QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||
(State or other jurisdiction of Incorporation) | (IRS Employer Identification No.) | ||||
(Address of principal executive offices) | (Zip Code) | ||||
(Registrant’s telephone number, including area code) | |||||
Not Applicable | |||||
(Former name, former address and former fiscal year, if changed since last report) | |||||
Securities registered pursuant to Section 12(b) of the Act | ||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
þ | Accelerated filer | ¨ | Non-accelerated filer | ¨ | Smaller reporting company | Emerging growth company | |||
(Do not check if a smaller reporting company) | |||||||||
Page | |
PART I. FINANCIAL INFORMATION | |
Item 1. Financial Statements (Unaudited) | |
Consolidated Balance Sheets | |
Consolidated Statements of Comprehensive Income | |
Consolidated Statements of Equity | |
Consolidated Statements of Cash Flows | |
Notes to Unaudited Consolidated 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. OTHER INFORMATION | |
Item 1. Legal Proceedings | |
Item 1A. Risk Factors | |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | |
Item 5. Other Information | |
Item 6. Exhibits | |
Signatures | |
September 30, 2019 (Unaudited) | December 31, 2018 (Note) | |||||||
Assets: | ||||||||
Real estate investments: | ||||||||
Real property owned: | ||||||||
Land and land improvements | $ | $ | ||||||
Buildings and improvements | ||||||||
Acquired lease intangibles | ||||||||
Real property held for sale, net of accumulated depreciation | ||||||||
Construction in progress | ||||||||
Less accumulated depreciation and amortization | ( | ) | ( | ) | ||||
Net real property owned | ||||||||
Right of use assets, net | — | |||||||
Real estate loans receivable, net of allowance | ||||||||
Net real estate investments | ||||||||
Other assets: | ||||||||
Investments in unconsolidated entities | ||||||||
Goodwill | ||||||||
Cash and cash equivalents | ||||||||
Restricted cash | ||||||||
Straight-line rent receivable | ||||||||
Receivables and other assets | ||||||||
Total other assets | ||||||||
Total assets | $ | $ | ||||||
Liabilities and equity | ||||||||
Liabilities: | ||||||||
Unsecured credit facility and commercial paper | $ | $ | ||||||
Senior unsecured notes | ||||||||
Secured debt | ||||||||
Lease liabilities | ||||||||
Accrued expenses and other liabilities | ||||||||
Total liabilities | ||||||||
Redeemable noncontrolling interests | ||||||||
Equity: | ||||||||
Preferred stock | ||||||||
Common stock | ||||||||
Capital in excess of par value | ||||||||
Treasury stock | ( | ) | ( | ) | ||||
Cumulative net income | ||||||||
Cumulative dividends | ( | ) | ( | ) | ||||
Accumulated other comprehensive income (loss) | ( | ) | ( | ) | ||||
Other equity | ||||||||
Total Welltower Inc. stockholders’ equity | ||||||||
Noncontrolling interests | ||||||||
Total equity | ||||||||
Total liabilities and equity | $ | $ | ||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Resident fees and services | $ | $ | $ | $ | ||||||||||||
Rental income | ||||||||||||||||
Interest income | ||||||||||||||||
Other income | ||||||||||||||||
Total revenues | ||||||||||||||||
Expenses: | ||||||||||||||||
Property operating expenses | ||||||||||||||||
Depreciation and amortization | ||||||||||||||||
Interest expense | ||||||||||||||||
General and administrative expenses | ||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | ( | ) | ||||||||||||||
Loss (gain) on extinguishment of debt, net | ||||||||||||||||
Provision for loan losses | ||||||||||||||||
Impairment of assets | ||||||||||||||||
Other expenses | ||||||||||||||||
Total expenses | ||||||||||||||||
Income (loss) from continuing operations before income taxes and other items | ||||||||||||||||
Income tax (expense) benefit | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Income (loss) from unconsolidated entities | ( | ) | ( | ) | ||||||||||||
Gain (loss) on real estate dispositions, net | ||||||||||||||||
Income (loss) from continuing operations | ||||||||||||||||
Net income | ||||||||||||||||
Less: Preferred stock dividends | ||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests(1) | ||||||||||||||||
Net income (loss) attributable to common stockholders | $ | $ | $ | $ | ||||||||||||
Average number of common shares outstanding: | ||||||||||||||||
Basic | ||||||||||||||||
Diluted | ||||||||||||||||
Earnings per share: | ||||||||||||||||
Basic: | ||||||||||||||||
Income (loss) from continuing operations | $ | $ | $ | $ | ||||||||||||
Net income (loss) attributable to common stockholders | $ | $ | $ | $ | ||||||||||||
Diluted: | ||||||||||||||||
Income (loss) from continuing operations | $ | $ | $ | $ | ||||||||||||
Net income (loss) attributable to common stockholders | $ | $ | $ | $ | ||||||||||||
Dividends declared and paid per common share | $ | $ | $ | $ | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||
Other comprehensive income (loss): | ||||||||||||||||
Foreign currency translation gain (loss) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Derivative instruments gain (loss) | ||||||||||||||||
Total other comprehensive income (loss) | ( | ) | ( | ) | ( | ) | ||||||||||
Total comprehensive income (loss) | ||||||||||||||||
Less: Total comprehensive income (loss) attributable to noncontrolling interests(1) | ||||||||||||||||
Total comprehensive income (loss) attributable to common stockholders | $ | $ | $ | $ | ||||||||||||
(1) Includes amounts attributable to redeemable noncontrolling interests. | ||||||||||||||||
Preferred Stock | Common Stock | Capital in Excess of Par Value | Treasury Stock | Cumulative Net Income | Cumulative Dividends | Accumulated Other Comprehensive Income (Loss) | Other Equity | Noncontrolling Interests | Total | |||||||||||||||||||||||||||||||
Balances at December 31, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||||||||||
Net change in noncontrolling interests | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
Amounts related to stock incentive plans, net of forfeitures | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | ||||||||||||||||||||||||||||||||||||||||
Conversion of preferred stock | ( | ) | ||||||||||||||||||||||||||||||||||||||
Dividends paid: | ||||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Balances at March 31, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | ||||||||||||||||||||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||||||||||
Net change in noncontrolling interests | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
Amounts related to stock incentive plans, net of forfeitures | ( | ) | ||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | ||||||||||||||||||||||||||||||||||||||||
Dividends paid: | ||||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Balances at June 30, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||||||||||
Net change in noncontrolling interests | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Amounts related to stock incentive plans, net of forfeitures | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | ||||||||||||||||||||||||||||||||||||||||
Dividends paid: | ||||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Balances at September 30, 2019 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Preferred Stock | Common Stock | Capital in Excess of Par Value | Treasury Stock | Cumulative Net Income | Cumulative Dividends | Accumulated Other Comprehensive Income (Loss) | Other Equity | Noncontrolling Interests | Total | |||||||||||||||||||||||||||||||
Balances at December 31, 2017 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | ( | ) | ||||||||||||||||||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||||||||||
Net change in noncontrolling interests | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
Amounts related to stock incentive plans, net of forfeitures | ( | ) | ||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | ||||||||||||||||||||||||||||||||||||||||
Conversion of preferred stock | ( | ) | ||||||||||||||||||||||||||||||||||||||
Dividends paid: | ||||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Preferred stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Balances at March 31, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||||||||||
Net change in noncontrolling interests | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
Amounts related to stock incentive plans, net of forfeitures | ( | ) | ||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | ||||||||||||||||||||||||||||||||||||||||
Dividends paid: | ||||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Preferred stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Balances at June 30, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Total comprehensive income | ||||||||||||||||||||||||||||||||||||||||
Net change in noncontrolling interests | ( | ) | ||||||||||||||||||||||||||||||||||||||
Amounts related to stock incentive plans, net of forfeitures | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | ||||||||||||||||||||||||||||||||||||||||
Dividends paid: | ||||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Preferred stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
Balances at September 30, 2018 | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||
Nine Months Ended | ||||||||
September 30, | ||||||||
2019 | 2018 | |||||||
Operating activities: | ||||||||
Net income | $ | $ | ||||||
Adjustments to reconcile net income to net cash provided from (used in) operating activities: | ||||||||
Depreciation and amortization | ||||||||
Other amortization expenses | ||||||||
Provision for loan losses | ||||||||
Impairment of assets | ||||||||
Stock-based compensation expense | ||||||||
Loss (gain) on derivatives and financial instruments, net | ( | ) | ||||||
Loss (gain) on extinguishment of debt, net | ||||||||
Loss (income) from unconsolidated entities | ||||||||
Rental income less than (in excess of) cash received | ( | ) | ( | ) | ||||
Amortization related to above (below) market leases, net | ( | ) | ||||||
Loss (gain) on real estate dispositions, net | ( | ) | ( | ) | ||||
Distributions by unconsolidated entities | ||||||||
Increase (decrease) in accrued expenses and other liabilities | ||||||||
Decrease (increase) in receivables and other assets | ( | ) | ( | ) | ||||
Net cash provided from (used in) operating activities | ||||||||
Investing activities: | ||||||||
Cash disbursed for acquisitions | ( | ) | ( | ) | ||||
Cash disbursed for capital improvements to existing properties | ( | ) | ( | ) | ||||
Cash disbursed for construction in progress | ( | ) | ( | ) | ||||
Capitalized interest | ( | ) | ( | ) | ||||
Investment in real estate loans receivable | ( | ) | ( | ) | ||||
Principal collected on real estate loans receivable | ||||||||
Other investments, net of payments | ( | ) | ( | ) | ||||
Contributions to unconsolidated entities | ( | ) | ( | ) | ||||
Distributions by unconsolidated entities | ||||||||
Proceeds from (payments on) derivatives | ( | ) | ||||||
Proceeds from sales of real property | ||||||||
Net cash provided from (used in) investing activities | ( | ) | ( | ) | ||||
Financing activities: | ||||||||
Net increase (decrease) in unsecured credit facility and commercial paper | ||||||||
Proceeds from issuance of senior unsecured notes | ||||||||
Payments to extinguish senior unsecured notes | ( | ) | ( | ) | ||||
Net proceeds from the issuance of secured debt | ||||||||
Payments on secured debt | ( | ) | ( | ) | ||||
Net proceeds from the issuance of common stock | ||||||||
Payments for deferred financing costs and prepayment penalties | ( | ) | ( | ) | ||||
Contributions by noncontrolling interests(1) | ||||||||
Distributions to noncontrolling interests(1) | ( | ) | ( | ) | ||||
Cash distributions to stockholders | ( | ) | ( | ) | ||||
Other financing activities | ( | ) | ( | ) | ||||
Net cash provided from (used in) financing activities | ( | ) | ||||||
Effect of foreign currency translation on cash, cash equivalents and restricted cash | ( | ) | ( | ) | ||||
Increase (decrease) in cash, cash equivalents and restricted cash | ( | ) | ||||||
Cash, cash equivalents and restricted cash at beginning of period | ||||||||
Cash, cash equivalents and restricted cash at end of period | $ | $ | ||||||
Supplemental cash flow information: | ||||||||
Interest paid | $ | $ | ||||||
Income taxes paid (received), net | ||||||||
(1) Includes amounts attributable to redeemable noncontrolling interests. | ||||||||
• | We adopted Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) ("ASC 842") which requires lessees to recognize assets and liabilities on their consolidated balance sheet related to the rights and obligations created by most leases, while continuing to recognize expenses on their consolidated statement of comprehensive income over the lease term. We adopted ASC 842 as of January 1, 2019, using the modified retrospective approach and have elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, permits us to carry forward our prior conclusions for lease classification and initial direct costs on existing leases. We also made an accounting policy election to keep short-term leases less than twelve months off the balance sheet for all classes of underlying assets. |
• |
Nine Months Ended | |||||||||||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | ||||||||||||||||||||||||||||||
Seniors Housing Operating | Triple-net | Outpatient Medical | Totals | Seniors Housing Operating | Triple-net | Outpatient Medical | Totals | ||||||||||||||||||||||||
Land and land improvements | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Buildings and improvements | |||||||||||||||||||||||||||||||
Acquired lease intangibles | |||||||||||||||||||||||||||||||
Construction in progress | |||||||||||||||||||||||||||||||
Real property held for sale | |||||||||||||||||||||||||||||||
Right of use assets, net | — | — | — | — | |||||||||||||||||||||||||||
Receivables and other assets | |||||||||||||||||||||||||||||||
Total assets acquired(1) | |||||||||||||||||||||||||||||||
Secured debt | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
Lease liabilities | ( | ) | ( | ) | — | — | — | — | |||||||||||||||||||||||
Accrued expenses and other liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||
Total liabilities acquired | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||
Noncontrolling interests(2) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Non-cash acquisition related activity(3) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Cash disbursed for acquisitions | |||||||||||||||||||||||||||||||
Construction in progress additions | |||||||||||||||||||||||||||||||
Less: Capitalized interest | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||
Foreign currency translation | |||||||||||||||||||||||||||||||
Accruals(4) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Cash disbursed for construction in progress | |||||||||||||||||||||||||||||||
Capital improvements to existing properties | |||||||||||||||||||||||||||||||
Total cash invested in real property, net of cash acquired | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Nine Months Ended | ||||||||
September 30, 2019 | September 30, 2018 | |||||||
Development projects: | ||||||||
Seniors Housing Operating | $ | $ | ||||||
Triple-net | ||||||||
Outpatient Medical | ||||||||
Total development projects | ||||||||
Expansion projects | ||||||||
Total construction in progress conversions | $ | $ | ||||||
September 30, 2019 | December 31, 2018 | |||||||
Assets: | ||||||||
In place lease intangibles | $ | $ | ||||||
Above market tenant leases | ||||||||
Below market ground leases (1) | — | |||||||
Lease commissions | ||||||||
Gross historical cost | ||||||||
Accumulated amortization | ( | ) | ( | ) | ||||
Net book value | $ | $ | ||||||
Weighted-average amortization period in years | ||||||||
Liabilities: | ||||||||
Below market tenant leases | $ | $ | ||||||
Above market ground leases (1) | — | |||||||
Gross historical cost | ||||||||
Accumulated amortization | ( | ) | ( | ) | ||||
Net book value | $ | $ | ||||||
Weighted-average amortization period in years | ||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Rental income related to (above)/below market tenant leases, net | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
Amortization related to in place lease intangibles and lease commissions | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Assets | Liabilities | |||||||
2019 | $ | $ | ||||||
2020 | ||||||||
2021 | ||||||||
2022 | ||||||||
2023 | ||||||||
Thereafter | ||||||||
Total | $ | $ | ||||||
Nine Months Ended September 30, | ||||||||
2019 | 2018 | |||||||
Real estate dispositions: | ||||||||
Seniors Housing Operating | $ | $ | ||||||
Triple-net | ||||||||
Outpatient Medical | ||||||||
Total dispositions | ||||||||
Gain (loss) on real estate dispositions, net | ||||||||
Net other assets/liabilities disposed | ( | ) | ||||||
Proceeds from real estate dispositions | $ | $ | ||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Revenues: | ||||||||||||||||
Total revenues | $ | $ | $ | $ | ||||||||||||
Expenses: | ||||||||||||||||
Interest expense | ||||||||||||||||
Property operating expenses | ||||||||||||||||
Provision for depreciation | ||||||||||||||||
Total expenses | ||||||||||||||||
Income (loss) from real estate dispositions, net | $ | $ | $ | $ | ||||||||||||
Classification | Three Months Ended September 30, 2019 | Nine Months Ended September 30, 2019 | ||||||||
Operating lease cost: (1) | ||||||||||
Real estate lease expense | Property operating expenses | $ | $ | |||||||
Non-real estate lease expense | General and administrative expenses | |||||||||
Finance lease cost: | ||||||||||
Amortization of leased assets | Property operating expenses | |||||||||
Interest on lease liabilities | Interest expense | |||||||||
Sublease income | Rental income | ( | ) | ( | ) | |||||
Total | $ | $ | ||||||||
Operating Leases | Finance Leases | |||||||
2019 | $ | $ | ||||||
2020 | ||||||||
2021 | ||||||||
2022 | ||||||||
2023 | ||||||||
Thereafter | ||||||||
Total lease payments | ||||||||
Less: Imputed interest | ( | ) | ( | ) | ||||
Total present value of lease liabilities | $ | $ | ||||||
Classification | September 30, 2019 | ||||
Right of use assets: | |||||
Operating leases - real estate | Right of use assets, net | $ | |||
Finance leases - real estate | Right of use assets, net | ||||
Real estate right of use assets, net | |||||
Operating leases - corporate | Receivables and other assets | ||||
Total right of use assets, net | $ | ||||
Lease liabilities: | |||||
Operating leases | $ | ||||
Financing leases | |||||
Total | $ | ||||
Weighted average remaining lease term (years): | |||||
Operating leases | |||||
Finance leases | |||||
Weighted average discount rate: | |||||
Operating leases | % | ||||
Finance leases | % | ||||
Classification | Nine Months Ended September 30, 2019 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | |||||
Operating cash flows from operating leases | Decrease (increase) in receivables and other assets | $ | |||
Operating cash flows from operating leases | Increase (decrease) in accrued expenses and other liabilities | ( | ) | ||
Operating cash flows from finance leases | Decrease (increase) in receivables and other assets | ||||
Financing cash flows from finance leases | Other financing activities | ( | ) | ||
2019 | $ | |||
2020 | ||||
2021 | ||||
2022 | ||||
2023 | ||||
Thereafter | ||||
Totals | $ | |||
September 30, 2019 | December 31, 2018 | |||||||
Mortgage loans | $ | $ | ||||||
Other real estate loans | ||||||||
Less allowance for losses on loans receivable | ( | ) | ( | ) | ||||
Totals | $ | $ | ||||||
Nine Months Ended | ||||||||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | |||||||||||||||||||||||||||
Triple-net | Outpatient Medical | Totals | Seniors Housing Operating | Triple-net | Outpatient Medical | Totals | ||||||||||||||||||||||
Advances on real estate loans receivable: | ||||||||||||||||||||||||||||
Investments in new loans | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Draws on existing loans | ||||||||||||||||||||||||||||
Net cash advances on real estate loans | ||||||||||||||||||||||||||||
Receipts on real estate loans receivable: | ||||||||||||||||||||||||||||
Loan payoffs | ||||||||||||||||||||||||||||
Principal payments on loans | ||||||||||||||||||||||||||||
Net cash receipts on real estate loans | ||||||||||||||||||||||||||||
Net cash advances (receipts) on real estate loans | $ | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | |||||||||||||||||
Nine Months Ended | ||||||||
September 30, 2019 | September 30, 2018 | |||||||
Balance of impaired loans at end of period | $ | $ | ||||||
Allowance for loan losses | ||||||||
Balance of impaired loans not reserved | $ | $ | ||||||
Average impaired loans for the period | $ | $ | ||||||
Interest recognized on impaired loans(1) | ||||||||
Percentage Ownership(1) | September 30, 2019 | December 31, 2018 | ||||||||
Seniors Housing Operating | 10% to 50% | $ | $ | |||||||
Triple-net | 10% to 49% | |||||||||
Outpatient Medical | 43% to 50% | |||||||||
Total | $ | $ | ||||||||
Number of | Total | Percent of | |||||||
Concentration by relationship:(1,4) | Properties | NOI | NOI(2) | ||||||
Sunrise Senior Living(3) | $ | ||||||||
ProMedica | |||||||||
Revera(3) | |||||||||
Genesis HealthCare | |||||||||
Belmont Village | |||||||||
Remaining portfolio | |||||||||
Totals | $ | ||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Balance outstanding at quarter end | $ | $ | $ | $ | ||||||||||||
Maximum amount outstanding at any month end | $ | $ | $ | $ | ||||||||||||
Average amount outstanding (total of daily | ||||||||||||||||
principal balances divided by days in period) | $ | $ | $ | $ | ||||||||||||
Weighted average interest rate (actual interest | ||||||||||||||||
expense divided by average borrowings outstanding) | % | % | % | % | ||||||||||||
Senior Unsecured Notes(1,2) | Secured Debt (1,3) | Totals | ||||||||||
2019 | $ | $ | $ | |||||||||
2020(4) | ||||||||||||
2021 | ||||||||||||
2022 | ||||||||||||
2023(5,6) | ||||||||||||
Thereafter(7,8) | ||||||||||||
Totals | $ | $ | $ | |||||||||
Nine Months Ended | ||||||||||||
September 30, 2019 | September 30, 2018 | |||||||||||
Weighted Avg. | Weighted Avg. | |||||||||||
Amount | Interest Rate | Amount | Interest Rate | |||||||||
Beginning balance | $ | $ | ||||||||||
Debt issued | ||||||||||||
Debt extinguished | ( | ) | ( | ) | ||||||||
Foreign currency | ( | ) | ( | ) | ||||||||
Ending balance | $ | $ | ||||||||||
Nine Months Ended | ||||||||||||
September 30, 2019 | September 30, 2018 | |||||||||||
Weighted Avg. | Weighted Avg. | |||||||||||
Amount | Interest Rate | Amount | Interest Rate | |||||||||
Beginning balance | $ | $ | ||||||||||
Debt issued | ||||||||||||
Debt assumed | ||||||||||||
Debt extinguished | ( | ) | ( | ) | ||||||||
Principal payments | ( | ) | ( | ) | ||||||||
Foreign currency | ( | ) | ||||||||||
Ending balance | $ | $ | ||||||||||
September 30, 2019 | December 31, 2018 | |||||||
Derivatives designated as net investment hedges: | ||||||||
Denominated in Canadian Dollars | $ | $ | ||||||
Denominated in Pounds Sterling | £ | £ | ||||||
Financial instruments designated as net investment hedges: | ||||||||
Denominated in Canadian Dollars | $ | $ | ||||||
Denominated in Pounds Sterling | £ | £ | ||||||
Interest rate swaps designated as cash flow hedges: | ||||||||
Denominated in U.S Dollars (1) | $ | $ | ||||||
Derivative instruments not designated: | ||||||||
Interest rate caps denominated in U.S. Dollars | $ | $ | ||||||
Forward purchase contracts denominated in Canadian Dollars | $ | ( | ) | $ | ( | ) | ||
Forward sales contracts denominated in Canadian Dollars | $ | $ | ||||||
Forward purchase contracts denominated in Pounds Sterling | £ | ( | ) | £ | ( | ) | ||
Forward sales contracts denominated in Pounds Sterling | £ | £ | ||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||
Location | 2019 | 2018 | 2019 | 2018 | ||||||||||||||
Gain (loss) on derivative instruments designated as hedges recognized in income | Interest expense | $ | $ | $ | $ | |||||||||||||
Gain (loss) on derivative instruments not designated as hedges recognized in income | Interest expense | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||
Gain (loss) on foreign exchange contracts and term loans designated as net investment hedge recognized in OCI | OCI | $ | $ | $ | $ | |||||||||||||
September 30, 2019 | December 31, 2018 | |||||
Preferred Stock: | ||||||
Authorized shares | ||||||
Issued shares | ||||||
Outstanding shares | ||||||
Common Stock, $1.00 par value: | ||||||
Authorized shares | ||||||
Issued shares | ||||||
Outstanding shares | ||||||
Nine Months Ended | ||||||||||
September 30, 2019 | September 30, 2018 | |||||||||
Weighted Avg. | Weighted Avg. | |||||||||
Shares | Dividend Rate | Shares | Dividend Rate | |||||||
Beginning balance | ||||||||||
Shares converted | ( | ) | ( | ) | ||||||
Ending balance | ||||||||||
Shares Issued | Average Price | Gross Proceeds | Net Proceeds | ||||||||||||
2018 Dividend reinvestment plan issuances | $ | $ | $ | ||||||||||||
2018 Option exercises | |||||||||||||||
2018 Equity shelf program issuances | |||||||||||||||
2018 Preferred stock conversions | — | — | |||||||||||||
2018 Stock incentive plans, net of forfeitures | — | — | |||||||||||||
2018 Totals | $ | $ | |||||||||||||
2019 Dividend reinvestment plan issuances | $ | $ | $ | ||||||||||||
2019 Option exercises | |||||||||||||||
2019 Equity Shelf Program issuances | |||||||||||||||
2019 Preferred stock conversions | — | — | |||||||||||||
2019 Stock incentive plans, net of forfeitures | — | — | |||||||||||||
2019 Totals | $ | $ | |||||||||||||
Nine Months Ended | ||||||||||||||||
September 30, 2019 | September 30, 2018 | |||||||||||||||
Per Share | Amount | Per Share | Amount | |||||||||||||
Common Stock | $ | $ | $ | $ | ||||||||||||
Series I Preferred Stock | ||||||||||||||||
Totals | $ | $ | ||||||||||||||
September 30, 2019 | December 31, 2018 | |||||||
Foreign currency translation | $ | ( | ) | $ | ( | ) | ||
Derivative instruments | ||||||||
Actuarial losses | ( | ) | ( | ) | ||||
Total accumulated other comprehensive loss | $ | ( | ) | $ | ( | ) | ||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Numerator for basic and diluted earnings | ||||||||||||||||
per share - net income (loss) attributable | ||||||||||||||||
to common stockholders | $ | $ | $ | $ | ||||||||||||
Denominator for basic earnings per | ||||||||||||||||
share - weighted average shares | ||||||||||||||||
Effect of dilutive securities: | ||||||||||||||||
Employee stock options | ||||||||||||||||
Non-vested restricted shares | ||||||||||||||||
Redeemable shares | ||||||||||||||||
Employee stock purchase program | ||||||||||||||||
Dilutive potential common shares | ||||||||||||||||
Denominator for diluted earnings per | ||||||||||||||||
share - adjusted weighted average shares | ||||||||||||||||
Basic earnings per share | $ | $ | $ | $ | ||||||||||||
Diluted earnings per share | $ | $ | $ | $ | ||||||||||||
September 30, 2019 | December 31, 2018 | |||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
Financial assets: | ||||||||||||||||
Mortgage loans receivable | $ | $ | $ | $ | ||||||||||||
Other real estate loans receivable | ||||||||||||||||
Equity securities | ||||||||||||||||
Cash and cash equivalents | ||||||||||||||||
Restricted cash | ||||||||||||||||
Foreign currency forward contracts, interest rate swaps and cross currency swaps | ||||||||||||||||
Financial liabilities: | ||||||||||||||||
Unsecured revolving credit facility and commercial paper note program | $ | $ | $ | $ | ||||||||||||
Senior unsecured notes | ||||||||||||||||
Secured debt | ||||||||||||||||
Foreign currency forward contracts, interest rate swaps and cross currency swaps | ||||||||||||||||
Redeemable OP unitholder interests | $ | $ | $ | $ | ||||||||||||
Fair Value Measurements as of September 30, 2019 | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Equity securities | $ | $ | $ | $ | ||||||||||||
Foreign currency forward contracts, interest rate swaps and cross currency swaps, net asset (liability)(1) | ||||||||||||||||
Redeemable OP unitholder interests | ||||||||||||||||
Totals | $ | $ | $ | $ | ||||||||||||
Three Months Ended September 30, 2019: | Seniors Housing Operating | Triple-net | Outpatient Medical | Non-segment / Corporate | Total | |||||||||||||||
Resident fees and services | $ | $ | $ | $ | $ | |||||||||||||||
Rental income | ||||||||||||||||||||
Interest income | ||||||||||||||||||||
Other income | ||||||||||||||||||||
Total revenues | ||||||||||||||||||||
Property operating expenses | ||||||||||||||||||||
Consolidated net operating income | ||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||
Interest expense | ||||||||||||||||||||
General and administrative expenses | ||||||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | ||||||||||||||||||||
Loss (gain) on extinguishment of debt, net | ||||||||||||||||||||
Impairment of assets | ||||||||||||||||||||
Other expenses | ( | ) | ||||||||||||||||||
Income (loss) from continuing operations before income taxes and other items | ( | ) | ||||||||||||||||||
Income tax (expense) benefit | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
(Loss) income from unconsolidated entities | ( | ) | ||||||||||||||||||
Gain (loss) on real estate dispositions, net | ( | ) | ||||||||||||||||||
Income (loss) from continuing operations | ( | ) | ||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Total assets | $ | $ | $ | $ | $ | |||||||||||||||
Three Months Ended September 30, 2018: | Seniors Housing Operating | Triple-net | Outpatient Medical | Non-segment / Corporate | Total | |||||||||||||||
Resident fees and services | $ | $ | $ | $ | $ | |||||||||||||||
Rental income | ||||||||||||||||||||
Interest income | ||||||||||||||||||||
Other income | ||||||||||||||||||||
Total revenues | ||||||||||||||||||||
Property operating expenses | ||||||||||||||||||||
Consolidated net operating income | ||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||
Interest expense | ||||||||||||||||||||
General and administrative expenses | ||||||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | ||||||||||||||||||||
Loss (gain) on extinguishment of debt, net | ||||||||||||||||||||
Impairment of assets | ||||||||||||||||||||
Other expenses | ( | ) | ||||||||||||||||||
Income (loss) from continuing operations before income taxes and other items | ( | ) | ||||||||||||||||||
Income tax (expense) benefit | ( | ) | ( | ) | ||||||||||||||||
(Loss) income from unconsolidated entities | ( | ) | ||||||||||||||||||
Gain (loss) on real estate dispositions, net | ( | ) | ( | ) | ||||||||||||||||
Income (loss) from continuing operations | ( | ) | ||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Nine Months Ended September 30, 2019 | Seniors Housing Operating | Triple-net | Outpatient Medical | Non-segment / Corporate | Total | |||||||||||||||
Resident fees and services | $ | $ | $ | $ | $ | |||||||||||||||
Rental income | ||||||||||||||||||||
Interest income | ||||||||||||||||||||
Other income | ||||||||||||||||||||
Total revenues | ||||||||||||||||||||
Property operating expenses | ||||||||||||||||||||
Consolidated net operating income | ||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||
Interest expense | ||||||||||||||||||||
General and administrative expenses | ||||||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | ||||||||||||||||||||
Loss (gain) on extinguishment of debt, net | ||||||||||||||||||||
Provision for loan losses | ||||||||||||||||||||
Impairment of assets | ||||||||||||||||||||
Other expenses | ||||||||||||||||||||
Income (loss) from continuing operations before income taxes and other items | ( | ) | ||||||||||||||||||
Income tax (expense) benefit | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
(Loss) income from unconsolidated entities | ( | ) | ( | ) | ||||||||||||||||
Gain (loss) on real estate dispositions, net | ( | ) | ||||||||||||||||||
Income (loss) from continuing operations | ( | ) | ||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Nine Months Ended September 30, 2018 | Seniors Housing Operating | Triple-net | Outpatient Medical | Non-segment / Corporate | Total | |||||||||||||||
Resident fees and services | $ | $ | $ | $ | $ | |||||||||||||||
Rental income | ||||||||||||||||||||
Interest income | ||||||||||||||||||||
Other income | ||||||||||||||||||||
Total revenues | ||||||||||||||||||||
Property operating expenses | ||||||||||||||||||||
Consolidated net operating income | ||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||
Interest expense | ||||||||||||||||||||
General and administrative expenses | ||||||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | ( | ) | ( | ) | ||||||||||||||||
Loss (gain) on extinguishment of debt, net | ( | ) | ||||||||||||||||||
Impairment of assets | ||||||||||||||||||||
Other expenses | ||||||||||||||||||||
Income (loss) from continuing operations before income taxes and other items | ( | ) | ||||||||||||||||||
Income tax (expense) benefit | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
(Loss) income from unconsolidated entities | ( | ) | ( | ) | ||||||||||||||||
Gain (loss) on real estate dispositions, net | ||||||||||||||||||||
Income (loss) from continuing operations | ( | ) | ||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | ( | ) | $ | |||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | September 30, 2019 | September 30, 2018 | |||||||||||||||||||||||||
Revenues: | Amount | % | Amount | % | Amount | % | Amount | % | ||||||||||||||||||||
United States | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||
United Kingdom | % | % | % | % | ||||||||||||||||||||||||
Canada | % | % | % | % | ||||||||||||||||||||||||
Total | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||
As of | ||||||||||||||||||||||||||||
September 30, 2019 | December 31, 2018 | |||||||||||||||||||||||||||
Assets: | Amount | % | Amount | % | ||||||||||||||||||||||||
United States | $ | % | $ | % | ||||||||||||||||||||||||
United Kingdom | % | % | ||||||||||||||||||||||||||
Canada | % | % | ||||||||||||||||||||||||||
Total | $ | % | $ | % | ||||||||||||||||||||||||
September 30, 2019 | December 31, 2018 | |||||||
Assets: | ||||||||
Net real estate investments | $ | $ | ||||||
Cash and cash equivalents | ||||||||
Receivables and other assets | ||||||||
Total assets(1) | $ | $ | ||||||
Liabilities and equity: | ||||||||
Secured debt | $ | $ | ||||||
Lease liabilities | ||||||||
Accrued expenses and other liabilities | ||||||||
Total equity | ||||||||
Total liabilities and equity | $ | $ | ||||||
EXECUTIVE SUMMARY | ||
Company Overview | ||
Business Strategy | ||
Key Transactions | ||
Key Performance Indicators, Trends and Uncertainties | ||
Corporate Governance | ||
LIQUIDITY AND CAPITAL RESOURCES | ||
Sources and Uses of Cash | ||
Off-Balance Sheet Arrangements | ||
Contractual Obligations | ||
Capital Structure | ||
RESULTS OF OPERATIONS | ||
Summary | ||
Seniors Housing Operating | ||
Triple-net | ||
Outpatient Medical | ||
Non-Segment/Corporate | ||
OTHER | ||
Non-GAAP Financial Measures | ||
Critical Accounting Policies | ||
Cautionary Statement Regarding Forward-Looking Statements | ||
Percentage of | Number of | |||||||||
Type of Property | NOI(1) | NOI | Properties | |||||||
Seniors Housing Operating | $ | 254,155 | 41.7 | % | 524 | |||||
Triple-net | 230,685 | 37.8 | % | 657 | ||||||
Outpatient Medical | 124,864 | 20.5 | % | 358 | ||||||
Totals | $ | 609,704 | 100.0 | % | 1,539 | |||||
(1) Represents consolidated NOI and excludes our share of investments in unconsolidated entities. Entities in which we have a joint venture with a minority partner are shown at 100% of the joint venture amount. See Non-GAAP Financial Measures for additional information and reconciliation. | ||||||||||
• | In January 2019, we established an unsecured Commercial Paper Program. Under the terms of the program, we may issue, from time to time, unsecured commercial paper with maturities that vary, but do not exceed 397 days from the date of issue, up to a maximum aggregate principal amount outstanding at any time of $1,000,000,000. |
• | In February 2019, we completed the issuance of $500,000,000 of 3.625% senior unsecured notes due 2024 and $550,000,000 of 4.125% senior unsecured notes due 2029 for net proceeds of approximately $1,036,964,000. In August 2019, we completed the issuance of $750,000,000 of 3.10% senior unsecured notes due 2030 and a follow-on issuance of $450,000,000 of 3.625% senior unsecured notes due 2024 priced to yield 2.494%, for net proceeds of approximately $1,209,328,000. |
• | In February 2019, we elected to effect the mandatory conversion of all of the outstanding 6.50% Series I Cumulative Convertible Perpetual Preferred Stock. Each share of convertible stock was converted into 0.8857 shares of common stock. |
• | During the nine months ended September 30, 2019, we extinguished $193,604,000 of secured debt at a blended average interest rate of 4.37%. Additionally, in March 2019 we repaid our $600,000,000 of 4.125% senior unsecured notes due 2019 and $450,000,000 of 6.125% senior unsecured notes due 2020. In September 2019, we repaid our $450,000,000 of 4.95% senior unsecured notes due 2021 and $600,000,000 of 5.25% senior unsecured notes due 2022. |
• | In May 2019, we drew on a $1,000,000,000 unsecured term loan facility that matures on May 28, 2020 which was put in place to bridge the acquisition of the CNL Healthcare Properties portfolio. The unsecured term loan facility was subsequently extinguished in July 2019 with proceeds from the disposition of the Benchmark Senior Living portfolio. |
• | During the nine months ended September 30, 2019, we entered into amended and restated Equity Shelf Program (as defined below) pursuant to which we may offer and sell up to $1,500,000,000 of common stock from time to time. We sold 14,321,000 shares of common stock under our ATM and DRIP programs, via both cash settle and forward sale agreements, generating expected gross proceeds of approximately $1,134,967,000. |
Properties | Investment Amount(1) | Capitalization Rates(2) | Book Amount(3) | |||||||||||
Seniors Housing Operating | 53 | $ | 1,225,771 | 5.1 | % | $ | 1,361,201 | |||||||
Triple-net | 6 | 137,935 | 6.6 | % | 139,935 | |||||||||
Outpatient Medical | 75 | 1,591,807 | 5.7 | % | 1,674,358 | |||||||||
Totals | 134 | $ | 2,955,513 | 5.5 | % | $ | 3,175,494 | |||||||
(1) Represents stated pro rata purchase price including cash and any assumed debt but excludes fair value adjustments pursuant to U.S. GAAP. | ||||||||||||||
(2) Represents annualized contractual or projected net operating income to be received in cash divided by investment amounts. | ||||||||||||||
(3) Represents amounts recorded in net real estate investments including fair value adjustments pursuant to U.S. GAAP. See Note 3 to our unaudited consolidated financial statements for additional information. | ||||||||||||||
Properties | Proceeds(1) | Capitalization Rates(2) | Book Amount(3) | |||||||||||
Seniors Housing Operating(4) | 51 | $ | 1,772,276 | 5.4 | % | $ | 1,204,084 | |||||||
Triple-net | 57 | 902,731 | 7.9 | % | 660,885 | |||||||||
Outpatient Medical(5) | — | — | — | % | 482 | |||||||||
Totals | 108 | $ | 2,675,007 | 6.3 | % | $ | 1,865,451 | |||||||
(1) Represents pro rata proceeds received upon disposition including any seller financing. | ||||||||||||||
(2) Represents annualized contractual income that was being received in cash at date of disposition divided by disposition proceeds. | ||||||||||||||
(3) Represents carrying value of net real estate assets at time of disposition. See Note 5 to our unaudited consolidated financial statements for additional information. | ||||||||||||||
(4) Includes the disposition of an unconsolidated real estate investment. | ||||||||||||||
(5) Reflects the disposition of an excess land parcel. | ||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||||||||
2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | ||||||||||||||||||||||
Net income (loss) | $ | 453,555 | $ | 167,273 | $ | 84,226 | $ | 124,696 | $ | 292,302 | $ | 150,040 | $ | 647,932 | ||||||||||||||
NICS | 437,671 | 154,432 | 64,384 | 101,763 | 280,470 | 137,762 | 589,876 | |||||||||||||||||||||
FFO | 353,220 | 378,725 | 285,272 | 374,966 | 358,383 | 390,021 | 352,378 | |||||||||||||||||||||
NOI | 540,500 | 557,161 | 579,222 | 590,599 | 601,438 | 618,979 | 610,545 | |||||||||||||||||||||
Per share data (fully diluted): | ||||||||||||||||||||||||||||
NICS | $ | 1.17 | $ | 0.41 | $ | 0.17 | $ | 0.27 | $ | 0.71 | $ | 0.34 | $ | 1.45 | ||||||||||||||
FFO | $ | 0.95 | $ | 1.02 | $ | 0.76 | $ | 0.99 | $ | 0.91 | $ | 0.96 | $ | 0.87 | ||||||||||||||
Three Months Ended | ||||||||||||||
March, 31 | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||
2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | ||||||||
Net debt to book capitalization ratio | 42% | 42% | 46% | 45% | 43% | 48% | 45% | |||||||
Net debt to undepreciated book capitalization ratio | 35% | 36% | 39% | 38% | 36% | 41% | 38% | |||||||
Net debt to market capitalization ratio | 34% | 31% | 34% | 31% | 28% | 30% | 26% | |||||||
Interest coverage ratio | 6.67x | 4.34x | 3.38x | 3.60x | 4.80x | 3.74x | 7.61x | |||||||
Fixed charge coverage ratio | 5.49x | 3.58x | 2.85x | 3.05x | 4.38x | 3.42x | 6.96x | |||||||
Three Months Ended | ||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||
2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | ||||||||
Property mix:(1) | ||||||||||||||
Seniors Housing Operating | 42% | 43% | 46% | 43% | 44% | 45% | 42% | |||||||
Triple-net | 41% | 40% | 38% | 40% | 39% | 37% | 38% | |||||||
Outpatient Medical | 17% | 17% | 16% | 17% | 17% | 18% | 20% | |||||||
Relationship mix:(1) | ||||||||||||||
Sunrise Senior Living(2) | 15% | 15% | 15% | 14% | 15% | 14% | 14% | |||||||
ProMedica | —% | —% | 7% | 9% | 9% | 9% | 9% | |||||||
Revera(2) | 7% | 7% | 7% | 6% | 6% | 6% | 6% | |||||||
Genesis HealthCare | 6% | 6% | 6% | 6% | 5% | 5% | 5% | |||||||
Belmont Village | 3% | 3% | 3% | 3% | 3% | 3% | 4% | |||||||
Remaining relationships | 69% | 69% | 62% | 62% | 62% | 63% | 62% | |||||||
Geographic mix:(1) | ||||||||||||||
California | 14% | 14% | 13% | 13% | 13% | 13% | 14% | |||||||
United Kingdom | 10% | 9% | 9% | 9% | 9% | 8% | 8% | |||||||
Texas | 8% | 8% | 7% | 8% | 8% | 8% | 8% | |||||||
New Jersey | 8% | 7% | 7% | 7% | 7% | 7% | 7% | |||||||
Canada | 9% | 8% | 8% | 8% | 7% | 7% | 7% | |||||||
Remaining geographic areas | 51% | 54% | 56% | 55% | 56% | 57% | 56% | |||||||
(1) Excludes our share of investments in unconsolidated entities and non-segment/corporate NOI. Entities in which we have a joint venture with a minority partner are shown at 100% of the joint venture amount. | ||||||||||||||
(2) Revera owns a controlling interest in Sunrise Senior Living. | ||||||||||||||
Expiration Year(1) | ||||||||||||||||||||||||||||||||||||||||||||
2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | 2027 | 2028 | Thereafter | ||||||||||||||||||||||||||||||||||
Triple-net: | ||||||||||||||||||||||||||||||||||||||||||||
Properties | 8 | — | 6 | 10 | 2 | 4 | 48 | 94 | 19 | 15 | 430 | |||||||||||||||||||||||||||||||||
Base rent(2) | $ | 3,470 | $ | — | $ | 12,292 | $ | 10,496 | $ | 1,331 | $ | 11,096 | $ | 52,728 | $ | 122,530 | $ | 35,725 | $ | 22,036 | $ | 487,015 | ||||||||||||||||||||||
% of base rent | 0.5 | % | — | % | 1.6 | % | 1.4 | % | 0.2 | % | 1.5 | % | 6.9 | % | 16.1 | % | 4.7 | % | 2.9 | % | 64.2 | % | ||||||||||||||||||||||
Units/beds | 649 | — | 1,023 | 1,022 | 140 | 692 | 3,033 | 7,554 | 2,401 | 1,633 | 44,588 | |||||||||||||||||||||||||||||||||
% of Units/beds | 1.0 | % | — | % | 1.6 | % | 1.6 | % | 0.2 | % | 1.1 | % | 4.8 | % | 12.0 | % | 3.8 | % | 2.6 | % | 71.3 | % | ||||||||||||||||||||||
Outpatient Medical: | ||||||||||||||||||||||||||||||||||||||||||||
Square feet | 514,534 | 1,614,257 | 2,017,333 | 2,158,069 | 2,129,097 | 2,128,846 | 1,207,793 | 1,482,284 | 864,668 | 932,339 | 6,141,513 | |||||||||||||||||||||||||||||||||
Base rent(2) | $ | 11,453 | $ | 44,978 | $ | 56,712 | $ | 58,920 | $ | 57,737 | $ | 62,850 | $ | 31,700 | $ | 38,283 | $ | 21,554 | $ | 23,984 | $ | 133,599 | ||||||||||||||||||||||
% of base rent | 2.1 | % | 8.3 | % | 10.5 | % | 10.9 | % | 10.7 | % | 11.6 | % | 5.9 | % | 7.1 | % | 4.0 | % | 4.4 | % | 24.5 | % | ||||||||||||||||||||||
Leases | 148 | 415 | 417 | 420 | 435 | 337 | 184 | 193 | 120 | 106 | 294 | |||||||||||||||||||||||||||||||||
% of Leases | 4.8 | % | 13.5 | % | 13.6 | % | 13.7 | % | 14.2 | % | 11.0 | % | 6.0 | % | 6.3 | % | 3.9 | % | 3.5 | % | 9.5 | % | ||||||||||||||||||||||
(1) Excludes investments in unconsolidated entities, developments, land parcels, loans receivable and sub-leases. Investments classified as held for sale are included in the current year. | ||||||||||||||||||||||||||||||||||||||||||||
(2) The most recent monthly cash base rent annualized. Base rent does not include tenant recoveries or amortization of above and below market lease intangibles or other non-cash income. | ||||||||||||||||||||||||||||||||||||||||||||
Nine Months Ended | Change | ||||||||||||||
September 30, 2019 | September 30, 2018 | $ | % | ||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | $ | 316,129 | $ | 309,303 | $ | 6,826 | 2 | % | |||||||
Cash provided from (used in) operating activities | 1,209,900 | 1,211,148 | (1,248 | ) | — | % | |||||||||
Cash provided from (used in) investing activities | (1,058,325 | ) | (2,133,293 | ) | 1,074,968 | 50 | % | ||||||||
Cash provided from (used in) financing activities | (132,533 | ) | 899,559 | (1,032,092 | ) | -115 | % | ||||||||
Effect of foreign currency translation | (4,436 | ) | (5,432 | ) | 996 | 18 | % | ||||||||
Cash, cash equivalents and restricted cash at end of period | $ | 330,735 | $ | 281,285 | $ | 49,450 | 18 | % | |||||||
Nine Months Ended | Change | ||||||||||||||
September 30, 2019 | September 30, 2018 | $ | % | ||||||||||||
New development | $ | 258,113 | $ | 88,146 | $ | 169,967 | 193 | % | |||||||
Recurring capital expenditures, tenant improvements and lease commissions | 86,488 | 57,384 | 29,104 | 51 | % | ||||||||||
Renovations, redevelopments and other capital improvements | 119,925 | 116,251 | 3,674 | 3 | % | ||||||||||
Total | $ | 464,526 | $ | 261,781 | $ | 202,745 | 77 | % | |||||||
Payments Due by Period | ||||||||||||||||||||
Contractual Obligations | Total | 2019 | 2020-2021 | 2022-2023 | Thereafter | |||||||||||||||
Unsecured credit facility and commercial paper(1,2) | $ | 1,335,000 | $ | 835,000 | $ | — | $ | 500,000 | $ | — | ||||||||||
Senior unsecured notes and term credit facilities:(2) | ||||||||||||||||||||
U.S. Dollar senior unsecured notes | 7,600,000 | — | — | 1,100,000 | 6,500,000 | |||||||||||||||
Canadian Dollar senior unsecured notes(3) | 226,501 | — | 226,501 | — | — | |||||||||||||||
Pounds Sterling senior unsecured notes(3) | 1,292,025 | — | — | — | 1,292,025 | |||||||||||||||
U.S. Dollar term credit facility | 510,000 | — | — | 510,000 | — | |||||||||||||||
Canadian Dollar term credit facility(3) | 188,750 | — | — | 188,750 | — | |||||||||||||||
Secured debt:(2,3) | ||||||||||||||||||||
Consolidated | 2,639,015 | 256,322 | 541,763 | 682,997 | 1,157,933 | |||||||||||||||
Unconsolidated | 800,225 | 11,817 | 75,636 | 61,013 | 651,759 | |||||||||||||||
Contractual interest obligations:(4) | ||||||||||||||||||||
Unsecured credit facility and commercial paper | 54,389 | 4,012 | 28,787 | 21,590 | — | |||||||||||||||
Senior unsecured notes and term loans(3) | 4,070,524 | 124,827 | 791,836 | 768,216 | 2,385,645 | |||||||||||||||
Consolidated secured debt(3) | 414,543 | 23,972 | 152,966 | 102,246 | 135,359 | |||||||||||||||
Unconsolidated secured debt(3) | 206,939 | 7,565 | 55,418 | 51,529 | 92,427 | |||||||||||||||
Financing lease liabilities(5) | 192,414 | 2,511 | 17,908 | 77,405 | 94,590 | |||||||||||||||
Operating lease liabilities(5) | 1,189,326 | 5,040 | 39,654 | 37,153 | 1,107,479 | |||||||||||||||
Purchase obligations(6) | 469,967 | 111,914 | 310,941 | 47,112 | — | |||||||||||||||
Other long-term liabilities | 123 | 123 | — | — | — | |||||||||||||||
Total contractual obligations | $ | 21,189,741 | $ | 1,383,103 | $ | 2,241,410 | $ | 4,148,011 | $ | 13,417,217 | ||||||||||
(1) Relates to our unsecured credit facility and commercial paper with an aggregate commitment of $3,000,000,000. See Note 10 to our unaudited consolidated financial statements for additional information. | ||||||||||||||||||||
(2) Amounts represent principal amounts due and do not reflect unamortized premiums/discounts or other fair value adjustments as reflected on the balance sheet. | ||||||||||||||||||||
(3) Based on foreign currency exchange rates in effect as of balance sheet date. | ||||||||||||||||||||
(4) Based on variable interest rates in effect as of balance sheet date. | ||||||||||||||||||||
(5) See Note 6 to our unaudited consolidated financial statements for additional information. | ||||||||||||||||||||
(6) See Note 13 to our unaudited consolidated financial statements for additional information. | ||||||||||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | Amount | % | 2019 | 2018 | Amount | % | |||||||||||||||||||||||
Net income | $ | 647,932 | $ | 84,226 | $ | 563,706 | 669 | % | $ | 1,090,274 | $ | 705,054 | $ | 385,220 | 55 | % | ||||||||||||||
NICS | 589,876 | 64,384 | 525,492 | 816 | % | 1,008,108 | 656,487 | 351,621 | 54 | % | ||||||||||||||||||||
FFO | 352,378 | 285,272 | 67,106 | 24 | % | 1,100,782 | 1,017,217 | 83,565 | 8 | % | ||||||||||||||||||||
EBITDA | 1,061,688 | 467,148 | 594,540 | 127 | % | 2,286,403 | 1,802,072 | 484,331 | 27 | % | ||||||||||||||||||||
NOI | 610,545 | 579,222 | 31,323 | 5 | % | 1,830,962 | 1,676,883 | 154,079 | 9 | % | ||||||||||||||||||||
SSNOI | 440,759 | 437,628 | 3,131 | 0.7 | % | 1,217,372 | 1,210,808 | 6,564 | 0.5 | % | ||||||||||||||||||||
Per share data (fully diluted): | ||||||||||||||||||||||||||||||
NICS | $ | 1.45 | $ | 0.17 | $ | 1.28 | 753 | % | $ | 2.51 | $ | 1.76 | $ | 0.75 | 43 | % | ||||||||||||||
FFO | $ | 0.87 | $ | 0.76 | $ | 0.11 | 14 | % | $ | 2.74 | $ | 2.72 | $ | 0.02 | 1 | % | ||||||||||||||
Interest coverage ratio | 7.61 | x | 3.38 | x | 4.23 | x | 125 | % | 5.36 | x | 4.73 | x | 0.63 | x | 13 | % | ||||||||||||||
Fixed charge coverage ratio | 6.96 | x | 2.85 | x | 4.11 | x | 144 | % | 4.90 | x | 3.93 | x | 0.97 | x | 25 | % | ||||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
NOI | $ | 254,155 | $ | 265,846 | $ | (11,691 | ) | -4.4 | % | $ | 797,067 | $ | 730,577 | $ | 66,490 | 9.1 | % | |||||||||||||
Non SSNOI attributable to same store properties | (2,897 | ) | (1,323 | ) | (1,574 | ) | -119.0 | % | 1,061 | 938 | 123 | 13.1 | % | |||||||||||||||||
NOI attributable to non same store properties(1) | (32,688 | ) | (46,374 | ) | 13,686 | 29.5 | % | (242,615 | ) | (176,665 | ) | (65,950 | ) | -37.3 | % | |||||||||||||||
SSNOI(2) | $ | 218,570 | $ | 218,149 | $ | 421 | 0.2 | % | $ | 555,513 | $ | 554,850 | $ | 663 | 0.1 | % | ||||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||
Resident fees and services | $ | 834,121 | $ | 875,171 | $ | (41,050 | ) | -5 | % | $ | 2,616,491 | $ | 2,374,450 | $ | 242,041 | 10 | % | |||||||||||||
Interest income | — | 159 | (159 | ) | -100 | % | — | 416 | (416 | ) | -100 | % | ||||||||||||||||||
Other income | 1,375 | 1,175 | 200 | 17 | % | 6,920 | 3,973 | 2,947 | 74 | % | ||||||||||||||||||||
Total revenues | 835,496 | 876,505 | (41,009 | ) | -5 | % | 2,623,411 | 2,378,839 | 244,572 | 10 | % | |||||||||||||||||||
Property operating expenses | 581,341 | 610,659 | (29,318 | ) | -5 | % | 1,826,344 | 1,648,262 | 178,082 | 11 | % | |||||||||||||||||||
NOI(1) | 254,155 | 265,846 | (11,691 | ) | -4 | % | 797,067 | 730,577 | 66,490 | 9 | % | |||||||||||||||||||
Other expenses: | ||||||||||||||||||||||||||||||
Depreciation and amortization | 148,126 | 136,532 | 11,594 | 8 | % | 416,252 | 397,080 | 19,172 | 5 | % | ||||||||||||||||||||
Interest expense | 16,356 | 17,319 | (963 | ) | -6 | % | 52,179 | 51,225 | 954 | 2 | % | |||||||||||||||||||
Loss (gain) on extinguishment of debt, net | 1,450 | — | 1,450 | n/a | 1,450 | 110 | 1,340 | 1,218 | % | |||||||||||||||||||||
Impairment of assets | 2,599 | 562 | 2,037 | 362 | % | 2,599 | 5,075 | (2,476 | ) | -49 | % | |||||||||||||||||||
Other expenses | 4,274 | (811 | ) | 5,085 | 627 | % | 19,077 | 5,168 | 13,909 | 269 | % | |||||||||||||||||||
172,805 | 153,602 | 19,203 | 13 | % | 491,557 | 458,658 | 32,899 | 7 | % | |||||||||||||||||||||
Income (loss) from continuing operations before income taxes and other items | 81,350 | 112,244 | (30,894 | ) | -28 | % | 305,510 | 271,919 | 33,591 | 12 | % | |||||||||||||||||||
Income tax benefit (expense) | (2,554 | ) | 211 | (2,765 | ) | -1,310 | % | (2,798 | ) | (2,244 | ) | (554 | ) | -25 | % | |||||||||||||||
Income (loss) from unconsolidated entities | (3,859 | ) | (6,705 | ) | 2,846 | 42 | % | (37,892 | ) | (21,389 | ) | (16,503 | ) | -77 | % | |||||||||||||||
Gain (loss) on real estate dispositions, net | 519,203 | (1 | ) | 519,204 | n/a | 518,493 | 3 | 518,490 | n/a | |||||||||||||||||||||
Income from continuing operations | 594,140 | 105,749 | 488,391 | 462 | % | 783,313 | 248,289 | 535,024 | 215 | % | ||||||||||||||||||||
Net income (loss) | 594,140 | 105,749 | 488,391 | 462 | % | 783,313 | 248,289 | 535,024 | 215 | % | ||||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 46,849 | 405 | 46,444 | 11,468 | % | 50,826 | (1,259 | ) | 52,085 | 4,137 | % | |||||||||||||||||||
Net income (loss) attributable to common stockholders | $ | 547,291 | $ | 105,344 | $ | 441,947 | 420 | % | $ | 732,487 | $ | 249,548 | $ | 482,939 | 194 | % | ||||||||||||||
(1) See Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||
Location | Units | Commitment | Balance | Est. Completion | |||||||||
Wandsworth, UK | 97 | $ | 72,538 | $ | 57,955 | 1Q20 | |||||||
Taylor, PA | 113 | 14,272 | 10,314 | 1Q20 | |||||||||
Beavercreek, OH | 100 | 12,032 | 10,487 | 1Q20 | |||||||||
Potomac, MD | 120 | 56,720 | 17,337 | 4Q20 | |||||||||
Beckenham, UK | 100 | 57,957 | 27,239 | 3Q21 | |||||||||
530 | $ | 213,519 | 123,332 | ||||||||||
Toronto, ON | Project in planning stage | 42,466 | |||||||||||
Hendon, UK | Project in planning stage | 29,519 | |||||||||||
Barnet, UK | Project in planning stage | 25,717 | |||||||||||
Washington, DC | Project in planning stage | 17,361 | |||||||||||
Brookline, MA | Project in planning stage | 16,829 | |||||||||||
$ | 255,224 | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | September 30, 2019 | September 30, 2018 | |||||||||||||||||||||||||
Wtd. Avg. | Wtd. Avg. | Wtd. Avg. | Wtd. Avg. | |||||||||||||||||||||||||
Amount | Interest Rate | Amount | Interest Rate | Amount | Interest Rate | Amount | Interest Rate | |||||||||||||||||||||
Beginning balance | $ | 2,018,180 | 3.80 | % | $ | 1,909,415 | 3.73 | % | $ | 1,810,587 | 3.87 | % | $ | 1,988,700 | 3.66 | % | ||||||||||||
Debt issued | 22,885 | 3.95 | % | — | — | % | 318,854 | 3.51 | % | 44,606 | 3.38 | % | ||||||||||||||||
Debt assumed | — | — | % | — | — | % | 42,000 | 4.62 | % | 85,192 | 4.38 | % | ||||||||||||||||
Debt extinguished | (42,131 | ) | 4.15 | % | — | — | % | (193,604 | ) | 4.37 | % | (131,175 | ) | 4.85 | % | |||||||||||||
Debt transferred | (12,072 | ) | 3.89 | % | 35,830 | 3.84 | % | (12,072 | ) | 3.89 | % | 35,830 | 3.84 | % | ||||||||||||||
Principal payments | (10,556 | ) | 3.49 | % | (11,908 | ) | 3.64 | % | (32,987 | ) | 3.38 | % | (35,910 | ) | 3.58 | % | ||||||||||||
Foreign currency | (12,614 | ) | 3.34 | % | 18,204 | 3.33 | % | 30,914 | 3.21 | % | (35,702 | ) | 3.54 | % | ||||||||||||||
Ending balance | $ | 1,963,692 | 3.58 | % | $ | 1,951,541 | 3.76 | % | $ | 1,963,692 | 3.58 | % | $ | 1,951,541 | 3.76 | % | ||||||||||||
Monthly averages | $ | 1,980,216 | 3.67 | % | $ | 1,934,652 | 3.74 | % | $ | 1,955,651 | 3.76 | % | $ | 1,935,752 | 3.70 | % | ||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
NOI | $ | 230,685 | $ | 218,684 | $ | 12,001 | 5.5 | % | $ | 691,906 | $ | 665,706 | $ | 26,200 | 3.9 | % | ||||||||||||||
Non SSNOI attributable to same store properties | (7,270 | ) | (5,269 | ) | (2,001 | ) | -38.0 | % | (22,336 | ) | (19,738 | ) | (2,598 | ) | -13.2 | % | ||||||||||||||
NOI attributable to non same store properties(1) | (92,872 | ) | (84,468 | ) | (8,404 | ) | -9.9 | % | (279,290 | ) | (258,375 | ) | (20,915 | ) | -8.1 | % | ||||||||||||||
SSNOI(2) | $ | 130,543 | $ | 128,947 | $ | 1,596 | 1.2 | % | $ | 390,280 | $ | 387,593 | $ | 2,687 | 0.7 | % | ||||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||
Rental income | $ | 227,499 | $ | 203,039 | $ | 24,460 | 12 | % | $ | 681,893 | $ | 607,831 | $ | 74,062 | 12 | % | ||||||||||||||
Interest income | 15,279 | 14,378 | 901 | 6 | % | 47,343 | 42,176 | 5,167 | 12 | % | ||||||||||||||||||||
Other income | 1,829 | 1,693 | 136 | 8 | % | 4,370 | 16,282 | (11,912 | ) | -73 | % | |||||||||||||||||||
Total revenues | 244,607 | 219,110 | 25,497 | 12 | % | 733,606 | 666,289 | 67,317 | 10 | % | ||||||||||||||||||||
Property operating expenses | 13,922 | 426 | 13,496 | 3,168 | % | 41,700 | 583 | 41,117 | 7,053 | % | ||||||||||||||||||||
NOI(1) | 230,685 | 218,684 | 12,001 | 5 | % | 691,906 | 665,706 | 26,200 | 4 | % | ||||||||||||||||||||
Other expenses: | ||||||||||||||||||||||||||||||
Depreciation and amortization | 57,147 | 60,383 | (3,236 | ) | -5 | % | 174,551 | 171,724 | 2,827 | 2 | % | |||||||||||||||||||
Interest expense | 3,076 | 3,500 | (424 | ) | -12 | % | 9,741 | 10,742 | (1,001 | ) | -9 | % | ||||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | 1,244 | 8,991 | (7,747 | ) | -86 | % | 670 | (5,642 | ) | 6,312 | 112 | % | ||||||||||||||||||
Loss (gain) on extinguishment of debt, net | — | — | — | n/a | — | (32 | ) | 32 | 100 | % | ||||||||||||||||||||
Provision for loan losses | — | — | — | n/a | 18,690 | — | 18,690 | n/a | ||||||||||||||||||||||
Impairment of assets | 12,314 | 6,178 | 6,136 | 99 | % | 11,374 | 34,482 | (23,108 | ) | -67 | % | |||||||||||||||||||
Other expenses | (2,496 | ) | 87,076 | (89,572 | ) | -103 | % | 6,093 | 89,153 | (83,060 | ) | -93 | % | |||||||||||||||||
71,285 | 166,128 | (94,843 | ) | -57 | % | 221,119 | 300,427 | (79,308 | ) | -26 | % | |||||||||||||||||||
Income from continuing operations before income taxes and other items | 159,400 | 52,556 | 106,844 | 203 | % | 470,787 | 365,279 | 105,508 | 29 | % | ||||||||||||||||||||
Income tax (expense) benefit | 12 | 1,116 | (1,104 | ) | -99 | % | (2,300 | ) | (708 | ) | (1,592 | ) | -225 | % | ||||||||||||||||
Income (loss) from unconsolidated entities | 5,276 | 5,377 | (101 | ) | -2 | % | 17,512 | 16,260 | 1,252 | 8 | % | |||||||||||||||||||
Gain (loss) on real estate dispositions, net | 51,529 | 24,782 | 26,747 | 108 | % | 217,973 | 158,938 | 59,035 | 37 | % | ||||||||||||||||||||
Income from continuing operations | 216,217 | 83,831 | 132,386 | 158 | % | 703,972 | 539,769 | 164,203 | 30 | % | ||||||||||||||||||||
Net income | 216,217 | 83,831 | 132,386 | 158 | % | 703,972 | 539,769 | 164,203 | 30 | % | ||||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 9,096 | 6,913 | 2,183 | 32 | % | 27,422 | 10,129 | 17,293 | 171 | % | ||||||||||||||||||||
Net income attributable to common stockholders | $ | 207,121 | $ | 76,918 | $ | 130,203 | 169 | % | $ | 676,550 | $ | 529,640 | $ | 146,910 | 28 | % | ||||||||||||||
(1) See Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||
Location | Units/Beds | Commitment | Balance | Est. Completion | |||||||||
Union, KY | 162 | $ | 34,600 | $ | 20,557 | 1Q20 | |||||||
Westerville, OH | 90 | 22,800 | 17,049 | 1Q20 | |||||||||
Droitwich, UK | 70 | 15,584 | 8,787 | 2Q20 | |||||||||
Thousand Oaks, CA | 82 | 24,763 | 8,199 | 4Q20 | |||||||||
Leicester, UK | 60 | 13,782 | 3,247 | 1Q21 | |||||||||
464 | $ | 111,529 | $ | 57,839 | |||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | September 30, 2019 | September 30, 2018 | |||||||||||||||||||||||||
Wtd. Avg. | Wtd. Avg. | Wtd. Avg. | Wtd. Avg. | |||||||||||||||||||||||||
Amount | Interest Rate | Amount | Interest Rate | Amount | Interest Rate | Amount | Interest Rate | |||||||||||||||||||||
Beginning balance | $ | 287,952 | 3.63 | % | $ | 334,033 | 3.53 | % | $ | 288,386 | 3.63 | % | $ | 347,474 | 3.55 | % | ||||||||||||
Debt extinguished | — | — | % | — | — | % | — | — | % | (4,107 | ) | 4.94 | % | |||||||||||||||
Debt transferred | 12,072 | 3.89 | % | (35,830 | ) | 3.80 | % | 12,072 | 3.89 | % | (35,830 | ) | 3.84 | % | ||||||||||||||
Principal payments | (1,037 | ) | 5.17 | % | (962 | ) | 5.26 | % | (2,945 | ) | 5.22 | % | (3,033 | ) | 5.42 | % | ||||||||||||
Foreign currency | (5,986 | ) | 2.95 | % | (979 | ) | 3.51 | % | (4,512 | ) | 3.23 | % | (8,242 | ) | 3.29 | % | ||||||||||||
Ending balance | $ | 293,001 | 3.64 | % | $ | 296,262 | 3.63 | % | $ | 293,001 | 3.64 | % | $ | 296,262 | 3.63 | % | ||||||||||||
Monthly averages | $ | 291,300 | 3.64 | % | $ | 309,920 | 3.53 | % | $ | 291,475 | 3.63 | % | $ | 331,239 | 3.48 | % | ||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
NOI | $ | 124,864 | $ | 93,997 | $ | 30,867 | 32.8 | % | $ | 338,537 | $ | 279,039 | $ | 59,498 | 21.3 | % | ||||||||||||||
Non SSNOI on same store properties | (1,294 | ) | (1,806 | ) | 512 | 28.3 | % | (4,152 | ) | (4,517 | ) | 365 | 8.1 | % | ||||||||||||||||
NOI attributable to non same store properties(1) | (31,924 | ) | (1,659 | ) | (30,265 | ) | -1,824.3 | % | (62,806 | ) | (6,157 | ) | (56,649 | ) | -920.1 | % | ||||||||||||||
SSNOI(2) | $ | 91,646 | $ | 90,532 | $ | 1,114 | 1.2 | % | $ | 271,579 | $ | 268,365 | $ | 3,214 | 1.2 | % | ||||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||
Rental income | $ | 184,648 | $ | 139,848 | $ | 44,800 | 32 | % | $ | 496,924 | $ | 412,026 | $ | 84,898 | 21 | % | ||||||||||||||
Interest income | 358 | 85 | 273 | 321 | % | 769 | 140 | 629 | 449 | % | ||||||||||||||||||||
Other income | 183 | 136 | 47 | 35 | % | 322 | 401 | (79 | ) | -20 | % | |||||||||||||||||||
Total revenues | 185,189 | 140,069 | 45,120 | 32 | % | 498,015 | 412,567 | 85,448 | 21 | % | ||||||||||||||||||||
Property operating expenses | 60,325 | 46,072 | 14,253 | 31 | % | 159,478 | 133,528 | 25,950 | 19 | % | ||||||||||||||||||||
NOI(1) | 124,864 | 93,997 | 30,867 | 33 | % | 338,537 | 279,039 | 59,498 | 21 | % | ||||||||||||||||||||
Other expenses: | ||||||||||||||||||||||||||||||
Depreciation and amortization | 67,172 | 46,234 | 20,938 | 45 | % | 173,626 | 138,821 | 34,805 | 25 | % | ||||||||||||||||||||
Interest expense | 3,363 | 1,643 | 1,720 | 105 | % | 10,097 | 4,975 | 5,122 | 103 | % | ||||||||||||||||||||
Loss (gain) on extinguishment of debt, net | — | — | — | n/a | — | 11,928 | (11,928 | ) | -100 | % | ||||||||||||||||||||
Impairment of assets | 3,183 | — | 3,183 | n/a | 14,062 | — | 14,062 | n/a | ||||||||||||||||||||||
Other expenses | 524 | 1,055 | (531 | ) | -50 | % | 1,274 | 3,748 | (2,474 | ) | -66 | % | ||||||||||||||||||
74,242 | 48,932 | 25,310 | 52 | % | 199,059 | 159,472 | 39,587 | 25 | % | |||||||||||||||||||||
Income (loss) from continuing operations before income taxes and other items | 50,622 | 45,065 | 5,557 | 12 | % | 139,478 | 119,567 | 19,911 | 17 | % | ||||||||||||||||||||
Income tax (expense) benefit | (302 | ) | 239 | (541 | ) | -226 | % | (1,253 | ) | (567 | ) | (686 | ) | -121 | % | |||||||||||||||
Income from unconsolidated entities | 1,845 | 1,672 | 173 | 10 | % | 5,394 | 4,293 | 1,101 | 26 | % | ||||||||||||||||||||
Gain (loss) on real estate dispositions, net | (482 | ) | (58 | ) | (424 | ) | -731 | % | (489 | ) | 214,721 | (215,210 | ) | -100 | % | |||||||||||||||
Income from continuing operations | 51,683 | 46,918 | 4,765 | 10 | % | 143,130 | 338,014 | (194,884 | ) | -58 | % | |||||||||||||||||||
Net income (loss) | 51,683 | 46,918 | 4,765 | 10 | % | 143,130 | 338,014 | (194,884 | ) | -58 | % | |||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 2,111 | 848 | 1,263 | 149 | % | 3,918 | 4,669 | (751 | ) | -16 | % | |||||||||||||||||||
Net income (loss) attributable to common stockholders | $ | 49,572 | $ | 46,070 | $ | 3,502 | 8 | % | $ | 139,212 | $ | 333,345 | $ | (194,133 | ) | -58 | % | |||||||||||||
(1) See Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||
Location | Square Feet | Commitment | Balance | Est. Completion | |||||||||
Houston, TX | 73,500 | $ | 23,455 | $ | 16,126 | 4Q19 | |||||||
Porter, TX | 55,000 | 20,800 | 12,041 | 1Q20 | |||||||||
Lowell, MA | 50,668 | 8,700 | 6,559 | 1Q20 | |||||||||
Brooklyn, NY | 140,955 | 105,306 | 77,097 | 2Q20 | |||||||||
Katy, TX | 36,500 | 12,028 | 1,077 | 2Q20 | |||||||||
Total | 356,623 | $ | 170,289 | $ | 112,900 | ||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
September 30, 2019 | September 30, 2018 | September 30, 2019 | September 30, 2018 | |||||||||||||||||||||||||
Wtd. Ave | Wtd. Ave | Wtd. Ave | Wtd. Ave | |||||||||||||||||||||||||
Amount | Interest Rate | Amount | Interest Rate | Amount | Interest Rate | Amount | Interest Rate | |||||||||||||||||||||
Beginning balance | $ | 383,850 | 4.22 | % | $ | 217,007 | 4.35 | % | $ | 386,738 | 4.20 | % | $ | 279,951 | 4.72 | % | ||||||||||||
Debt assumed | — | — | % | 14,360 | 3.80 | % | — | — | % | 14,360 | 3.80 | % | ||||||||||||||||
Debt extinguished | — | — | % | — | — | % | — | — | % | (61,291 | ) | 7.43 | % | |||||||||||||||
Principal payments | (1,528 | ) | 4.97 | % | (702 | ) | 5.90 | % | (4,416 | ) | 5.03 | % | (2,355 | ) | 6.02 | % | ||||||||||||
Ending balance | $ | 382,322 | 4.09 | % | $ | 230,665 | 4.19 | % | $ | 382,322 | 4.09 | % | $ | 230,665 | 4.19 | % | ||||||||||||
Monthly averages | $ | 383,084 | 4.17 | % | $ | 220,246 | 4.22 | % | $ | 384,590 | 4.21 | % | $ | 224,943 | 4.26 | % | ||||||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||
Other income | $ | 841 | $ | 695 | $ | 146 | 21 | % | $ | 3,452 | $ | 1,561 | $ | 1,891 | 121 | % | ||||||||||||||
Total revenue | 841 | 695 | 146 | 21 | % | 3,452 | 1,561 | 1,891 | 121 | % | ||||||||||||||||||||
Expenses: | ||||||||||||||||||||||||||||||
Interest expense | 114,548 | 115,570 | (1,022 | ) | -1 | % | 351,894 | 315,281 | 36,613 | 12 | % | |||||||||||||||||||
General and administrative expenses | 31,019 | 28,746 | 2,273 | 8 | % | 100,042 | 95,282 | 4,760 | 5 | % | ||||||||||||||||||||
Loss (gain) on extinguishment of debt, net | 64,374 | 4,038 | 60,336 | 1,494 | % | 80,093 | 4,038 | 76,055 | 1,883 | % | ||||||||||||||||||||
Other expenses | 3,884 | 1,306 | 2,578 | 197 | % | 10,126 | 4,327 | 5,799 | 134 | % | ||||||||||||||||||||
213,825 | 149,660 | 64,165 | 43 | % | 542,155 | 418,928 | 123,227 | 29 | % | |||||||||||||||||||||
Loss from continuing operations before income taxes and other items | (212,984 | ) | (148,965 | ) | (64,019 | ) | -43 | % | (538,703 | ) | (417,367 | ) | (121,336 | ) | -29 | % | ||||||||||||||
Income tax (expense) benefit | (1,124 | ) | (3,307 | ) | 2,183 | 66 | % | (1,438 | ) | (3,651 | ) | 2,213 | 61 | % | ||||||||||||||||
Loss from continuing operations | (214,108 | ) | (152,272 | ) | (61,836 | ) | -41 | % | (540,141 | ) | (421,018 | ) | (119,123 | ) | -28 | % | ||||||||||||||
Less: Preferred stock dividends | — | 11,676 | (11,676 | ) | -100 | % | — | 35,028 | (35,028 | ) | -100 | % | ||||||||||||||||||
Net loss attributable to common stockholders | $ | (214,108 | ) | $ | (163,948 | ) | $ | (50,160 | ) | -31 | % | $ | (540,141 | ) | $ | (456,046 | ) | $ | (84,095 | ) | -18 | % | ||||||||
Three Months Ended | Change | Nine Months Ended | Change | |||||||||||||||||||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ | % | 2019 | 2018 | $ | % | |||||||||||||||||||||||
Senior unsecured notes | $ | 100,356 | $ | 99,445 | $ | 911 | 1 | % | $ | 307,587 | $ | 282,847 | $ | 24,740 | 9 | % | ||||||||||||||
Secured debt | — | 26 | (26 | ) | -100 | % | — | 96 | (96 | ) | -100 | % | ||||||||||||||||||
Unsecured revolving credit facility and commercial paper note program | 10,300 | 12,662 | (2,362 | ) | -19 | % | 32,978 | 22,442 | 10,536 | 47 | % | |||||||||||||||||||
Loan expense | 3,892 | 3,437 | 455 | 13 | % | 11,329 | 9,896 | 1,433 | 14 | % | ||||||||||||||||||||
Totals | $ | 114,548 | $ | 115,570 | $ | (1,022 | ) | -1 | % | $ | 351,894 | $ | 315,281 | $ | 36,613 | 12 | % | |||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||||||||
NOI Reconciliations: | 2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | |||||||||||||||||||||
Net income (loss) | $ | 453,555 | $ | 167,273 | $ | 84,226 | $ | 124,696 | $ | 292,302 | $ | 150,040 | $ | 647,932 | ||||||||||||||
Loss (gain) on real estate dispositions, net | (338,184 | ) | (10,755 | ) | (24,723 | ) | (41,913 | ) | (167,409 | ) | 1,682 | (570,250 | ) | |||||||||||||||
Loss (income) from unconsolidated entities | 2,429 | (1,249 | ) | (344 | ) | (195 | ) | 9,199 | 9,049 | (3,262 | ) | |||||||||||||||||
Income tax expense (benefit) | 1,588 | 3,841 | 1,741 | 1,504 | 2,222 | 1,599 | 3,968 | |||||||||||||||||||||
Other expenses | 3,712 | 10,058 | 88,626 | 10,502 | 8,756 | 21,628 | 6,186 | |||||||||||||||||||||
Impairment of assets | 28,185 | 4,632 | 6,740 | 76,022 | — | 9,939 | 18,096 | |||||||||||||||||||||
Provision for loan losses | — | — | — | — | 18,690 | — | — | |||||||||||||||||||||
Loss (gain) on extinguishment of debt, net | 11,707 | 299 | 4,038 | 53 | 15,719 | — | 65,824 | |||||||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | (7,173 | ) | (7,460 | ) | 8,991 | 1,626 | (2,487 | ) | 1,913 | 1,244 | ||||||||||||||||||
General and administrative expenses | 33,705 | 32,831 | 28,746 | 31,101 | 35,282 | 33,741 | 31,019 | |||||||||||||||||||||
Depreciation and amortization | 228,201 | 236,275 | 243,149 | 242,834 | 243,932 | 248,052 | 272,445 | |||||||||||||||||||||
Interest expense | 122,775 | 121,416 | 138,032 | 144,369 | 145,232 | 141,336 | 137,343 | |||||||||||||||||||||
Consolidated net operating income (NOI) | $ | 540,500 | $ | 557,161 | $ | 579,222 | $ | 590,599 | $ | 601,438 | $ | 618,979 | $ | 610,545 | ||||||||||||||
NOI by segment: | ||||||||||||||||||||||||||||
Seniors Housing Operating | $ | 225,226 | $ | 239,505 | $ | 265,846 | $ | 254,445 | $ | 264,700 | $ | 278,212 | $ | 254,155 | ||||||||||||||
Triple-net | 222,738 | 224,284 | 218,684 | 234,343 | 233,286 | 227,935 | 230,685 | |||||||||||||||||||||
Outpatient Medical | 92,168 | 92,874 | 93,997 | 101,097 | 101,295 | 112,378 | 124,864 | |||||||||||||||||||||
Non-segment/corporate | 368 | 498 | 695 | 714 | 2,157 | 454 | 841 | |||||||||||||||||||||
Total NOI | $ | 540,500 | $ | 557,161 | $ | 579,222 | $ | 590,599 | $ | 601,438 | $ | 618,979 | $ | 610,545 | ||||||||||||||
Nine Months Ended | ||||||||
September 30, 2018 | September 30, 2019 | |||||||
NOI Reconciliations: | ||||||||
Net income (loss) | $ | 705,054 | $ | 1,090,274 | ||||
Loss (gain) on real estate dispositions, net | (373,662 | ) | (735,977 | ) | ||||
Loss (income) from unconsolidated entities | 836 | 14,986 | ||||||
Income tax expense (benefit) | 7,170 | 7,789 | ||||||
Other expenses | 102,396 | 36,570 | ||||||
Impairment of assets | 39,557 | 28,035 | ||||||
Provision for loan losses | — | 18,690 | ||||||
Loss (gain) on extinguishment of debt, net | 16,044 | 81,543 | ||||||
Loss (gain) on derivatives and financial instruments, net | (5,642 | ) | 670 | |||||
General and administrative expenses | 95,282 | 100,042 | ||||||
Depreciation and amortization | 707,625 | 764,429 | ||||||
Interest expense | 382,223 | 423,911 | ||||||
Consolidated net operating income (NOI) | $ | 1,676,883 | $ | 1,830,962 | ||||
NOI by segment: | ||||||||
Seniors Housing Operating | $ | 730,577 | $ | 797,067 | ||||
Triple-net | 665,706 | 691,906 | ||||||
Outpatient Medical | 279,039 | 338,537 | ||||||
Non-segment/corporate | 1,561 | 3,452 | ||||||
Total NOI | $ | 1,676,883 | $ | 1,830,962 | ||||
Three Months Ended | Nine Months Ended | |||||||||||||||
SSNOI Reconciliations: | September 30, 2018 | September 30, 2019 | September 30, 2018 | September 30, 2019 | ||||||||||||
NOI: | ||||||||||||||||
Seniors Housing Operating | $ | 265,846 | $ | 254,155 | $ | 730,577 | $ | 797,067 | ||||||||
Triple-net | 218,684 | 230,685 | 665,706 | 691,906 | ||||||||||||
Outpatient Medical | 93,997 | 124,864 | 279,039 | 338,537 | ||||||||||||
Total | 578,527 | 609,704 | 1,675,322 | 1,827,510 | ||||||||||||
Adjustments: | ||||||||||||||||
Seniors Housing Operating: | ||||||||||||||||
Non SSNOI on same store properties | (1,323 | ) | (2,897 | ) | 938 | 1,061 | ||||||||||
NOI attributable to non same store properties | (46,374 | ) | (32,688 | ) | (176,665 | ) | (242,615 | ) | ||||||||
Subtotal | (47,697 | ) | (35,585 | ) | (175,727 | ) | (241,554 | ) | ||||||||
Triple-net: | ||||||||||||||||
Non SSNOI on same store properties | (5,269 | ) | (7,270 | ) | (19,738 | ) | (22,336 | ) | ||||||||
NOI attributable to non same store properties | (84,468 | ) | (92,872 | ) | (258,375 | ) | (279,290 | ) | ||||||||
Subtotal | (89,737 | ) | (100,142 | ) | (278,113 | ) | (301,626 | ) | ||||||||
Outpatient Medical: | ||||||||||||||||
Non SSNOI on same store properties | (1,806 | ) | (1,294 | ) | (4,517 | ) | (4,152 | ) | ||||||||
NOI attributable to non same store properties | (1,659 | ) | (31,924 | ) | (6,157 | ) | (62,806 | ) | ||||||||
Subtotal | (3,465 | ) | (33,218 | ) | (10,674 | ) | (66,958 | ) | ||||||||
SSNOI: | ||||||||||||||||
Seniors Housing Operating | 218,149 | 218,570 | 554,850 | 555,513 | ||||||||||||
Triple-net | 128,947 | 130,543 | 387,593 | 390,280 | ||||||||||||
Outpatient Medical | 90,532 | 91,646 | 268,365 | 271,579 | ||||||||||||
Total | $ | 437,628 | $ | 440,759 | $ | 1,210,808 | $ | 1,217,372 | ||||||||
Three Months Ended September 30, 2019 | Nine Months Ended September 30, 2019 | |||||||||||||||||||||||
SSNOI Property Reconciliations: | Seniors Housing Operating | Triple-net | Outpatient Medical | Total | Seniors Housing Operating | Triple-net | Outpatient Medical | Total | ||||||||||||||||
Total properties | 524 | 657 | 358 | 1,539 | 524 | 657 | 358 | 1,539 | ||||||||||||||||
Recent acquisitions/development conversions | (52 | ) | (236 | ) | (103 | ) | (391 | ) | (66 | ) | (236 | ) | (107 | ) | (409 | ) | ||||||||
Developments | (11 | ) | (5 | ) | (5 | ) | (21 | ) | (11 | ) | (5 | ) | (5 | ) | (21 | ) | ||||||||
Held for sale | (12 | ) | (8 | ) | (5 | ) | (25 | ) | (12 | ) | (8 | ) | (5 | ) | (25 | ) | ||||||||
Segment transitions | (36 | ) | (17 | ) | — | (53 | ) | (84 | ) | (17 | ) | — | (101 | ) | ||||||||||
Other(1) | — | (20 | ) | (6 | ) | (26 | ) | — | (20 | ) | (6 | ) | (26 | ) | ||||||||||
Same store properties | 413 | 371 | 239 | 1,023 | 351 | 371 | 235 | 957 | ||||||||||||||||
(1) Includes eight land parcels, eight subleases and ten loans. | ||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||||||||
FFO Reconciliations: | 2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | |||||||||||||||||||||
Net income attributable to common stockholders | $ | 437,671 | $ | 154,432 | $ | 64,384 | $ | 101,763 | $ | 280,470 | $ | 137,762 | $ | 589,876 | ||||||||||||||
Depreciation and amortization | 228,201 | 236,275 | 243,149 | 242,834 | 243,932 | 248,052 | 272,445 | |||||||||||||||||||||
Impairment of assets | 28,185 | 4,632 | 6,740 | 76,022 | — | 9,939 | 18,096 | |||||||||||||||||||||
Loss (gain) on real estate dispositions, net | (338,184 | ) | (10,755 | ) | (24,723 | ) | (41,913 | ) | (167,409 | ) | 1,682 | (570,250 | ) | |||||||||||||||
Noncontrolling interests | (16,353 | ) | (17,692 | ) | (17,498 | ) | (17,650 | ) | (17,760 | ) | (18,889 | ) | 31,347 | |||||||||||||||
Unconsolidated entities | 13,700 | 11,833 | 13,220 | 13,910 | 19,150 | 11,475 | 10,864 | |||||||||||||||||||||
FFO | $ | 353,220 | $ | 378,725 | $ | 285,272 | $ | 374,966 | $ | 358,383 | $ | 390,021 | $ | 352,378 | ||||||||||||||
Average diluted shares outstanding | 373,257 | 373,075 | 374,487 | 380,002 | 393,452 | 406,673 | 406,891 | |||||||||||||||||||||
Per diluted share data: | ||||||||||||||||||||||||||||
Net income attributable to common stockholders | $ | 1.17 | $ | 0.41 | $ | 0.17 | $ | 0.27 | $ | 0.71 | $ | 0.34 | $ | 1.45 | ||||||||||||||
FFO | $ | 0.95 | $ | 1.02 | $ | 0.76 | $ | 0.99 | $ | 0.91 | $ | 0.96 | $ | 0.87 | ||||||||||||||
Nine Months Ended | ||||||||
September 30, | September 30, | |||||||
FFO Reconciliations: | 2018 | 2019 | ||||||
Net income attributable to common stockholders | $ | 656,487 | $ | 1,008,108 | ||||
Depreciation and amortization | 707,625 | 764,429 | ||||||
Impairment of assets | 39,557 | 28,035 | ||||||
Loss (gain) on real estate dispositions, net | (373,662 | ) | (735,977 | ) | ||||
Noncontrolling interests | (51,543 | ) | (5,302 | ) | ||||
Unconsolidated entities | 38,753 | 41,489 | ||||||
FFO | $ | 1,017,217 | $ | 1,100,782 | ||||
Average diluted common shares outstanding: | 373,638 | 402,412 | ||||||
Per diluted share data: | ||||||||
Net income attributable to common stockholders | $ | 1.76 | $ | 2.51 | ||||
FFO | $ | 2.72 | $ | 2.74 | ||||
Three Months Ended | ||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||||||||
EBITDA Reconciliations: | 2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | |||||||||||||||||||||
Net income (loss) | $ | 453,555 | $ | 167,273 | $ | 84,226 | $ | 124,696 | $ | 292,302 | $ | 150,040 | $ | 647,932 | ||||||||||||||
Interest expense | 122,775 | 121,416 | 138,032 | 144,369 | 145,232 | 141,336 | 137,343 | |||||||||||||||||||||
Income tax expense (benefit) | 1,588 | 3,841 | 1,741 | 1,504 | 2,222 | 1,599 | 3,968 | |||||||||||||||||||||
Depreciation and amortization | 228,201 | 236,275 | 243,149 | 242,834 | 243,932 | 248,052 | 272,445 | |||||||||||||||||||||
EBITDA | $ | 806,119 | $ | 528,805 | $ | 467,148 | $ | 513,403 | $ | 683,688 | $ | 541,027 | $ | 1,061,688 | ||||||||||||||
Interest Coverage Ratio: | ||||||||||||||||||||||||||||
Interest expense | $ | 122,775 | $ | 121,416 | $ | 138,032 | $ | 144,369 | $ | 145,232 | $ | 141,336 | $ | 137,343 | ||||||||||||||
Non-cash interest expense | (4,179 | ) | (1,716 | ) | (1,658 | ) | (3,307 | ) | (5,171 | ) | (752 | ) | (1,988 | ) | ||||||||||||||
Capitalized interest | 2,336 | 2,100 | 1,921 | 1,548 | 2,327 | 3,929 | 4,148 | |||||||||||||||||||||
Total interest | 120,932 | 121,800 | 138,295 | 142,610 | 142,388 | 144,513 | 139,503 | |||||||||||||||||||||
EBITDA | $ | 806,119 | $ | 528,805 | $ | 467,148 | $ | 513,403 | $ | 683,688 | $ | 541,027 | $ | 1,061,688 | ||||||||||||||
Interest coverage ratio | 6.67 | x | 4.34 | x | 3.38 | x | 3.60 | x | 4.80 | x | 3.74 | x | 7.61 | x | ||||||||||||||
Fixed Charge Coverage Ratio: | ||||||||||||||||||||||||||||
Total interest | $ | 120,932 | $ | 121,800 | $ | 138,295 | $ | 142,610 | $ | 142,388 | $ | 144,513 | $ | 139,503 | ||||||||||||||
Secured debt principal payments | 14,247 | 14,139 | 13,908 | 13,994 | 13,543 | 13,684 | 13,121 | |||||||||||||||||||||
Preferred dividends | 11,676 | 11,676 | 11,676 | 11,676 | — | — | — | |||||||||||||||||||||
Total fixed charges | 146,855 | 147,615 | 163,879 | 168,280 | 155,931 | 158,197 | 152,624 | |||||||||||||||||||||
EBITDA | $ | 806,119 | $ | 528,805 | $ | 467,148 | $ | 513,403 | $ | 683,688 | $ | 541,027 | $ | 1,061,688 | ||||||||||||||
Fixed charge coverage ratio | 5.49 | x | 3.58 | x | 2.85 | x | 3.05 | x | 4.38 | x | 3.42 | x | 6.96 | x | ||||||||||||||
Nine Months Ended | ||||||||
September 30, | September 30, | |||||||
EBITDA Reconciliations: | 2018 | 2019 | ||||||
Net income (loss) | $ | 705,054 | $ | 1,090,274 | ||||
Interest expense | 382,223 | 423,911 | ||||||
Income tax expense (benefit) | 7,170 | 7,789 | ||||||
Depreciation and amortization | 707,625 | 764,429 | ||||||
EBITDA | $ | 1,802,072 | $ | 2,286,403 | ||||
Interest Coverage Ratio: | ||||||||
Interest expense | $ | 382,223 | $ | 423,911 | ||||
Non-cash interest expense | (7,553 | ) | (7,911 | ) | ||||
Capitalized interest | 6,357 | 10,404 | ||||||
Total interest | 381,027 | 426,404 | ||||||
EBITDA | $ | 1,802,072 | $ | 2,286,403 | ||||
Interest coverage ratio | 4.73 | x | 5.36 | x | ||||
Fixed Charge Coverage Ratio: | ||||||||
Total interest | $ | 381,027 | $ | 426,404 | ||||
Secured debt principal payments | 42,294 | 40,348 | ||||||
Preferred dividends | 35,028 | — | ||||||
Total fixed charges | 458,349 | 466,752 | ||||||
EBITDA | $ | 1,802,072 | $ | 2,286,403 | ||||
Fixed charge coverage ratio | 3.93 | x | 4.90 | x | ||||
Twelve Months Ended | ||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||||||||
Adjusted EBITDA Reconciliations: | 2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | |||||||||||||||||||||
Net income | $ | 656,551 | $ | 620,384 | $ | 615,311 | $ | 829,750 | $ | 668,497 | $ | 651,264 | $ | 1,214,970 | ||||||||||||||
Interest expense | 488,800 | 493,986 | 509,440 | 526,592 | 549,049 | 568,969 | 568,280 | |||||||||||||||||||||
Income tax expense (benefit) | 19,471 | 31,761 | 32,833 | 8,674 | 9,308 | 7,066 | 9,293 | |||||||||||||||||||||
Depreciation and amortization | 921,645 | 933,072 | 946,083 | 950,459 | 966,190 | 977,967 | 1,007,263 | |||||||||||||||||||||
EBITDA | 2,086,467 | 2,079,203 | 2,103,667 | 2,315,475 | 2,193,044 | 2,205,266 | 2,799,806 | |||||||||||||||||||||
Loss (income) from unconsolidated entities | 62,448 | 57,221 | 60,285 | 641 | 7,411 | 17,709 | 14,791 | |||||||||||||||||||||
Stock-based compensation expense(1) | 25,753 | 26,158 | 25,443 | 27,646 | 23,618 | 26,113 | 25,347 | |||||||||||||||||||||
Loss (gain) on extinguishment of debt, net | 17,593 | 12,377 | 16,415 | 16,097 | 20,109 | 19,810 | 81,596 | |||||||||||||||||||||
Loss (gain) on real estate dispositions, net | (438,342 | ) | (406,942 | ) | (430,043 | ) | (415,575 | ) | (244,800 | ) | (232,363 | ) | (777,890 | ) | ||||||||||||||
Impairment of assets | 141,637 | 132,638 | 139,378 | 115,579 | 87,394 | 92,701 | 104,057 | |||||||||||||||||||||
Provision for loan losses | 62,966 | 62,966 | 62,966 | — | 18,690 | 18,690 | 18,690 | |||||||||||||||||||||
Loss (gain) on derivatives and financial instruments, net | (6,113 | ) | (14,309 | ) | (5,642 | ) | (4,016 | ) | 670 | 10,043 | 2,296 | |||||||||||||||||
Other expenses(1) | 167,524 | 171,243 | 161,655 | 111,990 | 117,942 | 126,994 | 45,512 | |||||||||||||||||||||
Additional other income | — | (10,805 | ) | (10,805 | ) | (14,832 | ) | (14,832 | ) | (4,027 | ) | (4,027 | ) | |||||||||||||||
Adjusted EBITDA | $ | 2,119,933 | $ | 2,109,750 | $ | 2,123,319 | $ | 2,153,005 | $ | 2,209,246 | $ | 2,280,936 | $ | 2,310,178 | ||||||||||||||
Adjusted Fixed Charge Coverage Ratio: | ||||||||||||||||||||||||||||
Interest expense | $ | 488,800 | $ | 493,986 | $ | 509,440 | $ | 526,592 | $ | 549,049 | $ | 568,969 | $ | 568,280 | ||||||||||||||
Capitalized interest | 11,696 | 10,437 | 9,813 | 7,905 | 7,896 | 9,725 | 11,952 | |||||||||||||||||||||
Non-cash interest expense | (12,858 | ) | (11,628 | ) | (10,087 | ) | (10,860 | ) | (11,852 | ) | (10,888 | ) | (11,218 | ) | ||||||||||||||
Total interest | 487,638 | 492,795 | 509,166 | 523,637 | 545,093 | 567,806 | 569,014 | |||||||||||||||||||||
Adjusted EBITDA | $ | 2,119,933 | $ | 2,109,750 | $ | 2,123,319 | $ | 2,153,005 | $ | 2,209,246 | $ | 2,280,936 | $ | 2,310,178 | ||||||||||||||
Adjusted interest coverage ratio | 4.35 | x | 4.28 | x | 4.17 | x | 4.11 | x | 4.05 | x | 4.02 | x | 4.06 | x | ||||||||||||||
Total interest | $ | 487,638 | $ | 492,795 | $ | 509,166 | $ | 523,637 | $ | 545,093 | $ | 567,806 | $ | 569,014 | ||||||||||||||
Secured debt principal payments | 62,077 | 60,258 | 58,866 | 56,288 | 55,584 | 55,129 | 54,342 | |||||||||||||||||||||
Preferred dividends | 46,707 | 46,704 | 46,704 | 46,704 | 35,028 | 23,352 | 11,676 | |||||||||||||||||||||
Total fixed charges | 596,422 | 599,757 | 614,736 | 626,629 | 635,705 | 646,287 | 635,032 | |||||||||||||||||||||
Adjusted EBITDA | $ | 2,119,933 | $ | 2,109,750 | $ | 2,123,319 | $ | 2,153,005 | $ | 2,209,246 | $ | 2,280,936 | $ | 2,310,178 | ||||||||||||||
Adjusted fixed charge coverage ratio | 3.55 | x | 3.52 | x | 3.45 | x | 3.44 | x | 3.48 | x | 3.53 | x | 3.64 | x | ||||||||||||||
(1) Certain severance-related costs are included in stock-based compensation and excluded from other expenses. | ||||||||||||||||||||||||||||
As of | ||||||||||||||||||||||||||||
March 31, | June 30, | September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||||||||
2018 | 2018 | 2018 | 2018 | 2019 | 2019 | 2019 | ||||||||||||||||||||||
Book capitalization: | ||||||||||||||||||||||||||||
Unsecured credit facility and commercial paper | $ | 865,000 | $ | 540,000 | $ | 1,312,000 | $ | 1,147,000 | $ | 419,293 | $ | 1,869,188 | $ | 1,334,586 | ||||||||||||||
Long-term debt obligations(1) | 10,484,840 | 10,895,559 | 12,192,060 | 12,150,144 | 12,371,729 | 13,390,344 | 12,463,680 | |||||||||||||||||||||
Cash & cash equivalents(2) | (202,824 | ) | (215,120 | ) | (191,199 | ) | (215,376 | ) | (249,127 | ) | (268,666 | ) | (265,788 | ) | ||||||||||||||
Total net debt | 11,147,016 | 11,220,439 | 13,312,861 | 13,081,768 | 12,541,895 | 14,990,866 | 13,532,478 | |||||||||||||||||||||
Total equity and noncontrolling interests(3) | 15,448,201 | 15,198,644 | 15,670,065 | 16,010,645 | 16,498,376 | 16,452,806 | 16,696,070 | |||||||||||||||||||||
Book capitalization | $ | 26,595,217 | $ | 26,419,083 | $ | 28,982,926 | $ | 29,092,413 | $ | 29,040,271 | $ | 31,443,672 | $ | 30,228,548 | ||||||||||||||
Net debt to book capitalization ratio | 42 | % | 42 | % | 46 | % | 45 | % | 43 | % | 48 | % | 45 | % | ||||||||||||||
Undepreciated book capitalization: | ||||||||||||||||||||||||||||
Total net debt | $ | 11,147,016 | $ | 11,220,439 | $ | 13,312,861 | $ | 13,081,768 | $ | 12,541,895 | $ | 14,990,866 | $ | 13,532,478 | ||||||||||||||
Accumulated depreciation and amortization | 4,990,780 | 5,113,928 | 5,394,274 | 5,499,958 | 5,670,111 | 5,539,435 | 5,769,843 | |||||||||||||||||||||
Total equity and noncontrolling interests(3) | 15,448,201 | 15,198,644 | 15,670,065 | 16,010,645 | 16,498,376 | 16,452,806 | 16,696,070 | |||||||||||||||||||||
Undepreciated book capitalization | $ | 31,585,997 | $ | 31,533,011 | $ | 34,377,200 | $ | 34,592,371 | $ | 34,710,382 | $ | 36,983,107 | $ | 35,998,391 | ||||||||||||||
Net debt to undepreciated book capitalization ratio | 35 | % | 36 | % | 39 | % | 38 | % | 36 | % | 41 | % | 38 | % | ||||||||||||||
Market capitalization: | ||||||||||||||||||||||||||||
Common shares outstanding | 371,971 | 372,030 | 375,577 | 383,675 | 403,740 | 405,254 | 405,758 | |||||||||||||||||||||
Period end share price | $ | 54.43 | $ | 62.69 | $ | 64.32 | $ | 69.41 | $ | 77.60 | $ | 81.53 | $ | 90.65 | ||||||||||||||
Common equity market capitalization | $ | 20,246,382 | $ | 23,322,561 | $ | 24,157,113 | $ | 26,630,882 | $ | 31,330,224 | $ | 33,040,359 | $ | 36,781,963 | ||||||||||||||
Total net debt | 11,147,016 | 11,220,439 | 13,312,861 | 13,081,768 | 12,541,895 | 14,990,866 | 13,532,478 | |||||||||||||||||||||
Noncontrolling interests(3) | 889,766 | 856,721 | 1,362,380 | 1,378,311 | 1,419,885 | 1,458,351 | 1,430,005 | |||||||||||||||||||||
Preferred stock | 718,498 | 718,498 | 718,498 | 718,498 | — | — | — | |||||||||||||||||||||
Enterprise value | $ | 33,001,662 | $ | 36,118,219 | $ | 39,550,852 | $ | 41,809,459 | $ | 45,292,004 | $ | 49,489,576 | $ | 51,744,446 | ||||||||||||||
Net debt to market capitalization ratio | 34 | % | 31 | % | 34 | % | 31 | % | 28 | % | 30 | % | 26 | % | ||||||||||||||
(1) Amounts include senior unsecured notes, secured debt and lease liabilities related to financing leases, as reflected on our Consolidated Balance Sheet. Operating lease liabilities related to the ASC 842 adoption are excluded. | ||||||||||||||||||||||||||||
(2) Inclusive of IRC Section 1031 deposits, if any. | ||||||||||||||||||||||||||||
(3) Includes amounts attributable to both redeemable noncontrolling interests and noncontrolling interests as reflected on our Consolidated Balance Sheet. | ||||||||||||||||||||||||||||
• | the nature of the estimates or assumptions is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change; and |
• | the impact of the estimates and assumptions on financial condition or operating performance is material. |
September 30, 2019 | December 31, 2018 | |||||||||||||||
Principal | Change in | Principal | Change in | |||||||||||||
balance | fair value | balance | fair value | |||||||||||||
Senior unsecured notes | $ | 9,118,526 | $ | (706,397 | ) | $ | 9,009,159 | $ | (548,558 | ) | ||||||
Secured debt | 1,484,713 | (56,110 | ) | 1,639,983 | (59,522 | ) | ||||||||||
Totals | $ | 10,603,239 | $ | (762,507 | ) | $ | 10,649,142 | $ | (608,080 | ) | ||||||
September 30, 2019 | December 31, 2018 | |||||||||||||||
Carrying | Change in | Carrying | Change in | |||||||||||||
Value | fair value | Value | fair value | |||||||||||||
Foreign currency forward contracts | $ | 116,853 | $ | 10,663 | $ | 23,620 | $ | 16,163 | ||||||||
Debt designated as hedges | 1,480,775 | 14,808 | 1,559,159 | 15,592 | ||||||||||||
Totals | $ | 1,597,628 | $ | 25,471 | $ | 1,582,779 | $ | 31,755 | ||||||||
Issuer Purchases of Equity Securities | |||||||||||
Period | Total Number of Shares Purchased(1) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2) | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs | |||||||
July 1, 2019 through July 31, 2019 | — | $ | — | ||||||||
August 1, 2019 through August 31, 2019 | 42,138 | 81.77 | |||||||||
September 1, 2019 through September 30, 2019 | 15,267 | 88.81 | |||||||||
Totals | 57,405 | $ | 83.64 | ||||||||
4.1 | |||
10.1 | |||
10.2 | |||
31.1 | |||
31.2 | |||
32.1 | |||
32.2 | |||
101.INS | XBRL Instance Document. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | ||
101.SCH | XBRL Taxonomy Extension Schema Document | ||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | ||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | ||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | ||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | ||
104 | The cover page from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, formatted in Inline XBRL | ||
* | Management contract or Compensatory Plan or Arrangement. | ||
WELLTOWER INC. | |||||
Date: | October 30, 2019 | By: | /s/ THOMAS J. DEROSA | ||
Thomas J. DeRosa, | |||||
Chairman and Chief Executive Officer (Principal Executive Officer) | |||||
Date: | October 30, 2019 | By: | /s/ TIMOTHY G. MCHUGH | ||
Timothy G. McHugh, | |||||
Senior Vice President & Chief Financial Officer (Principal Financial Officer) | |||||
Date: | October 30, 2019 | By: | /s/ JOSHUA T. FIEWEGER | ||
Joshua T. Fieweger, | |||||
Senior Vice President & Controller (Principal Accounting Officer) | |||||
(1) | WELLTOWER INC., of 4500 Dorr Street, Toledo, Ohio 43615 (“Welltower” or “the Company”); and |
(2) | JOHN GOODEY, whose address is Springfield Nurseries, Bekesbourne Lane, Bekesbourne, England CT4 5DX (“Mr Goodey” or “you”). |
(A) | Mr Goodey was initially employed by HCN Management Services Limited as Senior Vice President – International, based in the United Kingdom under a contract of employment dated 6 May 2014 (the “Original Employment Contract”). The Original Employment Contract was amended and assigned to Welltower with effect from 3 October 2017 in connection with Mr Goodey’s promotion to Executive Vice President and Chief Financial Officer of Welltower, by means of a Deed of Assignment and Amendment dated 6 December 2017 (the “Assigned and Amended Employment Contract”). |
(B) | So as to better perform his duties as Executive Vice President and Chief Financial Officer of Welltower, Mr Goodey relocated from the United Kingdom to the United States of America on 1 November 2018 and continued to perform his duties for Welltower under the terms of a letter agreement dated 31 October 2018 (the “Letter Agreement”). In accordance with the terms of the Letter Agreement, Mr Goodey’s rights under the Original Employment Agreement as amended and assigned under the Assigned and Amended Employment Contract terminated with effect from close of business on 31 October 2018. |
(C) | On 4 September 2019 (the “Effective Date”), Mr Goodey stepped down from his role as Executive Vice President and Chief Financial Officer of Welltower following his return to the United Kingdom and his employment with Welltower will terminate in accordance with the terms of this Agreement on 20 September 2019 (the “Termination Date”). |
(D) | Welltower is entering into this Agreement for itself and as agent for and trustee of all its Group Companies. |
(E) | Mr Goodey is entering into this Agreement on 4 September 2019 having received independent legal advice from the Adviser a qualified lawyer as such term is defined in Section 203 of the Employment Rights Act 1996 as to the terms and effect of this Agreement and is aware that he has those potential claims against Welltower which are listed and have been raised in clause 6. |
1. | DEFINITIONS |
1.1 | In this Agreement the following terms shall have the meanings set out below: |
1.2 | The headings in this Agreement are inserted for convenience only and shall not affect its construction. |
1.3 | A reference to a particular law is a reference to it as it is in force for the time being taking account of any amendment, extension, or re-enactment and includes any subordinate legislation for the time being in force made under it. |
1.4 | Unless the context otherwise requires, a reference to one gender includes a reference to other genders. |
1.5 | Unless the context otherwise requires, words in the singular include the plural and in the plural include the singular. |
1.6 | The schedules to this Agreement form part of (and are incorporated into) this Agreement. |
2. | TERMINATION OF EMPLOYMENT AND DIRECTORSHIPS |
2.1 | With effect from the Effective Date, Mr Goodey will cease to serve as Welltower’s Chief Financial Officer and as an Executive Vice President of Welltower. Mr Goodey will carry out such reasonable handover duties as are specifically requested by Welltower’s Chief Executive Officer or new Chief Financial Officer but shall not undertake any other duties or enter into any premises of any Group Company. Mr Goodey will continue to receive his salary and other contractual benefits under the Letter Agreement up to and including the Termination Date but shall not be entitled to receive any sums in respect of bonus, save as set out in this Agreement. Following the Effective Date, Mr Goodey shall not incur any business related expenses save to the extent reasonable and necessary in order to carry out handover duties specifically requested by Welltower’s Chief Executive Officer or new Chief Financial Officer. |
2.2 | The parties hereby acknowledge and agree that Mr Goodey’s employment with Welltower under the Letter Agreement, and his right to receive all remuneration and benefits thereunder, will terminate by mutual agreement on the Termination Date. Notwithstanding the termination of Mr Goodey’s employment, he will remain entitled to tax preparation assistance in accordance with the provisions of Clause 2. (Tax Preparation Assistance) of Section E. (Assistance & Allowances) of his Transfer Letter dated August 17, 2018 (the “Transfer Letter”), the remaining terms of such Transfer Letter having been superseded and of no further effect. For the avoidance of doubt this will include assistance in filing Mr Goodey’s UK tax return for tax year 2018-2019. |
2.3 | Welltower hereby consents to Mr Goodey retaining the mobile telephone number currently allocated to his work mobile telephone on the basis that Mr Goodey will be responsible for the cost of all telephone |
2.4 | Mr Goodey hereby resigns with effect from the Effective Date any and all other positions Mr Goodey holds (i) with Welltower, (ii) with any Group Company, or (iii) with any other organization as to any position held at the request of, as a representative of, or for the benefit of Welltower. Mr Goodey agrees to take any additional necessary steps and sign any additional documentation that may be reasonably requested by Welltower, which Welltower in good faith shall endeavor to complete within 90 days of the Effective Date, in order to give full effect or confirmation of such resignations. |
2.5 | Without prejudice to his obligations under clause 2.4 above, Mr Goodey will execute a letter of resignation in the form set out in schedule 4 hereto on the Effective Date. |
3. | LONG-TERM INCENTIVE PROGRAM AND BONUS |
3.1 | Provided Mr Goodey has previously returned to Welltower a copy of this Agreement signed by him and the letter in schedule 1 signed by the Adviser and further provided he satisfies the provisions of this Agreement and his obligations under the Programs, the instalment of Mr Goodey’s 2017 Promotion Equity Grant which is due to vest in October 2019 will continue to vest on such date notwithstanding the prior termination of Mr Goodey’s employment with Welltower and shall settle in shares of the Company’s common stock par value $1.00 per share, and along with the bonus described at clause 3.3 below, shall serve as consideration of the waiver of claims in clause 6 below and Mr Goodey’s confidentiality obligations under clause 10.1 below; and the treatment of all of Mr Goodey’s outstanding restricted stock, restricted stock units or other equity awards with performance-based vesting shall be determined in accordance with the long-term incentive plan, and any other plans, pursuant to which such awards were granted and the applicable award agreement. Except as otherwise provided in this clause 3.1, all of Mr. Goodey’s other outstanding restricted stock, restricted stock units or other equity awards with time-based vesting shall terminate and be cancelled on the Termination Date. |
3.2 | Except as expressly otherwise provided herein, any benefits payable under the Company’s 2017-2019 Long-Term Incentive Program – Bridge 1, 2017-2019 Long-Term Incentive Program – Bridge 2, 2018-2020 Long-Term Incentive Program and 2019-2021 Long-Term Incentive Program shall be governed by the terms of such Plan or Program, as the case may be, and the separate form of Waiver and Release of Claims required thereunder, which is attached hereto as Schedule 2. |
3.3 | Subject to and conditional upon Mr Goodey complying with his obligations under this Agreement (including, without limitation, those restrictive covenants by which he are bound, whether by contract, policy of Welltower or its affiliates, or applicable law) Mr Goodey shall receive a pro-rated annual bonus for 2019 in respect of the period up to the Termination Date, payable at the time that Welltower pays bonuses to its executive officers for 2019 (but no later than March 15, 2020) with the individual performance component of this annual bonus scored at Performance Rating of 2. Company performance component will be as of 12/31/2019. The amount of this bonus is estimated to be USD $535,838. |
4. | CONTRIBUTION TOWARDS LEGAL FEES |
4.1 | Welltower shall contribute up to £1,000 (including any disbursements but excluding VAT) towards the legal fees incurred by Mr Goodey in reaching this Agreement. This payment shall be made directly to the legal advisers following receipt of appropriate invoices addressed to Mr Goodey in accordance with section 413A of the Income Tax (Earnings and Pensions) Act 2003. |
5. | CONDITION PRECEDENT |
6. | WAIVER AND RELEASE OF CLAIMS |
6.1 | Mr Goodey agrees that he has carefully considered all the facts and circumstances relating to his employment and its termination and accepts the Settlement and other terms of this Agreement in full and final settlement of: |
(a) | the following particular claims against Welltower or any Group Company and its or their officers or employees (each of which is hereby intimated and waived): |
(i) | for breach of contract or wrongful dismissal; |
(ii) | for unfair dismissal, under section 111 of the Employment Rights Act 1996; |
(iii) | for unfair dismissal under section 103A of the Employment Rights Act 1996; |
(iv) | in relation to the right to a written statement of reasons for dismissal, under section 93 of the Employment Rights Act 1996; |
(v) | for a statutory redundancy payment, under section 163 of the Employment Rights Act 1996; |
(vi) | in relation to an unlawful deduction from wages or unlawful payment, under section 23 of the Employment Rights Act 1996; |
(vii) | in relation to written employment particulars and itemised pay statements, under section 11 of the Employment Rights Act 1996; |
(viii) | in relation to working time or holiday pay, under regulation 30 of the Working Time Regulations 1998; |
(ix) | for direct or indirect discrimination, harassment or victimisation related to age, under section 120 of the Equality Act 2010; |
(x) | for less favourable treatment on the grounds of part-time status, under regulation 8 of the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000; |
(xi) | for less favourable treatment on the grounds of fixed-term status, under regulation 7 of the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002; |
(xii) | in relation to personal injury, whether or not Mr Goodey is aware or ought reasonably to be aware of such claims at the date of this agreement, |
(b) | the following additional claims against Welltower or any Group Company and its or their officers or employees (each of which is hereby intimated and waived): |
(i) | for unlawful detriment, under section 48 of the Employment Rights Act 1996 or section 56 of the Pensions Act 2008; |
(ii) | in relation to parental rights and flexible working, under sections 80 and 80H of the Employment Rights Act 1996; |
(iii) | for equal pay or equality of terms under sections 120 and 127 of the Equality Act 2010; |
(iv) | for direct or indirect discrimination, harassment or victimisation related to sex, marital or civil partnership status or gender reassignment under section 120 of the Equality Act 2010; |
(v) | for direct or indirect discrimination, harassment or victimisation related to race under section 120 of the Equality Act 2010; |
(vi) | for direct or indirect discrimination, harassment or victimisation related to disability, perceived disability, discrimination arising from disability, or failure to make adjustments under section 120 of the Equality Act 2010; |
(vii) | for direct or indirect discrimination, harassment or victimisation related to religion or belief under section 120 of the Equality Act 2010; |
(viii) | for direct or indirect discrimination, harassment or victimisation related to sexual orientation, under section 120 of the Equality Act 2010; |
(ix) | for harassment under the Protection from Harassment Act 1997; |
(x) | for failure to comply with obligations under the Human Rights Act 1998; |
(xi) | for failure to comply with obligations under the Data Protection Act 2018; |
(xii) | for failure to comply with obligations under the General Data Protection Regulation ((EU) 2016/679); |
(xiii) | arising as a consequence of the United Kingdom's membership of the European Union, |
(c) | any and all claims, actions, causes of action, demands, obligations, grievances, suits, losses, debts and expenses (including attorney’s fees and costs), damages and claims in law or in equity of any nature whatsoever, known or unknown, suspected or unsuspected, Mr Goodey ever had, now has, or may ever have (whether under common law, statute, state, federal, European Union law or otherwise) whether in the United States of America, the United Kingdom or any other country or jurisdiction against Welltower, any Group Company and any of its past or present subsidiaries, divisions, joint ventures, affiliates, related entities, predecessors, merged entities and parent entities, benefit plans, and all of their respective past and present officers, directors, stockholders, employees, partners, members, managers, owners, consultants and advisors, benefit plan administrators and trustees, agents, attorneys, insurers, representatives, affiliates and all of their respective successors and assigns (collectively, the “Welltower Released Parties”) up to and including the date of this Agreement. Without limiting the generality of the foregoing, subject to clause 6.2 below, the claims Mr Goodey is waiving include, but are not limited to, (a) any claims, demands, and causes of action alleging violations of public policy, or of any federal, state, or local law, statute, regulation, executive order, or ordinance, or of any duties or other obligations of any kind or description arising in law or equity under foreign, federal, state, or local law, regulation, ordinance, or public policy having any bearing whatsoever on the terms or conditions of Mr Goodey’s employment with or by Welltower or the termination or resignation of Mr Goodey’s employment with Welltower or any association or transaction with or by Welltower; (b) all claims of discrimination or harassment on the basis of age, sex, race, national origin, religion, sexual orientation, disability, veteran status or any other legally protected category; (c) all claims under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Fair Labor Standards Act, the Genetic Information Nondiscrimination Act, 42 U.S.C. § 1981, and all other federal, state and local fair employment and anti-discrimination laws, all as amended, including without limitation the Ohio Civil Rights Act, O.R.C. § 4112.01 et seq., the Ohio Age Discrimination in Employment Act, O.R.C. § 4112.14, the Ohio Uniformed Services Employment and Reemployment Act, O.R.C. §§ 5903.01, 5903.02; (d) all claims under the Worker Adjustment and Retraining Notification Act and similar state and local statutes, all as amended; (e) all claims under the National Labor Relations Act, as amended; (f) all claims under the Family and Medical Leave Act and other federal, state and local leave laws, all as amended; (g) all claims under the Employee Retirement Income Security Act, as amended (except with respect to accrued vested benefits under any retirement or 401(k) plan in accordance with the terms of such plan and applicable law); (h) all claims under the Sarbanes-Oxley Act of 2002, the False Claims Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Securities Exchange Act of 1934, the Commodity Exchange Act, the Consumer Financial Protection Act, the American Recovery and Reinvestment Act, the Foreign Corrupt Practices Act, and the EU Competition |
6.2 | This release of claims at Clause 6.1 (c) does not affect or waive: (a) benefits and/or the right to seek benefits under applicable workers’ compensation and/or unemployment compensation statutes; (b) any claims Mr Goodey may have for his or her own vested accrued employee benefits under the terms of Welltower’s health, welfare, or retirement benefit plans as of Mr Goodey’s last day of employment with Welltower, as amended by this Agreement; (c) any right to pursue claims which by law cannot be waived by signing this Agreement; (d) Mr Goodey’s rights to indemnification under any indemnification agreement he has with Welltower or any other Welltower Released Party and/or under Welltower’s or any Welltower Released Party’s charter or bylaws, or to whatever coverage Mr Goodey may have under Welltower’s or any Welltower Released Party’s directors’ and officers’ insurance policy for acts and omissions when Mr Goodey was an officer or director of Welltower or of any Welltower Released Party; or (e) Mr Goodey’s right to enforce this Agreement. |
6.3 | If any claim is not subject to release, to the extent permitted by law, Mr Goodey waives any right or ability to be a class or collective action representative or to otherwise participate in any putative or certified class, collective or multi-party action or proceeding based on such a claim in which Welltower or any other Welltower Released Party is a party. |
6.4 | Mr Goodey intends that this release of claims cover all claims described above, whether or not known to him. Mr Goodey further recognises the risk that, subsequent to the execution of this Agreement, he may incur loss, damage or injury which he attributes to the claims encompassed by this release. Mr Goodey also expressly waives and relinquishes, to the fullest extent permitted by law, any and all rights he may have under California Civil Code Section 1542, or the comparable provisions of the laws of any other jurisdiction, which provides as follows: |
7. | WARRANTIES |
7.1 | Mr Goodey represents and warrants that: |
7.1.1 | he has no claims against Welltower, any Group Company or any Welltower Released Parties other than those raised in clause 6.1(a), (b) and (c); |
7.1.2 | he is not guilty of any act or omission which would entitle Welltower to summarily dismiss him without notice or compensation; |
7.1.3 | he has not filed, caused to be filed, or presently is a party to any claim against any Welltower Released Party and that there has been no assignment or other transfer of any interest in any claim by Mr Goodey that is covered by the release set forth in Clause 6. |
7.1.4 | (a) Mr Goodey has been paid and/or has received all compensation, wages, bonuses, commissions, and/or benefits which are considered earned and therefore due and payable as of the date he signs this Agreement; (b) Mr Goodey has been granted any leave to which he was entitled under his Letter Agreement, the Family and Medical Leave Act or related state or local leave or disability accommodation laws; (c) Mr Goodey has no known workplace injuries or occupational diseases; (d) Mr Goodey has not been retaliated against for reporting any allegations of wrongdoing by Welltower or its officers; (e) Mr Goodey has not been prohibited, restricted or otherwise interfered with by any Welltower Released Party from communicating with any Governmental Agency as described in clause 10.3 below; and (f) all of Welltower’s decisions regarding Mr Goodey’s pay and benefits through the date of Mr Goodey’s execution of this Agreement were, to Mr Goodey’s knowledge, not discriminatory based on age, sex, race, national origin, religion, sexual orientation, disability, veteran status or any other classification protected by law. |
7.1.5 | he has not divulged any proprietary or confidential information of Welltower and will continue to maintain the confidentiality of such information consistent with Welltower’s policies and Mr Goodey’s agreement(s) with Welltower and/or common law. Mr Goodey hereby represents and warrants that he has not breached any of his obligations under Section 4 of the Welltower Inc. 2017-2019 Long-Term Incentive Program-Bridge 1, the 2017-2019 Long-Term Incentive Program – Bridge 2, the 2018-2020 Long-Term Incentive Program, and the 2019-2021 Long-Term Incentive Program (the “Programs”) and hereby ratifies and affirms such obligations, which shall continue in full force and effect in accordance with their terms. Mr Goodey understands and agrees that upon any violation of the provisions of Section 4 of the Programs, any and all payment or benefits under the Programs shall immediately stop and Mr Goodey shall be obligated to return to Welltower any amounts previously paid to him under the Programs. |
7.2 | Mr Goodey acknowledges that Welltower has relied on the warranties set out above in entering into this Agreement and that Welltower shall be released from any obligation to make any payment or provide any benefit to Mr Goodey hereunder in the event that the information so warranted proves inaccurate. |
8. | TAX INDEMNITY |
8.1 | The deductions for tax and other statutory deductions made from the Settlement by Welltower are in accordance with Welltower's current understanding of the tax regime. However Mr Goodey agrees to be responsible for the payment of any further tax and other statutory deductions (whether the same are payable in the United Kingdom, the United States of America or elsewhere) in respect of all and any part of the Settlement and to indemnify Welltower and each and every Group Company (and to keep Welltower and each and every Group Company indemnified on a continuing basis) against all and any liabilities to taxation or statutory deductions (including any interest, fines, penalties, surcharges, costs and expenses) which they may incur in respect of or by reason of all and any part of the Settlement. |
9. | COMPANY PROPERTY |
9.1 | Mr Goodey warrants that to the extent reasonably possible (i) he will return to Welltower all documents (including copies), software, credit or charge cards and any other property belonging to any of the Group Companies on or before the Leaving Date (“Group Company Property”); (ii) he has not downloaded any information or software belonging to Welltower or any Group Company; (iii) he has disclosed to Welltower any passwords or computer access codes relevant to the business of Welltower or any Group Company; and (iv) all correspondence or e-mails belonging to Welltower and held on Mr Goodey’s personal computer have been permanently deleted. |
9.2 | Mr Goodey undertakes to return to Welltower forthwith any Group Company Property which may come into his possession or control in the future. |
10. | CONFIDENTIAL INFORMATION |
10.1 | Without prejudice to Mr Goodey’s common law and contractual obligations, and subject always to Clauses 10.2 and 10.3 below, and in consideration of the amounts set forth in clause 3 above less such deductions Welltower is required by law to make, Mr Goodey shall continue to be bound by the obligations relating to the protection of confidential information, intellectual property and post-employment restrictive covenants set out in the the Programs including any confidentiality, non-disparagement, non-solicitation and non-compete referred to therein as a separate and independent obligation of this Agreement and as if the terms of the same were set out for the first time herein and that he will, without limitation to the forgoing, keep the terms of this Agreement confidential. |
10.2 | The parties both acknowledge and understand that the purpose of this Agreement is not to prevent, discourage or improperly influence the reporting of matters that are properly disclosable to the courts, to other law enforcement bodies, or under regulatory law or under the Public Interest Disclosure Act 1998 and nothing in this Agreement will restrict Mr Goodey’s right to disclose information on the terms of the settlement if required: |
10.2.1 | by any order of any court of competent jurisdiction or any regulatory, judicial, governmental or similar body or taxation authority of competent jurisdiction; |
10.2.2 | by any law or reporting requirement; |
10.2.3 | in order to instruct legal or professional advisers provided that Mr Goodey procures that any such adviser agrees to keep the information confidential; |
10.2.4 | in order to disclose any matter that may reasonably be considered to be a criminal or professional or regulatory offence in the laws or regulations of any country, or to assist in the investigation of any such offence; |
10.2.5 | in order to make a protected disclosure pursuant to the Public Interest Disclosure Act 1998 (as amended); |
10.3 | Furthermore, nothing contained in this Agreement shall limit Mr Goodey’s ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (each a “Government Agency”). Mr Goodey further understands that this Agreement does not limit his ability to communicate with any Government Agency or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to Welltower. However, to the maximum extent permitted by law, Mr Goodey agrees that if such a charge or complaint is made, he shall not be entitled to recover any individual monetary relief or other individual remedies. This Agreement does not limit or prohibit Mr Goodey’s right to receive an award for information provided to any Government Agency to the extent that such limitation or prohibition is a violation of law. |
11. | INDEPENDENT LEGAL ADVICE |
11.1 | Mr Goodey warrants that: |
11.1.1 | he has received independent legal advice from the Adviser, a qualified lawyer acting in his or her professional capacity and who holds a current practising certificate, as to the terms and effect of this Agreement and, in particular, its effect on his ability to pursue his rights before an Employment Tribunal or court of competent jurisdiction in England and Wales; |
11.1.2 | that there was in force, when the Adviser gave the advice referred to in this paragraph, a policy of insurance covering claims in respect of any loss which may arise in consequence of the advice, as required by section 203 of the Employment Rights Act 1996 and section 147 of the Equality Act 2010, and also that, that lawyer is an independent adviser for the purposes of section 147 of the Equality Act 2010; and |
11.1.3 | he shall provide Welltower with a letter in the form set out in schedule 1 signed by the Adviser. |
12. | COMPLIANCE WITH LEGISLATION |
13. | REPAYMENT PROVISIONS |
(a) | breaches any material term of this Agreement; or |
(b) | raises any grievance in writing with Welltower or any Group Company before or within four months of the Leaving Date; |
(c) | lodges a subject access request under Article 15 of the General Data Protection Regulation ((EU) 2016/679) with any Group Company; or |
(d) | commences proceedings against Welltower or any Group Company in breach of this Agreement |
14. | FUTURE COOPERATION |
15. | NO ADMISSION OF WRONGDOING |
16. | ADDITIONAL FORMALITIES |
16.1 | Welltower hereby advises Mr Goodey to consult with an attorney licensed to practice law in one or more jurisdictions in the United States of America of his choosing prior to signing this Agreement. Mr Goodey understands and agrees that he has the right and has been given the opportunity to review this Agreement with such an attorney. Mr Goodey acknowledges and agrees that the payments and benefits provided by Welltower under the terms of the Programs are sufficient consideration to require him to comply with his obligations under this Agreement. Mr Goodey represents that he has read this Agreement and understands its terms and that he enters into this Agreement freely, voluntarily, and without coercion. Except as otherwise provided in Clause 16.2, MR GOODEY, FREELY AND KNOWINGLY, AND AFTER DUE CONSIDERATION, ENTERS INTO THIS AGREEMENT INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS HE HAS OR MIGHT HAVE AGAINST EACH AND EVERY WELLTOWER RELEASED PARTY AS OF THE DATE OF EXECUTION OF THIS AGREEMENT. |
16.2 | Mr Goodey acknowledges and agrees that: (a) He has been given at least twenty-one (21) days during which to review and consider the provisions of this Agreement, although he may at his discretion, knowingly and voluntarily, sign and return the Agreement at any earlier time, but Mr Goodey may not sign and return the Agreement until on or after his or her last day of employment with Welltower; ; (b) modification of this Agreement does not restart this twenty-one (21)-day consideration period; (c) Mr Goodey is waiving rights or claims which may be waived by law in exchange for consideration that is not otherwise due him, including claims and rights under the Age Discrimination in Employment Act of 1967, as amended (the “ADEA”), and as otherwise described in this Agreement; (d) rights or claims that may arise after the date this Agreement is executed, including those arising under the ADEA, are not waived by this Agreement; (e) at any time within seven (7) days after signing this Agreement, Mr Goodey may revoke this Agreement; and (f) this Agreement is not enforceable until the revocation period has passed without a revocation. |
16.3 | To revoke this Agreement, Mr Goodey must send a written statement of revocation delivered by certified mail and email to Welltower Inc., Attn: General Counsel, 4500 Dorr Street, Toledo, OH 43615, Email: MMcQueen@welltower.com . This revocation must be received no later than the seventh (7th) day following Mr Goodey’s execution of this Agreement. If no such revocation occurs, this Agreement shall become effective on the eighth (8th) day following execution of this Agreement. |
16.4 | In the event that Mr Goodey revokes this Agreement, it shall have no force or effect, and Mr Goodey shall have no right to receive or retain any payments and benefits provided by Welltower under the terms of the Programs. |
16.5 | Mr Goodey affirms and agrees that he has not divulged any proprietary or confidential information of Welltower and will continue to maintain the confidentiality of such information consistent with Welltower’s policies and Mr Goodey’s agreement(s) with Welltower, any Group Company and/or common law. Mr Goodey hereby represents and warrants that he has not breached any of his obligations under Section 4 of the Programs and hereby ratifies and affirms such obligations, which shall continue in full force and effect in accordance with their terms. Mr Goodey understands and agrees that upon any violation of the provisions of Section 4 of the Programs, any and all payment or benefits under the Programs and/or this Agreement shall immediately stop and Mr Goodey shall be obligated to immediately pay to Welltower an amount equal to the aggregate of any sums previously paid to him under the Programs and/or this Agreement. |
17. | WITHOUT PREJUDICE STATUS |
18. | THIRD PARTIES RIGHTS |
19. | ENTIRE AGREEMENT |
19.1 | The terms of this Agreement constitute the entire agreement between the parties in respect of the termination of Mr Goodey’s employment and supersede any previous agreement between them linked to the termination of Mr Goodey’s employment. The parties acknowledge that they are not entering into this Agreement in reliance upon any representation, warranty or undertaking which is not contained or referred to in this Agreement. The terms of this Agreement do not replace or supersede any provision of the Letter Agreement as amended by this Agreement, nor do they replace or supercede any terms of the Programs including any confidentiality, non-disparagement, non-solicitation and non-compete referred to therein. |
19.2 | No variation of this Agreement shall be binding on either party unless and to the extent that the same is recorded in a written document executed by the parties. No waiver by Welltower or any Group Company of any term, provision or condition of this Agreement or of any breach by Mr Goodey of any such term, provision or condition shall be effective unless it is in writing (excluding e-mail) and signed by Welltower. No failure to exercise nor any delay in exercising any right or remedy hereunder by Welltower or any Group Company shall operate as a waiver thereof or of any other right or remedy hereunder, nor shall any single or partial exercise of any right or remedy by Welltower or any Group Company prevent any further or other exercise thereof or the exercise of any other right or remedy. |
20. | SEVERABILITY |
21. | COUNTERPARTS |
22. | GOVERNING LAW AND JURISDICTION |
22.1 | This Agreement shall be governed by and construed in accordance with the law of England and Wales. |
22.2 | Each party irrevocably agrees to submit to the non-exclusive jurisdiction of the courts of England and Wales over any claim or matter arising under or in connection with this Agreement. |
1. | [name of adviser] has given Mr Goodey independent advice as to the terms and effect of the Settlement Agreement and, in particular, (i) its effect on his ability to pursue his rights before an employment tribunal or court; and (ii) the meaning and effect of this clause and clause 11 of the Settlement Agreement and the circumstances in which Mr Goodey is free to use or disclose information in accordance with the provisions of this clause 12.2; |
2. | [name of adviser] is a solicitor of the Senior Courts of England and Wales and holds (and held at the time the advice was given) a current practising certificate issued by The Solicitors Regulation Authority; |
3. | [firm] holds, and held at the time the advice was given, a current policy of insurance or an indemnity provided for members of a profession or professional body covering the risk of a claim by Mr Goodey in respect of any loss arising in consequence of the advice; and |
4. | neither [firm] nor [name of adviser] acted for Welltower or any Group Company in relation to the termination of Mr Goodey's employment with Welltower or the Settlement Agreement and we consider [name of adviser] to be an independent adviser for the purposes of section 147 of the Equality Act 2010. |
1.1. | General Release of All Claims. In exchange for the payments and benefits provided by the Company under the terms of the Welltower Inc. 2005 Long-Term Incentive Plan, Welltower Inc. 2016 Long-Term Incentive Plan, Welltower Inc. 2017-2019 Long-Term Incentive Program – Bridge – 1, Welltower Inc. 2017-2019 Long-Term Incentive Program – Bridge 2, Welltower Inc. 2018-2020 Long-Term Incentive Program and Welltower Inc. 2019-2021 Long-Term Incentive Program (the “Programs”), which Employee acknowledges and agrees provide adequate consideration to which Employee would not otherwise be entitled, Employee unconditionally, knowingly and voluntarily releases, remises, and forever discharges the Company and any of its past or present subsidiaries, divisions, joint ventures, affiliates, related entities, predecessors, merged entities and parent entities, benefit plans, and all of their respective past and present officers, directors, stockholders, employees, partners, members, managers, owners, consultants and advisors, benefit plan administrators and trustees, agents, attorneys, insurers, representatives, affiliates and all of their respective successors and assigns (collectively, the “Company Released Parties”), from any and all claims, actions, causes of action, demands, obligations, grievances, suits, losses, debts and expenses (including attorney’s fees and costs), damages and claims in law or in equity of any nature whatsoever, known or unknown, suspected or unsuspected, Employee ever had, now has, or may ever have against any Company Released Party up to and including the day on which Employee signs this Agreement. Without limiting the generality of the foregoing, subject to Section 1.2 below, the claims Employee is waiving include, but are not limited to, (a) any claims, demands, and causes of action alleging violations of public policy, or of any federal, state, or local law, statute, regulation, executive order, or ordinance, or of any duties or other obligations of any kind or description arising in law or equity under foreign, federal, state, or local law, regulation, ordinance, or public policy having any bearing whatsoever on the terms or conditions of Employee’s employment with or by the Company or the termination or resignation of Employee’s employment with the Company or any association or transaction with or by the Company; (b) all claims of discrimination or harassment on the basis of age, sex, race, national origin, religion, sexual orientation, disability, veteran status or any other legally protected category; (c) all claims under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Fair Labor Standards Act, the Genetic Information Nondiscrimination Act, 42 U.S.C. § 1981, and all other federal, state and local fair employment and anti-discrimination laws, all as amended, including without limitation the Ohio Civil Rights Act, O.R.C. § 4112.01 et seq., the Ohio Age Discrimination in Employment Act, O.R.C. § 4112.14, the Ohio Uniformed Services Employment and Reemployment Act, O.R.C. §§ 5903.01, 5903.02; (d) all claims under the Worker Adjustment and Retraining Notification Act and similar state and local statutes, all as amended; (e) all claims under the National Labor Relations Act, as amended; (f) all claims under the Family and Medical Leave Act and other federal, state and local leave laws, all as amended; (g) all claims under the |
1.2. | Claims Not Released. This release of claims does not affect or waive: (a) benefits and/or the right to seek benefits under applicable workers’ compensation and/or unemployment compensation statutes; (b) any claims Employee may have for his own vested accrued employee benefits under the terms of the Company’s health, welfare, or retirement benefit plans as of Employee’s last day of employment with the Company; (c) any right to pursue claims which by law cannot be waived by signing this Agreement; (d) Employee’s rights to indemnification under any indemnification agreement he has with the Company or any other Company Released Party and/or under the Company’s or any Company Released Party’s charter or bylaws, or to whatever coverage Employee may have under the Company’s or any Company Released Party’s directors’ and officers’ insurance policy for acts and omissions when Employee was an officer or director of the Company or of any Company Released Party; or (e) Employee’s right to enforce this Agreement and the Settlement Agreement between the Company and Employee, dated September [3], 2019 (the “Settlement Agreement”) (including, for the avoidance of doubt, his rights with respect to the equity awards described in Schedule 3 of the Settlement Agreement). |
1.3. | Government Agencies. Notwithstanding any other provision in this Agreement to the contrary, nothing contained in this Agreement limits Employee’s ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (each a “Government Agency”). Employee further understands that this Agreement does not limit Employee’s ability to communicate with any Government Agency or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. However, to the maximum extent permitted by law, Employee agrees that if such a charge or complaint is made, Employee shall not be entitled to recover any individual monetary relief or other individual remedies. This Agreement does not limit or prohibit Employee’s right to receive an award for information provided to any Government Agency to the extent that such limitation or prohibition is a violation of law. |
1.4. | Collective/Class Action Waiver. If any claim is not subject to release, to the extent permitted by law, Employee waives any right or ability to be a class or collective action representative or to otherwise participate in any putative or certified class, collective or multi-party action or proceeding based on such a claim in which the Company or any other Company Released Party is a party. |
1.5. | Release of Unknown Claims. Employee intends that this release of claims cover all claims described above, whether or not known to Employee. Employee further recognizes the risk that, subsequent to the execution of this Agreement, Employee may incur loss, damage or injury which Employee attributes to the claims encompassed by this release. Employee also expressly waives and relinquishes, to the fullest extent permitted by law, any and all rights he may have under California Civil Code Section 1542, or the comparable provisions of the laws of any other jurisdiction, which provides as follows: |
2.1. | Employee affirms that Employee has not filed, caused to be filed, or presently is a party to any claim against any Company Released Party. Employee also represents and warrants that there has been no assignment or other transfer of any interest in any claim by Employee that is covered by the release set forth in Section 1. |
2.2. | Employee affirms that (a) except for the benefits referred to in Section 1.2(b) above, Employee has been paid and/or has received all compensation, wages, bonuses, commissions, and/or benefits which are considered earned and therefore due and payable as of the date Employee signs this Agreement; (b) Employee has been granted any leave to which Employee was entitled under the Family and Medical Leave Act or related state or local leave or disability accommodation laws; (c) Employee has no known workplace injuries or occupational diseases; (d) Employee has not been retaliated against for reporting any allegations of wrongdoing by the Company or its officers; (e) Employee has not been prohibited, restricted or otherwise interfered with by any Company Released Party from communicating with any Governmental Agency as described in Section 1.3 above; and (f) all of the Company’s decisions regarding Employee’s pay and benefits through the date of Employee’s execution of this Agreement were, to Employee’s knowledge, not discriminatory based on age, sex, race, national origin, religion, sexual orientation, disability, veteran status or any other classification protected by law. |
2.3. | Employee affirms and agrees that Employee has not divulged any proprietary or confidential information of the Company and will continue to maintain the confidentiality of such information consistent with the Company’s policies and Employee’s agreement(s) with the Company and/or common law. Employee hereby represents and warrants that he has not breached any of his obligations under Section 4 of the Programs and hereby ratifies and affirms such obligations, which shall continue in full force and effect in accordance with their terms. Employee understands and agrees that upon any violation of the provisions of Section 4 of the Programs, any and all payment or benefits under the Programs shall immediately stop and Employee shall be obligated to return to the Company any amounts previously paid to Employee under the Program. |
3. | No Admission of Wrongdoing. Employee and the Company agree that neither this Agreement nor the furnishing of the consideration for this Agreement shall be deemed or construed at any time for any purpose as an admission by any Company Released Party of wrongdoing or evidence of any liability or unlawful conduct of any kind. |
4. | Consultation with Attorney; Voluntary Agreement. The Company hereby advises Employee to consult with an attorney of his choosing prior to signing this Agreement. Employee understands and agrees that Employee has the right and has been given the opportunity to review this Agreement with an attorney. Employee acknowledges and agrees that the payments and benefits provided by the Company under the terms of the Programs are sufficient consideration to require him to comply with his obligations under |
5. | Effective Date; Revocation. Employee acknowledges and agrees that: (a) Employee has been given at least twenty-one (21) days during which to review and consider the provisions of this Agreement, although he may at his discretion, knowingly and voluntarily, sign and return the Agreement at any earlier time, but Employee may not sign and return the Agreement until on or after his last day of employment with the Company; (b) modification of this Agreement does not restart this twenty-one (21)-day consideration period; (c) Employee is waiving rights or claims which may be waived by law in exchange for consideration that is not otherwise due to Employee, including claims and rights under the Age Discrimination in Employment Act of 1967, as amended (the “ADEA”), and as otherwise described in this Agreement; (d) rights or claims that may arise after the date this Agreement is executed, including those arising under the ADEA, are not waived by this Agreement; (e) at any time within seven (7) days after signing this Agreement, Employee may revoke this Agreement; and (f) this Agreement is not enforceable until the revocation period has passed without a revocation. |
6. | Severability. In the event that any one or more of the provisions of this Agreement shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remainder of the Agreement shall not in any way be affected or impaired thereby. |
7. | Waiver. No waiver by either party of any breach by the other party of any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of any other provision or condition at the time or at any prior or subsequent time. This Agreement and the provisions contained in it shall not be construed or interpreted for or against either party because that party drafted or caused that party’s legal representative to draft any of its provisions. |
8. | Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Ohio, without regard to principles of conflict of laws of such state. |
9. | Headings. All descriptive headings in this Agreement are inserted for convenience only and shall be disregarded in construing or applying any provision of this Agreement. |
10. | Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. |
WELLTOWER, INC | EXECUTIVE | |||
By: | /s/ Matthew McQueen | /s/ John Goodey | ||
Name: | Matthew McQueen | John Goodey | ||
Title: | Senior Vice President - General Counsel and Corporate Secretary | |||
Date: | 5 September 2019 | Date: | 5 September 2019 | |
Earned Equity - Accelerated Vesting of Unvested Units | |
3,600 units | October 2019 vesting of the promotion equity award of restricted stock granted in October 2017 |
30,741 units | Performance-based units granted with the 2017-2019 Bridge 1, 2017-2019 Bridge 2, 2018-2020 LTIP, and 2019-2021 LTIP; based on company performance (as of 2Q-2019, certified by the Compensation Committee) and prorated by time-worked of applicable performance period |
$3,049,137 | Estimated value as of closing stock price on 8/16/19 of $88.79; estimated accrued dividends of $164,894.58 are not included |
(a) | An officer of the Company having annual compensation greater than the compensation limit in Section 416(i)(1)(A)(i) of the Code, provided that no more than fifty officers of the Company shall be determined to be Specified Employees as of any Identification Date; |
(b) | A five percent owner of the Company regardless of compensation; or |
(c) | A one percent owner of the Company having annual compensation from the Company of more than $150,000. |
(i) | Lump Sum. Payment in one lump sum. |
(ii) | Installments. Payment in either five or ten annual installments. |
(i) | Lump Sum. Payment in one lump sum. |
(ii) | Installments. Payment in either five or ten annual installments. |
(d) | Appeal to Committee. |
1. | I have reviewed this quarterly report on Form 10-Q of Welltower 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. |
/s/ THOMAS J. DEROSA | ||
Thomas J. DeRosa, | ||
Chairman and Chief Executive Officer | ||
1. | I have reviewed this quarterly report on Form 10-Q of Welltower 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. |
/s/ TIMOTHY G. MCHUGH | ||
Timothy G. McHugh, | ||
Chief Financial Officer | ||
/s/ THOMAS J. DEROSA | ||||
Thomas J. DeRosa, | ||||
Chairman and Chief Executive Officer Date: October 30, 2019 | ||||
/s/ TIMOTHY G. MCHUGH | ||||
Timothy G. McHugh, | ||||
Chief Financial Officer Date: October 30, 2019 | ||||
Variable Interest Entities |
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| Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Variable Interest Entities | Variable Interest Entities We have entered into joint ventures to own certain seniors housing and outpatient medical assets which are deemed to be Variable Interest Entities (VIEs). We have concluded that we are the primary beneficiary of these VIEs based on a combination of operational control of the joint venture and the rights to receive residual returns or the obligation to absorb losses arising from the joint ventures. Except for capital contributions associated with the initial joint venture formations, the joint ventures have been and are expected to be funded from the ongoing operations of the underlying properties. Accordingly, such joint ventures have been consolidated, and the table below summarizes the balance sheets of consolidated VIEs in the aggregate (in thousands):
(1) Note that assets of the consolidated VIEs can only be used to settle obligations relating to such VIEs. Liabilities of the consolidated VIEs represent claims against the specific assets of the VIEs.
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Earnings Per Share |
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| Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share data):
The Series I Cumulative Convertible Perpetual Preferred Stock were excluded from the 2018 calculation as the effect of the conversions were anti-dilutive. As of September 30, 2019, forward sales agreements outstanding for the sale of 5,152,658 shares of common stock were not included in the computation of diluted earnings per share because such forward sales were anti-dilutive for the period.
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