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Real Estate Investments | 3 Months Ended
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Mar. 31, 2024
Real Estate Investments |
Real Estate Investments |
2. | Real Estate Investments
Assisted living communities, independent living communities, memory care communities and combinations thereof are included in the assisted living property classification (collectively “ALF”). Any reference to the number of properties or facilities, number of units, number of beds, number of operators and yield on investments in real estate are unaudited and outside the scope of our independent registered public accounting firm’s review of our consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board. Owned Properties. Our owned properties are leased pursuant to non-cancelable operating leases. Each lease is a triple net lease which requires the lessee to pay all taxes, insurance, maintenance and repairs, capital and non-capital expenditures and other costs necessary in the operations of the facilities. Many of the leases contain renewal options. The majority of our leases contain provisions for specified annual increases over the rents of the prior year. The following table summarizes our investments in owned properties at March 31, 2024 (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Average |
​ | ​ | ​ | ​ | ​ | Percentage | ​ | Number | ​ | Number of | ​ | Investment |
​ | ​ | Gross | ​ | of | ​ | of | ​ | SNF | ​ | ALF | ​ | per |
Type of Property | ​ | Investment | ​ | Investment | ​ | Properties (1) | ​ | Beds (2) | ​ | Units (2) | ​ | Bed/Unit |
Assisted Living | ​ | $ | 733,901 | ​ | 54.6 | % | 76 | ​ | — | ​ | 4,421 | ​ | $ | 166.00 | ​
Skilled Nursing | ​ | ​ | 597,015 | ​ | 44.5 | % | 50 | ​ | 6,113 | ​ | 236 | ​ | $ | 94.03 | ​
Other (3) | ​ | ​ | 12,005 | ​ | 0.9 | % | 1 | ​ | 118 | ​ | — | ​ | ​ | — | ​
Total | ​ | $ | 1,342,921 | ​ | 100.0 | % | 127 | ​ | 6,231 | ​ | 4,657 | ​ | ​ | ​ | ​
(1) | We own properties in 23 states that are leased to 23 different operators.
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(2) | Includes three parcels of land held-for-use, and one behavioral health care hospital.
Many of our existing leases contain renewal options that, if exercised, could result in the amount of rent payable upon renewal being greater or less than that currently being paid. During 2023, Brookdale Senior Living Communities, Inc. (“Brookdale”) elected not to exercise its renewal option under a master lease that matured on December 31, 2023. The 35- property assisted living portfolio was apportioned as follows (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | ​ | Number | ​ | ​ | First | ​ | ​ | ​ | ​ | ​
Lease | ​ | ​ | ​ | of | ​ | of | ​ | ​ | of | ​ | ​ | Year | ​ | ​ | Lease | ​ | ​
Commencement | ​ | State | ​ | Property | ​ | Properties | ​ | ​ | Units | ​ | ​ | Rent | ​ | ​ | Term | ​ | ​
November 2023 | ​ | OK | ​ | ALF | ​ | 5 | (1) | ​ | 184 | ​ | $ | 960 | ​ | ​ | Three years | ​ | ​
January 2024 | ​ | CO, KS, OH, TX | ​ | ALF | ​ | 17 | (2) | ​ | 738 | ​ | ​ | 9,325 | ​ | ​ | Six years | ​ | ​
January 2024 | ​ | NC | ​ | ALF | ​ | 5 | (3) | ​ | 210 | ​ | ​ | 3,300 | ​ | ​ | Six years | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | 27 | ​ | ​ | 1,132 | ​ | $ | 13,585 | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | of | ​ | of | ​ | ​ | of | ​ | ​ | Sales | ​ | ​ | Net | ​ | ​
Year sold | ​ | State | ​ | Property | ​ | Properties | ​ | ​ | Units | ​ | ​ | Price | ​ | ​ | Proceeds (4) | ​ | ​
2023 | ​ | FL | ​ | ALF | ​ | 4 | ​ | ​ | 176 | ​ | $ | 18,750 | ​ | $ | 14,310 | (5) | ​
2023 | ​ | OK | ​ | ALF | ​ | 1 | ​ | ​ | 37 | ​ | ​ | 800 | ​ | ​ | 769 | ​ | ​
2023 | ​ | SC | ​ | ALF | ​ | 3 | ​ | ​ | 128 | ​ | ​ | 8,409 | ​ | ​ | 8,153 | ​ | ​
​ | ​ | ​ | ​ | ALF | ​ | 8 | ​ | ​ | 341 | ​ | $ | 27,959 | ​ | $ | 23,232 | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total | ​ | ​ | ​ | ​ | ​ | 35 | ​ | ​ | 1,473 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(1) | These communities were transitioned to an existing LTC operator. The new master lease includes a purchase option that can be exercised starting in November 2027 through October 2029 if the lessee exercises its four-year extension option. Rent increases to $984 in the second year, and $1,150 in the third year.
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(2) | These communities were re-leased to Brookdale under a new master lease. Rent escalates by approximately 2.0% annually. The new master lease includes a purchase option that can be exercised in 2029. We also agreed to fund $7,200 for capital expenditures for the first two years of the lease at an initial rate of 8.0% escalating by approximately 2.0% annually thereafter.
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(3) | These communities were transitioned to an operator new to us. Rent escalates by approximately 3.0% annually.
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(4) | Net of transaction costs and seller financing, if any.
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(5) | We provided seller financing collateralized by two of the Florida properties, with a total of 92 units. The $4,000 seller-financed mortgage loan has a two-year term, with a one-year extension, at an interest rate of 8.75%.
During the three months ended March 31, 2024, a master lease covering 11 skilled nursing centers, that was scheduled to mature in January 2024, was renewed for seven months extending the maturity to August 2024. The master lease was renewed at the current annualized rent of $8,000,000, or $4,667,000 for seven months in 2024. The centers have a total of 1,444 beds and are located in Texas. Subsequent to March 31, 2024, we executed a term sheet with the operator, to amend the master lease extending the term through December 2028. Annual rent will increase by $1,000,000 to $9,000,000 for 2024. Rent will increase to $9,500,000 for 2025, and $10,000,000 for 2026, escalating 3.3% annually thereafter. The amended master lease provides the operator with two five-year renewal options. As a condition of the amendment, the operator will repay $11,900,000 on its $13,531,000 working capital note during the second quarter of 2024. Upon the repayment, the remaining balance of the working capital note will be interest-free and repaid in installments through 2028. Additionally, subsequent to March 31, 2024, another operator exercised its renewal option under its master lease for five years, from March 2025 through February 2030. Annual cash and GAAP rent for 2024 are $8,004,000 and $7,049,000, respectively escalating 2.5% annually. The master lease covers 666 beds across four skilled nursing centers, three in Texas and one in Wisconsin, and a behavioral health care hospital in Nevada. We monitor the collectability of our receivable balances, including deferred rent receivable balances, on an ongoing basis. We write-off uncollectible operator receivable balances, including straight- line rent receivable and lease incentives balances, as a reduction to rental income in the period such balances are no longer probable of being collected. Therefore, recognition of rental income is limited to the lesser of the amount of cash collected or rental income reflected on a “straight-line” basis for those customer receivable balances deemed uncollectible. We wrote-off straight-line rent receivable and lease incentives balances of $191,000 and $144,000 for the three months ended March 31, 2024 and 2023, respectively, as a result of property sales and lease terminations. We continue to take into account the current financial condition of our operators, including consideration of the impact of COVID-19, in our estimation of uncollectible accounts at March 31, 2024. We are closely monitoring the collectability of such rents and will adjust future estimations as appropriate as further information becomes known. The following table summarizes components of our rental income for the three months ended March 31, 2024 and 2023 (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​
​ | ​ | March 31, | ​
Rental Income | ​ | ​ | 2024 | ​ | ​ | 2023 | ​
Contractual cash rental income | ​ | $ | 30,951 | (1) | $ | 29,125 | (1)
Variable cash rental income | ​ | ​ | 3,381 | (2) | ​ | 3,284 | (2)
Straight-line rent | ​ | ​ | (550) | ​ | ​ | (465) | ​
Amortization of lease incentives | ​ | ​ | (233) | ​ | ​ | (209) | ​
Total | ​ | $ | 33,549 | ​ | $ | 31,735 | ​
(1) | Increased primarily due to $2,377 repayment of rent credit in connection with the sale of our interest in a consolidated joint venture (“JV), rental income from 2023 acquisitions and annual rent escalations, partially offset by property sales and transitioned portfolios.
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(2) | The variable rental income for the three months ended March 31, 2024, and 2023 includes reimbursement of real estate taxes by our lessees.
​ Some of our lease agreements provide purchase options allowing the lessees to purchase the properties they currently lease from us. The following table summarizes information about purchase options included in our lease agreements (dollar amounts in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Type | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | of | ​ | of | ​ | ​ | Gross | ​ | ​ | Net Book | ​ | Option | ​
State | ​ | Property | ​ | Properties | ​ | ​ | Investments (1) | ​ | ​ | Value | ​ | Window | ​
California | ​ | ALF/MC | ​ | 2 | ​ | $ | 38,895 | ​ | $ | 32,542 | ​ | 2023-2029 | ​
Colorado/Kansas/Ohio/Texas | ​ | ALF/MC | ​ | 17 | ​ | ​ | 58,723 | ​ | ​ | 26,089 | ​ | 2029 | (2)
Florida | ​ | SNF | ​ | 3 | ​ | ​ | 76,669 | ​ | ​ | 76,669 | ​ | 2025-2027 | ​
Georgia/South Carolina | ​ | ALF/MC | ​ | 2 | ​ | ​ | 31,433 | ​ | ​ | 24,682 | ​ | 2027 | ​
North Carolina | ​ | ALF/MC | ​ | 11 | ​ | ​ | 121,321 | ​ | ​ | 121,321 | ​ | 2025-2028 | (3)
North Carolina | ​ | ALF | ​ | 5 | ​ | ​ | 14,404 | ​ | ​ | 6,844 | ​ | 2029 | (4)
Ohio | ​ | MC | ​ | 1 | ​ | ​ | 16,161 | ​ | ​ | 13,378 | ​ | 2024-2025 | ​
Ohio | ​ | ILF/ALF/MC | ​ | 1 | ​ | ​ | 54,758 | ​ | ​ | 52,946 | ​ | 2025-2027 | ​
Oklahoma | ​ | ALF/MC | ​ | 5 | ​ | ​ | 11,221 | ​ | ​ | 4,332 | ​ | 2027-2029 | (5)
Tennessee | ​ | SNF | ​ | 2 | ​ | ​ | 5,275 | ​ | ​ | 2,227 | ​ | 2023-2024 | ​
Texas | ​ | SNF | ​ | 4 | ​ | ​ | 52,726 | ​ | ​ | 50,036 | ​ | 2027-2029 | (6)
Total | ​ | ​ | ​ | ​ | ​ | $ | 481,586 | ​ | $ | 411,066 | ​ | ​ | ​
(1) | Gross investments include previously recorded impairment losses, if any.
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(2) | During 2023, we released 17 ALFs with a total of 738 units to Brookdale under a new six-year master lease. The new master lease commenced in January 2024 and includes a purchase option that can be exercised in 2029. See above for more information.
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(3) | During 2023, we entered into a JV that purchased 11 ALFs and MCs with a total of 523 units and leased the communities under a 10-year master lease. The master lease provides the operator with the option to buy up to 50% of the properties at the beginning of the third lease year, and the remaining properties at the beginning of the fourth lease year through the end of the sixth lease year, with an exit IRR of 9.0% on any portion of the properties being purchased. For more information regarding this transaction see Financing Receivables below.
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(4) | During 2023, we transferred five ALFs with a total of 210 units from Brookdale to an operator new to us. The new master lease commenced in January 2024 and includes a purchase option that can be exercised in 2029. See above for more information.
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(5) | During 2023, we transferred five ALFs in Oklahoma with a total of 184 units from Brookdale to an existing operator. The new master lease commenced in November 2023 and includes a purchase option that can be exercised starting in November 2027 through October 2029 if the lessee exercises its four-year extension option. See above for more information.
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(6) | During 2022, we purchased four skilled nursing centers and leased these properties under a 10-year lease with an existing operator. The lease allows the operator to elect either an earn-out payment or purchase option. If neither option is elected within the timeframe defined in the lease, both elections are terminated. For more information regarding the earn-out see Note 8. Commitments and Contingencies.
Impairment Loss. In conjunction with the planned sale of a 70-unit assisted living community located in Florida, we recorded a $434,000 impairment loss during the three months ended March 31, 2023. Properties Held -for-Sale. The following summarizes our held-for-sale properties as of March 31, 2024 and December 31, 2023 (dollar amounts in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | of | ​ | of | ​ | of | ​ | ​ | Gross | ​ | ​ | Accumulated | ​
​ | ​ | State | ​ | Property | ​ | Properties | ​ | Beds/units | ​ | ​ | Investment | ​ | ​ | Depreciation | ​
At March 31, 2024 | ​ | TX | ​ | ALF | (1) | 2 | ​ | n/a | (1) | $ | 3,162 | ​ | $ | 2,773 | ​
At December 31, 2023 | ​ | WI | ​ | ALF | (2) | 1 | ​ | 110 | ​ | $ | 22,007 | ​ | $ | 3,616 | ​
(1) | These closed properties were sold subsequent to March 31, 2024.
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(2) | This community was sold during the three months ended March 31, 2024.
​ Acquisitions. During the three months ended March 31, 2024, we acquired a parcel of land in Kansas adjacent to an existing community operated by Brookdale for a total cost of $315,000. Rent was increased by 8% of our total cost of the investment. During the three months ended March 31, 2023, we did not have any acquisitions. Intangible Assets. We make estimates as part of our allocation of the purchase price of acquisitions to various components of acquisition based upon the fair value of each component. In determining fair value, we use current appraisals or other third-party opinions of value. The most significant components of our allocations are typically the allocation of fair value to land and buildings, and for certain of our acquisitions, in-place leases and other intangible assets. In the case of the value of in-place leases, we make the best estimates based on the evaluation of the specific characteristics of each tenant’s lease. Factors considered include estimates of carrying costs during the hypothetical expected lease-up periods, market conditions and costs to execute similar leases. The following is a summary of the carrying amount of intangible assets as of March 31, 2024 and December 31, 2023 (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | March 31, 2024 | ​ | December 31, 2023
​ | ​ | ​ | ​ | ​ | ​ | ​ | Accumulated | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Accumulated | ​ | ​ | ​ | ​
Assets | ​ | ​ | Cost | ​ | ​ | ​ | Amortization | ​ | ​ | ​ | Net | ​ | ​ | Cost | ​ | ​ | ​ | Amortization | ​ | ​ | ​ | Net
In-place leases | ​ | $ | 11,155 | (1) | ​ | $ | (6,218) | (2) | ​ | $ | 4,937 | ​ | $ | 11,348 | (1) | ​ | $ | (6,109) | (2) | ​ | $ | 5,239
Tax abatement intangible | ​ | $ | 8,309 | (3) | ​ | $ | (578) | (3) | ​ | $ | 7,731 | ​ | $ | 8,309 | (3) | ​ | $ | (405) | (3) | ​ | $ | 7,904
(1) | Included in the Buildings and improvements line item in our Consolidated Balance Sheets.
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(2) | Included in the Accumulated depreciation and amortization line item in our Consolidated Balance Sheets.
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(3) | Included in the Prepaid expenses and other assets line item in our Consolidated Balance Sheets.
Improvements. During the three months ended March 31, 2024 and 2023, we invested in the following capital improvement projects (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended March 31,
Type of Property | ​ | 2024 | ​ | ​ | 2023 | ​
Assisted Living Communities | ​ | $ | 1,133 | ​ | ​ | $ | 1,548 | ​
Skilled Nursing Centers | ​ | ​ | 196 | ​ | ​ | ​ | 973 | ​
Other | ​ | ​ | — | ​ | ​ | ​ | 87 | ​
Total | ​ | $ | 1,329 | ​ | ​ | $ | 2,608 | ​
​ Properties Sold. During the three months ended March 31, 2024 and 2023, we recorded a gain on sale of $3,251,000 and $15,373,000, respectively. The following table summarizes property sales during the three months ended March 31, 2024 and 2023 (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | of | ​ | of | ​ | of | ​ | ​ | Sales | ​ | ​ | Carrying | ​ | ​ | Net | ​
Year | ​ | State | ​ | Properties | ​ | Properties | ​ | Beds/Units | ​ | ​ | Price | ​ | ​ | Value | ​ | ​ | (Loss) Gain (1) | ​
2024 | ​ | Florida | ​ | ALF | ​ | 1 | ​ | 60 | ​ | $ | 4,500 | ​ | $ | 4,579 | ​ | $ | (319) | ​
​ | ​ | Texas | ​ | ALF | ​ | 5 | ​ | 208 | ​ | ​ | 1,600 | ​ | ​ | 1,282 | ​ | ​ | (356) | ​
​ | ​ | Wisconsin | ​ | ALF | ​ | 1 | ​ | 110 | ​ | ​ | 20,193 | (2) | ​ | 16,195 | ​ | ​ | 3,986 | ​
​ | ​ | n/a | ​ | n/a | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (60) | (3)
Total | ​ | ​ | ​ | ​ | ​ | 7 | ​ | 378 | ​ | $ | 26,293 | ​ | $ | 22,056 | ​ | $ | 3,251 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
2023 | ​ | Kentucky | ​ | ALF | ​ | 1 | ​ | 60 | ​ | $ | 11,000 | ​ | $ | 10,710 | ​ | $ | 72 | ​
​ | ​ | New Mexico | ​ | SNF | ​ | 2 | ​ | 235 | ​ | ​ | 21,250 | ​ | ​ | 5,379 | ​ | ​ | 15,301 | ​
Total | ​ | ​ | ​ | ​ | ​ | 3 | ​ | 295 | ​ | $ | 32,250 | ​ | $ | 16,089 | ​ | $ | 15,373 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(
(1) | Calculation of net gain includes cost of sales and write-off of straight-line receivable and lease incentives, when applicable.
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(2) | Represents the price to sell our portion of interest in a JV, net of the JV partner’s $2,305 contributions in the joint venture.
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(3) | We recognized additional loss due to additional incurred costs related to properties sold during 2023.
​ Financing Receivables. During 2023 and 2022, we entered into two joint ventures and contributed into the JVs for the purchase of properties through sale and leaseback transactions. Concurrently, each of these JVs leased the purchased properties back to an affiliate of the seller and provided the seller-lessee with purchase options. We determined that each of these sale and leaseback transactions meet the accounting criteria to be presented as Financing receivables on our Consolidated Balance Sheets and recorded the rental revenue from these properties as Interest income from financing receivables on our Consolidated Statements of Income. The following tables provide information regarding our investments in financing receivables (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​
Investment | ​ | ​ | ​ | of | ​ | of | ​ | of | ​ | ​ | Gross | ​ | ​ | LTC
Year | ​ | State | ​ | Properties | ​ | Properties | ​ | Beds/Units | ​ | ​ | Investments | ​ | ​ | Contributions
2023 | ​ | NC | ​ | ALF/MC | ​ | 11 | ​ | 523 | ​ | $ | 121,321 | ​ | $ | 117,490
2022 | ​ | FL | ​ | SNF | ​ | 3 | ​ | 299 | ​ | ​ | 76,669 | ​ | ​ | 62,344
​ | ​ | ​ | ​ | ​ | ​ | 14 | ​ | 822 | ​ | $ | 197,990 | ​ | $ | 179,834
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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | Type | ​ | Initial | ​ | Interest Income from Financing Receivables
Lease | ​ | ​ | of | ​ | Contractual | ​ | Three Months Ended March 31,
Maturity | ​ | ​ | Properties | ​ | Cash Yield | ​ | ​ | 2024 | ​ | ​ | 2023
2033 | (1) | ​ | ALF/MC | ​ | 7.25 | % | ​ | $ | 2,426 | ​ | $ | 2,345
2032 | (2) | ​ | SNF | ​ | 7.25 | % | ​ | ​ | 1,404 | ​ | ​ | 1,406
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 3,830 | ​ | $ | 3,751
(1) | The JV leased these communities back to an affiliate of the seller under a 10-year master lease, with two five-year renewal options. The contractual initial cash yield of 7.25% increases to 7.5% in year three then escalates thereafter based on CPI subject to a floor of 2.0% and a ceiling of 4.0%. The JV provided the seller-lessee with a purchase option to buy up to 50% of the properties at the beginning of the third lease year and the remaining properties at the beginning of the fourth lease year through the end of the sixth lease year, with an exit Internal Rate of Return (“IRR”) of 9.0%.
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(2) | The JV leased the centers back to an affiliate of the seller under a 10-year master lease, with two five-year renewal options and provided the seller-lessee with a purchase option, exercisable at the beginning of the fourth year through the end of the fifth year.
Mortgage Loans. The following table sets forth information regarding our investments in mortgage loans secured by first mortgages at March 31, 2024 (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Type | ​ | Percentage | ​ | Number of | ​ | Investment
​ | ​ | ​ | ​ | ​ | ​ | Gross | ​ | of | ​ | of | ​ | ​ | ​ | ​ | ​ | SNF | ​ | ALF | ​ | per
Interest Rate | ​ | Maturity | ​ | State | ​ | Investment | ​ | Property | ​ | Investment | ​ | Loans (1) | ​ | Properties (2) | ​ | Beds | ​ | Units | ​ | Bed/Unit
7.5% | ​ | 2024 | ​ | MO | ​ | $ | 2,013 | ​ | OTH | ​ | 0.4 | % | 1 | ​ | — | (3) | — | ​ | — | ​ | $ | n/a
7.5% | ​ | 2024 | ​ | LA | ​ | ​ | 29,346 | ​ | SNF | ​ | 6.0 | % | 1 | ​ | 1 | ​ | 189 | ​ | — | ​ | $ | 155.27
7.5% | ​ | 2024 | ​ | GA | ​ | ​ | 51,111 | ​ | ALF | ​ | 10.5 | % | 1 | ​ | 1 | ​ | — | ​ | 203 | ​ | $ | 251.78
8.8% | ​ | 2025 | ​ | FL | ​ | ​ | 4,000 | ​ | ALF | ​ | 0.8 | % | 1 | ​ | 2 | ​ | — | ​ | 92 | ​ | $ | 43.48
7.8% | ​ | 2025 | ​ | FL | ​ | ​ | 16,706 | ​ | ALF | ​ | 3.5 | % | 1 | ​ | 1 | ​ | — | ​ | 112 | ​ | $ | 149.16
7.3% | ​ | 2025 | ​ | NC | ​ | ​ | 10,750 | ​ | ALF | ​ | 2.2 | % | 1 | ​ | 1 | ​ | — | ​ | 45 | ​ | $ | 238.89
7.3% (4) | ​ | 2025 | ​ | NC/SC | ​ | ​ | 58,519 | ​ | ALF | ​ | 12.1 | % | 1 | ​ | 13 | ​ | — | ​ | 523 | ​ | $ | 111.89
7.3% (4) | ​ | 2026 | ​ | NC | ​ | ​ | 34,043 | ​ | ALF | ​ | 7.0 | % | 1 | ​ | 4 | ​ | — | ​ | 217 | ​ | $ | 156.88
7.3% (4) | ​ | 2026 | ​ | NC | ​ | ​ | 826 | ​ | OTH | ​ | 0.2 | % | 1 | ​ | — | (5) | — | ​ | — | ​ | $ | n/a
8.8% (6) | ​ | 2026 | ​ | MI | ​ | ​ | 2,940 | ​ | UDP | ​ | 0.6 | % | 1 | ​ | — | (6) | — | ​ | — | ​ | $ | n/a
8.8% | ​ | 2028 | ​ | IL | ​ | ​ | 16,500 | ​ | SNF | ​ | 3.4 | % | 1 | ​ | 1 | ​ | 150 | ​ | — | ​ | $ | 110.00
10.8% (7) | ​ | 2043 | ​ | MI | ​ | ​ | 183,966 | ​ | SNF | ​ | 37.9 | % | 1 | ​ | 15 | ​ | 1,875 | ​ | — | ​ | $ | 98.12
9.8% (7) | ​ | 2045 | ​ | MI | ​ | ​ | 39,850 | ​ | SNF | ​ | 8.2 | % | 1 | ​ | 4 | ​ | 480 |  | — | ​ | $ | 83.02
10.1% (7) | ​ | 2045 | ​ | MI | ​ |  | 19,700 | ​ | SNF | ​ | 4.1 | % | 1 | ​ | 2 | ​ | 201 |  | — | ​ | $ | 98.01
10.5% (7) | ​ | 2045 | ​ | MI | ​ | ​ | 14,825 | ​ | SNF | ​ | 3.1 | % | 1 | ​ | 1 | ​ | 146 | ​ | — | ​ | $ | 101.54
Total | ​ | ​ | ​ | ​ | ​ | $ | 485,095 | ​ | ​ | ​ | 100.0 | % | 15 | ​ | 46 | ​ | 3,041 |  | 1,192 | ​ | $ | 114.60
(1) | Some loans contain certain guarantees and provide for certain facility fees.
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(2) | Our mortgage loans are secured by properties located in eight states with nine borrowers.
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(3) | Represents a mortgage loan secured by a parcel of land for the future development of a 91-bed post-acute SNF.
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(4) | Represents the initial rate with an IRR of 8%.
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(5) | Represents a mortgage loan secured by a parcel of land in North Carolina held for future development of a seniors housing community.
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(6) | During the third quarter of 2023, we committed to fund a $19,500 mortgage loan for the construction of an 85-unit ALF and MC in Michigan. The borrower contributed $12,100 of equity, which initially funded the construction. In 2024, once all of the borrower’s equity was drawn, we began funding the commitment. Our remaining commitment is $16,600. The interest-only loan term is approximately three years at a rate of 8.75%, and includes two, one-year extensions, each of which is contingent on certain coverage thresholds.
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(7) | Mortgage loans provide for 2.25% annual increases in the interest rate.
​ ​ The following table summarizes our mortgage loan activity for the three months ended March 31, 2024 and 2023 (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended March 31,
​ | ​ | 2024 | ​ | ​ | 2023 | ​
Originations and funding under mortgage loans receivable | ​ | $ | 3,128 | (1) | ​ | $ | 62,844 | (2)
Application of interest reserve | ​ | ​ | 14 | ​ | ​ | ​ | 1,149 | ​
Scheduled principal payments received | ​ | ​ | (125) | ​ | ​ | ​ | (125) | ​
Mortgage loan premium amortization | ​ | ​ | (2) | ​ | ​ | ​ | (2) | ​
Provision for loan loss reserve | ​ | ​ | (31) | ​ | ​ | ​ | (639) | ​
Net increase in mortgage loans receivable | ​ | $ | 2,984 | ​ | ​ | $ | 63,227 | ​
(1) | We funded the following:
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| (a) | $2,940 under a $19,500 mortgage loan commitment for the construction of an 85-unit ALF and MC in Michigan. The borrower contributed $12,100 of equity upon origination in July 2023, which was used to initially fund the construction. Our remaining commitment is $16,600. The interest-only loan term is approximately three years at a rate of 8.75%, and includes two, one-year extensions, each of which is contingent on certain coverage thresholds; and
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| (b) | $188 of additional funding under other mortgage loan receivables.
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(2) | We originated and funded the following:
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| (a) | $10,750 mortgage loan secured by a 45-unit MC located in North Carolina. The loan carries a two-year term with an interest-only rate of 7.25% and an IRR of 9.0%;
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| (b) | $51,111 mortgage loan investment secured by a 203-unit ILF, ALF and MC located in Georgia. We acquired a participating interest owned by existing lenders for $42,251 in addition to converting our $7,461 mezzanine loan in the property into a participating interest in the mortgage loan. The mortgage loan matures in October 2024 and our investment is at an initial rate of 7.5% with an IRR of 7.75%. We recorded $1,380 of additional interest income in connection with the effective prepayment of the mezzanine loan in the first quarter of 2023; and
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| (c) | $983 of additional funding under other mortgage loans receivable.
​

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- Definition The entire disclosure for real estate owned (as defined). Generally, the largest component of real estate owned by lenders is assets taken in settlement of troubled loans through surrender or foreclosure. Real estate investments, real estate loans that qualify as investments in real estate, and premises that are no longer used in operations may also be included in real estate owned. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Section 45 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org//1943274/2147481990/310-10-45-3 + Details
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