Real Property Acquisitions and Development

12 Months Ended

Dec. 31, 2021

Real Property Acquisitions and Development

Real Property Acquisitions and Development The total purchase price for all properties acquired has been allocated to the tangible and identifiable intangible assets and liabilities at cost on a relative fair value basis. Liabilities assumed and any associated noncontrolling interests are reflected at fair value. The results of operations for these acquisitions have been included in our consolidated results of operations since the date of acquisition and are a component of the appropriate segments. Transaction costs primarily represent costs incurred with acquisitions, including due diligence costs, fees for legal and valuation services, termination of pre-existing relationships computed based on the fair value of the assets acquired, lease termination fees and other acquisition-related costs. Transaction costs related to asset acquisitions are capitalized as a component of purchase price and all other non-capitalizable costs are reflected in other expenses on our Consolidated Statements of Comprehensive Income.

The following is a summary of our real property investment activity by segment for the periods presented (in thousands):


	Year Ended December 31, 2021
	Seniors Housing Operating		Triple-net		Outpatient Medical		Total
Land and land improvements	$	449,335	$	88,839	$	64,843	$	603,017
Buildings and improvements	2,347,609		809,328		313,864		3,470,801
Acquired lease intangibles	264,589		—		24,751		289,340


Right of use assets, net	77,455		—		—		77,455
Total net real estate assets	3,138,988		898,167		403,458		4,440,613
Receivables and other assets	6,096		411		3,534		10,041
Total assets acquired(1)	3,145,084		898,578		406,992		4,450,654

Lease liabilities	(138,126)		—		—		(138,126)
Accrued expenses and other liabilities	(191,454)		(8,703)		(266)		(200,423)
Total liabilities acquired	(329,580)		(8,703)		(266)		(338,549)
Noncontrolling interests(2)	(4,942)		(6,449)		(16,540)		(27,931)

Cash disbursed for acquisitions	2,810,562		883,426		390,186		4,084,174
Construction in progress additions	322,050		77,412		42,464		441,926
Less: Capitalized interest	(13,834)		(3,078)		(2,440)		(19,352)
Accruals(3)	35		—		(4,646)		(4,611)
Cash disbursed for construction in progress	308,251		74,334		35,378		417,963
Capital improvements to existing properties	197,829		37,345		47,414		282,588
Total cash invested in real property, net of cash acquired	$	3,316,642	$	995,105	$	472,978	$	4,784,725

(1) Excludes $4,201,000 of unrestricted and restricted cash acquired.

(2) Includes amounts attributable to both redeemable noncontrolling interests and noncontrolling interests.

(3) Represents non-cash accruals for amounts to be paid in future periods for properties that converted, off-set by amounts paid in the current period.


	Year Ended December 31, 2020
	Seniors Housing Operating		Triple-net		Outpatient Medical		Total
Land and land improvements	$	55,000	$	16,876	$	45,590	$	117,466
Buildings and improvements	527,189		73,855		179,004		780,048
Acquired lease intangibles	28,668		—		24,718		53,386



Total net real estate assets	610,857		90,731		249,312		950,900
Receivables and other assets	746		—		268		1,014
Total assets acquired(1)	611,603		90,731		249,580		951,914


Accrued expenses and other liabilities	(1,650)		—		(962)		(2,612)
Total liabilities acquired	(1,650)		—		(962)		(2,612)
Noncontrolling interests(2)	(45,546)		—		—		(45,546)

Cash disbursed for acquisitions	564,407		90,731		248,618		903,756
Construction in progress additions	134,945		45,256		39,833		220,034
Less: Capitalized interest	(10,389)		(3,209)		(3,874)		(17,472)
Accruals (3)	(1,226)		—		—		(1,226)
Cash disbursed for construction in progress	123,330		42,047		35,959		201,336
Capital improvements to existing properties	107,379		76,625		60,985		244,989
Total cash invested in real property, net of cash acquired	$	795,116	$	209,403	$	345,562	$	1,350,081

(1) Excludes $580,000 of unrestricted and restricted cash acquired.

(2) Includes amounts attributable to both redeemable noncontrolling interests and noncontrolling interests.

(3) Represents non-cash accruals for amounts to be paid in future periods for properties that converted, off-set by amounts paid in the current period.


	Year Ended December 31, 2019
	Seniors Housing Operating		Triple-net		Outpatient Medical		Total
Land and land improvements	$	154,470	$	24,097	$	293,933	$	472,500
Buildings and improvements	1,518,748		203,282		1,954,928		3,676,958
Acquired lease intangibles	76,009		—		183,921		259,930
Real property held for sale	17,435		—		—		17,435
Construction in progress	36,174		—		—		36,174
Right of use assets, net	—		—		58,377		58,377
Total net real estate assets	1,802,836		227,379		2,491,159		4,521,374
Receivables and other assets	15,634		—		1,586		17,220
Total assets acquired(1)	1,818,470		227,379		2,492,745		4,538,594
Secured debt	(194,408)		—		(206,754)		(401,162)
Lease liabilities	—		—		(47,740)		(47,740)
Accrued expenses and other liabilities	(12,024)		—		(32,893)		(44,917)
Total liabilities acquired	(206,432)		—		(287,387)		(493,819)
Noncontrolling interests(2)	(67,987)		(4,015)		(1,201)		(73,203)
Non-cash acquisition related activity (3)	(11,889)		—		—		(11,889)
Cash disbursed for acquisitions	1,532,162		223,364		2,204,157		3,959,683
Construction in progress additions	227,018		61,414		60,884		349,316
Less: Capitalized interest	(8,889)		(2,385)		(3,998)		(15,272)
Accruals(4)	—		—		(1,035)		(1,035)
Cash disbursed for construction in progress	218,129		59,029		55,851		333,009
Capital improvements to existing properties	260,413		17,426		50,985		328,824
Total cash invested in real property, net of cash acquired	$	2,010,704	$	299,819	$	2,310,993	$	4,621,516

(1) Excludes $2,090,000 of unrestricted and restricted cash acquired.

(2) Includes amounts attributable to both redeemable noncontrolling interests and noncontrolling interests.

(3) Relates to the acquisition of assets previously recognized as investments in unconsolidated entities.

(4) Represents non-cash accruals for amounts to be paid in future periods for properties that converted, off-set by amounts paid in the current period.

Holiday Retirement Acquisition

On July 30, 2021, we acquired a portfolio of 85 seniors housing properties owned by Holiday Retirement for $1,576,600,000, which are included in our Seniors Housing Operating segment and in the table above for the year ended December 31, 2021. Atria Senior Living assumed operations of the portfolio following its acquisition of the Holiday Retirement management company pursuant to an incentive-based management agreement. As part of this transaction, a wholly owned subsidiary assumed the leasehold interest in a 26 property portfolio and subsequently purchased eight of the leased properties from the landlord. The lease, identified as an operating lease, expires in 2035 and was recognized as a right of use asset, net of above market lease intangibles, and lease liability.

Construction Activity

The following is a summary of the construction projects that were placed into service and began generating revenues during the periods presented (in thousands):


	Year Ended
	December 31, 2021		December 31, 2020		December 31, 2019
Development projects:
Seniors Housing Operating	$	117,386	$	93,188	$	28,117
Triple-net	22,990		75,149		—
Outpatient Medical	125,179		43,493		21,006
Total development projects	265,555		211,830		49,123
Expansion projects	5,292		48,600		—
Total construction in progress conversions	$	270,847	$	260,430	$	49,123