XML 33 R16.htm IDEA: XBRL DOCUMENT

Lease Incentives

12 Months Ended

Dec. 31, 2023

8. Lease Incentives

Our non-contingent lease incentive balances at December 31, 2023 and 2022 were $2,607,000 and $1,789,000, respectively. The following table summarizes our non-contingent lease incentive activity for the years ended December 31, 2023, 2022 and 2021 (in thousands):


	Year Ended December 31,
		2023			2022			2021
Lease incentives funded	$	1,627	⁽¹⁾	$	418		$	824
Amortization of lease incentives		(773)			(877)			(608)
Adjustment for collectability of lease incentives		—			(256)	⁽²⁾		—
Other adjustments ⁽³⁾		(36)			(174)			—
Net increase (decrease) in non-contingent lease incentives	$	818		$	(889)		$	216

(1)	As part of our investment in a $54,134 JV, we committed to fund $2,100 of lease incentive, of which $1,458 was funded during 2023.

(2)	Represents the lease incentive balance write-off related to a closed property and subsequent lease termination and lease incentive balance write-off related to 12 ALFs transitioned to an existing operator.

(3)	Primarily relates to lease incentive balance write-off related to property sales.

Non-contingent lease incentives represent payments made to our lessees for various reasons including entering into a new lease or lease amendments and extensions. Contingent lease incentives represent potential contingent earn-out payments that may be made to our lessees in the future, as part of our lease agreements. From time to time, we may commit to provide contingent payments to our lessees, upon our properties achieving certain rent coverage ratios. Once the contingent payment becomes probable and estimable, the contingent payment is recorded as a lease incentive. Lease incentives are amortized as a yield adjustment to rental income over the remaining life of the lease.