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Investment in Unconsolidated Joint Ventures (Tables)

12 Months Ended

Dec. 31, 2024

Investment in Unconsolidated Joint Ventures

Summary of the preferred equity investments

Type

Total

Contractual

Number

of

Preferred

Cash

of

Carrying

State

Properties

Investment

Return

Portion

Beds/ Units

Value

Texas

SNF/ALF

Senior Loan

⁽¹⁾

9.2

%

9.2

%

104

$

11,262

⁽¹⁾

Washington

ALF/MC

Preferred Equity

⁽²⁾

12.0

%

9.0

%

109

6,340

⁽²⁾

Washington

ILF/ALF

Preferred Equity

⁽³⁾

14.0

%

8.0

%

267

13,000

⁽³⁾

Total

480

$

30,602

(1)

We originated a $12,700 mortgage loan to a current operator secured by a SNF/ALF in Texas. The investment commitment amount includes $11,164, funded during 2024, an interest reserve of $750 and a capital expenditure reserve of $786. In accordance with GAAP, this mortgage loan was determined to be an ADC loan and is accounted for as an unconsolidated JV. The campus has 104 beds (70 skilled nursing and 34 assisted living). The five-year mortgage loan is interest-only.

(2)

Our investment represents 15.5% of the total investment. The preferred equity investment earns an initial cash rate of 7%, increasing to 9% in year four until the IRR is 8%. After achieving an 8% IRR, the cash rate drops to 8% with an IRR ranging between 12% to 14%, depending upon timing of redemption. We have the option to require the JV partner to purchase our preferred equity interest at any time between August 17, 2031 and December 31, 2036.

(3)

Our investment represents 11.0% of the total investment. The preferred equity investment earns an initial cash rate of 8% with an IRR of 14%. The JV partner has the option to buy out our investment at any time after August 31, 2023 at the IRR rate. Also, we have the option to require the JV partner to purchase our preferred equity interest at any time between August 31, 2027 and prior to the end of the first renewal term of the lease.

Summary of capital contributions, income recognized and cash interest received from investments in unconsolidated joint ventures

The following table summarizes our capital contributions, income recognized, and cash interest received related to our investments in unconsolidated joint ventures during the years ended December 31, 2024, 2023 and 2022 (in thousands):


	Type
	of		Income		Cash Income		Non-cash
Year	Properties		Recognized		Earned		Income Accrued
2024	SNF/ALF	$	884	$	884	$	—
	ALF/MC		504		504		—
	ILF/ALF ⁽¹⁾		1,054		—		1,054
Total		$	2,442	$	1,388	$	1,054

2023	ALF/MC	$	450	$	56	$	394
	ILF/ALF ⁽¹⁾		1,054		—		1,054
Total		$	1,504	$	56	$	1,448

2022	ALF/MC	$	450	$	—	$	450
	UDP ⁽¹⁾		1,054		351		703
Total		$	1,504	$	351	$	1,153

(1)	The JV developed and owns a 267-unit ILF and ALF in Washington. The development project was completed during the fourth quarter of 2023.