Real Estate Acquisitions And Dispositions

9 Months Ended

Sep. 30, 2023

Business Combination and Asset Acquisition [Abstract]

Real Estate Acquisitions and Dispositions

REAL ESTATE ACQUISITIONS AND DISPOSITIONS

Acquisitions

During the third quarter of 2023, the Company acquired seven real estate properties. Upon acquisition, the properties were 99.8% leased in the aggregate with lease expirations through 2038. Amounts reflected in revenues and net income for these properties for the three months ended September 30, 2023 were approximately $0.8 million and $0.4 million, respectively, and transaction costs totaling approximately $0.7 million were capitalized relating to these property acquisitions.

During the second quarter of 2023, the Company acquired three real estate properties and one land parcel. Upon acquisition, the properties were 98.3% leased in the aggregate with lease expirations through 2033. Amounts reflected in revenues and net income for these properties for the nine months ended September 30, 2023 were approximately $0.6 million and $0.1 million, respectively, and transaction costs totaling approximately $0.4 million were capitalized relating to these property acquisitions.

During the first quarter of 2023, the Company acquired seven real estate properties. Upon acquisition, the properties were 100.0% leased in the aggregate with lease expirations through 2031. Amounts reflected in revenues and net income for these properties for the nine months ended September 30, 2023 were approximately $2.2 million and $0.5 million, respectively, and transaction costs totaling approximately $0.4 million were capitalized relating to these property acquisitions.

The following table summarizes our property acquisitions for the nine months ended September 30, 2023:

Location	Property Type (1)	Date Acquired	Purchase Price		Cash Consideration		Real Estate		Other (2)		Square Footage
			(000's)		(000's)		(000's)		(000's)
LaGrange, GA	MOB	01/18/23	$	8,007	$	8,087	$	8,118	$	(31)	55,310
West Point, GA	MOB	01/18/23	811		819		822		(3)		5,600
Canton, OH	MOB	01/30/23	3,669		3,706		4,287		(581)		27,920
Scranton, PA	MOB	02/23/23	1,957		2,165		2,317		(152)		22,743
Scranton, PA	MOB	02/23/23	2,207		2,366		2,340		26		15,768
LaGrange, GA	MOB	03/06/23	6,469		6,458		6,622		(164)		31,473
LaGrange, GA	MOB	03/06/23	249		294		300		(6)		2,972
Lakeland, FL	Land	04/03/23	838		845		846		(1)		—
Hermitage, PA	MOB	05/04/23	4,218		4,382		4,529		(147)		25,982
San Antonio, TX	MOB	05/22/23	2,772		2,783		3,031		(248)		12,376
Clinton, MD	MOB	06/21/23	7,850		7,807		7,867		(60)		37,344
Ft. Myers, FL	MOB	07/28/23	10,646		10,739		10,952		(213)		43,322
Ft. Myers, FL	MOB	07/28/23	582		588		497		91		3,200
Immokalee, FL	MOB	07/28/23	847		863		881		(18)		6,757
El Paso, TX	IRF	07/31/23	23,500		23,538		23,538		—		37,992
Beaver, PA	MOB	08/24/23	3,330		3,496		3,581		(85)		15,878
Westlake, OH	MOB	08/25/23	2,425		2,444		2,535		(91)		14,100
Newcastle, PA	MOB	09/15/23	10,375		10,613		11,239		(626)		56,003
			$	90,752	$	91,993	$	94,302	$	(2,309)	414,740
(1) MOB - Medical Office Building; IRF - Inpatient Rehabilitation Facility
(2) Includes other assets acquired, liabilities assumed, and above and below-market intangibles recognized at acquisition.

The following table summarizes the relative fair values of the assets acquired and liabilities assumed in the property acquisitions for the nine months ended September 30, 2023:

			Relative Fair Value		Estimated Useful Life
			(in thousands)		(in years)
Land and land improvements			$	17,836	8.7
Building and building improvements			65,765		30.8
Intangibles:
	At-market lease intangibles		10,701		4.5
	Above-market lease intangibles		976		5.1
	Below-market lease intangibles		(2,940)		5.4
		Total intangibles	8,737
Accounts payable, accrued liabilities and other liabilities assumed			(399)
Accounts receivable and other assets acquired			303
Prorated rent, interest and operating expense reimbursement amounts collected			(249)
	Total cash consideration		$	91,993

Asset Held for Sale

The Company incurred property damage due to vandalism at a property in Houston, Texas which was covered by our insurance policies. The Company estimated the fair value of the damaged property and recorded a casualty loss, for the difference between the estimated fair value less costs to sell and the insurance proceeds received. The Company determined that the estimated amount of the casualty loss was approximately $1.6 million and received insurance proceeds totaling $2.3 million in the second quarter of 2023, resulting in a net casualty gain of approximately $0.7 million which was included in Interest and other income on the Condensed Consolidated Statements of Income.

At June 30, 2023, the Company committed to a plan to dispose of the property in Houston, Texas and classified the property as an asset held for sale. The Company recorded an impairment on the asset held for sale of approximately $0.1 million in the third quarter of 2023. See also Note 10 – Other Assets, net and Note 11 – Other Liabilities, net.