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Real Estate Investments | 12 Months Ended
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Dec. 31, 2024
Real Estate Investments |
Real Estate Investments | 5. Real Estate Investments Owned Properties. As of December 31, 2024, we owned 123 health care real estate properties consisting of 72 assisted living communities, 50 skilled nursing centers and one behavioral health care hospital located in 23 states. These properties are operated by 23 operators. Independent living communities, assisted 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, number of units, number of beds, and yield on investments in real estate are unaudited and outside the scope of our independent registered public accounting firm’s audit of our consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board. Depreciation expense on buildings and improvements, including properties classified as held-for-sale, was $36,223,000, $37,303,000, and $37,394,000 for the years ended December 31, 2024, 2023 and 2022, respectively. Future minimum base rents receivable under the remaining non-cancelable terms of operating leases excluding the effects of straight-line rent, amortization of lease incentives and renewal options are as follows (in thousands):
​ | ​ | ​ | ​ | ​
​ |  | Cash |
​ | ​ | Rent (1) |
2025 | ​ | $ | 116,247 | ​
2026 | ​ |  | 100,188 | ​
2027 | ​ |  | 94,235 | ​
2028 | ​ |  | 83,178 | ​
2029 | ​ |  | 69,620 | ​
Thereafter | ​ |  | 108,855 | ​
(1) | Represents contractual cash rent, except for certain master leases which are based on estimated cash. Includes rent from subsequent extension of a master lease covering two SNFs in Tennessee that was schedule to mature in December 2025 for an additional year.
Many of our existing leases contain renewal options that, if exercised, could result in the amount of rent receivable upon renewal being greater or less than that currently being paid. During the fourth quarter of 2024, an operator notified us of its election not to exercise the renewal option on a master lease covering seven skilled nursing centers in California (1), Florida (2), and Virgina (4). The master lease matures in January 2026 and provides two 5-year renewal options. The operator is obligated to pay rent on the portfolio through maturity and is current on rent obligations through February 2025. Subsequent to December 31, 2024, we engaged a broker to sell or re-lease some or all of the properties in the portfolio. During 2024, a master lease covering 11 skilled nursing centers located in Texas with a total of 1,444 beds was amended to extend the lease term to December 31, 2028, with two five-year renewal options. The annual rent increased from $8,000,000 to $9,000,000 for 2024. Rent will increase to $9,500,000 in 2025, and $10,000,000 in 2026, escalating 3.1% annually thereafter. As a condition of the amended master lease, the operator paid $12,103,000 during 2024, towards its $13,531,000 working capital note. The remaining $1,428,000 balance of the working capital note is interest-free and will be repaid in installments through 2028. Additionally, during 2024, another operator exercised its renewal option under its master lease for five years, from March 2025 through February 2030. Annual cash rent for 2024 was $8,004,000 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. For leases where we have concluded it is not probable that we will collect substantially all the lease payments under those leases, recognition of rental income is limited to the lesser of the amount of cash collected or rental income reflected on a straight-line 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. We wrote-off straight-line rent receivable and lease incentives balances of $321,000, $26,000 and $256,000 for the years ended December 31, 2024, 2023 and 2022, respectively. Additionally, if our conclusion of collectibility changes, we will record the difference between the lease income that would have been recognized on a straight-line basis and cash basis as a current-period adjustment to rental income. We recorded $3,158,000 of straight-line rental income related to restoring accrual basis accounting for two master leases during 2024. We did not record any recovery of straight-line rental income during 2023 and 2022. We continue to take into account the current financial condition of our operators, in our estimation of uncollectible accounts and deferred rents receivable at December 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 years ended December 31, 2024, 2023 and 2022 (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year Ended December 31, | ​
Rental Income | ​ | ​ | 2024 | ​ | ​ | 2023 | ​ | ​ | 2022 | ​
Contractual cash rental income | ​ | $ | 118,198 | (1) | $ | 116,702 | (2) | $ | 115,230 | ​
Variable cash rental income | ​ | ​ | 12,951 | (3) | ​ | 13,525 | (3) | ​ | 15,516 | (3)
Straight-line rent | ​ | ​ | 2,268 | (4) | ​ | (2,078) | (5) | ​ | (1,369) | ​
Adjustment of lease incentives and rental income | ​ | ​ | (321) | (6) | ​ | (26) | (6) | ​ | (256) | (6)
Amortization of lease incentives | ​ | ​ | (818) | ​ | ​ | (773) | ​ | ​ | (877) | ​
Total | ​ | $ | 132,278 | ​ | $ | 127,350 | ​ | $ | 128,244 | ​
(1) | Increased primarily due to $2,377 repayment of rent credit in connection with the sale of our interest in a consolidated JV, rental income from 2023 acquisitions, annual rent escalations, partially offset by portfolio transitions and property sales.
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(2) | Increased primarily due to rental income from acquisitions, annual rent escalations, repayment of deferred rent, and fair market rent resets, partially offset by property sales.
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(3) | The variable cash rental income for the years ended December 31, 2024, 2023 and 2022 primarily includes reimbursement of real estate taxes by our lessees.
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(4) | Increased primarily due to a one-time additional straight-line rental income related to restoring accrual basis accounting for two master leases.
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(5) | Decreased primarily due to deferred rent repayment and normal amortization.
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(6) | Represents straight-line rent receivable and lease incentives write-offs.
​ 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 as of December 31, 2024 (dollar amount in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Type | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | of | ​ | of | ​ | ​ | Gross | ​ | ​ | Net Book | ​ | Option | ​
State | ​ | Property | ​ | Properties | ​ | ​ | Investments (1) | ​ | ​ | Value | ​ | Window | ​
Colorado/Kansas/Ohio/Texas | ​ | ALF/MC | ​ | 17 | ​ | $ | 65,134 | ​ | $ | 30,842 | ​ | 2029 | (2)
Florida | ​ | SNF | ​ | 3 | ​ | ​ | 76,603 | ​ | ​ | 76,603 | ​ | 2025-2027 | ​
Georgia/South Carolina | ​ | ALF/MC | ​ | 2 | ​ | ​ | 32,266 | ​ | ​ | 24,855 | ​ | 2027 | ​
North Carolina | ​ | ALF/MC | ​ | 11 | ​ | ​ | 121,419 | ​ | ​ | 121,419 | ​ | 2025-2029 | (3)
North Carolina | ​ | ALF | ​ | 5 | ​ | ​ | 14,980 | ​ | ​ | 7,086 | ​ | 2029 | (4)
North Carolina | ​ | ALF | ​ | 4 | ​ | ​ | 41,000 | ​ | ​ | 41,000 | ​ | 2024-2028 | (5)
North Carolina/ South Carolina | ​ | ILF/ALF/MC | ​ | 13 | ​ | ​ | 122,460 | ​ | ​ | 122,460 | ​ | 2024-2028 | (6)
Ohio | ​ | MC | ​ | 1 | ​ | ​ | 16,161 | ​ | ​ | 13,049 | ​ | 2024-2025 | ​
Ohio | ​ | ILF/ALF/MC | ​ | 1 | ​ | ​ | 54,782 | ​ | ​ | 51,331 | ​ | 2025-2027 | ​
Oklahoma | ​ | ALF/MC | ​ | 5 | ​ | ​ | 11,068 | ​ | ​ | 3,936 | ​ | 2027-2029 | (7)
South Carolina | ​ | ALF | ​ | 1 | ​ | ​ | 11,680 | ​ | ​ | 7,920 | ​ | 2026 | (8)
Texas | ​ | SNF | ​ | 4 | ​ | ​ | 52,726 | ​ | ​ | 48,980 | ​ | 2027-2029 | (9)
Texas | ​ | MC | ​ | 1 | ​ | ​ | 6,724 | ​ | ​ | 3,340 | ​ | 2026-2028 | (10)
Total (11) | ​ | ​ | ​ | ​ | ​ | $ | 627,003 | ​ | $ | 552,821 | ​ | ​ | ​
(1) | Gross investments include previously recorded impairment losses, if any.
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(2) | During 2023, we re-leased 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.
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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 Internal Rate of Return (“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.
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(5) | During 2024, we entered into a joint venture agreement with ALG Senior Living (“ALG”) and obtained a 92.7% controlling interest in the $41,000 newly formed JV that owns four ALFs in North Carolina with a total of 217 units. The JV leased the communities back to an affiliate of the seller under a 10-year master lease agreement. The master lease includes a purchase option that can be exercised through 2028, with an exit IRR of 8.0%. For more information regarding this transaction see Financing Receivables below.
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(6) | During 2024, we entered into a joint venture agreement with ALG and obtained a 52.6% controlling interest in the $122,460 newly formed JV that owns 13 ALFs and MCs in North Carolina (12) and South Carolina (1) with a total of 523 units. The JV leased the communities back to an affiliate of the seller under a 10-year master lease agreement. The master lease includes a purchase option that can be exercised through 2028, with an exit IRR of 8.0%. For more information regarding this transaction see Financing Receivables below.
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(7) | 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.
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(8) | During 2024, we transferred this community from ALG to an operator new to us. The new lease commenced in December 2024 and includes a purchase option that can be exercised in September 2026 through November 2026.
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(9) | 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 9. Commitments and Contingencies.
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(10) | During 2024, we transferred this community to an operator new to us. The new master lease commenced in April 2024 and includes a purchase option that can be exercised in May 2026 through April 2028, if the lessee exercises its one-year extension option. Subsequent to December 31, 2024, in conjunction with the closure of the community, this purchase option was terminated.
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(11) | Subsequent to December 31, 2024, a master lease covering two SNFs in Tennessee that was scheduled to mature in December 2025, was amended extending the maturity to December 31, 2026. Additionally, the master lease purchase option window which expired on December 31, 2024, was extended for another year to December 31, 2025.
Impairment Loss. We performed recoverability analysis on the carrying value of the communities listed in the table below and concluded that their carrying value may not be recoverable through future undiscounted cash flows. The following table summarizes information regarding impairment losses recorded during the years ended December 31, 2024, 2023 and 2022 (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | Number | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | of | ​ | of | ​ | of | ​ | Impairment | ​
Year | ​ | State | ​ | Properties | ​ | Properties | ​ | Beds/Units | ​ | Loss | ​
2024 | ​ | Ohio | ​ | ALF | ​ | 1 | ​ | 39 | ​ | $ | 780 | (1)
​ | ​ | Oklahoma | ​ | ALF | ​ | 1 | ​ | 29 | ​ | ​ | 153 | (2)
​ | ​ | Texas | ​ | ALF | ​ | 1 | ​ | 56 | ​ | ​ | 6,020 | (1)
​ | ​ | ​ | ​ | ​ | ​ | 3 | ​ | 124 | ​ | $ | 6,953 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
2023 | ​ | Florida | ​ | ALF | ​ | 1 | ​ | 70 | ​ | $ | 434 | (3)
​ | ​ | Florida | ​ | ALF | ​ | 1 | ​ | 60 | ​ | ​ | 7,522 | ​
​ | ​ | Mississippi | ​ | ALF | ​ | 1 | ​ | 67 | ​ | ​ | 4,554 | (4)
​ | ​ | Texas | ​ | ALF | ​ | 7 | ​ | 248 | ​ | ​ | 3,265 | ​
​ | ​ | ​ | ​ | ​ | ​ | 10 | ​ | 445 | ​ | $ | 15,775 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
2022 | ​ | Florida | ​ | ALF | ​ | 1 | ​ | 70 | ​ | $ | 1,222 | (3)
​ | ​ | Kentucky | ​ | ALF | ​ | 1 | ​ | 60 | ​ | ​ | 1,286 | (5)
​ | ​ | Colorado | ​ | ALF | ​ | 1 | ​ | — | ​ | ​ | 914 | (6)
​ | ​ | ​ | ​ | ​ | ​ | 3 | ​ | 130 | ​ | $ | 3,422 | ​
(1) | In conjunction with the anticipated closure, we recorded an impairment loss on the carrying value of these properties.
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(2) | Subsequent to December 31, 2024, this community was sold. See Properties Held-for-Sale below for more information regarding this community.
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(3) | In conjunction with the ongoing negotiations to sell this community, we recorded a $434 impairment loss during the three months ended March 31, 2023, and a $1,222 impairment loss during the fourth quarter of 2022. This community was sold during the second quarter of 2023 for $4,850 and we recorded a net gain on sale of $64 as a result of this transaction.
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(4) | This community was sold during the fourth quarter of 2023 for $1,650 and we recorded a net loss on sale of $219 as a result of this transaction.
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(5) | This community was classified as held-for sale at December 31, 2022 and sold during the first quarter of 2023 for $11,000. We recorded a net gain on sale of $57 as a result of this transaction.
(6) | This community was closed during 2022.
Properties Held-for-Sale. The following summarizes our held-for sale properties as of December 31, 2024 and 2023 (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | of | ​ | of | ​ | of | ​ | ​ | Gross | ​ | ​ | Accumulated | ​ | ​ | ​
​ | ​ | State | ​ | Property | ​ | Properties | ​ | Beds/units | ​ | ​ | Investment | ​ | ​ | Depreciation | ​ | ​ | ​
At December 31, 2024 | ​ | OK | ​ | ALF | (1) | 1 | ​ | 29 | ​ | $ | 2,016 | ​ | $ | (1,346) | ​ | ​ | ​
At December 31, 2023 | ​ | WI | ​ | ALF | (2) | 1 | ​ | 110 | ​ | $ | 22,007 | ​ | $ | (3,616) | ​ | ​ | ​
(1) | This community was sold during the first quarter of 2025. Upon sale, the community was removed from a master lease covering five ALFs in Oklahoma and rent under the master lease was not reduced as a result of the sale.
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(2) | This community was sold during the first quarter of 2024.
​ ​ Acquisitions. The following table summarizes our acquisitions for the years ended December 31, 2024 through 2022 (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Cash | ​ | ​ | ​ | ​ | Non- | ​ | ​ | ​ | ​ | ​ | ​ | Number | ​ | Number
​ | ​ | ​ | ​ | Paid at | ​ | Assumed | ​ | ​ | Controlling | ​ | Transaction | ​ | ​ | Assets | ​ | of | ​ | of
Year | ​ | Type of Property | ​ | Acquisition | ​ | Liabilities | ​ | ​ | Interest | ​ | Costs | ​ | ​ | Acquired | ​ | Properties | ​ | Beds/Units
2024 | ​ | OTH (1) | ​ | $ | 300 | ​ | $ | — | ​ | $ | — | ​ | $ | 19 | ​ | $ | 319 | ​ | — | ​ | —
2023 | ​ | ALF (2) | ​ | $ | 43,759 | ​ | $ | 9,767 | ​ | $ | 9,133 | ​ | $ | 363 | ​ | $ | 63,022 | (3) | 1 | ​ | 242
2022 | ​ | SNF (4) | ​ | $ | 51,817 | ​ | $ | — | ​ | $ | ​ | ​ | $ | — | ​ | $ | 51,817 | ​ | 4 | ​ | 339
(1) | We acquired a parcel of land in Kansas adjacent to an existing community operated by Brookdale Senior Living Communities (“Brookdale”). Rent was increased by 8.0% of our total cost of the investment.
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(2) | We entered into a $54,134 JV and contributed $45,000 into the JV that purchased an ILF/ALF/MC in Ohio. Under the JV agreement, the seller, our JV partner, has the option to purchase the campus between the third and fourth lease years for LTC’s allocation of the JV investment plus an IRR of 9.75%. The campus was leased to Encore Senior Living (“Encore”) under a 10-year term with an initial yield of 8.25% on LTC’s allocation of the JV investment. LTC committed to fund $2,100 of lease incentives under the Encore lease.
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(3) | Includes $8,309 tax abatement intangible included in the Prepaid expenses and other assets line item in our Consolidated Balance Sheets.
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(4) | The properties are located in Texas and are leased to an affiliate of an existing operator under a 10-year lease with two 5-year renewal options. Additionally, the lease provides either an earn-out payment or purchase option but not both. If neither option is elected within the timeframe defined in the lease, both elections are terminated. The earn-out payment is available, contingent on achieving certain thresholds per the lease, beginning at the end of the second lease year through the end of the fifth lease year. The purchase option is available beginning in the sixth lease year through the end of the seventh lease year. The initial cash yield is 8% for the first year, increasing to 8.25% for the second year, then increases annually by 2.0% to 4.0% based on the change in the Medicare Market Basket Rate.
Intangible Assets. The following is a summary of our intangible assets as of December 31, 2024 and 2023 (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31, 2024 | ​ | December 31, 2023
​ | ​ | ​ | ​ | ​ | ​ | ​ | Accumulated | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Accumulated | ​ | ​ | ​ | ​
Assets | ​ | ​ | Cost | ​ | ​ | ​ | Amortization | ​ | ​ | ​ | Net | ​ | ​ | Cost | ​ | ​ | ​ | Amortization | ​ | ​ | ​ | Net
In-place leases | ​ | $ | 11,047 | (1) | ​ | $ | (6,758) | (2) | ​ | $ | 4,289 | ​ | $ | 11,348 | (1) | ​ | $ | (6,109) | (2) | ​ | $ | 5,239
Tax abatement intangible | ​ | $ | 8,309 | (3) | ​ | $ | (1,097) | (3) | ​ | $ | 7,212 | ​ | $ | 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.
The following table provides future amortization expenses related to the intangible assets at December 31, 2024 (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Total |  | 2025 |  | 2026 |  | 2027 |  | 2028 |  | 2029 |  | Thereafter
In-place leases (1) | ​ | $ | 4,289 | ​ | $ | 872 | ​ | $ | 696 | ​ | $ | 633 | ​ | $ | 519 | ​ | $ | 493 | ​ | $ | 1,076
Tax abatement intangible (2) | ​ |  | 7,212 | ​ |  | 692 | ​ |  | 692 | ​ |  | 692 | ​ |  | 692 | ​ |  | 692 | ​ |  | 3,752
​ | ​ | $ | 11,501 | ​ | $ | 1,564 | ​ | $ | 1,388 | ​ | $ | 1,325 | ​ | $ | 1,211 | ​ | $ | 1,185 | ​ | $ | 4,828
(1) | Recorded as depreciation expense included in the Depreciation and amortization line item on our Consolidated Statements of Income.
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(2) | Recorded as Property tax expense on our Consolidated Statements of Income.
​ Developments and Improvements. During the years ended December 31, 2024, 2023 and 2022, we invested the following in development and improvement projects (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year Ended December 31, | ​
Type of Property | ​ | 2024 | ​ | 2023 | ​ | ​ | 2022 | ​
​ | ​ | Developments | ​ | Improvements | ​ | Developments | ​ | Improvements | ​ | ​ | Developments | ​ | Improvements | ​
Assisted Living Communities | ​ | $ | — | ​ | $ | 12,431 | ​ | $ | — | ​ | $ | 3,112 | ​ | ​ | $ | 105 | ​ | $ | 5,538 | ​
Skilled Nursing Centers | ​ | ​ | — | ​ | ​ | 1,246 | ​ | ​ | — | ​ | ​ | 6,487 | ​ | ​ | ​ | — | ​ | ​ | 2,897 | ​
Other | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 87 | ​ | ​ | ​ | — | ​ | ​ | 559 | ​
Total | ​ | $ | — | ​ | $ | 13,677 | ​ | $ | — | ​ | $ | 9,686 | ​ | ​ | $ | 105 | ​ | $ | 8,994 | ​
​ Property Sales. During the years ended December 31, 2024, 2023 and 2022 we recorded net gain on sale of real estate of $7,979,000, $37,296,000 and $37,830,000, respectively. The following table summarizes property sales during the years ended December 31, 2024, 2023 and 2022 (dollar amounts in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Type | ​ | Number | ​ | Number | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | of | ​ | of | ​ | of | ​ | ​ | Sales | ​ | ​ | Carrying | ​ | ​ | Net | ​
Year | ​ | State | ​ | Properties | ​ | Properties | ​ | Beds/Units | ​ | ​ | Price | ​ | ​ | Value | ​ | ​ | (Loss) Gain (2) | ​
2024 (1) | ​ | Colorado | ​ | ALF | ​ | 1 | ​ | — | ​ | $ | 5,250 | ​ | $ | 4,058 | ​ | $ | 1,097 | ​
​ | ​ | Florida | ​ | ALF | ​ | 1 | ​ | 60 | ​ | ​ | 4,500 | ​ | ​ | 4,579 | ​ | ​ | (289) | ​
​ | ​ | Texas | ​ | ALF | ​ | 5 | ​ | 208 | ​ | ​ | 1,600 | ​ | ​ | 1,282 | ​ | ​ | (390) | ​
​ | ​ | Texas | ​ | ALF | ​ | 2 | ​ | — | ​ | ​ | 500 | ​ | ​ | 389 | ​ | ​ | — | ​
​ | ​ | Texas | ​ | ALF | ​ | 1 | ​ | 80 | ​ | ​ | 7,959 | (3) | ​ | 4,314 | ​ | ​ | 3,635 | ​
​ | ​ | Wisconsin | ​ | ALF | ​ | 1 | ​ | 110 | ​ | ​ | 20,193 | (4) | ​ | 16,195 | ​ | ​ | 3,986 | ​
​ | ​ | n/a | ​ | n/a | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (60) | (5)
Total | ​ | ​ | ​ | ​ | ​ | 11 | ​ | 458 | ​ | $ | 40,002 | ​ | $ | 30,817 | ​ | $ | 7,979 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
2023 | ​ | Florida | ​ | ALF | ​ | 5 | ​ | 246 | ​ | $ | 23,600 | ​ | $ | 9,084 | ​ | $ | 13,327 | ​
​ | ​ | Kentucky | ​ | ALF | ​ | 1 | ​ | 60 | ​ | ​ | 11,000 | ​ | ​ | 10,720 | ​ | ​ | 57 | ​
​ | ​ | Mississippi | ​ | ALF | ​ | 1 | ​ | 67 | ​ | ​ | 1,650 | ​ | ​ | 1,639 | ​ | ​ | (220) | ​
​ | ​ | New Jersey | ​ | ALF | ​ | 1 | ​ | 39 | ​ | ​ | 2,000 | ​ | ​ | 1,552 | ​ | ​ | 266 | ​
​ | ​ | New Mexico | ​ | SNF | ​ | 2 | ​ | 235 | ​ | ​ | 21,250 | ​ | ​ | 5,523 | ​ | ​ | 15,287 | ​
​ | ​ | Nebraska | ​ | ALF | ​ | 3 | ​ | 117 | ​ | ​ | 2,984 | ​ | ​ | 2,934 | ​ | ​ | — | ​
​ | ​ | Oklahoma | ​ | ALF | ​ | 1 | ​ | 37 | ​ | ​ | 800 | ​ | ​ | 777 | ​ | ​ | 11 | ​
​ | ​ | Pennsylvania | ​ | ALF | ​ | 2 | ​ | 130 | ​ | ​ | 11,128 | ​ | ​ | 6,054 | ​ | ​ | 4,860 | ​
​ | ​ | South Carolina | ​ | ALF | ​ | 3 | ​ | 128 | ​ | ​ | 8,409 | ​ | ​ | 4,446 | ​ | ​ | 3,708 | ​
Total | ​ | ​ | ​ | ​ | ​ | 19 | ​ | 1,059 | ​ | $ | 82,821 | ​ | $ | 42,729 | ​ | $ | 37,296 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
2022 | ​ | California | ​ | ALF | ​ | 2 | ​ | 232 | ​ | $ | 43,715 | ​ | $ | 17,832 | ​ | $ | 25,867 | ​
​ | ​ | California | ​ | SNF | ​ | 1 | ​ | 121 | ​ | ​ | 13,250 | ​ | ​ | 1,846 | ​ | ​ | 10,846 | ​
​ | ​ | Texas | ​ | SNF | ​ | 1 | ​ | — | ​ | ​ | 485 | ​ | ​ | 697 | ​ | ​ | (441) | ​
​ | ​ | Virginia | ​ | ALF | ​ | 1 | ​ | 74 | ​ | ​ | 16,895 | ​ | ​ | 15,549 | ​ | ​ | 1,344 | (6)
​ | ​ | n/a | ​ | n/a | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 214 | (7)
Total | ​ | ​ | ​ | ​ | ​ | 5 | ​ | 427 | ​ | $ | 74,345 | ​ | $ | 35,924 | ​ | $ | 37,830 | ​
(1) | Subsequent to December 31, 2024, we sold a 29-unit assisted living community in Oklahoma for $670. Upon sale, the property was removed from a master lease covering five ALFs in Oklahoma and rent under the master lease was not reduced as a result of the sale. At December 31, 2024, the community was classified as held-for-sale.
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(2) | Calculation of net gain (loss) includes cost of sales and write-off of straight-line rent receivable and lease incentives, when applicable.
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(3) | As part of the negotiated sale, we received an additional $441 representing rental income through lease maturity in January 2025.
​
(4) | 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.
​
(5) | We recognized additional loss due to additional incurred costs related to properties sold during 2023.
​
(6) | In connection with this sale, the former operator paid us a lease termination fee of $1,181 which is not included in the gain on sale.
​
(7) | We recognized additional gain due to the reassessment adjustment of the holdbacks related to properties sold during 2020 and 2019, under the expected value model per ASC Topic 606, Contracts with Customers.
Financing Receivables. We have entered into joint ventures (“JV”) and contributed into the JVs for the acquisition of properties through sale and leaseback transactions. Concurrently, each of these JVs leased the properties acquired 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. See Note 2. Summary of Significant Accounting Policies within our consolidated financial statements for more information. The following table provides information regarding our investments in financing receivables (dollar amounts in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Type | ​ | Number | ​ | Number | ​ | ​ | Investment
Interest | ​ | Investment | ​ | ​ | ​ | ​ | ​ | ​ | Gross | ​ | ​ | LTC | ​ | of | ​ | of | ​ | of | ​ | ​ | per
Rate | ​ | Year | ​ | Maturity | ​ | State | ​ | ​ | Investments | ​ | ​ | Investment | ​ | Properties | ​ | Properties | ​ | Beds/Units | ​ | ​ | Bed/Unit
7.25% | (1) | 2022 | ​ | 2032 | ​ | FL | ​ | $ | 76,603 | ​ | $ | 62,278 | ​ | SNF | ​ | 3 | ​ | 299 | ​ | $ | 256.20
7.25% | (2) | 2023 | ​ | 2033 | ​ | NC | ​ | ​ | 121,419 | ​ | ​ | 117,588 | ​ | ALF/MC | ​ | 11 | ​ | 523 | ​ | $ | 232.16
7.25% | (3) | 2024 | ​ | 2034 | ​ | NC/SC | ​ | ​ | 122,460 | ​ | ​ | 64,450 | ​ | ILF/ALF/MC | ​ | 13 | ​ | 523 | ​ | $ | 234.15
7.25% | (4) | 2024 | ​ | 2034 | ​ | NC | ​ | ​ | 41,000 | ​ | ​ | 37,985 | ​ | ALF | ​ | 4 | ​ | 217 | ​ | $ | 188.94
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 361,482 | ​ | $ | 282,301 | ​ | ​ | ​ | 31 | ​ | 1,562 | ​ | ​ | ​
(1) | During 2022, we entered into a JV with an operator new to us. The JV purchased three SNFs and 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.
​
(2) | During 2023, we entered into a JV with ALG Senior living (“ALG”). The JV purchased 11 ALFs and MCs and 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 Consumer Price Index(“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 IRR of 9.0%. During 2024, we deferred a total of $3,014 consolidated JV interest income from financing receivables for May through December 2024.
​
(3) | During the second quarter of 2024, we funded an additional $5,546 under a mortgage loan receivable due from an ALG affiliate secured by 13 ALFs and MCs located in North Carolina (12) and South Carolina (1). We then entered into a newly formed $122,460 JV with ALG, whereby we exchanged our $64,450 mortgage loan receivable for a 53% controlling interest in the JV. Concurrently, ALG contributed these properties to the joint venture for a 47% non-controlling interest. The properties were recorded at fair value, and the fair value of certain properties was determined using the income and sales comparison approaches. The income approach utilized stabilized property net operating income and a direct capitalization rate. The sales comparison approach utilized comparable property sales on a per bed basis. The JV leased the properties to an ALG affiliate under a 10-year master lease, with two five-year renewal options and provided the seller-lessee with a purchase option exercisable through 2028, with an exit IRR of 8.0%.
​
(4) | During the second quarter of 2024, we funded an additional $2,766 under a mortgage loan receivable due from an ALG affiliate secured by four ALFs located in North Carolina. We then entered into a newly formed $41,000 JV with ALG, whereby we exchanged $37,985 mortgage loan receivables for a 93% controlling interest in the JV. Concurrently, ALG contributed these properties and a parcel of land to the joint venture for a 7% non-controlling interest. The properties were recorded at fair value, and the fair value of the properties was determined using the income approach. The JV leased the properties to an ALG affiliate under a 10-year master lease, with two five-year renewal options and provided the seller-lessee with a purchase option exercisable through 2028, with an exit IRR of 8.0%.
​ The following table summarizes the interest income from our investment in financing receivables during the years ended December 31, 2024, 2023 and 2022 (dollar amounts in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Type | ​ | Initial | ​ | Interest Income from Financing Receivables
Lease | ​ | of | ​ | Contractual | ​ | Year Ended December 31,
Maturity | ​ | Properties | ​ | Cash Yield | ​ | ​ | 2024 | ​ | ​ | 2023 | ​ | ​ | 2022
2032 | ​ | SNF | ​ | 7.25 | % | ​ | $ | 5,611 | ​ | $ | 5,618 | ​ | $ | 1,762
2033 | ​ | ALF/MC | ​ | 7.25 | % | ​ | ​ | 9,710 | ​ | ​ | 9,625 | ​ | ​ | —
2034 | ​ | ILF/ALF/MC | ​ | 7.25 | % | ​ | ​ | 4,751 | ​ | ​ | — | ​ | ​ | —
2034 | ​ | ALF | ​ | 7.25 | % | ​ | ​ | 1,591 | ​ | ​ | — | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 21,663 | ​ | $ | 15,243 | ​ | $ | 1,762
​ Mortgage Loans. The following table summarizes our investments in mortgage loans secured by first mortgages at December 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 (2) | ​ | Properties (3) | ​ | Beds | ​ | Units | ​ | Bed/Unit
8.8% | ​ | 2025 | ​ | FL | ​ | $ | 4,000 | ​ | ALF | ​ | 1.3 | % | 1 | ​ | 2 | ​ | — | ​ | 92 | ​ | $ | 43.48
7.8% | ​ | 2025 | ​ | FL | ​ | ​ | 16,706 | ​ | ALF | ​ | 5.3 | % | 1 | ​ | 1 | ​ | — | ​ | 112 | ​ | $ | 149.16
7.3% | ​ | 2025 | ​ | NC | ​ | ​ | 10,750 | ​ | ALF | ​ | 3.4 | % | 1 | ​ | 1 | ​ | — | ​ | 45 | ​ | $ | 238.89
8.8% | ​ | 2026 | ​ | MI | ​ | ​ | 12,753 | ​ | ALF | ​ | 4.1 | % | 1 | ​ | 1 | ​ | — | ​ | 85 | ​ | $ | 150.04
8.8% | ​ | 2028 | ​ | IL | ​ | ​ | 16,500 | ​ | SNF | ​ | 5.2 | % | 1 | ​ | 1 | ​ | 150 | ​ | — | ​ | $ | 110.00
11.1% (4) | ​ | 2043 | ​ | MI | ​ | ​ | 180,700 | ​ | SNF | ​ | 57.2 | % | 1 | ​ | 14 | ​ | 1,749 | ​ | — | ​ | $ | 103.32
10.0% (4) | ​ | 2045 | ​ | MI | ​ | ​ | 39,800 | ​ | SNF | ​ | 12.6 | % | 1 | ​ | 4 | ​ | 480 |  | — | ​ | $ | 82.92
10.3% (4) | ​ | 2045 | ​ | MI | ​ |  | 19,700 | ​ | SNF | ​ | 6.2 | % | 1 | ​ | 2 | ​ | 201 |  | — | ​ | $ | 98.01
10.5% (4) | ​ | 2045 | ​ | MI | ​ | ​ | 14,825 | ​ | SNF | ​ | 4.7 | % | 1 | ​ | 1 | ​ | 146 | ​ | — | ​ | $ | 101.54
Total | ​ | ​ | ​ | ​ | ​ | $ | 315,734 | (1) | ​ | ​ | 100.0 | % | 9 | ​ | 27 | ​ | 2,726 |  | 334 | ​ | $ | 103.18
(1) | Excludes the impact of credit loss reserve.
​
(2) | Some loans contain certain guarantees and/or provide for certain facility fees.
​
(3) | Our mortgage loans are secured by properties located in four states with six borrowers. Additionally, during 2024, we committed to fund a $26,120 mortgage loan for the construction of a 116-unit independent living, assisted living and memory care community in Illinois. The borrower contributed $12,300 of equity which will initially fund the construction. Once all of the borrower’s equity has been drawn, we will begin funding the commitment. The loan term is approximately six years at a current rate of 9.0% and an IRR of 9.5%.
​
(4) | Mortgage loans provide for 2.25% annual increases in the interest rate after a certain time period.
​ ​ The following table summarizes our mortgage loan activity for the years ended December 31, 2024, 2023 and 2022 (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year Ended December 31, | ​
​ | ​ | 2024 | ​ | 2023 | ​ | 2022 |
Originations and funding under mortgage loans receivable | ​ | $ | 21,833 | (1) | $ | 97,058 | (4) | $ | 40,732 | (5)
Exchange of mortgage loans for controlling interests in joint ventures accounted for as financing receivables | ​ | ​ | (102,435) | (2) | ​ | — | ​ | ​ | — | ​
Pay-offs received | ​ | ​ | (85,204) | (3) | ​ | — | ​ | ​ | — | ​
Application of interest reserve | ​ | ​ | 169 | ​ | ​ | 1,722 | ​ | ​ | 6,192 | ​
Scheduled principal payments received | ​ | ​ | (701) | ​ | ​ | (10,351) | ​ | ​ | (1,175) | ​
Mortgage loan premium amortization | ​ | ​ | (8) | ​ | ​ | (7) | ​ | ​ | (6) | ​
Recovery (provision) for loan loss reserve | ​ | ​ | 1,663 | ​ | ​ | (884) | ​ | ​ | (457) | ​
Net (decrease) increase in mortgage loans receivable | ​ | $ | (164,683) | ​ | $ | 87,538 | ​ | $ | 45,286 | ​
​
(1) | The following funding occurred during 2024:
​
| (a) | $12,753 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 $6,747. 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;
​
| (b) | $5,546 of additional funding under a mortgage loan receivable agreement with an ALG affiliate secured by 13 ALFs and MCs in North Carolina (12) and South Carolina (1). During the three months ended June 30, 2024, we exchanged this $64,450 mortgage loan receivable for a controlling interest in a JV investment with an ALG affiliate. See Financing Receivables above for more information;
​
| (c) | $2,766 of additional funding under a mortgage loan receivable agreement with an ALG affiliate secured by four ALFs in North Carolina. During the three months ended June 30, 2024, we exchanged this $37,985 mortgage loan receivable for a controlling interest in a JV investment with an ALG affiliate. See Financing Receivables above for more information; and
​
| (d) | $768 of additional funding under various loans.
​
(2) | The following occurred:
​
| (a) | $64,450 mortgage loan receivable due from an ALG affiliate was exchanged for a controlling interest in a JV. See (1)(b) above for more information; and
​
| (b) | $37,985 mortgage loan receivable due from an ALG affiliate was exchanged for a controlling interest in a JV. See (1)(c) above for more information.
​
(3) | The following payoffs/paydowns were received during 2024:
| (a) | The payoff of a $51,111 mortgage loan receivable secured by a 203-unit ILF, ALF and MC in Georgia;
​
| (b) | The payoff of a $2,013 mortgage loan secured by a parcel of land in Missouri;
​
| (c) | The payoff of a $29,347 mortgage loan secured by a 189-bed SNF in Louisiana; and
​
| (d) | A partial principal paydown of $2,733 related to the sale of a SNF securing the mortgage loan previously secured by 15 SNFs in Michigan.
​
(4) | We originated the following during 2023:
​
| (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%;
​
| (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. 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. The mortgage loan was paid off during 2024;
​
| (c) | $16,500 senior loan for the acquisition of a 150-bed Medicare focused SNF in Illinois. The mortgage loan matures in June 2028 and our investment is at an interest rate of 8.75%;
​
| (d) | $4,947 of contractual additional funding under other mortgage loans receivable;
​
| (e) | $13,750 of seller financing collateralized by four ALFs. $9,750 was repaid subsequently and two ALFs were released from collateral. The net $4,000 seller-financed mortgage loan is for two-years, with a one-year extension, at the interest rate of 8.75%; and
​
| (f) | $19,500 mortgage loan commitment for the construction of an 85-unit ALF and MC in Michigan. The borrower contributed
|  | $12,100 of equity which initially funded the construction. Upon fully drawing of the borrower’s equity in the first quarter of 2024, we began funding the commitment. The 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.
​
(5) | We originated two senior mortgage loans, secured by four ALFs operated by an existing operator, as well as a land parcel in North Carolina. The communities have a combined total of 217 units, with an average age of less than four years. The land parcel is approximately 7.6 acres adjacent to one of the ALFs and is being held for the future development of a seniors housing community. The mortgage loans have a four-year term, an interest rate of 7.25% and an IRR of 8%. We also funded an additional $2,000 under an existing mortgage loan.
​ At December 31, 2024 and 2023 the carrying values of the mortgage loans, net of loan loss reserves were $312,583,000 and $477,266,000, respectively. Scheduled principal payments on mortgage loan receivables are as follows (in thousands): ​
​ | ​ | ​ | ​ | ​
​ |  | Scheduled |
​ | ​ | Principal |
2025 | ​ | $ | 32,136 | ​
2026 | ​ |  | 13,434 | ​
2027 | ​ |  | 680 | ​
2028 | ​ |  | 17,180 | ​
2029 | ​ |  | 680 | ​
Thereafter | ​ |  | 251,624 | ​
Total | ​ | $ | 315,734 | ​
​ ​

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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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