Content analysis
?Positive | ||
Negative | ||
Uncertain | ||
Constraining | ||
Legalese | ||
Litigous | ||
Readability |
H.S. junior Avg
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New words:
Angelo, Arbor, attack, Austin, Bridgewood, Bryan, Cedar, collaborate, collaboration, compromise, conducive, Crossing, CSIRT, CTO, Curry, Desert, epidemic, extortion, floating, foreseeable, Fredericktowne, fulfill, HarborChase, harm, hoc, Huntington, incident, intellectual, intelligence, intrusion, Isle, Kamimac, Legacy, Midland, Monticello, MorningStar, network, NIST, overseen, penetration, phishing, postpone, Prestige, prioritized, privacy, Raider, random, reconciling, requisite, restoration, retrospectively, revised, Ridge, Riverwood, Rosemont, San, simulate, Southern, steady, Sweetwater, Symphony, tabletop, technology, Terrace, theft, thousand, threat, Town, Tranquillity, unscheduled, Village, vulnerability, Wellmore, West, William, Woodholme
Removed:
achievement, achieving, assume, automatically, continuity, declined, deferral, developer, enumerated, frequent, HHS, Human, Hurst, move, NNN, optional, outbreak, par, premium, promoted, proportional, protective, quotient, relaxed, renovation, screening, sector, shifted, speed, stabilization, stabilize, standard, subjected, Update, worked, World
Financial report summary
?Risks
- If the Company does not successfully implement a liquidity event, investors may have to hold an investment for an indeterminate period of time.
- In determining the Company’s estimated NAV per share, the Company primarily relied upon a valuation of the Company’s portfolio of properties and debt as of the end of the calendar year. Valuations and appraisals of the Company’s properties and outstanding debt are estimates of fair value and may not necessarily correspond to realizable value upon the sale of such properties. Therefore, the Company’s estimated NAV per share may not reflect the amount that would be realized upon a sale of each of the Company’s properties.
- Seniors housing properties in the Company’s portfolio may not be readily adaptable to other uses.
- The financial condition of our operators and tenants can impact the Company’s operating revenue.
- Events which adversely affect the ability of seniors to afford the Company’s daily resident fees could cause the occupancy rates, resident fee revenues and results of operations of the Company’s seniors housing properties to decline.
- Inflation could adversely impact the operating expenses of our tenants and operators.
- Inflation could rise at rates that outpace contractual or actual increases in rental income.
- There can be no assurance that the Company will be able to achieve expected cash flows necessary to pay or maintain distributions at any particular level or that distributions will continue over time.
- An investment return may be reduced if the Company is required to register as an investment company under the Investment Company Act.
- Cyber security risks and cyber incidents could adversely affect the Company’s business and disrupt operations.
- Damage from catastrophic weather and other natural events and climate change could result in losses to us.
- Discovery of previously undetected environmentally hazardous conditions may adversely affect our operating results.
- None of the agreements with the Advisor or any other affiliates were negotiated at arm’s length.
- If the Company internalizes the Company’s management functions, an interest in the Company could be diluted, the Company could incur other significant costs associated with being self-managed, and the Company may not be able to retain or replace key personnel and may have increased exposure to litigation.
- The Company is not in privity of contract with service providers that may be engaged by the Advisor to perform advisory services and they may be insulated from liabilities to the Company, and the Advisor has minimal assets with which to remedy any liabilities to the Company.
- Mortgage indebtedness and other borrowings will increase the Company’s business risks.
- Financing arrangements involving balloon payment obligations may adversely affect the Company’s ability to make distributions.
- The Company may acquire various financial instruments for purposes of “hedging” or reducing the Company’s risks which may be costly and/or ineffective and will reduce the Company’s cash available for distribution to its stockholders.
- The Company’s failure or the failure of the tenants and managers of the Company’s properties to comply with licensing and certification requirements, the requirements of governmental programs, fraud and abuse regulations or new legislative developments may materially adversely affect the operations of the Company’s seniors housing properties.
- Termination of resident lease agreements could adversely affect the Company’s revenues and earnings for seniors housing properties providing assisted living services.
- Legislation and government regulation may adversely affect the operations of the Company’s properties.
- Failure to qualify as a REIT would adversely affect the Company’s operations and the Company’s ability to pay distributions to investors.
- The Company’s leases may be re-characterized as financings which would eliminate depreciation deductions with respect to the Company’s properties.
- The Company may have to borrow funds or sell assets to meet the Company’s distribution requirements.
- Even as a REIT, the Company remains subject to various taxes which would reduce operating cash flow if and to the extent certain liabilities are incurred.
- The Company’s investment strategy may cause the Company to incur penalty taxes, fail to maintain the Company’s REIT status or own and sell properties through TRSs, each of which would diminish the return to the Company’s stockholders.
- The Company’s TRS structure subjects the Company to the risk that the leases with the Company’s TRSs do not qualify for tax purposes as arm’s-length, which would expose the Company to potentially significant tax penalties.
- If the Company’s operating partnership fails to maintain its status as a partnership, the operating partnership’s income may be subject to taxation, which would reduce the cash available to the Company for distribution to its stockholders.
- The lease of qualified health care properties to a TRS is subject to special requirements.
- If the Company’s assets are deemed “plan assets” for the purposes of the Employee Retirement Income Security Act (“ERISA”), the Company could be subject to excise taxes on certain prohibited transactions.
- The Company’s board of directors can take many actions without stockholder approval which could have a material adverse effect on the distributions investors receive from the Company and/or could reduce the value of the Company’s assets.
- The Company’s use of an operating partnership structure may result in potential conflicts of interest with limited partners other than the Company, if any, whose interests may not be aligned with those of the Company’s stockholders.
Management Discussion
- Except for the impact of elevated labor costs, inflation and a rising interest rate environment, we are not aware of other material trends or uncertainties, favorable or unfavorable, that may be reasonably anticipated to have a material impact on either capital resources or the revenues or income to be derived from the operation of properties, other than those referred to in the risk factors identified in “Part I, Item 1A” of this report.
- As of each of December 31, 2023 and 2022, excluding our vacant land, we owned 69 consolidated operating investment properties.
- Rental Income and Related Revenues. Rental income and related revenues were approximately $26.9 million and $26.9 million for the years ended December 31, 2023 and 2022, respectively.