6.00%
Ownership interest (as a percentage)
23.00%
Envoy
Subsequent Event [Line Items]
Ownership interest (as a percentage)
11.40%
Properties as of September 30, 2018 | facility
11
Envoy | Subsequent event
Subsequent Event [Line Items]
Payments to acquire interest in joint venture | $
$ 116.0
BEL@.\'HQ9*:.B ()4%#J]8O
!V@3M0*A"AC-\3)YU3!N#R_,I^'VO'6L["P9U1
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M!!0 ( *J,:4WBY$?ULP$ -(# 9 >&PO=V]R:W-H965TA2"JL\#<#D5.,:7P"MK.^,"I,P'
MVL)W,#^&H[(KLJK43$"OF>R1@J; ]_'^D#F\!_QD,.G-'+E*3E*^N<5S7>#(
M&0(.E7$*U YG> #.G9"U\;YHXC6E(V[G%_5'7[NMY40U/$C^B]6F*_ =1C4T
M=.3F54Y/L-238;04_PW.P"W<.;$Y*LFU_Z)JU$:*1<5:$?1C'EGOQVG>N;W0
MPH1D(20KX
]YU7K/L[BZ$P7/U9NM*+-8JFFY\ZJBY/%&"V6I
MAWV?>5F