NOTE 16—CONDENSED CONSOLIDATING INFORMATION

Ventas, Inc. has fully and unconditionally guaranteed the obligation to pay principal and interest with respect to the outstanding senior notes issued by our 100% owned subsidiary, Ventas Realty, including the senior notes that were jointly issued with Ventas Capital Corporation. Ventas Capital Corporation is a direct 100% owned subsidiary of Ventas Realty that has no assets or operations, but was formed in 2002 solely to facilitate offerings of senior notes by a limited partnership. None of our other subsidiaries (such subsidiaries, excluding Ventas Realty and Ventas Capital Corporation, the “Ventas Subsidiaries”) is obligated with respect to Ventas Realty’s outstanding senior notes. Certain of Ventas Realty’s outstanding senior notes reflected in our condensed consolidating information were issued jointly with Ventas Capital Corporation.

Ventas, Inc. has also fully and unconditionally guaranteed the obligation to pay principal and interest with respect to the outstanding senior notes issued by our 100% owned subsidiary, Ventas Canada Finance Limited. None of our other subsidiaries is obligated with respect to Ventas Canada Finance Limited’s outstanding senior notes, all of which were issued on a private placement basis in Canada.

In connection with the acquisition of Nationwide Health Properties, Inc. (“NHP”), our 100% owned subsidiary, Nationwide Health Properties, LLC (“NHP LLC”), as successor to NHP, assumed the obligation to pay principal and interest with respect to the outstanding senior notes issued by NHP. Neither we nor any of our subsidiaries (other than NHP LLC) is obligated with respect to any of NHP LLC’s outstanding senior notes.

Under certain circumstances, contractual and legal restrictions, including those contained in the instruments governing our subsidiaries’ outstanding mortgage indebtedness, may restrict our ability to obtain cash from our subsidiaries for the purpose of meeting our debt service obligations, including our payment guarantees with respect to Ventas Realty’s and Ventas Canada Finance Limited’s senior notes.

The following pages summarize our condensed consolidating information as of March 31, 2018 and December 31, 2017 and for the three months ended March 31, 2018 and 2017.

CONDENSED CONSOLIDATING BALANCE SHEET



	As of March 31, 2018
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries			Consolidated Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	3,708		$	118,075		$	21,530,261		$	—		$	21,652,044
Cash and cash equivalents	11,672			—			80,871			—			92,543
Escrow deposits and restricted cash	9,739			128			61,172			—			71,039
Investment in and advances to affiliates	14,893,299			2,800,078			—			(17,693,377		)	—
Goodwill	—			—			1,035,248			—			1,035,248
Assets held for sale	—			—			62,534			—			62,534
Other assets	61,262			6,560			512,280			—			580,102
Total assets	$	14,979,680		$	2,924,841		$	23,282,366		$	(17,693,377	)	$	23,493,510
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	—		$	8,596,937		$	2,442,875		$	—		$	11,039,812
Intercompany loans	7,389,404			(6,127,269		)	(1,262,135		)	—			—
Accrued interest	(6,886		)	65,964			18,686			—			77,764
Accounts payable and other liabilities	366,117			41,026			727,427			—			1,134,570
Liabilities related to assets held for sale	—			—			60,023			—			60,023
Deferred income taxes	244,742			—			—			—			244,742
Total liabilities	7,993,377			2,576,658			1,986,876			—			12,556,911
Redeemable OP Unitholder and noncontrolling interests	—			—			132,555			—			132,555
Total equity	6,986,303			348,183			21,162,935			(17,693,377		)	10,804,044
Total liabilities and equity	$	14,979,680		$	2,924,841		$	23,282,366		$	(17,693,377	)	$	23,493,510

CONDENSED CONSOLIDATING BALANCE SHEET



	As of December 31, 2017
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries			Consolidated Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	1,844		$	119,508		$	21,971,100		$	—		$	22,092,452
Cash and cash equivalents	9,828			—			71,527			—			81,355
Escrow deposits and restricted cash	39,816			128			66,954			—			106,898
Investment in and advances to affiliates	14,786,086			2,916,060			—			(17,702,146		)	—
Goodwill	—			—			1,034,644			—			1,034,644
Assets held for sale	—			—			65,413			—			65,413
Other assets	55,936			9,458			508,385			—			573,779
Total assets	$	14,893,510		$	3,045,154		$	23,718,023		$	(17,702,146	)	$	23,954,541
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	—		$	8,895,641		$	2,380,421		$	—		$	11,276,062
Intercompany loans	7,835,266			(7,127,624		)	(707,642		)	—			—
Accrued interest	(6,410		)	77,691			22,677			—			93,958
Accounts payable and other liabilities	381,512			24,635			777,342			—			1,183,489
Liabilities related to assets held for sale	—			—			60,265			—			60,265
Deferred income taxes	250,092			—			—			—			250,092
Total liabilities	8,460,460			1,870,343			2,533,063			—			12,863,866
Redeemable OP Unitholder and noncontrolling interests	—			—			158,490			—			158,490
Total equity	6,433,050			1,174,811			21,026,470			(17,702,146		)	10,932,185
Total liabilities and equity	$	14,893,510		$	3,045,154		$	23,718,023		$	(17,702,146	)	$	23,954,541

CONDENSED CONSOLIDATING STATEMENT OF INCOME



	For the Three Months Ended March 31, 2018
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries			Consolidated Elimination			Consolidated
	(In thousands)
Revenues
Rental income	$	601		$	34,386		$	349,822		$	—		$	384,809
Resident fees and services	—			—			514,753			—			514,753
Office building and other services revenue	—			—			3,328			—			3,328
Income from loans and investments	491			—			30,690			—			31,181
Equity earnings in affiliates	56,662			—			(1,000		)	(55,662		)	—
Interest and other income	9,323			—			311			—			9,634
Total revenues	67,077			34,386			897,904			(55,662		)	943,705
Expenses
Interest	(28,661		)	82,312			57,712			—			111,363
Depreciation and amortization	1,344			1,444			230,362			—			233,150
Property-level operating expenses	—			72			412,841			—			412,913
Office building services costs	—			—			115			—			115
General, administrative and professional fees	556			4,050			32,568			—			37,174
Loss on extinguishment of debt, net	—			10,977			—			—			10,977
Merger-related expenses and deal costs	16,246			—			1,090			—			17,336
Other	2,169			—			951			—			3,120
Total expenses	(8,346		)	98,855			735,639			—			826,148
Income (loss) before unconsolidated entities, income taxes, discontinued operations, real estate dispositions and noncontrolling interests	75,423			(64,469		)	162,265			(55,662		)	117,557
Loss from unconsolidated entities	—			(35,504		)	(5,235		)	—			(40,739		)
Income tax benefit	3,242			—			—			—			3,242
Income (loss) from continuing operations	78,665			(99,973		)	157,030			(55,662		)	80,060
Discontinued operations	(10		)	—			—			—			(10		)
Gain on real estate dispositions	48			—			—			—			48
Net income (loss)	78,703			(99,973		)	157,030			(55,662		)	80,098
Net income attributable to noncontrolling interests	—			—			1,395			—			1,395
Net income (loss) attributable to common stockholders	$	78,703		$	(99,973	)	$	155,635		$	(55,662	)	$	78,703

CONDENSED CONSOLIDATING STATEMENT OF INCOME



	For the Three Months Ended March 31, 2017
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries			Consolidated Elimination			Consolidated
	(In thousands)
Revenues
Rental income	$	585		$	47,819		$	346,818		$	—		$	395,222
Resident fees and services	—			—			464,188			—			464,188
Office building and other services revenue	—			—			3,406			—			3,406
Income from loans and investments	281			—			19,865			—			20,146
Equity earnings in affiliates	136,989			—			(308		)	(136,681		)	—
Interest and other income	343			—			138			—			481
Total revenues	138,198			47,819			834,107			(136,681		)	883,443
Expenses
Interest	(16,600		)	74,789			50,615			—			108,804
Depreciation and amortization	1,409			2,371			214,003			—			217,783
Property-level operating expenses	—			83			368,904			—			368,987
Office building services costs	—			—			738			—			738
General, administrative and professional fees	130			4,700			29,131			—			33,961
Loss on extinguishment of debt, net	—			19			290			—			309
Merger-related expenses and deal costs	1,863			—			193			—			2,056
Other	(349		)	—			1,537			—			1,188
Total expenses	(13,547		)	81,962			665,411			—			733,826
Income (loss) before unconsolidated entities, income taxes, discontinued operations, real estate dispositions and noncontrolling interests	151,745			(34,143		)	168,696			(136,681		)	149,617
Income (loss) from unconsolidated entities	—			3,321			(171		)	—			3,150
Income tax benefit	3,145			—			—			—			3,145
Income (loss) from continuing operations	154,890			(30,822		)	168,525			(136,681		)	155,912
Discontinued operations	(53		)	—			—			—			(53		)
Gain (loss) on real estate dispositions	43,290			—			(1		)	—			43,289
Net income (loss)	198,127			(30,822		)	168,524			(136,681		)	199,148
Net income attributable to noncontrolling interests	—			—			1,021			—			1,021
Net income (loss) attributable to common stockholders	$	198,127		$	(30,822	)	$	167,503		$	(136,681	)	$	198,127

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME



	For the Three Months Ended March 31, 2018
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries		Consolidated Elimination			Consolidated
	(In thousands)
Net income (loss)	$	78,703		$	(99,973	)	$	157,030	$	(55,662	)	80,098
Other comprehensive (loss) income:
Foreign currency translation	—			—			12,203		—			12,203
Unrealized loss on government-sponsored pooled loan investments	(172		)	—			—		—			(172		)
Other	—			—			8,615		—			8,615
Total other comprehensive (loss) income	(172		)	—			20,818		—			20,646
Comprehensive income (loss)	78,531			(99,973		)	177,848		(55,662		)	100,744
Comprehensive income attributable to noncontrolling interests	—			—			1,395		—			1,395
Comprehensive income (loss) attributable to common stockholders	$	78,531		$	(99,973	)	$	176,453	$	(55,662	)	$	99,349



	For the Three Months Ended March 31, 2017
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries			Consolidated Elimination			Consolidated
	(In thousands)
Net income (loss)	$	198,127		$	(30,822	)	$	168,524		$	(136,681	)	$	199,148
Other comprehensive (loss) income:
Foreign currency translation	—			—			4,082			—			4,082
Unrealized loss on government-sponsored pooled loan investments	(123		)	—			—			—			(123		)
Other	—			—			(82		)	—			(82		)
Total other comprehensive (loss) income	(123		)	—			4,000			—			3,877
Comprehensive income (loss)	198,004			(30,822		)	172,524			(136,681		)	203,025
Comprehensive income attributable to noncontrolling interests	—			—			1,021			—			1,021
Comprehensive income (loss) attributable to common stockholders	$	198,004		$	(30,822	)	$	171,503		$	(136,681	)	$	202,004

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS



	For the Three Months Ended March 31, 2018
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries			Consolidated Elimination		Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(19,658	)	$	(58,563	)	$	386,240		$	—	$	308,019

Cash flows from investing activities:
Net investment in real estate property	(11,450		)	—			—			—		(11,450		)
Investment in loans receivable and other	(2,740		)	—			(1,641		)	—		(4,381		)
Proceeds from real estate disposals	175,370			—			—			—		175,370
Proceeds from loans receivable	1,441			—			141,653			—		143,094
Development project expenditures	—			—			(73,889		)	—		(73,889		)
Capital expenditures	—			—			(20,617		)	—		(20,617		)
Investment in unconsolidated entities	—			—			(39,101		)	—		(39,101		)
Insurance proceeds for property damage claims	—			—			1,527			—		1,527
Net cash provided by investing activities	162,621			—			7,932			—		170,553

Cash flows from financing activities:
Net change in borrowings under revolving credit facilities	—			266,764			7,079			—		273,843
Proceeds from debt	—			655,044			83,475			—		738,519
Repayment of debt	—			(1,211,811		)	(5,307		)	—		(1,217,118		)
Net change in intercompany debt	51,808			354,019			(405,827		)	—		—
Payment of deferred financing costs	—			(5,621		)	(697		)	—		(6,318		)
Cash distribution from (to) affiliates	50,937			168			(51,105		)	—		—
Cash distribution to common stockholders	(281,635		)	—			—			—		(281,635		)
Cash distribution to redeemable OP unitholders	—			—			(1,858		)	—		(1,858		)
Cash issued for redemption of OP and Class C Units	—			—			(655		)	—		(655		)
Distributions to noncontrolling interests	—			—			(3,339		)	—		(3,339		)
Other	(4,687		)	—			—			—		(4,687		)
Net cash (used in) provided by financing activities	(183,577		)	58,563			(378,234		)	—		(503,248		)
Net (decrease) increase in cash, cash equivalents and restricted cash	(40,614		)	—			15,938			—		(24,676		)
Effect of foreign currency translation	12,381			—			(12,376		)	—		5
Cash, cash equivalents and restricted cash at beginning of period	49,644			128			138,481			—		188,253
Cash, cash equivalents and restricted cash at end of period	$	21,411		$	128		$	142,043		$	—	$	163,582

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS



	For the Three Months Ended March 31, 2017
	Ventas, Inc.			Ventas Realty			Ventas Subsidiaries			Consolidated Elimination		Consolidated
	(In thousands)
Net cash provided by (used in) operating activities	$	4,275		$	(32,622	)	$	374,161		$	—	$	345,814

Cash flows from investing activities:
Net investment in real estate property	(283,837		)	—			—			—		(283,837		)
Investment in loans receivable and other	(2,313		)	—			(699,045		)	—		(701,358		)
Proceeds from real estate disposals	85,000			—			—			—		85,000
Proceeds from loans receivable	—			—			3,363			—		3,363
Development project expenditures	—			—			(86,452		)	—		(86,452		)
Capital expenditures	—			(9		)	(23,826		)	—		(23,835		)
Investment in unconsolidated entities	—			—			(26,940		)	—		(26,940		)
Insurance proceeds for property damage claims	—			—			1,393			—		1,393
Net cash used in investing activities	(201,150		)	(9		)	(831,507		)	—		(1,032,666		)

Cash flows from financing activities:
Net change in borrowings under revolving credit facility	—			18,000			4,822			—		22,822
Proceeds from debt	—			793,904			3,310			—		797,214
Repayment of debt	—			(19		)	(20,477		)	—		(20,496		)
Purchase of noncontrolling interests	(15,809		)	—			—			—		(15,809		)
Net change in intercompany debt	577,099			(800,193		)	223,094			—		—
Payment of deferred financing costs	—			(6,384		)	—			—		(6,384		)
Cash distribution (to) from affiliates	(298,190		)	27,367			270,823			—		—
Cash distribution to common stockholders	(275,368		)	—			—			—		(275,368		)
Cash distribution to redeemable OP unitholders	—			—			(1,893		)	—		(1,893		)
Contributions from noncontrolling interest	—			—			2,102			—		2,102
Distributions to noncontrolling interests	—			—			(2,410		)	—		(2,410		)
Other	3,297			—			—			—		3,297
Net cash (used in) provided by financing activities	(8,971		)	32,675			479,371			—		503,075
Net (decrease) increase in cash, cash equivalents and restricted cash	(205,846		)	44			22,025			—		(183,777		)
Effect of foreign currency translation	5,146			—			(5,264		)	—		(118		)
Cash, cash equivalents and restricted cash at beginning of period	210,501			1,504			155,349			—		367,354
Cash, cash equivalents and restricted cash at end of period	$	9,801		$	1,548		$	172,110		$	—	$	183,459