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Investment and Disposition Activity
 9 Months Ended
Sep. 30, 2019
Business Combinations [Abstract]  
Investment and Disposition Activity Investment and Disposition Activity

During the nine months ended September 30, 2019, the Company completed acquisitions of 10 operating healthcare properties located in 4 states for an aggregate purchase price of approximately $105.2 million. In addition, the Company purchased a newly-constructed addition to an existing building owned by the Company in Tennessee for $4.3 million. During the nine months ended September 30, 2019, the Company also funded $39.0 million of loan transactions, including two construction loans with an aggregate commitment amount of $44.3 million with funding to date of $14.1 million, four mezzanine loans for an aggregate $17.9 million, and one term loan for $7.0 million. The Company paid $3.2 million of additional purchase consideration on 2 properties under earn-out agreements and purchased 2 noncontrolling interests for $1.1 million. These transactions result in total investment activity of approximately $152.8 million for the nine months ended September 30, 2019.

Investment activity for the three months ended September 30, 2019 is summarized below:
Property
 
 
 
Location
 
Acquisition
Date
 
Purchase Price
(in thousands)
Rockwall II MOB
(1)
 
 
Rockwall, TX
 
July 26, 2019
 
$
24,006

Earnout - Hazelwood Medical Commons
(2)
 
 
Maplewood, MN
 
August 1, 2019
 
740

Shadeland Station Portfolio (2 MOBs)
 
 
 
Indianapolis, IN
 
August 2, 2019
 
23,296

NCI Buyout - Rockwall II MOB
(1)
 
 
Rockwall, TX
 
August 23, 2019
 
572

Shell Ridge Portfolio (5 MOBs)
(3)
 
 
Walnut Creek, CA
 
September 27, 2019
 
34,625

Loan Investments
 
 
 
Various
 
Various
 
11,945

 
 
 
 
 
 
 
 
$
95,184

(1)
On July 26, 2019 the Company completed the acquisition of a 97.5% interest in Rockwall II MOB. The Company acquired the remaining interest on August 23, 2019.
(2)
The Company completed the settlement of an acquisition related earn-out payment upon the execution of a lease. This payment was funded with the issuance of 3,409 Series A Preferred Units and is considered to be additional purchase price.
(3)
The Operating Partnership partially funded the acquisition by issuing an aggregate of 910,032 OP Units valued at approximately $16.1 million on the date of issuance.

The following table summarizes the acquisition date fair values of the assets acquired and the liabilities assumed, which the Company determined using Level 2 and Level 3 inputs (in thousands):
 
1st Quarter
 
2nd Quarter
 
3rd Quarter
 
Total
Land
$
—

 
$
5,491

 
$
10,466

 
$
15,957

Building and improvements
7,587

 
16,466

 
64,769

 
88,822

In-place lease intangibles
434

 
4,651

 
7,827

 
12,912

Above market in-place lease intangibles
—

 
—

 
136

 
136

Below market in-place lease intangibles
—

 
(96
)
 
—

 
(96
)
Right-of-use asset
—

 
—

 
630

 
630

Mortgage escrow
(3,718
)
 
—

 
—

 
(3,718
)
Issuance of OP Units
—

 
(6,488
)
 
(16,110
)
 
(22,598
)
Issuance of Series A Preferred Units
—

 
(1,862
)
 
(740
)
 
(2,602
)
Net assets acquired
$
4,303


$
18,162

 
$
66,978


$
89,443



Dispositions

During the nine months ended September 30, 2019, the Company sold 3 medical office facilities for approximately $15.3 million and recognized a net gain on the sale of approximately $3.4 million.

The following table summarizes revenues and net income related to the disposed properties for the periods presented (in thousands):
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2019
 
2018
 
2019
 
2018
Revenues
$
60

 
$
328

 
$
540

 
$
977

 
 
 
 
 
 
 
 
Income before net gain on sale of investment properties
$
9

 
$
70

 
$
169

 
$
209

Gain on sale of investment properties
409

 
—

 
3,442

 
—

Net income
$
418

 
$
70

 
$
3,611

 
$
209