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Investments, Acquisitions and Assets Held for Sale | 9 Months Ended
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Sep. 30, 2025
Business Combination [Abstract] |
Investments, Acquisitions and Assets Held for Sale | Investments, Acquisitions and Assets Held for Sale Investment in Consolidated VIE In July 2024, the Company entered into the Palatine JVs with affiliates of Palatine Capital Partners, which acquired four senior living communities located in Texas (3) and Georgia (1). The Company is a 51% owner in the joint ventures. The noncontrolling interest of the Palatine JVs is reported on the noncontrolling interest line items in the Company's condensed consolidated financial statements. Investment in Stone Unconsolidated Entity In May 2024, the Stone JV purchased four communities in the Midwest. KZ Stone Investor LLC is the controlling managing member of the Stone JV and owned 67.29% of the entity as of September 30, 2025. Sonida owned a 32.71% noncontrolling interest in the Stone JV as of September 30, 2025. Sonida operates the four communities for a management fee based on the gross revenues of the applicable communities, as well as an incentive management fee based on earnings before interest, taxes, depreciation, amortization, rent, and management fees, and other customary terms and conditions. The Company has evaluated its investment in the Stone JV under ASC 810 and determined that it does not have the power to direct the activities of the VIE that most significantly impact its economic performance and is not the primary beneficiary of the VIE. The Company's interests in the VIE are, therefore, accounted for under the equity method of accounting. The carrying amount of the Company's investment in the unconsolidated venture and maximum exposure to loss as a result of the Company’s ownership interest in the Stone JV was $9.3 million as of September 30, 2025, which is included in investment in unconsolidated entity on the accompanying condensed consolidated balance sheet. For the nine months ended September 30, 2025, the Company received a return of its investment of $0.6 million in its unconsolidated entity. The Company evaluates the realization of its investment in unconsolidated entities accounted for using the equity method if circumstances indicate the Company's investment is other than temporarily impaired. For the three and nine months ended September 30, 2025, there were no impairments with respect to the Company’s investment in the Stone JV. East Lake Acquisition On May 30, 2025, the Company acquired one senior living community located in Tarpon Springs, Florida for a purchase price of $11.0 million plus transaction costs of $0.3 million. The asset acquisition was recorded at relative fair value. The Company recorded $9.9 million in “Property and equipment, net” for tangible assets purchased; $1.6 million in “Intangible assets, net” for in-place leases; and $0.2 million in “Other long-term liabilities” for below market leases in the Company’s condensed consolidated balance sheets. The Company mortgaged the property with a $9.0 million loan. See “Note 7–Debt.” Alpharetta Acquisition On June 1, 2025, the Company acquired one senior living community located in Alpharetta, Georgia for a purchase price of $11.0 million plus transaction costs of $0.2 million. The asset acquisition was recorded at relative fair value. The Company recorded $9.1 million in “Property and equipment, net” for tangible assets purchased; $2.1 million in “Intangible assets, net” for in-place leases; and $0.1 million in “Other long-term liabilities” for below market leases in the Company’s condensed consolidated balance sheets. The Jasper Acquisition On September 4, 2025, the Company acquired one senior living community located in Mansfield, Texas for a purchase price of $15.6 million plus transaction costs of $0.1 million. The asset acquisition was recorded at relative fair value. The Company recorded $14.2 million in “Property and equipment, net” for tangible assets purchased and $1.5 million in “Intangible assets, net” for in-place leases in the Company’s condensed consolidated balance sheets. Assets and Liabilities Held for Sale As of September 30, 2025, the Company classified one of its communities as held for sale in its condensed consolidated balance sheets in accordance with ASC 360, following management’s decision to divest the property and actively market it for sale. During the three and nine months ended September 30, 2025, the Company recorded a non-cash impairment charge of $4.7 million to reduce the carrying value of the property to its estimated fair value less estimated disposal costs. The impairment charge is presented within impairment of assets held for sale in the Company’s condensed consolidated statement of operations. There were no impairments of long-lived assets for the three and nine months ended September 30, 2024. The reclassification of the property’s assets and liabilities held-for-sale status represents a presentation change within the balance sheet, rather than a new investing or financing transaction. The community did not meet the criteria for classification as a discontinued operation under ASC 205-20, as the sale does not represent a strategic shift that has or will have a major effect on the Company’s operations and financial results. The Company continues to actively market the community for sale, and no sale-related cash flows with respect to such community have been recognized as of September 30, 2025. The below summarizes the carrying amounts of the major classes of assets and liabilities classified as held for sale in the condensed consolidated balance sheet (in thousands):
|  | September 30, 2025 |  |
Assets held for sale |  |  |  |
Land |  | $ | 550 |  |  |
Land improvements |  | 108 |  |  |
Buildings and building improvements |  | 15,191 |  |  |
Furniture and equipment |  | 748 |  |  |
Automobiles |  | 11 |  |  |
Other |  | 96 |  |  |
Accumulated depreciation and amortization |  | (7,330) |  |  |
Total assets held for sale |  | $ | 9,374 |  |  |
Liabilities held for sale |  |  |  |
Fixed rate mortgage note payable |  | $ | 13,113 |  |  |
Accrued expenses |  | 400 |  |  |
Deferred income |  | 71 |  |  |
Total liabilities held for sale |  | $ | 13,584 |  |  |

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