Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2023 | May 05, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-32641 | |
Entity Registrant Name | BROOKDALE SENIOR LIVING INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-3068069 | |
Entity Address, Address Line One | 111 Westwood Place, | |
Entity Address, Address Line Two | Suite 400, | |
Entity Address, City or Town | Brentwood, | |
Entity Address, State or Province | TN | |
Entity Address, Postal Zip Code | 37027 | |
City Area Code | 615 | |
Local Phone Number | 221-2250 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 188,214,462 | |
Entity Central Index Key | 0001332349 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Common stock: | ||
Document Information [Line Items] | ||
Title of 12(b) security | Common Stock, $0.01 Par Value Per Share | |
Entity Trading Symbol | BKD | |
Security Exchange Name | NYSE | |
Tangible Equity Units, 7.00% | ||
Document Information [Line Items] | ||
Title of 12(b) security | 7.00% Tangible Equity Units | |
Entity Trading Symbol | BKDT | |
Security Exchange Name | NYSE |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 362,235 | $ 398,850 |
Marketable securities | 69,009 | 48,680 |
Restricted cash | 29,374 | 27,735 |
Accounts receivable, net | 52,618 | 55,761 |
Assets held for sale | 23,555 | 0 |
Prepaid expenses and other current assets, net | 129,640 | 106,067 |
Total current assets | 666,431 | 637,093 |
Property, plant and equipment and leasehold intangibles, net | 4,493,002 | 4,535,702 |
Operating lease right-of-use assets | 565,641 | 597,130 |
Restricted cash | 45,133 | 47,963 |
Investment in unconsolidated ventures | 54,788 | 55,333 |
Goodwill | 27,321 | 27,321 |
Deferred tax asset | 1,359 | 1,604 |
Other assets, net | 32,184 | 34,916 |
Total assets | 5,885,859 | 5,937,062 |
Current liabilities | ||
Current portion of long-term debt | 87,711 | 66,043 |
Current portion of financing lease obligations | 24,683 | 24,059 |
Current portion of operating lease obligations | 177,894 | 176,758 |
Trade accounts payable | 88,730 | 71,000 |
Liabilities held for sale | 19,455 | 0 |
Accrued expenses | 238,356 | 237,148 |
Refundable fees and deferred revenue | 70,447 | 66,197 |
Total current liabilities | 707,276 | 641,205 |
Long-term debt, less current portion | 3,772,254 | 3,784,099 |
Financing lease obligations, less current portion | 218,349 | 224,801 |
Operating lease obligations, less current portion | 575,603 | 616,973 |
Other liabilities | 71,523 | 85,831 |
Total liabilities | 5,345,005 | 5,352,909 |
Preferred stock, $0.01 par value, 50,000,000 shares authorized at March 31, 2023 and December 31, 2022; no shares issued and outstanding | 0 | 0 |
Common stock, $0.01 par value, 400,000,000 shares authorized at March 31, 2023 and December 31, 2022; 198,762,220 and 197,776,991 shares issued and 188,234,695 and 187,249,466 shares outstanding (including 20,233 and 422,542 unvested restricted shares), respectively | 1,988 | 1,978 |
Additional paid-in-capital | 4,333,556 | 4,332,302 |
Treasury stock, at cost; 10,527,525 shares at March 31, 2023 and December 31, 2022 | (102,774) | (102,774) |
Accumulated deficit | (3,693,450) | (3,648,901) |
Total Brookdale Senior Living Inc. stockholders' equity | 539,320 | 582,605 |
Noncontrolling interest | 1,534 | 1,548 |
Total equity | 540,854 | 584,153 |
Total liabilities and equity | $ 5,885,859 | $ 5,937,062 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Equity, Number of Shares, Par Value and Other Disclosures [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 198,762,220 | 197,776,991 |
Common stock, shares outstanding (in shares) | 188,234,695 | 187,249,466 |
Treasury stock, shares (in shares) | 10,527,525 | 10,527,525 |
Unvested Restricted Stock | ||
Equity, Number of Shares, Par Value and Other Disclosures [Abstract] | ||
Common stock, shares outstanding (in shares) | 20,233 | 422,542 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue | ||
Revenue | $ 753,263 | $ 677,820 |
Expense | ||
General and administrative expense (including non-cash stock-based compensation expense of $3,104 and $3,885, respectively) | 48,619 | 45,126 |
Facility operating lease expense | 46,127 | 41,564 |
Depreciation and amortization | 84,934 | 85,684 |
Asset impairment | 0 | 9,075 |
Income (loss) from operations | 7,822 | (53,534) |
Interest income | 5,326 | 95 |
Interest expense: | ||
Debt | (50,315) | (33,157) |
Financing lease obligations | (6,552) | (12,058) |
Amortization of deferred financing costs | (1,940) | (1,542) |
Change in fair value of derivatives | (904) | 3,403 |
Equity in earnings (loss) of unconsolidated ventures | (577) | (4,894) |
Non-operating gain (loss) on sale of assets, net | 0 | (294) |
Other non-operating income (loss) | 3,149 | (27) |
Income (loss) before income taxes | (43,991) | (102,008) |
Benefit (provision) for income taxes | (572) | 1,976 |
Net income (loss) | (44,563) | (100,032) |
Net (income) loss attributable to noncontrolling interest | 14 | 19 |
Net income (loss) attributable to Brookdale Senior Living Inc. common stockholders | $ (44,549) | $ (100,013) |
Basic and diluted net income (loss) per share attributable to Brookdale Senior Living Inc. common stockholders | ||
Net income (loss) per share attributable to Brookdale Senior Living Inc. common stockholders - basic (in dollars per share) | $ (0.20) | $ (0.54) |
Net income (loss) per share attributable to Brookdale Senior Living Inc. common stockholders - diluted (in dollars per share) | $ (0.20) | $ (0.54) |
Weighted average shares used in computing basic and diluted net income (loss) per share | ||
Weighted average shares used in computing ,net income (loss) per share - basic (in shares) | 224,578 | 185,916 |
Weighted average shares used in computing, net income (loss) per share - diluted (in shares) | 224,578 | 185,916 |
Resident fees | ||
Revenue | ||
Revenue | $ 713,404 | $ 636,974 |
Management fees | ||
Revenue | ||
Revenue | 2,577 | 3,329 |
Reimbursed costs incurred on behalf of managed communities | ||
Revenue | ||
Revenue | 34,954 | 37,141 |
Expense | ||
Costs incurred | 34,954 | 37,141 |
Other operating income | ||
Revenue | ||
Revenue | 2,328 | 376 |
Facility operating expense | ||
Expense | ||
Costs incurred | $ 530,807 | $ 512,764 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Depreciation and amortization | $ 79,317 | $ 79,932 |
Non-cash stock-based compensation expense | $ 3,104 | $ 3,885 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Common stock: | Additional paid-in-capital: | Treasury stock: | Accumulated deficit: | Noncontrolling interest: |
Balance at beginning of period at Dec. 31, 2021 | $ 699,623 | $ 1,975 | $ 4,208,675 | $ (102,774) | $ (3,410,474) | $ 2,221 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Restricted stock and restricted stock units, net | 9 | (9) | ||||
Shares withheld for employee taxes | (6) | (4,191) | ||||
Compensation expense related to restricted stock grants | 3,885 | |||||
Net income (loss) attributable to Brookdale Senior Living Inc. common stockholders | (100,013) | (100,013) | ||||
Net income (loss) attributable to noncontrolling interest | (100,032) | (19) | ||||
Balance at end of period at Mar. 31, 2022 | 599,279 | $ 1,978 | 4,208,360 | (102,774) | (3,510,487) | 2,202 |
Balance at beginning of period (in shares) at Dec. 31, 2021 | 186,958,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Restricted stock and restricted stock units, net (in shares) | 925,000 | |||||
Shares withheld for employee taxes (in shares) | (600,000) | |||||
Balances at end of period (in shares) at Mar. 31, 2022 | 187,283,000 | |||||
Balance at beginning of period at Dec. 31, 2022 | 584,153 | $ 1,978 | 4,332,302 | (102,774) | (3,648,901) | 1,548 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Restricted stock and restricted stock units, net | 16 | (16) | ||||
Shares withheld for employee taxes | (6) | (1,834) | ||||
Compensation expense related to restricted stock grants | 3,104 | |||||
Net income (loss) attributable to Brookdale Senior Living Inc. common stockholders | (44,549) | (44,549) | ||||
Net income (loss) attributable to noncontrolling interest | (44,563) | (14) | ||||
Balance at end of period at Mar. 31, 2023 | $ 540,854 | $ 1,988 | $ 4,333,556 | $ (102,774) | $ (3,693,450) | $ 1,534 |
Balance at beginning of period (in shares) at Dec. 31, 2022 | 187,249,466 | 187,249,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Restricted stock and restricted stock units, net (in shares) | 1,545,000 | |||||
Shares withheld for employee taxes (in shares) | (559,000) | |||||
Balances at end of period (in shares) at Mar. 31, 2023 | 188,234,695 | 188,235,000 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash Flows from Operating Activities | ||
Net income (loss) attributable to noncontrolling interest | $ (44,563) | $ (100,032) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization, net | 86,874 | 87,226 |
Asset impairment | 0 | 9,075 |
Equity in (earnings) loss of unconsolidated ventures | 577 | 4,894 |
Distributions from unconsolidated ventures from cumulative share of net earnings | 0 | 561 |
Amortization of entrance fees | (508) | (726) |
Proceeds from deferred entrance fee revenue | 324 | 1,036 |
Deferred income tax (benefit) provision | 244 | (2,304) |
Operating lease expense adjustment | (10,805) | (8,307) |
Change in fair value of derivatives | 904 | (3,403) |
Loss (gain) on sale of assets, net | 0 | 294 |
Non-cash stock-based compensation expense | 3,104 | 3,885 |
Property and casualty insurance income | (3,295) | (43) |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 3,143 | 1,185 |
Prepaid expenses and other assets, net | (7,602) | (4,734) |
Prepaid insurance premiums financed with notes payable | (19,305) | (16,629) |
Trade accounts payable and accrued expenses | (1,386) | (2,630) |
Refundable fees and deferred revenue | 14,092 | 5,907 |
Operating lease assets and liabilities for lessor capital expenditure reimbursements | 2,244 | 1,490 |
Net cash provided by (used in) operating activities | 24,042 | (23,255) |
Cash Flows from Investing Activities | ||
Purchase of marketable securities | (49,674) | (125,990) |
Sale and maturities of marketable securities | 30,000 | 129,000 |
Capital expenditures, net of related payables | (49,700) | (39,956) |
Investment in unconsolidated ventures | 0 | (82) |
Proceeds from sale of assets, net | 0 | 710 |
Property and casualty insurance proceeds | 6,422 | 0 |
Other | 933 | 155 |
Net cash provided by (used in) investing activities | (62,019) | (36,163) |
Cash Flows from Financing Activities | ||
Proceeds from debt | 25,519 | 25,258 |
Repayment of debt and financing lease obligations | (23,322) | (21,440) |
Payment of financing costs, net of related payables | (346) | (76) |
Payments of employee taxes for withheld shares | (1,680) | (4,145) |
Net cash provided by (used in) financing activities | 171 | (403) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (37,806) | (59,821) |
Cash, cash equivalents, and restricted cash at beginning of period | 474,548 | 438,314 |
Cash, cash equivalents, and restricted cash at end of period | $ 436,742 | $ 378,493 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | 1. Description of Business Brookdale Senior Living Inc. together with its consolidated subsidiaries ("Brookdale" or the "Company") is an operator of 673 senior living communities throughout the United States. The Company is committed to its mission of enriching the lives of the people it serves with compassion, respect, excellence, and integrity. The Company operates and manages independent living, assisted living, memory care, and continuing care retirement communities ("CCRCs"). The Company's senior living communities and its comprehensive network help to provide seniors with care and services in an environment that feels like home. As of March 31, 2023, the Company owned 346 communities, representing a majority of the Company's community portfolio, leased 295 communities, and managed 32 communities. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q. In the opinion of management, these financial statements include all adjustments, which are of a normal and recurring nature, necessary to present fairly the financial position, results of operations, and cash flows of the Company for all periods presented. Certain information and footnote disclosures included in annual financial statements have been condensed or omitted. The Company believes that the disclosures included are adequate and provide a fair presentation of interim period results. Interim financial statements are not necessarily indicative of the financial position or operating results for an entire year. These interim financial statements should be read in conjunction with the audited financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 filed with the SEC on February 22, 2023. Principles of Consolidation The condensed consolidated financial statements include the accounts of Brookdale and its consolidated subsidiaries. The ownership interest of consolidated entities not wholly-owned by the Company are presented as noncontrolling interests in the accompanying unaudited condensed consolidated financial statements. Intercompany balances and transactions have been eliminated in consolidation, and net income (loss) is reduced by the portion of net income (loss) attributable to noncontrolling interests. The Company reports investments in unconsolidated entities over whose operating and financial policies it has the ability to exercise significant influence under the equity method of accounting. Use of Estimates The preparation of the condensed consolidated financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, revenue, other operating income, asset impairments, self-insurance reserves, performance-based compensation, the allowance for credit losses, depreciation and amortization, leasing transactions, income taxes, and other contingencies. Although these estimates are based on management's best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from the original estimates. Reclassifications Certain prior period amounts have been reclassified to conform to the current financial statement presentation, with no effect on the Company's condensed consolidated financial position or results of operations. |
COVID-19 Pandemic
COVID-19 Pandemic | 3 Months Ended |
Mar. 31, 2023 | |
Unusual or Infrequent Items, or Both [Abstract] | |
COVID-19 Pandemic | 3. COVID-19 Pandemic The COVID-19 pandemic has adversely impacted the Company's occupancy and resident fee revenue beginning in March 2020 and resulted in incremental direct costs to respond to the pandemic. The Company cannot predict with reasonable certainty the impacts that COVID-19 ultimately will have on its business, results of operations, cash flow, and liquidity, and its response efforts may delay or negatively impact its strategic initiatives, including plans for future growth. The ultimate impacts of COVID-19 will depend on many factors, some of which cannot be foreseen, including the duration, severity, and breadth of the pandemic and any resurgence or variants of the disease; the impact of COVID-19 on the nation’s economy and debt and equity markets and the local economies in the Company's markets; the development, availability, utilization, and efficacy of COVID-19 testing, therapeutic agents, and vaccines and the prioritization of such resources among businesses and demographic groups; government financial and regulatory relief efforts that may become available to business and individuals, including the Company's ability to qualify for and satisfy the terms and conditions of financial relief; restrictions on visitors and move-ins at its communities as a result of infections at a community or as necessary to comply with regulatory requirements or at the direction of authorities having jurisdiction; perceptions regarding the safety of senior living communities during and after the pandemic; changes in demand for senior living communities and the Company's ability to adapt its sales and marketing efforts to meet that demand; the impact of COVID-19 on the Company's residents’ and their families’ ability to afford its resident fees, including due to changes in unemployment rates, consumer confidence, housing markets, and equity markets caused by COVID-19; changes in the acuity levels of the Company's new residents; the disproportionate impact of COVID-19 on seniors generally and those residing in the Company's communities; the duration and costs of the Company's response efforts, including increased equipment, supplies, labor, litigation, testing, vaccination clinic, health plan, and other expenses; greater use of contract labor and other premium labor due to COVID-19 and general labor market conditions; the impact of COVID-19 on the Company's ability to complete financings and refinancings of various assets or other transactions or to generate sufficient cash flow to cover required debt, interest, and lease payments and to satisfy financial and other covenants in its debt and lease documents; increased regulatory requirements, including the costs of unfunded, mandatory testing of residents and associates and provision of test kits to the Company's health plan participants; increased enforcement actions resulting from COVID-19; government action that may limit the Company's collection or discharge efforts for delinquent accounts; and the frequency and magnitude of legal actions and liability claims that may arise due to COVID-19 or the Company's response efforts. Employee Retention Credit. The Company was eligible to claim the employee retention credit for certain of its associates under the Coronavirus Aid, Relief, and Economic Security Act of 2020 ("CARES Act") and subsequent legislation. During the years ended December 31, 2022 and 2021, the Company recognized $9.4 million and $9.9 million, respectively, of employee retention credits on wages paid from March 12, 2020 to December 31, 2021 within other operating income, for which the Company has received $9.9 million in cash as of March 31, 2023. The Company has a receivable for the remaining $9.4 million included within prepaid expenses and other current assets, net on the condensed consolidated balance sheet as of March 31, 2023. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 4. Fair Value Measurements Marketable Securities As of March 31, 2023 and December 31, 2022, marketable securities of $69.0 million and $48.7 million, respectively, are stated at fair value based on valuations provided by third-party pricing services and are classified within Level 2 of the valuation hierarchy. Interest Rate Derivatives The Company's derivative assets include interest rate cap and swap instruments that effectively manage the risk above certain interest rates for a portion of the Company's long-term variable rate debt. The Company has not designated the interest rate cap and swap instruments as hedging instruments and as such, changes in the fair value of the instruments are recognized in earnings in the period of the change. The interest rate derivative positions are valued using models developed by the respective counterparty that use as their basis readily available observable market parameters (such as forward yield curves) and are classified within Level 2 of the valuation hierarchy. The Company considers the credit risk of its counterparties when evaluating the fair value of its derivatives. The following table summarizes the Company's London Interbank Offer Rate ("LIBOR") and Secured Overnight Financing Rate ("SOFR") interest rate cap instruments as of March 31, 2023. ($ in thousands) Current notional balance $ 1,231,920 Weighted average fixed cap rate 4.34 % Weighted average remaining term 1.1 years Estimated asset fair value (included in other assets, net) at March 31, 2023 $ 9,125 Estimated asset fair value (included in other assets, net) at December 31, 2022 $ 10,599 The following table summarizes the Company's SOFR interest rate swap instrument as of March 31, 2023. ($ in thousands) Current notional balance $ 220,000 Fixed interest rate 3.00 % Remaining term 1.1 years Estimated asset fair value (included in other assets, net) at March 31, 2023 $ 3,692 Estimated asset fair value (included in other assets, net) at December 31, 2022 $ 4,834 Long-term debt The Company estimates the fair value of its debt primarily using a discounted cash flow analysis based upon the Company's current borrowing rate for debt with similar maturities and collateral securing the indebtedness. The Company estimates the fair value of its convertible senior notes based on valuations provided by third-party pricing services. The Company had outstanding long-term debt with a carrying amount of approximately $3.9 billion as of both March 31, 2023 and December 31, 2022. Fair value of the long-term debt is approximately $3.4 billion as of both March 31, 2023 and December 31, 2022. The Company's fair value of long-term debt disclosure is classified within Level 2 of the valuation hierarchy. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 5. RevenueFor the three months ended March 31, 2023 and 2022, the Company generated 93.6% and 93.4%, respectively, of its resident fee revenue from private pay customers and the remainder from government reimbursement programs and other payor sources. Refer to Note 15 for disaggregation of revenue by reportable segment.The payment terms and conditions within the Company's revenue-generating contracts vary by contract type and payor source, although terms generally include payment to be made within 30 days. Resident fee revenue for recurring and routine monthly services is generally billed monthly in advance under the Company's independent living, assisted living, and memory care residency agreements. Resident fee revenue for standalone or certain healthcare services is generally billed monthly in arrears. Additionally, non-refundable community fees are generally billed and collected in advance or upon move-in of a resident under the Company's independent living, assisted living, and memory care residency agreements. Amounts of revenue that are collected from residents in advance are recognized as deferred revenue until the performance obligations are satisfied. The Company had total deferred revenue (included within refundable fees and deferred revenue, liabilities held for sale, and other liabilities within the condensed consolidated balance sheets) of $80.9 million and $67.3 million, including $35.3 million and $25.2 million of monthly resident fees billed and received in advance, as of March 31, 2023 and December 31, 2022, respectively. For the three months ended March 31, 2023 and 2022, the Company recognized $36.9 million and $40.1 million, respectively, of revenue that was included in the deferred revenue balance as of January 1, 2023 and 2022, respectively. |
Property, Plant and Equipment a
Property, Plant and Equipment and Leasehold Intangibles, Net | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment and Leasehold Intangibles, Net | 6. Property, Plant and Equipment and Leasehold Intangibles, Net As of March 31, 2023 and December 31, 2022, net property, plant and equipment and leasehold intangibles, which include assets under financing leases, consisted of the following. (in thousands) March 31, 2023 December 31, 2022 Land $ 503,488 $ 506,968 Buildings and improvements 5,309,368 5,323,736 Furniture and equipment 1,061,777 1,055,304 Resident and leasehold operating intangibles 283,232 286,122 Construction in progress 54,315 41,778 Assets under financing leases and leasehold improvements 1,395,000 1,375,521 Property, plant and equipment and leasehold intangibles 8,607,180 8,589,429 Accumulated depreciation and amortization (4,114,178) (4,053,727) Property, plant and equipment and leasehold intangibles, net $ 4,493,002 $ 4,535,702 Assets under financing leases and leasehold improvements includes $93.2 million and $98.4 million of financing lease right-of-use assets, net of accumulated amortization, as of March 31, 2023 and December 31, 2022, respectively. Refer to Note 8 for further information on the Company's financing leases. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | 7. Debt Long-term debt consists of the following. (in thousands) March 31, 2023 December 31, 2022 Fixed rate mortgage notes payable due 2024 through 2047; weighted average interest rate of 4.14% as of both March 31, 2023 and December 31, 2022 $ 2,050,914 $ 2,055,867 Variable rate mortgage notes payable due 2023 through 2030; weighted average interest rate of 7.15% and 6.68% as of March 31, 2023 and December 31, 2022, respectively 1,565,259 1,568,555 Convertible notes payable due October 2026; interest rate of 2.00% as of both March 31, 2023 and December 31, 2022 230,000 230,000 Tangible equity units senior amortizing notes due November 2025; interest rate of 10.25% as of both March 31, 2023 and December 31, 2022 23,850 25,586 Other notes payable due 2023; interest rate of 5.90% as of March 31, 2023 18,033 — Deferred financing costs, net (28,091) (29,866) Total long-term debt 3,859,965 3,850,142 Current portion 87,711 66,043 Total long-term debt, less current portion $ 3,772,254 $ 3,784,099 As of March 31, 2023, 91.6%, or $3.5 billion, of the Company's total debt obligations represented non-recourse property-level mortgage financings. As of March 31, 2023, $72.6 million of letters of credit and no cash borrowings were outstanding under the Company's $80.0 million secured credit facility maturing January 2024. The Company also had a separate secured letter of credit facility providing up to $15.0 million of letters of credit as of March 31, 2023 under which $13.9 million had been issued as of that date. Financial Covenants Certain of the Company's debt documents contain restrictions and financial covenants, such as those requiring the Company to maintain prescribed minimum liquidity, net worth, and stockholders' equity levels and debt service ratios, and requiring the Company not to exceed prescribed leverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community, and/or entity basis. In addition, the Company's debt documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements and maintain insurance coverage. The Company's failure to comply with applicable covenants could constitute an event of default under the applicable debt documents. Many of the Company's debt documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Furthermore, the Company's debt is secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries. As of March 31, 2023, the Company is in compliance with the financial covenants of its debt agreements. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Leases | 8. Leases As of March 31, 2023, the Company operated 295 communities under long-term leases (246 operating leases and 49 financing leases). The substantial majority of the Company's lease arrangements are structured as master leases. Under a master lease, numerous communities are leased through an indivisible lease. The Company typically guarantees the performance and lease payment obligations of its subsidiary lessees under the master leases. An event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio. The leases relating to these communities are generally fixed rate leases with annual escalators that are either fixed or based upon changes in the consumer price index or the leased property revenue. The Company is responsible for all operating costs, including repairs, property taxes, and insurance. The leases generally provide for renewal or extension options from 5 to 20 years and in some instances, purchase options. The community leases contain other customary terms, which may include assignment and change of control restrictions, maintenance and capital expenditure obligations, termination provisions and financial covenants, such as those requiring the Company to maintain prescribed minimum liquidity, net worth, and stockholders' equity levels and lease coverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community and/or entity basis. In addition, the Company's lease documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements and maintain insurance coverage. The Company's failure to comply with applicable covenants could constitute an event of default under the applicable lease documents. Many of the Company's debt and lease documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Certain leases contain cure provisions, which generally allow the Company to post an additional lease security deposit if the required covenant is not met. Furthermore, the Company's leases are secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries. As of March 31, 2023, the Company is in compliance with the financial covenants of its long-term leases. A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and net cash outflows from leases is as follows. Three Months Ended Operating Leases (in thousands) 2023 2022 Facility operating expense $ 1,626 $ 1,523 Facility lease expense 46,127 41,564 Operating lease expense 47,753 43,087 Operating lease expense adjustment (1) 10,805 8,307 Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements (2,244) (1,490) Operating net cash outflows from operating leases $ 56,314 $ 49,904 (1) Represents the difference between the amount of cash operating lease payments and the amount of operating lease expense. Three Months Ended Financing Leases (in thousands) 2023 2022 Depreciation and amortization $ 5,228 $ 7,665 Interest expense: financing lease obligations 6,552 12,058 Financing lease expense $ 11,780 $ 19,723 Operating cash outflows from financing leases $ 6,552 $ 12,058 Financing cash outflows from financing leases 5,852 5,490 Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement — (3,207) Total net cash outflows from financing leases $ 12,404 $ 14,341 The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2023 are as follows (in thousands). Year Ending December 31, Operating Leases Financing Leases 2023 (nine months) $ 174,844 $ 36,463 2024 218,481 49,309 2025 216,638 37,189 2026 101,785 37,894 2027 98,606 5,861 Thereafter 135,448 24,174 Total lease payments 945,802 190,890 Purchase option liability and non-cash gain on future sale of property — 135,751 Imputed interest and variable lease payments (192,305) (83,609) Total lease obligations $ 753,497 $ 243,032 |
Leases | 8. Leases As of March 31, 2023, the Company operated 295 communities under long-term leases (246 operating leases and 49 financing leases). The substantial majority of the Company's lease arrangements are structured as master leases. Under a master lease, numerous communities are leased through an indivisible lease. The Company typically guarantees the performance and lease payment obligations of its subsidiary lessees under the master leases. An event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio. The leases relating to these communities are generally fixed rate leases with annual escalators that are either fixed or based upon changes in the consumer price index or the leased property revenue. The Company is responsible for all operating costs, including repairs, property taxes, and insurance. The leases generally provide for renewal or extension options from 5 to 20 years and in some instances, purchase options. The community leases contain other customary terms, which may include assignment and change of control restrictions, maintenance and capital expenditure obligations, termination provisions and financial covenants, such as those requiring the Company to maintain prescribed minimum liquidity, net worth, and stockholders' equity levels and lease coverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community and/or entity basis. In addition, the Company's lease documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements and maintain insurance coverage. The Company's failure to comply with applicable covenants could constitute an event of default under the applicable lease documents. Many of the Company's debt and lease documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Certain leases contain cure provisions, which generally allow the Company to post an additional lease security deposit if the required covenant is not met. Furthermore, the Company's leases are secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries. As of March 31, 2023, the Company is in compliance with the financial covenants of its long-term leases. A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and net cash outflows from leases is as follows. Three Months Ended Operating Leases (in thousands) 2023 2022 Facility operating expense $ 1,626 $ 1,523 Facility lease expense 46,127 41,564 Operating lease expense 47,753 43,087 Operating lease expense adjustment (1) 10,805 8,307 Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements (2,244) (1,490) Operating net cash outflows from operating leases $ 56,314 $ 49,904 (1) Represents the difference between the amount of cash operating lease payments and the amount of operating lease expense. Three Months Ended Financing Leases (in thousands) 2023 2022 Depreciation and amortization $ 5,228 $ 7,665 Interest expense: financing lease obligations 6,552 12,058 Financing lease expense $ 11,780 $ 19,723 Operating cash outflows from financing leases $ 6,552 $ 12,058 Financing cash outflows from financing leases 5,852 5,490 Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement — (3,207) Total net cash outflows from financing leases $ 12,404 $ 14,341 The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2023 are as follows (in thousands). Year Ending December 31, Operating Leases Financing Leases 2023 (nine months) $ 174,844 $ 36,463 2024 218,481 49,309 2025 216,638 37,189 2026 101,785 37,894 2027 98,606 5,861 Thereafter 135,448 24,174 Total lease payments 945,802 190,890 Purchase option liability and non-cash gain on future sale of property — 135,751 Imputed interest and variable lease payments (192,305) (83,609) Total lease obligations $ 753,497 $ 243,032 |
Investment in Unconsolidated Ve
Investment in Unconsolidated Ventures | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Investment in Unconsolidated Ventures | 9. Investment in Unconsolidated Ventures As of March 31, 2023, the Company owns a 20% equity interest, and affiliates of HCA Healthcare Inc. own an 80% interest, in a health care services venture (the "HCS Venture"), which operates home health and hospice agencies in the United States. The Company's interest in the HCS Venture is accounted for under the equity method of accounting. The carrying amount of the Company's investment in the unconsolidated venture and maximum exposure to loss as a result of the Company's ownership interest in the HCS Venture is $49.1 million, which is included in investment in unconsolidated ventures on the accompanying unaudited condensed consolidated balance sheet as of March 31, 2023. As of March 31, 2023, the Company is not required to provide financial support, through a liquidity arrangement or otherwise, to the HCS Venture. |
Litigation
Litigation | 3 Months Ended |
Mar. 31, 2023 | |
Litigation [Abstract] | |
Litigation | 10. Litigation The Company has been and is currently involved in litigation and claims incidental to the conduct of its business, which it believes are generally comparable to other companies in the senior living and healthcare industries, including, but not limited to, putative class action claims from time to time regarding staffing at the Company's communities and compliance with consumer protection laws and the Americans with Disabilities Act. Certain claims and lawsuits allege large damage amounts and may require significant costs to defend and resolve. As a result, the Company maintains general liability, professional liability, and other insurance policies in amounts and with coverage and deductibles the Company believes are appropriate, based on the nature and risks of its business, historical experience, availability, and industry standards. The Company's current policies provide for deductibles for each claim and contain various exclusions from coverage. The Company uses its wholly-owned captive insurance company for the purpose of insuring certain portions of its risk retention under its general and professional liability insurance programs. Accordingly, the Company is, in effect, self-insured for claims that are less than the deductible amounts, for claims that exceed the funding level of the Company's wholly-owned captive insurance company, and for claims or portions of claims that are not covered by such policies and/or exceed the policy limits. The senior living and healthcare industries are continuously subject to scrutiny by governmental regulators, which could result in reviews, audits, investigations, enforcement actions, or litigation related to regulatory compliance matters. In addition, the Company is subject to various government reviews, audits, and investigations to verify compliance with Medicare and Medicaid programs and other applicable laws and regulations. The Centers for Medicare & Medicaid Services has engaged third-party firms to review claims data to evaluate appropriateness of billings. In addition to identifying overpayments, audit contractors can refer suspected violations to government authorities. In addition, states' Attorneys General vigorously enforce consumer protection laws as those laws relate to the senior living industry. An adverse outcome of government scrutiny may result in citations, sanctions, other criminal or civil fines and penalties, the refund of overpayments, payment suspensions, termination of participation in Medicare and Medicaid programs, and damage to the Company's business reputation. The Company's costs to respond to and defend any such audits, reviews, and investigations may be significant. In June 2020, the Company and several current and former executive officers were named as defendants in a putative class action lawsuit alleging violations of the federal securities laws filed in the federal court for the Middle District of Tennessee. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 11. Stock-Based Compensation Grants of restricted stock units and stock awards under the Company's 2014 Omnibus Incentive Plan were as follows. (in thousands, except weighted average amounts) Restricted Stock Unit and Stock Award Grants Weighted Average Grant Date Fair Value Total Grant Date Fair Value Three months ended March 31, 2023 3,959 $ 2.97 $ 11,778 |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 12. Earnings Per Share Potentially dilutive common stock equivalents for the Company include convertible senior notes, warrants, unvested restricted stock, restricted stock units, and prepaid stock purchase contracts. On October 1, 2021, the Company issued $230.0 million principal amount of 2.00% convertible senior notes due 2026 (the "Notes"). As of March 31, 2023, the maximum number of shares issuable upon settlement of the Notes is 38.3 million (after giving effect to additional shares that would be issuable upon conversion in connection with the occurrence of certain corporate or other events). On July 26, 2020, the Company issued to Ventas, Inc. ("Ventas") a warrant (the "Warrant") to purchase 16.3 million shares of the Company’s common stock, $0.01 par value per share, at a price per share of $3.00. The Warrant is exercisable at Ventas' option at any time and from time to time, in whole or in part, until December 31, 2025. The exercise price and the number of shares issuable on exercise of the Warrant are subject to certain anti-dilution adjustments, including for cash dividends, stock dividends, stock splits, reclassifications, non-cash distributions, certain repurchases of common stock, and business combination transactions. During the three months ended December 31, 2022, the Company issued 2,875,000 of its 7.00% tangible equity units (the “Units”) at a public offering price of $50.00 per Unit for an aggregate offering of $143.8 million. The Company received proceeds of $139.4 million after the deduction of the underwriters’ discount. Each Unit is comprised of a prepaid stock purchase contract and a senior amortizing note with an initial principal amount of $8.8996. Unless settled early in accordance with the terms of the instruments, under each purchase contract, the Company is obligated to deliver to the holder on November 15, 2025 a minimum of 12.9341, and a maximum of 15.1976, shares of the Company’s common stock depending on the daily volume-weighted average price ("VWAPs") of its common stock for the 20 trading days preceding the settlement date. As of March 31, 2023, the maximum number of shares issuable upon settlement of the Units' prepaid stock purchase contracts is 43.7 million. Basic earnings per share ("EPS") is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding, after giving effect to the minimum number of shares issuable upon settlement of the prepaid stock purchase contract component of the Units. For the three months ended March 31, 2023, 37.2 million shares are included in weighted average basic shares outstanding for the minimum number of shares issuable upon settlement of the Units' prepaid stock purchase contracts. Three Months Ended March 31, 2023 2022 Weighted average common shares outstanding 187,392 185,916 Weighted average minimum shares issuable under purchase contracts 37,186 — Weighted average shares outstanding - basic 224,578 185,916 Diluted EPS includes the components of basic EPS and also gives effect to dilutive common stock equivalents. Diluted EPS reflects the potential dilution that could occur if securities or other instruments that are convertible into common stock were exercised or could result in the issuance of common stock. For the purposes of computing diluted EPS, weighted average shares outstanding do not include potentially dilutive securities that are anti-dilutive under the treasury stock method or if-converted method, and performance-based equity awards are included based on the attainment of the applicable performance metrics as of the end of the reporting period. The Company has the following potentially outstanding shares of common stock, which were excluded from the computation of diluted net income (loss) per share attributable to common stockholders in both periods as a result of the net loss. As of March 31, (in millions) 2023 2022 Convertible senior notes 38.3 38.3 Warrants 16.3 16.3 Restricted stock and restricted stock units 6.6 5.7 Incremental shares issuable under purchase contracts 6.5 — Total 67.7 60.3 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. Income Taxes The difference between the Company's effective tax rate for the three months ended March 31, 2023 and 2022 was primarily due to an increase in the valuation allowance recorded during the three months ended March 31, 2023, as well as a decrease in the tax benefit on the vesting of restricted stock units and restricted stock awards due to a lower market price for the Company’s stock for the three months ended March 31, 2023 as compared to the three months ended March 31, 2022. The Company recorded an aggregate deferred federal, state, and local tax benefit of $9.4 million for the three months ended March 31, 2023, which was offset by an increase to the valuation allowance of $9.7 million. The Company recorded an aggregate deferred federal, state, and local tax expense of $24.9 million for the three months ended March 31, 2022, which was partially offset by a reduction to the valuation allowance of $22.6 million. The Company evaluates its deferred tax assets each quarter to determine if a valuation allowance is required based on whether it is more likely than not that some portion of the deferred tax asset would not be realized. The Company's valuation allowance as of March 31, 2023 and December 31, 2022 was $434.7 million and $425.0 million, respectively. The increase in the valuation allowance for the three months ended March 31, 2023 and 2022 is the result of current operating losses during the three months ended March 31, 2023 and 2022 and by the anticipated reversal of future tax liabilities offset by future tax deductions. |
Supplemental Disclosure of Cash
Supplemental Disclosure of Cash Flow Information | 3 Months Ended |
Mar. 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosure of Cash Flow Information | 14. Supplemental Disclosure of Cash Flow Information During the period from January 1, 2022 through March 31, 2023, the Company disposed of two owned communities and the Company's triple-net lease obligations on four communities were terminated (including through the acquisition of one formerly leased community). The Company completed the sale of its one remaining entrance fee community on May 1, 2023. The Company received cash proceeds of $12.3 million, net of $29.6 million in mortgage debt repaid and transaction costs, at closing. As of March 31, 2023, the community was classified as held for sale in the CCRCs segment, resulting in $23.6 million being recorded as assets held for sale and $19.5 million, representing primarily refundable fees and deferred revenue from entrance fee residency agreements, recorded as liabilities held for sale within the condensed consolidated balance sheets. Three Months Ended (in thousands) 2023 2022 Supplemental Disclosure of Cash Flow Information: Interest paid $ 55,110 $ 43,927 Income taxes paid, net of refunds $ (1,346) $ 341 Capital expenditures, net of related payables: Capital expenditures - non-development, net $ 62,912 $ 39,326 Capital expenditures - development, net 519 861 Capital expenditures - non-development - reimbursable 2,244 4,697 Trade accounts payable (15,975) (4,928) Net cash paid $ 49,700 $ 39,956 Supplemental Schedule of Non-cash Operating, Investing, and Financing Activities: Assets designated as held for sale: Assets held for sale $ 23,555 $ — Property, plant and equipment and leasehold intangibles, net (23,555) — Liabilities held for sale (19,455) — Refundable fees and deferred revenue 9,362 — Other liabilities 10,093 — Net $ — $ — Restricted cash consists principally of deposits as security for self-insured retention risk under workers' compensation programs and property insurance programs, escrow deposits for real estate taxes, property insurance, and capital expenditures, and debt service reserve accounts required by certain lenders under mortgage debt agreements. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sums to the total of the same such amounts shown in the condensed consolidated statements of cash flows. (in thousands) March 31, 2023 December 31, 2022 Reconciliation of cash, cash equivalents, and restricted cash: Cash and cash equivalents $ 362,235 $ 398,850 Restricted cash 29,374 27,735 Long-term restricted cash 45,133 47,963 Total cash, cash equivalents, and restricted cash $ 436,742 $ 474,548 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | 15. Segment Information As of March 31, 2023, the Company has three reportable segments: Independent Living; Assisted Living and Memory Care; and CCRCs. Operating segments are defined as components of an enterprise that engage in business activities from which it may earn revenues and incur expenses; for which separate financial information is available; and whose operating results are regularly reviewed by the chief operating decision maker to assess the performance of the individual segment and make decisions about resources to be allocated to the segment. Independent Living . The Company's Independent Living segment includes owned or leased communities that are primarily designed for middle to upper income seniors who desire to live in a residential setting that feels like home, without the efforts of ownership. The majority of the Company's independent living communities consist of both independent and assisted living units in a single community, which allows residents to age-in-place by providing them with a broad continuum of senior independent and assisted living services to accommodate their changing needs. Assisted Living and Memory Care. The Company's Assisted Living and Memory Care segment includes owned or leased communities that offer housing and 24-hour assistance with activities of daily living for the Company's residents. The Company's assisted living and memory care communities include both freestanding, multi-story communities, as well as smaller, freestanding, single story communities. The Company also provides memory care services at freestanding memory care communities that are specially designed for residents with Alzheimer's disease and other dementias. CCRCs. The Company's CCRCs segment includes large owned or leased communities that offer a variety of living arrangements and services to accommodate a broad spectrum of physical ability and healthcare needs. Most of the Company's CCRCs have independent living, assisted living, memory care, and skilled nursing available on one campus. All Other. All Other includes communities operated by the Company pursuant to management agreements. Under the management agreements for these communities, the Company receives management fees as well as reimbursement of expenses it incurs on behalf of the owners. The following tables set forth selected segment financial data. Three Months Ended (in thousands) 2023 2022 Revenue and other operating income: Independent Living (1) $ 140,656 $ 124,406 Assisted Living and Memory Care (1) 488,804 432,488 CCRCs (1) 86,272 80,456 All Other 37,531 40,470 Total revenue and other operating income $ 753,263 $ 677,820 Three Months Ended (in thousands) 2022 2021 Segment operating income: (2) Independent Living $ 46,833 $ 37,684 Assisted Living and Memory Care 124,593 76,863 CCRCs 13,499 10,039 All Other 2,577 3,329 Total segment operating income 187,502 127,915 General and administrative expense (including non-cash stock-based compensation expense) 48,619 45,126 Facility operating lease expense 46,127 41,564 Depreciation and amortization 84,934 85,684 Asset impairment — 9,075 Income (loss) from operations $ 7,822 $ (53,534) As of (in thousands) March 31, 2023 December 31, 2022 Total assets: Independent Living (3) $ 1,253,570 $ 1,267,825 Assisted Living and Memory Care 3,288,702 3,329,516 CCRCs 666,102 664,502 Corporate and All Other 677,485 675,219 Total assets $ 5,885,859 $ 5,937,062 (1) All revenue and other operating income is earned from external third parties in the United States. (3) The Company's Independent Living segment had a carrying amount of goodwill of $27.3 million as of both March 31, 2023 and December 31, 2022. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q. In the opinion of management, these financial statements include all adjustments, which are of a normal and recurring nature, necessary to present fairly the financial position, results of operations, and cash flows of the Company for all periods presented. Certain information and footnote disclosures included in annual financial statements have been condensed or omitted. The Company believes that the disclosures included are adequate and provide a fair presentation of interim period results. Interim financial statements are not necessarily indicative of the financial position or operating results for an entire year. These interim financial statements should be read in conjunction with the audited financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 filed with the SEC on February 22, 2023. |
Principles of Consolidation | Principles of ConsolidationThe condensed consolidated financial statements include the accounts of Brookdale and its consolidated subsidiaries. The ownership interest of consolidated entities not wholly-owned by the Company are presented as noncontrolling interests in the accompanying unaudited condensed consolidated financial statements. Intercompany balances and transactions have been eliminated in consolidation, and net income (loss) is reduced by the portion of net income (loss) attributable to noncontrolling interests. The Company reports investments in unconsolidated entities over whose operating and financial policies it has the ability to exercise significant influence under the equity method of accounting. |
Use of Estimates | Use of EstimatesThe preparation of the condensed consolidated financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, revenue, other operating income, asset impairments, self-insurance reserves, performance-based compensation, the allowance for credit losses, depreciation and amortization, leasing transactions, income taxes, and other contingencies. Although these estimates are based on management's best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from the original estimates. |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to the current financial statement presentation, with no effect on the Company's condensed consolidated financial position or results of operations. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Interest Rate Caps | The following table summarizes the Company's London Interbank Offer Rate ("LIBOR") and Secured Overnight Financing Rate ("SOFR") interest rate cap instruments as of March 31, 2023. ($ in thousands) Current notional balance $ 1,231,920 Weighted average fixed cap rate 4.34 % Weighted average remaining term 1.1 years Estimated asset fair value (included in other assets, net) at March 31, 2023 $ 9,125 Estimated asset fair value (included in other assets, net) at December 31, 2022 $ 10,599 The following table summarizes the Company's SOFR interest rate swap instrument as of March 31, 2023. ($ in thousands) Current notional balance $ 220,000 Fixed interest rate 3.00 % Remaining term 1.1 years Estimated asset fair value (included in other assets, net) at March 31, 2023 $ 3,692 Estimated asset fair value (included in other assets, net) at December 31, 2022 $ 4,834 |
Property, Plant and Equipment_2
Property, Plant and Equipment and Leasehold Intangibles, Net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment and Leasehold Intangibles, Net | As of March 31, 2023 and December 31, 2022, net property, plant and equipment and leasehold intangibles, which include assets under financing leases, consisted of the following. (in thousands) March 31, 2023 December 31, 2022 Land $ 503,488 $ 506,968 Buildings and improvements 5,309,368 5,323,736 Furniture and equipment 1,061,777 1,055,304 Resident and leasehold operating intangibles 283,232 286,122 Construction in progress 54,315 41,778 Assets under financing leases and leasehold improvements 1,395,000 1,375,521 Property, plant and equipment and leasehold intangibles 8,607,180 8,589,429 Accumulated depreciation and amortization (4,114,178) (4,053,727) Property, plant and equipment and leasehold intangibles, net $ 4,493,002 $ 4,535,702 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Long-term debt consists of the following. (in thousands) March 31, 2023 December 31, 2022 Fixed rate mortgage notes payable due 2024 through 2047; weighted average interest rate of 4.14% as of both March 31, 2023 and December 31, 2022 $ 2,050,914 $ 2,055,867 Variable rate mortgage notes payable due 2023 through 2030; weighted average interest rate of 7.15% and 6.68% as of March 31, 2023 and December 31, 2022, respectively 1,565,259 1,568,555 Convertible notes payable due October 2026; interest rate of 2.00% as of both March 31, 2023 and December 31, 2022 230,000 230,000 Tangible equity units senior amortizing notes due November 2025; interest rate of 10.25% as of both March 31, 2023 and December 31, 2022 23,850 25,586 Other notes payable due 2023; interest rate of 5.90% as of March 31, 2023 18,033 — Deferred financing costs, net (28,091) (29,866) Total long-term debt 3,859,965 3,850,142 Current portion 87,711 66,043 Total long-term debt, less current portion $ 3,772,254 $ 3,784,099 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Schedule of Lease Costs | A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and net cash outflows from leases is as follows. Three Months Ended Operating Leases (in thousands) 2023 2022 Facility operating expense $ 1,626 $ 1,523 Facility lease expense 46,127 41,564 Operating lease expense 47,753 43,087 Operating lease expense adjustment (1) 10,805 8,307 Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements (2,244) (1,490) Operating net cash outflows from operating leases $ 56,314 $ 49,904 (1) Represents the difference between the amount of cash operating lease payments and the amount of operating lease expense. Three Months Ended Financing Leases (in thousands) 2023 2022 Depreciation and amortization $ 5,228 $ 7,665 Interest expense: financing lease obligations 6,552 12,058 Financing lease expense $ 11,780 $ 19,723 Operating cash outflows from financing leases $ 6,552 $ 12,058 Financing cash outflows from financing leases 5,852 5,490 Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement — (3,207) Total net cash outflows from financing leases $ 12,404 $ 14,341 |
Schedule of Finance Lease, Liability, Maturity | The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2023 are as follows (in thousands). Year Ending December 31, Operating Leases Financing Leases 2023 (nine months) $ 174,844 $ 36,463 2024 218,481 49,309 2025 216,638 37,189 2026 101,785 37,894 2027 98,606 5,861 Thereafter 135,448 24,174 Total lease payments 945,802 190,890 Purchase option liability and non-cash gain on future sale of property — 135,751 Imputed interest and variable lease payments (192,305) (83,609) Total lease obligations $ 753,497 $ 243,032 |
Schedule of Lessee, Operating Lease, Liability, Maturity | The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2023 are as follows (in thousands). Year Ending December 31, Operating Leases Financing Leases 2023 (nine months) $ 174,844 $ 36,463 2024 218,481 49,309 2025 216,638 37,189 2026 101,785 37,894 2027 98,606 5,861 Thereafter 135,448 24,174 Total lease payments 945,802 190,890 Purchase option liability and non-cash gain on future sale of property — 135,751 Imputed interest and variable lease payments (192,305) (83,609) Total lease obligations $ 753,497 $ 243,032 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Grants of Restricted Stock and Restricted Stock Units | Grants of restricted stock units and stock awards under the Company's 2014 Omnibus Incentive Plan were as follows. (in thousands, except weighted average amounts) Restricted Stock Unit and Stock Award Grants Weighted Average Grant Date Fair Value Total Grant Date Fair Value Three months ended March 31, 2023 3,959 $ 2.97 $ 11,778 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic, by Common Class, Including Two Class Method | Three Months Ended March 31, 2023 2022 Weighted average common shares outstanding 187,392 185,916 Weighted average minimum shares issuable under purchase contracts 37,186 — Weighted average shares outstanding - basic 224,578 185,916 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The Company has the following potentially outstanding shares of common stock, which were excluded from the computation of diluted net income (loss) per share attributable to common stockholders in both periods as a result of the net loss. As of March 31, (in millions) 2023 2022 Convertible senior notes 38.3 38.3 Warrants 16.3 16.3 Restricted stock and restricted stock units 6.6 5.7 Incremental shares issuable under purchase contracts 6.5 — Total 67.7 60.3 |
Supplemental Disclosure of Ca_2
Supplemental Disclosure of Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | Three Months Ended (in thousands) 2023 2022 Supplemental Disclosure of Cash Flow Information: Interest paid $ 55,110 $ 43,927 Income taxes paid, net of refunds $ (1,346) $ 341 Capital expenditures, net of related payables: Capital expenditures - non-development, net $ 62,912 $ 39,326 Capital expenditures - development, net 519 861 Capital expenditures - non-development - reimbursable 2,244 4,697 Trade accounts payable (15,975) (4,928) Net cash paid $ 49,700 $ 39,956 Supplemental Schedule of Non-cash Operating, Investing, and Financing Activities: Assets designated as held for sale: Assets held for sale $ 23,555 $ — Property, plant and equipment and leasehold intangibles, net (23,555) — Liabilities held for sale (19,455) — Refundable fees and deferred revenue 9,362 — Other liabilities 10,093 — Net $ — $ — |
Schedule of Cash, Cash Equivalents, and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sums to the total of the same such amounts shown in the condensed consolidated statements of cash flows. (in thousands) March 31, 2023 December 31, 2022 Reconciliation of cash, cash equivalents, and restricted cash: Cash and cash equivalents $ 362,235 $ 398,850 Restricted cash 29,374 27,735 Long-term restricted cash 45,133 47,963 Total cash, cash equivalents, and restricted cash $ 436,742 $ 474,548 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The following tables set forth selected segment financial data. Three Months Ended (in thousands) 2023 2022 Revenue and other operating income: Independent Living (1) $ 140,656 $ 124,406 Assisted Living and Memory Care (1) 488,804 432,488 CCRCs (1) 86,272 80,456 All Other 37,531 40,470 Total revenue and other operating income $ 753,263 $ 677,820 Three Months Ended (in thousands) 2022 2021 Segment operating income: (2) Independent Living $ 46,833 $ 37,684 Assisted Living and Memory Care 124,593 76,863 CCRCs 13,499 10,039 All Other 2,577 3,329 Total segment operating income 187,502 127,915 General and administrative expense (including non-cash stock-based compensation expense) 48,619 45,126 Facility operating lease expense 46,127 41,564 Depreciation and amortization 84,934 85,684 Asset impairment — 9,075 Income (loss) from operations $ 7,822 $ (53,534) As of (in thousands) March 31, 2023 December 31, 2022 Total assets: Independent Living (3) $ 1,253,570 $ 1,267,825 Assisted Living and Memory Care 3,288,702 3,329,516 CCRCs 666,102 664,502 Corporate and All Other 677,485 675,219 Total assets $ 5,885,859 $ 5,937,062 (1) All revenue and other operating income is earned from external third parties in the United States. (3) The Company's Independent Living segment had a carrying amount of goodwill of $27.3 million as of both March 31, 2023 and December 31, 2022. |
Description of Business (Detail
Description of Business (Details) | Mar. 31, 2023 community |
Segment Reporting Information [Line Items] | |
Operating and financing leases, number of communities | 295 |
Current Property Ownership Status | |
Segment Reporting Information [Line Items] | |
Number of senior living communities | 673 |
Number of communities owned | 346 |
Operating and financing leases, number of communities | 295 |
Number of communities managed by third party | 32 |
COVID-19 Pandemic (Details)
COVID-19 Pandemic (Details) - CARES Act - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Unusual or Infrequent Item, or Both [Line Items] | |||
Employee retention credit, amount recognized | $ 9.4 | $ 9.9 | |
Employee retention credit, amount received | $ 9.9 | ||
Prepaid Expenses and Other Current Assets | |||
Unusual or Infrequent Item, or Both [Line Items] | |||
Employee related liabilities | $ 9.4 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 69,009 | $ 48,680 |
Total long-term debt | 3,859,965 | 3,850,142 |
Long-term debt, fair value | 3,400,000 | 3,400,000 |
Long-term debt and lines of credit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total long-term debt | 3,900,000 | 3,900,000 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 69,000 | $ 48,700 |
Fair Value Measurements - Inter
Fair Value Measurements - Interest Rate Caps (Details) - Level 2 - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Interest Rate Cap | ||
Derivative [Line Items] | ||
Derivative asset, notional amount | $ 1,231,920 | |
Weighted average fixed cap rate | 4.34% | |
Weighted average remaining term | 1 year 1 month 6 days | |
Estimated asset fair value (included in other assets, net) | $ 9,125 | $ 10,599 |
Interest Rate Swap | ||
Derivative [Line Items] | ||
Derivative asset, notional amount | 220,000 | |
Estimated asset fair value (included in other assets, net) | $ 3,692 | $ 4,834 |
Fixed interest rate | 3% | |
Remaining term | 1 year 1 month 6 days |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Disaggregation of Revenue [Line Items] | |||
Monthly resident fees | $ 35.3 | $ 25.2 | |
Revenue recognized | 36.9 | $ 40.1 | |
Deferred Revenue and Credits | |||
Disaggregation of Revenue [Line Items] | |||
Contract with customer, liability | $ 80.9 | $ 67.3 | |
Private pay | Revenue Benchmark | Customer Concentration Risk | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk, percentage | 93.60% | 93.40% |
Property, Plant and Equipment_3
Property, Plant and Equipment and Leasehold Intangibles, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | $ 8,607,180 | $ 8,589,429 | |
Accumulated depreciation and amortization | (4,114,178) | (4,053,727) | |
Property, plant and equipment and leasehold intangibles, net | 4,493,002 | 4,535,702 | |
Finance lease, right-of-use asset | 93,200 | 98,400 | |
Depreciation and amortization expense | 84,900 | $ 85,700 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 503,488 | 506,968 | |
Buildings and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 5,309,368 | 5,323,736 | |
Furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 1,061,777 | 1,055,304 | |
Resident and leasehold operating intangibles | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 283,232 | 286,122 | |
Construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 54,315 | 41,778 | |
Assets under financing leases and leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | $ 1,395,000 | $ 1,375,521 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 3,859,965 | $ 3,850,142 |
Deferred financing costs, net | (28,091) | (29,866) |
Current portion | 87,711 | 66,043 |
Long-term debt, less current portion | 3,772,254 | 3,784,099 |
Mortgage notes payable | ||
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 2,050,914 | $ 2,055,867 |
Weighted average interest rate | 4.14% | 4.14% |
Variable Mortgages | ||
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 1,565,259 | $ 1,568,555 |
Weighted average interest rate | 7.15% | 6.68% |
Convertible Debt | Convertible senior notes | ||
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 230,000 | $ 230,000 |
Weighted average interest rate | 2% | 2% |
Other notes payable | ||
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 18,033 | $ 0 |
Weighted average interest rate | 5.90% | |
Other notes payable | Tangible Equity Units Senior Amortizing Notes | ||
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 23,850 | $ 25,586 |
Weighted average interest rate | 10.25% | 10.25% |
Debt-Narrative (Details)
Debt-Narrative (Details) | Mar. 31, 2023 USD ($) |
Credit Facilities [Line Items] | |
Percentage of total debt (as a percent) | 91.60% |
Mortgages | |
Credit Facilities [Line Items] | |
Mortgage debt | $ 3,500,000,000 |
Line of Credit | Fifth Amended and Restated Credit Agreement | Letter of Credit Sublimit | |
Credit Facilities [Line Items] | |
Letters of credit issued | 72,600,000 |
Line of Credit | Fifth Amended and Restated Credit Agreement | Letter of Credit | |
Credit Facilities [Line Items] | |
Letters of credit issued | 13,900,000 |
Credit facility, maximum borrowing capacity | 15,000,000 |
Line of Credit | Credit Agreement With Capital One, National Association | Revolving Credit Facility | |
Credit Facilities [Line Items] | |
Credit facility, maximum borrowing capacity | $ 80,000,000 |
Leases- Narrative (Details)
Leases- Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
May 09, 2023 USD ($) community | Mar. 31, 2023 USD ($) lease community | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Lessee, Lease, Description [Line Items] | ||||
Operating and financing leases, number of communities | community | 295 | |||
Operating lease, number of communities | lease | 246 | |||
Financing leases, number of communities | lease | 49 | |||
Operating lease right-of-use assets | $ | $ 565,641 | $ 597,130 | ||
Subsequent Event | Mortgages | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, covenant provisions, required minimum tangible net worth | $ | $ 2,000,000 | |||
Subsequent Event | Welltower Inc. | ||||
Lessee, Lease, Description [Line Items] | ||||
Number of communities Company continues to lease | community | 74 | |||
Number of communities leased | community | 69 | |||
Operating leases, maximum fund costs | $ | $ 17,000 | |||
Operating lease right-of-use assets | $ | 125,000 | |||
Operating lease, covenant provisions, required minimum stockholders equity | $ | 400,000 | |||
Subsequent Event | Welltower Inc. | Mortgages | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, covenant provisions, required minimum tangible net worth | $ | $ 1,500,000 | |||
Subsequent Event | Welltower Inc. | Lease Expire From December 31, 2026 Until June 30, 2032 | ||||
Lessee, Lease, Description [Line Items] | ||||
Number of leases extended | community | 1 | |||
Number of communities leased | community | 39 | |||
Subsequent Event | Welltower Inc. | Lease Expire On June 30, 2032 | ||||
Lessee, Lease, Description [Line Items] | ||||
Number of communities leased | community | 69 | |||
Subsequent Event | Welltower Inc. | Lease Expire On December 31, 2024 | ||||
Lessee, Lease, Description [Line Items] | ||||
Number of communities leased | community | 5 | |||
Subsequent Event | Welltower Inc. | Minimum Rent Leasing Arrangement | SOFR | ||||
Lessee, Lease, Description [Line Items] | ||||
Annual escalator rate | 4% | |||
CARES Act | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease right-of-use assets | $ | $ 8,600 | |||
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Finance and operating lease, renewal term | 5 years | |||
Minimum | Subsequent Event | Welltower Inc. | Minimum Rent Leasing Arrangement | SOFR | ||||
Lessee, Lease, Description [Line Items] | ||||
Annual escalator rate | 3% | |||
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Finance and operating lease, renewal term | 20 years |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases [Abstract] | ||
Facility operating expense | $ 1,626 | $ 1,523 |
Facility lease expense | 46,127 | 41,564 |
Operating lease expense | 47,753 | 43,087 |
Operating lease expense adjustment | 10,805 | 8,307 |
Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements | (2,244) | (1,490) |
Operating net cash outflows from operating leases | 56,314 | 49,904 |
Depreciation and amortization | 5,228 | 7,665 |
Interest expense: financing lease obligations | 6,552 | 12,058 |
Financing lease expense | 11,780 | 19,723 |
Operating cash outflows from financing leases | 6,552 | 12,058 |
Financing cash outflows from financing leases | 5,852 | 5,490 |
Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement | 0 | (3,207) |
Total net cash outflows from financing leases | $ 12,404 | $ 14,341 |
Leases - Maturity ASC 842 (Deta
Leases - Maturity ASC 842 (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Operating Leases | |
2023 (nine months) | $ 174,844 |
2024 | 218,481 |
2025 | 216,638 |
2026 | 101,785 |
2027 | 98,606 |
Thereafter | 135,448 |
Total lease payments | 945,802 |
Purchase option liability and non-cash gain on future sale of property | 0 |
Imputed interest and variable lease payments | (192,305) |
Total lease obligations | 753,497 |
Financing Leases | |
2023 (nine months) | 36,463 |
2024 | 49,309 |
2025 | 37,189 |
2026 | 37,894 |
2027 | 5,861 |
Thereafter | 24,174 |
Total lease payments | 190,890 |
Purchase option liability and non-cash gain on future sale of property | 135,751 |
Imputed interest and variable lease payments | (83,609) |
Total lease obligations | $ 243,032 |
Investment in Unconsolidated _2
Investment in Unconsolidated Ventures (Details) - Healthcare Services Venture - Variable Interest Entity, Not Primary Beneficiary $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Investments in and Advances to Affiliates [Line Items] | |
Ownership percentage (as a percent) | 20% |
Maximum exposure to loss | $ 49.1 |
HCA Healthcare, Inc. | |
Investments in and Advances to Affiliates [Line Items] | |
Ownership percentage (as a percent) | 80% |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - Unvested Restricted Stock - Omnibus Incentive Plan 2014 $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Restricted Stock Unit and Stock Award Grants (in shares) | shares | 3,959 |
Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 2.97 |
Total Grant Date Fair Value | $ | $ 11,778 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) | 3 Months Ended | ||||
Mar. 31, 2023 $ / shares shares | Dec. 31, 2022 USD ($) day $ / shares shares | Mar. 31, 2022 shares | Oct. 01, 2021 USD ($) | Jul. 26, 2020 $ / shares shares | |
Class of Stock [Line Items] | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |||
Debt instrument, settlement, prepaid stock, minimum settlement rate (in shares) | 12.9341 | ||||
Debt instrument, settlement, prepaid stock, maximum settlement rate (in shares) | 15.1976 | ||||
Debt instrument, settlement, threshold consecutive trading days | day | 20 | ||||
Weighted average shares outstanding - basic (in shares) | 224,578,000 | 185,916,000 | |||
Ventas, Inc | The Warrant | |||||
Class of Stock [Line Items] | |||||
Number of shares authorized to be purchased (in shares) | 16,300,000 | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||
Share price (in dollars per share) | $ / shares | $ 3 | ||||
Convertible senior notes | |||||
Class of Stock [Line Items] | |||||
Number of shares issuable upon conversion (in shares) | 38,300,000 | ||||
Incremental shares issuable under purchase contracts | |||||
Class of Stock [Line Items] | |||||
Number of shares issuable upon conversion (in shares) | 43,700,000 | ||||
Weighted average shares outstanding - basic (in shares) | 37,200,000 | ||||
Convertible senior notes | Convertible Debt | |||||
Class of Stock [Line Items] | |||||
Debt face amount | $ | $ 230,000,000 | ||||
Interest rate, stated percentage | 2% | ||||
Tangible Equity Units Senior Amortizing Notes | Other notes payable | |||||
Class of Stock [Line Items] | |||||
Interest rate, stated percentage | 7% | ||||
Number of shares issued (in shares) | 2,875,000 | ||||
Stated amount, per unit (in dollars per share) | $ / shares | $ 50 | ||||
Aggregate offering | $ | $ 143,800,000 | ||||
Proceeds from debt, net of issuance costs | $ | $ 139,400,000 | ||||
Prepaid stock purchase contracts (in dollars per share) | $ / shares | $ 8.8996 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share, Basic (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Weighted average common shares outstanding (in shares) | 187,392 | 185,916 |
Minimum shares issuable under purchase contracts (in shares) | 37,186 | 0 |
Weighted average shares outstanding - basic (in shares) | 224,578 | 185,916 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 67.7 | 60.3 |
Convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 38.3 | 38.3 |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 16.3 | 16.3 |
Restricted stock and restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 6.6 | 5.7 |
Incremental shares issuable under purchase contracts | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 6.5 | 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Valuation Allowance [Line Items] | |||
Gross deferred federal, state and local tax expense (benefit) | $ (9.4) | $ 24.9 | |
Increase (decrease) in valuation allowance | 9.7 | $ (22.6) | |
Valuation allowance | $ 434.7 | $ 425 |
Supplemental Disclosure of Ca_3
Supplemental Disclosure of Cash Flow Information - Narrative (Details) $ in Thousands | 3 Months Ended | 15 Months Ended | |||
May 01, 2023 USD ($) community | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | Mar. 31, 2023 USD ($) community | Dec. 31, 2022 USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of communities acquired | community | 1 | ||||
Proceeds from sale of assets, net | $ 0 | $ 710 | |||
Current portion of long-term debt | 87,711 | $ 87,711 | $ 66,043 | ||
Assets held for sale | 23,555 | $ 23,555 | $ 0 | ||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of communities disposed of | community | 2 | ||||
Communities Disposed of Through Lease Terminations | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of communities disposed of | community | 4 | ||||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | CCRCs Segment | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Assets held for sale | 23,600 | $ 23,600 | |||
Liabilities held-for-sale, not part of disposal group, current | 19,500 | 19,500 | |||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | CCRCs Segment | Subsequent Event | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Number of entry fee communities sold | community | 1 | ||||
Proceeds from sale of assets, net | $ 12,300 | ||||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | CCRCs Segment | Secured Debt | Mortgages | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Current portion of long-term debt | $ 29,600 | $ 29,600 |
Supplemental Disclosure of Ca_4
Supplemental Disclosure of Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Supplemental Disclosure of Cash Flow Information: | ||
Interest paid | $ 55,110 | $ 43,927 |
Income taxes paid, net of refunds | (1,346) | 341 |
Net cash paid | 49,700 | 39,956 |
Capital expenditures, net of related payables | ||
Supplemental Disclosure of Cash Flow Information: | ||
Net cash paid | 49,700 | 39,956 |
Trade accounts payable | (15,975) | (4,928) |
Assets designated as held for sale | ||
Supplemental Disclosure of Cash Flow Information: | ||
Assets held for sale | 23,555 | 0 |
Property, plant and equipment and leasehold intangibles, net | (23,555) | 0 |
Liabilities held for sale | (19,455) | 0 |
Refundable fees and deferred revenue | 9,362 | 0 |
Other liabilities | 10,093 | 0 |
Net | 0 | 0 |
Non-development | Capital expenditures, net of related payables | ||
Supplemental Disclosure of Cash Flow Information: | ||
Net cash paid | 62,912 | 39,326 |
Development | Capital expenditures, net of related payables | ||
Supplemental Disclosure of Cash Flow Information: | ||
Net cash paid | 519 | 861 |
Non-development - reimbursable | Capital expenditures, net of related payables | ||
Supplemental Disclosure of Cash Flow Information: | ||
Net cash paid | $ 2,244 | $ 4,697 |
Supplemental Disclosure of Ca_5
Supplemental Disclosure of Cash Flow Information - Schedule of cash, cash equivalents, and restricted cash (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 362,235 | $ 398,850 | ||
Restricted cash | 29,374 | 27,735 | ||
Long-term restricted cash | 45,133 | 47,963 | ||
Total cash, cash equivalents, and restricted cash | $ 436,742 | $ 474,548 | $ 378,493 | $ 438,314 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) segment | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | segment | 3 | ||
Revenue | $ 753,263 | $ 677,820 | |
Segment operating income | 187,502 | 127,915 | |
General and administrative expense (including non-cash stock-based compensation expense) | 48,619 | 45,126 | |
Facility lease expense | 46,127 | 41,564 | |
Depreciation and amortization | 84,934 | 85,684 | |
Asset impairment | 0 | 9,075 | |
Income (loss) from operations | 7,822 | (53,534) | |
Total assets | 5,885,859 | $ 5,937,062 | |
Goodwill | 27,321 | 27,321 | |
Other operating income | |||
Segment Reporting Information [Line Items] | |||
Revenue | 2,328 | 376 | |
Independent Living | |||
Segment Reporting Information [Line Items] | |||
Goodwill | 27,300 | 27,300 | |
Operating Segments | Independent Living | |||
Segment Reporting Information [Line Items] | |||
Revenue | 140,656 | 124,406 | |
Segment operating income | 46,833 | 37,684 | |
Total assets | 1,253,570 | 1,267,825 | |
Operating Segments | Assisted Living and Memory Care | |||
Segment Reporting Information [Line Items] | |||
Revenue | 488,804 | 432,488 | |
Segment operating income | 124,593 | 76,863 | |
Total assets | 3,288,702 | 3,329,516 | |
Operating Segments | CCRCs | |||
Segment Reporting Information [Line Items] | |||
Revenue | 86,272 | 80,456 | |
Segment operating income | 13,499 | 10,039 | |
Total assets | 666,102 | 664,502 | |
Operating Segments | Corporate and All Other | |||
Segment Reporting Information [Line Items] | |||
Revenue | 37,531 | 40,470 | |
Segment operating income | 2,577 | $ 3,329 | |
Total assets | $ 677,485 | $ 675,219 |