Investments in Unconsolidated Entities

12 Months Ended

Dec. 31, 2024

Real Estate Investments, Net [Abstract]

We participate in a number of joint ventures, which generally invest in seniors housing and healthcare real estate. Our share of the results of operations for these properties has been included in our consolidated results of operations from the date of acquisition by the joint ventures and are reflected in our Consolidated Statements of Comprehensive Income as income or loss from unconsolidated entities. The following is a summary of our investments in unconsolidated entities (dollars in thousands):


	Percentage Ownership(1)	December 31, 2024		December 31, 2023
Seniors Housing Operating	10% to 95%	$	1,412,708	$	1,248,774
Triple-net	10% to 25%	35,066		69,848
Outpatient Medical	15% to 50%	249,889		240,078
Non-segment/Corporate	32% to 88%	71,109		77,831
Total		$	1,768,772	$	1,636,531

(1) As of December 31, 2024 and includes ownership of investments classified as liabilities and excludes ownership of in-substance real estate.

During the year ended December 31, 2023 we recognized $35,293,000 of impairment losses related to investments in unconsolidated entities in our Consolidated Statements of Comprehensive Income as income or loss from unconsolidated entities. No such impairment losses were recognized during the years ended December 31, 2024 or 2022.

Through June 30, 2023, we owned 34% of Sunrise ManCo, which provided comprehensive property management and accounting services with respect to certain of our Seniors Housing Operating properties operated by Sunrise. We paid Sunrise annual management fees pursuant to long-term management agreements. The management fees paid to Sunrise included a fee based on a percentage of revenues generated by the applicable properties plus, if applicable, positive or negative adjustments based on specified performance targets. For the period in which we owned Sunrise ManCo in 2023, we recognized management fees of $14,185,000 which are reflected within property operating expenses in our Consolidated Statements of Comprehensive Income. For the year ended December 31, 2022, we recognized $27,660,000 of management fees. Prior to the sale of our interest in Sunrise ManCo, we recognized an impairment charge of $28,708,000 in income from unconsolidated entities on our Consolidated Statements of Comprehensive Income for the year ended December 31, 2023, calculated as the excess of the carrying value of our investment in the management company compared to estimated sales proceeds for its sale.

At December 31, 2024, the aggregate unamortized basis difference of our joint venture investments of $190,955,000 is primarily attributable to the difference between the amount for which we purchased our interest in the entity, including transaction costs and the historical carrying value of the net assets of the joint venture. This difference is being amortized over the remaining useful life of the related properties and included in the reported amount of income from unconsolidated entities.

We have made loans related to 25 properties as of December 31, 2024 for the development and construction of certain properties that have a carrying value of $941,216,000. We believe that such borrowers typically represent VIEs in accordance with ASC 810. VIEs are required to be consolidated by their primary beneficiary, which is the enterprise that has both: (i) the power to direct the activities of the VIE that most significantly impacts the entity’s economic performance; and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could be significant to the entity. We have concluded that we are not the primary beneficiary of such borrowers, therefore, the loan arrangements were assessed based on among other factors, the amount and timing of expected residual profits, the estimated fair value of the collateral and the significance of the borrower’s equity in the project. Based on these assessments, the arrangements have been classified as in substance real estate investments. We are obligated to fund an additional $108,765,000 related to these investments.

In January 2025, we announced the formation of a private funds management business in conjunction with the launch of our first seniors housing investment fund, which was formed with the intent to invest up to $2 billion in U.S. seniors housing properties that are either stable or with a near-term path to stabilization. Welltower will serve as the General Partner and Asset Manager, and also have a limited partner interest in the fund.