UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SeptemberJune 30, 20212022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE TRANSITION PERIOD FROM____________TO____________
Commission file number: 1-10989
Ventas, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware61-1055020
(State or Other Jurisdiction of Incorporation or Organization)(I.R.S. Employer Identification No.)
353 N. Clark Street, Suite 3300
Chicago, Illinois
60654
(Address of Principal Executive Offices)    
(877) 483-6827
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Exchange on Which Registered
Common Stock $0.25 par valueVTRNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes     No 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes     No 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company Emerging growth company  
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐    No 

As of November 4, 2021,August 3, 2022, there were 399,175,892399,712,763 shares of the registrant’s common stock outstanding.
    



VENTAS, INC.
FORM 10-Q
INDEX
  Page
 
Consolidated Balance Sheets as of SeptemberJune 30, 20212022 and December 31, 20202021
Consolidated Statements of Income for the Three and NineSix Months Ended SeptemberJune 30, 20212022 and 20202021
Consolidated Statements of Comprehensive Income for the Three and NineSix Months Ended SeptemberJune 30, 20212022 and 20202021
Consolidated Statements of Equity for the Three and NineSix Months Ended SeptemberJune 30, 20212022 and 20202021
Consolidated Statements of Cash Flows for the NineSix Months Ended SeptemberJune 30, 20212022 and 20202021



PART I—FINANCIAL INFORMATION

ITEM 1.    CONSOLIDATED FINANCIAL STATEMENTS

VENTAS, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)(In thousands, except per share amounts, unaudited)
As of September 30, 2021As of December 31, 2020
(In thousands, except per share amounts)
Assets
Real estate investments:  
Land and improvements$2,395,751 $2,261,415 
Buildings and improvements25,519,840 24,323,279 
Construction in progress298,982 265,748 
Acquired lease intangibles1,372,462 1,230,886 
Operating lease assets323,950 346,372 
29,910,985 28,427,700 
Accumulated depreciation and amortization(8,118,990)(7,877,665)
Net real estate property21,791,995 20,550,035 
Secured loans receivable and investments, net530,439 605,567 
Investments in unconsolidated real estate entities507,880 443,688 
Net real estate investments22,830,314 21,599,290 
Cash and cash equivalents143,770 413,327 
Escrow deposits and restricted cash52,752 38,313 
Goodwill1,046,070 1,051,650 
Assets held for sale316,769 9,608 
Deferred income tax assets, net11,496 9,987 
Other assets643,253 807,229 
Total assets$25,044,424 $23,929,404 
Liabilities and equity  
Liabilities:  
Senior notes payable and other debt$12,078,835 $11,895,412 
Accrued interest90,013 111,444 
Operating lease liabilities199,551 209,917 
Accounts payable and other liabilities1,142,822 1,133,066 
Liabilities related to assets held for sale20,518 3,246 
Deferred income tax liabilities65,196 62,638 
Total liabilities13,596,935 13,415,723 
Redeemable OP unitholder and noncontrolling interests280,344 235,490 
Commitments and contingencies00
Equity:  
Ventas stockholders’ equity:  
Preferred stock, $1.00 par value; 10,000 shares authorized, unissued— — 
Common stock, $0.25 par value; 600,000 shares authorized, 399,177 and 374,609 shares issued at September 30, 2021 and December 31, 2020, respectively99,777 93,635 
Capital in excess of par value15,504,210 14,171,262 
Accumulated other comprehensive loss(67,601)(54,354)
Retained earnings (deficit)(4,459,630)(4,030,376)
Treasury stock, 1 and 0 shares at September 30, 2021 and December 31, 2020, respectively(40)— 
Total Ventas stockholders’ equity11,076,716 10,180,167 
Noncontrolling interests90,429 98,024 
Total equity11,167,145 10,278,191 
Total liabilities and equity$25,044,424 $23,929,404 

As of June 30, 2022As of December 31, 2021
Assets
Real estate investments:  
Land and improvements$2,444,519 $2,432,065 
Buildings and improvements26,186,712 25,778,490 
Construction in progress251,300 269,315 
Acquired lease intangibles1,361,671 1,369,747 
Operating lease assets315,896 317,858 
30,560,098 30,167,475 
Accumulated depreciation and amortization(8,834,315)(8,350,637)
Net real estate property21,725,783 21,816,838 
Secured loans receivable and investments, net529,630 530,126 
Investments in unconsolidated real estate entities533,705 523,465 
Net real estate investments22,789,118 22,870,429 
Cash and cash equivalents127,073 149,725 
Escrow deposits and restricted cash48,958 46,872 
Goodwill1,044,509 1,046,140 
Assets held for sale31,768 28,399 
Deferred income tax assets, net11,152 11,152 
Other assets575,577 565,069 
Total assets$24,628,155 $24,717,786 
Liabilities and equity  
Liabilities:  
Senior notes payable and other debt$12,328,140 $12,027,544 
Accrued interest104,419 106,602 
Operating lease liabilities194,241 197,234 
Accounts payable and other liabilities1,062,935 1,090,254 
Liabilities related to assets held for sale5,871 10,850 
Deferred income tax liabilities46,613 59,259 
Total liabilities13,742,219 13,491,743 
Redeemable OP unitholder and noncontrolling interests282,542 280,283 
Commitments and contingencies00
Equity:  
Ventas stockholders’ equity:  
Preferred stock, $1.00 par value; 10,000 shares authorized, unissued— — 
Common stock, $0.25 par value; 600,000 shares authorized, 399,715 and 399,420 shares issued at June 30, 2022 and December 31, 2021, respectively99,913 99,838 
Capital in excess of par value15,514,015 15,498,956 
Accumulated other comprehensive loss(56,355)(64,520)
Retained earnings (deficit)(5,044,569)(4,679,889)
Treasury stock, 7 and 0 shares issued at June 30, 2022 and December 31, 2021, respectively(408)— 
Total Ventas stockholders’ equity10,512,596 10,854,385 
Noncontrolling interests90,798 91,375 
Total equity10,603,394 10,945,760 
Total liabilities and equity$24,628,155 $24,717,786 
See accompanying notes.
1



VENTAS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)(In thousands, except per share amounts, unaudited)
For the Three Months Ended September 30,For the Nine Months Ended September 30,
2021202020212020
For the Three Months Ended June 30,For the Six Months Ended June 30,
(In thousands, except per share amounts) 2022202120222021
RevenuesRevenues  Revenues  
Rental income:Rental income:  Rental income:  
Triple-net leasedTriple-net leased$181,379 $156,136 $500,487 $527,238 Triple-net leased$149,397 $159,223 $300,958 $319,108 
OfficeOffice201,673 198,376 599,516 599,696 Office199,241 200,388 399,781 397,843 
383,052 354,512 1,100,003 1,126,934 348,638 359,611 700,739 716,951 
Resident fees and servicesResident fees and services558,039 541,322 1,622,641 1,667,421 Resident fees and services658,056 535,952 1,309,177 1,064,602 
Office building and other services revenueOffice building and other services revenue5,841 3,868 16,172 10,669 Office building and other services revenue4,326 5,381 8,275 10,331 
Income from loans and investmentsIncome from loans and investments28,729 18,666 65,404 62,203 Income from loans and investments10,752 17,665 20,599 36,675 
Interest and other incomeInterest and other income417 572 1,343 6,965 Interest and other income1,166 585 1,702 926 
Total revenuesTotal revenues976,078 918,940 2,805,563 2,874,192 Total revenues1,022,938 919,194 2,040,492 1,829,485 
ExpensesExpenses  Expenses  
InterestInterest108,816 115,505 329,634 355,333 Interest113,951 110,051 224,745 220,818 
Depreciation and amortizationDepreciation and amortization313,596 249,366 878,444 847,797 Depreciation and amortization283,075 250,700 572,139 564,848 
Property-level operating expenses:Property-level operating expenses:Property-level operating expenses:
Senior living453,659 422,653 1,296,301 1,265,362 
Senior housingSenior housing507,446 424,813 982,976 842,642 
OfficeOffice66,401 66,934 195,297 192,192 Office63,328 64,950 126,511 128,896 
Triple-net leasedTriple-net leased3,268 5,398 12,525 17,004 Triple-net leased3,585 4,432 7,593 9,257 
523,328 494,985 1,504,123 1,474,558 574,359 494,195 1,117,080 980,795 
Office building services costs522 557 1,798 1,827 
Office building and other services costsOffice building and other services costs1,410 658 2,723 1,276 
General, administrative and professional feesGeneral, administrative and professional fees30,259 32,081 101,156 100,621 General, administrative and professional fees32,915 30,588 75,913 70,897 
Loss on extinguishment of debt, net29,792 7,386 56,808 7,386 
Loss (gain) on extinguishment of debt, netLoss (gain) on extinguishment of debt, net(74)27,016 
Merger-related expenses and deal costs22,662 11,325 28,000 26,129 
Transaction expenses and deal costsTransaction expenses and deal costs13,078 721 33,070 5,338 
Allowance on loans receivable and investmentsAllowance on loans receivable and investments(60)4,999 (9,021)34,654 Allowance on loans receivable and investments(62)(59)(116)(8,961)
OtherOther33,673 5,681 10,755 16,750 Other48,116 (13,490)20,926 (22,918)
Total expensesTotal expenses1,062,588 921,885 2,901,697 2,865,055 Total expenses1,066,849 873,290 2,046,487 1,839,109 
(Loss) income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(Loss) income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(86,510)(2,945)(96,134)9,137 (Loss) income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(43,911)45,904 (5,995)(9,624)
Income (loss) from unconsolidated entities2,772 865 7,289 (15,861)
Gain on real estate dispositions150,292 12,622 194,083 240,101 
Income tax (expense) benefit(3,780)3,195 (9,574)95,855 
Income from continuing operations62,774 13,737 95,664 329,232 
Net income62,774 13,737 95,664 329,232 
(Loss) income from unconsolidated entities(Loss) income from unconsolidated entities(1,047)4,767 (5,316)4,517 
(Loss) gain on real estate dispositions(Loss) gain on real estate dispositions(34)41,258 2,421 43,791 
Income tax benefit (expense)Income tax benefit (expense)3,790 (3,641)8,280 (5,794)
(Loss) income from continuing operations(Loss) income from continuing operations(41,202)88,288 (610)32,890 
Net (loss) incomeNet (loss) income(41,202)88,288 (610)32,890 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests2,094 986 5,802 534 Net income attributable to noncontrolling interests1,214 1,897 3,074 3,708 
Net income attributable to common stockholders$60,680 $12,751 $89,862 $328,698 
Net (loss) income attributable to common stockholdersNet (loss) income attributable to common stockholders$(42,416)$86,391 $(3,684)$29,182 
Earnings per common shareEarnings per common share  Earnings per common share  
Basic:Basic:  Basic:  
Income from continuing operations$0.16 $0.04 $0.25 $0.88 
(Loss) income from continuing operations(Loss) income from continuing operations$(0.10)$0.24 $— $0.09 
Net income attributable to common stockholders0.16 0.03 0.24 0.88 
Diluted:    
Income from continuing operations$0.16 $0.04 $0.25 $0.88 
Net (loss) income attributable to common stockholdersNet (loss) income attributable to common stockholders(0.11)0.23 (0.01)0.08 
Diluted:1
Diluted:1
    
(Loss) income from continuing operations(Loss) income from continuing operations$(0.10)$0.23 $— $0.09 
Net income attributable to common stockholders0.16 0.03 0.24 0.87 
Net (loss) income attributable to common stockholdersNet (loss) income attributable to common stockholders(0.11)0.23 (0.01)0.08 
1 Potential common shares are not included in the computation of diluted earnings per share when a loss from continuing operations exists as the effect would be an antidilutive per share amount.

See accompanying notes.
2


VENTAS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)(In thousands, unaudited)
 For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2021202020212020
(In thousands)
Net income$62,774 $13,737 $95,664 $329,232 
Other comprehensive (loss) income:  
Foreign currency translation(2,763)7,907 (3,795)(4,942)
Unrealized (loss) gain on available for sale securities(13,638)10,431 (20,918)(9,828)
Derivative instruments4,578 1,714 13,389 (19,661)
Total other comprehensive (loss) income(11,823)20,052 (11,324)(34,431)
Comprehensive income50,951 33,789 84,340 294,801 
Comprehensive (loss) income attributable to noncontrolling interests(418)3,320 7,724 (3,419)
Comprehensive income attributable to common stockholders$51,369 $30,469 $76,616 $298,220 

 For the Three Months Ended June 30,For the Six Months Ended June 30,
 2022202120222021
Net (loss) income$(41,202)$88,288 $(610)$32,890 
Other comprehensive income (loss):  
Foreign currency translation loss(11,429)(1,016)(20,742)(1,032)
Unrealized loss on available for sale securities(1,531)(2,663)(2,119)(7,280)
Unrealized gain (loss) on derivative instruments14,107 (595)33,143 8,811 
Total other comprehensive income (loss)1,147 (4,274)10,282 499 
Comprehensive (loss) income(40,055)84,014 9,672 33,389 
Comprehensive (loss) income attributable to noncontrolling interests(580)3,416 5,191 8,142 
Comprehensive (loss) income attributable to common stockholders$(39,475)$80,598 $4,481 $25,247 
   
See accompanying notes.
3


VENTAS, INC.
CONSOLIDATED STATEMENTS OF EQUITY
For the Three Months Ended SeptemberJune 30, 20212022 and 20202021
(Unaudited)(In thousands, except per share amounts, unaudited)
2019Common
Stock Par
Value
Capital in
Excess of
Par Value
Accumulated
Other
Comprehensive
Loss
Retained
Earnings
(Deficit)
Treasury
Stock
Total Ventas
Stockholders’
Equity
Noncontrolling
Interests
Total Equity
2019(In thousands, except per share amounts)
Balance at July 1, 2021$93,784 $14,187,577 $(58,290)$(4,340,052)$(320)$9,882,699 $101,205 $9,983,904 
Net income— — — 60,680 — 60,680 2,094 62,774 
Other comprehensive loss— — (9,311)— — (9,311)(2,512)(11,823)
Acquisition-related activity3,332 747,916 — — — 751,248 — 751,248 
Net change in noncontrolling interests— (41,248)— — — (41,248)(10,358)(51,606)
Dividends to common stockholders—$0.45 per share— — — (180,258)— (180,258)— (180,258)
Issuance of common stock for stock plans, restricted stock grants and other2,661 606,620 — — 204 609,485 — 609,485 
Adjust redeemable OP unitholder interests to current fair value— 3,386 — — — 3,386 — 3,386 
Redemption of OP Units— (41)— — 76 35 — 35 
Balance at September 30, 2021$99,777 $15,504,210 $(67,601)$(4,459,630)$(40)$11,076,716 $90,429 $11,167,145 
Balance at July 1, 2020$93,261 $14,118,119 $(82,761)$(3,816,460)$(947)$10,311,212 $88,698 $10,399,910 
Net income— — — 12,751 — 12,751 986 13,737 
Other comprehensive income— — 17,719 — — 17,719 2,333 20,052 
Net change in noncontrolling interests— (6,173)— — — (6,173)(1,162)(7,335)
Dividends to common stockholders—$0.45 per share— — — (166,738)— (166,738)— (166,738)
Issuance of common stock for stock plans, restricted stock grants and other206 42,074 — (2,200)(328)39,752 — 39,752 
Adjust redeemable OP unitholder
    interests to current fair value
— (11,669)— — — (11,669)— (11,669)
Redemption of OP Units— (2)— — — (2)— (2)
Balance at September 30, 2020$93,467 $14,142,349 $(65,042)$(3,972,647)$(1,275)$10,196,852 $90,855 $10,287,707 

2019Common
Stock Par
Value
Capital in
Excess of
Par Value
Accumulated
Other
Comprehensive
Loss
Retained
Earnings
(Deficit)
Treasury
Stock
Total Ventas
Stockholders’
Equity
Noncontrolling
Interests
Total Equity
Balance at April 1, 2022$99,888 $15,478,467 $(59,296)$(4,821,653)$— $10,697,406 $95,284 $10,792,690 
Net loss— — — (42,416)— (42,416)1,214 (41,202)
Other comprehensive income— — 2,941 — — 2,941 (1,794)1,147 
Net change in noncontrolling interests— (7,379)— — — (7,379)(3,906)(11,285)
Dividends to common stockholders—$0.45 per share— — — (180,500)— (180,500)— (180,500)
Issuance of common stock for stock plans, restricted stock grants and other25 9,882 — — (408)9,499 — 9,499 
Adjust redeemable OP unitholder interests to current fair value— 33,045 — — — 33,045 — 33,045 
Balance at June 30, 2022$99,913 $15,514,015 $(56,355)$(5,044,569)$(408)$10,512,596 $90,798 $10,603,394 
Balance at April 1, 2021$93,750 $14,186,692 $(52,497)$(4,257,001)$(789)$9,970,155 $101,465 $10,071,620 
Net income— — — 86,391 — 86,391 1,897 88,288 
Other comprehensive (loss) income— — (5,793)— — (5,793)1,519 (4,274)
Net change in noncontrolling interests— 2,804 — — — 2,804 (3,676)(872)
Dividends to common stockholders—$0.45 per share— — — (169,442)— (169,442)— (169,442)
Issuance of common stock for stock plans, restricted stock grants and other34 10,505 — — 469 11,008 — 11,008 
Adjust redeemable OP unitholder
    interests to current fair value
— (12,421)— — — (12,421)— (12,421)
Redemption of OP Units— (3)— — — (3)— (3)
Balance at June 30, 2021$93,784 $14,187,577 $(58,290)$(4,340,052)$(320)$9,882,699 $101,205 $9,983,904 

See accompanying notes.
4


VENTAS, INC.
CONSOLIDATED STATEMENTS OF EQUITY
For the NineSix Months Ended SeptemberJune 30, 20212022 and 20202021
(Unaudited)(In thousands, except per share amounts, unaudited)
2019Common
Stock Par
Value
Capital in
Excess of
Par Value
Accumulated
Other
Comprehensive
Loss
Retained
Earnings
(Deficit)
Treasury
Stock
Total Ventas
Stockholders’
Equity
Noncontrolling
Interests
Total Equity
2021(In thousands, except per share amounts)
Balance at January 1, 2021$93,635 $14,171,262 $(54,354)$(4,030,376)$— $10,180,167 $98,024 $10,278,191 
Net income— — — 89,862 — 89,862 5,802 95,664 
Other comprehensive (loss) income— — (13,247)— — (13,247)1,923 (11,324)
Acquisition-related activity3,332 747,916 — — — 751,248 — 751,248 
Net change in noncontrolling interests— (35,009)— — — (35,009)(15,320)(50,329)
Dividends to common stockholders—$1.3500 per share— — — (519,116)— (519,116)— (519,116)
Issuance of common stock for stock plans, restricted stock grants and other2,810 642,054 — — (116)644,748 — 644,748 
Adjust redeemable OP unitholder interests to current fair value— (21,953)— — — (21,953)— (21,953)
Redemption of OP Units— (60)— — 76 16 — 16 
Balance at September 30, 2021$99,777 $15,504,210 $(67,601)$(4,459,630)$(40)$11,076,716 $90,429 $11,167,145 
Balance at January 1, 2020$93,185 $14,056,453 $(34,564)$(3,669,050)$(132)$10,445,892 $99,560 $10,545,452 
Net income— — — 328,698 — 328,698 534 329,232 
Other comprehensive loss— — (30,478)— — (30,478)(3,953)(34,431)
Net change in noncontrolling interests— (5,160)— — — (5,160)(5,286)(10,446)
Dividends to common stockholders—$1.6925 per share— — — (631,346)— (631,346)— (631,346)
Issuance of common stock for stock plans, restricted stock grants and other282 54,967 — (949)(1,143)53,157 — 53,157 
Adjust redeemable OP unitholder interests to current fair value— 36,353 — — — 36,353 — 36,353 
Redemption of OP Units— (264)— — — (264)— (264)
Balance at September 30, 2020$93,467 $14,142,349 $(65,042)$(3,972,647)$(1,275)$10,196,852 $90,855 $10,287,707 

2019Common
Stock Par
Value
Capital in
Excess of
Par Value
Accumulated
Other
Comprehensive
Loss
Retained
Earnings
(Deficit)
Treasury
Stock
Total Ventas
Stockholders’
Equity
Noncontrolling
Interests
Total Equity
Balance at January 1, 2022$99,838 $15,498,956 $(64,520)$(4,679,889)$— $10,854,385 $91,375 $10,945,760 
Net loss— — — (3,684)— (3,684)3,074 (610)
Other comprehensive income— — 8,165 — — 8,165 2,117 10,282 
Net change in noncontrolling interests— (6,521)— — — (6,521)(5,768)(12,289)
Dividends to common stockholders—$0.90 per share— — — (360,996)— (360,996)— (360,996)
Issuance of common stock for stock plans, restricted stock grants and other75 25,172 — — (408)24,839 — 24,839 
Adjust redeemable OP unitholder interests to current fair value— (3,592)— — — (3,592)— (3,592)
Balance at June 30, 2022$99,913 $15,514,015 $(56,355)$(5,044,569)$(408)$10,512,596 $90,798 $10,603,394 
Balance at January 1, 2021$93,635 $14,171,262 $(54,354)$(4,030,376)$— $10,180,167 $98,024 $10,278,191 
Net income— — — 29,182 — 29,182 3,708 32,890 
Other comprehensive loss— — (3,936)— — (3,936)4,435 499 
Net change in noncontrolling interests— 6,239 — — — 6,239 (4,962)1,277 
Dividends to common stockholders—$0.90 per share— — — (338,858)— (338,858)— (338,858)
Issuance of common stock for stock plans, restricted stock grants and other149 35,434 — — (320)35,263 — 35,263 
Adjust redeemable OP unitholder interests to current fair value— (25,339)— — — (25,339)— (25,339)
Redemption of OP Units— (19)— — — (19)— (19)
Balance at June 30, 2021$93,784 $14,187,577 $(58,290)$(4,340,052)$(320)$9,882,699 $101,205 $9,983,904 

See accompanying notes.

5


VENTAS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)(In thousands, unaudited)
For the Nine Months Ended September 30,
20212020
For the Six Months Ended June 30,
(In thousands) 20222021
Cash flows from operating activities:Cash flows from operating activities: Cash flows from operating activities: 
Net income$95,664 $329,232 
Adjustments to reconcile net income to net cash provided by operating activities:
Net (loss) incomeNet (loss) income$(610)$32,890 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortizationDepreciation and amortization878,444 847,797 Depreciation and amortization572,139 564,848 
Amortization of deferred revenue and lease intangibles, netAmortization of deferred revenue and lease intangibles, net(71,620)(25,343)Amortization of deferred revenue and lease intangibles, net(33,491)(31,551)
Other non-cash amortizationOther non-cash amortization14,686 15,211 Other non-cash amortization6,412 10,119 
Allowance on loans receivable and investmentsAllowance on loans receivable and investments(9,021)34,654 Allowance on loans receivable and investments(116)(8,961)
Stock-based compensationStock-based compensation26,165 17,322 Stock-based compensation22,601 21,465 
Straight-lining of rental incomeStraight-lining of rental income(10,166)107,134 Straight-lining of rental income(7,559)(7,167)
Loss on extinguishment of debt, netLoss on extinguishment of debt, net56,808 7,386 Loss on extinguishment of debt, net27,016 
Gain on real estate dispositionsGain on real estate dispositions(194,083)(240,101)Gain on real estate dispositions(2,421)(43,791)
Gain on real estate loan investmentsGain on real estate loan investments(2,006)(167)Gain on real estate loan investments— (74)
Income tax expense (benefit)4,656 (99,702)
(Income) loss from unconsolidated entities(7,279)15,869 
Income tax (benefit) expenseIncome tax (benefit) expense(11,184)2,510 
Loss (income) from unconsolidated entitiesLoss (income) from unconsolidated entities5,322 (4,512)
Distributions from unconsolidated entitiesDistributions from unconsolidated entities9,466 2,960 Distributions from unconsolidated entities10,719 6,480 
OtherOther(830)15,615 Other25,128 (34,841)
Changes in operating assets and liabilities:Changes in operating assets and liabilities:Changes in operating assets and liabilities:
Increase in other assetsIncrease in other assets(49,051)(68,228)Increase in other assets(32,622)(25,618)
Decrease in accrued interestDecrease in accrued interest(22,414)(12,975)Decrease in accrued interest(2,008)(5,732)
Increase in accounts payable and other liabilitiesIncrease in accounts payable and other liabilities40,896 207,749 Increase in accounts payable and other liabilities315 25,775 
Net cash provided by operating activitiesNet cash provided by operating activities760,315 1,154,413 Net cash provided by operating activities552,632 528,856 
Cash flows from investing activities:Cash flows from investing activities:  Cash flows from investing activities:  
Net investment in real estate propertyNet investment in real estate property(1,103,210)(77,625)Net investment in real estate property(388,295)(210)
Investment in loans receivableInvestment in loans receivable(384)(113,147)Investment in loans receivable(5,225)(283)
Proceeds from real estate disposalsProceeds from real estate disposals497,303 682,604 Proceeds from real estate disposals6,171 115,850 
Proceeds from loans receivableProceeds from loans receivable302,700 106,966 Proceeds from loans receivable487 36,475 
Development project expendituresDevelopment project expenditures(204,649)(309,967)Development project expenditures(81,878)(130,894)
Capital expendituresCapital expenditures(119,311)(94,407)Capital expenditures(91,004)(74,122)
Distributions from unconsolidated entitiesDistributions from unconsolidated entities17,847 — Distributions from unconsolidated entities25,652 — 
Investment in unconsolidated entitiesInvestment in unconsolidated entities(107,140)(7,832)Investment in unconsolidated entities(33,086)(68,311)
Insurance proceeds for property damage claimsInsurance proceeds for property damage claims501 33 Insurance proceeds for property damage claims7,918 390 
Net cash (used in) provided by investing activities(716,343)186,625 
Net cash used in investing activitiesNet cash used in investing activities(559,260)(121,105)
Cash flows from financing activities:Cash flows from financing activities:  Cash flows from financing activities:  
Net change in borrowings under revolving credit facilitiesNet change in borrowings under revolving credit facilities(144,065)(74,144)Net change in borrowings under revolving credit facilities(7,822)(104,131)
Net change in borrowings under commercial paper programNet change in borrowings under commercial paper program369,943 (565,524)Net change in borrowings under commercial paper program55,184 169,984 
Proceeds from debtProceeds from debt914,879 657,557 Proceeds from debt706,915 268,286 
Repayment of debtRepayment of debt(1,499,036)(127,528)Repayment of debt(394,395)(565,951)
Purchase of noncontrolling interestsPurchase of noncontrolling interests(11,485)— Purchase of noncontrolling interests(170)— 
Payment of deferred financing costsPayment of deferred financing costs(23,608)(7,564)Payment of deferred financing costs(4,126)(17,776)
Issuance of common stock, netIssuance of common stock, net617,438 36,395 Issuance of common stock, net— 14,250 
Cash distribution to common stockholdersCash distribution to common stockholders(506,972)(760,363)Cash distribution to common stockholders(360,098)(337,838)
Cash distribution to redeemable OP unitholdersCash distribution to redeemable OP unitholders(5,400)(5,954)Cash distribution to redeemable OP unitholders(3,072)(3,164)
Cash issued for redemption of OP UnitsCash issued for redemption of OP Units(96)(575)Cash issued for redemption of OP Units— (62)
Contributions from noncontrolling interestsContributions from noncontrolling interests35 1,138 Contributions from noncontrolling interests39 30 
Distributions to noncontrolling interestsDistributions to noncontrolling interests(11,785)(9,666)Distributions to noncontrolling interests(7,873)(8,588)
Proceeds from stock option exercisesProceeds from stock option exercises5,668 3,518 Proceeds from stock option exercises8,691 4,821 
OtherOther(5,128)(4,989)Other(6,219)(5,934)
Net cash used in financing activitiesNet cash used in financing activities(299,612)(857,699)Net cash used in financing activities(12,946)(586,073)
Net (decrease) increase in cash, cash equivalents and restricted cash(255,640)483,339 
Net decrease in cash, cash equivalents and restricted cashNet decrease in cash, cash equivalents and restricted cash(19,574)(178,322)
Effect of foreign currency translationEffect of foreign currency translation522 (951)Effect of foreign currency translation(992)1,450 
Cash, cash equivalents and restricted cash at beginning of periodCash, cash equivalents and restricted cash at beginning of period451,640 146,102 Cash, cash equivalents and restricted cash at beginning of period196,597 451,640 
Cash, cash equivalents and restricted cash at end of periodCash, cash equivalents and restricted cash at end of period$196,522 $628,490 Cash, cash equivalents and restricted cash at end of period$176,031 $274,768 

See accompanying notes.
6


VENTAS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Unaudited)(In thousands, unaudited)
For the Nine Months Ended September 30,
20212020
For the Six Months Ended June 30,
(In thousands) 20222021
Supplemental schedule of non-cash activities:Supplemental schedule of non-cash activities:  Supplemental schedule of non-cash activities:  
Assets acquired and liabilities assumed from acquisitions and other:Assets acquired and liabilities assumed from acquisitions and other:  Assets acquired and liabilities assumed from acquisitions and other:  
Real estate investmentsReal estate investments$1,317,617 $169,484 Real estate investments$3,176 $468 
Other assetsOther assets16,132 1,224 Other assets362 — 
Debt484,073 55,368 
Other liabilitiesOther liabilities97,960 2,707 Other liabilities2,944 — 
Deferred income tax liabilityDeferred income tax liability— 337 Deferred income tax liability594 — 
Noncontrolling interestsNoncontrolling interests468 20,259 Noncontrolling interests— 468 
Equity issued751,248 — 
Equity issued for redemption of OP Units76 — 

See accompanying notes.
7

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)


NOTE 1—DESCRIPTION OF BUSINESS

Ventas, Inc. (together with its consolidated subsidiaries, unless otherwise indicated or except where the context otherwise requires, “we,” “us” or “our”)“us,” “our,” “Company” and other similar terms), an S&P 500 company, is a real estate investment trust (“REIT”) operating at the intersection of healthcare and real estate. We hold a highly diversified portfolio of senior housing communities, medical office buildings (“MOBs”), life science, research and innovation centers, hospitals and other healthcare propertiesfacilities, which we generally refer to as “healthcare real estate,” located throughout the United States, Canada and the United Kingdom. As of SeptemberJune 30, 2021,2022, we owned or had investments in approximately 1,300 properties (including properties classified as held for sale), consisting of senior housing communities, medical office buildings (“MOBs”), life science, research and innovation centers, inpatient rehabilitation facilities (“IRFs”) and long-term acute care facilities (“LTACs”) and health systems, which we generally refer to as “healthcare real estate.”. Our company was originally founded in 1983 and is headquartered in Chicago, Illinois with additional corporate offices in Louisville, Kentucky and New York, New York.

We primarily invest in a diversified portfolio of healthcare real estate assets through wholly owned subsidiaries and other co-investment entities. We operate through 3 reportable business segments: triple-net leased properties, senior living operations,housing operating portfolio, which we also refer to as SHOP,“SHOP” and is formerly known as senior living operations, and office operations. See “Note 2 – Accounting Policies” and “Note 16 – Segment Information.” Our senior housing propertiescommunities are either subject to triple-net leases, in which case they are included in our triple-net leased properties reportable business segment, or operated by independent third-party managers, in which case they are included in our senior living operationsSHOP reportable business segment.

As of SeptemberJune 30, 2021,2022, we leased a total of 354331 properties (excluding properties within our office operations reportable business segment) to various healthcare operating companies under triple-net or absolute-net leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures. Our 3 largest tenants, Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”), Ardent Health Partners, LLC (together with its subsidiaries, “Ardent”) and Kindred Healthcare, LLC (together with its subsidiaries, “Kindred”) leased from us 121 properties, 1230 properties and 3229 properties, respectively, as of SeptemberJune 30, 2021.2022.

As of SeptemberJune 30, 2021,2022, pursuant to long-term management agreements, we engaged independent managers,operators, such as Atria Senior Living, Inc. (together with its subsidiaries, including Holiday Retirement (“Atria”Holiday”), “Atria”) and Sunrise Senior Living, LLC (together with its subsidiaries, “Sunrise”), to manage 551557 senior housing communities in our senior living operations segment for us.

Through our Lillibridge Healthcare Services, Inc. subsidiary and our ownership interest in PMB Real Estate Services LLC, we also provide MOB management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make secured and non-mortgage loans and other investments relating to senior housing and healthcare operators or properties.

Continuing Impact of and Response to COVID-19 and Its Extended Consequences

During fiscal 2020 and 2021 and continuing into fiscal 2021,2022, our business has been and continuesis expected to continue to be impacted by both the COVID-19 pandemic itself, including actions taken to prevent the spread of the virus and its variants, and the ongoingits extended consequences and effects of the pandemic on our business, including our senior housing business, and the broader economy.

Accounting Considerations.We have not identified the COVID-19, pandemic, on its own, as a “triggering event” for purposes of evaluating impairment of real estate assets, goodwill and other intangibles, investments in unconsolidated entities and financial instruments. However, as of SeptemberJune 30, 2021,2022, we considered the effect of the pandemicCOVID-19 on certain of our assets and our ability to recover the respective carrying values of these assets. We applied our considerations to existing critical accounting policies that require us to make estimates and assumptions regarding future events that affect the reported amounts of assets and liabilities. We based our estimates on our experience and on assumptions we believe to be reasonable under the circumstances. For both the ninesix months ended SeptemberJune 30, 2022 and 2021, we recognized no COVID-19 related charges in our Consolidated Statements of Income.

Provider Relief Grants. We applied for grants under the Provider Relief Fund administered by the U.S. Department of Health & Human Services (“HHS”) on behalf of the assisted living communities in our SHOP reportable business segment to partially mitigate losses attributable to COVID-19. These grants are intended to reimburse eligible providers for expenses incurred to prevent, prepare for and respond to COVID-19 and lost revenues attributable to COVID-19. Recipients are not required to repay distributions from the Provider Relief Fund, provided that they attest to and comply with certain terms and conditions.

8

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

During the six months ended June 30, 2022 and 2021, we received $34.0 million and $13.6 million, respectively, in grants in connection with our applications and recognized these grants within property-level operating expenses in our Consolidated Statements of Income in the period in which they were received. In July 2022, we received $20.2 million in HHS grants.

Continuing Impact. The trajectory and future impact of the COVID-19 pandemic and its ongoingextended consequences for the U.S. economy and our business remain highly uncertain. The extent of the pandemic’s continuing effect on our operationaluncertain and financial performance will depend on a variety of factors, including the ultimate duration of the pandemic; the speed at which vaccines and other clinical treatments are successfully developed and deployed; the rate of acceptance of available vaccines, particularly among the residents and staff in our senior housing communities and the labor force more broadly; the impact of new variants of the virus and the effectiveness of available vaccines and other clinical treatments against those variants; ongoing clinical experience, which may differ considerably across governmental and regulatory bodies and regions and fluctuate over time; and other future developments, including the ultimate duration, spread and intensity of the outbreak, the availability of testing, the extent to which governments impose, roll-back or re-impose preventative restrictions and the availability of ongoing government financial support to our business, tenants and operators;operators. Due to these uncertainties, we are not able at this time to estimate the ultimate impact of COVID-19 on our business, results of operations, financial condition and the slope and pace of recovery of our senior housing business and the U.S. economy more generally. The pandemic and actions taken in response to the pandemic have had broad economic consequences, including for the labor market and global supply chain, which have affected and may continue to affect our business.
8

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)


cash flows.

NOTE 2—ACCOUNTING POLICIES

The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”), and with the Securities and Exchange Commission (“SEC”) instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. Operating results for the three and ninesix months ended SeptemberJune 30, 20212022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.2022. The accompanying Consolidated Financial Statements and related notes should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 20202021 (the “2020“2021 Annual Report”). Certain prior period amounts have been reclassified to conform to the current period presentation.

Principles of Consolidation

The accompanying Consolidated Financial Statements include our accounts and the accounts of our wholly owned subsidiaries and the joint venture entities over which we exercise control. All intercompany transactions and balances have been eliminated in consolidation, and our net earnings are reduced by the portion of net earnings attributable to noncontrolling interests.

GAAP requires us to identify entities for which control is achieved through means other than voting rights and to determine which business enterprise is the primary beneficiary of variable interest entities (“VIEs”). A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; and (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. We consolidate our investment in a VIE when we determine that we are its primary beneficiary. We may change our original assessment of a VIE upon subsequent events such as the modification of contractual arrangements that affects the characteristics or adequacy of the entity’s equity investments at risk and the disposition of all or a portion of an interest held by the primary beneficiary.

We identify the primary beneficiary of a VIE as the enterprise that has both: (i) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance; and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could be significant to the entity. We perform this analysis on an ongoing basis.

As it relates to investments in joint ventures, GAAP may preclude consolidation by the sole general partner in certain circumstances based on the type of rights held by the limited partner or partners. We assess limited partners’ rights and their impact on our consolidation conclusions, and we reassess if there is a change to the terms or in the exercisability of the rights of the limited partners, the sole general partner increases or decreases its ownership of limited partnership (“LP”) interests or there is an increase or decrease in the number of outstanding LP interests. We also apply this guidance to managing member interests in limited liability companies (“LLCs”).
9

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)


We consolidate several VIEs that share the following common characteristics:

the VIE is in the legal form of an LP or LLC;
the VIE was designed to own and manage its underlying real estate investments;
we are the general partner or managing member of the VIE;
we own a majority of the voting interests in the VIE;
a minority of voting interests in the VIE are owned by external third parties, unrelated to us;
the minority owners do not have substantive kick-out or participating rights in the VIE; and
we are the primary beneficiary of the VIE.

We have separately identified certain special purpose entities that were established to allow investments in life science, research and innovation projects by tax credit investors (“TCIs”). We have determined that these special purpose entities are VIEs, we are a holder of variable interests and we are the primary beneficiary of the VIEs, and therefore, we consolidate these
9

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

special purpose entities. Our primary beneficiary determination is based upon several factors, including but not limited to the rights we have in directing the activities which most significantly impact the VIEs’ economic performance as well as certain guarantees which protect the TCIs from losses should a tax credit recapture event occur.

In general, the assets of consolidated VIEs are available only for the settlement of the obligations of the respective entities. Unless otherwise required by the LP or LLC agreement, any mortgage loans of the consolidated VIEs are non-recourse to us. The table below summarizes the total assets and liabilities of our consolidated VIEs as reported on our Consolidated Balance Sheets.Sheets (dollars in thousands):
September 30, 2021December 31, 2020
Total AssetsTotal LiabilitiesTotal AssetsTotal LiabilitiesAs of June 30, 2022As of December 31, 2021
(In thousands)Total AssetsTotal LiabilitiesTotal AssetsTotal Liabilities
NHP/PMB L.P.NHP/PMB L.P.$750,455 $253,675 $649,128 $238,168 NHP/PMB L.P.$756,063 $260,217 $749,834 $251,352 
Other identified VIEsOther identified VIEs4,016,054 1,673,060 4,095,102 1,653,036 Other identified VIEs3,892,070 1,532,677 3,949,294 1,556,136 
Tax credit VIEsTax credit VIEs461,065 105,525 614,490 204,746 Tax credit VIEs443,332 82,126 458,953 103,992 

Investments in Unconsolidated Entities

We report investments in unconsolidated entities over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. We adjust our investment in unconsolidated entities for additional contributions made, distributions received as well as our share of the investee’s earnings or losses, which is included in loss from unconsolidated entities in our Consolidated Statements of Income.

We base the initial carrying value of investments in unconsolidated entities on the fair value of the assets at the time we acquired the joint venture interest. We estimate fair values for our equity method investments based on discounted cash flow models that include all estimated cash inflows and outflows over a specified holding period and, where applicable, any estimated debt premiums or discounts. The capitalization rates, discount rates and credit spreads we use in these models are based upon assumptions that we believe to be within a reasonable range of current market rates for the respective investments.

We generally amortize any difference between our cost basis and the basis reflected at the joint venture level, if any, over the lives of the related assets and liabilities and include that amortization in our share of income or loss from unconsolidated entities. For earnings of equity method investments with pro rata distribution allocations, net income or loss is allocated between the partners in the joint venture based on their respective stated ownership percentages. In other instances, net income or loss may be allocated between the partners in the joint venture based on the hypothetical liquidation at book value method (the “HLBV method”). Under the HLBV method, net income or loss is allocated between the partners based on the difference between each partner’s claim on the net assets of the joint venture at the end and beginning of the period, after taking into account contributions and distributions. Each partner’s share of the net assets of the joint venture is calculated as the amount that the partner would receive if the joint venture were to liquidate all of its assets at net book value and distribute the resulting cash to creditors and partners in accordance with their respective priorities. Under the HLBV method, in any given period, we could record more or less income than the joint venture has generated, than actual cash distributions we receive or than the amount we may receive in the event of an actual liquidation.

10

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Redeemable OP Unitholder and Noncontrolling Interests

We own a majority interest in NHP/PMB L.P. (“NHP/PMB”), a limited partnership formed in 2008 to acquire properties from entities affiliated with Pacific Medical Buildings LLC (“PMB”). Given our wholly owned subsidiary is the general partner and the primary beneficiary of NHP/PMB, we consolidate NHP/PMB as a VIE. As of SeptemberJune 30, 2021,2022, third party investors owned 3.9 million Class A limited partnership units in NHP/PMB (“OP Units”), which represented 34% of the total units then outstanding, and we owned 7.5 million Class B limited partnership units in NHP/PMB, representing the remaining 66%. The OP Units may be redeemed at any time at the election of the holder for cash or, at our option, 0.9051 shares of our common stock per OP Unit, subject to adjustment in certain circumstances. We are party by assumption to a registration rights agreement with the holders of the OP Units that requires us, subject to the terms and conditions and certain exceptions set forth therein, to file and maintain a registration statement relating to the issuance of shares of our common stock upon redemption of OP Units.

In September, NHP/PMB completed the buy-out of PMB’s interest in the newly developed Sutter Van Ness Medical Office Building. In connection with that transaction, NHP/PMB issued 0.6 million OP Units to third party investors.
10

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)


The OP Units are classified outside of permanent equity on our Consolidated Balance Sheets because they may be redeemed by third parties under circumstances that are outside of our control. We reflect the OP Units at the greater of cost or redemption value. As of SeptemberJune 30, 20212022 and December 31, 2020,2021, the fair value of the OP Units was $194.4$182.5 million and $146.0$182.1 million, respectively. We recognize changes in fair value through capital in excess of par value, net of cash distributions paid and purchases by us of any OP Units. Our diluted earnings per share includes the effect of any potential shares outstanding from redemption of the OP Units.

Certain noncontrolling interests of other consolidated joint ventures were also classified as redeemable at SeptemberJune 30, 20212022 and December 31, 2020.2021. We record the carrying amount of these noncontrolling interests at the greater of their initial carrying amount (increased or decreased for the noncontrolling interests’ share of net income or loss and distributions) or the redemption value, which is primarily based on the fair value of the underlying real estate asset. Our joint venture partners have certain redemption rights with respect to their noncontrolling interests in these joint ventures that are outside of our control, and the redeemable noncontrolling interests are classified outside of permanent equity on our Consolidated Balance Sheets. We recognize changes in the carrying value of redeemable noncontrolling interests through capital in excess of par value.value on our Consolidated Balance Sheets.

Noncontrolling Interests

Excluding the redeemable noncontrolling interests described above, we present the portion of any equity that we do not own in entities that we control (and thus consolidate) as noncontrolling interests and classify those interests as a component of consolidated equity, separate from total Ventas stockholders’ equity, on our Consolidated Balance Sheets. For consolidated joint ventures with pro rata distribution allocations, net income or loss, and comprehensive income, is allocated between the joint venture partners based on their respective stated ownership percentages. In other cases, net income or loss is allocated between the joint venture partners based on the HLBV method. We account for purchases or sales of equity interests that do not result in a change of control as equity transactions, through capital in excess of par value. We include net income attributable to the noncontrolling interests in net income in our Consolidated Statements of Income and we include the noncontrolling interestsinterests’ share of comprehensive income in our Consolidated Statements of Comprehensive Income.

Accounting for Historic and New Markets Tax Credits

For certain of our life science, research and innovation centers, we are party to contractual arrangements with TCIs that were established to enable the TCIs to receive benefits of historic tax credits (“HTCs”), new markets tax credits (“NMTCs”) or both. As of SeptemberJune 30, 2021,2022, we owned 6 properties that had syndicated HTCs or NMTCs, or both, to TCIs.

In general, TCIs invest cash into special purpose entities that invest in entities that own the subject property and generate the tax credits. The TCIs receive substantially all of the tax credits and hold only a nominal interest in the economic risk and benefits of the special purpose entities.

HTCs are delivered to the TCIs upon substantial completion of the project. NMTCs are allowed for up to 39% of a qualified investment and are delivered to the TCIs after the investment has been funded and spent on a qualified business. HTCs are subject to 20% recapture per year beginning onewithin five years of substantial completion. The amount of the recapture is equal to 100% of the HTCs during the first year after the completion of the historic rehabilitation ofand is reduced by 20% each year during the subject property.subsequent five year period. NMTCs are subject to 100% recapture until the end of the seventh year following the qualifying investment. We have provided the TCIs with certain guarantees which protect the TCIs from losses should a tax credit recapture
11

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

event occur. The contractual arrangements with the TCIs include a put/call provision whereby we may be obligated or entitled to repurchase the interest of the TCIs in the special purpose entities at the end of the tax credit recapture period. We anticipate that either the TCIs will exercise their put rights or we will exercise our call rights prior to the applicable tax credit recapture periods.

The portion of the TCI’s investment that is attributed to the put is recorded at fair value at inception in accounts payable and other liabilities on our Consolidated Balance Sheets, and is accreted to the expected put price as interest expense in our Consolidated Statements of Income over the recapture period. The remaining balance of the TCI’s investment is initially recorded in accounts payable and other liabilities on our Consolidated Balance Sheets and will be relieved upon delivery of the tax credit to the TCI, as a reduction in the carrying value of the subject property, net of allocated expenses. Direct and incremental costs incurred in structuring the transaction are deferred and will be recognized as an increase in the cost basis of the subject property upon the recognition of the related tax credit as discussed above.

11

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

Accounting for Real Estate Acquisitions

When we acquire real estate, we first make reasonable judgments about whether the transaction involves an asset or a business. Our real estate acquisitions are generally accounted for as asset acquisitions as substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. Regardless of whether an acquisition is considered a business combination or an asset acquisition, we record the cost of the businesses or assets acquired as tangible and intangible assets and liabilities based upon their estimated fair values as of the acquisition date.

We estimate the fair value of buildings acquired on an as-if-vacant basis or replacement cost basis and depreciate the building value over the estimated remaining life of the building, generally not to exceed 35 years. We determine the fair value of other fixed assets, such as site improvements and furniture, fixtures and equipment, based upon the replacement cost and depreciate such value over the assets’ estimated remaining useful lives as determined at the applicable acquisition date. We determine the value of land either by considering the sales prices of similar properties in recent transactions or based on internal analyses of recently acquired and existing comparable properties within our portfolio. We generally determine the value of construction in progress based upon the replacement cost. However, for certain acquired properties that are part of a ground-up development, we determine fair value by using the same valuation approach as for all other properties and deducting the estimated cost to complete the development. During the remaining construction period, we capitalize project costs until the development has reached substantial completion. Construction in progress, including capitalized interest, is not depreciated until the development has reached substantial completion.

Intangibles primarily include the value of in-place leases and acquired lease contracts. We include all lease-related intangible assets and liabilities within acquired lease intangibles and accounts payable and other liabilities, respectively, on our Consolidated Balance Sheets.

The fair value of acquired lease-related intangibles, if any, reflects: (i) the estimated value of any above or below market leases, determined by discounting the difference between the estimated market rent and in-place lease rent; and (ii) the estimated value of in-place leases related to the cost to obtain tenants, including leasing commissions, and an estimated value of the absorption period to reflect the value of the rent and recovery costs foregone during a reasonable lease-up period as if the acquired space was vacant. We amortize any acquired lease-related intangibles to revenue or amortization expense over the remaining life of the associated lease plus any assumed bargain renewal periods. If a lease is terminated prior to its stated expiration or not renewed upon expiration, we recognize all unamortized amounts of lease-related intangibles associated with that lease in operations over the shortened lease term.

We estimate the fair value of purchase option intangible assets and liabilities, if any, by discounting the difference between the applicable property’s acquisition date fair value and an estimate of its future option price. We do not amortize the resulting intangible asset or liability over the term of the lease, but rather adjust the recognized value of the asset or liability upon sale.

In connection with an acquisition, we may assume rights and obligations under certain lease agreements pursuant to which we become the lessee of a given property. We generally assume the lease classification previously determined by the prior lessee absent a modification in the assumed lease agreement. We assess assumed operating leases, including ground leases, to determine whether the lease terms are favorable or unfavorable to us given current market conditions on the acquisition date. To the extent the lease terms are favorable or unfavorable to us relative to market conditions on the acquisition date, we recognize an intangible asset or liability at fair value and amortize that asset or liability to interest or rental expense in
12

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

our Consolidated Statements of Income over the applicable lease term. Where we are the lessee, we record the acquisition date values of leases, including any above or below market value, within operating lease assets and operating lease liabilities on our Consolidated Balance Sheets.

We estimate the fair value of noncontrolling interests assumed consistent with the manner in which we value all of the underlying assets and liabilities.

We calculate the fair value of long-term assumed debt by discounting the remaining contractual cash flows on each instrument at the current market rate for those borrowings, which we approximate based on the rate at which we would expect to incur a replacement instrument on the date of acquisition, and recognize any fair value adjustments related to long-term debt as effective yield adjustments over the remaining term of the instrument.

12

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

Fair Values of Financial Instruments

Fair value is a market-based measurement, not an entity-specific measurement, and we determine fair value based on the assumptions that we expect market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, GAAP establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels one and two of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within level three of the hierarchy).

Level one inputs utilize unadjusted quoted prices for identical assets or liabilities in active markets that we have the ability to access. Level two inputs are inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets and other inputs for the asset or liability that are observable at commonly quoted intervals, such as interest rates, foreign exchange rates and yield curves. Level three inputs are unobservable inputs for the asset or liability, which typically are based on our own assumptions, because there is little, if any, related market activity. If the determination of the fair value measurement is based on inputs from different levels of the hierarchy, the level within which the entire fair value measurement falls is the lowest level input that is significant to the fair value measurement in its entirety. If the volume and level of market activity for an asset or liability has decreased significantly relative to the normal market activity for such asset or liability (or similar assets or liabilities), then transactions or quoted prices may not accurately reflect fair value. In addition, if there is evidence that a transaction for an asset or liability is not orderly, little, if any, weight is placed on that transaction price as an indicator of fair value. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

We use the following methods and assumptions in estimating the fair value of our financial instruments whose fair value is determined on a recurring basis.

Cash and cash equivalents - The carrying amount of unrestricted cash and cash equivalents reported on our Consolidated Balance Sheets approximates fair value due to the short maturity of these instruments.

Escrow deposits and restricted cash - The carrying amount of escrow deposits and restricted cash reported on our Consolidated Balance Sheets approximates fair value due to the short maturity of these instruments.

Loans receivable - We estimate the fair value of loans receivable using level two and level three inputs, including underlying asset performance and credit quality. We discount future cash flows using current interest rates at which similar loans with the same terms and length to maturity would be made to borrowers with similar credit ratings.

Available for sale securities - We estimate the fair value of marketable debt securities using level two inputs. We observe quoted prices for similar assets or liabilities in active markets that we have the ability to access. We estimate the fair value of certain government-sponsored pooled loan investments using level three inputs. We consider credit spreads, underlying asset performance and credit quality, and default rates.

Derivative instruments - With the assistance of a third party, we estimate the fair value of derivative instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, using level two inputs.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Interest rate caps - We observe forward yield curves and other relevant information.

Interest rate swaps - We observe alternative financing rates derived from market-based financing rates, forward yield curves and discount rates.

Foreign currency forward contracts - We estimate the future values of the two currency tranches using forward exchange rates that are based on traded forward points and calculate a present value of the net amount using a discount factor based on observable traded interest rates.

Stock warrants - We estimate the fair value of stock warrants using level two inputs that are obtained from public sources. Inputs include equity spot price, dividend yield, volatility and risk-free rate.

Senior notes payable and other debt - We estimate the fair value of senior notes payable and other debt using level two inputs. We discount the future cash flows using current interest rates at which we could obtain similar
13

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

borrowings. For mortgage debt, we may estimate fair value using level three inputs, similar to those used in determining fair value of loans receivable (above).

Redeemable OP unitholder interests - We estimate the fair value of our redeemable OP unitholder interests using level one inputs. We base fair value on the closing price of our common stock, as OP Units may be redeemed at the election of the holder for cash or, at our option, shares of our common stock, subject to adjustment in certain circumstances.

Impairment of Long-Lived and Intangible Assets

We periodically evaluate our long-lived assets, primarily consisting of investments in real estate, for impairment indicators. If indicators of impairment are present, we evaluate the carrying value of the related real estate investments in relation to the future undiscounted cash flows of the underlying operations. In performing this evaluation, we consider market conditions and our current intentions with respect to holding or disposing of the asset. We adjust the net book value of leased properties and other long-lived assets to fair value if the sum of the expected future undiscounted cash flows, including sales proceeds, is less than book value. We recognize an impairment loss at the time we make any such determination.

If impairment indicators arise with respect to intangible assets with finite useful lives, we evaluate impairment by comparing the carrying amount of the asset to the estimated future undiscounted net cash flows expected to be generated by the asset. If estimated future undiscounted net cash flows are less than the carrying amount of the asset, then we estimate the fair value of the asset and compare the estimated fair value to the intangible asset’s carrying value. We recognize any shortfall from carrying value as an impairment loss in the current period.

We evaluate our investments in unconsolidated entities for impairment at least annually, and whenever events or changes in circumstances indicate that the carrying value of our investment may exceed its fair value. If we determine that a decline in the fair value of our investment in an unconsolidated entity is other-than-temporary, and if such reduced fair value is below the carrying value, we record an impairment.

We test goodwill for impairment at least annually, and more frequently if indicators of impairment arise. We first assess qualitative factors, such as current macroeconomic conditions, state of the equity and capital markets and our overall financial and operating performance, to determine the likelihood that the fair value of a reporting unit is less than its carrying amount. If we determine it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we proceed with estimating the fair value of the reporting unit. A goodwill impairment, if any, will be recognized in the period it is determined and is measured as the amount by which a reporting unit’s carrying value exceeds its fair value.

Estimates of fair value used in our evaluation of goodwill (if necessary, based on our qualitative assessment), investments in real estate, investments in unconsolidated entities and intangible assets are based upon discounted future cash flow projections or other acceptable valuation techniques that are based, in turn, upon all available evidence including level three inputs, such as revenue and expense growth rates, estimates of future cash flows, capitalization rates, discount rates, general economic conditions and trends, or other available market data such as replacement cost or comparable sales. Our ability to accurately predict future operating results and cash flows and to estimate and determine fair values impacts the timing and recognition of impairments. While we believe our assumptions are reasonable, changes in these assumptions may have a material impact on our financial results.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)


Revenue Recognition

Triple-Net Leased Properties and Office Operations

Certain of our triple-net leases and most of our MOB and life science, research and innovation centerscenters’ (collectively, “office operations”) leases provide for periodic and determinable increases in base rent. We recognize base rental revenues under these leases on a straight-line basis over the applicable lease term when collectability of substantially all rents is probable. Recognizing rental income on a straight-line basis generally results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in other assets on our Consolidated Balance Sheets. At SeptemberJune 30, 20212022 and December 31, 2020,2021, this cumulative excess totaled $173.6$181.7 million and $169.7$176.9 million, respectively (excluding properties classified as held for sale).

Certain of our leases provide for periodic increases in base rent only if certain revenue parameters or other substantive contingencies are met. We recognize the increased rental revenue under these leases as the related parameters or contingencies are met, rather than on a straight-line basis over the applicable lease term.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)


We assess the probability of collecting substantially all rents under our leases based on several factors, including, among other things, payment history, the financial strength of the tenant and any guarantors, the historical operations and operating trends of the property, the historical payment pattern of the tenant, the type of property, the value of the underlying collateral, if any, expected future performance of the property and current economic conditions. If our evaluation of these factors indicates it is not probable that we will be able to collect substantially all rents under the lease, we record a charge to rental income. If we change our conclusions regarding the probability of collecting rent payments required by a lease, we may recognize adjustments to rental income in the period we make such change in our conclusions.

Senior Living OperationsHousing Operating Portfolio

Our resident agreements are accounted for as leases and we recognize resident fees and services, other than move-in fees, monthly as services are provided. We recognize move-in fees on a straight-line basis over the average resident stay.

Other

We recognize interest income from loans and investments, including discounts and premiums, using the effective interest method when collectability is reasonably assured. We apply the effective interest method on a loan-by-loan basis and recognize discounts and premiums as yield adjustments over the related loan term. We evaluate collectability of accrued interest receivables separate from the amortized cost basis of our loans. As such, we recognize interest income on an impaired loan to the extent we believe accrued contractual interest payments are collectable. Otherwise interest income is recognized on a cash basis.

We evaluate a current estimate of all expected credit losses over the life of a financial instrument, which may result in recognition of credit losses on loans and other financial instruments before an actual event of default. We will establish reserves for any estimated credit losses with a corresponding charge to allowance on loans receivable and investments in our Consolidated Statements of Income. Subsequent changes in our estimate of credit losses may result in a corresponding increase or decrease to allowance on loans receivable and investments in our Consolidated Statements of Income.

Accounting for Leased Property

We lease real property, primarily land and corporate office space, and equipment, primarily vehicles at our senior housing communities. At lease inception, we establish an operating lease asset and operating lease liability calculated as the present value of future minimum lease payments.payments on our Consolidated Balance Sheets. As our leases do not provide an implicit rate, we use a discount rate that approximates our incremental borrowing rate available at lease commencement to determine the present value. Our lease expense primarily consists of ground and corporate office leases. Ground lease expense is included in interest expense and corporate office lease expense is included in general, administrative and professional fees in our Consolidated Statements of Income.

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VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Recently Adopted Accounting Standards

In November 2021, the FASB issued Accounting Standards Update 2021-10, Disclosures by Business Entities about Government Assistance (“ASU 2022-10”), which requires expanded annual disclosures for transactions involving the receipt of government assistance. Required disclosures include a description of the nature of the transactions with government entities, our accounting policies for such transactions and their impact to our Consolidated Financial Statements. We adopted ASU 2021-10 on January 1, 2022 and the adoption of this standard is not expected to have a material impact on our Consolidated Financial Statements.

NOTE 3—CONCENTRATION OF CREDIT RISK

As of SeptemberJune 30, 2021,2022, Atria, Sunrise, Brookdale Senior Living, Ardent and Kindred managed or operated approximately 19.9%26.7%, 10.0%9.8%, 7.9%7.7%, 4.7%5.3% and 1.0%0.8%, respectively, of our consolidated real estate investments based on gross book value (excluding properties classified as held for sale as of SeptemberJune 30, 2021)2022). Because Atria and Sunrise manage our properties in exchange for a management fee from us, we are not directly exposed to their credit risk in the same manner or to the same extent as triple-net tenants like Brookdale Senior Living, Ardent and Kindred.

Based on gross book value, approximately 14.3%12.7% and 52.4%53.9% of our consolidated real estate investments were senior housing communities included in the triple-net leased properties and senior living operationsSHOP reportable business segments, respectively (excluding properties classified as held for sale as of SeptemberJune 30, 2021)2022). MOBs, life science, research and innovation centers, IRFsinpatient rehabilitation facilities (“IRFs”) and LTACs,long-term acute care facilities (“LTACs”), health systems, skilled nursing facilities (“SNFs”) and secured loans receivable and investments collectively comprised the remaining 33.3%33.4%. Our consolidated properties were located in 47 states, the District of Columbia, 7 Canadian provinces and the United Kingdom as of SeptemberJune 30, 2021,2022, with properties in 1 state (California) accounting for more than 10% of our total consolidated revenues and net operating income (“NOI”) for the three months then ended. NOI” which is defined as total revenues, excludingless interest and other income, less property-level operating expenses and office building and other services costs)costs. See “Non-GAAP Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for the three months then ended.additional disclosure and a reconciliation of net income attributable to common stockholders, as computed in accordance with GAAP, to NOI.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

Triple-Net Leased Properties

The properties we lease to Brookdale Senior Living, Ardent and Kindred accountaccounted for a significant portion of our triple-net leased properties segment revenues and NOI and theNOI. The following table reflects the concentration risk related to our triple-net leased properties including assets held for sale for the periods presented:
 For the Three Months Ended September 30,
 20212020
Revenues (1):
  
Brookdale Senior Living3.8 %4.0 %
Ardent3.3 3.3 
Kindred3.5 3.6 
NOI:
Brookdale Senior Living8.2 %8.8 %
Ardent7.1 7.2 
Kindred7.5 7.8 

 For the Three Months Ended June 30,
 20222021
Revenues (1):
  
Brookdale Senior Living3.6 %4.1 %
Ardent3.2 3.4 
Kindred3.3 3.6 
NOI (2):
Brookdale Senior Living8.4 %8.8 %
Ardent7.3 7.4 
Kindred7.6 7.8 
(1)Total revenues include office building and other services revenue, income from loans and investments and interest and other income.
(2)See “Non-GAAP Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure and a reconciliation of net income attributable to common stockholders, as computed in accordance with GAAP, to NOI.

Each of our leases with Brookdale Senior Living, Ardent and Kindred is a triple-net lease that obligates the tenant to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures, and to comply with the terms of the mortgage financing documents, if any, affecting the properties. In addition, each of our Brookdale Senior Living, Ardent and Kindred leases has a corporate guaranty.

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VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

In December 2021, Kindred Healthcare, LLC was acquired and began operating under a new healthcare system called ScionHealth. As of March 31, 2022, we leased 29 LTACs to Kindred pursuant to a master lease agreement. Pursuant to the master lease, the 29 LTACs are divided into two renewal groups. The first renewal group is composed of 6 LTACs (“Group 1”) and the second renewal group is composed of 23 LTACs (“Group 2”). In the second quarter of 2022, we and Kindred amended the master lease to, among other things, extend the lease term of Group 1 through April 30, 2028. The lease term for Group 2 ends on April 30, 2025. Although Kindred has the right to renew each of Group 1 and Group 2 for additional lease terms, we cannot assure you that Kindred will exercise any renewal options for either pool, or if the lease term is renewed, amended or extended, the terms thereof.

Senior Living OperationsHousing Operating Portfolio

As of SeptemberJune 30, 2021,2022, Atria and Sunrise, collectively, provided comprehensive property management and accounting services with respect to 279347 of our 542548 consolidated senior housing communities, for which we pay annual management fees pursuant to long-term management agreements.

On July 30, 2021, Atria acquired the management services division of Holiday, which at the time managed a pool of 26 communities for Ventas. As of June 30, 2022, Atria and its subsidiaries, including Holiday, managed a pool of 255 senior housing communities for Ventas. Ventas has the ongoing right to terminate the management contract for 91 of the communities with short term notice.

As of June 30, 2022, Sunrise managed a pool of 96 senior housing communities for Ventas. Subsequent to March 31, 2022, Ventas and Sunrise Senior Living entered into a revised management agreement for 92 communities with a term expiring May 31, 2035. Under the new management agreement, Sunrise will receive a management fee based on a percentage of revenue and net operating income generated by the applicable communities. Sunrise is also entitled to certain incentive fees if specified performance targets are met. Ventas has the right to freely terminate the management agreement as to all communities if certain performance metrics are not met and may freely terminate the management agreement as to certain specified communities at any time. In addition, Ventas may also terminate the management agreement as it relates to three communities per year subject to the payment of a fee and an aggregate cap on such terminations over the term of the agreement.

We successfully transitioned the operations of 90 senior living communities owned by us and operated under management agreements with Eclipse Senior Living, Inc. (“ESL”) to seven experienced managers on or before January 2, 2022. ESL ceased operation of its management business in early 2022 following completion of the transitions. We incurred certain one-time transition costs and expenses in connection with the transitions, which were recognized within transaction expenses and deal costs in our Consolidated Statements of Income.

We rely on our managers’ personnel, expertise, technical resources and information systems, proprietary information, good faith and judgment to manage our senior living operationshousing operating portfolio efficiently and effectively. We also rely on our managers to set appropriate resident fees, provide accurate property-level financial results in a timely manner and otherwise operate our senior housing communities in compliance with the terms of our management agreements and all applicable laws and regulations.

Eclipse Senior Living and Pending Operator Transitions

We are in the process of transitioning the operation of 90 senior living communities owned by us and currently operated under management agreements with Eclipse Senior Living, Inc. (“ESL”) to various experienced operators. All of the planned transitions are expected to be completed by the end of 2021. ESL is expected to cease operation of its management business in 2022 following completion of the transitions. We expect to incur certain one-time transition costs and expenses in connection with the transitions. We cannot assure you that these transitions will be completed on the terms or timeline anticipated or at all.

Sale of Kindred and Related Transactions

In June 2021, Kindred and LifePoint Health (“LifePoint”) announced that they entered into a definitive agreement pursuant to which LifePoint would acquire Kindred (the “LifePoint-Kindred Acquisition”). Kindred and LifePoint subsequently announced that, following the closing of the LifePoint-Kindred Acquisition, they plan to organize into two separate healthcare companies, with LifePoint and Kindred’s assets being allocated between the two companies. Kindred and LifePoint have said that they expect to complete these transactions by the end of 2021, subject to the completion of regulatory approvals and satisfaction of customary closing conditions. Under our agreements with Kindred, we currently expect to receive a fee in connection with these transactions. We cannot otherwise predict what effect they may have on Kindred, our properties or our lease with Kindred.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

NOTE 4—ACQUISITIONS OF REAL ESTATE PROPERTY

We acquire and invest in senior housing, medical office buildings, life science, research and innovation centers and other healthcare properties primarily to achieve an expected yield on our investment, to grow and diversify our portfolio and revenue base, and to reduce our dependence on any single tenant, operator or manager, geographic location, asset type, business model or revenue source. Each of our acquisitions disclosed below was accounted for as an asset acquisition.

20212022 Acquisitions

On September 21, 2021,During the six months ended June 30, 2022, we acquired New Senior Investment Group Inc. (“New Senior”)18 MOBs leased to affiliates of Ardent, 1 behavioral health center and 1 research and innovation center, all of which are reported within our office operations segment, and 1 senior housing community, which is reported within our SHOP segment, for aan aggregate purchase price of $2.3 billion in an all-stock transaction pursuant to an Agreement and Plan of Merger dated as of June 28, 2021 (the “Merger Agreement”) by and among Ventas, Cadence Merger Sub LLC, our wholly owned subsidiary (“Merger Sub”), and New Senior. Under the Merger Agreement, on the acquisition date, Merger Sub merged with and into New Senior, with New Senior surviving the merger as our wholly owned subsidiary (the “New Senior Acquisition”). The New Senior Acquisition was valued at approximately $2.4 billion. We funded the transaction through the issuance of approximately 13.3 million shares of our common stock, with each New Senior stockholder receiving 0.1561 shares of Ventas common stock for each share of New Senior common stock that they owned immediately prior to the acquisition. In addition to the equity issuance, we funded the acquisition through the assumption of $482.5 million of New Senior mortgage debt and $1.1 billion of cash paid at closing. We accounted for this transaction as an asset acquisition and the financial results of New Senior have been included in our consolidated financial statements from the acquisition date.$395.3 million.

Fourth Quarter Acquisitions
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VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

In November, we completed the approximately $180 million acquisition of 6 Canadian senior housing communities that will be operated under a management contract and the $58 million acquisition of a behavioral health center in Plano, Texas.


NOTE 5—DISPOSITIONS AND IMPAIRMENTS

20212022 Activity

During the ninesix months ended SeptemberJune 30, 2021,2022, we sold 27 MOBs and 6 triple-net leased properties1 vacant land parcel for aggregate consideration of $497.3$6.2 million and recognized a gain on the salessale of these assetsthis asset of $194.1$2.4 million.

Assets Held for Sale

The table below summarizes our real estate assets classified as held for sale, including the amounts reported on our Consolidated Balance Sheets, which may include anticipated post-closing settlements of working capital for disposed properties.properties (dollars in thousands):
As of September 30, 2021As of December 31, 2020
Number of Properties Held for SaleAssets Held for SaleLiabilities Related to Assets
Held for Sale
Number of Properties Held for SaleAssets Held for SaleLiabilities Related to Assets
Held for Sale
(Dollars in thousands)
Triple-Net Leased Properties$1,414 $621 $4,960 $2,690 
Office Operations (1)
12,813 2,096 — 15 101 
Senior Living Operations25 302,542 17,801 4,633 455 
Total32 $316,769 $20,518 $9,608 $3,246 

(1)2020 balances relate to anticipated post-closing settlements of working capital.
As of June 30, 2022As of December 31, 2021
Number of Properties Held for SaleAssets Held for SaleLiabilities Related to Assets
Held for Sale
Number of Properties Held for SaleAssets Held for SaleLiabilities Related to Assets
Held for Sale
SHOP22,787 4,093 24,964 9,321 
Office operations8,981 1,778 3,435 1,529 
Total$31,768 $5,871 $28,399 $10,850 

Real Estate Impairment

We recognized impairments of $173.0$26.9 million and $129.5$97.1 million respectively, for the ninesix months ended SeptemberJune 30, 2022 and 2021, and 2020,respectively, which are recorded primarily recorded inas a component of depreciation and amortization in our Consolidated Statements of Income. The impairments recorded during 2021 were primarily the result of a change in the expected future cash flows of the subject properties or a change in our intent to hold the impaired assets. In most cases, we recognize an impairment in the periods in which our change in intent is made.

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VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)


NOTE 6—LOANS RECEIVABLE AND INVESTMENTS

As of SeptemberJune 30, 20212022 and December 31, 2020,2021, we had $594.4$553.8 million and $900.2$549.2 million, respectively, of net loans receivable and investments relating to senior housing and healthcare operators or properties. The following is a summary of our loans receivable and investments, net, including amortized cost, fair value and unrealized gains or losses on available for sale investments:investments (dollars in thousands):    
Amortized CostAllowanceUnrealized GainCarrying AmountFair ValueAmortized CostAllowanceUnrealized (Loss) GainCarrying AmountFair Value
(In thousands)
As of September 30, 2021:
As of June 30, 2022:As of June 30, 2022:
Secured/mortgage loans and other, netSecured/mortgage loans and other, net$488,999 $— $— $488,999 $477,114 Secured/mortgage loans and other, net$488,611 $— $— $488,611 $458,700 
Government-sponsored pooled loan investments, net (1)
Government-sponsored pooled loan investments, net (1)
38,443 — 2,996 41,440 41,440 
Government-sponsored pooled loan investments, net (1)
41,300 — (281)41,019 41,019 
Total investments reported as secured loans receivable and investments, netTotal investments reported as secured loans receivable and investments, net527,442 — 2,996 530,439 518,554 Total investments reported as secured loans receivable and investments, net529,911 — (281)529,630 499,719 
Non-mortgage loans receivable, net (2)
Non-mortgage loans receivable, net (2)
69,618 (5,629)— 63,989 64,346 
Non-mortgage loans receivable, net (2)
29,462 (5,271)— 24,191 23,435 
Total loans receivable and investments, netTotal loans receivable and investments, net$597,060 $(5,629)$2,996 $594,428 $582,900 Total loans receivable and investments, net$559,373 $(5,271)$(281)$553,821 $523,154 
As of December 31, 2020:
As of December 31, 2021:As of December 31, 2021:
Secured/mortgage loans and other, netSecured/mortgage loans and other, net$555,840 $— $— $555,840 $508,707 Secured/mortgage loans and other, net$488,913 $— $— $488,913 $478,931 
Government-sponsored pooled loan investments, net55,154 (8,846)3,419 49,727 49,727 
Government-sponsored pooled loan investments, net (1)
Government-sponsored pooled loan investments, net (1)
39,376 — 1,836 41,213 41,213 
Total investments reported as secured loans receivable and investments, netTotal investments reported as secured loans receivable and investments, net610,994 (8,846)3,419 605,567 558,434 Total investments reported as secured loans receivable and investments, net528,289 — 1,836 530,126 520,144 
Non-mortgage loans receivable, net74,700 (17,623)— 57,077 57,009 
Marketable debt securities213,334 — 24,219 237,553 237,553 
Non-mortgage loans receivable, net (2)
Non-mortgage loans receivable, net (2)
24,418 (5,394)— 19,024 19,039 
Total loans receivable and investments, netTotal loans receivable and investments, net$899,028 $(26,469)$27,638 $900,197 $852,996 Total loans receivable and investments, net$552,707 $(5,394)$1,836 $549,150 $539,183 

(1)Investment in government-sponsored pool loans has a contractual maturity date in 2023.
(2)In October 2021, we received proceeds of $45.0 millionIncluded in full repayment of a note from Brookdale Senior Living.other assets on our Consolidated Balance Sheets.

2021 Activity

In October 2021, we received proceeds of $45.0 million in full repayment of a cash pay note from Brookdale Senior Living. The note was issued to us in connection with the modification of our lease with Brookdale Senior Living in the third quarter of 2020.

In July 2021, we received $66 million from Holiday Retirement as repayment in full of secured notes which Holiday Retirement previously issued to us as part of a lease termination transaction entered into in April 2020.

In July 2021, we received aggregate proceeds of $224 million from the redemption of Ardent’s outstanding 9.75% Senior Notes due 2026 at a price equal to 107.313% of the principal amount of the notes, plus accrued and unpaid interest. The redemption resulted in a gain of $16.6 million which is recorded in income from loans and investments in our Consolidated Statements of Income. As of December 31, 2020, $23.0 million of unrealized gain related to these securities was included in accumulated other comprehensive income.

In April 2021, we received $19.2 million in full repayment of certain government-sponsored pooled loan investments. In the first quarter of 2021, prior to such repayment, we reversed an $8.8 million allowance we had previously recorded in 2020 on this investment with a corresponding adjustment to allowance on loans receivable and investments in our Consolidated Statements of Income. There was no impact to our Consolidated Statements of Income from the loan repayment.

During the first quarter of 2021, we received aggregate proceeds of $16.5 million for the redemption and sale of marketable debt securities, resulting in total gains of $1.0 million which is recorded in income from loans and investments in our Consolidated Statements of Income. As of December 31, 2020, $1.2 million of unrealized gain was presented within accumulated other comprehensive income related to these securities. These securities had a weighted average interest rate of 8.3% and were due to mature between 2024 and 2026.
18

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)


In March 2021, $11.9 million of previously reserved non-mortgage loans were forgiven. We derecognized both the amortized cost bases and allowances for these loans during the quarter ended March 31, 2021.


NOTE 7—INVESTMENTS IN UNCONSOLIDATED ENTITIES

We report investments in unconsolidated entities over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. We are not required to consolidate these entities because our joint venture partners have significant participating rights, nor are these entities considered VIEs, as they are controlled by equity holders with sufficient capital. We invest in both real estate entities and operating entities, which are described further below.

Investments in Unconsolidated Real Estate Entities

Through our Ventas Investment Management Platform, which consolidates our extensive third-party capital ventures under a single brand and umbrella, we partner with third-party institutional investors to invest with us in healthcare real estate through various joint ventures and other co-investment vehicles where we are the sponsor or general partner.

19

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Below is a summary of our investments in unconsolidated real estate entities as of SeptemberJune 30, 20212022 and December 31, 2020, respectively:2021, respectively (dollars in thousands):
Ownership As of (1)
Carrying Amount As of
September 30, 2021December 31, 2020September 30, 2021December 31, 2020
(In thousands)
Investment in unconsolidated real estate entities:
Ventas Life Science & Healthcare Real Estate Fund21.1%22.9%$271,494 $279,983 
Pension Fund Joint Venture22.9%22.8%30,277 34,690 
Research & Innovation Development Joint Venture51.0%50.3%200,311 123,445 
Ventas Investment Management Platform502,082 438,118 
All other (2)
34.0%-50.0%34.0%-50.0%5,798 5,570 
Total investments in unconsolidated real estate entities$507,880 $443,688 
(1) The entities in which we have an ownership interest may have less than a 100% interest in the underlying real estate. The ownership percentages in the table reflect our interest in the underlying real estate. Joint venture members, including us in some instances, have equity participation rights based on the underlying performance of the investments which could result in non pro rata distributions.
(2) Includes investments in land parcels, parking structures and other de minimis investments in unconsolidated real estate entities.

In March 2021, the Ventas Life Science and Healthcare Real Estate Fund, L.P. (the “Ventas Fund”) acquired 2 Class-A life science properties in the Baltimore-DC life science cluster for $272 million, which increased assets under management of the Ventas Fund to $2.1 billion.
Ownership as of (1)
Carrying Amount as of
June 30, 2022December 31, 2021June 30, 2022December 31, 2021
Investment in unconsolidated real estate entities:
Ventas Life Science & Healthcare Real Estate Fund21.9%21.1%$261,630 $267,475 
Pension Fund Joint Venture22.9%22.9%27,532 29,192 
Research & Innovation Development Joint Venture50.7%51.0%239,478 221,363 
Ventas Investment Management Platform528,640 518,030 
All other (2)
34.0%-50.0%34.0%-50.0%5,065 5,435 
Total investments in unconsolidated real estate entities$533,705 $523,465 
______________________________
(1) The entities in which we have an ownership interest may have less than a 100% interest in the underlying real estate. The ownership percentages in the table reflect our interest in the underlying real estate. Joint venture members, including us in some instances, have equity participation rights based on the underlying performance of the investments which could result in non pro rata distributions.
(2) Includes investments in land parcels, parking structures and other de minimis investments in unconsolidated real estate entities.

We provide various services to our unconsolidated real estate entities in exchange for fees and reimbursements. Total management fees earned in connection with these services were $3.2$3.8 million and $1.5$3.0 million for the three months ended SeptemberJune 30, 20212022 and 2020,2021, respectively, and $8.9$7.3 million and $3.9$5.7 million for the ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, respectively. Such amounts are included in office building and other services revenue in our Consolidated Statements of Income.

Investments in Unconsolidated Operating Entities

We own investments in unconsolidated operating entities such as Ardent Atria and ESL,Atria, which are included within other assets on our Consolidated Balance Sheets. Our 34% ownership interest in Atria entitles us to customary minority rights and protections, including the right to appoint 2 of 6 members to the Atria Board of Directors. Our 34% ownership interest in ESL entitles us to customary minority rights and protections, including the right to appoint 2 of 6 members to the ESL Board of Directors. ESL management owns the 66% controlling interest. Our 9.8% ownership interest in Ardent entitles us to customary minority rights and protections, including the right to appoint 1 of 11 membersmember of the Ardent Board of Directors.

19
20

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)


NOTE 8—INTANGIBLES

The following is a summary of our intangibles:intangibles (dollars in thousands):
As of September 30, 2021As of December 31, 2020
BalanceRemaining
Weighted Average
Amortization
Period in Years
BalanceRemaining
Weighted Average
Amortization
Period in Years
As of June 30, 2022As of December 31, 2021
(Dollars in thousands) BalanceWeighted Average
Remaining Amortization
Period in Years
BalanceWeighted Average
Remaining Amortization
Period in Years
Intangible assets:Intangible assets:    Intangible assets:    
Above market lease intangibles$137,166 6.0$140,096 6.4
In-place and other lease intangibles1,235,296 6.81,090,790 10.7
Above-market lease intangibles (1)
Above-market lease intangibles (1)
$129,160 5.7$129,121 5.9
In-place and other lease intangibles (2)
In-place and other lease intangibles (2)
1,232,511 7.41,240,626 7.2
GoodwillGoodwill1,046,070 N/A1,051,650 N/AGoodwill1,044,509 N/A1,046,140 N/A
Other intangibles34,512 6.835,870 10.0
Other intangibles (2)
Other intangibles (2)
34,486 6.134,517 6.5
Accumulated amortizationAccumulated amortization(921,399)N/A(941,462)N/AAccumulated amortization(1,004,973)N/A(944,403)N/A
Net intangible assetsNet intangible assets$1,531,645 6.8$1,376,944 10.3Net intangible assets$1,435,693 7.3$1,506,001 7.1
Intangible liabilities:Intangible liabilities:   Intangible liabilities:   
Below market lease intangibles$334,437 9.8$339,265 14.3
Below-market lease intangibles (1)
Below-market lease intangibles (1)
$334,486 8.8$334,365 9.7
Other lease intangiblesOther lease intangibles13,498 N/A13,498 N/AOther lease intangibles13,498 N/A13,608 N/A
Accumulated amortizationAccumulated amortization(241,810)N/A(212,655)N/AAccumulated amortization(251,981)N/A(244,975)N/A
Purchase option intangiblesPurchase option intangibles3,568 N/A3,568 N/APurchase option intangibles3,568 N/A3,568 N/A
Net intangible liabilitiesNet intangible liabilities$109,693 9.8$143,676 14.3Net intangible liabilities$99,571 8.8$106,566 9.7

(1)     Amortization of above- and below-market lease intangibles is recorded as a decrease and an increase to revenues, respectively, in our Consolidated Statements of Income.

(2)
    Amortization of lease intangibles is recorded in depreciation and amortization in our Consolidated Statements of Income.
N/A—Not Applicable.

Above marketAbove-market lease intangibles and in-place and other lease intangibles are included in acquired lease intangibles within real estate investments on our Consolidated Balance Sheets. Other intangibles (including non-compete agreements, trade names and trademarks) are included in other assets on our Consolidated Balance Sheets. Below marketBelow-market lease intangibles, other lease intangibles and purchase option intangibles are included in accounts payable and other liabilities on our Consolidated Balance Sheets.


NOTE 9—OTHER ASSETS

The following is a summary of our other assets:assets (dollars in thousands):
As of September 30, 2021As of December 31, 2020
(In thousands)As of June 30, 2022As of December 31, 2021
Straight-line rent receivablesStraight-line rent receivables$173,591 $169,711 Straight-line rent receivables$181,661 $176,877 
Non-mortgage loans receivable, netNon-mortgage loans receivable, net63,989 57,077 Non-mortgage loans receivable, net24,191 19,024 
Stock warrantsStock warrants68,884 50,098 Stock warrants39,604 48,884 
Marketable debt securities— 237,553 
Other intangibles, netOther intangibles, net7,474 4,659 Other intangibles, net6,842 7,270 
Investment in unconsolidated operating entitiesInvestment in unconsolidated operating entities78,813 63,768 Investment in unconsolidated operating entities56,709 73,602 
OtherOther250,502 224,363 Other266,570 239,412 
Total other assetsTotal other assets$643,253 $807,229 Total other assets$575,577 $565,069 

Stock warrants represent warrants exercisable at any time prior to December 31, 2025, in whole or in part, for 16.3 million shares of Brookdale Senior Living common stock at an exercise price of $3.00 per share. These warrants are measured at fair value with changes in fair value being recognized within other expense in our Consolidated Statements of Income.

2021

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

NOTE 10—SENIOR NOTES PAYABLE AND OTHER DEBT

The following is a summary of our senior notes payable and other debt:debt (dollars in thousands):
As of September 30, 2021As of December 31, 2020
(In thousands)As of June 30, 2022As of December 31, 2021
Unsecured revolving credit facility (1)
Unsecured revolving credit facility (1)
$49,141 $39,395 
Unsecured revolving credit facility (1)
$45,594 $56,448 
Commercial paper notesCommercial paper notes370,000 — Commercial paper notes335,300 280,000 
Secured revolving construction credit facility due 2022— 154,098 
Floating Rate Senior Notes, Series F due 2021 (2)
236,630 235,664 
3.25% Senior Notes due 2022— 263,687 
3.30% Senior Notes, Series C due 2022 (2)
197,192 196,386 
Unsecured term loan due 2023Unsecured term loan due 2023200,000 200,000 Unsecured term loan due 2023— 200,000 
3.125% Senior Notes due 2023— 400,000 
3.10% Senior Notes due 2023— 400,000 
2.55% Senior Notes, Series D due 2023 (2)
2.55% Senior Notes, Series D due 2023 (2)
216,911 216,025 
2.55% Senior Notes, Series D due 2023 (2)
213,642 217,667 
3.50% Senior Notes due 20243.50% Senior Notes due 2024400,000 400,000 3.50% Senior Notes due 2024400,000 400,000 
3.75% Senior Notes due 20243.75% Senior Notes due 2024400,000 400,000 3.75% Senior Notes due 2024400,000 400,000 
4.125% Senior Notes, Series B due 2024 (2)
4.125% Senior Notes, Series B due 2024 (2)
197,192 196,386 
4.125% Senior Notes, Series B due 2024 (2)
194,220 197,879 
2.80% Senior Notes, Series E due 2024 (2)
2.80% Senior Notes, Series E due 2024 (2)
473,261 471,328 
2.80% Senior Notes, Series E due 2024 (2)
466,128 474,909 
Unsecured term loan due 2025 (2)
Unsecured term loan due 2025 (2)
394,384 392,773 
Unsecured term loan due 2025 (2)
388,440 395,757 
3.50% Senior Notes due 20253.50% Senior Notes due 2025600,000 600,000 3.50% Senior Notes due 2025600,000 600,000 
2.65% Senior Notes due 20252.65% Senior Notes due 2025450,000 450,000 2.65% Senior Notes due 2025450,000 450,000 
4.125% Senior Notes due 20264.125% Senior Notes due 2026500,000 500,000 4.125% Senior Notes due 2026500,000 500,000 
3.25% Senior Notes due 20263.25% Senior Notes due 2026450,000 450,000 3.25% Senior Notes due 2026450,000 450,000 
Unsecured term loan due 2027Unsecured term loan due 2027500,000 — 
2.45% Senior Notes, Series G due 2027 (2)
2.45% Senior Notes, Series G due 2027 (2)
369,018 375,970 
3.85% Senior Notes due 20273.85% Senior Notes due 2027400,000 400,000 3.85% Senior Notes due 2027400,000 400,000 
4.00% Senior Notes due 20284.00% Senior Notes due 2028650,000 650,000 4.00% Senior Notes due 2028650,000 650,000 
4.40% Senior Notes due 20294.40% Senior Notes due 2029750,000 750,000 4.40% Senior Notes due 2029750,000 750,000 
3.00% Senior Notes due 20303.00% Senior Notes due 2030650,000 650,000 3.00% Senior Notes due 2030650,000 650,000 
4.75% Senior Notes due 20304.75% Senior Notes due 2030500,000 500,000 4.75% Senior Notes due 2030500,000 500,000 
2.50% Senior Notes due 20312.50% Senior Notes due 2031500,000 — 2.50% Senior Notes due 2031500,000 500,000 
3.30% Senior Notes, Series H due 2031 (2)
3.30% Senior Notes, Series H due 2031 (2)
233,064 237,454 
6.90% Senior Notes due 2037 (3)
6.90% Senior Notes due 2037 (3)
52,400 52,400 
6.90% Senior Notes due 2037 (3)
52,400 52,400 
6.59% Senior Notes due 2038 (3)
6.59% Senior Notes due 2038 (3)
22,823 22,823 
6.59% Senior Notes due 2038 (3)
22,823 22,823 
5.70% Senior Notes due 20435.70% Senior Notes due 2043300,000 300,000 5.70% Senior Notes due 2043300,000 300,000 
4.375% Senior Notes due 20454.375% Senior Notes due 2045300,000 300,000 4.375% Senior Notes due 2045300,000 300,000 
4.875% Senior Notes due 20494.875% Senior Notes due 2049300,000 300,000 4.875% Senior Notes due 2049300,000 300,000 
Mortgage loans and otherMortgage loans and other2,582,812 2,092,106 Mortgage loans and other2,422,866 2,431,831 
TotalTotal12,142,746 11,983,071 Total12,393,495 12,093,138 
Deferred financing costs, netDeferred financing costs, net(71,313)(68,343)Deferred financing costs, net(66,963)(69,925)
Unamortized fair value adjustmentUnamortized fair value adjustment35,316 12,618 Unamortized fair value adjustment28,165 32,888 
Unamortized discountsUnamortized discounts(27,914)(31,934)Unamortized discounts(26,557)(28,557)
Senior notes payable and other debtSenior notes payable and other debt$12,078,835 $11,895,412 Senior notes payable and other debt$12,328,140 $12,027,544 

(1)As of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively, $23.3 million and $12.2$30.9 million of aggregate borrowings were denominated in Canadian dollars. Aggregate borrowings of $25.9$22.3 million and $27.2$25.6 million were denominated in British pounds as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively.
(2)Canadian Dollar debt obligations shown in U.S. Dollars.
(3)Our 6.90% senior notes due 2037 are subject to repurchase at the option of the holders, at par, on October 1, 2027, and our 6.59% senior notes due 2038 are subject to repurchase at the option of the holders, at par, on July 7 in each of 2023 and 2028.

2122

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

Credit Facilities, Commercial Paper and Unsecured Term Loans

In January 2021, we entered into an amended and restated unsecured credit facility (the “New Credit Facility”) comprised ofWe have a $2.75 billion unsecured revolving credit facility initially priced at LIBOR plus 0.825% based on the Company’s debt rating. The New Credit Facility replaced our previous $3.0 billion unsecured revolving credit facility priced at 0.875%. The New Credit Facility matures in January 2025, but may be extended at our option, subject to the satisfaction of certain conditions, for 2 additional periods of six months each. The New Credit Facilityunsecured revolving credit facility also includes an accordion feature that permits us to increase our aggregate borrowing capacity thereunder to up to $3.75 billion, subject to the satisfaction of certain conditions.

As of SeptemberJune 30, 2021,2022, we had $2.7 billion of undrawn capacity on our New Credit Facilityunsecured revolving credit facility with $49.1$45.6 million borrowings outstanding and an additional $24.9$25.0 million restricted to support outstanding letters of credit. We limit our use of the New Credit Facility,unsecured revolving credit facility, to the extent necessary, to support our commercial paper program when commercial paper notes are outstanding. As of September 30, 2021, we had $370.0 million of commercial paper outstanding.

Our wholly owned subsidiary, Ventas Realty, Limited Partnership (“Ventas Realty”), may issue from time to time unsecured commercial paper notes up to a maximum aggregate amount outstanding at any time of $1.0 billion. The notes are sold under customary terms in the U.S. commercial paper note market and are ranked pari passu with all of Ventas Realty’s other unsecured senior indebtedness. The notes are fully and unconditionally guaranteed by Ventas, Inc. As of SeptemberJune 30, 2021,2022, we had $370.0$335.3 million in borrowings outstanding under our commercial paper program.

As of September 30, 2021,In June 2022, we hadentered into a Credit and Guaranty Agreement (the “New Credit Agreement”) with Ventas Realty, as borrower. The New Credit Agreement replaces Ventas Realty’s previous $200.0 million unsecured term loan priced at LIBOR plus 0.90% that matured in 2023 with a new $500.0 million unsecured term loan that matures in 2023.2027 and is initially priced at Term SOFR plus 0.95% based on Ventas Realty’s debt ratings. The term loanNew Credit Agreement also includes an accordion feature that effectively permits us to increase our aggregate borrowings thereunder to up to $800.0 million.$1.25 billion, subject to the satisfaction of certain conditions, including the receipt of additional commitments for such increase.

As of SeptemberJune 30, 2021,2022, we had a C$500500.0 million unsecured term loan facility priced at Canadian Dollar Offered Rate (“CDOR”) plus 0.90% that matures in 2025.

During the three months ended September 30, 2021, we terminated the $400.0 million secured revolving construction credit facility, resulting in a loss on extinguishment of debt of $0.5 million for the three months ended September 30, 2021. There were 0 borrowings outstanding under the secured revolving construction credit facility as of September 30, 2021.

Senior Notes

In August 2021, Ventas Realty issued and sold $500.0 million aggregate principal amount of 2.50% senior notes due 2031 at 99.74% of par.

In August 2021, Ventas Realty issued a make whole notice of redemption for the entirety of the $400.0 million aggregate principal amount of 3.125% senior notes due 2023, resulting in a loss on extinguishment of debt of $20.9 million for the three months ended September 30, 2021. The redemption settled in September 2021, principally using cash on hand.

In July 2021, Ventas Realty and Ventas Capital Corporation issued a make whole notice of redemption for the entirety of the $263.7 million aggregate principal amount of 3.25% senior notes due 2022, resulting in a loss on extinguishment of debt of $8.2 million for the three months ended September 30, 2021. The redemption settled in August 2021, principally using cash on hand.

In February 2021, Ventas Realty issued a make whole notice of redemption for the entirety of the $400.0 million aggregate principal amount of 3.10% senior notes due January 2023, resulting in a loss on extinguishment of debt of $27.3 million for the three months ended March 31, 2021. The redemption settled in March 2021, principally using cash on hand.

Mortgages

In September 2021, we assumed $482.5 million in mortgage debt in connection with the New Senior Acquisition, including a $25.4 million fair value premium which will be amortized over the remaining term through interest expense in our Consolidated Statement of Income. See “Note 4 – Acquisitions Of Real Estate Property”.

22

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

As of SeptemberJune 30, 2021,2022, our indebtedness had the following maturities:maturities (dollars in thousands):
Principal Amount
Due at Maturity
Unsecured
Revolving Credit
Facility and Commercial Paper Notes (1)
Scheduled Periodic
Amortization
Total MaturitiesPrincipal Amount
Due at Maturity
Unsecured
Revolving Credit
Facility and Commercial Paper Notes (1)
Scheduled Periodic
Amortization
Total Maturities
(In thousands)
2021$293,626 $370,000 $15,082 $678,708 
20222022564,208 — 52,150 616,358 2022$222,596 $335,300 $27,024 $584,920 
20232023810,886 — 38,684 849,570 2023489,206 — 42,970 532,176 
202420241,636,695 — 32,915 1,669,610 20241,654,004 — 37,420 1,691,424 
202520252,045,971 49,141 26,761 2,121,873 20252,039,042 45,594 31,454 2,116,090 
202620261,034,759 — 24,709 1,059,468 
ThereafterThereafter6,077,692 — 128,935 6,206,627 Thereafter6,271,898 — 137,519 6,409,417 
Total maturitiesTotal maturities$11,429,078 $419,141 $294,527 $12,142,746 Total maturities$11,711,505 $380,894 $301,096 $12,393,495 

(1)At SeptemberJune 30, 2021,2022, we had $275.4$253.8 million of borrowings outstanding under our unsecured revolving credit facility and commercial paper program, net of $143.8$127.1 million of unrestricted cash and cash equivalents.

23

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 11—FAIR VALUES OF FINANCIAL INSTRUMENTS

The carrying amounts and fair values of our financial instruments were as follows:follows (dollars in thousands):
As of September 30, 2021As of December 31, 2020
Carrying
Amount
Fair ValueCarrying
Amount
Fair Value As of June 30, 2022As of December 31, 2021
(In thousands) Carrying
Amount
Fair ValueCarrying
Amount
Fair Value
Assets:Assets:    Assets:    
Cash and cash equivalentsCash and cash equivalents$143,770 $143,770 $413,327 $413,327 Cash and cash equivalents$127,073 $127,073 $149,725 $149,725 
Escrow deposits and restricted cashEscrow deposits and restricted cash52,752 52,752 38,313 38,313 Escrow deposits and restricted cash48,958 48,958 46,872 46,872 
Stock warrantsStock warrants68,884 68,884 50,098 50,098 Stock warrants39,604 39,604 48,884 48,884 
Secured mortgage loans and other, netSecured mortgage loans and other, net488,999 477,114 555,840 508,707 Secured mortgage loans and other, net488,611 458,700 488,913 478,931 
Non-mortgage loans receivable, net63,989 64,346 57,077 57,009 
Marketable debt securities— — 237,553 237,553 
Non-mortgage loans receivable, net (1)
Non-mortgage loans receivable, net (1)
24,191 23,435 19,024 19,039 
Government-sponsored pooled loan investments, netGovernment-sponsored pooled loan investments, net41,440 41,440 49,727 49,727 Government-sponsored pooled loan investments, net41,019 41,019 41,213 41,213 
Derivative instruments763 763 
Derivative instruments (1)
Derivative instruments (1)
19,757 19,757 1,128 1,128 
Liabilities:Liabilities:Liabilities:
Senior notes payable and other debt, grossSenior notes payable and other debt, gross12,142,746 13,040,731 11,983,071 13,075,337 Senior notes payable and other debt, gross12,393,495 11,834,464 12,093,138 12,891,937 
Derivative instruments16,286 16,286 28,338 28,338 
Derivative instruments (2)
Derivative instruments (2)
— — 12,290 12,290 
Redeemable OP UnitsRedeemable OP Units194,424 194,424 145,983 145,983 Redeemable OP Units182,512 182,512 182,112 182,112 
______________________________
(1)Included in other assets on our Consolidated Balance Sheets.
(2)Included in accounts payable and other liabilities on our Consolidated Balance Sheets.

For a discussion of the assumptions considered, refer to “Note 2 – Accounting Policies.” The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the estimates presented above are not necessarily indicative of the amounts we would realize in a current market exchange.


NOTE 12—LITIGATION

Litigation Related to the New Senior Acquisition

Following announcement of the New Senior Acquisition, purported stockholders of New Senior filed 9 complaints relating thereto in federal district court against New Senior and New Senior’s board of directors (collectively, the “Federal Complaints”). NaN of the complaints also named Ventas and Merger Sub as a defendant. The Federal Complaints alleged violations of Section 14(a) and 20(a) of the Securities Exchange Act of 1934 (the “Act”). In addition, 1 purported stockholder
23

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

of New Senior filed a lawsuit relating to the New Senior Acquisition in state court against New Senior, New Senior’s board of directors, and Ventas alleging fraudulent and negligent misrepresentation and concealment under New York law (the “State Court Action”). Ventas believes that the Federal Complaints and the State Court Action were without merit.

On September 7, 2021, without conceding that any further disclosures were required under applicable law, New Senior issued supplemental disclosures on a Form 8-K addressing certain of the alleged deficiencies in the proxy statement. Thereafter, between September 7, 2021 and the filing of this Quarterly Report on Form 10-Q, all of the Federal Complaints were dismissed and, without conceding any liability, and solely to reduce the risk of any potential disruption or delay to the closing of the New Senior Acquisition and to minimize potential cost and expense, New Senior, New Senior’s board and Ventas entered into a settlement of the State Court Action.

Other LitigationCOMMITMENTS AND CONTINGENCIES

From time to time, we are party to other various lawsuits, investigations, claims and other legal and regulatory proceedings arising in connection with our business. These legal and regulatory matters may include, among other things, professional liability and general liability claims, commercial liability claims, unfair business practice claims and employment claims, as well as regulatory proceedings, including proceedings related to our senior living operations,housing operating portfolio, where we are typically the holder of the applicable healthcare license. In certain circumstances, regardless of whether we are a named party in a lawsuit, investigation, claim or other legal or regulatory proceeding, we may be contractually obligated to indemnify, defend and hold harmless our tenants, operators, managers or other third parties against, or may otherwise be responsible for, such actions, proceedings or claims. In other circumstances, certain of our tenants, operators, managers or other third parties may be obligated to indemnify, defend and hold us harmless in whole or in part with respect to certain actions, legal or regulatory proceedings. We cannot assure you that these third parties will be able to satisfy their defense and indemnification obligations to us. Legal and regulatory matters to which we are subject or for which we are otherwise responsible may not be fully insured and some may allege large damage amounts.

It is the opinion of management that the disposition of any such lawsuits, investigations, claims and other legal and regulatory proceedings that are currently pending will not, individually or in the aggregate, have a material adverse effect on us. However, regardless of the merits of a particular legal or regulatory matter, we may be forced to expend significant financial resources to defend and resolve these matters. We are unable to predict the ultimate outcome of these lawsuits, investigations, claims and other legal and regulatory proceedings, and if management’s assessment of our liability with respect thereto is incorrect, such legal or regulatory matters could have a material adverse effect on us.

24

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 13—INCOME TAXES

We have elected to be taxed as a REIT under the applicable provisions of the Internal Revenue Code of 1986, as amended, for every year beginning with the year ended December 31, 1999. We have also elected for certain of our subsidiaries to be treated as taxable REIT subsidiaries (“TRS” or “TRS entities”), which are subject to federal, state and foreign income taxes. All entities other than the TRS entities are collectively referred to as the “REIT” within this note. Certain REIT entities are subject to foreign income tax.

Although the TRS entities and certain other foreign entities have paid minimal federal, state and foreign income taxes for the ninesix months ended SeptemberJune 30, 2021,2022, their income tax liabilities may increase in future periods as we exhaust net operating loss (“NOL”) carryforwards and as our senior living and other operations grow. Such increases could be significant.

Our consolidated provision for income taxes for the three months ended SeptemberJune 30, 2022 and 2021 and 2020 was an expensea benefit of $3.8 million and a benefitan expense of $3.2$3.6 million, respectively. Our consolidated provision for income taxes for the ninesix months ended SeptemberJune 30, 2022 and 2021 was a benefit of $8.3 million and 2020 was an expense of $9.6$5.8 million, respectively. The income tax benefit for the three and six months ended June 30, 2022 was primarily due to losses in certain of our TRS entities and a $2.0 million benefit from an internal restructuring of $95.9 million, respectively.a U.S. taxable REIT subsidiary. The income tax expense for the three and six months ended SeptemberJune 30, 2021 was primarily due to a $3.7 million deferred tax expense related to the release of certain residual tax effects from marketable debt securities. The income tax expense for the nine months ended September 30, 2021 was primarily due to a $3.7 million deferred tax expense related to the release of certain residual tax effects from marketable debt securities, a $2.9$2.8 million net deferred tax expense related to an internal restructuring of certain U.S. taxable REIT subsidiaries, and a $3.4 million deferred tax expense related to the revaluation of certain deferred tax liabilities as a result of enacted tax rate changes in the UK.United Kingdom.

Each TRS is a tax paying component for purposes of classifying deferred tax assets and liabilities. Deferred tax liabilities with respect to our TRS entities totaled $65.2$46.6 million and $62.6$59.3 million as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively, and related primarily to differences between the financial reporting and tax bases of fixed and intangible
24

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)
assets, net of loss carryforwards. Deferred tax assets with respect to our TRS entities totaled $11.5 million and $10.0$11.2 million as of Septemberboth June 30, 20212022 and December 31, 2020, respectively,2021 and related primarily to loss carryforwards.
    
Generally, we are subject to audit under the statute of limitations by the Internal Revenue Service for the year ended December 31, 2018 and subsequent years and are subject to audit by state taxing authorities for the year ended December 31, 2017 and subsequent years. We are subject to audit generally under the statutes of limitation by the Canada Revenue Agency and provincial authorities with respect to the Canadian entities for the year ended December 31, 2017 and subsequent years. We are subject to audit in the United Kingdom generally for periods ended in and subsequent to 2020.


NOTE 14—STOCKHOLDERS' EQUITY

Capital Stock

In September 2021, we issued approximately 13.3 million shares of our common stockWe participate in connection with the New Senior Acquisition.

From time to time, we may sell our common stock under an “at-the-market” equity offering program (“ATM program”)., pursuant to which we may, from time to time, sell up to $1.0 billion aggregate gross sales price of shares of our common stock. There were no issuances under the ATM program for the six months ended June 30, 2022. As of SeptemberJune 30, 2021, we had $129.0 million remaining under our existing ATM program. During the three months ended September 30, 2021, we sold 10.6 million2022, $1.0 billion aggregate gross sales price of shares of our common stock remains available for issuance under ourthe ATM program for gross proceeds of $611.7 million, representing an average price of $57.73 per share. During the nine months ended September 30, 2021, we sold 10.9 million shares of our common stock under our ATM program for gross proceeds of $626.4 million, representing an average price of $57.71 per share. program.

Accumulated Other Comprehensive Loss

The following is a summary of our accumulated other comprehensive loss:loss (dollars in thousands):
As of September 30, 2021As of December 31, 2020
 (In thousands)
Foreign currency translation$(56,250)$(51,947)
Available for sale securities2,996 25,712 
Derivative instruments(14,347)(28,119)
Total accumulated other comprehensive loss$(67,601)$(54,354)

As of June 30, 2022As of December 31, 2021
Foreign currency translation loss$(74,852)$(56,227)
Unrealized (loss) gain on available for sale securities(281)1,836 
Unrealized gain (loss) on derivative instruments18,778 (10,129)
Total accumulated other comprehensive loss$(56,355)$(64,520)

25

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

NOTE 15—EARNINGS PER SHARE

The following table shows the amounts used in computing our basic and diluted earnings per share:share (in thousands, except per share amounts):
For the Three Months Ended September 30,For the Nine Months Ended September 30,
2021202020212020 For the Three Months Ended June 30,For the Six Months Ended June 30,
(In thousands, except per share amounts) 2022202120222021
Numerator for basic and diluted earnings per share:Numerator for basic and diluted earnings per share:  Numerator for basic and diluted earnings per share:  
Income from continuing operations$62,774 $13,737 $95,664 $329,232 
Net income62,774 13,737 95,664 329,232 
(Loss) income from continuing operations(Loss) income from continuing operations$(41,202)$88,288 $(610)$32,890 
Net (loss) incomeNet (loss) income(41,202)88,288 (610)32,890 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests2,094 986 5,802 534 Net income attributable to noncontrolling interests1,214 1,897 3,074 3,708 
Net income attributable to common stockholders$60,680 $12,751 $89,862 $328,698 
Net (loss) income attributable to common stockholdersNet (loss) income attributable to common stockholders$(42,416)$86,391 $(3,684)$29,182 
Denominator:Denominator:  Denominator:  
Denominator for basic earnings per share—weighted average sharesDenominator for basic earnings per share—weighted average shares381,996 373,177 377,271 372,997 Denominator for basic earnings per share—weighted average shares399,592 375,067 399,445 374,869 
Effect of dilutive securities:Effect of dilutive securities:  Effect of dilutive securities:  
Stock optionsStock options72 — 45 — Stock options41 58 33 34 
Restricted stock awardsRestricted stock awards404 163 340 147 Restricted stock awards376 328 398 304 
OP unitholder interestsOP unitholder interests3,051 2,955 2,987 2,968 OP unitholder interests3,517 2,954 3,517 2,954 
Denominator for diluted earnings per share—adjusted weighted average sharesDenominator for diluted earnings per share—adjusted weighted average shares385,523 376,295 380,643 376,112 Denominator for diluted earnings per share—adjusted weighted average shares403,526 378,408 403,393 378,161 
Basic earnings per share:Basic earnings per share:  Basic earnings per share:  
Income from continuing operations$0.16 $0.04 $0.25 $0.88 
Net income attributable to common stockholders0.16 0.03 0.24 0.88 
Diluted earnings per share:    
Income from continuing operations$0.16 $0.04 $0.25 $0.88 
Net income attributable to common stockholders0.16 0.03 0.24 0.87 
(Loss) income from continuing operations(Loss) income from continuing operations$(0.10)$0.24 $— $0.09 
Net (loss) income attributable to common stockholdersNet (loss) income attributable to common stockholders(0.11)0.23 (0.01)0.08 
Diluted earnings per share: (1)
Diluted earnings per share: (1)
    
(Loss) income from continuing operations(Loss) income from continuing operations$(0.10)$0.23 $— $0.09 
Net (loss) income attributable to common stockholdersNet (loss) income attributable to common stockholders(0.11)0.23 (0.01)0.08 

(1)     Potential common shares are not included in the computation of diluted earnings per share when a loss from continuing operations exists as the effect would be an antidilutive per share amount.

NOTE 16—SEGMENT INFORMATION

As of SeptemberJune 30, 2021,2022, we operated through 3 reportable business segments: triple-net leased properties, senior living operationsSHOP and office operations. In our triple-net leased properties reportable business segment, we invest in and own senior housing and healthcare properties throughout the United States and the United Kingdom and lease those properties to healthcare operating companies under “triple-net” or “absolute-net” leases that obligate the tenants to pay all property-related expenses. In our senior living operationsSHOP reportable business segment, we invest in senior housing communities throughout the United States and Canada and engage independent operators, such as Atria and Sunrise, to manage those communities. In our office operations reportable business segment, we primarily acquire, own, develop, lease and manage MOBs and life science, research and innovation centers throughout the United States. Information provided for “all other”“non-segment” includes income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to any of our 3 reportable business segments. Assets included in “all other”“non-segment” consist primarily of corporate assets, including cash, restricted cash, loans receivable and investments, and miscellaneous accounts receivable.

Our chief operating decision makers evaluate performance of the combined properties in each reportable business segment and determine how to allocate resources to those segments, in significant part, based on segment NOI and related measures. We define segment NOI as total revenues, less interest and other income, property-level operating expenses and office building and other services costs. We consider segment NOI useful because it allows investors, analysts and our management to measure unlevered property-level operating results and to compare our operating results to the operating results of other real estate companies between periods on a consistent basis. In order to facilitate a clear understanding of our historical consolidated operating results, segment NOI should be examined in conjunction with net income attributable to common stockholders as presented in our Consolidated Financial Statements and other financial data included elsewhere in this Quarterly Report on Form 10-Q. See “Non-GAAP
26

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure and reconciliations of net income attributable to common stockholders, as computed in accordance with GAAP, to NOI.

Interest expense, depreciation and amortization, general, administrative and professional fees, income tax expense and other non-property specific revenues and expenses are not allocated to individual reportable business segments for purposes of assessing segment performance. There are no intersegment sales or transfers.
26

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)


Summary information by reportable business segment is as follows:follows (dollars in thousands):
For the Three Months Ended September 30, 2021
Triple-Net
Leased
Properties
Senior
Living
Operations
Office
Operations
All
Other
Total
 (In thousands)
Revenues:     
Rental income$181,379 $— $201,673 $— $383,052 
Resident fees and services— 558,039 — — 558,039 
Office building and other services revenue— — 2,872 2,969 5,841 
Income from loans and investments— — — 28,729 28,729 
Interest and other income— — — 417 417 
Total revenues$181,379 $558,039 $204,545 $32,115 $976,078 
Total revenues$181,379 $558,039 $204,545 $32,115 $976,078 
Less:     
Interest and other income— — — 417 417 
Property-level operating expenses3,268 453,659 66,401 — 523,328 
Office building services costs— — 522 — 522 
Segment NOI$178,111 $104,380 $137,622 $31,698 451,811 
Interest and other income    417 
Interest expense    (108,816)
Depreciation and amortization    (313,596)
General, administrative and professional fees    (30,259)
Loss on extinguishment of debt, net(29,792)
Merger-related expenses and deal costs    (22,662)
Allowance on loans receivable and investments60 
Other    (33,673)
Income from unconsolidated entities2,772 
Gain on real estate dispositions150,292 
Income tax expense    (3,780)
Income from continuing operations    62,774 
Net income62,774 
Net income attributable to noncontrolling interests2,094 
Net income attributable to common stockholders$60,680 
For the Three Months Ended June 30, 2022
SHOPOffice
Operations
Triple-Net
Leased
Properties
Non-SegmentTotal
Revenues:     
Rental income$— $199,241 $149,397 $— $348,638 
Resident fees and services658,056 — — — 658,056 
Office building and other services revenue— 670 — 3,656 4,326 
Income from loans and investments— — — 10,752 10,752 
Interest and other income— — — 1,166 1,166 
Total revenues$658,056 $199,911 $149,397 $15,574 $1,022,938 
Total revenues$658,056 $199,911 $149,397 $15,574 $1,022,938 
Less:     
Interest and other income— — — 1,166 1,166 
Property-level operating expenses507,446 63,328 3,585 — 574,359 
Office building and other services costs— — — 1,4101,410 
NOI$150,610 $136,583 $145,812 $12,998 446,003 
Interest and other income    1,166 
Interest expense    (113,951)
Depreciation and amortization    (283,075)
General, administrative and professional fees    (32,915)
Loss on extinguishment of debt, net(7)
Transaction expenses and deal costs    (13,078)
Allowance on loans receivable and investments62 
Other    (48,116)
Loss from unconsolidated entities(1,047)
Loss on real estate dispositions(34)
Income tax benefit    3,790 
Loss from continuing operations    (41,202)
Net loss(41,202)
Net income attributable to noncontrolling interests1,214 
Net loss attributable to common stockholders$(42,416)

27

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

For the Three Months Ended September 30, 2020
Triple-Net
Leased
Properties
Senior
Living
Operations
Office
Operations
All
Other
TotalFor the Three Months Ended June 30, 2021
(In thousands)SHOPOffice
Operations
Triple-Net
Leased
Properties
Non-SegmentTotal
Revenues:Revenues:     Revenues:     
Rental incomeRental income$156,136 $— $198,376 $— $354,512 Rental income$— $200,388 $159,223 $— $359,611 
Resident fees and servicesResident fees and services— 541,322 — — 541,322 Resident fees and services535,952 — — — 535,952 
Office building and other services revenueOffice building and other services revenue— — 2,440 1,428 3,868 Office building and other services revenue— 2,540 — 2,841 5,381 
Income from loans and investmentsIncome from loans and investments— — — 18,666 18,666 Income from loans and investments— — — 17,665 17,665 
Interest and other incomeInterest and other income— — — 572 572 Interest and other income— — — 585 585 
Total revenuesTotal revenues$156,136 $541,322 $200,816 $20,666 $918,940 Total revenues$535,952 $202,928 $159,223 $21,091 $919,194 
Total revenuesTotal revenues$156,136 $541,322 $200,816 $20,666 $918,940 Total revenues$535,952 $202,928 $159,223 $21,091 $919,194 
Less:Less:     Less:     
Interest and other incomeInterest and other income— — — 572 572 Interest and other income— — — 585 585 
Property-level operating expensesProperty-level operating expenses5,398 422,653 66,934 — 494,985 Property-level operating expenses424,813 64,950 4,432 — 494,195 
Office building services costs— — 557 — 557 
Segment NOI$150,738 $118,669 $133,325 $20,094 422,826 
Office building and other services costsOffice building and other services costs— 658 — — 658 
NOINOI$111,139 $137,320 $154,791 $20,506 423,756 
Interest and other incomeInterest and other income    572 Interest and other income    585 
Interest expenseInterest expense    (115,505)Interest expense    (110,051)
Depreciation and amortizationDepreciation and amortization    (249,366)Depreciation and amortization    (250,700)
General, administrative and professional feesGeneral, administrative and professional fees    (32,081)General, administrative and professional fees    (30,588)
Loss on extinguishment of debt, net(7,386)
Merger-related expenses and deal costs    (11,325)
Gain on extinguishment of debt, netGain on extinguishment of debt, net74 
Transaction expenses and deal costsTransaction expenses and deal costs    (721)
Allowance on loans receivable and investmentsAllowance on loans receivable and investments(4,999)Allowance on loans receivable and investments59 
OtherOther    (5,681)Other    13,490 
Income from unconsolidated entitiesIncome from unconsolidated entities865 Income from unconsolidated entities4,767 
Gain on real estate dispositionsGain on real estate dispositions12,622 Gain on real estate dispositions41,258 
Income tax benefit    3,195 
Income tax expenseIncome tax expense    (3,641)
Income from continuing operationsIncome from continuing operations    13,737 Income from continuing operations    88,288 
Net incomeNet income13,737 Net income88,288 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests986 Net income attributable to noncontrolling interests1,897 
Net income attributable to common stockholdersNet income attributable to common stockholders$12,751 Net income attributable to common stockholders$86,391 

28

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)



For the Nine Months Ended September 30, 2021
Triple-Net
Leased
Properties
Senior
Living
Operations
Office
Operations
All
Other
TotalFor the Six Months Ended June 30, 2022
(In thousands)SHOPOffice
Operations
Triple-Net
Leased
Properties
Non-SegmentTotal
Revenues:Revenues:     Revenues:     
Rental incomeRental income$500,487 $— $599,516 $— $1,100,003 Rental income$— $399,781 $300,958 $— $700,739 
Resident fees and servicesResident fees and services— 1,622,641 — — 1,622,641 Resident fees and services1,309,177 — — — 1,309,177 
Office building and other services revenueOffice building and other services revenue— — 7,756 8,416 16,172 Office building and other services revenue— 1,287 — 6,988 8,275 
Income from loans and investmentsIncome from loans and investments— — — 65,404 65,404 Income from loans and investments— — — 20,599 20,599 
Interest and other incomeInterest and other income— — — 1,343 1,343 Interest and other income— — — 1,702 1,702 
Total revenuesTotal revenues$500,487 $1,622,641 $607,272 $75,163 $2,805,563 Total revenues$1,309,177 $401,068 $300,958 $29,289 $2,040,492 
Total revenuesTotal revenues$500,487 $1,622,641 $607,272 $75,163 $2,805,563 Total revenues$1,309,177 $401,068 $300,958 $29,289 $2,040,492 
Less:Less:     Less:     
Interest and other incomeInterest and other income— — — 1,343 1,343 Interest and other income— — — 1,702 1,702 
Property-level operating expensesProperty-level operating expenses12,525 1,296,301 195,297 — 1,504,123 Property-level operating expenses982,976 126,511 7,593 — 1,117,080 
Office building services costs— — 1,798 — 1,798 
Segment NOI$487,962 $326,340 $410,177 $73,820 1,298,299 
Office building and other services costsOffice building and other services costs— — — 2,723 2,723 
NOINOI$326,201 $274,557 $293,365 $24,864 918,987 
Interest and other incomeInterest and other income    1,343 Interest and other income    1,702 
Interest expenseInterest expense    (329,634)Interest expense    (224,745)
Depreciation and amortizationDepreciation and amortization    (878,444)Depreciation and amortization    (572,139)
General, administrative and professional feesGeneral, administrative and professional fees    (101,156)General, administrative and professional fees    (75,913)
Loss on extinguishment of debt, netLoss on extinguishment of debt, net(56,808)Loss on extinguishment of debt, net(7)
Merger-related expenses and deal costs    (28,000)
Transaction expenses and deal costsTransaction expenses and deal costs    (33,070)
Allowance on loans receivable and investmentsAllowance on loans receivable and investments9,021 Allowance on loans receivable and investments116 
OtherOther    (10,755)Other    (20,926)
Income from unconsolidated entities7,289 
Loss from unconsolidated entitiesLoss from unconsolidated entities(5,316)
Gain on real estate dispositionsGain on real estate dispositions194,083 Gain on real estate dispositions2,421 
Income tax expense    (9,574)
Income from continuing operations95,664 
Net income95,664 
Income tax benefitIncome tax benefit    8,280 
Loss from continuing operationsLoss from continuing operations(610)
Net lossNet loss(610)
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests5,802 Net income attributable to noncontrolling interests3,074 
Net income attributable to common stockholders    $89,862 
Net loss attributable to common stockholdersNet loss attributable to common stockholders    $(3,684)


29

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

For the Nine Months Ended September 30, 2020
Triple-Net
Leased
Properties
Senior
Living
Operations
Office
Operations
All
Other
TotalFor the Six Months Ended June 30, 2021
(In thousands)SHOPOffice
Operations
Triple-Net
Leased
Properties
Non-SegmentTotal
Revenues:Revenues:     Revenues:     
Rental incomeRental income$527,238 $— $599,696 $— $1,126,934 Rental income$— $397,843 $319,108 $— $716,951 
Resident fees and servicesResident fees and services— 1,667,421 — — 1,667,421 Resident fees and services1,064,602 — — — 1,064,602 
Office building and other services revenueOffice building and other services revenue— — 6,871 3,798 10,669 Office building and other services revenue— 4,884 — 5,447 10,331 
Income from loans and investmentsIncome from loans and investments— — — 62,203 62,203 Income from loans and investments— — — 36,675 36,675 
Interest and other incomeInterest and other income— — — 6,965 6,965 Interest and other income— — — 926 926 
Total revenuesTotal revenues$527,238 $1,667,421 $606,567 $72,966 $2,874,192 Total revenues$1,064,602 $402,727 $319,108 $43,048 $1,829,485 
Total revenuesTotal revenues$527,238 $1,667,421 $606,567 $72,966 $2,874,192 Total revenues$1,064,602 $402,727 $319,108 $43,048 $1,829,485 
Less:Less:     Less:     
Interest and other incomeInterest and other income— — — 6,965 6,965 Interest and other income— — — 926 926 
Property-level operating expensesProperty-level operating expenses17,004 1,265,362 192,192 — 1,474,558 Property-level operating expenses842,642 128,896 9,257 — 980,795 
Office building services costs— — 1,827 — 1,827 
Segment NOI$510,234 $402,059 $412,548 $66,001 1,390,842 
Office building and other services costsOffice building and other services costs— 1,276 — — 1,276 
NOINOI$221,960 $272,555 $309,851 $42,122 846,488 
Interest and other incomeInterest and other income    6,965 Interest and other income    926 
Interest expenseInterest expense    (355,333)Interest expense    (220,818)
Depreciation and amortizationDepreciation and amortization    (847,797)Depreciation and amortization    (564,848)
General, administrative and professional feesGeneral, administrative and professional fees    (100,621)General, administrative and professional fees    (70,897)
Loss on extinguishment of debt, netLoss on extinguishment of debt, net(7,386)Loss on extinguishment of debt, net(27,016)
Merger-related expenses and deal costs    (26,129)
Transaction expenses and deal costsTransaction expenses and deal costs    (5,338)
Allowance on loans receivable and investmentsAllowance on loans receivable and investments(34,654)Allowance on loans receivable and investments8,961 
OtherOther    (16,750)Other    22,918 
Loss from unconsolidated entities(15,861)
Income from unconsolidated entitiesIncome from unconsolidated entities4,517 
Gain on real estate dispositionsGain on real estate dispositions240,101 Gain on real estate dispositions43,791 
Income tax benefit    95,855 
Income tax expenseIncome tax expense    (5,794)
Income from continuing operationsIncome from continuing operations    329,232 Income from continuing operations    32,890 
Net incomeNet income329,232 Net income32,890 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests534 Net income attributable to noncontrolling interests3,708 
Net income attributable to common stockholdersNet income attributable to common stockholders$328,698 Net income attributable to common stockholders$29,182 

Capital expenditures, including investments in real estate property and development project expenditures, by reportable business segment are as follows:follows (dollars in thousands):
 For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2021202020212020
 (In thousands)
Capital expenditures:  
Triple-net leased properties$75,544 $11,832 $92,683 $33,000 
Senior living operating properties1,093,773 46,349 1,193,646 129,165 
Office properties52,627 112,432 140,841 319,834 
Total capital expenditures$1,221,944 $170,613 $1,427,170 $481,999 
 For the Three Months Ended June 30,For the Six Months Ended June 30,
Capital Expenditures:2022202120222021
SHOP$55,540 $51,156 $198,943 $99,873 
Office operations85,752 56,667 359,826 88,213 
Triple-net leased properties1,774 8,921 2,408 17,139 
Total capital expenditures$143,066 $116,744 $561,177 $205,225 
30

VENTAS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(Unaudited)

Our portfolio of properties and mortgage loan and other investments are located in the United States, Canada and the United Kingdom. Revenues are attributed to an individual country based on the location of each property. Geographic information regarding our operations is as follows:follows (dollars in thousands):
For the Three Months Ended September 30,For the Nine Months Ended September 30,
2021202020212020 For the Three Months Ended June 30,For the Six Months Ended June 30,
(In thousands)2022202120222021
Revenues:Revenues:  Revenues:
United StatesUnited States$859,524 $817,949 $2,460,534 $2,569,467 United States$903,057 $803,242 $1,800,990 $1,601,010 
CanadaCanada109,046 96,896 322,422 287,056 Canada112,809 108,342 224,953 213,375 
United KingdomUnited Kingdom7,508 4,095 22,607 17,669 United Kingdom7,072 7,610 14,549 15,100 
Total revenuesTotal revenues$976,078 $918,940 $2,805,563 $2,874,192 Total revenues$1,022,938 $919,194 $2,040,492 $1,829,485 


As of September 30, 2021As of December 31, 2020As of June 30, 2022As of December 31, 2021
(In thousands)
Net real estate property:  
Net Real Estate Property:Net Real Estate Property:
United StatesUnited States$18,545,381 $17,303,816 United States$18,581,304 $18,562,738 
CanadaCanada2,997,492 2,983,924 Canada2,927,708 3,007,008 
United KingdomUnited Kingdom249,122 262,295 United Kingdom216,771 247,092 
Total net real estate propertyTotal net real estate property$21,791,995 $20,550,035 Total net real estate property$21,725,783 $21,816,838 
31


ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Unless otherwise indicated or except where the context otherwise requires, the terms “we,” “us” and “our”“us,” “our,” “Company” and other similar terms in Item 2 of this Quarterly Report on Form 10-Q refer to Ventas, Inc. and its consolidated subsidiaries.

Cautionary Statements

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).amended. These forward-looking statements include, among others, statements of expectations, beliefs, future plans and strategies, anticipated results from operations and developments and other matters that are not historical facts. Forward-looking statements include, among other things, statements regarding our and our officers’ intent, belief or expectation as identified by the use of words such as “may,” “will,” “project,” “expect,” “believe,” “intend,” “anticipate,” “seek,” “target,” “forecast,” “plan,” “potential,” “opportunity,” “estimate,” “could,” “would,” “should” and other comparable and derivative terms or the negatives thereof. The forward-looking

Forward-looking statements are based on management’s beliefs as well as on a number of assumptions concerning future events. You should not put undue reliance on these forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties and other factors that could cause actual events or results to differ materially from those expressed or implied by the forward-looking statements. We do not undertake a duty to update these forward-looking statements, which speak only as of the date on which they are made. You are urged to carefully review the disclosures we make concerning risks and uncertainties that may affect our business and future financial performance, including those made below and in “Item 1A,our filings with the Securities and Exchange Commission, such as in the sections titled “Cautionary Statements — Summary Risk Factors,” “Risk Factors”, and “Management’s Discussion and Analysis of the Company’sFinancial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Annual Report”).2021 and “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022.

Certain factors that could affect our future results and our ability to achieve our stated goals include, but are not limited to: (a) the impact of the ongoing COVID-19 pandemic and its extended consequences, including of the Delta, Omicron or any other variant, on our revenue, level of profitability, liquidity and overall risk exposure and the implementation and impact of regulations related to the CARES Act and other stimulus legislation and any future COVID-19 relief measures; (b) our ability to achieve the anticipated benefits and synergies from, theand effectively integrate, our acquisitions and investments, including our acquisition of and the risk of greater than expected costs or other difficulties related to the integration of, New Senior Investment Group Inc.; (c) our exposure and the exposure of our tenants, borrowersmanagers and managersborrowers to complex healthcare and other regulation and the challenges and expense associated with complying with such regulation; (d) the potential for significant general and commercial claims, legal actions, regulatory proceedings or enforcement actions that could subject us or our tenants, borrowersmanagers or managersborrowers to increased operating costs and uninsured liabilities; (e) the impact of market and general economic conditions, including economic and financial market events, orinflation, changes in interest rates, supply chain pressures, events that affect consumer confidence, our occupancy rates and resident fee revenues, and the actual and perceived state of the real estate markets, labor markets and public capital markets; (f) our ability, and the ability of our tenants, borrowersmanagers and managers,borrowers, to navigate the trends impacting our or their businesses and the industries in which we or they operate; (g) the risk of bankruptcy, insolvency or financial deterioration of our tenants, managers, borrowers managers and other obligors and our ability to foreclose successfully on the collateral securing our loans and other investments in the event of a borrower default; (h) our ability to identify and consummate future investments in or dispositions of healthcare assets and effectively manage our portfolio opportunities and our investments in co-investment vehicles;vehicles, joint ventures and minority interests; (i) risks related to development, redevelopment and construction projects, including costs associated with inflation, rising interest rates, labor conditions and supply chain pressures; (j) our ability to attract and retain talented employees; (j)(k) the limitations and significant requirements imposed upon our business as a result of our status as a REIT and the adverse consequences (including the possible loss of our status as a REIT) that would result if we are not able to comply; (k)(l) the risk of changes in healthcare law or regulation or in tax laws, guidance and interpretations, particularly as applied to REITs, that could adversely affect us or our tenants, borrowersmanagers or managers; (l)borrowers; (m) increases in the Company’sour borrowing costs as a result of becoming more leveraged, or as a result of changes inrising interest rates and the phasing out of LIBOR rates; (m)(n) our reliance on third parties to operate a majority of our assets and our limited control and influence over such operations and results; (n)(o) our dependency on a limited number of tenants and managers for a significant portion of our revenues and operating income; (o)(p) the adequacy of insurance coverage provided by our policies and policies maintained by our tenants, managers or other counterparties; (p)(q) the occurrence of cyber incidents that could disrupt our operations, result in the loss of confidential information or damage our business relationships and reputation; (q)(r) the impact of merger, acquisition and investment activity in the healthcare industry or otherwise affecting our tenants, borrowersmanagers or managers;
32


borrowers; (s) disruptions to the management and (r)operations of our business and the uncertainties caused by activist investors; and (t) the risk of catastrophic or extreme weather and other natural events and the physical effects of climate change.

Many of these factors are beyond our control and the control of our management.

32


Note Regarding Third-Party Information

This Quarterly Report includes information that has been derived from SEC filings madethat has been provided to us by our publicly listed tenants and managers or been derived from SEC filings or other publicly available information or was provided to us byof our tenants and managers. We believe that such information is accurate and that the sources from which it has been obtained are reliable; however,reliable. However, we cannot guarantee the accuracy of such information and have not independently verified the assumptions on which such information is based.

Company Overview

Ventas, Inc., an S&P 500 company, is a real estate investment trust operating at the intersection of healthcare and real estate. We hold a highly diversified portfolio of senior housing communities, medical office buildings (“MOBs”), life science, research and innovation centers, hospitals and other healthcare propertiesfacilities, which we generally refer to as “healthcare real estate,” located throughout the United States, Canada and the United Kingdom. As of SeptemberJune 30, 2021,2022, we owned or had investments in approximately 1,300 properties (including properties classified as held for sale), consisting of senior housing communities, medical office buildings (“MOBs”), life science, research and innovation centers, inpatient rehabilitation facilities (“IRFs”) and long-term acute care facilities (“LTACs”), and health systems, which we generally refer to as “healthcare real estate.”. Our company was originally founded in 1983 and is headquartered in Chicago, Illinois with additional corporate offices in Louisville, Kentucky and New York, New York.

We primarily invest in a diversified portfolio of healthcare real estate assets through wholly owned subsidiaries and other co-investment entities. We operate through three reportable business segments: triple-net leased properties, senior living operations,housing operating portfolio, which we also refer to as SHOP,“SHOP” and is formerly known as senior living operations, and office operations.See our Consolidated Financial Statements and the related notes, including “Note 2 – Accounting Policies” and “Note 16 – Segment Information,” included in Item 1 of this Quarterly Report on Form 10-Q.Our senior housing propertiescommunities are either subject to triple-net leases, in which case they are included in our triple-net leased properties reportable business segment, or operated by independent third-party managers, in which case they are included in our senior living operationsSHOP reportable business segment.

As of SeptemberJune 30, 2021,2022, we leased a total of 354331 properties (excluding properties within our office operations reportable business segment) to various healthcare operating companies under triple-net or absolute-net leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures. Our three largest tenants, Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”), Ardent Health Partners, LLC (together with its subsidiaries, “Ardent”) and Kindred Healthcare, LLC (together with its subsidiaries, “Kindred”) leased from us 121 properties, 1230 properties and 3229 properties, respectively, as of SeptemberJune 30, 2021.2022.

As of SeptemberJune 30, 2021,2022, pursuant to long-term management agreements, we engaged independent operators, such as Atria Senior Living, Inc. (together with its subsidiaries, including Holiday Retirement (“Atria”Holiday”), “Atria”) and Sunrise Senior Living, LLC (together with its subsidiaries, “Sunrise”), to manage 551557 senior housing communities in our senior living operations segment for us.

Through our Lillibridge Healthcare Services, Inc. (“Lillibridge”) subsidiary and our ownership interest in PMB Real Estate Services LLC (“PMBRES”), we also provide MOB management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make secured and non-mortgage loans and other investments relating to senior housing and healthcare operators or properties.

We aim to enhance shareholder value by delivering consistent, superior total returns through a strategy of (1) generating reliable and growing cash flows, (2) maintaining a balanced, diversified portfolio of high-quality assets and (3) preserving our financial strength, flexibility and liquidity.

Our ability to access capital in a timely and cost-effective manner is critical to the success of our business strategy because it affects our ability to satisfy existing obligations, including the repayment of maturing indebtedness, and to make future investments. Factors such as general market conditions, interest rates, credit ratings on our securities, expectations of our potential future earnings and cash distributions, and the trading price of our common stock impact our access to and cost of external capital. For that reason, we generally attempt to match the long-term duration of our investments in real property with long-term financing through the issuance of shares of our common stock or the incurrence of long-term fixed rate debt.

33


2022 Highlights

Continuing Impact of and Response to COVID-19 and Its Extended Consequences

During fiscal 2020 and 2021 and continuing into fiscal 2021,2022, our business has been and continuesis expected to continue to be impacted by both the COVID-19 pandemic itself, including actions taken to prevent the spread of the virus and its variants, and the ongoing consequencesits extended consequences. The trajectory and effects of the pandemic on our business, including our senior housing business, and the broader economy. The future impact of the COVID-19 pandemic and its ongoing consequences for the U.S. economy and our business remainremains highly uncertain. The extent of the pandemic’sCOVID-19’s continuing and ultimate effect on our operational and financial performance will depend on a variety of factors, including the ultimate duration of the pandemic; the speed at which vaccines and other clinical treatments are successfully developed and deployed; the rate of acceptance of available vaccines, particularly among the residents and staff in our senior housing communities and the labor force more broadly; the impact of new variants of the virus and the effectiveness of available vaccines and other clinical treatments against those variants; ongoing clinical experience, which may differ considerably across governmental and regulatory bodies and regions and fluctuate over time; and on other future developments, including the ultimate duration, spread and intensity of the outbreak, the availability of testing, the extent to which governments impose, roll-back or re-impose preventative restrictions and the availability of ongoing government financial support to our business, tenants and operators;operators. Due to these uncertainties, we are not able at this time to estimate the ultimate impact of COVID-19 on our business, results of operations, financial condition and the slope and pace of recovery of our senior housing business and the U.S. economy more generally. The pandemic and actions taken in response to the pandemic have had broad economic consequences, including for the labor market and global supply chain, which have affected and may continue to affect our business.

2021 Highlightscash flows.

Investments and Dispositions

In September 2021,During the six months ended June 30, 2022, we completedacquired 18 MOBs leased to affiliates of Ardent, one behavioral health center and one research and innovation center, all of which are reported within our acquisition of New Senior Investment Group, Inc. (“New Senior”)office operations segment, and one senior housing community, which is reported within our SHOP segment, for aan aggregate purchase price of $2.3 billion in an all-stock transaction, which added over 100 independent living properties to our senior housing portfolio. We funded the transaction through the issuance of approximately 13.3 million shares of our common stock, the assumption of $482.5 million of New Senior mortgage debt and $1.1 billion of cash paid at closing.

In September 2021, we completed a buyout of Pacific Medical Buildings’ interest in the state-of-the-art, newly developed Sutter Van Ness Medical Office Building.

In July 2021, we received $66 million from Holiday Retirement as repayment in full of secured notes which Holiday Retirement previously issued to us as part of a lease termination transaction entered into in April 2020.

In July 2021, we received $224 million for the full redemption of Ardent’s outstanding 9.75% Senior Notes due 2026 at a price equal to 107.313% of the principal amount of the notes, plus accrued and unpaid interest. This redemption resulted in a gain of $16.6$395.3 million.

During the ninesix months ended SeptemberJune 30, 2021,2022, we sold 33 propertiesone vacant land parcel for aggregate consideration of $497.3$6.2 million and we recognized gainsa gain on the sale of these assetsthis asset of $194.1$2.4 million.

In November, we completed the approximately $180 million acquisition of six Canadian senior housing communities that will be operated under a management contract and the $58 million acquisition of a behavioral health center in Plano, Texas.

In the fourth quarter of 2021, we received proceeds of $45.0 million in full repayment of a cash pay note issued in 2020 from Brookdale Senior Living and proceeds of $22.2 million for the sale of certain real estate properties.

Liquidity and Capital

In August 2021, Ventas Realty issuedAs of June 30, 2022, we had approximately $2.5 billion in liquidity, including availability under our revolving credit facility and sold $500.0cash and cash equivalents on hand, net of $335.3 million aggregate principal amount of 2.50% senior notes due 2031 at an amount equal to 99.74% of par.borrowings outstanding under our commercial paper program.

In August 2021, Ventas Realty Limited Partnership (“Ventas Realty”) issued a make whole notice of redemption for the entirety of the $400.0 million aggregate principal amount of 3.125% senior notes due 2023, resulting in a loss on extinguishment of debt of $20.9 million for the three months ended September 30, 2021. The redemption settled in September 2021, principally using cash on hand.

In July 2021, Ventas Realty and Ventas Capital Corporation issued a make whole notice of redemption for the entirety of the $263.7 million aggregate principal amount of 3.25% senior notes dueJune 2022, resulting in a loss on extinguishment of debt of $8.2 million for the three months ended September 30, 2021. The redemption settled in August 2021, principally using cash on hand.

34


In February 2021, Ventas Realty issued a make whole notice of redemption for the entirety of the $400.0 million aggregate principal amount of 3.10% senior notes due January 2023, resulting in a loss on extinguishment of debt of $27.3 million for the three months ended March 31, 2021. The redemption settled in March 2021, principally using cash on hand.

In January 2021, we entered into ana Credit and Guaranty Agreement (the “New Credit Agreement”) with Ventas Realty, as borrower. The New Credit Agreement replaces Ventas Realty’s previous $200.0 million unsecured credit facility comprised of a $2.75 billion unsecured revolving credit facilityterm loan priced at LIBOR plus 0.825%, which replaced our previous $3.0 billion0.90% that matured in 2023 with a new $500.0 million unsecured revolving credit facilityterm loan that matures in 2027 and is initially priced at 0.875%. The new unsecured revolving credit facility matures in January 2025, but may be extended at our option, subject to the satisfaction of certain conditions, for an additional year. The unsecured revolving credit facility also includes an accordion feature that permits us to increase our aggregate borrowing capacity thereunder to up to $3.75 billion, subject to the satisfaction of certain conditions.

During the three months ended September 30, 2021, we sold 10.6 million shares of our common stock under our “at-the-market” equity offering program (“ATM program”) for gross proceeds of $611.7 million, representing an average price of $57.73 per share. During the nine months ended September 30, 2021, we sold 10.9 million shares of our common stock under our ATM program for gross proceeds of $626.4 million, representing an average price of $57.71 per share. Term SOFR plus 0.95% based on Ventas Realty’s debt ratings.

Other Items

In March 2021, the Ventas Life Science and Healthcare Real Estate Fund, L.P. (the “Ventas Fund”) acquired two Class-A life science properties in the Baltimore-DC life science cluster for $272 million, which increased the Ventas Fund’s assets under management to $2.1 billion.

InDuring the first quarter of 2021,and subsequent to the second quarter of 2022, we received $13.6$34.0 million and $20.2 million, respectively, in grants in connection with our PhasePhases 3 and 4 applications to the Provider Relief Fund administered by the U.S. Department of Health & Human Services (“HHS”) on behalf of the assisted living communities in our senior living operationsSHOP segment to partially mitigate losses attributable to COVID-19.

During the nine months ended September 30, 2021, we recognized $9.9 million of expenses relating to natural disaster events.

3534


Concentration Risk

We use concentration ratios to identify, understand and evaluate the potential impact of economic downturns and other adverse events that may affect our asset types, geographic locations, business models, and tenants, operators and managers. We evaluate concentration risk in terms of investment mix and operations mix. Investment mix measures the percentage of our investments that is concentrated in a specific asset type or that is operated or managed by a particular tenant, operator or manager. Operations mix measures the percentage of our operating results that is attributed to a particular tenant, operator or manager, geographic location or business model. The following tables reflect our concentration risk as of the dates and for the periods presented:
As of September 30, 2021As of December 31, 2020
Investment mix by asset type (1):
  
Senior housing communities66.7 %63.5 %
MOBs17.5 19.7 
Life science, research and innovation centers6.9 7.1 
Health systems5.0 5.2 
IRFs and LTACs1.6 1.7 
Skilled nursing facilities (“SNFs”)0.6 0.7 
Secured loans receivable and investments, net1.7 2.1 
Investment mix by tenant, operator and manager (1):
  
Atria19.9 %20.8 %
Sunrise10.0 10.4 
Brookdale Senior Living7.9 8.2 
Ardent4.7 4.9 
Kindred1.0 1.1 
All other56.5 54.6 

            The following tables reflect our concentration risk as of the dates and for the periods presented:
As of June 30, 2022As of December 31, 2021
Investment mix by asset type (1):
  
Senior housing communities66.6 %67.4 %
MOBs17.8 17.1 
Life science, research and innovation centers6.9 6.7 
Health systems4.9 5.0 
Inpatient rehabilitation facilities (“IRFs”) and long-term acute care facilities (“LTACs”)1.5 1.5 
Skilled nursing facilities (“SNFs”)0.6 0.6 
Secured loans receivable and investments, net1.7 1.7 
Total100.0 %100.0 %
Investment mix by tenant, operator and manager (1):
  
Atria (2)
26.7 %27.0 %
Sunrise9.8 10.0 
Brookdale Senior Living7.7 7.8 
Le Groupe Maurice7.2 7.3 
Ardent5.3 4.7 
Kindred0.8 1.0 
All other42.5 42.2 
Total100.0 %100.0 %

(1)Ratios are based on the gross book value of consolidated real estate investments (excluding properties classified as held for sale) as of each reporting date.

(2)
Includes assets managed by Holiday, which was acquired by Atria in July 2021.

3635


For the Three Months Ended September 30,For the Nine Months Ended September 30, For the Three Months Ended June 30,For the Six Months Ended June 30,
2021202020212020 2022202120222021
Operations mix by tenant and operator and business model:Operations mix by tenant and operator and business model:  Operations mix by tenant and operator and business model:  
Revenues (1):
Revenues (1):
  
Revenues (1):
  
Senior living operations57.2 %59.1 %58.0 %58.1 %
SHOPSHOP64.3 %58.5 %64.2 %58.4 %
Brookdale Senior Living (2)
Brookdale Senior Living (2)
3.8 4.0 4.0 4.5 
Brookdale Senior Living (2)
3.6 4.1 3.6 4.1 
KindredKindred3.3 3.4 3.3 3.4 
ArdentArdent3.3 3.3 3.4 3.2 Ardent3.2 3.6 3.2 3.6 
All othersAll others25.6 30.4 25.7 30.5 
TotalTotal100.0 %100.0 %100.0 %100.0 %
Net operating income (“NOI”):Net operating income (“NOI”):
SHOPSHOP33.8 %26.6 %35.5 %26.6 %
Brookdale Senior Living (2)
Brookdale Senior Living (2)
8.4 8.8 8.1 8.8 
KindredKindred3.5 3.6 3.6 3.4 Kindred7.6 7.4 7.3 7.4 
ArdentArdent7.3 7.9 7.0 7.9 
All othersAll others32.2 30.0 31.0 30.8 All others42.9 49.3 42.1 49.3 
Adjusted EBITDA: 
Senior living operations25.2 %28.6 %26.5 %29.9 %
Brookdale Senior Living (2)
9.2 8.9 9.1 9.6 
Ardent7.8 7.4 7.8 6.8 
Kindred8.3 7.9 8.2 7.3 
All others49.5 47.2 48.4 46.4 
Net operating income (“NOI”):
Senior living operations23.2 %28.4 %25.4 %29.1 %
Brookdale Senior Living (2)
8.2 8.8 8.6 9.3 
Ardent7.1 7.2 7.3 6.5 
Kindred7.5 7.8 7.7 7.1 
All others54.0 47.8 51.0 48.0 
TotalTotal100.0 %100.0 %100.0 %100.0 %
Operations mix by geographic location (3):
Operations mix by geographic location (3):
 
Operations mix by geographic location (3):
 
CaliforniaCalifornia14.5 %15.8 %15.0 %15.7 %California14.4 %15.2 %14.4 %15.3 %
New YorkNew York7.5 8.0 7.7 8.2 New York7.5 7.7 7.4 7.7 
TexasTexas5.9 6.0 6.0 6.1 Texas6.7 6.0 6.6 6.0 
PennsylvaniaPennsylvania4.5 4.2 4.6 4.6 Pennsylvania5.2 4.6 5.1 4.6 
North CarolinaNorth Carolina3.9 4.0 4.0 4.1 North Carolina4.3 3.9 4.5 3.8 
All othersAll others63.7 61.9 62.8 61.2 All others61.9 62.6 62.0 62.6 
TotalTotal100.0 %100.0 %100.0 %100.0 %

(1)Total revenues include office building and other services revenue, revenue from loans and investments and interest and other income (including amounts related to assets classified as held for sale).
(2)Results exclude eight senior housing communities which are included in the senior living operationsSHOP reportable business segment.
(3)Ratios are based on total revenues (including amounts related to assets classified as held for sale) for each period presented.

See “Non-GAAP Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure and reconciliations of net income attributable to common stockholders, as computed in accordance with GAAP, to Adjusted EBITDA and NOI, respectively.NOI.

Triple-Net Lease Performance and Expirations

Although our lease expirations are staggered, the non-renewal of some or all of our triple-net leases that expire in any given year could have a material adverse effect on us. During the ninesix months ended SeptemberJune 30, 2021,2022, we had no triple-net lease renewals or expirations without renewal that, in the aggregate, had a material impact on our financial condition or results of operations for that period.

3736


Critical Accounting Policies and Estimates

Our Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”), and with the SEC instructions to Form 10-Q and Article 10 of Regulation S-X. GAAP requires us to make estimates and assumptions regarding future events that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We base these estimates on our experience and assumptions we believe to be reasonable under the circumstances. However, if our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, we may have applied a different accounting treatment, resulting in a different presentation of our financial statements. We periodically reevaluate our estimates and assumptions, and in the event they prove to be different from actual results, we make adjustments in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain.

Our 20202021 Annual Report contains additional information regarding the critical accounting policies that affect our more significant estimates and judgments used in the preparation of our Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. There have been no material changes to these policies in 2021.2022. Please refer to “Note 2 – Accounting Policies” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for information regarding recently adopted accounting standards.
    
Results of Operations

As of SeptemberJune 30, 2021,2022, we operated through three reportable business segments: triple-net leased properties, senior living operationsSHOP and office operations. In our triple-net leased properties reportable business segment, we invest in and own senior housing and healthcare properties throughout the United States and the United Kingdom and lease those properties to healthcare operating companies under “triple-net” or “absolute-net” leases that obligate the tenants to pay all property-related expenses. In our senior living operationsSHOP reportable business segment, we invest in senior housing communities throughout the United States and Canada and engage independent operators, such as Atria and Sunrise, to manage those communities. In our office operations reportable business segment, we primarily acquire, own, develop, lease and manage MOBs and life science, research and innovation centers throughout the United States. Information provided for “all other”“non-segment” includes income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to any of our three reportable business segments. Assets included in “all other”“non-segment” consist primarily of corporate assets, including cash, restricted cash, loans receivable and investments, and miscellaneous accounts receivable.

Our chief operating decision makers evaluate performance of the combined properties in each reportable business segment and determine how to allocate resources to those segments, in significant part, based on segment NOInet operating income (“NOI”) and related measures. For further information regarding our reportable business segments and a discussion of our definition of segment NOI, see “Note 16 – Segment Information” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. See “Non-GAAP Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure and reconciliations of net income attributable to common stockholders, as computed in accordance with GAAP, to NOI.

3837


Three Months Ended SeptemberJune 30, 20212022 and 20202021

The table below shows our results of operations for the three months ended SeptemberJune 30, 20212022 and 20202021 and the effect of changes in those results from period to period on our net income attributable to common stockholders.stockholders (dollars in thousands):
 For the Three Months Ended September 30,Increase (Decrease)
to Net Income
 20212020$%
 (Dollars in thousands)
Segment NOI:    
Triple-net leased properties$178,111 $150,738 $27,373 18.2 %
Senior living operations104,380 118,669 (14,289)(12.0)
Office operations137,622 133,325 4,297 3.2 
All other31,698 20,094 11,604 57.7 
Total segment NOI451,811 422,826 28,985 6.9 
Interest and other income417 572 (155)(27.1)
Interest expense(108,816)(115,505)6,689 5.8 
Depreciation and amortization(313,596)(249,366)(64,230)(25.8)
General, administrative and professional fees(30,259)(32,081)1,822 5.7 
Loss on extinguishment of debt, net(29,792)(7,386)(22,406)nm
Merger-related expenses and deal costs(22,662)(11,325)(11,337)nm
Allowance on loans receivable and investments60 (4,999)5,059 nm
Other(33,673)(5,681)(27,992)nm
Loss before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(86,510)(2,945)(83,565)nm
Income from unconsolidated entities2,772 865 1,907 nm
Gain on real estate dispositions150,292 12,622 137,670 nm
Income tax (expense) benefit(3,780)3,195 (6,975)nm
Income from continuing operations62,774 13,737 49,037 nm
Net income62,774 13,737 49,037 nm
Net income attributable to noncontrolling interests2,094 986 (1,108)nm
Net income attributable to common stockholders$60,680 $12,751 47,929 nm
 For the Three Months Ended June 30,Increase (Decrease)
to Net Income
 20222021$%
NOI:    
SHOP$150,610 $111,139 $39,471 35.5 %
Office operations136,583 137,320 (737)(0.5)
Triple-net leased properties145,812 154,791 (8,979)(5.8)
Non-segment12,998 20,506 (7,508)(36.6)
Total NOI446,003 423,756 22,247 5.2 
Interest and other income1,166 585 581 99.3 
Interest expense(113,951)(110,051)(3,900)(3.5)
Depreciation and amortization(283,075)(250,700)(32,375)(12.9)
General, administrative and professional fees(32,915)(30,588)(2,327)(7.6)
(Loss) gain on extinguishment of debt, net(7)74 (81)(109.5)
Transaction expenses and deal costs(13,078)(721)(12,357)nm
Allowance on loans receivable and investments62 59 5.1 
Other(48,116)13,490 (61,606)nm
(Loss) income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(43,911)45,904 (89,815)nm
(Loss) income from unconsolidated entities(1,047)4,767 (5,814)(122.0)
(Loss) gain on real estate dispositions(34)41,258 (41,292)(100.1)
Income tax benefit (expense)3,790 (3,641)7,431 nm
(Loss) income from continuing operations(41,202)88,288 (129,490)(146.7)
Net (loss) income(41,202)88,288 (129,490)(146.7)
Net income attributable to noncontrolling interests1,214 1,897 683 36.0 
Net (loss) income attributable to common stockholders$(42,416)$86,391 $(128,807)(149.1)

nm - not meaningful

Segment NOI—Senior Housing Operating Portfolio

The following table summarizes results of operations in our SHOP reportable business segment, including assets sold or classified as held for sale as of June 30, 2022 (dollars in thousands):
 For the Three Months Ended June 30, Increase (Decrease) to NOI
 20222021$%
NOI—SHOP:    
Resident fees and services$658,056 $535,952 $122,104 22.8 %
Less: Property-level operating expenses(507,446)(424,813)(82,633)(19.5)
NOI$150,610 $111,139 $39,471 35.5 

38


Number of Properties at June 30,Average Unit Occupancy for the Three Months Ended June 30,Average Monthly Revenue Per Occupied Room For the Three Months Ended June 30,
 202220212022202120222021
Total communities548 440 80.4 %77.4 %$4,391 $4,635 

Resident fees and services include all amounts earned from residents at our senior housing communities, such as rental fees related to resident leases, extended health care fees and other ancillary service income. Property-level operating expenses related to our SHOP reportable business segment include labor, food, utilities, marketing, management and other costs of operating the properties. For senior housing communities in our SHOP reportable business segment, occupancy generally reflects average operator-reported unit occupancy for the reporting period. Average monthly revenue per occupied room reflects average resident fees and services per operator-reported occupied unit for the reporting period.

The NOI increase in our SHOP reportable business segment for the three months ended June 30, 2022 compared to the same period in 2021 was driven by acquisitions, primarily the acquisition of over 100 independent living communities from New Senior in September 2021 as well as an overall increase in occupancy and revenue per occupied room, partially offset by higher operating expenses, driven by macro inflationary impacts on labor, utilities and other operating expenses.

The following table compares results of operations for our 321 same-store SHOP communities (dollars in thousands). See “Non-GAAP Financial MeasuresNOI” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure regarding same-store NOI for each of our reportable business segments.
 For the Three Months Ended June 30,Increase (Decrease) to NOI
 20222021$%
Same-Store NOI—SHOP:    
Resident fees and services$485,098 $440,397 $44,701 10.2 %
Less: Property-level operating expenses(366,635)(331,445)(35,190)(10.6)
NOI$118,463 $108,952 $9,511 8.7 

 Number of Properties at June 30,Average Unit Occupancy for the Three Months Ended June 30,Average Monthly Revenue Per Occupied Room For the Three Months Ended June 30,
 202220212022202120222021
Same-store communities321 321 83.7 %79.8 %$4,825 $4,594 

The NOI increase in our same-store SHOP reportable business segment for the three months ended June 30, 2022 compared to the same period in 2021 was primarily driven by an increase in occupancy and revenue per occupied room, partially offset by higher operating expenses, driven by macro inflationary impacts on labor, utilities and other operating expenses.

39


NOI—Office Operations

The following table summarizes results of operations in our office operations reportable business segment, including assets sold or classified as held for sale as of June 30, 2022 (dollars in thousands). For properties in our office operations reportable business segment, occupancy generally reflects occupied square footage divided by net rentable square footage as of the end of the reporting period.
For the Three Months Ended June 30,(Decrease) Increase to NOI
 20222021$%
NOI—Office Operations:    
Rental income$199,241 $200,388 $(1,147)(0.6)%
Office building and other services revenue670 2,540 (1,870)(73.6)
Total revenues199,911 202,928 (3,017)(1.5)
Less:
Property-level operating expenses(63,328)(64,950)1,622 2.5 
Office building and other services costs— (658)658 100.0 
NOI$136,583 $137,320 $(737)(0.5)

Number of Properties at June 30, Occupancy at June 30,Annualized Average Rent Per Occupied Square Foot for the Three Months Ended June 30,
 202220212022202120222021
Total office buildings362 370 89.5 %89.5 %$36 $34 

The NOI decrease in office operations reportable business segment for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to dispositions of non-core assets during 2021, partially offset by successful new leasing, sustained tenant retention, improved parking income and acquisitions subsequent to June 30, 2021.

The following table compares results of operations for our 331 same-store office buildings (dollars in thousands):
 For the Three Months Ended June 30,Increase (Decrease) to NOI
 20222021$%
Same-Store NOI—Office Operations:    
Rental income$185,908 $180,049 $5,859 3.3 %
Less: Property-level operating expenses(58,953)(57,107)(1,846)(3.2)
NOI$126,955 $122,942 $4,013 3.3 

Number of Properties at June 30,Occupancy at June 30,Annualized Average Rent Per Occupied Square Foot for the Three Months Ended June 30,
 202220212022202120222021
Same-store office buildings331 331 91.6 %91.3 %$36 $35 

The NOI increase in our same-store office operations reportable business segment for the three months ended June 30, 2022 compared to the same period in 2021 was primarily driven by strong retention, new leasing and favorable expense controls.

40


NOI—Triple-Net Leased Properties

The following table summarizes results of operations in our triple-net leased properties reportable business segment, including assets sold or classified as held for sale as of SeptemberJune 30, 2021.2022 (dollars in thousands):
For the Three Months Ended September 30,Increase
to Segment NOI
For the Three Months Ended June 30,(Decrease) Increase to NOI
20212020$% 20222021$%
(Dollars in thousands)
Segment NOI—Triple-Net Leased Properties:    
NOI—Triple-Net Leased Properties:NOI—Triple-Net Leased Properties:    
Rental incomeRental income$181,379 $156,136 $25,243 16.2 %Rental income$149,397 $159,223 $(9,826)(6.2)%
Less: Property-level operating expensesLess: Property-level operating expenses(3,268)(5,398)2,130 39.5 Less: Property-level operating expenses(3,585)(4,432)847 19.1 
Segment NOI$178,111 $150,738 27,373 18.2 
NOINOI$145,812 $154,791 $(8,979)(5.8)

In our triple-net leased properties reportable business segment, our revenues generally consist of fixed rental amounts (subject to annual contractual escalations) received from our tenants in accordance with the applicable lease terms. We report revenues and property-level operating expenses within our triple-net leased properties reportable business segment for real estate tax and insurance expenses that are paid from escrows collected from our tenants.
39



The segment NOI increasedecrease in our triple-net leased portfolioproperties for the three months ended June 30, 2022 compared to the same period in 2021 was primarily driven by the $22.3 million non-cash impact of a lease termination in connection with a transition to a new operator under a management contract during the third quarter of 2021 and $14.3 million of COVID-19 related write-offs of previously accrued straight-line rental income during the third quarter of 2020, partially offset by $9.0 million attributable to rental income from communities that were sold or transitioned to our senior housing operating portfolio beforeor sold prior to the thirdsecond quarter of 2021.2022.

Occupancy rates may affect the profitability of our tenants’ operations. For senior housing communities and post-acute properties in our triple-net leased properties reportable business segment, occupancy generally reflects average operator-reported unit and bed occupancy, respectively, for the reporting period. Because triple-net financials are delivered to us following the reporting period, occupancy is reported in arrears. The following table sets forth average continuing occupancy rates for the first quarter of 2022 and 2021 related to the triple-net leased properties we owned at SeptemberJune 30, 20212022 and 2020 for the second quarter of 2021, and 2020, respectively. The table excludes non-stabilized properties, properties owned through investments in unconsolidated real estate entities, certain properties for which we do not receive occupancy information and properties acquired or properties that transitioned operators for which we do not have a full quarter of occupancy results.

Number of Properties Owned at September 30, 2021Average Occupancy for the Three Months Ended June 30, 2021Number of Properties Owned at September 30, 2020Average Occupancy for the Three Months Ended June 30, 2020Number of Properties Owned at June 30, 2022Average Occupancy for the Three Months Ended March 31, 2022Number of Properties Owned at June 30, 2021Average Occupancy for the Three Months Ended March 31, 2021
Senior housing communitiesSenior housing communities26874.5%30380.6%Senior housing communities26074.9%28176.0%
SNFsSNFs1675.21678.9SNFs1680.71675.8
IRFs and LTACsIRFs and LTACs3659.33556.9IRFs and LTACs3658.13559.0

Declines in occupancy are primarily the result of COVID-19 impacts.

The following table compares results of operations for our 338330 same-store triple-net leased properties. See “Non-GAAP Financial MeasuresNOI” included elsewhereproperties (dollars in this Quarterly Report on Form 10-Q for additional disclosure regarding same-store NOI for each of our reportable business segments.thousands):
For the Three Months Ended September 30,Increase to Segment NOI For the Three Months Ended June 30,(Decrease) Increase to NOI
20212020$% 20222021$%
(Dollars in thousands)
Same-Store Segment NOI—Triple-Net Leased Properties:    
Same-Store NOI—Triple-Net Leased Properties:Same-Store NOI—Triple-Net Leased Properties:    
Rental incomeRental income$151,321 $139,155 $12,166 8.7 %Rental income$147,406 $148,238 $(832)(0.6)%
Less: Property-level operating expensesLess: Property-level operating expenses(3,008)(3,876)868 22.4 Less: Property-level operating expenses(3,355)(3,427)72 2.1 
Segment NOI$148,313 $135,279 13,034 9.6 
NOINOI$144,051 $144,811 $(760)(0.5)

The segmentdecrease in NOI increase in our same-store triple nettriple-net leased portfolio for the three months ended June 30, 2022 compared to the same period in 2021 was primarily driven by $14.3lease resolutions after June 30, 2021 with several smaller senior housing triple-net tenants who were materially affected by COVID-19.

41


NOI—Non-Segment

Information provided for non-segment NOI includes income from loans and investments and other miscellaneous income not directly attributable to any of our three reportable business segments. The $7.5 million decrease in non-segment NOI for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to reduced interest income from a lower balance of loans receivable investments due to the redemption of Ardent’s senior notes and payoff of certain notes in 2021.

Company Results

Interest Expense

The $3.9 million increase in interest expense for the three months ended June 30, 2022 compared to the same period in 2021 was due to an increase of $4.9 million as a result of higher debt balances, offset by a decrease of $1.3 million due to a lower effective interest rate. Our weighted average effective interest rate was 3.54% and 3.58% for the three months ended June 30, 2022 and 2021, respectively. Capitalized interest was $2.7 million for both the three months ended June 30, 2022 and 2021.

Depreciation and Amortization

The $32.4 million increase in depreciation and amortization expense for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to $41.8 million of COVID-19 related write-offsdepreciation on assets acquired from New Senior, partially offset by a net decrease in impairments recognized in the second quarter of previously accrued straight-line rental income2022 as compared to the same period in 2021.
General, Administrative and Professional Fees

The $2.3 million increase in general, administrative and professional fees for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to the return to a more normalized business environment and the inclusion of a portion of New Senior’s overhead.

(Loss) Gain on Extinguishment of Debt, Net

Loss on extinguishment of debt, net was relatively flat for the three months ended June 30, 2022 compared to the same period in 2021.

Transaction Expenses and Deal Costs

The $12.4 million increase in transaction expenses and deal costs for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to costs incurred in connection with stockholder relations matters.

Allowance on Loans Receivable and Investments

Allowance on loans receivable and investments was relatively flat for the three months ended June 30, 2022 compared to the same period in 2021.

Other

The $61.6 million increase in other expense for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to an increase of $61.1 million in unrealized loss on stock warrants received in connection with the Brookdale Senior Living lease modification in the third quarter of 2020. As of June 30, 2022, the fair value of the stock warrants was $39.6 million, which was $11.5 million higher than the value at the grant date.

Segment Loss (Income) from Unconsolidated Entities

The $5.8 million increase in loss from unconsolidated entities for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to our share of increased net loss from our unconsolidated entities.

42


(Loss) Gain on Real Estate Dispositions

The $41.3 million decrease in gain on real estate dispositions for the three months ended June 30, 2022 compared to the same period in 2021 was primarily due to the second quarter 2021 sale of one MOB for a gain of $41.3 million.

Income Tax Benefit (Expense)

The $3.8 million of income tax benefit for the three months ended June 30, 2022 was primarily due to operating losses at certain of our TRS entities and a net benefit for the unwind of certain tax credit structure during the first quarter of 2022. The $3.6 million of income tax expense for the three months ended June 30, 2021 was primarily due to a $2.8 million net deferred tax expense related to an internal restructuring of certain U.S. taxable REIT subsidiaries, and a $3.4 million deferred tax expense related to the revaluation of certain deferred tax liabilities as a result of enacted tax rate changes in the United Kingdom.

Six Months Ended June 30, 2022 and 2021

The table below shows our results of operations for the six months ended June 30, 2022 and 2021 and the effect of changes in those results from period to period on our net income attributable to common stockholders (dollars in thousands):
For the Six Months Ended June 30,Increase (Decrease)
to Net Income
 20222021$%
NOI:    
SHOP$326,201 $221,960 $104,241 47.0 %
Office operations274,557 272,555 2,002 0.7 
Triple-net leased properties293,365 309,851 (16,486)(5.3)
Non-segment24,864 42,122 (17,258)(41.0)
Total NOI918,987 846,488 72,499 8.6 
Interest and other income1,702 926 776 83.8 
Interest expense(224,745)(220,818)(3,927)(1.8)
Depreciation and amortization(572,139)(564,848)(7,291)(1.3)
General, administrative and professional fees(75,913)(70,897)(5,016)(7.1)
Loss on extinguishment of debt, net(7)(27,016)27,009 100.0 
Transaction expenses and deal costs(33,070)(5,338)(27,732)nm
Allowance on loans receivable and investments116 8,961 (8,845)(98.7)
Other(20,926)22,918 (43,844)nm
Loss before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(5,995)(9,624)3,629 37.7 
(Loss) income from unconsolidated entities(5,316)4,517 (9,833)nm
Gain on real estate dispositions2,421 43,791 (41,370)(94.5)
Income tax benefit (expense)8,280 (5,794)14,074 nm
(Loss) income from continuing operations(610)32,890 (33,500)(101.9)
Net (loss) income(610)32,890 (33,500)(101.9)
Net income attributable to noncontrolling interests3,074 3,708 634 17.1 
Net (loss) income attributable to common stockholders$(3,684)$29,182 $(32,866)(112.6)

nm - not meaningful

43


NOI—Senior Living OperationsHousing Operating Portfolio

The following table summarizes results of operations in our senior living operationsSHOP reportable business segment, including assets sold or classified as held for sale as of SeptemberJune 30, 2021. For senior housing communities2022 (dollars in thousands):
 For the Six Months Ended June 30,Increase (Decrease) to NOI
 20222021$%
NOI—SHOP:    
Resident fees and services$1,309,177 $1,064,602 $244,575 23.0 %
Less: Property-level operating expenses(982,976)(842,642)(140,334)(16.7)
NOI$326,201 $221,960 $104,241 47.0 
Number of Properties at June 30,Average Unit Occupancy For the Six Months Ended June 30, Average Monthly Revenue Per Occupied Room For the Six Months Ended June 30,
 202220212022202120222021
Total communities548 440 80.2 %76.8 %$4,382 $4,642 
The NOI increase in our senior living operationsSHOP reportable business segment occupancy generally reflects average operator-reported unit occupancy for the reporting period.
 For the Three Months Ended September 30, Increase (Decrease)
to Segment NOI
 20212020$%
 (Dollars in thousands)
Segment NOI—Senior Living Operations:    
Resident fees and services$558,039 $541,322 $16,717 3.1 %
Less: Property-level operating expenses(453,659)(422,653)(31,006)(7.3)
Segment NOI$104,380 $118,669 (14,289)(12.0)

40


Number of Properties at September 30,Average Unit Occupancy for the Three Months Ended September 30,Average Monthly Revenue Per Occupied Room For the Three Months Ended September 30,
 202120202021202020212020
Total communities542 431 79.6 %79.8 %$4,556 $4,708 

Resident fees and services include all amounts earned from residents at our senior housing communities, such as rental fees relatedsix months ended June 30, 2022 compared to resident leases, extended health care fees and other ancillary service income. Average monthly revenue per occupied room reflects average resident fees and services per operator-reported occupied unit for the reporting period. Property-level operating expenses related to our senior living operations segment include labor, food, utilities, marketing, management and other costs of operating the properties.

Thesame period over period segment NOI decrease in our senior living operating portfolio2021 was primarily driven by loweracquisitions, primarily the acquisition of over 100 independent living communities from New Senior in September 2021, an overall increase in occupancy and revenue per occupied roomhigher HHS grants received, which are reflected as a reduction in property-level operating expenses. During the first quarter of 2022 and higher2021, HHS grants received reduced property-level operating expenses principally labor costs, partially offset by lower COVID-19 related costs in 2021, the transition of assets from our triple-net portfolio to our senior living operating portfolio$32.8 million and development properties placed in service.$13.6 million, respectively.

The following table compares results of operations for our 306320 same-store senior living operating communities.SHOP communities (dollars in thousands):
For the Three Months Ended September 30,Decrease
to Segment NOI
For the Six Months Ended June 30,Increase (Decrease) to NOI
20212020$% 20222021$%
(Dollars in thousands)
Same-Store Segment NOI—Senior Living Operations:    
Same-Store NOI—SHOP:Same-Store NOI—SHOP:    
Resident fees and servicesResident fees and services$439,728 $444,029 $(4,301)(1.0)%Resident fees and services$960,473 $873,408 $87,065 10.0 %
Less: Property-level operating expensesLess: Property-level operating expenses(337,314)(326,767)(10,547)(3.2)Less: Property-level operating expenses(709,105)(659,016)(50,089)(7.6)
Segment NOI$102,414 $117,262 (14,848)(12.7)
NOINOI$251,368 $214,392 $36,976 17.2 

 Number of Properties at September 30,Average Unit Occupancy for the Three Months Ended September 30,Average Monthly Revenue Per Occupied Room For the Three Months Ended September 30,
 202120202021202020212020
Same-store communities306 306 82.6 %82.0 %$4,683 $4,760 
 Number of Properties at June 30,Average Unit Occupancy For the Six Months Ended June 30, Average Monthly Revenue Per Occupied Room For the Six Months Ended June 30,
 202220212022202120222021
Same-store communities320 320 83.2 %79.2 %$4,851 $4,636 

The period over period segment NOI decreaseincrease in our same-store senior living operating portfolioSHOP reportable business segment for the six months ended June 30, 2022 compared to the same period in 2021 was primarily driven by loweran increase in occupancy and revenue per occupied room andpartially offset by higher operating expenses, principallydriven by macro inflationary impacts on labor, costs, partially offsetutilities and other operating expenses. During the first quarter of 2022 and 2021, HHS grants received reduced property-level operating expenses by lower COVID-19 related costs in 2021.

$21.1 million and $7.6 million, respectively.
4144



Segment NOI—Office Operations

The following table summarizes results of operations in our office operations reportable business segment, including assets sold or classified as held for sale as of SeptemberJune 30, 2021. For properties2022 (dollars in thousands):
 For the Six Months Ended June 30,Increase (Decrease) to NOI
 20222021$%
NOI—Office Operations:    
Rental income$399,781 $397,843 $1,938 0.5 %
Office building and other services revenue1,287 4,884 (3,597)(73.6)
Total revenues401,068 402,727 (1,659)(0.4)
Less:
Property-level operating expenses(126,511)(128,896)2,385 1.9 
Office building and other services costs— (1,276)1,276 100.0 
NOI$274,557 $272,555 $2,002 0.7 
 Number of Properties at June 30,Occupancy at June 30,Annualized Average Rent Per Occupied Square Foot For the Six Months Ended June 30,
 202220212022202120222021
Total office buildings362 370 89.5 %89.5 %$36 $34 
The NOI increase in our office operations reportable business segment occupancy generally reflects occupied square footage divided by net rentable square footage as of the end of the reporting period.
For the Three Months Ended September 30,Increase
to Segment NOI
 20212020$%
 (Dollars in thousands)
Segment NOI—Office Operations:    
Rental income$201,673 $198,376 $3,297 1.7 %
Office building services revenues2,872 2,440 432 17.7 
Total revenues204,545 200,816 3,729 1.9 
Less:
Property-level operating expenses(66,401)(66,934)533 0.8 
Office building services costs(522)(557)35 6.3 
Segment NOI$137,622 $133,325 4,297 3.2 

Number of Properties at September 30, Occupancy at September 30,Annualized Average Rent Per Occupied Square Foot for the Three Months Ended September 30,
 202120202021202020212020
Total office buildings348 377 90.5 %89.9 %$35 $34 

The increase in office segment NOI for the threesix months ended SeptemberJune 30, 20212022 compared to the same period in 20202021 was primarily due to contractual rent increases,driven by strong retention, new leasing sustained retention and improved parking revenues, partially offset by dispositions of non-core assets during the three months ended September 30, 2021.favorable expense controls.

The following table compares results of operations for our 335331 same-store office buildings.buildings (dollars in thousands):
For the Three Months Ended September 30,Increase (Decrease)
to Segment NOI
For the Six Months Ended June 30,Increase (Decrease) to NOI
20212020$% 20222021$%
(Dollars in thousands)
Same-Store Segment NOI—Office Operations:    
Same-Store NOI—Office Operations:Same-Store NOI—Office Operations:    
Rental incomeRental income$189,296 $177,665 $11,631 6.5 %Rental income$373,489 $358,382 $15,107 4.2 %
Less: Property-level operating expensesLess: Property-level operating expenses(59,681)(59,175)(506)(0.9)Less: Property-level operating expenses(118,192)(113,277)(4,915)(4.3)
Segment NOI$129,615 $118,490 11,125 9.4 
NOINOI$255,297 $245,105 $10,192 4.2 

Number of Properties at September 30,Occupancy at September 30,Annualized Average Rent Per Occupied Square Foot for the Three Months Ended September 30,
 202120202021202020212020
Same-store office buildings335 335 92.0 %91.9 %$35 $34 
Number of Properties at June 30,Occupancy at June 30,Annualized Average Rent Per Occupied Square Foot For the Six Months Ended June 30,
 202220212022202120222021
Same-store office buildings331 331 91.6 %91.3 %$36 $35 
The NOI increase in our same-store office operations reportable business segment for the six months ended June 30, 2022 compared to the same period in 2021 was primarily due to strong retention, new leasing and favorable expense controls.

4245



The increase in our same-store office operations segment NOI for the three months ended September 30, 2021 over the same period in 2020 was primarily due to contractual rent escalators, new leasing, sustained tenant retention and improved parking income.

Segment NOI —All Other

Information provided for all other segment NOI includes income from loans and investments and other miscellaneous income not directly attributable to any of our three reportable business segments. The $11.6 million increase in all other segment NOI for the three months ended September 30, 2021 over the same period in 2020 was primarily due to the $16.6 million gain recognized in the third quarter of 2021 for the redemption of Ardent’s outstanding 9.75% Senior Notes due 2026 and increased management fee revenues from investments in unconsolidated real estate entities, partially offset by reduced interest income from a lower balance of loans receivable investments.

Company Results

Interest and Other Income

The $0.2 million decrease in interest and other income for the three months ended September 30, 2021 was primarily due to lower interest income on short-term investments.

Interest Expense

The $6.7 million decrease in interest expense for the three months ended September 30, 2021 compared to the same period in 2020 was primarily attributable to lower debt balances. Our weighted average effective interest rate was 3.6% for both the three months ended September 30, 2021 and 2020. Capitalized interest for the three months ended September 30, 2021 and 2020 was $2.7 million and $2.5 million, respectively.

Depreciation and Amortization

The $64.2 million increase in depreciation and amortization expense was primarily due to impairments recognized in the third quarter of 2021 related to properties sold or classified as held for sale.
General, Administrative and Professional Fees

The $1.8 million decrease in general, administrative and professional fees was primarily due to lower professional fees offset by increased compensation and benefits.

Loss on Extinguishment of Debt

The $22.4 million increase in loss on extinguishment of debt is primarily related to the $29.1 million loss recognized during the third quarter of 2021 for the redemptions of $400.0 million aggregate principal amount of 3.125% senior notes due 2023 and $263.7 million aggregate principal amount of 3.25% senior notes due 2022, partially offset by the $7.4 million non-cash loss recognized in the third quarter of 2020 for the redemption of $236.3 million aggregate principal amount of 3.25% senior notes due 2022.

Merger-Related Expenses and Deal Costs

The $11.3 million increase in merger-related expenses and deal costs was primarily associated with increased costs in 2021 related to operator transitions, including Eclipse Senior Living, Inc. (“ESL”), partially offset by costs incurred during the third quarter of 2020 related to our lease modification with Brookdale Senior Living.

43


Allowance on Loans Receivable and Investments

The $5.1 million decrease in allowance on loans receivable and investments was due to the third quarter 2020 recognition of COVID-19 related credit losses.

Other

The $28.0 million change in other was primarily due to a third quarter of 2021 decrease of $25.4 million in the fair value of stock warrants received in connection with the Brookdale Senior Living lease modification in the third quarter of 2020.

Income from Unconsolidated Entities

The $1.9 million increase in income from unconsolidated entities was primarily due to our share of increased net income from our investees.

Gain on Real Estate Dispositions

The $137.7 million increase in gain on real estate dispositions was primarily due to the dispositions of 14 medical office buildings and one triple-net leased property that resulted in gains on sale of real estate of $148.8 million recognized during the third quarter of 2021.

Income Tax (Expense) Benefit

The $3.8 million of income tax expense for the three months ended September 30, 2021 as compared to the $3.2 million income tax benefit for the same period in 2020 was primarily due to non-cash tax expense relating to the third quarter 2021 redemption of Ardent Senior Notes and a third quarter 2020 income tax benefit from operating losses at our TRS entities.

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Nine Months Ended September 30, 2021 and 2020

The table below shows our results of operations for the nine months ended September 30, 2021 and 2020 and the effect of changes in those results from period to period on our net income attributable to common stockholders.
For the Nine Months Ended September 30,(Decrease) Increase
to Net Income
 20212020$%
 (Dollars in thousands)
Segment NOI:    
Triple-net leased properties$487,962 $510,234 $(22,272)(4.4)%
Senior living operations326,340 402,059 (75,719)(18.8)
Office operations410,177 412,548 (2,371)(0.6)
All other73,820 66,001 7,819 11.8 
Total segment NOI1,298,299 1,390,842 (92,543)(6.7)
Interest and other income1,343 6,965 (5,622)(80.7)
Interest expense(329,634)(355,333)25,699 7.2 
Depreciation and amortization(878,444)(847,797)(30,647)(3.6)
General, administrative and professional fees(101,156)(100,621)(535)(0.5)
Loss on extinguishment of debt, net(56,808)(7,386)(49,422)nm
Merger-related expenses and deal costs(28,000)(26,129)(1,871)(7.2)
Allowance on loans receivable and investments9,021 (34,654)43,675 nm
Other(10,755)(16,750)5,995 35.8 
(Loss) income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(96,134)9,137 (105,271)nm
Income (loss) from unconsolidated entities7,289 (15,861)23,150 nm
Gain on real estate dispositions194,083 240,101 (46,018)(19.2)
Income tax (expense) benefit(9,574)95,855 (105,429)nm
Income from continuing operations95,664 329,232 (233,568)(70.9)
Net income95,664 329,232 (233,568)(70.9)
Net income attributable to noncontrolling interests5,802 534 (5,268)nm
Net income attributable to common stockholders$89,862 $328,698 (238,836)(72.7)
nm - not meaningful

Segment NOI—Triple-Net Leased Properties

The following table summarizes results of operations in our triple-net leased properties reportable business segment, including assets sold or classified as held for sale as of SeptemberJune 30, 2021.2022 (dollars in thousands):
 For the Nine Months Ended September 30,(Decrease) Increase
to Segment NOI
 20212020$%
 (Dollars in thousands)
Segment NOI—Triple-Net Leased Properties:    
Rental income$500,487 $527,238 $(26,751)(5.1)%
Less: Property-level operating expenses(12,525)(17,004)4,479 26.3 
Segment NOI$487,962 $510,234 (22,272)(4.4)
nm - not meaningful
 For the Six Months Ended June 30,(Decrease) Increase to NOI
 20222021$%
NOI—Triple-Net Leased Properties:
Rental income$300,958 $319,108 $(18,150)(5.7)%
Less: Property-level operating expenses(7,593)(9,257)1,664 18.0 
NOI$293,365 $309,851 $(16,486)(5.3)

The NOI decrease in our triple-net leased properties segment NOI for the ninesix months ended SeptemberJune 30, 20212022 compared to the same period in 20202021 was primarily driven by (i) a $69.0 million reduction (including $18.2 million of contractual rent) attributable to the net impact of the transition of 26 independent living assets operated by Holiday Retirement, from our triple-
45


net portfolio to our senior housing operating portfolio in the beginning of the second quarter of 2020, (ii) a $17.6 million reduction in rental income under our lease with Brookdale Senior Living following modification of the lease in the third quarter of 2020, and (iii) a $19.5 million reduction attributable to rental income from communities that were sold or transitioned to our senior housing operating portfolio and sold prior to SeptemberJune 30, 2021. These decreases were partially2022, slightly offset by the $22.3 million non-cash impact of a lease terminationan acquisition in connection with a transition to a new operator under a management contract during the third quarter of 2021 and $67.6 million of COVID-19 related write-offs of previously accrued straight-line rental income during the second and third quarters of 2020.September 2021.

The following table compares results of operations for our 337330 same-store triple-net leased properties.properties (dollars in thousands):
For the Nine Months Ended September 30,Increase
 to Segment NOI
For the Six Months Ended June 30,(Decrease) Increase to NOI
20212020$% 20222021$%
(Dollars in thousands)
Same-Store Segment NOI—Triple-Net Leased Properties:    
Same-Store NOI—Triple-Net Leased Properties:Same-Store NOI—Triple-Net Leased Properties:
Rental incomeRental income$453,612 $413,485 $40,127 9.7 %Rental income$296,687 $297,362 $(675)(0.2)%
Less: Property-level operating expensesLess: Property-level operating expenses(10,658)(10,885)227 2.1 Less: Property-level operating expenses(7,153)(7,222)69 1.0 
Segment NOI$442,954 $402,600 40,354 10.0 
NOINOI$289,534 $290,140 $(606)(0.2)
nm - not meaningful
The increaseNOI decrease in our same-store triple-net leased properties reportable business segment NOI for the ninesix months ended SeptemberJune 30, 2021 over2022 compared to the same period in 2020 was attributable primarily to a $60.8 million of COVID-19 related write-offs of previously accrued straight-line rental income during the second and third quarters of 2020, partially offset by $17.6 million in lower rental income recognized under our lease with Brookdale Senior Living following modification of the lease in the third quarter of 2020.
Segment NOI—Senior Living Operations
The following table summarizes results of operations in our senior living operations reportable business segment, including assets sold or classified as held for sale as of September 30, 2021.
 For the Nine Months Ended September 30,Decrease
 to Segment NOI
 20212020$%
 (Dollars in thousands)
Segment NOI—Senior Living Operations:    
Resident fees and services$1,622,641 $1,667,421 $(44,780)(2.7)%
Less: Property-level operating expenses(1,296,301)(1,265,362)(30,939)(2.4)
Segment NOI$326,340 $402,059 (75,719)(18.8)
Number of Properties at September 30,Average Unit Occupancy For the Nine Months Ended September 30, Average Monthly Revenue Per Occupied Room For the Nine Months Ended September 30,
 202120202021202020212020
Total communities542 431 77.8 %82.7 %$4,611 $4,811 
The period over period decrease in our senior living operations segment NOI2021 was primarily driven by lower revenue from occupancy and declines in revenue per occupied room, partially offsetlease resolutions after June 30, 2021 with several smaller senior housing triple-net tenants who were materially affected by lower operating expenses and the transition of assets from our triple-net portfolio to our senior living operating portfolio and development properties placed in service. Lower operating expenses in 2021 reflect the receipt of $13.6 million of HHS grants in the first quarter of 2021, which partially mitigated COVID-19 losses incurred by our SHOP communities.COVID-19.

NOI— Non-Segment

The following table compares results of operations for our 276 same-store senior living operating communities.
46


 For the Nine Months Ended September 30,(Decrease) Increase
to Segment NOI
 20212020$%
 (Dollars in thousands)
Same-Store Segment NOI—Senior Living Operations:    
Resident fees and services$1,203,139 $1,310,561 $(107,422)(8.2)%
Less: Property-level operating expenses(924,139)(955,292)31,153 3.3 
Segment NOI$279,000 $355,269 (76,269)(21.5)

 Number of Properties at September 30,Average Unit Occupancy For the Nine Months Ended September 30, Average Monthly Revenue Per Occupied Room For the Nine Months Ended September 30,
 202120202021202020212020
Same-store communities276 276 80.9 %85.0 %$4,938 $5,117 

The period over period$17.3 million decrease in our same-store senior living operations segment NOI was primarily attributable to lower revenue from occupancy and declines in revenue per occupied room, partially offset by lower COVID-19 costs during 2021. Lower operating expenses in 2021 reflect the receipt of $7.5 million of HHS grants in the first quarter of 2021, which partially mitigated COVID-19 losses incurred by our SHOP communities.
Segment NOI—Office Operations
The following table summarizes results of operations in our office operations reportable business segment, including assets sold or classified as held for sale as of September 30, 2021.
 For the Nine Months Ended September 30,(Decrease) Increase
to Segment NOI
 20212020$%
 (Dollars in thousands)
Segment NOI—Office Operations:    
Rental income$599,516 $599,696 $(180)— %
Office building services revenue7,756 6,871 885 12.9 
Total revenues607,272 606,567 705 0.1 
Less:
Property-level operating expenses(195,297)(192,192)(3,105)(1.6)
Office building services costs(1,798)(1,827)29 1.6 
Segment NOI$410,177 $412,548 (2,371)(0.6)
 Number of Properties at September 30,Occupancy at September 30,Annualized Average Rent Per Occupied Square Foot For the Nine Months Ended September 30,
 202120202021202020212020
Total office buildings348 377 90.5 %89.9 %$34 $33 
The decrease in our office operations segmentnon-segment NOI for the ninesix months ended SeptemberJune 30, 2021 over2022 compared to the same period in 2020 was attributable primarily to assets sold in the first quarter of 2020, business interruption proceeds received in 2020 and dispositions of non-core assets for the nine months ended September 30, 2021. These decreases were partially offset by new leasing, increased tenant retention and improved parking revenues.

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The following table compares results of operations for our 330 same-store office buildings.
 For the Nine Months Ended September 30,Increase (Decrease) 
to Segment NOI
 20212020$%
 (Dollars in thousands)
Same-Store Segment NOI—Office Operations:    
Rental income$546,297 $523,813 $22,484 4.3 %
Less: Property-level operating expenses(172,526)(165,896)(6,630)(4.0)
Segment NOI$373,771 $357,917 15,854 4.4 

Number of Properties at September 30,Occupancy at September 30,Annualized Average Rent Per Occupied Square Foot For the Nine Months Ended September 30,
 202120202021202020212020
Same-store office buildings330 330 92.0 %91.9 %$35 $33 
The increase in our same-store office operations segment NOI for the nine months ended September 30, 2021 over the same period in 2020 was primarily due to contractual rent escalators, new leasing, increased retention and improved parking income.
Segment NOI —All Other
The $7.8 million increase in all other segment NOI for the nine months ended September 30, 2021 over the same period in 2020 was primarily due to the $16.6 million gain recognized in the third quarter of 2021 for the redemption of Ardent’s outstanding 9.75% Senior Notes due 2026 and increased management fee revenues from investments in unconsolidated real estate entities, partially offset by reduced interest income from a lower balance of loans receivable investments.investments due to the redemption of Ardent’s senior notes, payoff of certain notes and sale of marketable debt securities in 2021.

Company Results

Interest and Other IncomeExpense

The $5.6$3.9 million decreaseincrease in interest and other incomeexpense for the ninesix months ended SeptemberJune 30, 2021 over2022 compared to the same period in 20202021 was primarily due to a 2020 reductionan increase of a liability related$8.0 million due to higher debt balances and an acquisition and lowerincrease of $0.5 million due to higher capitalized interest, income on short term investments.
Interest Expense
The $25.7 million decrease in total interest expense for the nine months ended September 30, 2021 over the same period in 2020 was primarily attributable topartially offset by a decrease of $36.5 million due to lower debt balances, partially offset by an increase of $10.9$5.1 million due to a higherlower effective interest rate. Our weighted average effective interest rate was 3.6%3.52% and 3.5%3.60% for the ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, respectively. Capitalized interest for the ninesix months ended SeptemberJune 30, 2022 and 2021 and 2020 was $8.5$5.2 million and $8.1$5.8 million, respectively.

Depreciation and Amortization

The $30.6$7.3 million increase in depreciation and amortization expense was primarily due to the $173.0$83.7 million of 2021 impairments relating to properties that were sold or classified as held for sale,depreciation on assets acquired from New Senior, partially offset by $129.5 million of COVID-19 related and disposition relateda net decrease in impairments recognized in 2020.2022 as compared to 2021.

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General, Administrative and Professional Fees

The $0.5$5.0 million increase in general, administrative and professional fees was primarily due to increased stock-based compensation,the return to a more normalized business environment and the inclusion of a portion of New Senior’s overhead, partially offset by lower professional fees and the impact of a reduced headcount in 2020.compensation.

Loss on Extinguishment of Debt, Net

The $49.4$27.0 million increasedecrease in loss on extinguishment of debt, net for the ninesix months ended SeptemberJune 30, 20212022 compared to the same period in 20202021 was due to $56.8 millionthe make whole redemption of losses recognized during 2021 for the redemptions of $400.0 million aggregate principal amount of 3.125% senior notes due 2023, $263.7 million aggregate principal amount of 3.25% senior notes due 2022 and $400.0 million aggregate principal amount of 3.10% senior notes due January 2023 partially offset byduring the $7.4 million non-cash loss recognized in the thirdfirst quarter of 2020 for the redemption of $236.3 million aggregate principal amount of 3.25% senior notes due 2022.2021.
Merger-Related
Transaction Expenses and Deal Costs

The $1.9$27.7 million increase in merger-relatedtransaction expenses and deal costs was primarily attributable to increased costs in the third quarter of 2021 associated with operator transitions, including ESL, partially offset by costs incurred in the third quarter of 2020, including expenses related to the modification of our leaseconnection with Brookdale Senior Living, severance related charges and captive insurance organization costs.stockholder relations matters.

Allowance on Loans Receivable and Investments

The $43.7$8.8 million change in allowance on loans receivable and investments was primarily due to the recognitionreversal of COVID-19 relateda previously recorded credit losses in the second quarter of 2020, which were partially reversedloss in the first quarter of 2021 due toas a change in our estimateresult of credit losses.successful collections.

Other

The $6.0$43.8 million decreaseincrease in other expense was primarily due to the changean increase of $53.5 million in fair value ofunrealized loss on the stock warrants received in connection with the Brookdale Senior Living lease modification in the third quarter of 2020, partially offset by additional$8.3 million of expenses relating to 2021 natural disaster events.winter storms. As of June 30, 2022, the fair value of the stock warrants was $39.6 million, which was $11.5 million higher than the value at the grant date.

(Loss) Income (Loss) from Unconsolidated Entities

The $7.3$9.8 million of income from unconsolidated entities for the nine months ended September 30, 2021 versus the $15.9 million ofincrease in loss from unconsolidated entities for the six months ended June 30, 2022 compared to the same period in 20202021 was primarily due to an impairment of our investment in an unconsolidated operating entity in the second quarter of 2020 and our share of operating resultsincreased net loss from our unconsolidated entities.

Gain on Real Estate Dispositions

The $46.0$41.4 million decrease in gain on real estate dispositions was primarily due to gains recognized in 2020 related to our dispositionthe second quarter 2021 sale of six properties duringone MOB for a gain of $41.3 million, partially offset by the first quarter of 2020, partially offset by $194.1 million in gains during 2021 for the2022 sale of 33 properties.one vacant land parcel for a gain of $2.4 million.

Income Tax Benefit (Expense) Benefit

The $9.6$8.3 million of income tax benefit for the six months ended June 30, 2022 was primarily due to losses in certain of our TRS entities and a $2.0 million benefit from an internal restructuring of a U.S. taxable REIT subsidiary. The $5.8 million of income tax expense for the nine months ended September 30, 2021 as compared to the $95.9 million income tax benefit for the same period in 20202021 was primarily due to a $152.9$2.8 million net deferred tax benefitexpense related to thean internal restructuring of certain U.S. taxable REIT subsidiaries, completed within the first quarter of 2020, partially offset by changes in the valuation allowance againstand a $3.4 million deferred tax assetsexpense related to the revaluation of certain of our TRS entities. The benefit resulted from the transfer of assets subject to certain deferred tax liabilities from taxable REIT subsidiaries toas a result of enacted tax rate changes in the entities other than the TRS entities in this tax-free transaction.United Kingdom.


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Non-GAAP Financial Measures

We consider certain non-GAAP financial measures to be useful supplemental measures of our operating performance. A non-GAAP financial measure is a measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts that are not so excluded from or included in the most directly comparable measure calculated and presented in accordance with U.S. GAAP. Described below are the non-GAAP financial measures used by management to evaluate our operating performance and that we consider most useful to investors, together with reconciliations of these measures to the most directly comparable GAAP measures.

The non-GAAP financial measures we present in this Quarterly Report on Form 10-Q may not be comparable to those presented by other real estate companies due to the fact that not all real estate companies use the same definitions. You should not consider these measures as alternatives to net income attributable to common stockholders (determined in accordance with GAAP) as indicators of our financial performance or as alternatives to cash flow from operating activities (determined in accordance with GAAP) as measures of our liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs. In order to facilitate a clear understanding of our consolidated historical operating results, you should examine these measures in conjunction with net income attributable to common stockholders as presented in our Consolidated Financial Statements and other financial data included elsewhere in this Quarterly Report on Form 10-Q.

Funds From Operations and Normalized Funds From Operations Attributable to Common Stockholders

Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. However, since real estate values historically have risen or fallen with market conditions, many industry investors deem presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. For that reason, we consider Funds From Operations attributable to common stockholders (“FFO”) and Normalized FFO to be appropriate supplemental measures of operating performance of an equity REIT. We believe that the presentation of FFO, combined with the presentation of required GAAP financial measures, has improved the understanding of operating results of REITs among the investing public and has helped make comparisons of REIT operating results more meaningful. Management generally considers FFO to be a useful measure for understanding and comparing our operating results because, by excluding gains and losses related to sales of previously depreciated operating real estate assets, impairment losses on depreciable real estate and real estate asset depreciation and amortization (which can differ across owners of similar assets in similar condition based on historical cost accounting and useful life estimates), FFO can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies. We believe that Normalized FFO is useful because it allows investors, analysts and our management to compare our operating performance to the operating performance of other real estate companies and betweenacross periods on a consistent basis without having to account for differences caused by non-recurring items and other non-operational events such as transactions and litigation. In some cases, we provide information about identified non-cash components of FFO and Normalized FFO because it allows investors, analysts and our management to assess the impact of those items on our financial results.

We use the National Association of Real Estate Investment Trusts (“Nareit”) definition of FFO. Nareit defines FFO as net income attributable to common stockholders (computed in accordance with GAAP), excluding gains or losses(or losses) from sales of real estate property, including gains or lossesgain (or loss) on re-measurement of equity method investments and impairment write-downs of depreciable real estate, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnershipsentities and entities.noncontrolling interests. Adjustments for unconsolidated partnershipsentities and entitiesnoncontrolling interests will be calculated to reflect FFO on the same basis. We define Normalized FFO as Nareit FFO excluding the following income and expense items, (which may be recurring in nature):without duplication: (a) merger-related costs and expenses, including amortization of intangibles, transition and integrationtransaction expenses and deal costs, including transaction, integration and severance-related costs and expenses, and amortization of intangibles, in each case net of noncontrolling interests’ share of these items and including expenses and recoveries relating to acquisition lawsuits;Ventas’ share of these items from unconsolidated entities; (b) the impact of any expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees or additional costs, expenses, discounts, make-whole payments, penalties or premiums incurred as a result of early retirement or payment of our debt; (c) the non-cash effect of income tax benefits or expenses, the non-cash impact of changes to our executive equity compensation plan, derivative transactions that have non-cash mark-to-market impacts on our Consolidated Statements of Income and non-cash charges related to leases; (d) the financial impact of contingent consideration, severance-related costs and charitable donations made to the Ventas Charitable Foundation;consideration; (e) gains and losses for non-operational foreign currency hedge agreements and changes in the fair value of financial instruments; (f) gains and losses on non-real estate dispositions and other unusual items related to unconsolidated entities; (g) expenses related to the re-audit and re-review in 2014 of our historical financial statements and related matters; (h) net expenses or recoveries related to natural disasters;materially disruptive events; and (i) any(h) other incremental items set forth in the Normalized FFO reconciliation included herein.

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The following table summarizes our FFO and Normalized FFO for the three and ninesix months ended SeptemberJune 30, 2022 and 2021 and 2020.(dollars in thousands). The decreaseincrease in Normalized FFO for the ninesix months ended SeptemberJune 30, 20212022 over the same period in 20202021 is principallyprimarily due to the impact of COVID-19 onincreased net operating income at our senior housing business, lower rental incomecommunities as a result of improved occupancy, higher revenue per occupied room, acquisitions since the second quarter of 2021, including the acquisition of over 100 independent living communities from our triple-net lease with BrookdaleNew Senior, Living, and the impact of the dispositions during 2020 and 2021,higher HHS grants received, partially offset by a decrease inlower interest expense.income on loan investments.
 For the Three Months Ended June 30,For the Six Months Ended June 30,
 2022202120222021
Net (loss) income attributable to common stockholders$(42,416)$86,391 $(3,684)$29,182 
Adjustments: 
Depreciation and amortization on real estate assets282,313 249,527 570,416562,397
Depreciation on real estate assets related to noncontrolling interests(4,335)(4,678)(8,784)(9,296)
Depreciation on real estate assets related to unconsolidated entities7,621 4,615 14,8868,633
Loss (gain) on real estate dispositions34 (41,258)(2,421)(43,791)
(Loss) gain on real estate dispositions related to noncontrolling interests— (7)17(7)
Gain on real estate dispositions related to unconsolidated entities(301)— (301)— 
Nareit FFO attributable to common stockholders242,916 294,590 570,129 547,118 
Adjustments:  
Change in fair value of financial instruments37,837 (23,211)7,956(44,219)
Non-cash income tax (benefit) expense(5,379)1,166 (11,184)2,510
Loss (gain) on extinguishment of debt, net of noncontrolling interests and including Ventas’ share attributable to unconsolidated entities(74)727,016
Gain on transactions related to unconsolidated entities— (10)(3)(31)
Transaction expenses and deal costs, net of noncontrolling interests and including Ventas’ share attributable to unconsolidated entities15,027 1,769 36,3157,128
Amortization of other intangibles including Ventas’ share attributable to unconsolidated entities268 116 536233
Other items related to unconsolidated entities(1,285)43 (1,154)143
Non-cash impact of changes to equity plan(2,389)(2,298)4,8176,443
Materially disruptive events, net including Ventas’ share attributable to unconsolidated entities2,074 3,128 (1,635)8,255
Allowance on loan investments, net of noncontrolling interests(61)(57)(114)(8,955)
Normalized FFO attributable to common stockholders$289,015 $275,162 $605,670$545,641

 For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2021202020212020
 (In thousands)
Net income attributable to common stockholders$60,680 $12,751 $89,862 $328,698 
Adjustments: 
Real estate depreciation and amortization312,524 247,969 874,920 843,409 
Real estate depreciation related to noncontrolling interests(4,641)(4,475)(13,937)(12,386)
Real estate depreciation related to unconsolidated entities4,474 1,360 13,107 3,228 
Gain (loss) on real estate dispositions related to noncontrolling interests232 — 225 (9)
Gain on real estate dispositions(150,292)(12,622)(194,083)(240,101)
FFO attributable to common stockholders222,977 244,983 770,094 922,839 
Adjustments:  
Change in fair value of financial instruments25,451 1,157 (18,768)1,134 
Non-cash income tax expense (benefit)2,146 (4,763)4,656 (90,153)
Loss on extinguishment of debt, net34,654 7,386 61,670 7,386 
Gain on transactions related to unconsolidated entities(8,808)(244)(8,839)(5)
Merger-related expenses, deal costs and re-audit costs25,531 12,793 32,660 28,171 
Amortization of other intangibles(22,085)118 (21,853)354 
Other items related to unconsolidated entities987 290 1,131 (848)
Non-cash impact of changes to equity plan(2,359)(1,923)4,084 1,635 
Natural disaster expenses, net1,552 125 9,807 1,318 
Impact of Holiday lease termination— — — (50,184)
Write-off of straight-line rental income, net of noncontrolling interests— 18,408 — 70,776 
Allowance on loan investments and impairment of unconsolidated entities, net of noncontrolling interests(58)4,635 (9,015)44,955 
Normalized FFO attributable to common stockholders$279,988 $282,965 $825,627 $937,378 
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Adjusted EBITDA

We consider Adjusted EBITDA an important supplemental measure because it provides another manner in which to evaluate our operating performance and serves as another indicator of our credit strength and our ability to service our debt obligations. We define Adjusted EBITDA as consolidated earnings before interest, taxes, depreciation and amortization (including non-cash stock-based compensation expense, asset impairment and valuation allowances), excluding gains or losses on extinguishment of debt, our partners’ share of EBITDA of consolidated entities, merger-related expenses and deal costs, expenses related to the re-audit and re-review in 2014 of our historical financial statements, net gains or losses on real estate activity, gains or losses on remeasurement of equity interest upon acquisition, changes in the fair value of financial instruments, unrealized foreign currency gains or losses, net expenses or recoveries related to natural disasters and non-cash charges related to leases, and including Ventas’ share of EBITDA from unconsolidated entities and adjustments for other immaterial or identified items. The following table sets forth a reconciliation of net income attributable to common stockholders to Adjusted EBITDA:
 For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2021202020212020
 (In thousands)
Net income attributable to common stockholders$60,680 $12,751 $89,862 $328,698 
Adjustments:  
Interest108,816 115,505 329,634 355,333 
Loss on extinguishment of debt, net29,792 7,386 56,808 7,386 
Taxes (including tax amounts in general, administrative and professional fees)5,151 (1,849)13,602 (92,056)
Depreciation and amortization313,596 249,366 878,444 847,797 
Non-cash stock-based compensation expense4,700 5,765 26,165 17,322 
Merger-related expenses, deal costs and re-audit costs22,662 11,325 28,000 26,128 
Net income attributable to noncontrolling interests, adjusted for partners’ share of consolidated entity EBITDA(6,578)(6,359)(19,991)(18,096)
Loss from unconsolidated entities, adjusted for Ventas share of EBITDA from unconsolidated entities14,002 11,811 49,581 39,983 
Gain on real estate dispositions(150,292)(12,622)(194,083)(240,100)
Unrealized foreign currency loss (gain)33 (146)158 (152)
Change in fair value of financial instruments25,448 1,155 (18,775)1,133 
Natural disaster expenses, net1,566 181 9,859 1,162 
Write-off of straight-line rental income from Holiday lease termination— — — (50,184)
Write-off of straight-line rental income, net of noncontrolling interests— 18,408 — 70,776 
Allowance on loan investments and impairment of unconsolidated entities, net of noncontrolling interests(58)4,635 (9,013)44,955 
Adjusted EBITDA$429,518 $417,312 $1,240,251 $1,340,085 
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NOI

We also consider NOI an important supplemental measure because it allows investors, analysts and our management to assess our unlevered property-level operating results and to compare our operating results with those of other real estate companies and between periods on a consistent basis. We define NOI as total revenues, less interest and other income, property-level operating expenses and office building and other services costs. Cash receipts may differ due to straight-line recognition of certain rental income and the application of other GAAP policies.

The following table sets forth a reconciliation of net income attributable to common stockholders to NOI:NOI (dollars in thousands):
For the Three Months Ended September 30,For the Nine Months Ended September 30, For the Three Months Ended June 30,For the Six Months Ended June 30,
2021202020212020 2022202120222021
(In thousands)
Net income attributable to common stockholders$60,680 $12,751 $89,862 $328,698 
Net (loss) income attributable to common stockholdersNet (loss) income attributable to common stockholders$(42,416)$86,391 $(3,684)$29,182 
Adjustments:Adjustments:  Adjustments:  
Interest and other incomeInterest and other income(417)(572)(1,343)(6,965)Interest and other income(1,166)(585)(1,702)(926)
Interest expenseInterest expense108,816 115,505 329,634 355,333 Interest expense113,951 110,051 224,745 220,818 
Depreciation and amortizationDepreciation and amortization313,596 249,366 878,444 847,797 Depreciation and amortization283,075 250,700 572,139 564,848 
General, administrative and professional feesGeneral, administrative and professional fees30,259 32,081 101,156 100,621 General, administrative and professional fees32,915 30,588 75,913 70,897 
Loss on extinguishment of debt, net29,792 7,386 56,808 7,386 
Merger-related expenses, deal costs and re-audit costs22,662 11,325 28,000 26,129 
Loss (gain) on extinguishment of debt, netLoss (gain) on extinguishment of debt, net(74)27,016 
Transaction expenses and deal costsTransaction expenses and deal costs13,078 721 33,070 5,338 
Allowance on loans receivable and investmentsAllowance on loans receivable and investments(60)4,999 (9,021)34,654 Allowance on loans receivable and investments(62)(59)(116)(8,961)
OtherOther33,673 5,681 10,755 16,750 Other48,116 (13,490)20,926 (22,918)
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests2,094 986 5,802 534 Net income attributable to noncontrolling interests1,214 1,897 3,074 3,708 
(Income) loss from unconsolidated entities(2,772)(865)(7,289)15,861 
Income tax expense (benefit)3,780 (3,195)9,574 (95,855)
Gain on real estate dispositions(150,292)(12,622)(194,083)(240,101)
(Loss) income from unconsolidated entities(Loss) income from unconsolidated entities1,047 (4,767)5,316 (4,517)
Income tax (benefit) expenseIncome tax (benefit) expense(3,790)3,641 (8,280)5,794 
(Loss) gain on real estate dispositions(Loss) gain on real estate dispositions34 (41,258)(2,421)(43,791)
NOINOI$451,811 $422,826 $1,298,299 $1,390,842 NOI$446,003 $423,756 $918,987 $846,488 

See “Results of Operations” for discussions regarding both segment NOI and same-store segment NOI. We define same-store as properties owned, consolidated and operational for the full period in both comparison periods and that are not otherwise excluded; provided, however, that we may include selected properties that otherwise meet the same-store criteria if they are included in substantially all of, but not a full, period for one or both of the comparison periods, and in our judgment such inclusion provides a more meaningful presentation of our portfoliosegment performance.

Newly acquired development properties and recently developed or redeveloped properties in our senior living operationsSHOP reportable business segment will be included in same-store once they are stabilized for the full period in both periods presented. These properties are considered stabilized upon the earlier of (a) the achievement of 80% sustained occupancy or (b) 24 months from the date of acquisition or substantial completion of work. Recently developed or redeveloped properties in our office operations and triple-net leased properties reportable business segments will be included in same-store once substantial completion of work has occurred for the full period in both periods presented. Our senior living operationshousing operating portfolio and triple-net leased properties that have undergone operator or business model transitions will be included in same-store once operating under consistent operating structures for the full period in both periods presented.

Properties are excluded from same-store if they are: (i) sold, classified as held for sale or properties whose operations were classified as discontinued operations in accordance with GAAP; (ii) impacted by materially disruptive events such as flood or fire; (iii) for SHOP, those properties that are currently undergoing a materially disruptive redevelopment; (iv) for our office operations and triple-net leaseleased properties reportable business segments, those properties for which management has an intention to institute, or has instituted, a redevelopment plan because the properties may require major property-level expenditures to maximize value, increase NOI, or maintain a market-competitive position and/or achieve property stabilization, most commonly as the result of an expected or actual material change in occupancy or NOI; or (v) for the senior living operationsSHOP and triple-net leased properties reportable business segments, those properties that are scheduled to undergo operator or business model transitions, or have transitioned operators or business models after the start of the prior comparison period.        


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To eliminate the impact of exchange rate movements, all portfolio performance-based disclosures assume constant exchange rates across comparable periods, using the following methodology: the current period’s results are shown in actual
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reported USD, while prior comparison period’s results are adjusted and converted to USD based on the average exchange rate for the current period.

Liquidity and Capital Resources    

During the nine months ended September 30, 2021, ourOur principal sources of liquidity wereare cash flows from operations, proceeds from the issuance of debt and equity securities, borrowings under our unsecured revolving credit facility and commercial paper program, and proceeds from asset sales.

For the next 12 months, our principal liquidity needs are to: (i) fund operating expenses; (ii) meet our debt service requirements; (iii) repay maturing mortgage and other debt; (iv) fund acquisitions, investments and commitments and any development and redevelopment activities; (v) fund capital expenditures; and (vi) make distributions to our stockholders and unitholders, as required for us to continue to qualify as a REIT. Depending upon the availability of external capital, we believe our liquidity is sufficient to fund these uses of cash. We expect that these liquidity needs generally will be satisfied by a combination of the following: cash flows from operations, cash on hand, debt assumptions and financings (including secured financings), issuances of debt and equity securities, dispositions of assets (in whole or in part through joint venture arrangements with third parties) and borrowings under our revolving credit facilities and commercial paper program. However, an inability to access liquidity through multiple capital sources concurrently could have a material adverse effect on us.

While continuing decreased revenue and net operating income as a resultOur material contractual obligations arising in the normal course of the COVID-19 pandemic could lead to downgradesbusiness primarily consist of our long-term credit rating and therefore adversely impact our cost of borrowing, we currently believe we will continue to have access to one or more debt markets during the duration of the pandemic and could seek to enter into secured debt financings or issue debt and equity securitiesrelated interest payments, and operating obligations which include ground lease obligations. During the six months ended June 30, 2022, there were no significant changes to satisfy our liquidity needs, although no assurances can be madecontractual obligations from those disclosed in this regard.

the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2021 Annual Report. See “Note 10 – Senior Notes Payable And Other Debt” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information regarding our significant financingdebt activities.

Loans ReceivableWhile continuing decreased revenue and Investments

In October 2021, we received proceedsnet operating income as a result of $45.0 million in full repayment of a cash pay note from Brookdale Senior Living. The note was issuedCOVID-19 could lead to us in connection with the modificationdowngrades of our lease with Brookdale Senior Livingshort- or long-term credit ratings and therefore adversely impact our cost of borrowing, we currently believe we will continue to have access to one or more debt markets during the duration of COVID-19 and could seek to enter into secured debt financings or issue debt and equity securities to satisfy our liquidity needs, although no assurances can be made in the third quarter of 2020.

In July 2021, we received $66 million from Holiday Retirement as repayment in full of secured notes which Holiday Retirement previously issued to us as part of a lease termination transaction entered into in April 2020.

In July 2021, we received aggregate proceeds of $224 million from the redemption of Ardent’s outstanding 9.75% Senior Notes due 2026 at a price equal to 107.313% of the principal amount of the notes, plus accrued and unpaid interest. The redemption resulted in a gain of $16.6 million which is recorded in income from loans and investments in our Consolidated Statements of Income. As of December 31, 2020, $23.0 million of unrealized gain related to these securities was included in accumulated other comprehensive income.this regard.

Credit Facilities, Commercial Paper and Unsecured Term Loans

In January 2021, we entered into an amended and restated unsecured credit facility (the “New Credit Facility”) comprised ofWe have a $2.75 billion unsecured revolving credit facility initially priced at LIBOR plus 0.825% based on the Company’s debt rating. The New Credit Facility replaced our previous $3.0 billion unsecured revolving credit facility priced at 0.875%. The New Credit Facility matures in January 2025, but may be extended at our option, subject to the satisfaction of certain conditions, for two additional periods of six months each. The New Credit Facilitycredit facility also includes an accordion feature that permits us to increase our aggregate borrowing capacity thereunder to up to $3.75 billion, subject to the satisfaction of certain conditions.

As of SeptemberJune 30, 2021,2022, we had $2.7 billion of undrawn capacity on our New Credit Facilityunsecured revolving credit facility with $49.1$45.6 million borrowings outstanding and an additional $24.9$25.0 million restricted to support outstanding letters of credit. We limit our use of the New Credit Facility,unsecured revolving credit facility, to the extent necessary, to support our commercial paper program when commercial paper notes are outstanding. As of September 30, 2021, we had $370.0 million of commercial paper outstanding.

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Our wholly owned subsidiary, Ventas Realty, Limited Partnership (“Ventas Realty”), may issue from time to time unsecured commercial paper notes up to a maximum aggregate amount outstanding at any time of $1.0 billion. The notes are sold under customary terms in the United StatesU.S. commercial paper note market and are ranked pari passu with all of Ventas Realty’s other unsecured senior indebtedness. The notes are fully and unconditionally guaranteed by Ventas, Inc. As of SeptemberJune 30, 2021,2022, we had $370.0$335.3 million ofin borrowings outstanding under our commercial paper program.

As of September 30, 2021,In June 2022, we hadentered into a Credit and Guaranty Agreement (the “New Credit Agreement”) with Ventas Realty, as borrower. The New Credit Agreement replaces Ventas Realty’s previous $200.0 million unsecured term loan priced at LIBOR plus 0.90% that matured in 2023 with a new $500.0 million unsecured term loan that matures in 2023.2027 and is initially priced at Term SOFR plus 0.95% based on Ventas Realty’s debt ratings. The term loanNew Credit Agreement also includes an accordion feature that effectively permits us to increase our aggregate borrowings thereunder to up to $800.0 million.$1.25 billion, subject to the satisfaction of certain conditions, including the receipt of additional commitments for such increase.

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As of SeptemberJune 30, 2021,2022, we had a C$500500.0 million unsecured term loan facility priced at Canadian Dollar Offered Rate (“CDOR”) plus 0.90% that matures in 2025.

During the three months ended September 30, 2021, we terminated the $400.0 million secured revolving construction credit facility, resulting in a loss on extinguishment of debt of $0.5 million for the three months ended September 30, 2021. There were no borrowings outstanding under the secured revolving construction credit facility as of September 30, 2021.

Senior Notes

In August 2021, Ventas Realty issued and sold $500.0 million aggregate principal amount of 2.50% senior notes due 2031 at 99.74% of par.

In August 2021, Ventas Realty issued a make whole notice of redemption for the entirety of the $400.0 million aggregate principal amount of 3.125% senior notes due 2023, resulting in a loss on extinguishment of debt of $20.9 million for the three months ended September 30, 2021. The redemption settled in September 2021, principally using cash on hand.

In July 2021, Ventas Realty and Ventas Capital Corporation issued a make whole notice of redemption for the entirety of the $263.7 million aggregate principal amount of 3.25% senior notes due 2022, resulting in a loss on extinguishment of debt of $8.2 million for the three months ended September 30, 2021. The redemption settled in August 2021, principally using cash on hand.

In February 2021, Ventas Realty issued a make whole notice of redemption for the entirety of the $400.0 million aggregate principal amount of 3.10% senior notes due January 2023, resulting in a loss on extinguishment of debt of $27.3 million for the three months ended March 31, 2021. The redemption settled in March 2021, principally using cash on hand.

We may, from time to time, seek to retire or purchase our outstanding senior notes for cash or in exchange for equity securities in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, prospects for capital and other factors. The amounts involved may be material.

Equity Offerings

In September 2021,We participate in connection with the New Senior Acquisition, we issued approximately 13.3 million of our common stock.

From time to time, we may sell our common stock under an “at-the-market” equity offering program (“ATM program”)., pursuant to which we may, from time to time, sell up to $1.0 billion aggregate gross sales price of shares of our common stock. There were no issuances under the ATM program for the six months ended June 30, 2022. As of SeptemberJune 30, 2021, we had $129.0 million remaining under our existing ATM program. During the three months ended September 30, 2021, we sold 10.6 million2022, $1.0 billion aggregate gross sales price of shares of our common stock remains available for issuance under ourthe ATM program for gross proceeds of $611.7 million, representing an average price of $57.73 per share. During the nine months ended September 30, 2021, we sold 10.9 million shares of our common stock under our ATM program for gross proceeds of $626.4 million, representing an average price of $57.71 per share. program.

Mortgages

In September 2021, we assumed mortgage debt of $482.5 million in connection with the New Senior Acquisition, including a $25.4 million fair value premium which will be amortized over the remaining term through interest expense in our Consolidated Statement of Income. See “Note 4 – Acquisitions Of Real Estate Property”.

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Derivatives and Hedging

In the normal course of our business, interest rate fluctuations affect future cash flows under our variable rate debt obligations, loans receivable and marketable debt securities, and foreign currency exchange rate fluctuations affect our operating results. We follow established risk management policies and procedures, including the use of derivative instruments, to mitigate the impact of these risks.

Dividends

During the ninesix months ended SeptemberJune 30, 2021,2022, we declared a dividend of $0.45 per share of our common stock in each of the first and second and third quarter, respectively.quarter. In order to continue to qualify as a REIT, we must make annual distributions to our stockholders of at least 90% of our REIT taxable income (excluding net capital gain). In addition, we will be subject to income tax at the regular corporate rate to the extent we distribute less than 100% of our REIT taxable income, including any net capital gains. We intend to pay dividends greater than 100% of our taxable income, after the use of any net operating loss carryforwards, for 2021.2022.

We expect that our cash flows will exceed our REIT taxable income due to depreciation and other non-cash deductions in computing REIT taxable income and that we will be able to satisfy the 90% distribution requirement. However, from time to time, we may not have sufficient cash on hand or other liquid assets to meet this requirement or we may decide to retain cash or distribute such greater amount as may be necessary to avoid income and excise taxation. If we do not have sufficient cash on hand or other liquid assets to enable us to satisfy the 90% distribution requirement, or if we desire to retain cash, we may borrow funds, issue additional equity securities, pay taxable stock dividends, if possible, distribute other property or securities or engage in a transaction intended to enable us to meet the REIT distribution requirements or any combination of the foregoing.

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Cash Flows    
    
The following table sets forth our sources and uses of cash flows:flows for the six months ended June 30, 2022 and 2021 (dollars in thousands):
For the Nine Months Ended September 30,Increase (Decrease) to Cash
20212020$% For the Six Months Ended June 30,(Decrease) Increase to Cash
(Dollars in thousands) 20222021$%
Cash, cash equivalents and restricted cash at beginning of periodCash, cash equivalents and restricted cash at beginning of period$451,640 $146,102 $305,538 nmCash, cash equivalents and restricted cash at beginning of period$196,597 $451,640 $(255,043)(56.5)%
Net cash provided by operating activitiesNet cash provided by operating activities760,315 1,154,413 (394,098)(34.1)%Net cash provided by operating activities552,632 528,856 23,776 4.5
Net cash (used in) provided by investing activities(716,343)186,625 (902,968)nm
Net cash used in investing activitiesNet cash used in investing activities(559,260)(121,105)(438,155)nm
Net cash used in financing activitiesNet cash used in financing activities(299,612)(857,699)558,087 65.1 Net cash used in financing activities(12,946)(586,073)573,127 97.8
Effect of foreign currency translationEffect of foreign currency translation522 (951)1,473 nmEffect of foreign currency translation(992)1,450 (2,442)nm
Cash, cash equivalents and restricted cash at end of periodCash, cash equivalents and restricted cash at end of period$196,522 $628,490 (431,968)(68.7)Cash, cash equivalents and restricted cash at end of period$176,031 $274,768 $(98,737)(35.9)

nm - not meaningful

Cash Flows from Operating Activities
    
Cash flows from operating activities decreased $394.1increased $23.8 million during the ninesix months ended SeptemberJune 30, 20212022 compared to the same period in 20202021 primarily due to the COVID-19 impact onincreased net operating income at our triple-net leased and senior housing business,communities as a result of improved occupancy, higher revenue per occupied room, HHS grants received and acquisitions including the impactacquisition of up-front consideration received in the third quarter of 2020 relating to our lease modification with Brookdaleover 100 independent living communities from New Senior, Living, subsequent lower rental income from our triple-net lease with Brookdale Senior Living, partially offset by a decreaseincreased transaction expenses and deal costs primarily due to expenses relating to the stockholder relations matters in interest expense.2022.

Cash Flows from Investing Activities    

Cash flows from investing activities decreased $903.0$438.2 million during the ninesix months ended SeptemberJune 30, 2021 over2022 compared to the same period in 20202021 primarily due to the $1.1 billion paid in connection with the New Senior Acquisition, fewerincreased acquisitions and decreased proceeds from real estate dispositions, partially offset by proceeds received from the repayment of loans receivable.lower development project expenditures in 2022.

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Cash Flows from Financing Activities
    
Cash flows used infrom financing activities decreased $558.1increased $573.1 million during the ninesix months ended SeptemberJune 30, 2021 over2022 compared to the same period in 20202021 primarily due to the 2021 issuance of 10.9 million shares of common stock through our ATM equity offering program, lower dividends to common stockholders during 2021,incremental proceeds from the 2021 issuance of $500our new $500.0 million senior notes due 2031unsecured term loan and higher proceeds received in 2021 from commercial paper anddecreased borrowings under our revolving credit facility, partially offset by 2021 redemption of $1.1 billion of senior notes duefacilities in 2022 and 2023.2022.

Capital Expenditures

The terms of our triple-net leases generally obligate our tenants to pay all capital expenditures necessary to maintain and improve our triple-net leased properties. However, from time to time, we may fund the capital expenditures for our triple-net leased properties through loans or advances to the tenants, which may increase the amount of rent payable with respect to the properties in certain cases. We may also fund capital expenditures for which we may become responsible upon expiration of our triple-net leases or in the event that our tenants are unable or unwilling to meet their obligations under those leases. We also expect to fund capital expenditures related to our senior living operationsSHOP and office operations reportable business segments with the cash flows from the properties or through additional borrowings. We expect that these liquidity needs generally will be satisfied by a combination of the following: cash flows from operations, cash on hand, debt assumptions and financings (including secured financings), issuances of debt and equity securities, dispositions of assets (in whole or in part through joint venture arrangements with third parties) and borrowings under our revolving credit facilities.

To the extent that unanticipated capital expenditure needs arise or significant borrowings are required, our liquidity may be affected adversely. Our ability to borrow additional funds may be restricted in certain circumstances by the terms of the instruments governing our outstanding indebtedness.

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We are party to certain agreements that obligate us to develop senior housing or healthcare properties funded through capital that we and, in certain circumstances, our joint venture partners provide. As of SeptemberJune 30, 2021,2022, we had 1215 properties under development pursuant to these agreements, including threeseven properties that are owned by an unconsolidated real estate entity. In addition, from time to time, we engage in redevelopment projects with respect to our existing senior housing communities to maximize the value, increase NOI, maintain a market-competitive position, achieve property stabilization or change the primary use of the property.

Contractual Obligations

During the three months ended September 30, 2021, there were no significant changes to our contractual obligations from those disclosed in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2020 Annual Report.

Off-Balance Sheet Arrangements

We own interests in certain unconsolidated entities as described in Note“Note 7 – Investments In Unconsolidated Entities. Except in limited circumstances, our risk of loss is limited to our investment in the joint venture and any outstanding loans receivable. In addition, we have certain properties which serve as collateral for debt that is owed by a previous owner of certain of our facilities, as described under Note“Note 10 – Senior Notes Payable And Other DebtDebt” to the Consolidated Financial Statements. Our risk of loss for these certain properties is limited to the outstanding debt balance plus penalties, if any. Further, we use financial derivative instruments to hedge interest rate and foreign currency exchange rate exposure. Finally, at SeptemberJune 30, 2021,2022, we had $24.9$25.0 million outstanding letterletters of credit obligations. We have no other material off-balance sheet arrangements that we expect would materially affect our liquidity and capital resources except those described above under “Contractual Obligations.”

above.

Guarantor and Issuer Financial Information

Ventas, Inc. has fully and unconditionally guaranteed the obligation to pay principal and interest with respect to the outstanding senior notes issued by our 100% owned subsidiary, Ventas Realty, including the senior notes that were jointly issued with Ventas Capital Corporation. Ventas Capital Corporation is a direct 100% owned subsidiary of Ventas Realty that has no assets or operations, but was formed in 2002 solely to facilitate offerings of senior notes by a limited partnership.Realty. None of our other subsidiaries (excluding Ventas Realty and Ventas Capital Corporation) is obligated with respect to Ventas Realty’s outstanding senior notes.
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Ventas, Inc. has also fully and unconditionally guaranteed the obligation to pay principal and interest with respect to the outstanding senior notes issued by our 100% owned subsidiary, Ventas Canada Finance Limited (“Ventas Canada”). None of our other subsidiaries is obligated with respect to Ventas Canada’s outstanding senior notes, all of which were issued on a private placement basis in Canada.

Under certain circumstances, contractual and legal restrictions, including those contained in the instruments governing our subsidiaries’ outstanding mortgage indebtedness, may restrict our ability to obtain cash from our subsidiaries for the purpose of meeting our debt service obligations, including our payment guarantees with respect to Ventas Realty’s and Ventas Canada’s senior notes.

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The following summarizes our guarantor and issuer balance sheet and statement of income information as of SeptemberJune 30, 20212022 and December 31, 20202021 and for the ninesix months ended SeptemberJune 30, 20212022 and the year ended December 31, 2020.2021 (in thousands).

Balance Sheet Information
As of September 30, 2021
GuarantorIssuerAs of June 30, 2022
(In thousands)GuarantorIssuer
AssetsAssets  Assets  
Investment in and advances to affiliatesInvestment in and advances to affiliates$17,366,051 $3,045,738 Investment in and advances to affiliates$17,795,253 $3,045,738 
Total assetsTotal assets17,503,720 3,158,027 Total assets17,888,438 3,154,422 
Liabilities and equityLiabilities and equity  Liabilities and equity  
Intercompany loansIntercompany loans10,452,948 (3,657,080)Intercompany loans11,497,438 (3,842,175)
Total liabilitiesTotal liabilities10,703,026 4,073,436 Total liabilities11,721,239 4,170,108 
Redeemable OP unitholder and noncontrolling interestsRedeemable OP unitholder and noncontrolling interests86,106 — Redeemable OP unitholder and noncontrolling interests100,215 — 
Total equity (deficit)Total equity (deficit)6,714,588 (915,409)Total equity (deficit)6,066,984 (1,015,686)
Total liabilities and equityTotal liabilities and equity17,503,720 3,158,027 Total liabilities and equity17,888,438 3,154,422 

Balance Sheet
As of December 31, 2021
GuarantorIssuer
Assets  
Investment in and advances to affiliates$17,448,874 $3,045,738 
Total assets17,561,305 3,156,840 
Liabilities and equity  
Intercompany loans10,742,915 (3,563,060)
Total liabilities10,972,521 4,097,362 
Redeemable OP unitholder and noncontrolling interests98,356 — 
Total equity (deficit)6,490,428 (940,522)
Total liabilities and equity17,561,305 3,156,840 

Statement of Income Information
As of December 31, 2020
GuarantorIssuer
 (In thousands)
Assets  
Investment in and advances to affiliates$16,576,278 $2,727,931 
Total assets16,937,149 2,844,339 
Liabilities and equity  
Intercompany loans10,691,626 (4,532,350)
Total liabilities10,918,320 3,577,009 
Redeemable OP unitholder and noncontrolling interests89,669 — 
Total equity (deficit)5,929,161 (732,670)
Total liabilities and equity16,937,149 2,844,339 
For the Six Months Ended June 30, 2022
GuarantorIssuer
Equity earnings in affiliates$58,675 $— 
Total revenues62,243 74,213 
Loss before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests(2,591)(81,160)
Net loss(3,684)(81,160)
Net loss attributable to common stockholders(3,684)(81,160)

For the Year Ended December 31, 2021
GuarantorIssuer
Equity earnings in affiliates$133,143 $— 
Total revenues137,348 158,255 
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests49,694 (215,773)
Net income (loss)49,008 (215,777)
Net income (loss) attributable to common stockholders49,008 (215,777)
5855




Statement of Income Information
For the Nine Months Ended September 30, 2021
GuarantorIssuer
 (In thousands)
Equity earnings in affiliates$132,175 $— 
Total revenues134,544 108,731 
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests91,291 (188,600)
Net income (loss)89,862 (188,604)
Net income (loss) attributable to common stockholders89,862 (188,604)

Statement of Income Information
For the Year Ended December 31, 2020
GuarantorIssuer
 (In thousands)
Equity earnings in affiliates$469,311 $— 
Total revenues474,392 143,259 
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests440,210 (215,406)
Net income (loss)439,149 (202,845)
Net income (loss) attributable to common stockholders439,149 (202,845)


ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The following discussion of our exposure to various market risks contains forward-looking statements that involve risks and uncertainties. These projected results have been prepared utilizing certain assumptions considered reasonable in light of information currently available to us. Nevertheless, because of the inherent unpredictability of interest rates and other factors, actual results could differ materially from those projected in such forward-looking information.

We are exposed to market risk related to changes in interest rates with respect to borrowings under our unsecured revolving credit facility, commercial paper program and our unsecured term loans, certain of our mortgage loans that are floating rate obligations, mortgage loans receivable that bear interest at floating rates and available for sale securities. These market risks result primarily from changes in LIBOR rates or primebenchmark interest rates. To manage these risks, we continuously monitor our level of floatingvariable rate debt with respect to total debt and other factors, including our assessment of current and future economic conditions.

As of SeptemberJune 30, 20212022 and December 31, 2020,2021, the fair value of our secured and non-mortgage loans receivable, based on our estimates of current prevailing rates for comparable loans, was $541.5$482.1 million and $565.7$498.0 million, respectively.

The fair value of our fixed rate debt is based on current market interest rates at which we could obtain similar borrowings. Increases in market interest rates typically result in a decrease in the fair value of fixed rate debt while decreases in market interest rates typically result in an increase in the fair value of fixed rate date. While changes in market interest rates affect the fair value of our fixed rate debt, these changes do not affect the interest expense associated with our fixed rate debt. Therefore, interest rate risk does not have a significant impact on our fixed rate debt obligations until their maturity or earlier prepayment and refinancing. If interest rates have risen at the time we seek to refinance our fixed rate debt, whether at maturity or otherwise, our future earnings and cash flows could be adversely affected by additional borrowing costs. Conversely, lower interest rates at the time of refinancing may reduce our overall borrowing costs.

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To highlight the sensitivity of our fixed rate debt to changes in interest rates, the following summary shows the effects of a hypothetical instantaneous change of 100 basis points in interest rates:rates (dollars in thousands):
As of September 30, 2021As of December 31, 2020
(In thousands)As of June 30, 2022As of December 31, 2021
Gross book valueGross book value$10,619,121 $10,458,262 Gross book value$10,993,221 $10,990,982 
Fair valueFair value11,487,519 11,550,236 Fair value10,437,308 11,766,336 
Fair value reflecting change in interest rates:Fair value reflecting change in interest rates: Fair value reflecting change in interest rates: 
-100 basis points -100 basis points12,145,908 12,204,507  -100 basis points10,941,891 12,437,306 
+100 basis points +100 basis points10,899,335 10,951,483  +100 basis points9,975,805 11,164,150 

The increase in ourOur fixed rate debt was relatively flat from December 31, 20202021 to SeptemberJune 30, 2021 was primarily due to an increase in mortgage loans outstanding, largely as a result of mortgage debt assumed in connection with the New Senior Acquisition, and the issuance of $500.0 million of senior notes due in 2031, partially offset by the redemptions of senior notes due in 2022 and 2023.


2022.

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The table below sets forth certain information with respect to our debt, excluding premiums and discounts:discounts (dollars in thousands):

As of September 30, 2021As of December 31, 2020As of September 30, 2020
(Dollars in thousands)As of June 30, 2022As of December 31, 2021As of June 30, 2021
Balance:Balance:   Balance:   
Fixed rate:Fixed rate:   Fixed rate:   
Senior notesSenior notes$8,309,779 $8,869,036 $9,057,583 Senior notes$8,701,295 $8,729,102 $8,498,317 
Unsecured term loansUnsecured term loans200,000 200,000 200,000 Unsecured term loans200,000 200,000 200,000 
Mortgage loans and otherMortgage loans and other2,109,342 1,389,227 1,399,033 Mortgage loans and other2,091,926 2,061,880 1,561,534 
Subtotal fixed rateSubtotal fixed rate10,993,221 10,990,982 10,259,851 
Variable rate:Variable rate:Variable rate:
Senior notesSenior notes236,630 235,664 225,242 Senior notes— — 242,053 
Unsecured revolving credit facilityUnsecured revolving credit facility49,141 39,395 41,484 Unsecured revolving credit facility45,594 56,448 46,324 
Unsecured term loansUnsecured term loans394,384 392,773 375,404 Unsecured term loans688,440 395,757 403,421 
Commercial paper notesCommercial paper notes370,000 — — Commercial paper notes335,300 280,000 170,000 
Secured revolving construction credit facilitySecured revolving construction credit facility— 154,098 164,585 Secured revolving construction credit facility— — 43,908 
Mortgage loans and otherMortgage loans and other473,470 702,878 677,337 Mortgage loans and other330,940 369,951 684,997 
Subtotal variable rateSubtotal variable rate1,400,274 1,102,156 1,590,703 
TotalTotal$12,142,746 $11,983,071 $12,140,668 Total$12,393,495 $12,093,138 $11,850,554 
Percentage of total debt:Percentage of total debt:   Percentage of total debt:   
Fixed rate:Fixed rate:   Fixed rate:   
Senior notesSenior notes68.4 %73.9 %74.6 %Senior notes70.2 %72.1 %71.7 %
Unsecured term loansUnsecured term loans1.6 1.7 1.6 Unsecured term loans1.6 1.7 1.7 
Mortgage loans and otherMortgage loans and other17.4 11.6 11.5 Mortgage loans and other16.9 17.0 13.2 
Variable rate:Variable rate:Variable rate:
Senior notesSenior notes1.9 2.0 1.9 Senior notes— — 2.0 
Unsecured revolving credit facilityUnsecured revolving credit facility0.4 0.3 0.3 Unsecured revolving credit facility0.4 0.5 0.4 
Unsecured term loansUnsecured term loans3.2 3.3 3.1 Unsecured term loans5.6 3.3 3.4 
Commercial paper notesCommercial paper notes3.0 — — Commercial paper notes2.7 2.3 1.4 
Secured revolving construction credit facilitySecured revolving construction credit facility— 1.3 1.4 Secured revolving construction credit facility— — 0.4 
Mortgage loans and otherMortgage loans and other4.1 5.9 5.6 Mortgage loans and other2.6 3.1 5.8 
TotalTotal100.0 %100.0 %100.0 %Total100.0 %100.0 %100.0 %
Weighted average interest rate at end of period:Weighted average interest rate at end of period:   Weighted average interest rate at end of period:   
Fixed rate:Fixed rate:   Fixed rate:   
Senior notesSenior notes3.7 %3.7 %3.7 %Senior notes3.7 %3.7 %3.8 %
Unsecured term loansUnsecured term loans3.6 3.6 3.6 Unsecured term loans3.6 3.6 3.6 
Mortgage loans and otherMortgage loans and other3.6 3.5 3.6 Mortgage loans and other3.6 3.6 3.5 
Variable rate:Variable rate:Variable rate:
Senior notesSenior notes1.0 1.0 1.1 Senior notes— — 1.0 
Unsecured revolving credit facilityUnsecured revolving credit facility1.1 1.0 1.1 Unsecured revolving credit facility2.3 1.1 1.0 
Unsecured term loansUnsecured term loans1.3 1.4 1.4 Unsecured term loans2.8 1.4 1.3 
Commercial paper notesCommercial paper notes0.2 — — Commercial paper notes1.9 0.3 0.2 
Secured revolving construction credit facilitySecured revolving construction credit facility— 1.9 1.9 Secured revolving construction credit facility— — 1.8 
Mortgage loans and otherMortgage loans and other1.7 1.9 1.9 Mortgage loans and other2.7 1.7 1.9 
TotalTotal3.4 3.4 3.5 Total3.5 3.4 3.4 

The variable rate debt in the table above reflects, in part, the effect of $146.2$145.5 million notional amount of interest rate swaps with maturities ranging frommaturing on March 2022 to May 2022,2027, in each case that effectively convert fixed rate debt to variable rate debt. In addition, the fixed rate debt in the table above reflects, in part, the effect of $303.8$301.7 million and C$275.6270.9 million notional amount of interest rate swaps with maturities ranging from January 2023 to April 2031 in each case that effectively convert variable rate debt to fixed rate debt.

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The decreaseincrease in our outstanding variable rate debt at SeptemberJune 30, 20212022 compared to December 31, 20202021 is primarily attributable to reduced borrowings under our secured revolving construction credit facilityunsecured term loan and repayments of variable rate mortgage loans,commercial paper program, partially offset by borrowings under our commercial paper program.payoffs of mortgage loans.

Assuming a 100 basis point increase in the weighted average interest rate related to our variable rate debt and assuming no change in our variable rate debt outstanding as of SeptemberJune 30, 2021,2022, interest expense on an annualized basis would increase by approximately $14.7$13.8 million, or $0.04$0.03 per diluted common share.

As of SeptemberJune 30, 20212022 and December 31, 2020,2021, our joint venture partners’ aggregate share of total debt was $277.3$271.4 million and $271.6$278.0 million, respectively, with respect to certain properties we owned through consolidated joint ventures. Total debt does not include our portion of debt related to investments in unconsolidated real estate entities, which was $292.5$424.6 million and $213.0$338.1 million as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively.
    
As a result of our Canadian and United Kingdom operations, we are subject to fluctuations in certain foreign currency exchange rates that may, from time to time, affect our financial condition and operating performance. Based solely on our results for the ninesix months ended SeptemberJune 30, 20212022 (including the impact of existing hedging arrangements), if the value of the U.S. dollar relative to the British pound and Canadian dollar were to increase or decrease by one standard deviation compared to the average exchange rate during the year, our Normalized FFO per share for the three and ninesix months ended SeptemberJune 30, 20212022 would decrease or increase, as applicable, by less than $0.01 per share or 1%. We will continue to mitigate these risks through a layered approach to hedging looking out for the next year and continual assessment of our foreign operational capital structure. Nevertheless, we cannot assure you that any such fluctuations will not have an effect on our earnings.

ITEM 4.    CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As required by Rules 13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of SeptemberJune 30, 2021.2022. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of SeptemberJune 30, 2021,2022, at the reasonable assurance level.

Internal Control Over Financial Reporting    
 
There have been no changes in our internal controls over financial reporting during the thirdsecond quarter of 20212022 (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

    
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PART II—OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

The information contained in “Note 12 – Litigation”Commitments And Contingencies” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated by reference into this Item 1. Except as set forth therein, there have been no new material legal proceedings and no material developments in the legal proceedings reported in our 20202021 Annual Report.

ITEM 1A.    RISK FACTORS

In the thirdsecond quarter of 20212022, there were no significant new risk factors from those disclosed under Part I, Item 1A. “Risk Factors” of our 20202021 Annual Report and Part II, Item 1A. “Risk Factors” of our secondfirst quarter Form 10-Q. However, the risks and uncertainties that we face are not limited to those set forth in the 20202021 Annual Report and secondfirst quarter Form 10-Q. Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also adversely affect our business, results of operations and financial condition.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

We do not have a publicly announced repurchase plan or program in effect. The table below summarizes other repurchases of our common stock made during the quarter ended SeptemberJune 30, 2021.2022.
Number of Shares
Repurchased (1)
Average Price
Per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or ProgramsMaximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs
July 1 through July 31— $— — — 
August 1 through August 31176 55.00 — — 
September 1 through September 301,779 56.19 — — 
Total1,955 $56.08 — — 
Number of Shares
Repurchased (1)
Average Price
Per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or ProgramsMaximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs
April 1 through April 3093 $55.55 — — 
May 1 through May 31101 56.74 — — 
June 1 through June 30171 56.71 — — 
Total365 $56.42 — — 

(1)Repurchases represent shares withheld to pay taxes on the vesting of restricted stock granted to employees under our 2006 Incentive Plan or 2012 Incentive Plan or restricted stock units granted to employees under the Nationwide Health Properties, Inc. (“NHP”) 2005 Performance Incentive Plan and assumed by us in connection with our acquisition of NHP. The value of the shares withheld is the closing price of our common stock on the date the vesting or exercise occurred (or, if not a trading day, the immediately preceding trading day) or the fair market value of our common stock at the time of exercise, as the case may be.

ITEM 5.    OTHER INFORMATION

Not applicable.


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ITEM 6.    EXHIBITS

The exhibits required by Item 601 of Regulation S-K which are filed with this report are listed below.
Exhibit
Number
Description of Document
First Amendment to the Third AmendedVentas, Inc. 2022 Incentive Plan
Credit and Restated CreditGuaranty Agreement, dated as of October 5, 2021,June 27, 2022, among Ventas Realty, Limited Partnership, Ventas SSL Ontario II, Inc., Ventas SSL Ontario III, Inc., Ventas Canada Finance Limited, Ventas UK Finance, Inc., and Ventas Euro Finance, LLC,a Delaware limited partnership, as Borrowers,borrower, Ventas, Inc., a Delaware corporation, as Guarantor,guarantor, the lending institutions party thereto from time to time, and Bank of America, N.A., as Administrative Agent.Agent, incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on June 30, 2022.
List of Guarantors and Issuers of Guaranteed Securities.
Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.
Certification of Robert F. Probst, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.
Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.
Certification of Robert F. Probst, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.
101
The following materials from the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended SeptemberJune 30, 2021,2022, formatted in XBRL (Inline Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Equity, (v) the Consolidated Statements of Cash Flows and (vi) Notes to the Consolidated Financial Statements.
104Cover Page Interactive Data File (formatted as inline XBRL).
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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: NovemberAugust 5, 20212022
VENTAS, INC.
By:/s/ DEBRA A. CAFARO
Debra A. Cafaro
 Chairman and
Chief Executive Officer
By:/s/ ROBERT F. PROBST
Robert F. Probst
Executive Vice President and
Chief Financial Officer
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