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IMPAIRMENT OF REAL ESTATE INVESTMENTS, ASSETS HELD FOR SALE, NET AND ASSET SALES
 12 Months Ended
Dec. 31, 2024
Discontinued Operations and Disposal Groups [Abstract]  
IMPAIRMENT OF REAL ESTATE INVESTMENTS, ASSETS HELD FOR SALE, NET AND ASSET SALES IMPAIRMENT OF REAL ESTATE INVESTMENTS, ASSETS HELD FOR SALE, NET AND ASSET SALES
During the year ended December 31, 2024, the Company recognized aggregate impairment charges of $42.2 million, of which $18.8 million related to properties held for sale, $9.4 million related to properties held for investment, and $14.0 million related to properties that were sold. During the year ended December 31, 2023, the Company recognized aggregate impairment charges of $36.3 million, of which $26.8 million related to properties held for sale, $8.0 million related to properties held for investment, and $1.5 million related to properties that were sold. During the year ended December 31, 2022, the Company recognized aggregate impairment charges of $79.1 million, of which $14.4 million related to properties held for sale, $19.7 million related to properties held for investment, and $45.0 million related to properties that were sold. These charges are reported in impairment of real estate investments in the consolidated statements of operations.
Impairment of Real Estate Investments Held for Sale
As of December 31, 2024, there were 10 facilities classified as held for sale, all of which have been recorded at the lesser of their carrying value or fair value less estimated costs to sell.
The fair values of the assets held for sale were based on estimated sales prices, which are considered to be Level 3 measurements within the fair value hierarchy. Estimated sales prices were determined using a market approach (comparable sales model), which relies on certain assumptions by management, including: (i) comparable market transactions, (ii) estimated prices per unit, and (iii) binding agreements for sales and non-binding offers to purchase from unrelated third-parties. There are inherent uncertainties in making these assumptions. For the Company’s impairment calculations on assets held for sale during the twelve months ended December 31, 2024, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit ranging from $7,000 to $116,000, with a weighted average price per unit of $60,000. For the Company’s impairment calculations on assets held for sale during the twelve months ended December 31, 2023, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit ranging from $8,000 to $85,000, with a weighted average price per unit of $20,000. For the Company’s impairment calculations on assets held for sale during the twelve months ended December 31, 2022, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit ranging from $20,000 to $85,000, with a weighted average price per unit of $55,000.
Impairment of Real Estate Investments Held for Investment
During the quarter ended December 31, 2024, the Company recognized an impairment charge of $5.0 million related to one ALF with a carrying value of $5.0 million which was non-operational. In January 2025, the Company deeded the improvements back to the ground lessor for no consideration.
During the third quarter of 2024, the Company determined that two ALFs, with a carrying value of $5.0 million, that were classified as held for sale at June 30, 2024 no longer met the held for sale criteria. During the second quarter of 2024, the Company recognized $4.4 million of impairment charges in connection with the write down of the assets’ carrying values to their estimated fair value less costs to sell. The Company reclassified these ALFs out of assets held for sale at their fair value at the date of the decision not to sell of approximately $5.0 million, or a weighted average price per unit of $45,000. During the year ended December 31, 2024, the Company recognized approximately $4.4 million in impairment charges related to these two ALFs.
During the year ended December 31, 2023, the Company recognized an impairment charge of $8.0 million related to one SNF. The Company wrote down its carrying value of $8.7 million to its estimated fair value of $0.7 million, which is included in real estate investments, net on the Company’s consolidated balance sheets. The fair value of the asset was based on comparable market transactions and considered Level 3 measurements within the fair value hierarchy. For the Company’s impairment calculation, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit of $7,000.
During the year ended December 31, 2022, the Company recognized an impairment charge of $1.7 million related to one SNF. The Company wrote down its carrying value of $2.8 million to its estimated fair value of $1.1 million, which is included in real estate investments, net on the Company’s condensed consolidated balance sheets. The fair value of the asset was based on comparable market transactions and considered Level 3 measurements within the fair value hierarchy. For the Company’s impairment calculation, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit of $20,000.
During the third quarter of 2022, the Company determined that one ALF, with a carrying value of $4.9 million, that was classified as held for sale at June 30, 2022 no longer met the held for sale criteria. The Company reclassified this ALF out of assets held for sale at its fair value at the date of the decision not to sell of approximately $4.9 million, or a weighted average price per unit of $125,000. During the year ended December 31, 2022, the Company recognized approximately $1.4 million in impairment charges related to this one ALF.
During the fourth quarter of 2022, the Company determined that nine ALFs, with a carrying value of $50.8 million, that were classified as held for sale at September 30, 2022, no longer met the held for sale criteria. The Company reclassified the nine ALFs out of assets held for sale at their fair value at the date of the decision not to sell of approximately $47.8 million. During the year ended December 31, 2022, the Company recognized approximately $16.6 million in impairment charges related to these nine ALFs. The fair value of assets reclassified as real estate investments held for use was based on an income approach using current market conditions and considers matters such as the forecasted operating cash flows, lease coverage ratios, capitalization rates, and, where applicable, terms of recent lease agreements or the results of negotiations with prospective tenants, which are considered to be Level 3 measurements within the fair value hierarchy. There are inherent uncertainties in making these assumptions. For the Company’s impairment calculations, the Company’s fair value estimates primarily relied on an income approach. When utilizing an income approach, assumptions include, but are not limited to, terminal capitalization rates ranging from 7.5% to 8.75% and discount rates ranging from 8.5% to 9.75%.
Asset Sales and Held for Sale Reclassifications
The following table summarizes the Company’s dispositions for the years ended December 31, 2024, 2023 and 2022 (dollars in thousands):
Twelve Months Ended December 31,
20242023
2022(1)
Number of facilities 17513
Net sales proceeds(2)
$17,715 $18,313 $57,149 
Net carrying value19,923 16,095 60,918 
Net (loss) gain on sale$(2,208)$2,218 $(3,769)
(1)Net sales proceeds, net carrying value and net (loss) gain on sale also reflect a land parcel that was sold during the year ended December 31, 2022, which is not included in the number of facilities.
(2)Net sales proceeds includes $1.0 million of seller financing in connection with the sale of one ALF in January 2024. Net sales proceeds includes $2.0 million of seller financing in connection with the sale of one ALF in June 2023. Net sales proceeds includes $12.0 million of seller financing in connection with the sale of six SNFs and one multi-service campus in September 2022.
The following table summarizes the Company’s assets held for sale activity for the years ended December 31, 2024 and 2023 (dollars in thousands):
Net Carrying ValueNumber of Facilities
December 31, 2022$12,291 5 
Additions to assets held for sale47,114 14 
Assets sold(16,095)(5)
Impairment of real estate held for sale(28,299)— 
December 31, 202315,011 14
Additions to assets held for sale104,447 15 
Assets sold(19,923)(17)
Impairment of real estate held for sale(37,266)— 
Assets reclassified to held for investment(5,008)(2)
December 31, 2024$57,261 10