Subsequent Events

3 Months Ended

Mar. 31, 2014

Subsequent Events

Subsequent Events

(20) Subsequent Events

Contingent upon the closing of the announced Brookdale and Emeritus merger, on April 23, 2014, HCP and Brookdale agreed to create a new $1.2 billion (before in-place refundable entry fee obligations) strategic joint venture to own and operate entry fee continuing care retirement communities (“CCRC JV”), representing 14 CCRC campuses, at closing. HCP and Brookdale will own 49% and 51%, respectively, of the CCRC JV based on each company’s respective contributions at closing. Brookdale will continue to manage all properties post-closing under a long-term management agreement.

Further, all existing Emeritus purchase options encompassing 49 HCP properties will be cancelled at closing; in exchange, all triple-net leases between HCP and Emeritus covering 202 senior housing properties will be amended contemporaneously, resulting in two portfolios: (i) RIDEA Portfolio:  49 non-stabilized properties will be contributed into to a RIDEA joint venture, with Brookdale managing the communities and acquiring a 20% ownership in the venture; and (ii)  NNN—leased Portfolio:  Brookdale and HCP will amend the triple-net master leases for the remaining 153 properties all guaranteed by Brookdale.