Assets and Associated Liabilities Held For Sale and Discontinued Operations

3 Months Ended

Mar. 31, 2019

Real Estate Liabilities Associated With Assets Held For Development And Sale [Abstract]

Assets and Associated Liabilities Held For Sale and Discontinued Operations

6. Assets and Associated Liabilities Held For Sale and Discontinued Operations

In March 2019, the Company entered into a Sale Agreement with HCP Medical Office Buildings, LLC related to the MOB Sale. As of March 31, 2019, as part of executing on strategic alternatives, the Company had committed to a plan to sell its MOB, Mid America Surgery, and classified the property as held for sale.  The Company believes the sale of Mid America Surgery would cause a strategic shift in the Company’s operations and, therefore, has classified the corresponding revenues and expenses for its MOB property as discontinued operations.

As of March 31, 2019 and December 31, 2018, the amounts classified as assets held for sale and the liabilities associated with those assets held for sale consisted of the following:

		March 31,		December 31,
		2019		2018
Real estate investment properties, net	$	10,579,020	$	10,603,833
Intangibles, net		1,962,515		3,485,818
Operating lease asset, net		1,501,024		―
Other assets		129,777		112,551
Assets held for sale, net	$	14,172,336	$	14,202,202

Mortgage loan, net	$	5,541,058	$	5,532,346
Accounts payable and accrued liabilities		343,725		391,735
Other liabilities		325,382		323,106
Liabilities associated with assets held for sale	$	6,210,165	$	6,247,187

The following table is a summary of the Company’s income from discontinued operations for the three months ended March 31, 2019 and 2018:

		Three Months Ended
		March 31,
		2019			2018
Revenues:
Rental income and related revenues	$	342,272		$	408,816
Operating expenses:
Property operating expenses		111,685			171,233
General and administrative		559			451
Property management fees		7,928			10,050
Depreciation and amortization		43,793			130,694
Total operating expenses		163,965			312,428
Operating income		178,307			96,388
Other expense:
Interest expense and loan cost amortization		(75,260	)		(63,848	)
Total other expense		(75,260	)		(63,848	)
Income before income taxes		103,047			32,540
Income tax expense		―			―
Income from discontinued operations	$	103,047		$	32,540

The Company completed the MOB Sale in May 2019; refer to Note 12. “Subsequent Events” for additional information.