Real Estate and Other Activities (Tables)

9 Months Ended

Sep. 30, 2022

Real Estate [Abstract]

Net Assets Acquired

We acquired or invested in the following net assets (in thousands):

	For the Nine Months Ended September 30,
	2022			2021
Land and land improvements	$	34,925		$	562,742
Buildings		312,645			1,670,741
Intangible lease assets — subject to amortization (weighted-average useful    life of 20.4 years for 2022 and 36.1 years for 2021)		19,839			197,735
Mortgage loans(1)(2)		100,000			1,090,400
Investments in unconsolidated real estate joint ventures		399,456			—
Investments in unconsolidated operating entities		131,105			845,646
Liabilities assumed		(25,727	)		(65,525	)
		972,243			4,301,739
Loans repaid(1)		—			(1,090,400	)
Total net assets acquired	$	972,243		$	3,211,339

(1)The 2021 column includes an £800 million mortgage loan advanced to the Priory Group ("Priory") in the first quarter of 2021 and converted to fee simple ownership of 35 properties in the second quarter of 2021 as described below.

(2)In the 2022 second quarter, we increased our mortgage loan to Prospect Medical Holdings, Inc. ("Prospect") that was originated in 2019 and that is secured by a first lien on a California hospital. The loan bears interest at a current market rate plus a component of additional interest upon repayment.

Summary of Status on Current Development Projects

See table below for a status summary of our current development projects (in thousands):

Property	Commitment		Costs Incurred as of September 30, 2022		Estimated Rent Commencement Date
Steward (Texas)	$	169,408	$	57,911	4Q 2025
Ernest (Stockton, California)		47,700		43,785	4Q 2022
IMED (Spain)		46,159		11,809	2Q 2023
IMED (Spain)		41,577		29,182	3Q 2023
Springstone (Texas)		34,600		1,144	1Q 2024
IMED (Spain)		33,635		7,535	3Q 2024
	$	373,079	$	151,366

Summary of Operating Results from Properties

The properties sold during 2022 do not meet the definition of discontinued operations. However, the following represents the operating results from these properties for the periods presented (in thousands):

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2022			2021			2022			2021
Revenues(1)	$	(27,026	)	$	44,963		$	17,831		$	135,392
Real estate depreciation and amortization(2)		(929	)		(7,245	)		(4,683	)		(26,292	)
Property-related expenses		156			(778	)		(1,752	)		(4,330	)
Other income(3)		68,867			47			536,823			181
Income from real estate dispositions, net	$	41,068		$	36,987		$	548,219		$	104,951

(1)Includes approximately $35 million and $42 million of straight-line rent and other write-offs associated with the non-Macquarie disposal transactions for the three and nine months ended September 30, 2022, respectively.

(2)Lower in 2022 as we stopped depreciating the properties making up the Macquarie Transaction once deemed held for sale in September 2021.

(3)Includes $68.8 million and $536.8 million of gains (net of $125 million write-off of straight-line rent receivables related to the Macquarie Transaction) for the three and nine months ended September 30, 2022, respectively.

Components of Total Investment in Financing Leases

The components of our total investment in financing leases consisted of the following (in thousands):

	As of September 30,    2022			As of December 31,    2021
Minimum lease payments receivable	$	888,308		$	1,183,855
Estimated unguaranteed residual values		203,818			203,818
Less: Unearned income and allowance for credit loss		(741,083	)		(918,584	)
Net investment in direct financing leases		351,043			469,089
Other financing leases (net of allowance for credit loss)		1,613,978			1,584,238
Total investment in financing leases	$	1,965,021		$	2,053,327

Summary of Investments in Unconsolidated Operating Entities.

The following is a summary of our investments in unconsolidated real estate joint ventures by operator (amounts in thousands):

Operator	As of September 30,    2022		As of December 31,    2021
Median Kliniken S.á.r.l ("MEDIAN")	$	449,226	$	517,648
Swiss Medical Network		422,731		476,193
Steward (Macquarie Transaction)		419,040		—
Policlinico di Monza		78,057		95,468
HM Hospitales		52,956		63,618
Total	$	1,422,010	$	1,152,927

The following is a summary of our investments in unconsolidated operating entities (amounts in thousands):

Operator	As of September 30,    2022		As of December 31,    2021
Steward (loan investment)	$	362,825	$	360,164
International joint venture		231,402		219,387
Springstone		200,827		187,450
Priory		144,266		42,315
Swiss Medical Network		147,189		159,208
Steward (equity investment)		139,000		139,000
Prospect		112,774		112,283
Aevis Victoria SA ("Aevis")		73,746		61,271
Aspris Children's Services ("Aspris")		16,032		8,356
Total	$	1,428,061	$	1,289,434

Summary of Activity in Credit Loss reserves

The following table summarizes the activity in our credit loss reserves (in thousands):

	For the Three Months Ended September 30,
	2022			2021
Balance at beginning of the period	$	55,250		$	7,783
Provision (recovery) for credit loss		(19,677	)		1,829
Expected credit loss reserve related to financial instruments      sold, repaid, or satisfied		(26,362	)		(85	)
Balance at end of the period	$	9,211		$	9,527

	For the Nine Months Ended September 30,
	2022			2021
Balance at beginning of the year	$	48,527		$	8,726
Provision (recovery) for credit loss		(12,920	)		890
Expected credit loss reserve related to financial instruments      sold, repaid, or satisfied		(26,396	)		(89	)
Balance at end of the period	$	9,211		$	9,527