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Real Estate Investments
 12 Months Ended
Dec. 31, 2019
Real Estate Investments, Net [Abstract]  
Real Estate Investments Real Estate Investments
The following table presents the allocation of assets acquired and liabilities assumed during the years ended December 31, 2019, 2018 and 2017. All acquisitions in 2019 and 2018 were considered asset acquisitions for accounting purposes. During 2017, prior to adoption of ASU No. 2017-01, Business Combinations (Topic 805) (See Note 3 — Summary of Significant Accounting Policies - Recent Accounting Pronouncements), all of the Company’s acquisitions, including the Merger, were accounted for as business combinations.
 
 
Year Ended December 31,
(Dollars in thousands)
 
2019
 
2018
 
2017
Real estate investments, at cost:
 
 
 
 
 
 
Land
 
$
76,610

 
$
61,745

 
$
313,423

Buildings, fixtures and improvements
 
288,549

 
140,151

 
1,176,909

Total tangible assets
 
365,159

 
201,896

 
1,490,332

Acquired intangible assets and liabilities: [1]
 
 
 
 
 
 
In-place leases
 
66,787

 
39,978

 
177,152

Above-market lease assets
 
1,973

 
1,055

 
22,934

Below-market ground lease asset
 
—

 
—

 
1,233

Above-market ground lease liability
 
—

 
—

 
—

Below-market lease liabilities
 
(4,980
)
 
(1,157
)
 
(106,513
)
Total intangible assets, net
 
63,780

 
39,876

 
94,806

Prior Credit Facility assumed in the Merger
 
—

 
—

 
(304,000
)
Mortgage notes payable assumed in the Merger
 
—

 
—

 
(127,651
)
Premiums on mortgage notes payable assumed in the Merger
 
—

 
—

 
(4,143
)
Other assets acquired and (liabilities assumed) in the Merger, net
 
—

 
—

 
16,427

Consideration paid for acquired real estate investments, net of liabilities assumed
 
$
428,939


$
241,772

 
$
1,165,771

Number of properties purchased
 
218

 
130

 
110


__________ 
[1] 
Weighted-average remaining amortization periods for in-place leases, above-market lease assets, below-market ground lease asset, and below-market lease liabilities acquired during the year ended December 31, 2019 were 14.7 years, 11.6 years, and 16.8 years, respectively, as of each property’s respective acquisition date.
The following table presents unaudited pro forma information as if the acquisitions, including the Merger, during the year ended December 31, 2017 had been consummated on January 1, 2016:
 
 
Year Ended December 31,
(In thousands, except per share data)
 
2017[1]
Pro forma revenues
 
$
293,768

Pro forma net loss
 
$
(38,113
)
Basic and diluted pro forma net loss per share
 
$
(0.36
)
__________ 
[1] 
For the year ended December 31, 2017, aggregate revenues and net income derived from the Company’s 2017 acquisitions (for the Company’s period of ownership) were $121.3 million and $11.6 million, respectively.

Total acquired intangible lease assets and liabilities consist of the following as of the dates presented:
 
 
December 31, 2019
 
December 31, 2018
(In thousands)
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
Intangible assets:
 
 
 
 
 
 
 
 
 
 
 
 
In-place lease assets
 
$
424,509

 
$
151,474

 
$
273,035

 
$
388,323

 
$
135,864

 
$
252,459

Above-market lease assets
 
23,666

 
8,152

 
15,514

 
24,392

 
7,477

 
16,915

Below-market ground lease assets [1]
 
—

 
—

 
—

 
1,233

 
60

 
1,173

Total acquired intangible lease assets
 
$
448,175

 
$
159,626

 
$
288,549

 
$
413,948

 
$
143,401

 
$
270,547

 
 
 
 
 
 
 
 
 
 
 
 
 
Intangible liabilities:
 
 

 
 

 
 
 
 
 
 
 
 
Above-market ground lease liability [1]
 
$
—

 
$
—

 
$
—

 
$
85

 
$
5

 
$
80

Below-market lease liabilities 
 
106,435

 
22,394

 
84,041

 
107,401

 
17,543

 
89,858

Total acquired intangible lease liabilities
 
$
106,435

 
$
22,394

 
$
84,041

 
$
107,486

 
$
17,548

 
$
89,938

__________ 
[1] 
Upon adoption of ASC 842 effective January 1, 2019, intangible assets related to ground leases were reclassified to be included as part of Operating lease right-of-use assets presented on the Company’s consolidated balance sheet. See Note 3 — Summary of Significant Accounting Polices - Recently Issued Accounting Pronouncements for additional information.
The following table presents amortization expenses and adjustments to revenue from tenants and property operating expenses for intangible assets and liabilities for the years ended December 31, 2019, 2018 and 2017:
 
 
Year Ended December 31,
(In thousands)
 
2019
 
2018
 
2017
In-place leases, included in depreciation and amortization
 
$
44,795

 
$
54,439

 
$
68,477

 
 
 
 
 
 
 
Above-market lease intangibles
 
$
(3,375
)
 
$
(4,441
)
 
$
(6,007
)
Below-market lease liabilities
 
10,796

 
19,989

 
11,212

Total included in revenue from tenants
 
$
7,421

 
$
15,548

 
$
5,205

 
 

 
 
 
 
Below-market ground lease asset [1]
 
$
32

 
$
32

 
$
(28
)
Above-market ground lease liability [1]
 
(2
)
 
(2
)
 
(2
)
Total included in property operating expenses
 
$
30

 
$
30

 
$
(30
)
__________ 
[1] 
Upon adoption of ASC 842 effective January 1, 2019, intangible balances related to ground leases were reclassified to be included as part of the Operating lease right-of-use assets presented on the Company’s consolidated balance sheet with no change to placement of the amortization expense of such balances. See Note 3 — Summary of Significant Accounting Polices - Recently Issued Accounting Pronouncements for additional information.
The following table provides the projected amortization expenses and adjustments to revenue from tenants for intangible assets and liabilities for the next five years:
(In thousands)
 
2020
 
2021
 
2022
 
2023
 
2024
In-place leases, to be included in depreciation and amortization
 
$
39,025

 
$
34,988

 
$
31,041

 
$
28,634

 
$
25,944

 
 
 
 
 
 
 
 
 
 
 
Above-market lease intangibles
 
$
2,604

 
$
2,289

 
$
1,914

 
$
1,666

 
$
1,529

Below-market lease liabilities
 
(6,891
)
 
(6,324
)
 
(5,962
)
 
(5,801
)
 
(5,587
)
Total to be included in revenue from tenants
 
$
(4,287
)
 
$
(4,035
)
 
$
(4,048
)
 
$
(4,135
)
 
$
(4,058
)

Real Estate Held for Sale
When assets are identified by management as held for sale, the Company ceases depreciation and amortization of the identified assets and estimates the sales price, net of costs to sell, of those assets. If the carrying amount of the assets classified as held for sale exceeds the estimated net sales price, the Company records an impairment charge equal to the amount by which the carrying amount of the assets exceeds the Company’s estimate of the net sales price of the assets. For additional information on impairment charges, see “Impairment Charges” section below.
As of December 31, 2019 and 2018, there were one and seven properties, respectively, classified as held for sale. During the year ended December 31, 2019, the Company sold five of the properties that were held for sale as of December 31, 2018 and had classified one additional property as held for sale. The disposal of these properties does not represent a strategic shift. Accordingly, the operating results of the properties sold remain classified within continuing operations for all periods presented.
The following table details the major classes of assets associated with the properties that have been reclassified as held for sale as of December 31, 2019 and 2018:
 
 
December 31,
(In thousands)
 
2019
 
2018
Real estate investments held for sale, at cost:
 
 
 
 
Land
 
$
563

 
$
6,113

Buildings, fixtures and improvements
 
750

 
39,343

Acquired intangible lease assets
 
—

 
12,517

Total real estate assets held for sale, at cost
 
1,313

 
57,973

Less accumulated depreciation and amortization
 
(137
)
 
(11,278
)
Total real estate investments held for sale, net
 
1,176

 
46,695

Impairment charges related to properties reclassified as held for sale [1]
 
—

 
(2,176
)
Assets held for sale
 
$
1,176

 
$
44,519

__________ 
[1] 
Impairment charges are recorded in the period in which an asset is reclassified to held for sale.
Real Estate Sales
During the year ended December 31, 2019, the Company sold 25 properties, including 22 properties leased to Truist Bank (formerly known as SunTrust Bank, “Truist Bank”), for an aggregate contract price of $131.7 million, exclusive of closing costs and related mortgage repayments. These sales resulted in aggregate gains of $23.7 million, which are reflected in gain on sale of real estate investments on the consolidated statement of operations and comprehensive income (loss) for the year ended December 31, 2019.
During the year ended December 31, 2018, the Company closed on the sale of 44 properties, including 31 properties leased to Truist Bank which had lease terms that expired between December 31, 2017 and March 31, 2018, for an aggregate contract price of $161.5 million, exclusive of closing costs. These sales resulted in aggregate gains of $31.8 million, which are reflected in gain on sale of real estate investments on the consolidated statement of operations and comprehensive loss for the year ended December 31, 2018.
During the year ended December 31, 2017, the Company closed on the sale of 25 properties, including 18 properties operated by Truist Bank for an aggregate contract price of $291.5 million, exclusive of closing costs. As discussed later in this footnote, the Company had previously taken impairment charges on certain of these properties. These sales resulted in aggregate gains of $15.1 million, which is reflected in gain on sale of real estate investments on the consolidated statement of operations and comprehensive loss for the year ended December 31, 2017.
Real Estate Held for Use
When circumstances indicate the carrying value of a property may not be recoverable, the Company reviews the property for impairment. For the Company, the most common triggering events are (i) concerns regarding the tenant (i.e., credit or expirations) in the Company’s single tenant properties or significant vacancy in the Company’s multi-tenant properties and (ii) changes to the Company’s expected holding period as a result of business decisions or non-recourse debt maturities. As of December 31, 2019 and December 31, 2018, the Company owned one and seven held for use single-tenant net lease properties leased to SunTrust,
which had lease terms that expired between December 31, 2017 and March 31, 2018. The one held for use property as of December 31, 2019 is vacant. For all of its held for use properties, the Company had reconsidered the projected cash flows due to various performance indicators and where appropriate, the Company evaluated the impact on its ability to recover the carrying value of such properties based on the expected cash flows over the intended holding period. See “Impairment Charges” below for discussion of specific charges taken.
For held for use assets, the Company primarily uses a market approach to estimate the future cash flows expected to be generated. This approach involves evaluating comparable sales of properties in the same geographic region as the held for use properties in order to determine an estimated sale price. The Company makes certain assumptions including, among others, the properties in the comparable sales used in the analysis share similar characteristics to the held for use properties and market and economic conditions at the time of any potential sales of these properties, such as discount rates; demand for space; competition for tenants; changes in market rental rates; and costs to operate the property, would be similar to those in the comparable sales analyzed. Where more than one possible scenario exists, the Company uses a probability weighted approach. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analysis may not be achieved, and actual losses or additional impairment may be realized in the future.
For some of the held for use properties, the Company had executed a non-binding letter of intent (“LOI”) or a definitive purchase and sale agreement (“PSA”) to sell the properties, however, these did not meet the criteria for held for sale treatment at December 31, 2019. In those instances, the Company used the sale price from the applicable LOI or PSA to estimate the future cash flows expected to be generated in the sale scenario. The Company made certain assumptions in this approach as well, mainly the sale of these properties would close at the terms specified in the LOI or PSA. There can be no guarantee the sales of these properties will close under these terms or at all.
Impairment Charges
The Company recorded total impairment charges of $0.8 million for the year ended December 31, 2019. These amounts are comprised of impairment charges of $0.1 million, which were recorded upon classification of properties to assets held for sale to adjust the properties to their fair value less estimated cost of disposal and impairment charges of $0.7 million, which was recorded on one held for use property leased to Truist Bank during the year ended December 31, 2019.
The Company recorded total impairment charges of $21.1 million for the year ended December 31, 2018. This amount is comprised of impairment charges of $11.0 million, which were recorded upon reclassification of properties to assets held for sale to adjust the properties to their fair value less estimated cost of disposal and impairment charges of $10.1 million, which were recorded on 12 (including impairments of $1.7 million on nine properties leased to Truist Bank) of the Company’s held for use properties. The majority of the impairment charges on the held for use properties related to two multi-tenant properties.
The Company recorded total impairment charges of $25.0 million for the year ended December 31, 2017. This amount is comprised of impairment charges of $4.5 million, which were recorded upon reclassification of properties to assets held for sale to adjust the properties to their fair value less estimated cost of disposal and impairment charges of $20.5 million were recorded on 38 (including impairments of $17.2 million on 36 properties leased to Truist Bank) the Company’s held for use propertie