XML 27 R13.htm IDEA: XBRL DOCUMENT
v3.20.4

Dispositions of Real Estate and Discontinued Operations | 12 Months Ended
--- | ---
Dec. 31, 2020
Discontinued Operations and Disposal Groups [Abstract] |
Dispositions of Real Estate and Discontinued Operations | Dispositions of Real Estate and Discontinued Operations 2020 Dispositions of Real Estate Aegis NNN Portfolio In December 2020, the Company sold 10 senior housing triple-net assets (the “Aegis NNN Portfolio”) for $358 million, resulting in total gain on sales of $228 million, which is recognized in income (loss) from discontinued operations. Atria SHOP Portfolio In November 2020, the Company entered into definitive agreements to sell a portfolio of 13 SHOP assets (the “Atria SHOP Portfolio”) for $334 million. In December 2020, the Company sold 12 of those assets for $312 million, resulting in total gain on sales of $39 million, which is recognized in income (loss) from discontinued operations. The Company provided the buyer with financing of $61 million on four of the assets sold (see Note 8). The final asset is expected to be sold during the first half of 2021, upon completion of the license transfer process. Sunrise Senior Housing Portfolio In November 2020, the Company entered into a definitive agreement to sell 32 SHOP and 2 senior housing triple-net assets for $744 million (the “Sunrise Senior Housing Portfolio”). The Company received a $35 million nonrefundable deposit upon completion of due diligence in December 2020, sold the 32 SHOP assets in January 2021 for $664 million, and provided the buyer with financing of $410 million (see Note 8). The two remaining senior housing triple-net assets are expected to be sold during the first half of 2021, upon completion of the license transfer process. SLC SHOP Portfolio In October 2020, the Company entered into a definitive agreement to sell seven SHOP assets for $115 million. The Company received a $3 million nonrefundable deposit and expects to close the transaction during the first half of 2021. Brookdale Triple-Net Portfolio In January 2021, the Company sold 24 senior housing assets in a triple-net lease with Brookdale for $510 million. Additional SHOP Portfolio In January 2021, the Company sold a portfolio of 16 SHOP assets for $230 million and provided the buyer with financing of $150 million (see Note 8). HRA Triple-Net Portfolio In February 2021, the Company sold eight senior housing assets in a triple-net lease with Harbor Retirement Associates for $132 million. 2020 Other Dispositions In addition to the sales discussed above, during the year ended December 31, 2020, the Company sold the following: (i) 23 SHOP assets for $190 million, (ii) 21 senior housing triple-net assets for $428 million (inclusive of the 18 facilities sold to Brookdale under the 2019 MTCA - see Note 3), (iii) 11 MOBs for $136 million (inclusive of the exercise of a purchase option by a tenant to acquire 3 MOBs in San Diego, California), (iv) two MOB land parcels for $3 million, and (v) 1 asset from other non-reportable segments for $1 million, resulting in total gain on sales of $283 million ($193 million of which is reported in income (loss) from discontinued operations). 2019 Dispositions of Real Estate During the year ended December 31, 2019, the Company sold the following: (i) 18 SHOP assets for $181 million, (ii) 2 senior housing triple-net assets for $26 million, (iii) 11 MOBs for $28 million, (vi) 1 life science asset for $7 million, (v) 1 undeveloped life science land parcel for $35 million, and (vi) 1 facility from the other non-reportable segment for $15 million, resulting in total gain on sales of $30 million ($23 million of which is reported in income (loss) from discontinued operations). 2018 Dispositions of Real Estate Shoreline Technology Center In November 2018, the Company sold its Shoreline Technology Center life science campus located in Mountain View, California for $1.0 billion and recognized a gain on sale of $726 million. Brookdale MTCA Dispositions As discussed in Note 3, during the fourth quarter of 2018, the Company sold 19 assets (11 senior housing triple-net assets and 8 SHOP assets) to a third-party for $377 million and recognized a gain on sale of $40 million, which is reported in income (loss) from discontinued operations. Refer to Note 3 for further detail on the Brookdale transactions. RIDEA II Sale Transaction In January 2017, the Company completed the contribution of its ownership interest in RIDEA II to an unconsolidated joint venture owned by Healthpeak and an investor group led by Columbia Pacific Advisors, LLC (“CPA”) (the “Healthpeak/CPA JV”). Also in January 2017, RIDEA II was recapitalized with $602 million of debt, of which $360 million was provided by a third-party and $242 million was provided by the Company. In return for both transaction elements, the Company received combined proceeds of $480 million from the Healthpeak/CPA JV and $242 million in loans receivable and retained an approximately 40% ownership interest in RIDEA II. This transaction resulted in the Company deconsolidating the net assets of RIDEA II and recognizing a net gain on sale of $99 million. Refer to Note 2 for the impact of adopting the Revenue ASUs on January 1, 2018 to the Company’s partial sale of RIDEA II in the first quarter of 2017. In June 2018, the Company sold its remaining 40% ownership interest in RIDEA II to an investor group led by CPA for $91 million. Additionally, CPA refinanced the Company’s $242 million of loans receivable from RIDEA II, resulting in total proceeds of $332 million. The Company no longer holds an economic interest in RIDEA II. U.K. Portfolio In June 2018, the Company entered into a joint venture with an institutional investor (the “U.K. JV”) through which the Company sold a 51% interest in substantially all United Kingdom (“U.K.”) assets previously owned by the Company (the “U.K. Portfolio”) based on a total value of £382 million ($507 million). The Company retained a 49% noncontrolling interest in the U.K. JV and received gross proceeds of $402 million, including proceeds from the refinancing of the Company’s previously held intercompany loans. Upon closing the U.K. JV, the Company deconsolidated the U.K. Portfolio, recognized its retained noncontrolling interest investment at fair value ($105 million) and recognized a gain on sale of $11 million, net of $17 million of cumulative foreign currency translation reclassified from other comprehensive income recorded in gain (loss) on sales of real estate, net (see Note 22 for the reclassification impact of the Company’s hedge of its net investment in the U.K.). The U.K. JV provides numerous mechanisms by which the joint venture partner can acquire the Company’s remaining interest in the U.K. JV. The fair value of the Company’s retained noncontrolling interest investment was based on Level 2 measurements within the fair value hierarchy. Additionally, in August 2018, the Company sold its remaining £11 million U.K. development loan at par. In December 2019, the Company sold its remaining 49% interest in the U.K. JV (see Note 9). 2018 Other Dispositions Additionally, during the year ended December 31, 2018, the Company sold the following: (i) 4 life science assets for $269 million, (ii) 1 undeveloped land parcel for $3 million, (iii) 2 senior housing triple-net assets for $35 million, (iv) 23 SHOP facilities for $394 million, and (v) 4 MOBs for $25 million, resulting in total gain on sales of $141 million ($55 million of which is reported in income (loss) from discontinued operations). Held for Sale and Discontinued Operations At December 31, 2020, 41 senior housing triple-net facilities, 6 MOBs, 97 SHOP facilities, and 1 SHOP joint venture were classified as held for sale and/or discontinued operations. At December 31, 2019, 90 senior housing triple-net facilities (inclusive of 18 facilities sold to Brookdale under the 2019 MTCA - see Note 3), 115 SHOP facilities, 2 MOBs, and 4 SHOP joint ventures were classified as held for sale and/or discontinued operations. During 2020, the Company established and began executing a plan to dispose of all the assets in its senior housing triple-net and SHOP portfolios. The held for sale criteria for all such assets were met either on or before December 31, 2020 and the Company concluded the dispositions met the requirements to be classified as discontinued operations. The following summarizes the assets and liabilities classified as discontinued operations at December 31, 2020 and 2019, which are included in assets held for sale and discontinued operations, net and liabilities related to assets held for sale and discontinued operations, net, respectively, on the consolidated balance sheets (in thousands):
| December 31,
| 2020 |  | 2019
ASSETS |  |  |
Real estate: |  |  |
Buildings and improvements | $ | 2,553,254 |  |  | $ | 3,626,665 |
Development costs and construction in progress | 21,509 |  |  | 38,728 |
Land | 355,803 |  |  | 467,956 |
Accumulated depreciation and amortization | (615,708) |  |  | (861,557) |
Net real estate | 2,314,858 |  |  | 3,271,792 |
Investments in and advances to unconsolidated joint ventures | 5,842 |  |  | 51,134 |
Accounts receivable, net of allowance of $5,873 and $4,178 | 20,500 |  |  | 14,575 |
Cash and cash equivalents | 53,085 |  |  | 63,834 |
Restricted cash | 17,168 |  |  | 27,040 |
Intangible assets, net | 24,541 |  |  | 82,071 |
Right-of-use asset, net | 4,109 |  |  | 5,701 |
Other assets, net(1) | 103,965 |  |  | 125,502 |
Total assets of discontinued operations, net | 2,544,068 |  |  | 3,641,649 |
Total medical office assets held for sale, net(2) | 82,238 |  |  | 6,616 |
Assets held for sale and discontinued operations, net | $ | 2,626,306 |  |  | $ | 3,648,265 |
LIABILITIES |  |  |
Mortgage debt | 318,876 |  |  | 296,879 |
Lease liability | 3,189 |  |  | 4,871 |
Accounts payable, accrued liabilities, and other liabilities | 79,411 |  |  | 83,392 |
Deferred revenue | 11,442 |  |  | 18,520 |
Total liabilities of discontinued operations, net | 412,918 |  |  | 403,662 |
Total liabilities related to medical office assets held for sale, net | 2,819 |  |  | 26 |
Liabilities related to assets held for sale and discontinued operations, net | $ | 415,737 |  |  | $ | 403,688 |
_______________________________________ (1)Includes goodwill of $29 million and $30 million as of December 31, 2020 and 2019, respectively. (2)Primarily comprised of six MOBs with net real estate assets of $73 million and two MOBs with net real estate assets of $7 million as of December 31, 2020 and 2019, respectively. The results of discontinued operations through December 31, 2020, or the disposal date of each asset or portfolio of assets if they have been sold, are included in the consolidated results for the years ended December 31, 2020, 2019, and 2018. Summarized financial information for discontinued operations for the years ended December 31, 2020, 2019, and 2018 is as follows (in thousands):
| Year Ended December 31,
| 2020 |  | 2019 |  | 2018
Revenues: |  |  |  |  |
Rental and related revenues | $ | 97,877 |  |  | $ | 152,576 |  |  | $ | 216,887 |
Resident fees and services | 621,253 |  |  | 583,653 |  |  | 400,557 |
Income from direct financing leases | — |  |  | 20,815 |  |  | 37,926 |
Total revenues | 719,130 |  |  | 757,044 |  |  | 655,370 |
Costs and expenses: |  |  |  |  |
Interest expense | 10,538 |  |  | 8,007 |  |  | 5,062 |
Depreciation and amortization | 143,194 |  |  | 224,798 |  |  | 144,819 |
Operating | 550,226 |  |  | 474,126 |  |  | 326,381 |
Transaction costs | 20,426 |  |  | 6,780 |  |  | 9,635 |
Impairments and loan loss reserves (recoveries), net | 201,344 |  |  | 208,229 |  |  | 44,343 |
Total costs and expenses | 925,728 |  |  | 921,940 |  |  | 530,240 |
Other income (expense): |  |  |  |  |
Gain (loss) on sales of real estate, net | 460,144 |  |  | 22,940 |  |  | 94,618 |
Other income (expense), net | 5,475 |  |  | 17,060 |  |  | (110) |
Total other income (expense), net | 465,619 |  |  | 40,000 |  |  | 94,508 |
Income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures | 259,021 |  |  | (124,896) |  |  | 219,638 |
Income tax benefit (expense) | 9,913 |  |  | 11,783 |  |  | 13,459 |
Equity income (loss) from unconsolidated joint ventures | (1,188) |  |  | (2,295) |  |  | 3,159 |
Income (loss) from discontinued operations | $ | 267,746 |  |  | $ | (115,408) |  |  | $ | 236,256 |

X
- References No definition available. + Details
Name: | us-gaap_DiscontinuedOperationsAndDisposalGroupsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
Name: | us-gaap_DisposalGroupsIncludingDiscontinuedOperationsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration