INVESTMENTS IN UNCONSOLIDATED ENTITIES

3 Months Ended

Mar. 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENTS IN UNCONSOLIDATED ENTITIES

NOTE 6—INVESTMENTS IN UNCONSOLIDATED ENTITIES

We report investments in unconsolidated entities over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. We are not required to consolidate these entities because our joint venture partners have significant participating rights, nor are these entities considered VIEs, as they are controlled by equity holders with sufficient capital. At March 31, 2018, we had 25% ownership interests in joint ventures that owned 31 properties, excluding properties under development. We account for our interests in real estate joint ventures, as well as our 34% interest in Atria, 34% interest in ESL and 9.9% interest in Ardent, which are included within other assets on our Consolidated Balance Sheets, under the equity method of accounting.

With the exception of our interests in Atria, ESL and Ardent, we provide various services to each unconsolidated entity in exchange for fees and reimbursements. Total management fees earned in connection with these entities were $1.7 million and $1.6 million for the three months ended March 31, 2018 and 2017, respectively, which is included in office building and other services revenue in our Consolidated Statements of Income.

During the three months ended March 31, 2018, we recognized an impairment of $35.7 million relating to the carrying costs of one of our equity investments in an unconsolidated real estate joint venture consisting principally of SNFs. During the three months ended March 31, 2018, our joint venture partner initiated a transaction with us and as a result, we intend to sell our interest in the joint venture. This sale is expected to occur in the second half of 2018. However, there can be no assurance whether, when or on what terms the sale will be completed.