UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 | ||||||
FORM 10-Q | ||||||
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||
For the quarterly period ended | June 30, 2018 | |||||
OR | ||||||
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||
For the transition period from to | ||||||
Commission File Number 001-38004 | ||||||
Invitation Homes Inc. (Exact name of registrant as specified in governing instruments) | ||||||
Maryland (State or other jurisdiction of incorporation or organization) | 90-0939055 (I.R.S. Employer Identification No.) | |||||
1717 Main Street, Suite 2000 Dallas, Texas 75201 (Address of principal executive offices)(Zip Code) | ||||||
(972) 421-3600 (Registrant’s telephone number, including area code) | ||||||
N/A (Former name, former address and former fiscal year, if changed since last report) | ||||||
Large accelerated filer | o | Accelerated filer | o | ||
Non-accelerated filer | x | (Do not check if a smaller reporting company) | Smaller reporting company | o | |
Emerging growth company | x |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x | |||||
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x |
Page | |||
PART I | |||
Item | 1. | Financial Statements | |
Item | 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
Item | 3. | Quantitative and Qualitative Disclosures About Market Risk | |
Item | 4. | Controls and Procedures | |
PART II | |||
Item | 1. | Legal Proceedings | |
Item | 1A. | Risk Factors | |
Item | 2. | Unregistered Sales of Equity Securities and Use of Proceeds | |
Item | 3. | Defaults Upon Senior Securities | |
Item | 4. | Mine Safety Disclosures | |
Item | 5. | Other Information | |
Item | 6. | Exhibits | |
Signatures | |||
• | “average monthly rent” represents average monthly rental income per home for occupied properties in an identified population of homes over the measurement period and reflects the impact of non-service rent concessions and contractual rent increases amortized over the life of the related lease; |
• | “average occupancy” for an identified population of homes represents (i) the total number of days that the homes in such population were occupied during the measurement period, divided by (ii) the total number of days that the homes in such population were owned during the measurement period; |
• | “days to re-resident” for an individual home represents the number of days between (i) the date the prior resident moves out of a home, and (ii) the date the next resident is granted access to the same home, which is deemed to be the earlier of the next resident’s contractual lease start date and the next resident’s move-in date; |
• | “Carolinas” includes Charlotte, NC, Greensboro, NC, Raleigh, NC and Fort Mill, SC. |
• | “in-fill” refers to markets, MSAs, submarkets, neighborhoods or other geographic areas that are typified by significant population densities and low availability of land suitable for development into competitive properties, resulting in limited opportunities for new construction; |
• | “Metropolitan Statistical Area” or “MSA” is defined by the United States Office of Management and Budget as a region associated with at least one urbanized area that has a population of at least 50,000 and comprises the central county or counties containing the core, plus adjacent outlying counties having a high degree of social and economic integration with the central county or counties as measured through commuting; |
• | “net effective rental rate growth” for any home represents the percentage difference between the monthly rent from an expiring lease and the monthly rent from the next lease and, in each case, reflects the impact of non-service rent concessions and contractual rent increases amortized over the life of the related lease. Leases are either renewal leases, where our current resident chooses to stay for a subsequent lease term, or a new lease, where our previous resident moves out and a new resident signs a lease to occupy the same home; |
• | “Northern California” includes Chico, CA, Modesto, CA, Napa, CA, Sacramento-Arden-Arcade-Roseville, CA, San Francisco-Oakland-Hayward, CA, Stockton-Lodi, CA, Vallejo-Fairfield, CA and Yuba City, CA; |
• | “PSF” means per square foot; |
• | “Same Store” or “Same Store portfolio” includes, for a given reporting period, homes that have been stabilized for at least 15 months prior to January 1st of the year in which the Same Store portfolio was established, excluding homes that have been sold, homes that have been identified for sale to an owner occupant and have become vacant, and homes that have been deemed inoperable or significantly impaired by casualty loss events or force majeure. Homes are considered stabilized if they have (i) completed an initial renovation and (ii) entered into at least one post-initial renovation lease. An acquired portfolio that is both leased and deemed to be of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio may be considered stabilized at the time of acquisition. Additionally, homes acquired via the Mergers have been deemed to qualify for the Same Store portfolio beginning in 2018 if they were stabilized, according to the Invitation Homes criteria for stabilization, within the Legacy SWH portfolio prior to the Mergers. We believe presenting information about the portion of our portfolio that has been fully operational for the entirety of a given reporting period and its prior year comparison period provides investors with meaningful information about the performance of our comparable homes across periods and about trends in our organic business. In order to provide meaningful comparative information across periods that, in some cases, pre-date the Mergers, all information regarding the performance of the Same Store portfolio for periods prior to December 31, 2017 is presented as though the Mergers were consummated on January 1, 2017; |
• | “Southeast United States” includes our Atlanta, Carolinas and Nashville markets; |
• | “South Florida” includes Miami-Fort Lauderdale-West Palm Beach, FL and Port St. Lucie, FL; |
• | “Southern California” includes Bakersfield, CA, Los Angeles-Long Beach-Anaheim, CA, Oxnard-Thousand Oaks-Ventura, CA, Riverside-San Bernardino-Ontario, CA and San Diego-Carlsbad, CA; |
• | “total homes” or “total portfolio” refers to the total number of homes we own, whether or not stabilized, and excludes any properties previously acquired in purchases that have been subsequently rescinded or vacated. Unless the context otherwise requires, all measures in this Quarterly Report on Form 10-Q are presented on a total portfolio basis; |
• | “turnover rate” represents the number of instances that homes in an identified population become unoccupied in a given period, divided by the number of homes in such population. To the extent the measurement period shown is less than 12 months, the turnover rate may be reflected on an annualized basis; and |
• | “Western United States” includes our Southern California, Northern California, Seattle, Phoenix, Las Vegas and Denver markets. |
June 30, 2018 | December 31, 2017 | |||||||
Assets: | (unaudited) | |||||||
Investments in single-family residential properties: | ||||||||
Land | $ | 4,635,181 | $ | 4,646,917 | ||||
Building and improvements | 13,808,251 | 13,740,981 | ||||||
18,443,432 | 18,387,898 | |||||||
Less: accumulated depreciation | (1,321,346 | ) | (1,075,634 | ) | ||||
Investments in single-family residential properties, net | 17,122,086 | 17,312,264 | ||||||
Cash and cash equivalents | 166,874 | 179,878 | ||||||
Restricted cash | 243,048 | 236,684 | ||||||
Goodwill | 258,207 | 258,207 | ||||||
Other assets, net | 875,147 | 696,605 | ||||||
Total assets | $ | 18,665,362 | $ | 18,683,638 | ||||
Liabilities: | ||||||||
Mortgage loans, net | $ | 7,620,487 | $ | 7,580,153 | ||||
Term loan facility, net | 1,489,417 | 1,487,973 | ||||||
Revolving facility | — | 35,000 | ||||||
Convertible senior notes, net | 552,861 | 548,536 | ||||||
Accounts payable and accrued expenses | 221,535 | 193,413 | ||||||
Resident security deposits | 152,075 | 146,689 | ||||||
Other liabilities | 45,410 | 41,999 | ||||||
Total liabilities | 10,081,785 | 10,033,763 | ||||||
Equity: | ||||||||
Shareholders' equity | ||||||||
Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding at June 30, 2018 and December 31, 2017 | — | — | ||||||
Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 520,493,369 and 519,173,142 outstanding at June 30, 2018 and December 31, 2017, respectively | 5,205 | 5,192 | ||||||
Additional paid-in capital | 8,619,302 | 8,602,603 | ||||||
Accumulated deficit | (303,801 | ) | (157,595 | ) | ||||
Accumulated other comprehensive income | 118,954 | 47,885 | ||||||
Total shareholders' equity | 8,439,660 | 8,498,085 | ||||||
Non-controlling interests | 143,917 | 151,790 | ||||||
Total equity | 8,583,577 | 8,649,875 | ||||||
Total liabilities and equity | $ | 18,665,362 | $ | 18,683,638 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Revenues: | ||||||||||||||||
Rental revenues | $ | 403,848 | $ | 228,504 | $ | 799,640 | $ | 454,600 | ||||||||
Other property income | 28,578 | 13,712 | 56,455 | 26,366 | ||||||||||||
Total revenues | 432,426 | 242,216 | 856,095 | 480,966 | ||||||||||||
Operating expenses: | ||||||||||||||||
Property operating and maintenance | 165,423 | 92,840 | 326,190 | 181,008 | ||||||||||||
Property management expense | 14,348 | 9,135 | 31,512 | 20,584 | ||||||||||||
General and administrative | 24,636 | 18,426 | 52,272 | 76,692 | ||||||||||||
Depreciation and amortization | 146,450 | 67,515 | 290,950 | 135,092 | ||||||||||||
Impairment and other | 4,103 | 706 | 10,224 | 1,910 | ||||||||||||
Total operating expenses | 354,960 | 188,622 | 711,148 | 415,286 | ||||||||||||
Operating income | 77,466 | 53,594 | 144,947 | 65,680 | ||||||||||||
Other expenses: | ||||||||||||||||
Interest expense | (97,226 | ) | (57,358 | ) | (189,525 | ) | (125,930 | ) | ||||||||
Other, net | 1,631 | (869 | ) | 3,367 | (1,095 | ) | ||||||||||
Total other expenses | (95,595 | ) | (58,227 | ) | (186,158 | ) | (127,025 | ) | ||||||||
Loss from continuing operations | (18,129 | ) | (4,633 | ) | (41,211 | ) | (61,345 | ) | ||||||||
Gain on sale of property, net of tax | 3,941 | 10,162 | 9,443 | 24,483 | ||||||||||||
Net income (loss) | (14,188 | ) | 5,529 | (31,768 | ) | (36,862 | ) | |||||||||
Net loss attributable to non-controlling interests | 242 | — | 553 | — | ||||||||||||
Net income (loss) attributable to common shareholders | $ | (13,946 | ) | $ | 5,529 | $ | (31,215 | ) | $ | (36,862 | ) | |||||
For the Three Months Ended June 30, 2018 | For the Three Months Ended June 30, 2017 | For the Six Months Ended June 30, 2018 | February 1, 2017 through June 30, 2017 | |||||||||||||
Net income (loss) available to common shareholders — basic and diluted (Note 12) | $ | (14,155 | ) | $ | 5,420 | $ | (31,646 | ) | $ | (20,092 | ) | |||||
Weighted average common shares outstanding — basic | 520,509,058 | 311,771,221 | 520,087,371 | 311,723,463 | ||||||||||||
Weighted average common shares outstanding — diluted | 520,509,058 | 312,271,578 | 520,087,371 | 311,723,463 | ||||||||||||
Net income (loss) per common share — basic | $ | (0.03 | ) | $ | 0.02 | $ | (0.06 | ) | $ | (0.06 | ) | |||||
Net income (loss) per common share — diluted | $ | (0.03 | ) | $ | 0.02 | $ | (0.06 | ) | $ | (0.06 | ) | |||||
Dividends declared per common share | $ | 0.11 | $ | 0.06 | $ | 0.22 | $ | 0.06 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net income (loss) | $ | (14,188 | ) | $ | 5,529 | $ | (31,768 | ) | $ | (36,862 | ) | |||||
Other comprehensive income (loss) | ||||||||||||||||
Unrealized gains (losses) on interest rate swaps | 15,826 | (14,759 | ) | 75,726 | (4,198 | ) | ||||||||||
(Gains) losses from interest rate swaps reclassified into earnings from accumulated other comprehensive income | (3,596 | ) | 6,059 | (3,325 | ) | 8,770 | ||||||||||
Other comprehensive income (loss) | 12,230 | (8,700 | ) | 72,401 | 4,572 | |||||||||||
Comprehensive income (loss) | (1,958 | ) | (3,171 | ) | 40,633 | (32,290 | ) | |||||||||
Comprehensive (income) loss attributable to non-controlling interests | 48 | — | (705 | ) | — | |||||||||||
Comprehensive income (loss) attributable to common shareholders | $ | (1,910 | ) | $ | (3,171 | ) | $ | 39,928 | $ | (32,290 | ) |
Common Stock | |||||||||||||||||||||||||||||||
Number of Shares | Amount | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Total Shareholders' Equity | Non-Controlling Interests | Total Equity | ||||||||||||||||||||||||
Balance as of December 31, 2017 | 519,173,142 | $ | 5,192 | $ | 8,602,603 | $ | (157,595 | ) | $ | 47,885 | $ | 8,498,085 | $ | 151,790 | $ | 8,649,875 | |||||||||||||||
Capital distributions | — | — | — | — | — | — | (2,033 | ) | (2,033 | ) | |||||||||||||||||||||
Net loss | — | — | — | (31,215 | ) | — | (31,215 | ) | (553 | ) | (31,768 | ) | |||||||||||||||||||
Dividends and dividend equivalents declared ($0.22 per share) | — | — | — | (114,991 | ) | — | (114,991 | ) | — | (114,991 | ) | ||||||||||||||||||||
Issuance of common stock — settlement of RSUs, net of tax | 915,190 | 9 | (7,430 | ) | — | — | (7,421 | ) | — | (7,421 | ) | ||||||||||||||||||||
Share-based compensation expense | — | — | 17,514 | — | — | 17,514 | — | 17,514 | |||||||||||||||||||||||
Total other comprehensive income | — | — | — | — | 71,143 | 71,143 | 1,258 | 72,401 | |||||||||||||||||||||||
Redemption of OP Units for common stock | 405,037 | 4 | 6,615 | — | (74 | ) | 6,545 | (6,545 | ) | — | |||||||||||||||||||||
Balance as of June 30, 2018 | 520,493,369 | $ | 5,205 | $ | 8,619,302 | $ | (303,801 | ) | $ | 118,954 | $ | 8,439,660 | $ | 143,917 | $ | 8,583,577 |
For the Six Months Ended June 30, | ||||||||
2018 | 2017 | |||||||
Operating Activities: | ||||||||
Net loss | $ | (31,768 | ) | $ | (36,862 | ) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 290,950 | 135,092 | ||||||
Share-based compensation expense | 17,514 | 52,460 | ||||||
Amortization of deferred leasing costs | 5,833 | 6,226 | ||||||
Amortization of deferred financing costs | 9,678 | 16,355 | ||||||
Amortization of debt discounts | 4,508 | 114 | ||||||
Provisions for impairment | 2,274 | 1,132 | ||||||
Gain on sale of property, net of tax | (9,443 | ) | (24,483 | ) | ||||
Change in fair value of derivative instruments | 5,852 | 3,802 | ||||||
Other noncash amounts included in net loss | (1,638 | ) | (922 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Other assets, net | (7,668 | ) | (8,564 | ) | ||||
Accounts payable and accrued expenses | 29,688 | 24,054 | ||||||
Resident security deposits | 5,386 | 2,268 | ||||||
Other liabilities | (10,831 | ) | (814 | ) | ||||
Net cash provided by operating activities | 310,335 | 169,858 | ||||||
Investing Activities: | ||||||||
Amounts deposited and held by others | 9,273 | 89 | ||||||
Acquisition of single-family residential properties | (120,149 | ) | (84,632 | ) | ||||
Initial renovations to single-family residential properties | (25,750 | ) | (13,026 | ) | ||||
Other capital expenditures for single-family residential properties | (60,916 | ) | (21,133 | ) | ||||
Corporate capital expenditures | (1,832 | ) | (1,494 | ) | ||||
Proceeds from sale of residential properties | 122,820 | 129,239 | ||||||
Purchases of investments in debt securities | (163,719 | ) | (51,920 | ) | ||||
Repayment proceeds from retained debt securities | 59,213 | 30,916 | ||||||
Other investing activities | (8,314 | ) | — | |||||
Net cash used in investing activities | (189,374 | ) | (11,961 | ) | ||||
Financing Activities: | ||||||||
Proceeds from IPO, net of underwriting discounts | — | 1,692,058 | ||||||
IPO costs paid | — | (2,757 | ) | |||||
Payment of dividends and dividend equivalents | (114,991 | ) | (18,816 | ) | ||||
Distributions to non-controlling interests | (2,033 | ) | — | |||||
Payment of taxes related to net share settlement of RSUs | (7,421 | ) | — | |||||
Redemption of Series A Preferred Stock | — | (1,153 | ) | |||||
Payments on credit facilities | — | (2,321,585 | ) | |||||
Proceeds from mortgage loans | 3,274,179 | 996,420 |
For the Six Months Ended June 30, | ||||||||
2018 | 2017 | |||||||
Payments on mortgage loans | (3,198,588 | ) | (2,083,012 | ) | ||||
Proceeds from term loan facility | — | 1,500,000 | ||||||
Proceeds from revolving facility | 100,000 | — | ||||||
Payments on revolving facility | (135,000 | ) | — | |||||
Deferred financing costs paid | (42,489 | ) | (42,065 | ) | ||||
Other financing activities | (1,258 | ) | — | |||||
Net cash used in financing activities | (127,601 | ) | (280,910 | ) | ||||
Change in cash, cash equivalents, and restricted cash | (6,640 | ) | (123,013 | ) | ||||
Cash, cash equivalents, and restricted cash, beginning of period (Note 4) | 416,562 | 420,211 | ||||||
Cash, cash equivalents, and restricted cash, end of period (Note 4) | $ | 409,922 | $ | 297,198 | ||||
Supplemental cash flow disclosures: | ||||||||
Interest paid, net of amounts capitalized | $ | 174,915 | $ | 110,561 | ||||
Cash paid for income taxes | 1,373 | 1,987 | ||||||
Noncash investing and financing activities: | ||||||||
Accrued renovation improvements at period end | $ | 6,214 | $ | 3,868 | ||||
Accrued residential property capital improvements at period end | 8,879 | 3,754 | ||||||
Transfer of residential property, net to other assets, net for held for sale assets | 93,888 | 41,278 | ||||||
Reclassification of IPO costs from other assets to additional paid-in capital | — | 2,969 | ||||||
Change in other comprehensive income from cash flow hedges | 66,894 | 4,572 | ||||||
Capital leases | 2,448 | — |
• | INVH acquired all of the assets, liabilities, and operations held directly or indirectly by IH2 through certain mergers and related transactions as follows: |
• | IH2 Property Holdings Inc., a parent entity of IH2, merged with and into INVH, with INVH as the entity surviving the merger (the “IH2 Property Holdings Merger”), and the issued and outstanding shares of IH2 Property Holdings Inc., all of which were held by certain of the Pre-IPO Owners, were converted into newly issued shares of common stock of INVH; and |
• | following the IH2 Property Holdings Merger, IH2 merged with and into INVH, with INVH as the entity surviving the merger (the “IH2 Merger”). In the IH2 Merger, all of the shares of common stock of IH2 issued and outstanding immediately prior to such merger, other than the shares held by INVH, were converted into shares of newly issued common stock of INVH. As a result of the IH2 Merger, INVH holds all of the assets and operations held directly or indirectly by IH2 prior to such merger; |
• | prior to the IH2 Merger, our Pre-IPO Owners contributed to INVH their interests in each of the other Invitation Homes Partnerships (other than IH2) in exchange for newly-issued shares of INVH; and |
• | INVH contributed to INVH LP all of the interests in the Invitation Homes Partnerships (other than IH2, the assets, liabilities and operations of which were contributed to INVH LP). |
June 30, 2018 | December 31, 2017 | |||||||
Land | $ | 4,635,181 | $ | 4,646,917 | ||||
Single-family residential property | 13,151,873 | 13,084,156 | ||||||
Capital improvements | 536,264 | 536,297 | ||||||
Equipment | 120,114 | 120,528 | ||||||
Total gross investments in the properties | 18,443,432 | 18,387,898 | ||||||
Less: accumulated depreciation | (1,321,346 | ) | (1,075,634 | ) | ||||
Investments in single-family residential properties, net | $ | 17,122,086 | $ | 17,312,264 |
As of June 30, | As of December 31, | |||||||||||||||
2018 | 2017 | 2017 | 2016 | |||||||||||||
Cash and cash equivalents | $ | 166,874 | $ | 158,934 | $ | 179,878 | $ | 198,119 | ||||||||
Restricted cash | 243,048 | 138,264 | 236,684 | 222,092 | ||||||||||||
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows | $ | 409,922 | $ | 297,198 | $ | 416,562 | $ | 420,211 |
June 30, 2018 | December 31, 2017 | |||||||
Resident security deposits | $ | 151,885 | $ | 147,098 | ||||
Property taxes | 51,631 | 20,785 | ||||||
Collections | 24,526 | 40,607 | ||||||
Standing and capital expenditure reserves | 8,351 | 5,257 | ||||||
Letters of credit | 3,441 | 3,567 | ||||||
Special and other reserves | 3,214 | 4,250 | ||||||
Derivative collateral | — | 15,120 | ||||||
Total | $ | 243,048 | $ | 236,684 |
June 30, 2018 | December 31, 2017 | |||||||
Investments in debt securities, net | $ | 483,381 | $ | 378,545 | ||||
Derivative instruments (Note 7) | 137,238 | 57,612 | ||||||
Held for sale assets(1) | 69,238 | 46,814 | ||||||
Investment in unconsolidated joint venture | 56,823 | 57,078 | ||||||
Prepaid expenses | 38,108 | 37,869 | ||||||
Rent and other receivables, net | 26,388 | 24,525 | ||||||
Corporate fixed assets, net | 17,980 | 16,595 | ||||||
Deferred leasing costs, net | 6,499 | 7,018 | ||||||
Deferred financing costs, net | 6,319 | 7,504 | ||||||
In-place leases, net | 4,624 | 37,517 | ||||||
Amounts deposited and held by others | 4,619 | 12,598 | ||||||
Other | 23,930 | 12,930 | ||||||
Total | $ | 875,147 | $ | 696,605 |
(1) | As of June 30, 2018 and December 31, 2017, 328 and 236 properties, respectively, are classified as held for sale. |
Outstanding Principal Balance(2) | ||||||||||||||||
Origination Date | Maturity Date | Interest Rate(1) | Range of Spreads | June 30, 2018 | December 31, 2017 | |||||||||||
CAH 2014-1(3) | N/A | N/A | —% | N/A | $ | — | $ | 473,384 | ||||||||
CAH 2014-2(3) | N/A | N/A | —% | N/A | — | 385,401 | ||||||||||
IH 2015-1, net(4) | N/A | N/A | —% | N/A | — | 528,795 | ||||||||||
IH 2015-2(4) | N/A | N/A | —% | N/A | — | 627,259 | ||||||||||
IH 2015-3(5) | N/A | N/A | —% | N/A | — | 1,165,886 | ||||||||||
CAH 2015-1(6) | June 11, 2015 | July 9, 2019 | 3.98% | 128-373 bps | 652,422 | 656,551 | ||||||||||
CSH 2016-1(6)(7) | June 7, 2016 | July 9, 2019 | 4.41% | 158-508 bps | 527,779 | 531,517 | ||||||||||
CSH 2016-2(6) | November 3, 2016 | December 9, 2018 | 3.94% | 133-423 bps | 604,735 | 609,815 | ||||||||||
IH 2017-1(8) | April 28, 2017 | June 9, 2027 | 4.23% | N/A | 996,279 | 996,453 | ||||||||||
SWH 2017-1(6) | September 29, 2017 | October 9, 2019 | 3.64% | 102-347 bps | 768,807 | 769,754 | ||||||||||
IH 2017-2(6) | November 9, 2017 | December 9, 2019 | 3.59% | 91-306 bps | 863,263 | 863,413 | ||||||||||
IH 2018-1(3)(6) | February 8, 2018 | March 9, 2020 | 3.33% | 76-256 bps | 914,441 | — | ||||||||||
IH 2018-2(4)(6) | May 8, 2018 | June 9, 2020 | 3.47% | 95-230 bps | 1,056,150 | — | ||||||||||
IH 2018-3(5)(6)(7) | June 28, 2018 | July 9, 2020 | 3.51% | 105-230 bps | 1,300,126 | — | ||||||||||
Total Securitizations | 7,684,002 | 7,608,228 | ||||||||||||||
Less deferred financing costs, net | (63,515 | ) | (28,075 | ) | ||||||||||||
Total | $ | 7,620,487 | $ | 7,580,153 |
(1) | Except for IH 2017-1, interest rates are based on a weighted average spread over the London Interbank Offered Rate (“LIBOR”), plus applicable servicing fees; as of June 30, 2018, LIBOR was 2.09%. Our IH 2017-1 mortgage loan bears interest at a fixed rate of 4.23% per annum, equal to the market determined pass-through rate payable on the certificates including applicable servicing fees. |
(2) | Outstanding principal balance is net of discounts and does not include deferred financing costs, net. |
(3) | On February 8, 2018, the outstanding balances of CAH 2014-1 and CAH 2014-2 were repaid in full with proceeds from IH 2018-1, a new securitization transaction. |
(4) | On May 8, 2018, the outstanding balances of IH 2015-1 and IH 2015-2 were repaid in full with proceeds from IH 2018-2, a new securitization transaction. |
(5) | On June 28, 2018, the outstanding balance of IH 2015-3 was repaid in full with proceeds from IH 2018-3, a new securitization transaction. |
(6) | The initial maturity term of each of these mortgage loans is two to three years, individually subject to two to five, one-year extension options at the borrower’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the borrower obtains a replacement interest rate cap agreement in a form reasonably acceptable to the lender). Our CSH 2016-1 and CAH 2015-1 mortgage loans have exercised the first and second extension option, respectively. The maturity dates above are reflective of all extensions that have been exercised. |
(7) | On July 9, 2018, we made a voluntary prepayment of $200,000 against the outstanding balance of CSH 2016-1 with proceeds from the IH 2018-3 securitization transaction and available cash (see Note 16). |
(8) | Net of unamortized discount of $3,169 and $3,345 as of June 30, 2018 and December 31, 2017, respectively. |
Maturity Date | Interest Rate(1) | June 30, 2018 | December 31, 2017 | |||||||||
Term Loan Facility | February 6, 2022 | 3.89% | $ | 1,500,000 | $ | 1,500,000 | ||||||
Deferred financing costs, net | (10,583 | ) | (12,027 | ) | ||||||||
Term Loan Facility, net | $ | 1,489,417 | $ | 1,487,973 | ||||||||
Revolving Facility | February 6, 2021 | 3.94% | $ | — | $ | 35,000 |
(1) | Interest rates for the Term Loan Facility and the Revolving Facility are based on LIBOR plus an applicable margin of 1.80% and 1.85%, respectively; as of June 30, 2018, LIBOR was 2.09%. |
Principal Amount | |||||||||||||||||||||
Coupon Rate | Effective Rate(1) | Conversion Rate(2) | Maturity Date | Remaining Amortization Period | June 30, 2018 | December 31, 2017 | |||||||||||||||
2019 Convertible Notes | 3.00 | % | 4.92 | % | 53.0969 | 7/1/2019 | 1.00 years | $ | 229,993 | $ | 230,000 | ||||||||||
2022 Convertible Notes | 3.50 | % | 5.12 | % | 43.7694 | 1/15/2022 | 3.55 years | 345,000 | 345,000 | ||||||||||||
Total | 574,993 | 575,000 | |||||||||||||||||||
Net unamortized fair value adjustment | (22,132 | ) | (26,464 | ) | |||||||||||||||||
Total | $ | 552,861 | $ | 548,536 |
(1) | Effective rate includes the effect of the adjustment to the fair value of the debt as of the Merger Date, the value of which reduced the initial liability recorded to $223,185 and $324,252 for each of the 2019 Convertible Notes and 2022 Convertible Notes, respectively. |
(2) | We generally have the option to settle any conversions in cash, common stock or a combination thereof. The conversion rate represents the number of shares of common stock issuable per $1,000 principal amount (actual $) of Convertible Senior Notes converted at June 30, 2018, as adjusted in accordance with the applicable indentures as a result of cash dividend payments and the effects of the Mergers. The Convertible Senior Notes do not meet the criteria for conversion as of June 30, 2018. |
Year | Mortgage Loans(1) | Term Loan Facility | Convertible Senior Notes | Total | ||||||||||||
2018 | $ | 604,735 | $ | — | $ | — | $ | 604,735 | ||||||||
2019 | 2,812,271 | — | 229,993 | 3,042,264 | ||||||||||||
2020 | 3,270,717 | — | — | 3,270,717 | ||||||||||||
2021 | — | — | — | — | ||||||||||||
2022 | — | 1,500,000 | 345,000 | 1,845,000 | ||||||||||||
2023 and thereafter | 996,279 | — | — | 996,279 | ||||||||||||
Total | 7,684,002 | 1,500,000 | 574,993 | 9,758,995 | ||||||||||||
Less deferred financing costs, net | (63,515 | ) | (10,583 | ) | — | (74,098 | ) | |||||||||
Less unamortized fair value adjustment | — | — | (22,132 | ) | (22,132 | ) | ||||||||||
Total | $ | 7,620,487 | $ | 1,489,417 | $ | 552,861 | $ | 9,662,765 |
(1) | The maturity dates of the obligations are reflective of all extensions that have been exercised. |
Agreement Date | Forward Effective Date | Maturity Date | Strike Rate | Index | Notional Amount | |||||||
December 21, 2016 | February 28, 2017 | January 31, 2022 | 1.97% | One-month LIBOR | $ | 750,000 | ||||||
December 21, 2016 | February 28, 2017 | January 31, 2022 | 1.97% | One-month LIBOR | 750,000 | |||||||
January 12, 2017 | February 28, 2017 | August 7, 2020 | 1.59% | One-month LIBOR | 1,100,000 | |||||||
January 13, 2017 | February 28, 2017 | June 9, 2020 | 1.63% | One-month LIBOR | 595,000 | |||||||
January 20, 2017 | February 28, 2017 | March 9, 2020 | 1.60% | One-month LIBOR | 325,000 | |||||||
June 3, 2016 | July 15, 2017 | July 15, 2018 | 0.93% | One-month LIBOR | 450,000 | |||||||
January 10, 2017 | January 15, 2018 | January 15, 2019 | 1.58% | One-month LIBOR | 550,000 | |||||||
February 23, 2016 | March 15, 2018 | March 15, 2019 | 1.10% | One-month LIBOR | 800,000 | |||||||
February 23, 2016 | March 15, 2018 | March 15, 2019 | 1.06% | One-month LIBOR | 800,000 | |||||||
June 3, 2016 | July 15, 2018 | July 15, 2019 | 1.12% | One-month LIBOR | 450,000 | |||||||
January 10, 2017 | January 15, 2019 | January 15, 2020 | 1.93% | One-month LIBOR | 550,000 | |||||||
April 19, 2018 | January 31, 2019 | January 31, 2025 | 2.86% | One-month LIBOR | 400,000 | |||||||
March 29, 2017 | March 15, 2019 | March 15, 2022 | 2.21% | One-month LIBOR | 800,000 | |||||||
April 19, 2018 | March 15, 2019 | November 30, 2024 | 2.85% | One-month LIBOR | 400,000 | |||||||
April 19, 2018 | March 15, 2019 | February 28, 2025 | 2.86% | One-month LIBOR | 400,000 | |||||||
June 3, 2016 | July 15, 2019 | July 15, 2020 | 1.30% | One-month LIBOR | 450,000 | |||||||
January 10, 2017 | January 15, 2020 | January 15, 2021 | 2.13% | One-month LIBOR | 550,000 | |||||||
April 19, 2018 | January 31, 2020 | November 30, 2024 | 2.90% | One-month LIBOR | 400,000 | |||||||
May 8, 2018 | March 9, 2020 | June 9, 2025 | 2.99% | One-month LIBOR | 325,000 | |||||||
May 8, 2018 | June 9, 2020 | June 9, 2025 | 2.99% | One-month LIBOR | 595,000 | |||||||
June 3, 2016 | July 15, 2020 | July 15, 2021 | 1.47% | One-month LIBOR | 450,000 | |||||||
June 28, 2018 | August 7, 2020 | July 9, 2025 | 2.90% | One-month LIBOR | 1,100,000 | |||||||
January 10, 2017 | January 15, 2021 | July 15, 2021 | 2.23% | One-month LIBOR | 550,000 |
Asset Derivatives | Liability Derivatives | |||||||||||||||||||
Fair Value as of | Fair Value as of | |||||||||||||||||||
Balance Sheet Location | June 30, 2018 | December 31, 2017 | Balance Sheet Location | June 30, 2018 | December 31, 2017 | |||||||||||||||
Derivatives designated as hedging instruments: | ||||||||||||||||||||
Interest rate swaps | Other assets | $ | 135,356 | $ | 57,612 | Other liabilities | $ | 10,824 | $ | — | ||||||||||
Derivatives not designated as hedging instruments: | ||||||||||||||||||||
Interest rate caps | Other assets | 1,882 | 27 | Other liabilities | 1,679 | — | ||||||||||||||
Total | $ | 137,238 | $ | 57,639 | $ | 12,503 | $ | — |
As of June 30, 2018 | ||||||||||||||||||||||||
Gross Amounts Not Offset in the Statement of Financial Position | ||||||||||||||||||||||||
Gross Amounts of Recognized Assets/ Liabilities | Gross Amounts Offset in the Statement of Financial Position | Net Amounts of Assets/ Liabilities Presented in the Statement of Financial Position | Financial Instruments | Cash Collateral Received | Net Amount | |||||||||||||||||||
Offsetting assets: | ||||||||||||||||||||||||
Derivatives | $ | 137,238 | $ | — | $ | 137,238 | $ | (10,260 | ) | $ | — | $ | 126,978 | |||||||||||
Offsetting liabilities: | ||||||||||||||||||||||||
Derivatives | $ | 12,503 | $ | — | $ | 12,503 | $ | (10,260 | ) | $ | — | $ | 2,243 |
Amount of Gain (Loss) Recognized in OCI on Derivative | Location of Gain (Loss) Reclassified from Accumulated OCI into Net Loss | Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Loss | Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations | |||||||||||||||||||||||
Three Months Ended June 30, | Three Months Ended June 30, | Three Months Ended June 30, | ||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||
Derivatives in cash flow hedging relationships: | ||||||||||||||||||||||||||
Interest rate swaps | $ | 15,826 | $ | (14,759 | ) | Interest expense | $ | 3,596 | $ | (6,059 | ) | $ | 97,226 | $ | 57,358 |
Location of Gain (Loss) Recognized in Net Loss on Derivative | Amount of Gain (Loss) Recognized in Net Loss on Derivative | |||||||||
Three Months Ended June 30, | ||||||||||
2018 | 2017 | |||||||||
Derivatives not designated as hedging instruments: | ||||||||||
Interest rate swaps | Interest expense | $ | — | $ | — | |||||
Interest rate caps | Interest expense | (598 | ) | (50 | ) | |||||
Total | $ | (598 | ) | $ | (50 | ) |
Amount of Gain (Loss) Recognized in OCI on Derivative | Location of Gain (Loss) Reclassified from Accumulated OCI into Net Loss | Amount of Gain (Loss) Reclassified from Accumulated OCI into Net Loss | Total Amount of Interest Expense Presented in the Condensed Consolidated Statements of Operations | |||||||||||||||||||||||
For the Six Months Ended June 30, | For the Six Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||
Derivatives in cash flow hedging relationships: | ||||||||||||||||||||||||||
Interest rate swaps | $ | 75,726 | $ | (4,198 | ) | Interest expense | $ | 3,325 | $ | (8,770 | ) | $ | 189,525 | $ | 125,930 |
Location of Gain (Loss) Recognized in Net Loss on Derivative | Amount of Gain (Loss) Recognized in Net Loss on Derivative | |||||||||
For the Six Months Ended June 30, | ||||||||||
2018 | 2017 | |||||||||
Derivatives not designated as hedging instruments: | ||||||||||
Interest rate swaps | Interest expense | $ | — | $ | (3,674 | ) | ||||
Interest rate caps | Interest expense | (345 | ) | (128 | ) | |||||
Total | $ | (345 | ) | $ | (3,802 | ) |
Record Date | Amount per Share(1) | Pay Date | Total Amount Declared | |||||||||
Q2-2018 | May 15, 2018 | $ | 0.11 | May 31, 2018 | $ | 57,559 | ||||||
Q1-2018 | February 13, 2018 | 0.11 | February 28, 2018 | 57,432 | ||||||||
Q4-2017 | October 24, 2017 | 0.08 | November 7, 2017 | 25,139 | ||||||||
Q3-2017 | August 15, 2017 | 0.08 | August 31, 2017 | 25,200 | ||||||||
Q2-2017 | May 15, 2017 | 0.06 | May 31, 2017 | 18,800 |
(1) | Amounts are displayed in actual dollars and are paid on a per share basis. |
• | 2018 Annual Long Term Incentive (“LTIP”) Awards: During the six months ended June 30, 2018, we granted 631,429 RSUs pursuant to LTIP awards. Each award is divided into three tranches, portions of which vest based on time-vesting conditions, market based vesting conditions, and performance based vesting conditions. The time-vesting RSUs vest in three equal annual installments based on an anniversary date of March 1, 2018, subject to continued employment through the applicable vesting date. |
• | Other Awards: During the six months ended June 30, 2018, we granted 136,941 RSUs to employees (the “2018 Bonus Awards”) and 48,882 RSUs to members of our board of directors. Each of the 2018 Bonus Awards is a time-vesting award which vests in three equal annual installments based on an anniversary date of March 1, 2018, subject to continued employment through the applicable vesting date. Each director award will fully vest on the date scheduled for INVH’s 2019 annual stockholders meeting, subject to continued service on the board of directors through such date. |
Time-Vesting Awards | PRSUs | Total Share-Based Awards | |||||||||||||||||||
Number | Weighted Average Grant Date Fair Value (Actual $) | Number | Weighted Average Grant Date Fair Value (Actual $) | Number | Weighted Average Grant Date Fair Value (Actual $) | ||||||||||||||||
Balance, December 31, 2017 | 2,695,902 | $ | 21.51 | 408,102 | $ | 22.25 | 3,104,004 | $ | 20.79 | ||||||||||||
Granted | 381,002 | 21.94 | 644,305 | 22.21 | 1,025,307 | 22.11 | |||||||||||||||
Vested(1) | (1,105,717 | ) | (21.26 | ) | (113,862 | ) | (23.25 | ) | (1,219,579 | ) | (21.45 | ) | |||||||||
Forfeited | (121,546 | ) | (22.73 | ) | (18,008 | ) | (21.90 | ) | (139,554 | ) | (22.62 | ) | |||||||||
Balance, June 30, 2018 | 1,849,641 | $ | 21.67 | 920,537 | $ | 22.10 | 2,770,178 | $ | 21.82 |
(1) | All vested RSUs, RSAs and PRSUs are included in basic EPS for the period during which they are outstanding. |
March 1, 2018 | ||
Expected volatility(1) | 14.5%-17.3% | |
Risk-free rate | 2.38% | |
Expected holding period (years) | 2.71-2.84 |
(1) | Expected volatility is estimated based on the historical volatility of realized returns of the Company and the applicable index. |
Share-Based Compensation Expense for the Three Months Ended June 30, | Share-Based Compensation Expense for the Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
General and administrative | $ | 6,774 | $ | 6,880 | $ | 14,328 | $ | 47,151 | ||||||||
Property management expense | 1,242 | 1,336 | 3,186 | 5,309 | ||||||||||||
Total | $ | 8,016 | $ | 8,216 | $ | 17,514 | $ | 52,460 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||||
Assets carried at historical cost on the condensed consolidated balance sheets: | ||||||||||||||||||
Investments in debt securities(1) | Level 2 | $ | 483,381 | $ | 481,228 | $ | 378,545 | $ | 379,500 | |||||||||
Liabilities carried at historical cost on the condensed consolidated balance sheets: | ||||||||||||||||||
Mortgage loans(2) | Level 2 | $ | 7,684,002 | $ | 7,649,776 | $ | 7,608,228 | $ | 7,627,423 | |||||||||
Term loan facility(3) | Level 3 | 1,500,000 | 1,495,641 | 1,500,000 | 1,494,494 | |||||||||||||
Revolving facility | Level 3 | — | — | 35,000 | 35,007 | |||||||||||||
Convertible senior notes(4) | Level 3 | 552,861 | 563,009 | 548,536 | 557,179 |
(1) | The carrying values of debt securities are shown net of discounts. |
(2) | The carrying values of the mortgage loans are shown net of discount and exclude $63,515 and $28,075 of deferred financing costs as of June 30, 2018 and December 31, 2017, respectively. |
(3) | The carrying value of the Term Loan Facility excludes $10,583 and $12,027 of deferred financing costs as of June 30, 2018 and December 31, 2017, respectively. |
(4) | The carrying values of the Convertible Senior Notes include unamortized discounts of $22,132 and $26,464 as of June 30, 2018 and December 31, 2017, respectively. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Investments in single-family residential properties, net held for use (Level 3): | ||||||||||||||||
Pre-impairment amount | $ | 764 | $ | — | $ | 764 | $ | 496 | ||||||||
Total impairments | (176 | ) | — | (176 | ) | (267 | ) | |||||||||
Fair value | $ | 588 | $ | — | $ | 588 | $ | 229 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Investments in single-family residential properties, net held for sale (Level 3): | ||||||||||||||||
Pre-impairment amount | $ | 9,183 | $ | 885 | $ | 12,408 | $ | 8,127 | ||||||||
Total impairments | (1,495 | ) | (95 | ) | (2,098 | ) | (865 | ) | ||||||||
Fair value | $ | 7,688 | $ | 790 | $ | 10,310 | $ | 7,262 |
(in thousands, except share and per share data) | For the Three Months Ended June 30, 2018 | For the Three Months Ended June 30, 2017 | For the Six Months Ended June 30, 2018 | February 1, 2017 through June 30, 2017 | ||||||||||||
Numerator: | ||||||||||||||||
Net income (loss) | $ | (14,188 | ) | $ | 5,529 | $ | (31,768 | ) | $ | (36,862 | ) | |||||
Net loss for the period January 1, 2017 through January 31, 2017 | — | — | — | 16,879 | ||||||||||||
Net loss attributable to non-controlling interests | 242 | — | 553 | — | ||||||||||||
Net income (loss) attributable to common shareholders | (13,946 | ) | 5,529 | (31,215 | ) | (19,983 | ) | |||||||||
Less net income available to participating securities | (209 | ) | (109 | ) | (431 | ) | (109 | ) | ||||||||
Net income (loss) available to common shareholders — basic and diluted | $ | (14,155 | ) | $ | 5,420 | $ | (31,646 | ) | $ | (20,092 | ) | |||||
Denominator: | ||||||||||||||||
Weighted average common shares outstanding — basic | 520,509,058 | 311,771,221 | 520,087,371 | 311,723,463 | ||||||||||||
Weighted average common shares outstanding — diluted | 520,509,058 | 312,271,578 | 520,087,371 | 311,723,463 | ||||||||||||
Net income (loss) per common share — basic | $ | (0.03 | ) | $ | 0.02 | $ | (0.06 | ) | $ | (0.06 | ) | |||||
Net income (loss) per common share — diluted | $ | (0.03 | ) | $ | 0.02 | $ | (0.06 | ) | $ | (0.06 | ) |
Consideration transferred | $ | 4,920,534 | ||
Assets acquired: | ||||
Land | 1,920,400 | |||
Buildings and improvements | 6,487,505 | |||
Cash and cash equivalents | 84,952 | |||
Restricted cash | 118,556 | |||
Other assets | 389,449 | |||
Liabilities assumed: | ||||
Mortgage loans, net | (3,433,506 | ) | ||
Convertible senior notes, net | (547,437 | ) | ||
Accounts payable and accrued expenses | (112,505 | ) | ||
Resident security deposits | (56,895 | ) | ||
Other liabilities | (36,311 | ) | ||
Non-controlling interests | (151,881 | ) | ||
Net assets acquired | 4,662,327 | |||
Goodwill | $ | 258,207 |
Three Months Ended June 30, 2017 | Six Months Ended June 30, 2017 | |||||||
Total revenue | $ | 394,796 | $ | 782,518 | ||||
Net loss | (75,556 | ) | (153,412 | ) |
Market | Number of Homes(1) | Average Occupancy(2) | Average Monthly Rent(3) | Average Monthly Rent PSF(3) | % of Revenue(4) | ||||||
Western United States | |||||||||||
Southern California | 8,334 | 96.0% | $2,262 | $1.34 | 13.1 | % | |||||
Northern California | 4,573 | 96.3% | 1,938 | 1.27 | 6.5 | % | |||||
Seattle | 3,359 | 95.2% | 2,069 | 1.09 | 5.1 | % | |||||
Phoenix | 7,464 | 96.6% | 1,260 | 0.78 | 6.9 | % | |||||
Las Vegas | 2,707 | 96.2% | 1,512 | 0.76 | 3.0 | % | |||||
Denver | 2,190 | 94.3% | 1,886 | 1.06 | 3.0 | % | |||||
Western United States Subtotal | 28,627 | 96.0% | 1,826 | 1.07 | 37.6 | % | |||||
Florida | |||||||||||
South Florida | 9,258 | 94.3% | 2,108 | 1.14 | 13.4 | % | |||||
Tampa | 8,648 | 94.5% | 1,597 | 0.87 | 9.7 | % | |||||
Orlando | 5,880 | 96.0% | 1,558 | 0.84 | 6.4 | % | |||||
Jacksonville | 1,936 | 96.1% | 1,607 | 0.81 | 2.2 | % | |||||
Florida Subtotal | 25,722 | 94.9% | 1,772 | 0.95 | 31.7 | % | |||||
Southeast United States | |||||||||||
Atlanta | 12,428 | 95.3% | 1,436 | 0.70 | 12.4 | % | |||||
Carolinas | 4,988 | 94.2% | 1,515 | 0.71 | 5.2 | % | |||||
Nashville | 782 | 93.5% | 1,820 | 0.85 | 1.0 | % | |||||
Southeast United States Subtotal | 18,198 | 94.9% | 1,473 | 0.71 | 18.6 | % | |||||
Texas | |||||||||||
Houston | 2,501 | 91.8% | 1,535 | 0.79 | 2.7 | % | |||||
Dallas | 2,256 | 94.2% | 1,713 | 0.81 | 2.7 | % | |||||
Texas Subtotal | 4,757 | 92.9% | 1,620 | 0.80 | 5.4 | % | |||||
Midwest United States | |||||||||||
Chicago | 3,951 | 93.5% | 1,942 | 1.19 | 5.2 | % | |||||
Minneapolis | 1,169 | 97.0% | 1,816 | 0.92 | 1.5 | % | |||||
Midwest United States Subtotal | 5,120 | 94.3% | 1,912 | 1.11 | 6.7 | % | |||||
Total/Average | 82,424 | 95.1% | $1,725 | $0.93 | 100.0 | % | |||||
Same Store Total / Average | 71,813 | 96.0% | $1,726 | $0.93 | 87.9 | % |
(1) | As of June 30, 2018. |
(2) | Represents average occupancy for the three months ended June 30, 2018. |
(3) | Represents average monthly rent for the three months ended June 30, 2018. |
(4) | Represents the percentage of total revenue generated in each market for the three months ended June 30, 2018. |
Three Months Ended June 30, | |||||||||||||||
($ in thousands) | 2018 | 2017 | $ Change | % Change | |||||||||||
Revenues: | |||||||||||||||
Rental revenues | $ | 403,848 | $ | 228,504 | $ | 175,344 | 76.7 | % | |||||||
Other property income | 28,578 | 13,712 | 14,866 | 108.4 | % | ||||||||||
Total revenues | 432,426 | 242,216 | 190,210 | 78.5 | % | ||||||||||
Operating expenses: | |||||||||||||||
Property operating and maintenance | 165,423 | 92,840 | 72,583 | 78.2 | % | ||||||||||
Property management expense | 14,348 | 9,135 | 5,213 | 57.1 | % | ||||||||||
General and administrative | 24,636 | 18,426 | 6,210 | 33.7 | % | ||||||||||
Depreciation and amortization | 146,450 | 67,515 | 78,935 | 116.9 | % | ||||||||||
Impairment and other | 4,103 | 706 | 3,397 | 481.2 | % | ||||||||||
Total operating expenses | 354,960 | 188,622 | 166,338 | 88.2 | % | ||||||||||
Operating income | 77,466 | 53,594 | 23,872 | 44.5 | % | ||||||||||
Other expenses: | |||||||||||||||
Interest expense | (97,226 | ) | (57,358 | ) | 39,868 | 69.5 | % | ||||||||
Other, net | 1,631 | (869 | ) | (2,500 | ) | (287.7 | )% | ||||||||
Total other expenses | (95,595 | ) | (58,227 | ) | 37,368 | 64.2 | % | ||||||||
Loss from continuing operations | $ | (18,129 | ) | $ | (4,633 | ) | $ | 13,496 | 291.3 | % |
Six Months Ended June 30, | |||||||||||||||
($ in thousands) | 2018 | 2017 | $ Change | % Change | |||||||||||
Revenues: | |||||||||||||||
Rental revenues | $ | 799,640 | $ | 454,600 | $ | 345,040 | 75.9 | % | |||||||
Other property income | 56,455 | 26,366 | 30,089 | 114.1 | % | ||||||||||
Total revenues | 856,095 | 480,966 | 375,129 | 78.0 | % | ||||||||||
Operating expenses: | |||||||||||||||
Property operating and maintenance | 326,190 | 181,008 | 145,182 | 80.2 | % | ||||||||||
Property management expense | 31,512 | 20,584 | 10,928 | 53.1 | % | ||||||||||
General and administrative | 52,272 | 76,692 | (24,420 | ) | (31.8 | )% | |||||||||
Depreciation and amortization | 290,950 | 135,092 | 155,858 | 115.4 | % | ||||||||||
Impairment and other | 10,224 | 1,910 | 8,314 | 435.3 | % | ||||||||||
Total operating expenses | 711,148 | 415,286 | 295,862 | 71.2 | % | ||||||||||
Operating income | 144,947 | 65,680 | 79,267 | 120.7 | % | ||||||||||
Other expenses: | |||||||||||||||
Interest expense | (189,525 | ) | (125,930 | ) | 63,595 | 50.5 | % | ||||||||
Other, net | 3,367 | (1,095 | ) | (4,462 | ) | (407.5 | )% | ||||||||
Total other expenses | (186,158 | ) | (127,025 | ) | 59,133 | 46.6 | % | ||||||||
Loss from continuing operations | $ | (41,211 | ) | $ | (61,345 | ) | $ | 20,134 | 32.8 | % |
Outstanding Principal Balance(3) | ||||||||||||||||
($ in thousands) | Maturity Date | Maturity Date if Fully Extended(1) | Interest Rate(2) | Range of Spreads | June 30, 2018 | December 31, 2017 | ||||||||||
CAH 2014-1(4) | N/A | N/A | —% | N/A | $ | — | $ | 473,384 | ||||||||
CAH 2014-2(4) | N/A | N/A | —% | N/A | — | 385,401 | ||||||||||
IH 2015-1, net(5) | N/A | N/A | —% | N/A | — | 528,795 | ||||||||||
IH 2015-2(5) | N/A | N/A | —% | N/A | — | 627,259 | ||||||||||
IH 2015-3(6) | N/A | N/A | —% | N/A | — | 1,165,886 | ||||||||||
CAH 2015-1(7) | July 9, 2019 | July 9, 2020 | 3.98% | 128-373 bps | 652,422 | 656,551 | ||||||||||
CSH 2016-1(7)(8) | July 9, 2019 | July 9, 2021 | 4.41% | 158-508 bps | 527,779 | 531,517 | ||||||||||
CSH 2016-2(7) | December 9, 2018 | December 9, 2021 | 3.94% | 133-423 bps | 604,735 | 609,815 | ||||||||||
IH 2017-1(9) | June 9, 2027 | June 9, 2027 | 4.23% | N/A | 996,279 | 996,453 | ||||||||||
SWH 2017-1(7) | October 9, 2019 | January 9, 2023 | 3.64% | 102-347 bps | 768,807 | 769,754 | ||||||||||
IH 2017-2(7) | December 9, 2019 | December 9, 2024 | 3.59% | 91-306 bps | 863,263 | 863,413 | ||||||||||
IH 2018-1(4)(7) | March 9, 2020 | March 9, 2025 | 3.33% | 76-256 bps | 914,441 | — | ||||||||||
IH 2018-2(5)(7) | June 9, 2020 | June 9, 2025 | 3.47% | 95-230 bps | 1,056,150 | — | ||||||||||
IH 2018-3(6)(7)(8) | July 9, 2020 | July 9, 2025 | 3.51% | 105-230 bps | 1,300,126 | — | ||||||||||
Total Securitizations | 7,684,002 | 7,608,228 | ||||||||||||||
Less deferred financing costs, net | (63,515 | ) | (28,075 | ) | ||||||||||||
Total | $ | 7,620,487 | $ | 7,580,153 |
(1) | Represents the maturity date if we exercise each of the remaining one-year extension options available, which are subject to certain conditions being met. |
(2) | Except for IH 2017-1, interest rates are based on a weighted average spread over the London Interbank Offered Rate (“LIBOR”), plus applicable servicing fees; as of June 30, 2018, LIBOR was 2.09%. Our IH 2017-1 mortgage loan bears interest at a fixed rate of 4.23% per annum, equal to the market determined pass-through rate payable on the certificates including applicable servicing fees. |
(3) | Outstanding principal balance is net of discounts and does not include deferred financing costs, net. |
(4) | On February 8, 2018, the outstanding balances of CAH 2014-1 and CAH 2014-2 were repaid in full with proceeds from IH 2018-1, a new securitization transaction. |
(5) | On May 8, 2018, the outstanding balances of IH 2015-1 and IH 2015-2 were repaid in full with proceeds from IH 2018-2, a new securitization transaction. |
(6) | On June 28, 2018, the outstanding balance of IH 2015-3 was repaid in full with proceeds from IH 2018-3, a new securitization transaction. |
(7) | The initial maturity term of each of these mortgage loans is two to three years, individually subject to two to five, one-year extension options at the borrower’s discretion (provided that there is no continuing event of default under the mortgage loan agreement and the borrower obtains a replacement interest rate cap agreement in a form reasonably acceptable to the lender). Our CSH 2016-1 and CAH 2015-1 mortgage loans have exercised the first and second extension option, respectively. The maturity dates above are reflective of all extensions that have been exercised. |
(8) | On July 9, 2018, we made a voluntary prepayment of $200.0 million against the outstanding balance of CSH 2016-1 with proceeds from the IH 2018-3 securitization transaction and available cash. |
(9) | Net of unamortized discount of $3.2 million and $3.3 million June 30, 2018 and December 31, 2017, respectively. |
($ in thousands) | Maturity Date | Interest Rate(1) | June 30, 2018 | December 31, 2017 | ||||||||
Term Loan Facility | February 6, 2022 | 3.89% | $ | 1,500,000 | $ | 1,500,000 | ||||||
Deferred financing costs, net | (10,583 | ) | (12,027 | ) | ||||||||
Term Loan Facility, net | $ | 1,489,417 | $ | 1,487,973 | ||||||||
Revolving Facility | February 6, 2021 | 3.94% | $ | — | $ | 35,000 |
(1) | Interest rates for the Term Loan Facility and the Revolving Facility are based on LIBOR plus an applicable margin of 1.80% and 1.85%, respectively; as of June 30, 2018, LIBOR was 2.09%. |
Principal Amount | |||||||||||||||||||||
($ in thousands) | Coupon Rate | Effective Rate(1) | Conversion Rate(2) | Maturity Date | Remaining Amortization Period | June 30, 2018 | December 31, 2017 | ||||||||||||||
2019 Convertible Notes | 3.00 | % | 4.92 | % | 53.0969 | 7/1/2019 | 1.00 years | $ | 229,993 | $ | 230,000 | ||||||||||
2022 Convertible Notes | 3.50 | % | 5.12 | % | 43.7694 | 1/15/2022 | 3.55 years | 345,000 | 345,000 | ||||||||||||
Total | 574,993 | 575,000 | |||||||||||||||||||
Net unamortized fair value adjustment | (22,132 | ) | (26,464 | ) | |||||||||||||||||
Total | $ | 552,861 | $ | 548,536 |
(1) | Effective rate includes the effect of the adjustment to the fair value of the debt as of the Merger Date, the value of which reduced the initial liability recorded to $223.2 million and $324.3 million for each of the 2019 Convertible Notes and 2022 Convertible Notes, respectively. |
(2) | We generally have the option to settle any conversions in cash, common stock or a combination thereof. The conversion rate represents the number of shares of common stock issuable per $1,000 principal amount (actual $) of Convertible Senior Notes converted at June 30, 2018, as adjusted in accordance with the applicable indentures as a result of cash dividend payments and the effects of the Mergers. The Convertible Senior Notes do not meet the criteria for conversion as of June 30, 2018. |
Agreement Date | Forward Effective Date | Maturity Date | Strike Rate | Index | Notional Amount | |||||||
December 21, 2016 | February 28, 2017 | January 31, 2022 | 1.97% | One-month LIBOR | $ | 750,000 | ||||||
December 21, 2016 | February 28, 2017 | January 31, 2022 | 1.97% | One-month LIBOR | 750,000 | |||||||
January 12, 2017 | February 28, 2017 | August 7, 2020 | 1.59% | One-month LIBOR | 1,100,000 | |||||||
January 13, 2017 | February 28, 2017 | June 9, 2020 | 1.63% | One-month LIBOR | 595,000 | |||||||
January 20, 2017 | February 28, 2017 | March 9, 2020 | 1.60% | One-month LIBOR | 325,000 | |||||||
June 3, 2016 | July 15, 2017 | July 15, 2018 | 0.93% | One-month LIBOR | 450,000 | |||||||
January 10, 2017 | January 15, 2018 | January 15, 2019 | 1.58% | One-month LIBOR | 550,000 | |||||||
February 23, 2016 | March 15, 2018 | March 15, 2019 | 1.10% | One-month LIBOR | 800,000 | |||||||
February 23, 2016 | March 15, 2018 | March 15, 2019 | 1.06% | One-month LIBOR | 800,000 | |||||||
June 3, 2016 | July 15, 2018 | July 15, 2019 | 1.12% | One-month LIBOR | 450,000 | |||||||
January 10, 2017 | January 15, 2019 | January 15, 2020 | 1.93% | One-month LIBOR | 550,000 | |||||||
April 19, 2018 | January 31, 2019 | January 31, 2025 | 2.86% | One-month LIBOR | 400,000 | |||||||
March 29, 2017 | March 15, 2019 | March 15, 2022 | 2.21% | One-month LIBOR | 800,000 | |||||||
April 19, 2018 | March 15, 2019 | November 30, 2024 | 2.85% | One-month LIBOR | 400,000 | |||||||
April 19, 2018 | March 15, 2019 | February 28, 2025 | 2.86% | One-month LIBOR | 400,000 | |||||||
June 3, 2016 | July 15, 2019 | July 15, 2020 | 1.30% | One-month LIBOR | 450,000 | |||||||
January 10, 2017 | January 15, 2020 | January 15, 2021 | 2.13% | One-month LIBOR | 550,000 | |||||||
April 19, 2018 | January 31, 2020 | November 30, 2024 | 2.90% | One-month LIBOR | 400,000 | |||||||
May 8, 2018 | March 9, 2020 | June 9, 2025 | 2.99% | One-month LIBOR | 325,000 | |||||||
May 8, 2018 | June 9, 2020 | June 9, 2025 | 2.99% | One-month LIBOR | 595,000 | |||||||
June 3, 2016 | July 15, 2020 | July 15, 2021 | 1.47% | One-month LIBOR | 450,000 | |||||||
June 28, 2018 | August 7, 2020 | July 9, 2025 | 2.90% | One-month LIBOR | 1,100,000 | |||||||
January 10, 2017 | January 15, 2021 | July 15, 2021 | 2.23% | One-month LIBOR | 550,000 |
Six Months Ended June 30, | |||||||||||||||
($ in thousands) | 2018 | 2017 | $ Change | % Change | |||||||||||
Net cash provided by operating activities | $ | 310,335 | $ | 169,858 | $ | 140,477 | 82.7 | % | |||||||
Net cash used in investing activities | (189,374 | ) | (11,961 | ) | (177,413 | ) | N/M | ||||||||
Net cash used in financing activities | (127,601 | ) | (280,910 | ) | 153,309 | 54.6 | % | ||||||||
Change in cash and cash equivalents | $ | (6,640 | ) | $ | (123,013 | ) | $ | 116,373 | 94.6 | % |
($ in thousands) | Total | 2018(1) | 2019-2020 | 2021-2022 | Thereafter | |||||||||||||||
Mortgage loans, net(2)(3) | $ | 9,388,272 | $ | 145,437 | $ | 1,217,191 | $ | 1,599,353 | $ | 6,426,291 | ||||||||||
Term Loan Facility, net(2) | 1,713,302 | 29,823 | 118,320 | 1,565,159 | — | |||||||||||||||
Revolving Facility(2)(3)(4) | 12,794 | 1,789 | 7,098 | 3,907 | ||||||||||||||||
Convertible Senior Notes(5) | 633,642 | 9,487 | 261,043 | 363,112 | — | |||||||||||||||
Derivative instruments(6) | 160,007 | — | 31,132 | 60,817 | 68,058 | |||||||||||||||
Purchase commitments(7) | 34,544 | 34,544 | — | — | — | |||||||||||||||
Operating lease obligations | 18,562 | 2,670 | 8,521 | 5,192 | 2,179 | |||||||||||||||
Capital lease obligations | 1,966 | 243 | 1,034 | 689 | — | |||||||||||||||
Total | $ | 11,963,089 | $ | 223,993 | $ | 1,644,339 | $ | 3,598,229 | $ | 6,496,528 |
(1) | Includes estimated payments for the remaining six months of 2018. |
(2) | Includes estimated interest payments on the respective debt based on amounts outstanding as of June 30, 2018 at rates in effect as of such date; as of June 30, 2018, LIBOR was 2.09%. |
(3) | Represents the maturity date if we exercise each of the remaining one-year extension options available, which are subject to certain conditions being met. See Part I. Item 1. “Financial Statements — Note 6 of Notes to Condensed Consolidated Financial Statements” for a description of maturity dates without consideration of extension options. |
(4) | Includes the related unused commitment fee. |
(5) | Represents the principal amount of the Convertible Senior Notes and interest obligations which are calculated using coupon rates of the Convertible Senior Notes. |
(6) | Includes interest rate swap and interest rate cap obligations calculated using LIBOR as of June 30, 2018, or 2.09%. |
(7) | Represents commitments to acquire 122 single-family rental homes, as of June 30, 2018. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
($ in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income (loss) available to common shareholders | $ | (14,155 | ) | $ | 5,420 | $ | (31,646 | ) | $ | (36,971 | ) | |||||
Net income available to participating securities | 209 | 109 | 431 | 109 | ||||||||||||
Non-controlling interests | (242 | ) | — | (553 | ) | — | ||||||||||
Interest expense | 97,226 | 57,358 | 189,525 | 125,930 | ||||||||||||
Depreciation and amortization | 146,450 | 67,515 | 290,950 | 135,092 | ||||||||||||
EBITDA | 229,488 | 130,402 | 448,707 | 224,160 | ||||||||||||
Gain on sale of property, net of tax | (3,941 | ) | (10,162 | ) | (9,443 | ) | (24,483 | ) | ||||||||
Impairment on depreciated real estate investments | 1,671 | 95 | 2,274 | 1,132 | ||||||||||||
EBITDAre | 227,218 | 120,335 | 441,538 | 200,809 | ||||||||||||
Share-based compensation expense(1) | 8,016 | 8,216 | 17,514 | 52,460 | ||||||||||||
IPO related expenses | — | 656 | — | 8,287 | ||||||||||||
Merger and transaction-related expenses | 4,236 | — | 8,603 | — | ||||||||||||
Severance | 1,681 | — | 4,340 | — | ||||||||||||
Casualty losses, net(2) | 2,432 | 611 | 7,950 | 778 | ||||||||||||
Other, net(3) | (1,631 | ) | 869 | (3,367 | ) | 1,095 | ||||||||||
Adjusted EBITDAre | $ | 241,952 | $ | 130,687 | $ | 476,578 | $ | 263,429 |
(1) | For the three months ended June 30, 2018 and 2017, $6,774 and $6,880 was recorded in general and administrative expense, respectively, and $1,242 and $1,336 was recorded in property management expense, respectively. For the six months ended June 30, 2018 and 2017, and $14,328 and $47,151 was recorded in general and administrative expense, respectively, and $3,186 and $5,309 was recorded in property management expense, respectively. |
(2) | Includes $1,238 and $5,421 for losses/damages related to Hurricanes Irma and Harvey for the three and six months ended June 30, 2018, respectively. |
(3) | Includes interest income and other miscellaneous income and expenses. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
($ in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income (loss) available to common shareholders | $ | (14,155 | ) | $ | 5,420 | $ | (31,646 | ) | $ | (36,971 | ) | |||||
Net income available to participating securities | 209 | 109 | 431 | 109 | ||||||||||||
Non-controlling interests | (242 | ) | — | (553 | ) | — | ||||||||||
Interest expense | 97,226 | 57,358 | 189,525 | 125,930 | ||||||||||||
Depreciation and amortization | 146,450 | 67,515 | 290,950 | 135,092 | ||||||||||||
General and administrative(1) | 24,636 | 18,426 | 52,272 | 76,692 | ||||||||||||
Property management expense(2) | 14,348 | 9,135 | 31,512 | 20,584 | ||||||||||||
Impairment and other(3) | 4,103 | 706 | 10,224 | 1,910 | ||||||||||||
Gain on sale of property, net of tax | (3,941 | ) | (10,162 | ) | (9,443 | ) | (24,483 | ) | ||||||||
Other, net(4) | (1,631 | ) | 869 | (3,367 | ) | 1,095 | ||||||||||
NOI (total portfolio) | 267,003 | 149,376 | 529,905 | 299,958 | ||||||||||||
Starwood Waypoint Homes NOI(5) | — | 90,586 | — | 181,438 | ||||||||||||
Non-Same Store NOI | (31,798 | ) | (15,944 | ) | (60,886 | ) | (31,713 | ) | ||||||||
NOI (Same Store portfolio)(6) | $ | 235,205 | $ | 224,018 | $ | 469,019 | $ | 449,683 |
(1) | Includes $6,774 and $6,880 of share-based compensation expense for the three months ended June 30, 2018 and 2017, respectively. Includes $14,328 and $47,151 of share-based compensation expense for the six months ended June 30, 2018 and 2017, respectively. |
(2) | Includes $1,242 and $1,336 of share-based compensation expense for the three months ended June 30, 2018 and 2017, respectively. Includes $3,186 and $5,309 of share-based compensation expense for the six months ended June 30, 2018 and 2017, respectively. |
(3) | Includes $1,238 and $5,421 for losses/damages related to Hurricanes Irma and Harvey for the three and six months ended June 30, 2018, respectively. |
(4) | Includes interest income and other miscellaneous income and expenses. |
(5) | Represents NOI generated by SWH prior to its merger with Invitation Homes, expressed using Invitation Homes' definition of NOI. |
(6) | The Same Store portfolio (consisting of homes which had commenced their initial post-renovation lease prior to October 1st of the year prior to the first year of the comparison period) totaled 71,813 homes for the three and six months ended June 30, 2018. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
(in thousands, except shares and per share data) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income (loss) available to common shareholders | $ | (14,155 | ) | $ | 5,420 | $ | (31,646 | ) | $ | (36,971 | ) | |||||
Add (deduct) adjustments from net income (loss) to derive FFO: | ||||||||||||||||
Net income available to participating securities | 209 | 109 | 431 | 109 | ||||||||||||
Non-controlling interests | (242 | ) | — | (553 | ) | — | ||||||||||
Depreciation and amortization on real estate assets | 144,947 | 66,699 | 288,055 | 133,352 | ||||||||||||
Impairment on depreciated real estate investments | 1,671 | 95 | 2,274 | 1,132 | ||||||||||||
Net gain on sale of previously depreciated investments in real estate | (3,941 | ) | (10,162 | ) | (9,443 | ) | (24,483 | ) | ||||||||
FFO | 128,489 | 62,161 | 249,118 | 73,139 | ||||||||||||
Noncash interest expense related to amortization of deferred financing costs, loan discounts and noncash interest expense from derivatives | 11,543 | 5,137 | 20,038 | 20,271 | ||||||||||||
Share-based compensation expense(1) | 8,016 | 8,216 | 17,514 | 52,460 | ||||||||||||
IPO related expenses | — | 656 | — | 8,287 | ||||||||||||
Merger and transaction-related expenses | 4,236 | — | 8,603 | — | ||||||||||||
Severance expense | 1,681 | 392 | 4,340 | 437 | ||||||||||||
Casualty losses, net(2) | 2,432 | 611 | 7,950 | 778 | ||||||||||||
Core FFO | 156,397 | 77,173 | 307,563 | 155,372 | ||||||||||||
Recurring capital expenditures | (28,848 | ) | (11,605 | ) | (54,241 | ) | (20,834 | ) | ||||||||
Adjusted FFO | $ | 127,549 | $ | 65,568 | $ | 253,322 | $ | 134,538 | ||||||||
Weighted average common shares outstanding — diluted(3) | 520,509,058 | 312,271,578 | 520,087,371 | 311,723,463 | ||||||||||||
Net income (loss) per common share — diluted(4) | $ | (0.03 | ) | $ | 0.02 | $ | (0.06 | ) | $ | (0.06 | ) | |||||
Weighted average common shares and OP Units outstanding — diluted(5) | 530,509,568 | 312,271,578 | 530,417,389 | 311,723,463 | ||||||||||||
FFO per common share — diluted | $ | 0.24 | $ | 0.20 | $ | 0.47 | $ | 0.23 | ||||||||
Core FFO per common share — diluted | $ | 0.29 | $ | 0.25 | $ | 0.58 | $ | 0.50 | ||||||||
AFFO per common share — diluted | $ | 0.24 | $ | 0.21 | $ | 0.48 | $ | 0.43 |
(1) | For the three months ended June 30, 2018 and 2017, $6,774 and $6,880 was recorded in general and administrative expense, respectively, and $1,242 and $1,336 was recorded in property management expense, respectively. For the six months ended June 30, 2018 and 2017, and $14,328 and $47,151 was recorded in general and administrative expense, respectively, and $3,186 and $5,309 was recorded in property management expense, respectively. |
(2) | Includes $1,238 and $5,421 for losses/damages related to Hurricanes Irma and Harvey for the three and six months ended June 30, 2018, respectively. |
(3) | Weighted average common shares outstanding – diluted is calculated in accordance with GAAP and is used in the calculation of net income (loss) per common share – diluted. See Part I. Item 1. “Financial Statements — Note 12 of Notes to Condensed Consolidated Financial Statements” for a description of this calculation. |
(4) | Net income (loss) per common share – diluted is calculated based on net income (loss) available to common shareholders only for the period after February 1, 2017, the date on which our common stock began trading on the New York Stock Exchange. For the period from February 1, 2017 through June 30, 2017 we had a net loss of $20,092. See Part I. Item 1. “Financial Statements — Note 12 of Notes to Condensed Consolidated Financial Statements.” |
(5) | Weighted average common shares and OP Units outstanding – diluted is calculated using the treasury stock method and represents common share equivalents, including units of partnership interests in INVH LP (“OP Units”), that are dilutive for FFO, Core FFO, and AFFO. |
Exhibit number | Description | |
3.1 | ||
3.2 | ||
10.1 | ||
10.2 | ||
10.3 | ||
10.4 | ||
10.5 | ||
10.6 | ||
31.1 | ||
31.2 |
Exhibit number | Description | |
32.1 | ||
32.2 | ||
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
Invitation Homes Inc. | |
By: | /s/ Ernest M. Freedman |
Name: Ernest M. Freedman | |
Title: Executive Vice President and Chief Financial Officer | |
(Principal Financial Officer) | |
By: | /s/ Kimberly K. Norrell |
Name: Kimberly K. Norrell | |
Title: Senior Vice President and Chief Accounting Officer | |
(Principal Accounting Officer) |
Time Vesting RSUs Granted: | [●] |
Performance Vesting (Target) RSUs Granted: | [●], consisting of: |
Tranche | Performance Condition | Performance Period | Threshold Level of Achievement | Target Level of Achievement | Maximum Level of Achievement |
Tranche I | INVH TSR Relative to RMS Index CAGR | January 1, 2018 - December 31, 2020 | [●] | [●] | [●] |
Tranche II | Same Store NOI Growth CAGR | January 1, 2018 - December 31, 2020 | [●] | [●] | [●] |
Level of Achievement | Percentage of Award Earned |
Below Threshold | 0% |
Threshold | 50% |
Target | 100% |
Maximum | 200% |
Above Maximum | 200% |
3. | Vesting of Earned RSUs. |
4. | Definitions. For the purposes of this Award Notice: |
1. | Definitions. Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan. The following terms shall have the following meanings for purposes of this Agreement: |
2. | Grant of Units. The Company hereby grants the RSUs to the Participant, each of which represents the right to receive one Share upon vesting of such RSU, subject |
3. | RSU Account. The Company shall cause an account (the “Unit Account”) to be established and maintained on the books of the Company to record the number of RSUs credited to the Participant under the terms of this Agreement. The Participant’s interest in the Unit Account shall be that of a general, unsecured creditor of the Company. |
4. | Vesting; Settlement. The RSUs shall become vested in accordance with the schedule set forth on the Award Notice. The Company shall deliver to the Participant one share of Common Stock for each RSU (as adjusted under the Plan) which becomes vested in a given calendar year, pursuant to Section 13, below, and such vested RSU shall be cancelled upon such delivery. |
5. | Termination of Employment. |
6. | Change in Control. |
7. | Dividends. |
13. | Settlement and Issuance of Shares; Tax Withholding. |
16. | Governing Law; Arbitration and Venue. |
18. | Data Privacy Consent. |
22. | Section 409A of the Code. |
INVITATION HOMES INC. | |
By: | |
Name: Mark A. Solls | |
Title: Executive Vice President and Chief Legal Officer | |
(a) | Confidentiality. |
1. | I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018 of Invitation Homes Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
By: | /s/ Frederick C. Tuomi |
Frederick C. Tuomi | |
President and Chief Executive Officer | |
(Principal Executive Officer) | |
August 10, 2018 |
1. | I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018 of Invitation Homes Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
By: | /s/ Ernest M. Freedman |
Ernest M. Freedman | |
Chief Financial Officer | |
(Principal Financial Officer) | |
August 10, 2018 |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
By: | /s/ Frederick C. Tuomi |
Frederick C. Tuomi | |
President and Chief Executive Officer | |
(Principal Executive Officer) |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
By: | /s/ Ernest M. Freedman |
Ernest M. Freedman | |
Chief Financial Officer | |
(Principal Financial Officer) |
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Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Aug. 07, 2018 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Invitation Homes Inc. | |
Entity Central Index Key | 0001687229 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Stock Outstanding (in shares) | 520,540,209 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Jun. 30, 2018 |
Dec. 31, 2017 |
Feb. 06, 2017 |
---|---|---|---|
Statement of Financial Position [Abstract] | |||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 900,000,000 | 900,000,000 | 900,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 | |
Common stock shares, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 9,000,000,000 | 9,000,000,000 | 9,000,000,000 |
Common stock, shares outstanding (in shares) | 520,493,369 | 519,173,142 |
CONDENSED CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (14,188) | $ 5,529 | $ (31,768) | $ (36,862) |
Other comprehensive income (loss) | ||||
Unrealized gains (losses) on interest rate swaps | 15,826 | (14,759) | 75,726 | (4,198) |
(Gains) losses from interest rate swaps reclassified into earnings from accumulated other comprehensive income | (3,596) | 6,059 | (3,325) | 8,770 |
Other comprehensive income (loss) | 12,230 | (8,700) | 72,401 | 4,572 |
Comprehensive income (loss) | (1,958) | (3,171) | 40,633 | (32,290) |
Comprehensive (income) loss attributable to non-controlling interests | 48 | 0 | (705) | 0 |
Comprehensive income (loss) attributable to common shareholders | $ (1,910) | $ (3,171) | $ 39,928 | $ (32,290) |
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - 6 months ended Jun. 30, 2018 - USD ($) $ in Thousands |
Total |
Common Stock |
Additional Paid-in Capital |
Accumulated Deficit |
Accumulated Other Comprehensive Income |
Total Shareholders' Equity |
Non-Controlling Interests |
---|---|---|---|---|---|---|---|
Beginning Balance, common stock, shares outstanding (in shares) at Dec. 31, 2017 | 519,173,142 | 519,173,142 | |||||
Beginning Balance at Dec. 31, 2017 | $ 8,649,875 | $ 5,192 | $ 8,602,603 | $ (157,595) | $ 47,885 | $ 8,498,085 | $ 151,790 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Capital distributions | (2,033) | (2,033) | |||||
Net Income (Loss) Attributable to Parent | (31,215) | ||||||
Net loss | (31,768) | (31,215) | (31,215) | (553) | |||
Dividends and dividend equivalents declared ($0.22 per share) | $ (114,991) | (114,991) | (114,991) | ||||
Issuance of common stock — settlement of RSUs, net of tax (in shares) | 915,190 | 915,190 | |||||
Issuance of common stock — settlement of RSUs, net of tax | $ (7,421) | $ 9 | (7,430) | (7,421) | |||
Share-based compensation expense | 17,514 | 17,514 | 17,514 | ||||
Total other comprehensive income | $ 72,401 | 71,143 | 71,143 | 1,258 | |||
Redemption of OP Units for common stock (in shares) | 405,037 | 405,037 | |||||
Redemption of OP Units for common stock | $ 0 | $ 4 | 6,615 | (74) | 6,545 | (6,545) | |
Ending Balance, common stock, shares outstanding (in shares) at Jun. 30, 2018 | 520,493,369 | 520,493,369 | |||||
Ending Balance at Jun. 30, 2018 | $ 8,583,577 | $ 5,205 | $ 8,619,302 | $ (303,801) | $ 118,954 | $ 8,439,660 | $ 143,917 |
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares |
3 Months Ended | 6 Months Ended | 17 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|---|
May 15, 2018 |
Feb. 13, 2018 |
Oct. 24, 2017 |
Aug. 15, 2017 |
May 15, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2018 |
|
Statement of Stockholders' Equity [Abstract] | |||||||||
Dividends declared per common share (in dollars per share) | $ 0.11 | $ 0.11 | $ 0.08 | $ 0.08 | $ 0.06 | $ 0.11 | $ 0.06 | $ 0.22 | $ 0.06 |
Organization and Formation |
6 Months Ended | ||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||
Organization and Formation | Note 1—Organization and Formation Invitation Homes Inc. (“INVH”) was formed for the purpose of owning, renovating, leasing, and operating single-family residential properties. On February 6, 2017, INVH completed an initial public offering (“IPO”) of 88,550,000 shares of common stock at a price to the public of $20.00 per share. An additional 221,826,634 shares of common stock were issued to the Pre-IPO Owners (as defined below) on January 31, 2017. On November 16, 2017, INVH merged with Starwood Waypoint Homes (“SWH”) as more fully described below resulting in the issuance of an additional 207,448,958 shares of common stock. Prior to the IPO, we conducted our business through a combination of entities formed by Blackstone Real Estate Partners VII L.P. (“BREP VII”), an investment fund sponsored by The Blackstone Group L.P., along with BREP VII’s affiliated side-by-side funds and co-investment vehicles (“BREP VII and Affiliates”). The first Invitation Homes partnership was formed on June 12, 2012, through the establishment of Invitation Homes L.P. (“IH1”) and its wholly-owned subsidiary, THR Property Management L.P. (the “Manager”). Preeminent Holdings, Inc. (“IH2”) was created on February 14, 2013, Invitation Homes 3 L.P. (“IH3”) on August 8, 2013, Invitation Homes 4 L.P. (“IH4”) on January 10, 2014, Invitation Homes 5 L.P. (“IH5”) on August 22, 2014, and Invitation Homes 6 L.P. (“IH6”) on June 15, 2015 (collectively with IH1, the “Invitation Homes Partnerships”). Through the Manager, we provide all management and other administrative services with respect to the properties we own. The collective owners of the Invitation Homes Partnerships prior to the IPO are referred to as the “Pre-IPO Owners.” Invitation Homes Operating Partnership LP (“INVH LP”) and its general partner, Invitation Homes OP GP LLC (the “OP General Partner”), were formed by one of our Pre-IPO Owners on December 14, 2016. INVH LP began negotiating and entering into certain debt and hedge instruments upon its inception in anticipation of our IPO. Prior to the IPO, the Invitation Homes Partnerships and INVH LP were under the common control of BREP VII and Affiliates. BREP VII and Affiliates had the ability to control each of the Invitation Homes Partnerships and manage and operate the Invitation Homes Partnerships through the Manager and a common board of directors. As such, prior to the IPO our historical financial statements include assets, liabilities and results of operations of INVH LP and the Invitation Homes Partnerships and their consolidated subsidiaries on a combined and consolidated basis. As a result of the Pre-IPO Transactions described below, IH2 was effectively merged into INVH (and the assets and liabilities of IH2 were contributed to INVH LP), and the remaining Invitation Homes Partnerships became wholly-owned subsidiaries of INVH through INVH LP. On October 4, 2016, INVH was incorporated in the State of Delaware and was capitalized as of that date by an investment from one of our Pre-IPO Owners. Since inception, and through the date of the Pre-IPO Transactions (as described below), INVH did not engage in any business or activity. On February 6, 2017, INVH changed its jurisdiction of incorporation to Maryland. The Pre-IPO Transactions also included amendments to the INVH charter which provide for the issuance of up to 9,000,000,000 shares of common stock and 900,000,000 shares of preferred stock, $0.01 par value per share. Our organizational structure includes several wholly-owned subsidiaries that were formed to facilitate our financing arrangements (the “Borrower Entities”). These Borrower Entities are used to align the ownership of our single-family residential properties with individual debt instruments. Collateral for the individual debt instruments may be in the form of equity interests in the Borrower Entities or in pools of single-family residential properties owned either directly by the Borrower Entities or indirectly by their wholly-owned subsidiaries (see Note 6). References to “Invitation Homes,” the “Company,” “we,” “our,” and “us” refer, collectively, to INVH, INVH LP, and the consolidated subsidiaries of INVH LP, including the Manager. References to “SWH” refer to Starwood Waypoint Homes and its subsidiaries. Pre-IPO Transactions On January 31, 2017, we effected certain transactions (the “Pre-IPO Transactions”) that resulted in INVH LP holding, directly or indirectly, all of the assets, liabilities, and results of operations of the Invitation Homes Partnerships, including the full portfolio of homes held by the Invitation Homes Partnerships. As a result of the Pre-IPO Transactions, INVH LP was wholly-owned by INVH directly and through its wholly-owned subsidiary, the OP General Partner. More specifically:
The Pre-IPO Transactions were accounted for as a reorganization of entities under common control utilizing historical cost basis. Merger with Starwood Waypoint Homes On November 16, 2017 (the “Merger Date”), pursuant to an Agreement and Plan of Merger, dated as of August 9, 2017 (the “Merger Agreement”), by and among INVH, INVH LP, IH Merger Sub, LLC, a Delaware limited liability company and a direct wholly-owned subsidiary of INVH (“REIT Merger Sub”), SWH and Starwood Waypoint Homes Partnership, L.P., a Delaware limited partnership and a subsidiary of SWH (“SWH Partnership”), SWH merged with and into REIT Merger Sub, with REIT Merger Sub surviving as our subsidiary (the “REIT Merger”). Immediately after the REIT Merger, SWH Partnership merged with and into INVH LP, with INVH LP surviving as our subsidiary (the “Partnership Merger,” and together with the REIT Merger, the “Mergers”). Under the terms of the Merger Agreement, each outstanding SWH common share was converted into 1.6140 shares of our common stock (the “Exchange Ratio”), and each outstanding unit of SWH Partnership was converted into 1.6140 common units, representing limited partner interests, in INVH LP. Further, each outstanding restricted share unit of SWH (an “SWH RSU”) that vested as a result of the Mergers was automatically converted into the right to receive our common stock based on the Exchange Ratio, plus any accrued but unpaid dividends (if any) and less certain taxes (if any). After giving effect to the Mergers, as of June 30, 2018, INVH owns a 98.3% partnership interest in INVH LP and has the full, exclusive and complete responsibility for and discretion over the day to day management and control of INVH LP. See Note 15 for additional information regarding the accounting treatment for the Mergers. The REIT Merger is intended to qualify as a reorganization for United States federal income tax purposes, and the Partnership Merger is intended to be treated as a transaction that is generally tax free to the holders of units of SWH Partnership for United States federal income tax purposes. |
Significant Accounting Policies |
6 Months Ended |
---|---|
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2—Significant Accounting Policies Basis of Presentation The accompanying interim condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017. Subsequent to the date of the Pre-IPO Transactions, these condensed consolidated financial statements include the accounts of INVH and its consolidated subsidiaries. Prior to the date of the Pre-IPO Transactions, these condensed consolidated financial statements include the combined accounts of INVH LP and the Invitation Homes Partnerships and their wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements. In the opinion of management, all adjustments that are of a normal recurring nature considered necessary for a fair presentation of our interim financial statements have been included in these condensed consolidated financial statements. Operating results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2018. We consolidate entities when we own, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity. We consolidate variable interest entities (“VIEs”) in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation, if we are the primary beneficiary of the VIE as determined by our power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. As described in Note 5, as a result of the Mergers we acquired an investment in a joint venture with the Federal National Mortgage Association (“FNMA”), which is a voting interest entity. We do not hold a controlling financial interest in the joint venture but have significant influence over its operating and financial policies. Additionally, FNMA held certain substantive participating rights that preclude the presumption of control by us; as such, we account for our investment using the equity method. In connection with the Mergers, we initially recorded this investment at fair value in connection with purchase accounting as described in Note 15 and have subsequently adjusted for our proportionate share of net earnings or losses and other comprehensive income or loss, cash contributions made and distributions received, and other adjustments, as appropriate. Distributions of operating profit from the joint venture are reported as part of operating cash flows while distributions related to a capital transaction, such as a refinancing transaction or sale, are reported as investing activities. Non-controlling interests primarily represent the interests in INVH LP held by a third party as a result of the Partnership Merger. Non-controlling interests are presented as a separate component of equity on the condensed consolidated balance sheets as of June 30, 2018 and December 31, 2017 and the condensed consolidated statements of operations for the three and six months ended June 30, 2018 includes an allocation of the net loss attributable to the non-controlling interest holders. Adoption of New Accounting Standards In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which provides guidance on revenue recognition and supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, most industry-specific guidance, and some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. The standard’s core principle is that a company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. These judgments may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. We adopted ASU 2014-09 effective January 1, 2018 using the modified retrospective transition method. This adoption did not have a significant impact on our condensed consolidated financial statements, as more than 90% of our total revenues consist of rental income from leasing arrangements, and such revenue is specifically excluded from the standard. We analyzed our remaining revenue streams included within other property income and concluded there was no change to the timing and pattern of revenue recognition for these revenue streams under the new guidance. As such, adoption of the standard did not result in a change to our revenue recognition policies, require recognition of a cumulative adjustment as of January 1, 2018, or have a material impact on our condensed consolidated financial statements. In September 2017, the FASB issued ASU No. 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments. The purpose of this pronouncement is to update the guidance in the SEC paragraphs of the ASC to align with ASU No. 2014-09. We adopted ASU 2017-03 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting, which clarifies the definition of modification with the objective of evaluating whether modification accounting should be applied when there are changes to the terms or conditions of a share-based payment award. We adopted ASU 2017-09 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In February 2017, the FASB issued ASU 2017-05, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets. The new guidance clarifies that ASC 610-20 applies to the derecognition of nonfinancial assets and in substance nonfinancial assets unless other specific guidance applies. As a result, it will not apply to the derecognition of businesses, nonprofit activities, or financial assets (including equity method investments), or to revenue transactions (contracts with customers). The new guidance also clarifies that an in substance nonfinancial asset is an asset or group of assets for which substantially all of the fair value consists of nonfinancial assets and the group or subsidiary is not a business. In addition, transfers of nonfinancial assets to another entity in exchange for a non-controlling ownership interest in that entity will be accounted for under ASC 610-20, removing specific guidance on such partial exchanges from ASC 845, Nonmonetary Transactions. As a result of the new guidance, the guidance specific to real estate sales in ASC 360-20, Real Estate Sales, will be eliminated. As such, sales and partial sales of real estate assets will now be subject to the same derecognition model as all other nonfinancial assets. We adopted ASU 2017-05 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, to simplify the accounting for goodwill impairment by removing step two of the goodwill impairment test, which had involved determining the fair value of individual assets and liabilities of a reporting unit to measure goodwill. Instead, goodwill impairment will be determined as the excess of a reporting unit’s carrying value over its fair value, not to exceed the carrying amount of goodwill. We adopted ASU 2017-04 effective January 1, 2018, which will impact our goodwill impairment testing process; however, it did not have a material impact on our condensed consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires that period changes in the total of cash, cash equivalents, and amounts generally described as restricted cash or cash equivalents are explained in the statement of cash flows. Thus, amounts generally described as restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning and ending balances shown in the statement of cash flows. We adopted ASU 2016-18 effective January 1, 2018, using a retrospective transition method. As a result, on our condensed consolidated statements of cash flow, changes in restricted cash related to security deposits (previously included in the operating activities section) and changes in the restricted cash line (previously included in the investing activities section) have been eliminated. Changes in restricted cash are now included in the beginning of period and end of period total cash, cash equivalents and restricted cash amounts. Additionally, Note 4 includes expanded disclosures regarding the components of the beginning and ending balances on our condensed consolidated statements of cash flows. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. This new guidance will require the current and deferred tax effects of intercompany transactions, except for those involving inventory, to be recognized currently. Under current GAAP, the tax effects of intra-entity asset transfers are deferred until the transferred asset is sold to a third party or otherwise recovered through use. We adopted ASU 2016-16 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which clarifies the classification of certain cash receipts and cash payments including debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, proceeds from the settlement of insurance claims, and beneficial interests in securitization transactions. We adopted ASU 2016-15 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments, including the requirement to measure certain equity investments at fair value with changes in fair value recognized in net income. We adopted ASU 2016-01 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. These estimates are inherently subjective in nature and actual results could differ from those estimates. Accounting Policies There have been no changes to our significant accounting policies that have had a material impact on our condensed consolidated financial statements and related notes, compared to those policies disclosed in our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017. Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes how companies will measure credit losses for certain financial assets. This guidance requires an entity to estimate its expected credit loss and record an allowance based on this estimate so that it is presented at the net amount expected to be collected on the financial asset. This new standard will be effective for annual reporting periods beginning after December 15, 2019, and interim periods within that reporting period, with early adoption permitted beginning after December 15, 2018 and interim periods within that reporting period. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which will require lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than one year. Lessor accounting will remain similar to lessor accounting under current GAAP, while aligning with the FASB’s new revenue recognition guidance. The new standard will be effective for us for annual reporting periods beginning after December 15, 2018, and for interim periods within those annual periods, with early adoption permitted. We expect that the adoption of this standard will result in an increase in assets and liabilities on our condensed consolidated balance sheets related to our leased office space and vehicles. |
Investments in Single-Family Residential Properties |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in Single-Family Residential Properties | Note 3—Investments in Single-Family Residential Properties The following table sets forth the net carrying amount associated with our properties by component:
As of June 30, 2018 and December 31, 2017, the carrying amount of the residential properties above includes $122,080 and $125,903, respectively, of capitalized acquisition costs (excluding purchase price), along with $65,203 and $62,938, respectively, of capitalized interest, $26,060 and $25,966, respectively, of capitalized property taxes, $4,739 and $4,727, respectively, of capitalized insurance, and $2,795 and $2,818, respectively, of capitalized homeowners’ association (“HOA”) fees. During the three months ended June 30, 2018 and 2017, we recognized $128,501 and $66,699, respectively, of depreciation expense related to the components of the properties, $16,446 and $0, respectively, of amortization related to in-place lease intangible assets, and $1,503 and $816, respectively, of depreciation and amortization related to corporate furniture and equipment. These amounts are included in depreciation and amortization in the condensed consolidated statements of operations. Further, during the three months ended June 30, 2018 and 2017, impairments totaling $1,671 and $95, respectively, have been recognized and are included in impairment and other in the condensed consolidated statements of operations. During the six months ended June 30, 2018 and 2017, we recognized $255,162 and $133,352, respectively, of depreciation expense related to the components of the properties, $32,893 and $0, respectively, of amortization related to in-place lease intangible assets, and $2,895 and $1,740, respectively, of depreciation and amortization related to corporate furniture and equipment. These amounts are included in depreciation and amortization in the condensed consolidated statements of operations. Further, during the six months ended June 30, 2018 and 2017, impairments totaling $2,274 and $1,132, respectively, have been recognized and are included in impairment and other in the condensed consolidated statements of operations. |
Cash, Cash Equivalents, and Restricted Cash |
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Cash and Cash Equivalents [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash, Cash Equivalents, and Restricted Cash | Note 4—Cash, Cash Equivalents, and Restricted Cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the condensed consolidated balance sheets that sum to the total of such amounts shown in the condensed consolidated statements of cash flows:
Pursuant to the terms of the mortgage loans described in Note 6, we are required to establish, maintain, and fund from time to time (generally either monthly or at the time borrowings are funded) certain specified reserve accounts. These reserve accounts include, but are not limited to, the following types of accounts: (i) property tax reserves; (ii) insurance reserves; (iii) capital expenditure reserves; and (iv) HOA reserves. The reserve accounts associated with the mortgage loans are under the sole control of the loan servicer. Additionally, we hold security deposits pursuant to resident lease agreements that are required to be segregated. Until April 3, 2018, we were required to post collateral related to certain of our interest rate swap agreements, and we hold letters of credit as required by certain of our insurance policies. Accordingly, amounts funded to these reserve accounts, security deposit accounts, and other restricted accounts have been classified on our condensed consolidated balance sheets as restricted cash. The amounts funded, and to be funded, to the reserve accounts are subject to formulae included in the mortgage loan agreements and are to be released to us subject to certain conditions specified in the mortgage loan agreements being met. To the extent that an event of default were to occur, the loan servicer has discretion to use such funds to either settle the applicable operating expenses to which such reserves relate or reduce the allocated loan amount associated with a residential property of ours. The balances of our restricted cash accounts, as of June 30, 2018 and December 31, 2017, are set forth in the table below. As of June 30, 2018 and December 31, 2017, no amounts were funded to the insurance accounts as the conditions specified in the mortgage loan agreements that require such funding did not exist.
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Other Assets | Note 5—Other Assets As of June 30, 2018 and December 31, 2017, the balances in other assets, net are as follows:
Investments in Debt Securities, net As of June 30, 2018, in connection with certain of our Securitizations (as defined in Note 6), we have retained and purchased certificates totaling $483,381, net of unamortized discounts of $3,169. These investments in debt securities are classified as held to maturity investments. As of June 30, 2018 and December 31, 2017, there were no gross unrecognized holding gains or losses, and there were no other than temporary impairments recognized in accumulated other comprehensive income. As of June 30, 2018, our retained certificates are scheduled to mature over the next one month to nine years. On July 19, 2018, we received $71,770 of repayment proceeds from retained IH 2015-3 debt certificates as a result of the repayment of the related outstanding mortgage loan balance on June 28, 2018. See Note 6. Investment in Unconsolidated Joint Venture In connection with the Mergers, we acquired a 10% interest in a joint venture with FNMA to operate, lease, and manage a portfolio of properties primarily located in Arizona, California, and Nevada. A wholly-owned subsidiary of INVH LP is the managing member of the joint venture and is responsible for the operation and management of the properties, subject to FNMA’s approval on major decisions. As of June 30, 2018 and December 31, 2017, the joint venture owned 758 and 776 properties, respectively. Rent and Other Receivables, net We lease our properties to residents pursuant to leases that generally have an initial contractual term of at least 12 months, provide for monthly payments, and are cancelable by the resident and us under certain conditions specified in the related lease agreements. Included in other assets, net on the condensed consolidated balance sheets, is an allowance for doubtful accounts of $2,237 and $4,094, as of June 30, 2018 and December 31, 2017, respectively. In-Place Leases, net In connection with the Mergers, we acquired in-place leases with a fair value of $45,740. The amortization period assigned at the Merger Date was approximately eight months, which represents the weighted average remaining lease period, and amortization expense of $16,446 and $32,893 is included in depreciation and amortization expense in the condensed consolidated statements of operations for the three and six months ended June 30, 2018, respectively. As of June 30, 2018 and December 31, 2017, the unamortized balances of the in-place lease intangible asset are $4,624 and $37,517, respectively, and the balance will be fully amortized during the year ended December 31, 2018. Deferred Financing Costs, net In connection with our Revolving Facility (as defined in Note 6), we incurred $9,673 of financing costs during the year ended December 31, 2017, which have been deferred as other assets, net on our condensed consolidated balance sheet due to the line of credit features of the Revolving Facility. These deferred financing costs are being amortized as interest expense on a straight line basis over the term of the Revolving Facility. As of June 30, 2018 and December 31, 2017, the unamortized balances of these deferred financing costs are $6,319 and $7,504, respectively. |
Debt |
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Debt | Note 6—Debt Mortgage Loans Our securitization transactions (the “Securitizations” or the “mortgage loans”) are collateralized by certain homes owned by the respective Borrower Entities. We utilize the proceeds from our securitizations to fund (i) repayments of then-outstanding indebtedness, (ii) initial deposits into Securitization reserve accounts, (iii) closing costs in connection with the mortgage loans, (iv) general costs associated with our operations, and (v) distributions and dividends. In addition to the Securitization transactions we initiated, we assumed certain mortgage loans from SWH in connection with the Mergers. The following table sets forth a summary of our mortgage loan indebtedness as of June 30, 2018 and December 31, 2017:
Securitization Transactions For each Securitization transaction, the Borrower Entity executed a loan agreement with a third‑party lender. Except for IH 2017-1, each mortgage loan consists of five to seven components. The components are floating rate except with respect to certain components we were required to retain in connection with risk retention rules. The two to three year initial terms are individually subject to two to five, one-year extension options at the Borrower Entity’s discretion. Such extensions are available provided there is no continuing event of default under the respective mortgage loan agreement and the Borrower Entity obtains a replacement interest rate cap agreement in a form reasonably acceptable to the lender. IH 2017-1 is a 10-year, fixed rate mortgage loan comprised of two components. Certificates issued by the trust in connection with Component A of IH 2017-1 benefit from FNMA’s guaranty of timely payment of principal and interest. Certain components were sold at a discount, and $3,169 and $3,345 of unamortized discount are included in mortgage loans, net on our condensed consolidated balance sheets as of June 30, 2018 and December 31, 2017, respectively. Each mortgage loan is secured by a pledge of the equity in the assets of the respective Borrower Entities, as well as first-priority mortgages on the underlying properties and a grant of security interests in all of the related personal property. As of June 30, 2018 and December 31, 2017, a total of 43,825 and 47,616 homes, respectively, were pledged pursuant to the mortgage loans. We are obligated to make monthly payments of interest for each mortgage loan, and IH 2013-1 and CAH 2014-1 also required monthly payments of principal. Transactions with Trusts Concurrent with the execution of each mortgage loan agreement, the respective third-party lender sold each loan it originated to individual depositor entities (the “Depositor Entities”) who subsequently transferred each loan to Securitization-specific trust entities (the “Trusts”). The Depositor Entities for our Securitizations currently outstanding are wholly-owned subsidiaries. We accounted for the transfer of the individual Securitizations from the wholly-owned Depositor Entities to the respective Trusts as sales under ASC Topic 860, Transfers and Servicing, with no resulting gain or loss as the Securitizations were both originated by the lender and immediately transferred at the same fair market value. As consideration for the transfer of each loan to the Trusts, the Trusts issued certificate classes which mirror the components of the individual loan agreements (collectively, the “Certificates”) to the Depositor Entities, except that Class R certificates do not have related loan components as they represent residual interests in the Trusts. The Certificates represent the entire beneficial interest in the Trusts. Following receipt of the Certificates, the Depositor Entities sold the Certificates to investors using the proceeds as consideration for the loans sold to the Depositor Entities by the lenders. These transactions had no effect on our condensed consolidated financial statements other than with respect to Certificates we retained in connection with Securitizations or purchased at a later date. The Trusts are structured as pass-through entities that receive interest, and in the case of IH 2013-1 and CAH 2014-1 principal payments, from the Securitizations and distribute those payments to the holders of the Certificates. The assets held by the Trusts are restricted and can only be used to fulfill the obligations of those entities. The obligations of the Trusts do not have any recourse to the general credit of any entities in these condensed consolidated financial statements. We have evaluated our interests in certain certificates of the Trusts held by us (discussed below) and determined that they do not create a more than insignificant variable interest in the Trusts. Additionally, the retained certificates do not provide us with any ability to direct the activities that could impact the Trusts’ economic performance. Therefore, we do not consolidate the Trusts. Retained Certificates Beginning in April 2014, the Trusts made Certificates available for sale to both domestic and foreign investors. With the introduction of foreign investment, sponsors of the mortgage loans are required to retain a portion of the risk that represents a material net economic interest in each loan. These requirements were further refined in December 2016 pursuant to Regulation RR (the “Risk Retention Rules”) under the Securities Exchange Act of 1934, as amended. As such, loan sponsors are now required to retain a portion of the credit risk that represents not less than 5% of the aggregate fair value of the loan as of the closing date. To fulfill these requirements, Class G certificates for IH 2015-1, IH 2015-2, IH 2015-3, CAH 2015-1, CSH 2016-1, and CSH 2016-2 are issued in an amount equal to 5% of the original principal amount of the loans. Per the terms of the mortgage loan agreements, the Class G certificates are restricted certificates that were made available exclusively to the sponsor, as applicable. We retained these Class G certificates during the time the related Securitizations are outstanding, and they are principal only, bearing a stated interest rate of 0.0005%. Additionally, in certain instances, we have elected to purchase certain Class F certificates, which bear a stated annual interest rate of LIBOR plus a spread ranging from 3.73% to 5.08%. For IH 2017-1, the Class B certificates are restricted certificates that were made available exclusively to INVH LP in order to comply with the Risk Retention Rules. The Class B certificates bear a stated annual interest rate of 4.23%, including applicable servicing fees. For SWH 2017-1, IH 2017-2, IH 2018-1, IH 2018-2, and IH 2018-3, we retained a portion of each certificate class to meet the Risk Retention Rules. These retained certificates accrue interest at a floating rate of LIBOR plus a spread ranging from 0.76% to 3.47%. The retained certificates total $483,381 and $378,545 as of June 30, 2018 and December 31, 2017, respectively, are classified as held to maturity investments, and are recorded in other assets, net on the condensed consolidated balance sheets (see Note 5). On July 19, 2018, we received $71,770 of repayment proceeds from retained IH 2015-3 debt certificates as a result of the repayment of the related outstanding mortgage loan balance on June 28, 2018. Loan Covenants The general terms that apply to all of the mortgage loans require us to maintain compliance with certain affirmative and negative covenants. Affirmative covenants with which we must comply include our, and certain of our affiliates’, compliance with (i) licensing, permitting and legal requirements specified in the mortgage loan agreements, (ii) organizational requirements of the jurisdictions in which we, and certain of our affiliates, are organized, (iii) federal and state tax laws, and (iv) books and records requirements specified in the respective mortgage loan agreements. Negative covenants with which we must comply include our, and certain of our affiliates’, compliance with limitations surrounding (i) the amount of our indebtedness and the nature of our investments, (ii) the execution of transactions with affiliates, (iii) the Manager, and (iv) the nature of our business activities. As of June 30, 2018, and through the date our condensed consolidated financial statements were issued, we believe we are in compliance with all affirmative and negative covenants. Prepayments For the mortgage loans, prepayments of amounts owed by us are generally not permitted by us under the terms of the respective mortgage loan agreements unless such prepayments are made pursuant to the voluntary election or mandatory provisions specified in such agreements. The specified mandatory provisions become effective to the extent that a property becomes characterized as a disqualified property, a property is sold, and/or upon the occurrence of a condemnation or casualty event associated with a property. To the extent either a voluntary election is made, or a mandatory prepayment condition exists, in addition to paying all interest and principal, we must also pay certain breakage costs as determined by the loan servicer and a spread maintenance premium if prepayment occurs before the month following the one or two year anniversary of the closing dates of each of the mortgage loans except for IH 2017-1. For IH 2017-1, prepayments on or before December 2026 will require a yield maintenance premium. For the six months ended June 30, 2018 and 2017, we made voluntary and mandatory prepayments of $3,198,588 and $2,083,012, respectively, under the terms of the mortgage loan agreements. Term Loan Facility and Revolving Facility On February 6, 2017, we entered into a credit agreement with a syndicate of banks, financial institutions and institutional lenders for a credit facility (the “Credit Facility”), which was amended on December 18, 2017 to include entities and homes acquired in the Mergers. The Credit Facility provides $2,500,000 of borrowing capacity and consists of a $1,000,000 revolving facility (the “Revolving Facility”), which will mature on February 6, 2021, with a one-year extension option, and a $1,500,000 term loan facility (the “Term Loan Facility”), which will mature on February 6, 2022. The Revolving Facility also includes borrowing capacity available for letters of credit and for short-term borrowings referred to as swing line borrowings, in each case subject to certain sublimits. The Credit Facility provides us with the option to enter into additional incremental credit facilities (including an uncommitted incremental facility that provides us with the option to increase the size of the Revolving Facility and/or the Term Loan Facility by an aggregate amount of up to $1,500,000), subject to certain limitations. Proceeds from the Term Loan Facility were used to repay existing indebtedness and for general corporate purposes. Proceeds from the Revolving Facility were used for general corporate purposes. The following table sets forth a summary of the outstanding principal amounts under the Credit Facility as of June 30, 2018 and December 31, 2017:
Interest Rate and Fees Borrowings under the Credit Facility bear interest, at our option, at a rate equal to a margin over either (a) a LIBOR rate determined by reference to the Bloomberg LIBOR rate (or comparable or successor rate) for the interest period relevant to such borrowing, or (b) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 0.50%, and (3) the LIBOR rate that would be payable on such day for a LIBOR rate loan with a one-month interest period plus 1.00%. The margin is based on a total leverage based grid. The margin for the Revolving Facility ranges from 0.75% to 1.30%, in the case of base rate loans, and 1.75% to 2.30%, in the case of LIBOR rate loans. The margin for the Term Loan Facility ranges from 0.70% to 1.30%, in the case of base rate loans, and 1.70% to 2.30%, in the case of LIBOR rate loans. In addition, the Credit Facility provides that, upon receiving an investment grade rating on its non-credit enhanced, senior unsecured long term debt of BBB- or better from Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc., or Baa3 or better from Moody’s Investors Service, Inc. (an “Investment Grade Rating Event”), we may elect to convert to a credit rating based pricing grid. In addition to paying interest on outstanding principal under the Credit Facility, we are required to pay a facility fee to the lenders under the Revolving Facility in respect of the unused commitments thereunder. The facility fee rate is based on the daily unused amount of the Revolving Facility and is either 0.35% or 0.20% per annum based on the unused facility amount. Upon converting to a credit rating pricing based grid, the unused facility fee will no longer apply; and we will be required to pay a facility fee ranging from 0.125% to 0.300%. We are also required to pay customary letter of credit fees. Prepayments and Amortization No principal reductions are required under the Credit Facility. We are permitted to voluntarily repay amounts outstanding under the Term Loan Facility at any time without premium or penalty, subject to certain minimum amounts and the payment of customary “breakage” costs with respect to LIBOR loans. Once repaid, no further borrowings will be permitted under the Term Loan Facility. Loan Covenants The Credit Facility contains certain customary affirmative and negative covenants and events of default. Such covenants will, among other things, restrict, subject to certain exceptions, our ability and that of the Subsidiary Guarantors (as defined below) and their respective subsidiaries to (i) engage in certain mergers, consolidations or liquidations, (ii) sell, lease or transfer all or substantially all of their respective assets, (iii) engage in certain transactions with affiliates, (iv) make changes to our fiscal year, (v) make changes in the nature of our business and our subsidiaries, and (vi) incur additional indebtedness that is secured on a pari passu basis with the Credit Facility. The Credit Facility also requires us, on a consolidated basis with our subsidiaries, to maintain a (i) maximum total leverage ratio, (ii) maximum secured leverage ratio, (iii) maximum unencumbered leverage ratio, (iv) minimum fixed charge coverage ratio, (v) minimum unencumbered fixed charge coverage ratio, and (vi) minimum tangible net worth. If an event of default occurs, the lenders under the Credit Facility are entitled to take various actions, including the acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor. As of June 30, 2018, and through the date our condensed consolidated financial statements were issued, we believe we were in compliance with all affirmative and negative covenants. Guarantees and Security The obligations under the Credit Facility are guaranteed on a joint and several basis by each of our direct and indirect domestic wholly-owned subsidiaries that own, directly or indirectly, unencumbered assets (the “Subsidiary Guarantors”), subject to certain exceptions. The guarantee provided by any Subsidiary Guarantor will be automatically released upon the occurrence of certain events, including if it no longer has a direct or indirect interest in an unencumbered asset or as a result of certain non-recourse refinancing transactions pursuant to which such Subsidiary Guarantor becomes contractually prohibited from providing its guaranty of the Credit Facility. In addition, INVH may be required to provide a guarantee of the Credit Facility under certain circumstances, including if INVH does not maintain its qualification as a real estate investment trust (“REIT”). The Credit Facility is collateralized by first priority or equivalent security interests in all the capital stock of, or other equity interests in, any Subsidiary Guarantor held by us and each of the Subsidiary Guarantors. The security interests granted under the Credit Facility will be automatically released upon the occurrence of certain events, including upon an Investment Grade Rating Event or if the total net leverage ratio is less than or equal to 8.00:1.00 for four consecutive fiscal quarters. Convertible Senior Notes In connection with the Mergers, we assumed SWH’s convertible senior notes. In July 2014, SWH issued $230,000 in aggregate principal amount of 3.00% convertible senior notes due 2019 (the “2019 Convertible Notes”). Interest on the 2019 Convertible Notes is payable semiannually in arrears on January 1st and July 1st of each year. The 2019 Convertible Notes will mature on July 1, 2019. In January 2017, SWH issued $345,000 in aggregate principal amount of 3.50% convertible senior notes due 2022 (the “2022 Convertible Notes” and together with the 2019 Convertible Notes, the “Convertible Senior Notes”). Interest on the 2022 Convertible Notes is payable semiannually in arrears on January 15th and July 15th of each year. The 2022 Convertible Notes will mature on January 15, 2022. The following table summarizes the terms of the Convertible Senior Notes outstanding as of June 30, 2018 and December 31, 2017:
Terms of Conversion As of June 30, 2018, the conversion rate applicable to the 2019 Convertible Notes is 53.0969 shares of our common stock per $1,000 principal amount (actual $) of the 2019 Convertible Notes (equivalent to a conversion price of approximately $18.83 per common share – actual $). The conversion rate for the 2019 Convertible Notes is subject to adjustment in some events, but will not be adjusted for any accrued and unpaid interest. In addition, following certain events that occur prior to the maturity date, we will increase the conversion rate for a holder who elects to convert its 2019 Convertible Notes in connection with such an event in certain circumstances. At any time prior to January 1, 2019, holders may convert the 2019 Convertible Notes at their option only under specific circumstances as defined in the indenture agreement, dated as of July 7, 2014, between us and our trustee, Wilmington Trust, National Association (“the Convertible Notes Trustee”). As a result of the completion of the Mergers, the 2019 Convertible Notes were convertible for a 35 trading day period, which expired January 8, 2018. On or after January 1, 2019 and until maturity, holders may convert all or any portion of the 2019 Convertible Notes at any time. Upon conversion, we will pay or deliver, as the case may be, cash, common stock, or a combination of cash and common stock, at our election. As of June 30, 2018, the conversion rate applicable to the 2022 Convertible Notes is 43.7694 shares of our common stock per $1,000 principal amount (actual $) of the 2022 Convertible Notes (equivalent to a conversion price of approximately $22.85 per common share – actual $). The conversion rate for the 2022 Convertible Notes is subject to adjustment in some events, but will not be adjusted for any accrued and unpaid interest. In addition, following certain events that occur prior to the maturity date, we will increase the conversion rate for a holder who elects to convert its 2022 Convertible Notes in connection with such an event in certain circumstances. At any time prior to July 15, 2021, holders may convert the 2022 Convertible Notes at their option only under specific circumstances as defined in the indenture agreement, dated as of January 10, 2017, between us and the Convertible Notes Trustee. As a result of the completion of the Mergers, the 2022 Convertible Notes were convertible for a 35 trading day period, which expired January 8, 2018. On or after July 15, 2021 and until maturity, holders may convert all or any portion of the 2022 Convertible Notes at any time. Upon conversion, we will pay or deliver, as the case may be, cash, common stock, or a combination of cash and common stock, at our election. General Terms We may not redeem the Convertible Senior Notes prior to their maturity dates except to the extent necessary to preserve our status as a REIT for United States federal income tax purposes, as further described in the indentures. If we undergo a fundamental change as defined in the indentures, holders may require us to repurchase for cash all or any portion of their Convertible Senior Notes at a fundamental change repurchase price equal to 100% of the principal amount of the Convertible Senior Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The indentures contain customary terms and covenants and events of default. If an event of default occurs and is continuing, the Convertible Notes Trustee, by notice to us, or the holders of at least 25% in aggregate principal amount of the outstanding Convertible Senior Notes, by notice to us and the Convertible Notes Trustee, may, and the Convertible Notes Trustee at the request of such holders shall, declare 100% of the principal of and accrued and unpaid interest on all the Convertible Senior Notes to be due and payable. In the case of an event of default arising out of certain events of bankruptcy, insolvency or reorganization in respect to us (as set forth in the indentures), 100% of the principal of and accrued and unpaid interest on the Convertible Senior Notes will automatically become due and payable. Debt Maturities Schedule The following table summarizes the contractual maturities of our debt as of June 30, 2018:
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | Note 7—Derivative Instruments From time to time, we enter into derivative instruments to manage the economic risk of changes in interest rates. We do not enter into derivative transactions for speculative or trading purposes. Designated hedges are derivatives that meet the criteria for hedge accounting and for which we have elected to designate them as hedges. Non-designated hedges are derivatives that do not meet the criteria for hedge accounting or which we did not elect to designate as accounting hedges. Designated Hedges We have entered into various interest rate swap agreements, which are used to hedge the variable cash flows associated with variable-rate interest payments. Certain of the Invitation Homes Partnerships and certain Borrower Entities guaranteed the obligations under each of the interest rate swaps from the date the swaps were entered into through the date of the IPO. Each of these swaps was accounted for as a non-designated hedge until January 31, 2017, when the criteria for hedge accounting were met as a result of the Pre-IPO Transactions described in Note 1. At that time, we designated these swaps for hedge accounting purposes. Subsequent to that date, changes in the fair value of these swaps are recorded in other comprehensive income and are subsequently reclassified into earnings in the period in which the hedged forecasted transactions affect earnings. In addition, in connection with the Mergers, we acquired various interest rate swap instruments, which we designated for hedge accounting purposes. On the Merger Date, we recorded these interest rate swaps at their aggregate estimated fair value of $21,135 (see Note 15). Over the terms of each swap, an amount equal to the Merger Date fair value will be amortized and recorded as an increase in interest expense and accumulated other comprehensive income. The table below summarizes our interest rate swap instruments as of June 30, 2018:
During the three and six months ended June 30, 2018, such derivatives were used to hedge the variable cash flows associated with existing variable-rate interest payments. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the next 12 months, we estimate that $37,388 will be reclassified to earnings as a decrease in interest expense. Non-Designated Hedges Concurrent with entering into certain of the mortgage loan agreements and in connection with the Mergers, we entered into or acquired and maintain interest rate cap agreements with terms and notional amounts equivalent to the terms and amounts of the mortgage loans made by the third-party lenders and with strike prices ranging from approximately 2.83% to 4.43% (collectively, the “Strike Prices”). To the extent that the maturity date of one or more of the mortgage loans is extended through an exercise of one or more of the extension options, replacement or extension interest rate cap agreements must be executed with terms similar to those associated with the initial interest rate cap agreements and strike prices equal to the greater of the Strike Prices and the interest rate at which the debt service coverage ratio (as defined) is not less than 1.2 to 1.0. The interest rate cap agreements, including all of our rights to payments owed by the counterparties and all other rights, have been pledged as additional collateral for the mortgage loans. Additionally, in certain instances, in order to minimize the cash impact of purchasing required interest rate caps, we simultaneously sold interest rate caps (which have identical terms and notional amounts) such that the purchase price and sale proceeds of the related interest rate caps are intended to offset each other. Tabular Disclosure of Fair Values of Derivative Instruments on the Condensed Consolidated Balance Sheets The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of June 30, 2018 and December 31, 2017:
Offsetting Derivatives The Company enters into master netting arrangements, which reduce risk by permitting net settlement of transactions with the same counterparty. The table below presents a gross presentation, the effects of offsetting, and a net presentation of the Company’s derivatives as of June 30, 2018. As of December 31, 2017, there were no derivatives classified as liabilities.
Tabular Disclosure of the Effect of Derivative Instruments on the Condensed Consolidated Statements of Operations The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of operations for the three months ended June 30, 2018 and 2017:
The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of operations for the six months ended June 30, 2018 and 2017:
Credit-Risk-Related Contingent Features We have agreements with certain of our derivative counterparties for our interest rate swap agreements that contain a provision where we could be declared in default on our derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to our default on the indebtedness. As of June 30, 2018, the fair value of certain derivatives in a net liability position, including accrued interest but adjusted for nonperformance risk, related to these agreements was $3,245. If we have breached any of these provisions at June 30, 2018, we could have been required to settle the obligations under the agreements at their termination value of $3,245. As of December 31, 2017, we had posted collateral amounting to $15,120 related to certain of these agreements (see Note 4). As of June 30, 2018, no collateral deposits were required related for our interest rate swap agreements. |
Equity |
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Equity | Note 8—Equity Shareholders’ Equity In connection with our IPO (see Note 1), we issued 310,376,634 shares of common stock to the public and the Pre-IPO Owners and 3,290,126 restricted stock units (“RSUs”) (see Note 10), and our IPO raised $1,692,058, net of underwriting discount, and before IPO costs of $5,726. During the six months ended June 30, 2018, we issued 1,320,227 shares of common stock, comprised of 915,190 shares of common stock in net settlement of 1,251,958 fully vested RSUs and 405,037 shares of common stock in exchange for the redemption of the same number of units of partnership interests in INVH LP (the “OP Units”). Starwood Waypoint Homes Merger In connection with the Mergers (see Note 1), SWH stockholders received an aggregate of 207,448,958 shares of our common stock in exchange for all outstanding SWH common shares. In addition, we issued 9,441,615 OP Units which are redeemable for shares of our common stock on a one-for-one basis or, in our sole discretion, cash and are reflected as non-controlling interests on our condensed consolidated balance sheets. As of June 30, 2018, 9,036,578 redeemable OP Units remain outstanding. Dividends To qualify as a REIT, we are required to distribute annually to our stockholders at least 90% of our REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and to pay tax at regular corporate rates to the extent that we annually distribute less than 100% of our net taxable income. We intend to pay quarterly dividends to our stockholders, which in the aggregate are approximately equal to or exceed our net taxable income in the relevant year. The following table summarizes our dividends declared from January 1, 2017 through June 30, 2018:
On August 2, 2018, our board of directors declared a dividend of $0.11 per share to stockholders of record on August 16, 2018, which is payable on August 31, 2018. Combined Equity Prior to the IPO, our business was conducted through the Invitation Homes Partnerships which did not have a common capital structure. As described in Note 1, IH1, IH3, IH4, IH5, and IH6 are partnerships. These entities each had limited partners and a general partner (the “Class A Partners”), along with a board of directors designated in the respective limited partnership agreements. IH2 was a Delaware corporation and had issued 1,000 shares of common stock and 113 shares of Series A Preferred Stock. IH2 had a board of directors elected by the common stockholders. The same board of directors was responsible for directing the significant activities of the Invitation Homes Partnerships and INVH LP on a combined basis. The IH2 Series A Preferred Stock ranked, in respect of rights to the payment of dividends and the distribution of assets in the event of any liquidation or dissolution, senior to the IH2 common stock. Holders of such IH2 Series A Preferred Stock shares were entitled to receive cumulative cash dividends at the rate of 12.0% per annum of the total of a liquidation preference. On January 31, 2017, in connection with the Pre-IPO Transactions, the Series A Preferred Stock was redeemed for $1,153, inclusive of the redemption premium and accrued and unpaid dividends to that date. Profits and losses, and cash distributions were allocated in accordance with the terms of the respective entity’s organizational documents. As further described in Note 10, we granted certain individuals incentive compensation units in IH1, IH2, IH3, IH4, IH5, and IH6 (the “Class B Units”) that were accounted for as a substantive class of equity due to the terms of the agreements and rights of the holders. We previously made distributions to certain Class B unitholders in the form of non-recourse cash advances totaling $11,023. Any amounts distributed to the holders of the Class B Units whose Class B Units were converted in connection with the Pre-IPO Transactions (see Note 10), reduced the number of converted shares common stock received by amounts previously paid to such Class B unitholders as advance distributions. As a result of the Pre-IPO Transactions, there are no longer any Class B Units outstanding. We previously executed and funded notes receivables with certain Class B unitholders (the “Class B Notes”). On January 5, 2017, $7,723 of Class B Notes, including accrued interest, were canceled, and the transaction was accounted for as a distribution to the underlying unitholder. As part of the Pre-IPO Transactions, IH1 assigned $11,963, including accrued interest, of Class B Notes to a wholly-owned subsidiary of the Pre-IPO Owners that was formed in connection with the reorganization described in Note 1, and the transaction was accounted for as a distribution. The Class B Notes were secured by certain of the Class B Units of the makers of the Class B Notes and were otherwise non-recourse to the makers. As such, the Class B Notes were recorded as a component of combined equity on our condensed consolidated balance sheet prior to the transactions described above. |
Related Party Transactions |
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Related Party Transactions [Abstract] | |
Related Party Transactions | Note 9—Related Party Transactions Management Services One of our wholly-owned subsidiaries, as the managing member of a joint venture with FNMA (see Note 5), earns a management fee based upon the venture’s gross receipts. For the three and six months ended June 30, 2018, we earned $692 and $1,399, respectively, of management fees which are included in other, net in the accompanying condensed consolidated statements of operations. There were no such management fees earned during the three and six months ended June 30, 2017. |
Share-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Compensation | Note 10—Share-Based Compensation INVH RSAs and RSUs Prior to completion of the IPO, our board of directors adopted, and our stockholders approved, the Invitation Homes Inc. 2017 Omnibus Incentive Plan (the “Omnibus Incentive Plan”) to provide a means through which to attract and retain key personnel and to provide a means whereby our directors, officers, employees, consultants and advisors can acquire and maintain an equity interest in us, or be paid incentive compensation, including incentive compensation measured by reference to the value of our common stock, and to align their interests with those of our stockholders. Under the Omnibus Incentive Plan, we may issue up to 16,000,000 shares, and as of June 30, 2018, we have awarded 5,617,345 RSUs thereunder. Time-vesting RSUs are participating securities for earnings per share (“EPS”) purposes, and performance or market based vesting RSUs are not. We refer to RSUs with performance or market based vesting conditions as “PRSUs.” Additionally, in connection with the IPO, we granted 62,529 restricted shares of common stock of INVH (“RSAs”) in conversion of the Class B Units. These RSAs are all time-vesting awards, and they are not part of the Omnibus Incentive Plan. For detailed discussion of RSUs and RSAs issued prior to January 1, 2018, refer to our Annual Report on Form 10-K for the year ended December 31, 2017.
The PRSUs may be earned based on the achievement of certain measures over a three-year performance period. The number of PRSUs earned will be determined based on performance achieved during the performance period for each measure at certain threshold, target, or maximum levels and corresponding payout ranges. In general, the LTIP PRSUs are earned on the date after the end of the performance period on which the performance results are certified (a “Certification Date”) by our compensation and management development committee (the “Compensation Committee”). The 2018 LTIP PRSUs are eligible to vest on the related Certification Date subject to continued employment through such date. All of the LTIP Awards are subject to certain change in control and retirement eligibility provisions that may impact these vesting schedules.
During the six months ended June 30, 2018, the grant date was established for 168,184 PRSUs issued in connection with the Mergers. These Merger-related PRSUs may be earned based on the achievement of certain measures over a three-year performance period that began on the Merger Date. The number of Merger-related PRSUs earned will be determined based on performance achieved during the performance period for each measure at certain threshold, target, or maximum levels and corresponding payout ranges. In general, the Merger-related LTIP PRSUs are earned and will vest on the related Certification Date subject to continued employment through such date. During the six months ended June 30, 2018, certain PRSUs vested and achieved performance in excess of the target level, resulting in the issuance of an additional 39,871 shares of common stock. Such awards are reflected as an increase in the number of awards granted and vested in the table below. The following table summarizes the status of non-vested time-vesting RSUs (including RSAs) and PRSUs as of June 30, 2018 and changes during the six months ended June 30, 2018:
During the six months ended June 30, 2018, 1,105,717 time-vesting RSUs and 113,862 PRSUs with an estimated fair value of $27,221 fully vested. As of June 30, 2018, there were 920,537 PRSUs outstanding. The grant-date fair values of the RSAs, time-vesting RSUs, and PRSUs with performance condition vesting criteria are generally based on the closing price of our common stock on the grant date. However, for the awards granted in connection with the IPO, the grant-date fair value is the opening offering price per common share, and the grant-date fair values for PRSUs with market condition vesting criteria are based on Monte-Carlo option pricing models. The following table summarizes the significant inputs utilized in these models at the grant date for awards issued during the six months ended June 30, 2018:
Summary of Total Share-Based Compensation Expense During the three months ended June 30, 2018 and 2017, we recognized $8,016, and $8,216 respectively, of share-based compensation expense. During the six months ended June 30, 2018 and 2017, we recognized $17,514, and $52,460 respectively, of share-based compensation expense, comprised of the following:
As of June 30, 2018, there is $32,999 of unrecognized share-based compensation expense related to non-vested RSUs which is expected to be recognized over a weighted average period of 1.85 years. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Note 11—Fair Value Measurements The carrying amounts of restricted cash, certain components of other assets, accounts payable and accrued expenses, resident security deposits, and other liabilities approximate fair value due to the short maturity of these amounts. Our interest rate swap agreements and interest rate cap agreements are the only financial instruments recorded at fair value on a recurring basis within our condensed consolidated financial statements. The fair values of our interest rate caps and swaps, which are classified as Level 2 in the fair value hierarchy, are estimated using market values of instruments with similar attributes and maturities. See Note 7 for the details of the balance sheet classification and the fair values for the interest rate caps and swaps. The following table displays the carrying values and fair values of financial instruments as of June 30, 2018 and December 31, 2017:
The fair values of our investment in debt securities and mortgage loans, which are classified as Level 2 in the fair value hierarchy, are estimated based on market bid prices of comparable instruments at the end of the period. The fair values of our Term Loan Facility and Revolving Facility, which are classified as Level 3 in the fair value hierarchy, are estimated using a discounted cash flow methodology based on market interest rate data and other market factors available at the end of the period. Fair value of convertible notes are estimated by discounting contractual cash flows at the interest rate we estimate the notes would bear if sold in the current market. Our assets measured at fair value on a nonrecurring basis are those assets for which we have recorded impairments. The assets for which we have recorded impairments, measured at fair value on a nonrecurring basis, are summarized below:
For additional information related to our single-family residential properties during the three and six months ended June 30, 2018 and 2017, refer to Note 3. |
Earnings per Share |
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Earnings per Share | Note 12—Earnings per Share We compute EPS only for the period after February 1, 2017, the date on which our common stock began trading on the New York Stock Exchange. Basic EPS is computed by dividing the net income (loss) available to common shareholders for the period during which common stock was outstanding by the weighted average number of shares outstanding during such period, adjusted for non-vested shares of RSUs and RSAs. Diluted EPS is similar to computing basic EPS, except that the denominator is increased to include the dilutive effects of non-vested RSUs and RSAs, except when doing so would be anti-dilutive. All outstanding non-vested RSUs and RSAs that have nonforfeitable rights to dividends or dividend equivalents that participate in undistributed earnings with common stock are considered participating securities and are included in the computation of EPS pursuant to the two-class method. The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings in periods when we have net income. Certain of our non-vested RSUs and RSAs, as identified in Note 10, are considered participating securities, as are our redeemable INVH LP units. Basic and diluted EPS are calculated as follows:
Incremental shares attributed to non-vested RSUs and RSAs are excluded from the computation of diluted EPS for the periods in which we had a net loss as their inclusion would reduce our net loss per share and would be anti-dilutive. The number of incremental shares excluded is (i) 1,129,465 during the three months ended June 30, 2018, (ii) 1,242,853 for the six months ended June 30, 2018, and (iii) 445,595 for the period from February 1, 2017 through June 30, 2017. No incremental shares attributed to non-vested RSUs and RSAs are excluded for the three months ended June 30, 2017 as we had net income for the period. For the three and six months ended June 30, 2018, the redeemable INVH LP units have been excluded from the computation of EPS because all loss attributable to the INVH LP units has been recorded as non-controlling interest and thus excluded from net loss available to common shareholders. For the three and six months ended June 30, 2018, the potential shares of common stock contingently issuable upon the conversion of the Convertible Senior Notes are also excluded from the computation of diluted EPS as we have the intent and ability to settle the obligations in cash. |
Income Tax |
6 Months Ended |
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Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Note 13—Income Tax We account for income taxes under the asset and liability method. For the taxable REIT subsidiaries (“TRSs”), deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. We provide a valuation allowance, from time to time, for deferred tax assets for which we do not consider realization of such assets to be more likely than not. As of June 30, 2018 and December 31, 2017, we have no deferred tax assets and liabilities or unrecognized tax benefits recorded. We do not anticipate a significant change in unrecognized tax benefits within the next 12 months. We have sold assets that were either subject to Section 337(d) of the Code (see additional discussion in Note 2) or were held by TRSs. These transactions resulted in $455 and $853 of current income tax expense for the three months ended June 30, 2018 and 2017, respectively, and $849 and $1,987 for the six months ended June 30, 2018 and 2017, respectively, which has been recorded in gain on sale of property, net of tax in the condensed consolidated statements of operations. |
Commitments and Contingencies |
6 Months Ended |
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Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 14—Commitments and Contingencies Insurance Policies Pursuant to the terms of our Credit Facility and the mortgage loan agreements (see Note 6), laws and regulations of the jurisdictions in which our properties are located, and general business practices, we are required to procure insurance on our properties. For the three and six months ended June 30, 2018 and 2017, no material uninsured losses have been incurred with respect to our properties except as described below. Hurricane-Related Charges During the third quarter of 2017, hurricanes Harvey and Irma damaged certain of our properties in Texas and the Southeast United States. As of June 30, 2018, we have recorded $10,768 of receivables for the portion of the damages we believe will be recoverable through our property and casualty insurance policies which provide coverage for wind and flood damage, as well as business interruption costs during the period of remediation and repairs, subject to specified deductibles and limits. Additionally, as of June 30, 2018, the accounts payable and accrued expenses balance on our condensed consolidated balance sheet includes an estimated $1,273 of unrepaired damages caused by the hurricanes. Legal Matters We are subject to various legal proceedings and claims that arise in the ordinary course of our business. We accrue a liability when we believe that it is both probable that a liability has been incurred and that we can reasonably estimate the amount of the loss. We do not believe that the final outcome of these proceeding or matters will have a material adverse effect on our condensed consolidated financial statements. Other Matters SEC Investigation “In the Matter of Certain Single Family Rental Securitizations” Radian Group Inc. (“Radian”), the indirect parent company of Green River Capital LLC (“GRC”), which is a service provider that provides certain broker price opinions (“BPO”) to the Company, disclosed in its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2017 that GRC had received a letter in March 2017 from the staff of the SEC stating that it is conducting an investigation captioned “In the Matter of Certain Single Family Rental Securitizations” and requesting information from market participants. Radian disclosed that the letter asked GRC to provide information regarding BPOs that GRC provided on properties included in single family rental securitization transactions. In September 2017, we received a letter from the staff of the SEC stating that it is conducting an investigation captioned “In the Matter of Certain Single Family Rental Securitizations.” The letter enclosed a subpoena that requests the production of certain documents and communications related to our Securitizations, including, without limitation, those related to BPOs provided on our properties included in our Securitizations. The SEC letter indicates that its investigation is a fact-finding inquiry and does not mean that the SEC has a negative opinion of any person or security. We are cooperating with the SEC and have provided information requested in the subpoena. We understand that other transaction parties in securitizations have received requests in this matter. As the SEC’s investigation is ongoing, we cannot currently predict the timing, outcome or scope of such investigation. Severance and Retention In June 2017, our board of directors, upon recommendation of our Compensation Committee, approved and adopted our Invitation Homes Inc. Executive Severance Plan, as amended (the “Executive Severance Plan”); and, in September 2017, adopted severance guidelines for those not covered by the Executive Severance Plan (the “Severance Guidelines” and, together with the Executive Severance Plan, the “Severance Plans”). The Severance Plans provide all qualified employees specified benefits following such person’s qualifying termination of employment. |
Business Combinations |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations | Note 15—Business Combinations On November 16, 2017, we completed the Mergers with SWH. We believe that the Mergers provide a number of significant potential strategic benefits and opportunities that will be in the best interests of our stockholders. More specifically, we believe that the Mergers created a diversified and high-quality portfolio of homes in high-growth markets. Potential benefits from economies of scale and the market overlap of INVH’s and SWH’s complementary portfolios may be derived from optimization of operations, reduction of operating costs, and other anticipated synergies. The Mergers were accounted for as a business combination in accordance with ASC Topic 805, Business Combinations. INVH was designated as the accounting acquirer. The assets (including identifiable intangible assets) and liabilities (including executory contracts and other commitments) of SWH were recorded at their respective fair values at the Merger Date. The estimated fair value of the consideration transferred was $4,920,534, which was based upon (i) the observable public closing share price of $23.01 on November 15, 2017 for the 207,448,958 shares of INVH common stock issued to SWH stockholders in exchange for their SWH common shares, (ii) the equity component of the Convertible Senior Notes, which was valued at $135,520, and (iii) the recognition of $11,614 of precombination service related to the exchange of SWH RSUs for INVH RSUs. Subsequent to the Merger Date, our condensed consolidated financial statements reflect these fair value adjustments and include the combined results of operations. Because INVH was designated as the accounting acquirer, our historical financial statements for periods prior to November 16, 2017 represent only the historical financial information of INVH and its consolidated subsidiaries. Purchase Price Allocation The total purchase price has been allocated based upon (1) the amounts reported in the SWH historical financial statements for any assets that were reported at fair value in accordance with SWH’s historical accounting policies or (2) management’s estimates of fair value. Management’s preliminary estimates of fair value for SWH’s investments in real estate properties were based upon a progressive method that incorporated three value sources: automated valuation model data, BPOs and internal desktop valuations (Level 3 measurements). The fair value of our investment in the unconsolidated joint venture represents the estimated fair value of our equity interest in the joint venture with FNMA. We determined the fair value based on the estimated fair value of the underlying investments in single-family residential properties after giving consideration to the terms and conditions of the related joint venture agreement (Level 3 measurement). The fair value of other assets includes the estimated fair value of in-place leases in the amount of $45,740, which was estimated based on lost rent and avoidable costs over an assumed vacancy period (Level 3 measurements). Also included in other assets is the estimated fair value of interest rate swap agreements in the aggregate amount of $21,135. The fair value of SWH’s debt was determined by comparison of contractual terms of SWH’s existing debt obligations to the current market rates on a risk-adjusted basis as of the Merger Date. The associated future debt cash flows were then discounted back to present value to arrive at an estimated fair value of SWH’s debt (Level 3 measurements). The allocation of the total purchase price to SWH’s tangible and intangible assets and liabilities under this methodology is as follows:
These allocations are management’s estimates of fair value, which are preliminary as of June 30, 2018 and are subject to change. The goodwill recorded is primarily attributable to the value of the synergies expected to arise after the Mergers. Merger and Transaction-Related Expenses We incurred $4,236 and $8,603 of merger and transaction-related expenses related to the Mergers during the three and six months ended June 30, 2018, included in general and administrative expenses in the condensed consolidated statements of operations. Merger and transaction-related expenses are expensed as incurred and are comprised primarily of transaction fees and direct acquisition costs, including legal, finance, consulting, professional fees, and other third-party costs. The costs that were obligations of SWH and expensed by SWH prior to the Merger Date are not included in our condensed consolidated financial statements. In addition, and in connection with the Mergers and the resulting integration, we have incurred severance costs for terminated and transitional employees, and such costs are accrued over the related remaining service periods. More specifically, in August 2017, we entered into agreements with several of our executives, which provide the executives, as applicable, with benefits upon the consummation of the Mergers and/or where the executive experiences a qualifying termination within a specified period of time following such consummation. After the consummation of the Mergers, if a participant under either a Severance Plan or an executive agreement experiences a qualifying termination, such person will be entitled to specified benefits. During the three and six months ended June 30, 2018, we incurred $1,681 and $4,340, respectively, of employee severance pursuant to the Severance Plans and the executive agreements, and these costs are included in general and administrative expenses in the condensed consolidated statements of operations. Pro Forma Information The following table provides the pro forma consolidated operational data as if the Mergers had occurred on January 1, 2017 (unaudited):
Pro forma net loss includes transaction costs related to the Mergers of $4,236 and $58,575 for the three and six months ended June 30, 2017, respectively. The pro forma consolidated operational data is based on assumptions and estimates considered appropriate by our management; however, these pro forma results are not necessarily indicative of the results of operations that would have been obtained had the Mergers occurred at the beginning of the period presented, nor do they purport to represent the consolidated results of operations for future periods. The pro forma consolidated operational data does not include the impact of any synergies that may be achieved from the Mergers or any strategies that management may consider in order to continue to efficiently manage operations. |
Subsequent Events |
6 Months Ended |
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Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 16—Subsequent Events In connection with the preparation of the accompanying condensed consolidated financial statements, we have evaluated events and transactions occurring after June 30, 2018, for potential recognition or disclosure. Mortgage Loan Prepayments On July 9, 2018 we made a voluntary prepayment of $200,000 against the outstanding balance of CSH 2016-1 with proceeds from the IH 2018-3 securitization transaction and available cash. Dividend Declaration On August 2, 2018, our board of directors declared a dividend of $0.11 per share to stockholders of record on August 16, 2018, which is payable on August 31, 2018. |
Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017. Subsequent to the date of the Pre-IPO Transactions, these condensed consolidated financial statements include the accounts of INVH and its consolidated subsidiaries. Prior to the date of the Pre-IPO Transactions, these condensed consolidated financial statements include the combined accounts of INVH LP and the Invitation Homes Partnerships and their wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements. In the opinion of management, all adjustments that are of a normal recurring nature considered necessary for a fair presentation of our interim financial statements have been included in these condensed consolidated financial statements. Operating results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2018. We consolidate entities when we own, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity. We consolidate variable interest entities (“VIEs”) in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation, if we are the primary beneficiary of the VIE as determined by our power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. As described in Note 5, as a result of the Mergers we acquired an investment in a joint venture with the Federal National Mortgage Association (“FNMA”), which is a voting interest entity. We do not hold a controlling financial interest in the joint venture but have significant influence over its operating and financial policies. Additionally, FNMA held certain substantive participating rights that preclude the presumption of control by us; as such, we account for our investment using the equity method. In connection with the Mergers, we initially recorded this investment at fair value in connection with purchase accounting as described in Note 15 and have subsequently adjusted for our proportionate share of net earnings or losses and other comprehensive income or loss, cash contributions made and distributions received, and other adjustments, as appropriate. Distributions of operating profit from the joint venture are reported as part of operating cash flows while distributions related to a capital transaction, such as a refinancing transaction or sale, are reported as investing activities. Non-controlling interests primarily represent the interests in INVH LP held by a third party as a result of the Partnership Merger. Non-controlling interests are presented as a separate component of equity on the condensed consolidated balance sheets as of June 30, 2018 and December 31, 2017 and the condensed consolidated statements of operations for the three and six months ended June 30, 2018 includes an allocation of the net loss attributable to the non-controlling interest holders. |
Adoption of New Accounting Standards and Recent Accounting Pronouncements | Adoption of New Accounting Standards In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which provides guidance on revenue recognition and supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, most industry-specific guidance, and some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. The standard’s core principle is that a company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. These judgments may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. We adopted ASU 2014-09 effective January 1, 2018 using the modified retrospective transition method. This adoption did not have a significant impact on our condensed consolidated financial statements, as more than 90% of our total revenues consist of rental income from leasing arrangements, and such revenue is specifically excluded from the standard. We analyzed our remaining revenue streams included within other property income and concluded there was no change to the timing and pattern of revenue recognition for these revenue streams under the new guidance. As such, adoption of the standard did not result in a change to our revenue recognition policies, require recognition of a cumulative adjustment as of January 1, 2018, or have a material impact on our condensed consolidated financial statements. In September 2017, the FASB issued ASU No. 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments. The purpose of this pronouncement is to update the guidance in the SEC paragraphs of the ASC to align with ASU No. 2014-09. We adopted ASU 2017-03 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting, which clarifies the definition of modification with the objective of evaluating whether modification accounting should be applied when there are changes to the terms or conditions of a share-based payment award. We adopted ASU 2017-09 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In February 2017, the FASB issued ASU 2017-05, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets. The new guidance clarifies that ASC 610-20 applies to the derecognition of nonfinancial assets and in substance nonfinancial assets unless other specific guidance applies. As a result, it will not apply to the derecognition of businesses, nonprofit activities, or financial assets (including equity method investments), or to revenue transactions (contracts with customers). The new guidance also clarifies that an in substance nonfinancial asset is an asset or group of assets for which substantially all of the fair value consists of nonfinancial assets and the group or subsidiary is not a business. In addition, transfers of nonfinancial assets to another entity in exchange for a non-controlling ownership interest in that entity will be accounted for under ASC 610-20, removing specific guidance on such partial exchanges from ASC 845, Nonmonetary Transactions. As a result of the new guidance, the guidance specific to real estate sales in ASC 360-20, Real Estate Sales, will be eliminated. As such, sales and partial sales of real estate assets will now be subject to the same derecognition model as all other nonfinancial assets. We adopted ASU 2017-05 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, to simplify the accounting for goodwill impairment by removing step two of the goodwill impairment test, which had involved determining the fair value of individual assets and liabilities of a reporting unit to measure goodwill. Instead, goodwill impairment will be determined as the excess of a reporting unit’s carrying value over its fair value, not to exceed the carrying amount of goodwill. We adopted ASU 2017-04 effective January 1, 2018, which will impact our goodwill impairment testing process; however, it did not have a material impact on our condensed consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires that period changes in the total of cash, cash equivalents, and amounts generally described as restricted cash or cash equivalents are explained in the statement of cash flows. Thus, amounts generally described as restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning and ending balances shown in the statement of cash flows. We adopted ASU 2016-18 effective January 1, 2018, using a retrospective transition method. As a result, on our condensed consolidated statements of cash flow, changes in restricted cash related to security deposits (previously included in the operating activities section) and changes in the restricted cash line (previously included in the investing activities section) have been eliminated. Changes in restricted cash are now included in the beginning of period and end of period total cash, cash equivalents and restricted cash amounts. Additionally, Note 4 includes expanded disclosures regarding the components of the beginning and ending balances on our condensed consolidated statements of cash flows. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. This new guidance will require the current and deferred tax effects of intercompany transactions, except for those involving inventory, to be recognized currently. Under current GAAP, the tax effects of intra-entity asset transfers are deferred until the transferred asset is sold to a third party or otherwise recovered through use. We adopted ASU 2016-16 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which clarifies the classification of certain cash receipts and cash payments including debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, proceeds from the settlement of insurance claims, and beneficial interests in securitization transactions. We adopted ASU 2016-15 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments, including the requirement to measure certain equity investments at fair value with changes in fair value recognized in net income. We adopted ASU 2016-01 effective January 1, 2018, and it did not have a material impact on our condensed consolidated financial statements. Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes how companies will measure credit losses for certain financial assets. This guidance requires an entity to estimate its expected credit loss and record an allowance based on this estimate so that it is presented at the net amount expected to be collected on the financial asset. This new standard will be effective for annual reporting periods beginning after December 15, 2019, and interim periods within that reporting period, with early adoption permitted beginning after December 15, 2018 and interim periods within that reporting period. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which will require lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than one year. Lessor accounting will remain similar to lessor accounting under current GAAP, while aligning with the FASB’s new revenue recognition guidance. The new standard will be effective for us for annual reporting periods beginning after December 15, 2018, and for interim periods within those annual periods, with early adoption permitted. We expect that the adoption of this standard will result in an increase in assets and liabilities on our condensed consolidated balance sheets related to our leased office space and vehicles. |
Use of Estimates | Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. These estimates are inherently subjective in nature and actual results could differ from those estimates. |
Investments in Single-Family Residential Properties (Tables) |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of property carrying amount | The following table sets forth the net carrying amount associated with our properties by component:
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Cash, Cash Equivalents, and Restricted Cash (Tables) |
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Cash and Cash Equivalents [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of cash and cash equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the condensed consolidated balance sheets that sum to the total of such amounts shown in the condensed consolidated statements of cash flows:
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Schedule of restricted cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the condensed consolidated balance sheets that sum to the total of such amounts shown in the condensed consolidated statements of cash flows:
The balances of our restricted cash accounts, as of June 30, 2018 and December 31, 2017, are set forth in the table below. As of June 30, 2018 and December 31, 2017, no amounts were funded to the insurance accounts as the conditions specified in the mortgage loan agreements that require such funding did not exist.
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Other Assets (Tables) |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of other assets | As of June 30, 2018 and December 31, 2017, the balances in other assets, net are as follows:
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Debt (Tables) |
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Schedule of long-term debt instruments | The following table sets forth a summary of our mortgage loan indebtedness as of June 30, 2018 and December 31, 2017:
The following table summarizes the terms of the Convertible Senior Notes outstanding as of June 30, 2018 and December 31, 2017:
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Schedule of line of credit facility | The following table sets forth a summary of the outstanding principal amounts under the Credit Facility as of June 30, 2018 and December 31, 2017:
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Schedule of maturities of long-term debt | The following table summarizes the contractual maturities of our debt as of June 30, 2018:
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Derivative Instruments (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of interest rate swap instruments | The table below summarizes our interest rate swap instruments as of June 30, 2018:
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Summary of derivative financial instruments, fair value and location in condensed consolidated balance sheets | The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of June 30, 2018 and December 31, 2017:
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Summary of offsetting derivative assets | The table below presents a gross presentation, the effects of offsetting, and a net presentation of the Company’s derivatives as of June 30, 2018. As of December 31, 2017, there were no derivatives classified as liabilities.
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Summary of offsetting derivative liabilities | The table below presents a gross presentation, the effects of offsetting, and a net presentation of the Company’s derivatives as of June 30, 2018. As of December 31, 2017, there were no derivatives classified as liabilities.
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Summary of effect of derivative financial instruments on condensed consolidated statements of operations - derivative instruments not-designated as hedging instruments | The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of operations for the three months ended June 30, 2018 and 2017:
The tables below present the effect of our derivative financial instruments in the condensed consolidated statements of operations for the six months ended June 30, 2018 and 2017:
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Equity (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of dividends declared | The following table summarizes our dividends declared from January 1, 2017 through June 30, 2018:
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Share-Based Compensation (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of share-based compensation, restricted stock and restricted stock units | The following table summarizes the status of non-vested time-vesting RSUs (including RSAs) and PRSUs as of June 30, 2018 and changes during the six months ended June 30, 2018:
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Schedule of share-based payment awards, stock options, valuation assumption | The following table summarizes the significant inputs utilized in these models at the grant date for awards issued during the six months ended June 30, 2018:
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Schedule of compensation cost for share-based payment arrangements, allocation of share-based compensation costs by plan | During the three months ended June 30, 2018 and 2017, we recognized $8,016, and $8,216 respectively, of share-based compensation expense. During the six months ended June 30, 2018 and 2017, we recognized $17,514, and $52,460 respectively, of share-based compensation expense, comprised of the following:
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Fair Value Measurements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of carrying values and fair values of financial instruments | The following table displays the carrying values and fair values of financial instruments as of June 30, 2018 and December 31, 2017:
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Schedule of impaired assets, measured at fair value on a nonrecurring basis | The assets for which we have recorded impairments, measured at fair value on a nonrecurring basis, are summarized below:
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Earnings per Share (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and diluted earnings per share calculation | Basic and diluted EPS are calculated as follows:
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Business Combinations (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of allocation of the total purchase price | The allocation of the total purchase price to SWH’s tangible and intangible assets and liabilities under this methodology is as follows:
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Pro forma consolidated operational data | The following table provides the pro forma consolidated operational data as if the Mergers had occurred on January 1, 2017 (unaudited):
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Significant Accounting Policies (Details) |
6 Months Ended |
---|---|
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Percent of revenue excluded from ASU 2014-09 (more than) | 90.00% |
Investments in Single-Family Residential Properties - Net Carrying Amount of Properties (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Real Estate [Abstract] | ||
Land | $ 4,635,181 | $ 4,646,917 |
Single-family residential property | 13,151,873 | 13,084,156 |
Capital improvements | 536,264 | 536,297 |
Equipment | 120,114 | 120,528 |
Total gross investments in the properties | 18,443,432 | 18,387,898 |
Less: accumulated depreciation | (1,321,346) | (1,075,634) |
Investments in single-family residential properties, net | $ 17,122,086 | $ 17,312,264 |
Investments in Single-Family Residential Properties - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Property, Plant and Equipment [Line Items] | |||||
Capitalized acquisition costs, net | $ 122,080 | $ 122,080 | $ 125,903 | ||
Accumulated capitalized interest costs | 65,203 | 65,203 | 62,938 | ||
Capitalized property taxes, net | 26,060 | 26,060 | 25,966 | ||
Capitalized insurance, net | 4,739 | 4,739 | 4,727 | ||
Capitalized HOA Fees, net | 2,795 | 2,795 | $ 2,818 | ||
Depreciation | 128,501 | $ 66,699 | 255,162 | $ 133,352 | |
Depreciation and amortization | 146,450 | 67,515 | 290,950 | 135,092 | |
Provisions for impairment | 1,671 | 95 | 2,274 | 1,132 | |
Furniture and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation and amortization | 1,503 | 816 | 2,895 | 1,740 | |
In-place lease intangible assets | |||||
Property, Plant and Equipment [Line Items] | |||||
Amortization of intangible assets | $ 16,446 | $ 0 | $ 32,893 | $ 0 |
Cash, Cash Equivalents, and Restricted Cash - Reconciliation to Statements of Cash Flows (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|---|---|
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 166,874 | $ 179,878 | $ 158,934 | $ 198,119 |
Restricted cash | 243,048 | 236,684 | 138,264 | 222,092 |
Total cash, cash equivalents, and restricted cash shown in the condensed consolidated statements of cash flows | $ 409,922 | $ 416,562 | $ 297,198 | $ 420,211 |
Other Assets - Schedule of Other Assets (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Investments in debt securities, net | $ 483,381 | $ 378,545 |
Derivative instruments (Note 7) | 137,238 | 57,612 |
Held for sale assets | 69,238 | 46,814 |
Investment in unconsolidated joint venture | 56,823 | 57,078 |
Prepaid expenses | 38,108 | 37,869 |
Rent and other receivables, net | 26,388 | 24,525 |
Corporate fixed assets, net | 17,980 | 16,595 |
Deferred leasing costs, net | 6,499 | 7,018 |
Deferred financing costs, net | 6,319 | 7,504 |
In-place leases, net | 4,624 | 37,517 |
Amounts deposited and held by others | 4,619 | 12,598 |
Other | 23,930 | 12,930 |
Total | $ 875,147 | $ 696,605 |
Debt - Schedule of Convertible Senior Notes (Details) |
6 Months Ended | ||||
---|---|---|---|---|---|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2018
USD ($)
|
Dec. 31, 2017
USD ($)
|
Jan. 31, 2017
USD ($)
|
Jul. 31, 2014
USD ($)
|
|
Convertible Notes Payable [Abstract] | |||||
Principal Amount | $ 574,993,000 | $ 574,993,000 | $ 575,000,000 | ||
Net unamortized fair value adjustment | (22,132,000) | (22,132,000) | (26,464,000) | ||
Total | 552,861,000 | 552,861,000 | 548,536,000 | ||
Debt instrument, principal amount used for conversion | $ 1,000 | $ 1,000 | |||
2019 Convertible Notes | 3.00% Convertible Senior Note | |||||
Convertible Notes Payable [Abstract] | |||||
Coupon Rate | 3.00% | 3.00% | 3.00% | ||
Effective Rate | 4.92% | 4.92% | |||
Conversion Rate | 0.0530969 | 53.0969 | |||
Remaining Amortization Period | 1 year | ||||
Principal Amount | $ 229,993,000 | $ 229,993,000 | 230,000,000 | $ 230,000,000 | |
Convertible debt, fair value disclosures | $ 223,185,000 | ||||
2022 Convertible Notes | 3.50% Convertible Senior Note | |||||
Convertible Notes Payable [Abstract] | |||||
Coupon Rate | 3.50% | 3.50% | 3.50% | ||
Effective Rate | 5.12% | 5.12% | |||
Conversion Rate | 0.0437694 | 43.7694 | |||
Remaining Amortization Period | 3 years 6 months 17 days | ||||
Principal Amount | $ 345,000,000 | $ 345,000,000 | $ 345,000,000 | $ 345,000,000 | |
Convertible debt, fair value disclosures | $ 324,252,000 |
Derivative Instruments - Narrative (Details) |
Jun. 30, 2018
USD ($)
|
Dec. 31, 2017
USD ($)
|
Nov. 16, 2017
USD ($)
|
---|---|---|---|
Derivative [Line Items] | |||
Interest rate cash flow hedge gain (loss) to be reclassified during next 12 months | $ 37,388,000 | ||
Not Designated as Hedging Instrument | Minimum | |||
Derivative [Line Items] | |||
Interest rate cap | 2.83% | ||
Not Designated as Hedging Instrument | Maximum | |||
Derivative [Line Items] | |||
Interest rate cap | 4.43% | ||
Interest rate swaps | |||
Derivative [Line Items] | |||
Derivative, net liability position, fair value | $ 3,245,000 | ||
Amount required to settle obligations upon breach of provisions | 3,245,000 | ||
Posted collateral | $ 0 | $ 15,120,000 | |
Interest rate swaps | Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Fair value of swaps acquired in merger | $ 21,135,000 | ||
Interest rate caps | Not Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Debt service coverage ratio | 1.2 |
Derivative Instruments - Offsetting of Derivatives (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Offsetting assets: | ||
Gross Amounts of Recognized Assets | $ 137,238 | |
Gross Amounts Offset in the Statement of Financial Position | 0 | |
Net Amounts of Assets presented in the Statement of Financial Position | 137,238 | $ 57,612 |
Gross Amounts not Offset in the Statement of Financial Position, Financial Instruments | (10,260) | |
Gross Amounts not Offset in the Statement of Financial Position, Cash Collateral Received | 0 | |
Net Amount | 126,978 | |
Offsetting liabilities: | ||
Gross Amounts of Recognized Liabilities | 12,503 | |
Gross Amounts Offset in the Statement of Financial Position | 0 | |
Net Amounts of Liabilities presented in the Statement of Financial Position | 12,503 | |
Gross Amounts not Offset in the Statement of Financial Position, Financial Instruments | (10,260) | |
Gross Amounts not Offset in the Statement of Financial Position, Cash Collateral Received | 0 | |
Net Amount | $ 2,243 |
Equity - Summary of Dividends Declared (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | 17 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
May 31, 2018 |
May 15, 2018 |
Feb. 28, 2018 |
Feb. 13, 2018 |
Nov. 07, 2017 |
Oct. 24, 2017 |
Aug. 31, 2017 |
Aug. 15, 2017 |
May 31, 2017 |
May 15, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2018 |
|
Equity [Abstract] | ||||||||||||||
Common stock, dividends per share paid (in dollars per share) | $ 0.11 | $ 0.11 | $ 0.08 | $ 0.08 | $ 0.06 | |||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ 0.11 | $ 0.11 | $ 0.08 | $ 0.08 | $ 0.06 | $ 0.11 | $ 0.06 | $ 0.22 | $ 0.06 | |||||
Dividends, total amount paid | $ 57,559 | $ 57,432 | $ 25,139 | $ 25,200 | $ 18,800 |
Related Party Transactions (Details) - USD ($) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Related Party Transactions [Abstract] | ||||
Management fees earned | $ 692,000 | $ 0 | $ 1,399,000 | $ 0 |
Share-Based Compensation - Fair Value Inputs (Details) |
Mar. 01, 2018 |
---|---|
Fair Value Assumptions | |
Expected volatility, minimum | 14.50% |
Expected volatility, maximum | 17.30% |
Risk-free rate | 2.38% |
Minimum | |
Fair Value Assumptions | |
Expected holding period (years) | 2 years 8 months 15 days |
Maximum | |
Fair Value Assumptions | |
Expected holding period (years) | 2 years 10 months 2 days |
Fair Value Measurements - Impaired Assets, Measured at Fair Value on a Nonrecurring Basis (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Investments in single-family residential properties, net held for use and held for sale impairment adjustments | ||||
Total impairments | $ (1,671) | $ (95) | $ (2,274) | $ (1,132) |
Fair Value, Measurements, Nonrecurring | Level 3 | Rental Properties | ||||
Investments in single-family residential properties, net held for use and held for sale impairment adjustments | ||||
Pre-impairment amount | 9,183 | 885 | 12,408 | 8,127 |
Total impairments | (1,495) | (95) | (2,098) | (865) |
Fair value | 7,688 | 790 | 10,310 | 7,262 |
Fair Value, Measurements, Nonrecurring | Level 3 | Rental Properties | ||||
Investments in single-family residential properties, net held for use and held for sale impairment adjustments | ||||
Pre-impairment amount | 764 | 0 | 764 | 496 |
Total impairments | (176) | 0 | (176) | (267) |
Fair value | $ 588 | $ 0 | $ 588 | $ 229 |
Income Tax (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Income Tax Disclosure [Abstract] | ||||
Income tax expense recognized in gain on sale of property, net of tax | $ 455 | $ 853 | $ 849 | $ 1,987 |
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Loss Contingencies [Line Items] | ||||
Material uninsured losses | $ 0 | $ 0 | $ 0 | $ 0 |
Loss from Catastrophes | ||||
Loss Contingencies [Line Items] | ||||
Insurance receivable due to hurricanes | 10,768 | 10,768 | ||
Estimated remaining damages caused by hurricanes | $ 1,273 | $ 1,273 |
Business Combinations - Narrative (Details) - Starwood Waypoint Homes - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Nov. 16, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Nov. 15, 2017 |
|
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 4,920,534 | |||||
Share price (in dollars per share) | $ 23.01 | |||||
Consideration made up of the equity component of Convertible Senior Notes | 135,520 | |||||
Consideration made up of precombination service related to exchange of RSUs | 11,614 | |||||
Merger and transaction related expenses | $ 4,236 | $ 8,603 | $ 58,575 | |||
Employee severance | $ 1,681 | $ 4,340 | ||||
Other assets | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of interest rate swaps obtained in merger | 21,135 | |||||
Other assets | In-place lease intangible assets | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of in-place leases obtained in merger | $ 45,740 | |||||
Common Stock | ||||||
Business Acquisition [Line Items] | ||||||
Shares issued as consideration (in shares) | 207,448,958 |
Business Combinations - Purchase Price Allocation (Details) - USD ($) $ in Thousands |
Nov. 16, 2017 |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|---|
Liabilities assumed: | |||
Goodwill | $ 258,207 | $ 258,207 | |
Starwood Waypoint Homes | |||
Business Acquisition [Line Items] | |||
Consideration transferred | $ 4,920,534 | ||
Assets acquired: | |||
Land | 1,920,400 | ||
Buildings and improvements | 6,487,505 | ||
Cash and cash equivalents | 84,952 | ||
Restricted cash | 118,556 | ||
Other assets | 389,449 | ||
Liabilities assumed: | |||
Mortgage loans, net | (3,433,506) | ||
Convertible senior notes, net | (547,437) | ||
Accounts payable and accrued expenses | (112,505) | ||
Resident security deposits | (56,895) | ||
Other liabilities | (36,311) | ||
Non-controlling interests | (151,881) | ||
Net assets acquired | 4,662,327 | ||
Goodwill | $ 258,207 |
Business Combinations - Pro Forma Information (Details) - Starwood Waypoint Homes - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |
---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Business Acquisition [Line Items] | |||
Total revenue | $ 394,796 | $ 782,518 | |
Net loss | (75,556) | (153,412) | |
Merger and transaction related expenses | $ 4,236 | $ 8,603 | $ 58,575 |
Subsequent Events - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | 17 Months Ended | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 02, 2018 |
Jul. 09, 2018 |
May 31, 2018 |
May 15, 2018 |
Feb. 28, 2018 |
Feb. 13, 2018 |
Nov. 07, 2017 |
Oct. 24, 2017 |
Aug. 31, 2017 |
Aug. 15, 2017 |
May 31, 2017 |
May 15, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
|
Subsequent Event [Line Items] | |||||||||||||||||
Payments on mortgage loans | $ 3,198,588 | $ 2,083,012 | |||||||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ 0.11 | $ 0.11 | $ 0.08 | $ 0.08 | $ 0.06 | $ 0.11 | $ 0.06 | $ 0.22 | $ 0.06 | ||||||||
Common stock, dividends per share (in dollars per share) | $ 0.11 | $ 0.11 | $ 0.08 | $ 0.08 | $ 0.06 | ||||||||||||
Mortgage Loans | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Payments on mortgage loans | $ 3,198,588 | $ 2,083,012 | |||||||||||||||
Subsequent Event | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ 0.11 | ||||||||||||||||
Subsequent Event | CSH 2016-1 | Mortgage Loans | |||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||
Payments on mortgage loans | $ 200,000 |
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