Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 26, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-37401 | |
Entity Registrant Name | Community Healthcare Trust Inc | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 46-5212033 | |
Entity Address, Address Line One | 3326 Aspen Grove Drive | |
Entity Address, Address Line Two | Suite 150 | |
Entity Address, City or Town | Franklin | |
Entity Address, State or Province | TN | |
Entity Address, Postal Zip Code | 37067 | |
City Area Code | 615 | |
Local Phone Number | 771-3052 | |
Title of 12(b) Security | Common stock, $0.01 par value per share | |
Trading Symbol | CHCT | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 26,304,425 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001631569 | |
Current Fiscal Year End Date | --12-31 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Real estate properties | ||
Land and land improvements | $ 122,702 | $ 117,657 |
Buildings, improvements, and lease intangibles | 848,060 | 825,257 |
Personal property | 264 | 253 |
Total real estate properties | 971,026 | 943,167 |
Less accumulated depreciation | (174,346) | (165,341) |
Total real estate properties, net | 796,680 | 777,826 |
Cash and cash equivalents | 3,666 | 11,233 |
Restricted cash | 959 | 835 |
Other assets, net | 84,989 | 86,531 |
Total assets | 886,294 | 876,425 |
Liabilities | ||
Debt, net | 365,061 | 352,997 |
Accounts payable and accrued liabilities | 10,478 | 11,377 |
Other liabilities, net | 16,240 | 15,237 |
Total liabilities | 391,779 | 379,611 |
Commitments and contingencies | ||
Stockholders' Equity | ||
Preferred stock, $0.01 par value; 50,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.01 par value; 450,000 shares authorized; 26,274 and 25,897 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 263 | 259 |
Additional paid-in capital | 648,384 | 625,136 |
Cumulative net income | 74,220 | 81,142 |
Accumulated other comprehensive income | 15,684 | 22,667 |
Cumulative dividends | (244,036) | (232,390) |
Total stockholders’ equity | 494,515 | 496,814 |
Total liabilities and stockholders' equity | $ 886,294 | $ 876,425 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [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) | 450,000,000 | 450,000,000 |
Common stock, shares issued (in shares) | 26,274,000 | 25,897,000 |
Common stock, shares outstanding (in shares) | 26,274,000 | 25,897,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
REVENUES | |||
Rental income | $ 26,128 | $ 22,604 | |
Other operating interest | 1,048 | 877 | |
Total revenue | 27,176 | 23,481 | |
EXPENSES | |||
Property operating | 4,873 | 4,091 | |
General and administrative | [1] | 16,205 | 3,316 |
Depreciation and amortization | 9,018 | 7,942 | |
Total expenses | 30,096 | 15,349 | |
(LOSS) INCOME BEFORE INCOME TAXES AND OTHER ITEMS | (2,920) | 8,132 | |
Interest expense | (3,992) | (2,626) | |
Deferred income tax expense | (35) | 17 | |
Interest and other income | 25 | 1 | |
Net (loss) income | $ (6,922) | $ 5,524 | |
NET (LOSS) INCOME PER COMMON SHARE: | |||
Net (loss) income per common share – basic (in dollars per share) | $ (0.32) | $ 0.21 | |
Net (loss) income per common share – diluted (in dollars per share) | $ (0.32) | $ 0.21 | |
Weighted average common shares outstanding - basic (in shares) | 24,227 | 23,570 | |
Weighted average common shares outstanding - diluted (in shares) | 24,227 | 23,570 | |
[1] (1) General and administrative expenses for the three months ended March 31, 2023 included stock-based compensation expense totaling approximately $14.3 million, including the accelerated amortization of stock-based compensation totaling approximately $11.8 million recognized upon the passing of our former CEO and President. General and administrative expenses for the three months ended March 31, 2022 included stock-based compensation expense totaling approximately $2.1 million. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Stock-based compensation expense | $ 14,300 | $ 2,100 |
Accelerated amortization of stock-based compensation | $ 11,799 | $ 0 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
NET (LOSS) INCOME | $ (6,922) | $ 5,524 |
Other comprehensive (loss) income: | ||
(Decrease) increase in fair value of cash flow hedges | (4,973) | 11,407 |
Reclassification for amounts recognized as interest expense | (2,010) | 1,115 |
Total other comprehensive (loss) income | (6,983) | 12,522 |
COMPREHENSIVE (LOSS) INCOME | $ (13,905) | $ 18,046 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Additional Paid in Capital | Cumulative Net Income | Accumulated Other Comprehensive Income | Cumulative Dividends |
Beginning balance (in shares) at Dec. 31, 2021 | 0 | ||||||
Beginning balance at Dec. 31, 2021 | $ 462,112 | $ 0 | $ 250 | $ 595,624 | $ 59,123 | $ (4,980) | $ (187,905) |
Balance, beginning of period (in shares) at Dec. 31, 2021 | 24,983,000 | 24,983,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock, net of issuance costs | $ (197) | (197) | |||||
Stock-based compensation, net of forfeitures (in shares) | 89,000 | ||||||
Stock-based compensation, net of forfeitures | 2,122 | $ 1 | 2,121 | ||||
Decrease in fair value of cash flow hedges | 11,407 | 11,407 | |||||
Reclassification for amounts recognized as interest expense | 1,115 | 1,115 | |||||
Net (loss) income | 5,524 | 5,524 | |||||
Dividends to common stockholders | (10,969) | (10,969) | |||||
Ending balance (in shares) at Mar. 31, 2022 | 0 | ||||||
Ending balance at Mar. 31, 2022 | 471,114 | $ 0 | $ 251 | 597,548 | 64,647 | 7,542 | (198,874) |
Balance, end of period (in shares) at Mar. 31, 2022 | 25,072,000 | ||||||
Beginning balance (in shares) at Dec. 31, 2021 | 0 | ||||||
Beginning balance at Dec. 31, 2021 | $ 462,112 | $ 0 | $ 250 | 595,624 | 59,123 | (4,980) | (187,905) |
Balance, beginning of period (in shares) at Dec. 31, 2021 | 24,983,000 | 24,983,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock, net of issuance costs (in shares) | 600,000 | ||||||
Ending balance (in shares) at Dec. 31, 2022 | 0 | 0 | |||||
Ending balance at Dec. 31, 2022 | $ 496,814 | $ 0 | $ 259 | 625,136 | 81,142 | 22,667 | (232,390) |
Balance, end of period (in shares) at Dec. 31, 2022 | 25,897,000 | 25,897,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock, net of issuance costs (in shares) | 249,000 | 249,000 | |||||
Issuance of common stock, net of issuance costs | $ 8,906 | $ 3 | 8,903 | ||||
Stock-based compensation, net of forfeitures (in shares) | 128,000 | ||||||
Stock-based compensation, net of forfeitures | 14,346 | $ 1 | 14,345 | ||||
Decrease in fair value of cash flow hedges | (4,973) | (4,973) | |||||
Reclassification for amounts recognized as interest expense | (2,010) | (2,010) | |||||
Net (loss) income | (6,922) | (6,922) | |||||
Dividends to common stockholders | $ (11,646) | (11,646) | |||||
Ending balance (in shares) at Mar. 31, 2023 | 0 | 0 | |||||
Ending balance at Mar. 31, 2023 | $ 494,515 | $ 0 | $ 263 | $ 648,384 | $ 74,220 | $ 15,684 | $ (244,036) |
Balance, end of period (in shares) at Mar. 31, 2023 | 26,274,000 | 26,274,000 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||
Dividends to common stockholders, per share (in dollars per share) | $ 0.4475 | $ 0.4375 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
OPERATING ACTIVITIES | ||
Net (loss) income | $ (6,922) | $ 5,524 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and amortization | 9,018 | 7,942 |
Other amortization | 265 | 216 |
Stock-based compensation | 2,547 | 2,122 |
Accelerated amortization of stock-based compensation | 11,799 | 0 |
Straight-line rent receivable | (917) | (820) |
Deferred income tax expense (benefit) | 35 | (17) |
Changes in operating assets and liabilities: | ||
Other assets | (2,390) | (844) |
Accounts payable and accrued liabilities | 133 | 352 |
Other liabilities | (870) | (73) |
Net cash provided by operating activities | 12,698 | 14,402 |
INVESTING ACTIVITIES | ||
Acquisitions of real estate | (23,895) | (5,845) |
Funding of notes receivable | (1,295) | (1,500) |
Proceeds from the repayment of notes receivable | 750 | 750 |
Capital expenditures on existing real estate properties | (4,138) | (1,892) |
Net cash used in investing activities | (28,578) | (8,487) |
FINANCING ACTIVITIES | ||
Net borrowings on revolving credit facility | 12,000 | 4,000 |
Mortgage note repayments | (32) | (40) |
Dividends paid | (11,646) | (10,969) |
Proceeds from issuance of common stock | 8,215 | 0 |
Equity issuance costs | (100) | (74) |
Net cash provided by (used for) financing activities | 8,437 | (7,083) |
Decrease in cash and cash equivalents and restricted cash | (7,443) | (1,168) |
Cash and cash equivalents and restricted cash, beginning of period | 12,068 | 2,867 |
Cash and cash equivalents and restricted cash, end of period | 4,625 | 1,699 |
Supplemental Cash Flow Information: | ||
Interest paid (net of capitalized interest) | 3,866 | 2,476 |
Invoices accrued for construction, tenant improvement and other capitalized costs | 3,274 | 982 |
Reclassification of registration statement costs incurred in prior year to equity issuance costs | 52 | 119 |
(Decrease) increase in fair value of cash flow hedges | (4,973) | 11,407 |
Income taxes paid | 60 | 12 |
Capitalized interest | 192 | 228 |
Net proceeds accrued for common stock issued in March with cash settlement in April | $ 732 | $ 0 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Overview Community Healthcare Trust Incorporated (the ‘‘Company’’, ‘‘we’’, ‘‘our’’) was organized in the State of Maryland on March 28, 2014. The Company is a fully-integrated healthcare real estate company that owns and acquires real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers. As of March 31, 2023, the Company had investments of approximately $974.0 million in 181 real estate properties (including a portion of one property accounted for as a sales-type lease with a gross amount totaling approximately $3.0 million). The properties are located in 34 states, totaling approximately 4.0 million square feet in the aggregate and were approximately 91.6% leased at March 31, 2023 with a weighted average remaining lease term of approximat ely 7.4 years. Any references to square footage, property count, or occupancy percentages, and any amounts derived from these values in these notes to the Condensed Consolidated Financial Statements, are outside the scope of our independent registered public accounting firm's review. Basis of Presentation The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and footnotes required by GAAP for complete financial statements. This interim financial information should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Management believes that all adjustments of a normal, recurring nature considered necessary for a fair presentation have been included. This interim financial information does not necessarily represent or indicate what the operating results will be for the year ending December 31, 2023. All intercompany accounts and transactions have been eliminated. Use of Estimates in the Condensed Consolidated Financial Statements Preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions that affect amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Actual results may materially differ from those estimates. Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents includes short-term investments with original maturities of three months or less when purchased. Restricted cash consists of amounts held by the lender of our mortgage note payable to provide for future real estate tax, insurance expenditures and tenant improvements related to one property. The carrying amounts approximate fair value due to the short term maturity of these investments. The following table provides a reconciliation of cash and cash equivalents and restricted cash: Balance as of March 31, (Dollars in thousands) 2023 2022 Cash and cash equivalents $ 3,666 $ 1,178 Restricted cash 959 521 Cash, cash equivalents and restricted cash $ 4,625 $ 1,699 Income Taxes The Company has elected to be taxed as a real estate investment trust ("REIT"), as defined under the Internal Revenue Code of 1986, as amended (the "Code"). The Company and two subsidiaries have also elected for those subsidiaries to be treated as taxable REIT subsidiaries ("TRSs"), which are subject to federal and state income taxes. No provision has been made for federal income taxes for the REIT; however, the Company has recorded income tax |
Real Estate Properties
Real Estate Properties | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate [Abstract] | |
Real Estate Properties | REAL ESTATE PROPERTIES As of March 31, 2023, we had investments of approximately $974.0 million in 181 real estate properties (including a portion of one property accounted for as a financing lease with a gross amount totaling approximately $3.0 million). The Company's investments are diversified by property type, geographic location, and tenant as shown in the following tables: Property Type # of Properties Gross Investment Medical Office Building 82 $ 370,918 Inpatient Rehabilitation Facilities 7 151,234 Acute Inpatient Behavioral 5 130,410 Specialty Centers 37 119,618 Physician Clinics 30 86,496 Surgical Centers and Hospitals 10 55,974 Behavioral Specialty Facilities 9 44,455 Long-term Acute Care Hospitals 1 14,937 Total 181 $ 974,042 State # of Properties Gross Investment Texas 15 $ 138,931 Illinois 16 121,640 Ohio 25 110,087 Florida 22 94,375 All Others 103 509,009 Total 181 $ 974,042 Primary Tenant # of Properties Gross Investment LifePoint Health (1) 5 $ 82,113 US Healthvest 3 77,964 All Others 173 813,965 Total 181 $ 974,042 _________ (1) During the first quarter of 2023, Everest Rehabilitation assigned its leases to LifePoint Health on four properties in which the Company had a gross investment totaling $80.7 million at March 31, 2023. |
Real Estate Leases
Real Estate Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Real Estate Leases | REAL ESTATE LEASES Lessor Accounting The Company’s properties are generally leased pursuant to non-cancelable, fixed-term operating leases with expiration dates through 2039. The Company’s leases generally require the lessee to pay minimum rent, with fixed rent renewal terms or increases based on a Consumer Price Index and may also include additional rent, which may include the reimbursement of taxes (including property taxes), insurance, maintenance and other operating costs associated with the leased property. Some leases provide the lessee, during the term of the lease, with an option or right of first refusal to purchase the leased property. Some leases also allow the lessee to renew or extend their lease term or in some cases terminate their lease, based on conditions provided in the lease. Future minimum lease payments under the non-cancelable operating leases due to the Company for the years ending December 31, as of March 31, 2023, are as follows (in thousands): 2023 (nine months ended December 31) $ 67,851 2024 86,063 2025 79,894 2026 70,085 2027 64,285 2028 and thereafter 367,034 $ 735,212 Rental income is recognized as earned over the life of the lease agreement on a straight-line basis when collection of rental payments over the term of the lease is probable. Straight-line rent included in rental income was approximately $0.9 million and $0.8 million, respectively, for the three months ended March 31, 2023 and 2022. Purchase Option Provisions Certain of the Company's leases provide the lessee with a purchase option or a right of first refusal to purchase the leased property. The purchase option provisions generally allow the lessee to purchase the leased property at fair value or at an amount greater than the Company's gross investment in the leased property at the time of the purchase. At March 31, 2023, the Company had an aggregate gross investment of approximately $40.7 million in 12 real estate properties with purchase options exercisable at March 31, 2023 that had not been exercised. Sales-type Lease The Company has a portion of one property accounted for as a sales-type lease with a gross amount totaling approximately $3.0 million included in other assets, net on the Company's Condensed Consolidated Balance Sheets. Future lease payments due to the Company under this lease for the years ending December 31, as of March 31, 2023, are as follows (in thousands): 2023 (nine months ended December 31) $ 253 2024 346 2025 356 2026 367 2027 378 2028 and thereafter 5,210 Total undiscounted lease receivable 6,910 Discount (3,877) Lease receivable $ 3,033 The Company recognized interest income of approximately $0.1 million and $0.1 million, respectively, during the three months ended March 31, 2023 and 2022 related to this lease which is included in other operating interest on the Company's Consolidated Statements of Operations. Lessee Accounting At March 31, 2023, the Company was obligated, as the lessee, under four non-prepaid ground leases accounted for as operating leases with expiration dates, including renewal options, through 2076, and two non-prepaid ground leases accounted for as financing leases with expiration dates through 2109, including renewal options. Any rental increases related to the Company's ground leases are generally either stated or based on the Consumer Price Index. The Company's future lease payments under these non-prepaid ground leases were as follows (in thousands): Operating Financing 2023 (nine months ended December 31) $ 32 $ 106 2024 43 154 2025 44 154 2026 44 154 2027 45 154 2028 and thereafter 1,148 6,956 Total undiscounted lease payments 1,356 7,678 Discount (573) (4,400) Lease liabilities $ 783 $ 3,278 The following table discloses other information regarding the ground leases. Three Months Ended 2023 2022 Operating leases: Weighted-average remaining lease term in years (including renewal options) 36.03 36.73 Weighted-average discount rate 4.0 % 4.0 % Financing leases: Weighted-average remaining lease term in years (including renewal options) 40.56 36.75 Weighted-average discount rate 4.2 % 4.1 % |
Real Estate Acquisitions
Real Estate Acquisitions | 3 Months Ended |
Mar. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Real Estate Acquisitions | REAL ESTATE ACQUISITIONS During the first quarter of 2023, the Company acquired seven real estate properties. Upon acquisition, the properties were 100.0% leased in the aggregate with lease expirations through 2031. Amounts reflected in revenues and net (loss) income for these properties for the three months ended March 31, 2023 were approximately $0.5 million and $0.1 million, respectively, and transaction costs totaling approximately $0.4 million were capitalized relating to these property acquisitions. Location Property Type (1) Date Purchase Cash Real Estate Other (2) Square Footage (000's) (000's) (000's) (000's) LaGrange, GA MOB 01/18/23 $ 8,007 $ 8,087 $ 8,118 $ (31) 55,310 West Point, GA MOB 01/18/23 811 819 822 (3) 5,600 Canton, OH MOB 01/30/23 3,669 3,706 4,287 (581) 27,920 Scranton, PA MOB 02/23/23 1,957 2,165 2,317 (152) 22,743 Scranton, PA MOB 02/23/23 2,207 2,366 2,340 26 15,768 Lagrange, GA MOB 03/06/23 6,469 6,458 6,622 (164) 31,473 Lagrange, GA MOB 03/06/23 249 294 300 (6) 2,972 $ 23,369 $ 23,895 $ 24,806 $ (911) 161,786 (1) MOB - Medical Office Building (2) Includes other assets acquired, liabilities assumed, and above and below-market intangibles recognized at acquisition. The following table summarizes the relative fair values of the assets acquired and liabilities assumed in the property acquisitions for the three months ended March 31, 2023. Relative Estimated (in thousands) (in years) Land and land improvements $ 4,961 7.4 Building and building improvements 16,791 23.2 Intangibles: At-market lease intangibles 3,054 3.5 Above-market lease intangibles 199 3.3 Below-market lease intangibles (1,188) 5.8 Total intangibles 2,065 Accounts payable, accrued liabilities and other liabilities assumed (46) Accounts receivable and other assets acquired 224 Prorated rent, interest and operating expense reimbursement amounts collected (100) Total cash consideration $ 23,895 |
Debt, net
Debt, net | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt, net | DEBT, NET The table below details the Company's debt as of March 31, 2023 and December 31, 2022. Balance as of (Dollars in thousands) March 31, 2023 December 31, 2022 Maturity Dates Credit Facility: Revolving Credit Facility $ 12,000 $ — 3/26 A-3 Term Loan, net 74,639 74,609 3/26 A-4 Term Loan, net 124,437 124,409 3/28 A-5 Term Loan, net 149,091 149,059 3/30 Mortgage Note Payable, net 4,894 4,920 5/24 $ 365,061 $ 352,997 On December 14, 2022, Community Healthcare Trust Incorporated, as borrower, entered into a first amendment (the "First Amendment") to the third amended and restated credit agreement (the "Credit Facility") by and among Community Healthcare Trust Incorporated, as borrower, the several banks and financial institutions party thereto as lenders, and Truist Bank, as administrative agent. The First Amendment amended the Credit Facility to, among other things, (i) establish a new seven-year and three-month term loan facility in the aggregate principal amount of $150.0 million (the "A-5 Term Loan"), which matures on March 14, 2030 and (ii) replace LIBOR as a benchmark interest rate for loans under the Credit Facility with SOFR. The proceeds from the A-5 Term Loan were used in part to repay the seven-year term loan facility in the aggregate principal amount of $50.0 million (the "A-2 Term Loan") which was set to mature on March 29, 2024. The Credit Facility allows the Company to borrow, through the accordion feature, up to $700.0 million, including the ability to add and fund incremental term loans. The Company's material subsidiaries are guarantors of the obligations under the Credit Facility. The Credit Facility provides for a $150.0 million Revolving Credit Facility and $350.0 million in term loans (the "Term Loans"). The Revolving Credit Facility matures on March 19, 2026 and includes one 12-month option to extend the maturity date, subject to the satisfaction of certain conditions. The Term Loans include a seven-year term loan facility in the aggregate principal amount of $75.0 million (the "A-3 Term Loan"), which matures on March 29, 2026, a seven-year term loan facility in the aggregate principal amount of $125.0 million (the "A-4 Term Loan"), which matures on March 19, 2028, and the A-5 Term Loan, which matures on March 14, 2030. Under the First Amendment, amounts outstanding under the Revolving Credit Facility will bear interest at a floating rate based on the Company's option, on either: (i) adjusted term SOFR or adjusted daily simple SOFR plus 1.25% to 1.90% or (ii) a base rate plus 0.25% to 0.90% in each case, depending upon the Company’s leverage ratio. In addition, the Company is obligated to pay an annual fee equal to 0.20% of the amount of the unused portion of the Revolving Credit Facility if amounts borrowed are greater than 33.3% of the borrowing capacity under the Revolving Credit Facility and 0.25% of the unused portion of the Revolving Credit Facility if amounts borrowed are less than or equal to 33.3% of the borrowing capacity under the Revolving Credit Facility. The Company had $12.0 million outstanding under the Revolving Credit Facility with a weighted average interest rate of 6.55% and a borrowing capacity remaining of $138.0 million at March 31, 2023. Under the First Amendment, amounts outstanding under the Term Loans will bear interest at a floating rate that is based, at the Company's option, on either (i) adjusted term SOFR or adjusted daily SOFR plus 1.45% to 2.30% or (ii) a base rate plus 0.45% to 1.30%, in each case, depending upon the Company’s leverage ratio. The Company has entered into interest rate swaps to fix the interest rates on the Term Loans. See Note 6 – Derivative Financial Instruments for more details on the interest rate swaps. At March 31, 2023, the Company had $350.0 million outstanding under the Term Loans which had a fixed weighted average interest rate under the swaps of approximate ly 4.3% . The Company’s ability to borrow under the Credit Facility is subject to its ongoing compliance with a number of customary affirmative and negative covenants, including limitations with respect to liens, indebtedness, distributions, mergers, consolidations, investments, restricted payments and asset sales, as well as financial maintenance covenants. The Company was in compliance with its financial covenants under its Credit Facility as of March 31, 2023. Mortgage Note Payable |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | DERIVATIVE FINANCIAL INSTRUMENTS Risk Management Objective of Using Derivatives The Company may use derivative financial instruments, including interest rate swaps, caps, options, floors and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company’s operating and financial structure as well as to hedge specific anticipated transactions. The Company does not intend to utilize derivatives for speculative or other purposes other than interest rate risk management. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. As of March 31, 2023, the Company had seventeen outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk for notional amounts totaling $350.0 million, including two forward-starting interest rate swaps for notional amounts totaling $50.0 million, which will not become effective until March 29, 2024. Tabular Disclosure of Fair Value of Derivative Instruments on the Balance Sheet The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022. Asset Derivatives Fair Value at Liability Derivatives Fair Value at (Dollars in thousands) March 31, 2023 December 31, 2022 Balance Sheet Classification March 31, 2023 December 31, 2022 Balance Sheet Classification Interest rate swaps $ 16,397 $ 22,667 Other assets, net $ 712 $ — Other liabilities, net The changes in the fair value of derivatives designated and that qualify as cash flow hedges are recorded in accumulated other comprehensive income ("AOCI") and are subsequently reclassified to interest expense in the period that the hedged forecasted transaction affects earnings. Amounts reported in AOCI related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s Term Loans. During the next twelve months, the Company estimates that an additional $8.5 million will be reclassified from AOCI as a decrease to interest expense. Tabular Disclosure of the Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income The table below details the location in the financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three months ended March 31, 2023 and 2022. Three Months Ended (Dollars in thousands) 2023 2022 Amount of unrealized (loss) gain recognized in OCI on derivatives $ (4,973) $ 11,407 Amount of (gain) loss reclassified from AOCI into interest expense $ (2,010) $ 1,115 Total interest expense presented in the Condensed Consolidated Statements of Operations in which the effects of the cash flow hedges are recorded $ 3,992 $ 2,626 Tabular Disclosures of Offsetting Derivatives The tables below present a gross presentation, the effects of offsetting, and a net presentation of the Company's derivatives as of March 31, 2023 and December 31, 2022. The net amounts of derivative assets or liabilities can be reconciled to the tabular disclosure of fair value. The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented on the Condensed Consolidated Balance Sheets. Offsetting of Derivative Assets (as of March 31, 2023) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Assets Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Assets in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ 16,397 $ — $ 16,397 $ (712) $ — $ 15,685 Offsetting of Derivative Liabilities (as of March 31, 2023) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Liabilities in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ (712) $ — $ (712) $ 712 $ — $ — Offsetting of Derivative Assets (as of December 31, 2022) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Assets Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Assets in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ 22,667 $ — $ 22,667 $ — $ — $ 22,667 Offsetting of Derivative Liabilities (as of December 31, 2022) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Liabilities in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ — $ — $ — $ — $ — $ — Credit-risk-related Contingent Features As of March 31, 2023, the Company did not have any derivatives in a net liability position. As of March 31, 2023, the Company had not posted any collateral related to these agreements and was not in breach of any agreement provisions. If the Company terminated these interest rate swaps or breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | STOCKHOLDERS' EQUITY Common Stock The following table provides a reconciliation of the beginning and ending common stock balances for the three months ended March 31, 2023 and for the year ended December 31, 2022: (In thousands) Three Months Ended Year Ended Balance, beginning of period 25,897 24,983 Issuance of common stock 249 600 Restricted stock issued 129 318 Restricted stock withheld and forfeited (1) (4) Balance, end of period 26,274 25,897 ATM Program The Company has an at-the-market offering program ("ATM Program"), with Piper Sandler & Co., Evercore Group L.L.C., Truist Securities, Inc., Regions Securities LLC, Robert W. Baird & Co. Incorporated, Fifth Third Securities, Inc. and Janney Montgomery Scott LLC, as sales agents (collectively, the “Agents”). Under the ATM Program, the Company may issue and sell shares of its common stock, having an aggregate gross sales price of up to $500.0 million. The shares of common stock may be sold from time to time through or to one or more of the Agents, as may be determined by the Company in its sole discretion, subject to the terms and conditions of the agreement and applicable law. The Company's activity under the ATM Program during the three months ended March 31, 2023 is detailed in the table below. As of March 31, 2023, the Company had approximately $469.9 million remaining that may be issued under the ATM Program. Three Months Ended Shares issued ( in thousands ) 249 Net proceeds received ( in millions) (1) $8.9 Average gross sales price per share $36.69 ___________ (1) Net proceeds received includes shares sold on March 30, 2023 and reflected in shares outstanding at March 31, 2023, for which $0.7 million of cash proceeds was received by the Company on April 3, 2023. |
Net (Loss) Income Per Common Sh
Net (Loss) Income Per Common Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income Per Common Share | NET (LOSS) INCOME PER COMMON SHARE The following table sets forth the computation of basic and diluted net (loss) income per common share for the three months ended March 31, 2023 and 2022, respectively. Three Months Ended (In thousands, except per share data) 2023 2022 Net (loss) income $ (6,922) $ 5,524 Participating securities' share in earnings (822) (658) Net (loss) income, less participating securities' share in earnings $ (7,744) $ 4,866 Weighted average Common Shares outstanding Weighted average Common Shares outstanding 26,043 25,060 Unvested restricted shares (1,816) (1,490) Weighted average Common Shares outstanding–Basic 24,227 23,570 Dilutive potential common shares — — Weighted average Common Shares outstanding –Diluted 24,227 23,570 Basic Net (Loss) Income per Common Share $ (0.32) $ 0.21 Diluted Net (Loss) Income per Common Share $ (0.32) $ 0.21 |
Stock Incentive Plan
Stock Incentive Plan | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Incentive Plan | STOCK INCENTIVE PLAN A summary of the activity under the Company's 2014 Incentive Plan, as amended, for the three months ended March 31, 2023 and 2022 is included in the table below, as well as compensation expense recognized from the amortization of the value of shares over the applicable vesting periods. Three Months Ended (Dollars and shares in thousands) 2023 2022 Stock-based awards, beginning of period 1,708 1,416 Stock in lieu of compensation 62 44 Stock awards 67 48 Total stock granted 129 92 Vested shares — (5) Forfeited shares (1) (1) Stock-based awards, end of period 1,836 1,502 Amortization expense (1) $ 14,346 $ 2,122 ___________ (1) Amortization expense for the three months ended March 31, 2023 includes the accelerated amortization totaling $11.8 million recognized upon the passing of our former CEO and President. Accelerated Amortization of Restricted Stock The Company's former CEO and President, Timothy Wallace, passed away on March 3, 2023. At the time of his passing, Mr. Wallace had 624,725 shares of restricted stock that had not been fully amortized. Upon his passing, Mr. Wallace's unvested shares of restricted stock vested in accordance with the terms of his employment agreement, and the Company accelerated the unamortized remaining balance of deferred compensation related to his unvested shares and recognized an additional $11.8 million of amortization expense in the first quarter of 2023. |
Other Assets, net
Other Assets, net | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets, net | OTHER ASSETS, NET Other assets, net on the Company's Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 are detailed in the table below. Balance as of (Dollars in thousands) March 31, 2023 December 31, 2022 Notes receivable $ 33,250 $ 32,705 Accounts and interest receivable 5,387 2,679 Straight-line rent receivable 16,342 15,429 Prepaid assets 1,341 980 Deferred financing costs, net 630 683 Leasing commissions, net 2,036 1,848 Deferred tax assets, net 271 306 Fair value of interest rate swaps 16,397 22,667 Above-market lease intangible assets, net 2,441 2,399 Sales-type lease receivable 3,033 3,035 Financing right-of-use asset 2,530 2,545 Operating lease right-of-use assets 751 759 Other 580 496 $ 84,989 $ 86,531 The Company's notes receivable mainly included: • At March 31, 2023 and December 31, 2022, notes receivable included a $8.3 million and $9.0 million, respectively, term loan, secured by all assets and ownership interests in seven long-term acute care hospitals and one inpatient rehabilitation hospital owned by the borrower. The term loan will be repaid in equal monthly installments of $250,000 through the maturity date of December 31, 2025 and bears interest at 9% per annum. • At March 31, 2023 and December 31, 2022 , notes receivable included a $17.0 million term loan and a $5.5 million and $5.0 million, respectively, revolving credit facility, secured by assets and ownership interests of six geriatric behavioral hospitals and affiliated companies all of which are co-borrowers on the loans. The term loan bears interest at 9% per annum, with interest only payments due initially and then equal monthly installments of principal payments due beginning March 3 1, 2024 . The term loan facility matures on Decem ber 31, 2032 . The revolving credit facility bears interest at 9% per annum and matures on December 31, 2025 . In addition, the Company has committed to fund, at the Company’s discretion, additional amounts, up to $5.0 million with interest at 9% per annum on any amount funded, that may be used by the borrower to pay existing liabilities of co-borrowers. The term loan, the revolving credit facility and the additional commitment all include a 3% non-cash interest charge that is due and payable upon the earlier of the repayment or maturity of each note. • At March 31, 2023 and December 31, 2022, notes receivable included a $2.5 million and $1.7 million, respectively, revolving credit facility. Commencing on October 1, 2023, the revolving credit facility will be repaid in equal monthly installments of $40,000 through the maturity date of April 1, 2027. The revolving credit facility bears interest at 9% per annum, as well as a 3% non-cash interest charge that is due and payable upon the earlier of the repayment or maturity of the note. The Company identified the borrowers of these notes as variable interest entities ("VIEs"), but management determined that the Company was not the primary beneficiary of the VIEs because we lack either directly or through related parties any material decision-making rights or control of the entities that impact the borrowers' economic performance. We are not obligated to provide support beyond our stated commitment to the borrowers, and accordingly our maximum exposure to loss as a result of this relationship is limited to the amount of our outstanding notes receivable. The VIEs that we have identified at March 31, 2023 are summarized in the table below. Classification Carrying Amount (in thousands) Maximum Exposure to Loss (in thousands) Note receivable (term loan) $ 8,250 $ 8,250 Note receivable (revolving credit facility) $ 5,500 $ 5,500 Note receivable (term loan) $ 17,000 $ 17,000 Note receivable (revolving credit facility) $ 2,500 $ 2,500 |
Other Liabilities, net
Other Liabilities, net | 3 Months Ended |
Mar. 31, 2023 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities, net | OTHER LIABILITIES, NET Other liabilities, net on the Company's Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 are detailed in the table below. Balance as of (Dollars in thousands) March 31, 2023 December 31, 2022 Prepaid rent $ 4,862 $ 3,853 Security deposits 3,615 5,766 Below-market lease intangibles, net 2,144 1,075 Fair value of interest rate swaps 712 — Financing lease liability 3,278 3,279 Operating lease liability 783 786 Other 846 478 $ 16,240 $ 15,237 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | FAIR VALUE OF FINANCIAL INSTRUMENTS The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practical to estimate the fair value. Cash and cash equivalents and restricted cash - The carrying amount approximates the fair value. Notes receivable - The fair value is estimated using cash flow analyses, based on an assumed market rate of interest or at a rate consistent with the rates on notes carried by the Company and are classified as level 2 inputs in the hierarchy. Borrowings under our Credit Facility - The carrying amount approximates the fair value because the borrowings are based on variable market interest rates. The fair value estimates were determined using level 2 inputs. Derivative financial instruments (Interest rate swaps) - The fair value is estimated using discounted cash flow techniques. These techniques incorporate primarily level 2 inputs. The market inputs are utilized in the discounted cash flow calculation considering the instrument’s term, notional amount, discount rate and credit risk. Significant inputs to the derivative valuation model for interest rate swaps are observable in active markets and are classified as level 2 inputs in the hierarchy. Mortgage note payable - The fair value is estimated using cash flow analyses which are based on an assumed market rate of interest or at a rate consistent with the rates on mortgage notes assumed by the Company and are classified as level 2 inputs in the hierarchy. The table below details the fair values and carrying values for our notes receivable, interest rate swaps, and mortgage note payable at March 31, 2023 and December 31, 2022, using level 2 inputs. March 31, 2023 December 31, 2022 (Dollars in thousands) Carrying Value Fair Value Carrying Value Fair Value Notes receivable $ 33,250 $ 33,319 $ 32,705 $ 32,716 Interest rate swap asset $ 16,397 $ 16,397 $ 22,667 $ 22,667 Interest rate swap liability $ 712 $ 712 $ — $ — Mortgage note payable (principal amount) $ 4,915 $ 4,766 $ 4,947 $ 4,761 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Dividend Declared On April 27, 2023, the Company’s Board of Directors declared a quarterly common stock dividend in the amount of $0.45 per share. The dividend is payable on May 26, 2023 to stockholders of record on May 12, 2023. |
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 Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and footnotes required by GAAP for complete financial statements. This interim financial information should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Management believes that all adjustments of a normal, recurring nature considered necessary for a fair presentation have been included. This interim financial information does not necessarily represent or indicate what the operating results will be for the year ending December 31, 2023. All intercompany accounts and transactions have been eliminated. |
Use of Estimates in the Condensed Consolidated Financial Statements | Use of Estimates in the Condensed Consolidated Financial Statements Preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions that affect amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Actual results may materially differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents and Restricted CashCash and cash equivalents includes short-term investments with original maturities of three months or less when purchased. |
Restricted Cash | Restricted cash consists of amounts held by the lender of our mortgage note payable to provide for future real estate tax, insurance expenditures and tenant improvements related to one property. The carrying amounts approximate fair value due to the short term maturity of these investments. |
Income Taxes | Income Taxes The Company has elected to be taxed as a real estate investment trust ("REIT"), as defined under the Internal Revenue Code of 1986, as amended (the "Code"). The Company and two subsidiaries have also elected for those subsidiaries to be treated as taxable REIT subsidiaries ("TRSs"), which are subject to federal and state income taxes. No provision has been made for federal income taxes for the REIT; however, the Company has recorded income tax |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of cash and cash equivalents | The following table provides a reconciliation of cash and cash equivalents and restricted cash: Balance as of March 31, (Dollars in thousands) 2023 2022 Cash and cash equivalents $ 3,666 $ 1,178 Restricted cash 959 521 Cash, cash equivalents and restricted cash $ 4,625 $ 1,699 |
Restrictions on cash and cash equivalents | The following table provides a reconciliation of cash and cash equivalents and restricted cash: Balance as of March 31, (Dollars in thousands) 2023 2022 Cash and cash equivalents $ 3,666 $ 1,178 Restricted cash 959 521 Cash, cash equivalents and restricted cash $ 4,625 $ 1,699 |
Real Estate Properties (Tables)
Real Estate Properties (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate [Abstract] | |
Schedule of real estate property investments | The Company's investments are diversified by property type, geographic location, and tenant as shown in the following tables: Property Type # of Properties Gross Investment Medical Office Building 82 $ 370,918 Inpatient Rehabilitation Facilities 7 151,234 Acute Inpatient Behavioral 5 130,410 Specialty Centers 37 119,618 Physician Clinics 30 86,496 Surgical Centers and Hospitals 10 55,974 Behavioral Specialty Facilities 9 44,455 Long-term Acute Care Hospitals 1 14,937 Total 181 $ 974,042 State # of Properties Gross Investment Texas 15 $ 138,931 Illinois 16 121,640 Ohio 25 110,087 Florida 22 94,375 All Others 103 509,009 Total 181 $ 974,042 Primary Tenant # of Properties Gross Investment LifePoint Health (1) 5 $ 82,113 US Healthvest 3 77,964 All Others 173 813,965 Total 181 $ 974,042 _________ (1) During the first quarter of 2023, Everest Rehabilitation assigned its leases to LifePoint Health on four properties in which the Company had a gross investment totaling $80.7 million at March 31, 2023. |
Real Estate Leases (Tables)
Real Estate Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Schedule of future minimum lease payments for operating leases | Future minimum lease payments under the non-cancelable operating leases due to the Company for the years ending December 31, as of March 31, 2023, are as follows (in thousands): 2023 (nine months ended December 31) $ 67,851 2024 86,063 2025 79,894 2026 70,085 2027 64,285 2028 and thereafter 367,034 $ 735,212 |
Sales-type maturity | Future lease payments due to the Company under this lease for the years ending December 31, as of March 31, 2023, are as follows (in thousands): 2023 (nine months ended December 31) $ 253 2024 346 2025 356 2026 367 2027 378 2028 and thereafter 5,210 Total undiscounted lease receivable 6,910 Discount (3,877) Lease receivable $ 3,033 |
Schedule of operating lease payments | The Company's future lease payments under these non-prepaid ground leases were as follows (in thousands): Operating Financing 2023 (nine months ended December 31) $ 32 $ 106 2024 43 154 2025 44 154 2026 44 154 2027 45 154 2028 and thereafter 1,148 6,956 Total undiscounted lease payments 1,356 7,678 Discount (573) (4,400) Lease liabilities $ 783 $ 3,278 |
Schedule of finance lease payments | The Company's future lease payments under these non-prepaid ground leases were as follows (in thousands): Operating Financing 2023 (nine months ended December 31) $ 32 $ 106 2024 43 154 2025 44 154 2026 44 154 2027 45 154 2028 and thereafter 1,148 6,956 Total undiscounted lease payments 1,356 7,678 Discount (573) (4,400) Lease liabilities $ 783 $ 3,278 |
Ground leases | The following table discloses other information regarding the ground leases. Three Months Ended 2023 2022 Operating leases: Weighted-average remaining lease term in years (including renewal options) 36.03 36.73 Weighted-average discount rate 4.0 % 4.0 % Financing leases: Weighted-average remaining lease term in years (including renewal options) 40.56 36.75 Weighted-average discount rate 4.2 % 4.1 % |
Real Estate Acquisitions (Table
Real Estate Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of acquisitions | Location Property Type (1) Date Purchase Cash Real Estate Other (2) Square Footage (000's) (000's) (000's) (000's) LaGrange, GA MOB 01/18/23 $ 8,007 $ 8,087 $ 8,118 $ (31) 55,310 West Point, GA MOB 01/18/23 811 819 822 (3) 5,600 Canton, OH MOB 01/30/23 3,669 3,706 4,287 (581) 27,920 Scranton, PA MOB 02/23/23 1,957 2,165 2,317 (152) 22,743 Scranton, PA MOB 02/23/23 2,207 2,366 2,340 26 15,768 Lagrange, GA MOB 03/06/23 6,469 6,458 6,622 (164) 31,473 Lagrange, GA MOB 03/06/23 249 294 300 (6) 2,972 $ 23,369 $ 23,895 $ 24,806 $ (911) 161,786 (1) MOB - Medical Office Building (2) Includes other assets acquired, liabilities assumed, and above and below-market intangibles recognized at acquisition. |
Schedule of assets acquired and liabilities assumed | he following table summarizes the relative fair values of the assets acquired and liabilities assumed in the property acquisitions for the three months ended March 31, 2023. Relative Estimated (in thousands) (in years) Land and land improvements $ 4,961 7.4 Building and building improvements 16,791 23.2 Intangibles: At-market lease intangibles 3,054 3.5 Above-market lease intangibles 199 3.3 Below-market lease intangibles (1,188) 5.8 Total intangibles 2,065 Accounts payable, accrued liabilities and other liabilities assumed (46) Accounts receivable and other assets acquired 224 Prorated rent, interest and operating expense reimbursement amounts collected (100) Total cash consideration $ 23,895 |
Debt, net (Tables)
Debt, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of debt | The table below details the Company's debt as of March 31, 2023 and December 31, 2022. Balance as of (Dollars in thousands) March 31, 2023 December 31, 2022 Maturity Dates Credit Facility: Revolving Credit Facility $ 12,000 $ — 3/26 A-3 Term Loan, net 74,639 74,609 3/26 A-4 Term Loan, net 124,437 124,409 3/28 A-5 Term Loan, net 149,091 149,059 3/30 Mortgage Note Payable, net 4,894 4,920 5/24 $ 365,061 $ 352,997 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair value of derivative instruments on balance sheet | The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022. Asset Derivatives Fair Value at Liability Derivatives Fair Value at (Dollars in thousands) March 31, 2023 December 31, 2022 Balance Sheet Classification March 31, 2023 December 31, 2022 Balance Sheet Classification Interest rate swaps $ 16,397 $ 22,667 Other assets, net $ 712 $ — Other liabilities, net Offsetting of Derivative Assets (as of March 31, 2023) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Assets Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Assets in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ 16,397 $ — $ 16,397 $ (712) $ — $ 15,685 Offsetting of Derivative Liabilities (as of March 31, 2023) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Liabilities in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ (712) $ — $ (712) $ 712 $ — $ — Offsetting of Derivative Assets (as of December 31, 2022) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Assets Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Assets in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ 22,667 $ — $ 22,667 $ — $ — $ 22,667 Offsetting of Derivative Liabilities (as of December 31, 2022) Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets (In thousands) Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Condensed Consolidated Balance Sheet Net Amounts of Liabilities in the Condensed Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives $ — $ — $ — $ — $ — $ — |
Schedule of derivative Income | The table below details the location in the financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three months ended March 31, 2023 and 2022. Three Months Ended (Dollars in thousands) 2023 2022 Amount of unrealized (loss) gain recognized in OCI on derivatives $ (4,973) $ 11,407 Amount of (gain) loss reclassified from AOCI into interest expense $ (2,010) $ 1,115 Total interest expense presented in the Condensed Consolidated Statements of Operations in which the effects of the cash flow hedges are recorded $ 3,992 $ 2,626 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Schedule of reconciliation of common stock | The following table provides a reconciliation of the beginning and ending common stock balances for the three months ended March 31, 2023 and for the year ended December 31, 2022: (In thousands) Three Months Ended Year Ended Balance, beginning of period 25,897 24,983 Issuance of common stock 249 600 Restricted stock issued 129 318 Restricted stock withheld and forfeited (1) (4) Balance, end of period 26,274 25,897 |
Schedule of ATM Program | As of March 31, 2023, the Company had approximately $469.9 million remaining that may be issued under the ATM Program. Three Months Ended Shares issued ( in thousands ) 249 Net proceeds received ( in millions) (1) $8.9 Average gross sales price per share $36.69 ___________ (1) Net proceeds received includes shares sold on March 30, 2023 and reflected in shares outstanding at March 31, 2023, for which $0.7 million of cash proceeds was received by the Company on April 3, 2023. |
Net (Loss) Income Per Common _2
Net (Loss) Income Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of (loss) income per share | The following table sets forth the computation of basic and diluted net (loss) income per common share for the three months ended March 31, 2023 and 2022, respectively. Three Months Ended (In thousands, except per share data) 2023 2022 Net (loss) income $ (6,922) $ 5,524 Participating securities' share in earnings (822) (658) Net (loss) income, less participating securities' share in earnings $ (7,744) $ 4,866 Weighted average Common Shares outstanding Weighted average Common Shares outstanding 26,043 25,060 Unvested restricted shares (1,816) (1,490) Weighted average Common Shares outstanding–Basic 24,227 23,570 Dilutive potential common shares — — Weighted average Common Shares outstanding –Diluted 24,227 23,570 Basic Net (Loss) Income per Common Share $ (0.32) $ 0.21 Diluted Net (Loss) Income per Common Share $ (0.32) $ 0.21 |
Stock Incentive Plan (Tables)
Stock Incentive Plan (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of nonvested restricted stock activity | A summary of the activity under the Company's 2014 Incentive Plan, as amended, for the three months ended March 31, 2023 and 2022 is included in the table below, as well as compensation expense recognized from the amortization of the value of shares over the applicable vesting periods. Three Months Ended (Dollars and shares in thousands) 2023 2022 Stock-based awards, beginning of period 1,708 1,416 Stock in lieu of compensation 62 44 Stock awards 67 48 Total stock granted 129 92 Vested shares — (5) Forfeited shares (1) (1) Stock-based awards, end of period 1,836 1,502 Amortization expense (1) $ 14,346 $ 2,122 ___________ (1) Amortization expense for the three months ended March 31, 2023 includes the accelerated amortization totaling $11.8 million recognized upon the passing of our former CEO and President. |
Other Assets, net (Tables)
Other Assets, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of other assets | Other assets, net on the Company's Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 are detailed in the table below. Balance as of (Dollars in thousands) March 31, 2023 December 31, 2022 Notes receivable $ 33,250 $ 32,705 Accounts and interest receivable 5,387 2,679 Straight-line rent receivable 16,342 15,429 Prepaid assets 1,341 980 Deferred financing costs, net 630 683 Leasing commissions, net 2,036 1,848 Deferred tax assets, net 271 306 Fair value of interest rate swaps 16,397 22,667 Above-market lease intangible assets, net 2,441 2,399 Sales-type lease receivable 3,033 3,035 Financing right-of-use asset 2,530 2,545 Operating lease right-of-use assets 751 759 Other 580 496 $ 84,989 $ 86,531 |
Schedule of VIEs | The VIEs that we have identified at March 31, 2023 are summarized in the table below. Classification Carrying Amount (in thousands) Maximum Exposure to Loss (in thousands) Note receivable (term loan) $ 8,250 $ 8,250 Note receivable (revolving credit facility) $ 5,500 $ 5,500 Note receivable (term loan) $ 17,000 $ 17,000 Note receivable (revolving credit facility) $ 2,500 $ 2,500 |
Other Liabilities, net (Tables)
Other Liabilities, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of other liabilities | Other liabilities, net on the Company's Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 are detailed in the table below. Balance as of (Dollars in thousands) March 31, 2023 December 31, 2022 Prepaid rent $ 4,862 $ 3,853 Security deposits 3,615 5,766 Below-market lease intangibles, net 2,144 1,075 Fair value of interest rate swaps 712 — Financing lease liability 3,278 3,279 Operating lease liability 783 786 Other 846 478 $ 16,240 $ 15,237 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by balance sheet grouping | The table below details the fair values and carrying values for our notes receivable, interest rate swaps, and mortgage note payable at March 31, 2023 and December 31, 2022, using level 2 inputs. March 31, 2023 December 31, 2022 (Dollars in thousands) Carrying Value Fair Value Carrying Value Fair Value Notes receivable $ 33,250 $ 33,319 $ 32,705 $ 32,716 Interest rate swap asset $ 16,397 $ 16,397 $ 22,667 $ 22,667 Interest rate swap liability $ 712 $ 712 $ — $ — Mortgage note payable (principal amount) $ 4,915 $ 4,766 $ 4,947 $ 4,761 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands, ft² in Millions | Mar. 31, 2023 USD ($) ft² real_estate_property state | Dec. 31, 2022 USD ($) |
Accounting Policies [Abstract] | ||
Total real estate properties | $ | $ 974,042 | |
Number of real estate properties | real_estate_property | 181 | |
Number of properties held for investment in financing lease | real_estate_property | 1 | |
Lease receivable | $ | $ 3,033 | $ 3,035 |
Number of states | state | 34 | |
Area of real estate property (in square feet) | ft² | 4 | |
Percentage leased | 91.60% | |
Remaining lease term | 7 years 4 months 24 days |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Cash and Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 3,666 | $ 11,233 | $ 1,178 | |
Restricted cash | 959 | 835 | 521 | |
Cash, cash equivalents and restricted cash | $ 4,625 | $ 12,068 | $ 1,699 | $ 2,867 |
Real Estate Properties - Additi
Real Estate Properties - Additional Information (Details) $ in Thousands | Mar. 31, 2023 USD ($) real_estate_property | Dec. 31, 2022 USD ($) |
Real Estate [Abstract] | ||
Total real estate properties | $ | $ 974,042 | |
Number of real estate properties | real_estate_property | 181 | |
Number of properties held for investment in financing lease | real_estate_property | 1 | |
Financing lease liability | $ | $ 3,278 | $ 3,279 |
Real Estate Properties - Schedu
Real Estate Properties - Schedule of Real Estate Property Investments (Details) $ in Thousands | Mar. 31, 2023 USD ($) real_estate_property |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 181 |
Total real estate properties | $ | $ 974,042 |
LifePoint Health | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 5 |
Total real estate properties | $ | $ 82,113 |
US Healthvest | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 3 |
Total real estate properties | $ | $ 77,964 |
All Others | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 173 |
Total real estate properties | $ | $ 813,965 |
Everest Rehabilitation | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 4 |
Total real estate properties | $ | $ 80,700 |
Texas | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 15 |
Total real estate properties | $ | $ 138,931 |
Illinois | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 16 |
Total real estate properties | $ | $ 121,640 |
Ohio | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 25 |
Total real estate properties | $ | $ 110,087 |
Florida | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 22 |
Total real estate properties | $ | $ 94,375 |
All Others | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 103 |
Total real estate properties | $ | $ 509,009 |
Medical Office Building | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 82 |
Total real estate properties | $ | $ 370,918 |
Inpatient Rehabilitation Facilities | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 7 |
Total real estate properties | $ | $ 151,234 |
Acute Inpatient Behavioral | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 5 |
Total real estate properties | $ | $ 130,410 |
Specialty Centers | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 37 |
Total real estate properties | $ | $ 119,618 |
Physician Clinics | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 30 |
Total real estate properties | $ | $ 86,496 |
Surgical Centers and Hospitals | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 10 |
Total real estate properties | $ | $ 55,974 |
Behavioral Specialty Facilities | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 9 |
Total real estate properties | $ | $ 44,455 |
Long-term Acute Care Hospitals | |
Real Estate Properties [Line Items] | |
Number of real estate properties | real_estate_property | 1 |
Total real estate properties | $ | $ 14,937 |
Real Estate Leases - Future Min
Real Estate Leases - Future Minimum Lease Payments Under Non-cancelable Operating Leases (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Leases [Abstract] | |
2023 (nine months ended December 31) | $ 67,851 |
2024 | 86,063 |
2025 | 79,894 |
2026 | 70,085 |
2027 | 64,285 |
2028 and thereafter | 367,034 |
Total | $ 735,212 |
Real Estate Leases - Additional
Real Estate Leases - Additional Information (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) lease real_estate_property | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Concentration Risk [Line Items] | |||
Straight line rent | $ 917 | $ 820 | |
Real estate investment property, net | $ 796,680 | $ 777,826 | |
Number of real estate properties | real_estate_property | 181 | ||
Number of properties held for investment in financing lease | real_estate_property | 1 | ||
Lease receivable | $ 3,033 | $ 3,035 | |
Interest income | $ 100 | $ 100 | |
Number of operating leases | lease | 4 | ||
Number of finance leases | lease | 2 | ||
Four Real Estate Property | |||
Concentration Risk [Line Items] | |||
Real estate investment property, net | $ 40,700 | ||
Number of real estate properties | real_estate_property | 12 |
Real Estate Leases - Lease Rece
Real Estate Leases - Lease Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
2023 (nine months ended December 31) | $ 253 | |
2024 | 346 | |
2025 | 356 | |
2026 | 367 | |
2027 | 378 | |
2028 and thereafter | 5,210 | |
Total undiscounted lease receivable | 6,910 | |
Discount | (3,877) | |
Lease receivable | $ 3,033 | $ 3,035 |
Real Estate Leases - Future Lea
Real Estate Leases - Future Lease Payments Under Non-prepaid Ground Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Operating | ||
2023 (nine months ended December 31) | $ 32 | |
2024 | 43 | |
2025 | 44 | |
2026 | 44 | |
2027 | 45 | |
2028 and thereafter | 1,148 | |
Total undiscounted lease payments | 1,356 | |
Discount | (573) | |
Lease liabilities | 783 | $ 786 |
Financing | ||
2023 (nine months ended December 31) | 106 | |
2024 | 154 | |
2025 | 154 | |
2026 | 154 | |
2027 | 154 | |
2028 and thereafter | 6,956 | |
Total undiscounted lease payments | 7,678 | |
Discount | (4,400) | |
Lease liabilities | $ 3,278 | $ 3,279 |
Real Estate Leases - Ground Lea
Real Estate Leases - Ground Leases (Details) | Mar. 31, 2023 | Mar. 31, 2022 |
Operating leases: | ||
Weighted-average remaining lease term in years (including renewal options) | 36 years 10 days | 36 years 8 months 23 days |
Weighted-average discount rate | 4% | 4% |
Financing leases: | ||
Weighted-average remaining lease term in years (including renewal options) | 40 years 6 months 21 days | 36 years 9 months |
Weighted-average discount rate | 4.20% | 4.10% |
Real Estate Acquisitions - Addi
Real Estate Acquisitions - Additional Information (Details) - Acquisitions Of Properties During Q1 2023 $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) real_estate_property | |
Business Acquisition [Line Items] | |
Number of real estate properties acquired | real_estate_property | 7 |
Percentage of properties that were leased at acquisition | 100% |
Pro forma information, revenue of acquiree since acquisition date, actual | $ 0.5 |
Pro forma information, income of acquiree since acquisition date, actual | 0.1 |
Transaction costs | $ 0.4 |
Real Estate Acquisitions - Summ
Real Estate Acquisitions - Summary of Real Estate Acquisitions (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) ft² | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Square footage (in square feet) | ft² | 4,000,000 |
Acquisitions Of Properties During Q1 2023 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 23,369 |
Cash Consideration | 23,895 |
Real Estate | 24,806 |
Other (2) | $ (911) |
Square footage (in square feet) | ft² | 161,786 |
Acquisitions Of Properties During Q1 2023 | LaGrange, GA | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 8,007 |
Cash Consideration | 8,087 |
Real Estate | 8,118 |
Other (2) | $ (31) |
Square footage (in square feet) | ft² | 55,310 |
Acquisitions Of Properties During Q1 2023 | West Point, GA | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 811 |
Cash Consideration | 819 |
Real Estate | 822 |
Other (2) | $ (3) |
Square footage (in square feet) | ft² | 5,600 |
Acquisitions Of Properties During Q1 2023 | Canton, OH | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 3,669 |
Cash Consideration | 3,706 |
Real Estate | 4,287 |
Other (2) | $ (581) |
Square footage (in square feet) | ft² | 27,920 |
Acquisitions Of Properties During Q1 2023 | Scranton, PA | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 1,957 |
Cash Consideration | 2,165 |
Real Estate | 2,317 |
Other (2) | $ (152) |
Square footage (in square feet) | ft² | 22,743 |
Acquisitions Of Properties During Q1 2023 | Scranton, PA | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 2,207 |
Cash Consideration | 2,366 |
Real Estate | 2,340 |
Other (2) | $ 26 |
Square footage (in square feet) | ft² | 15,768 |
Acquisitions Of Properties During Q1 2023 | Lagrange, GA | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 6,469 |
Cash Consideration | 6,458 |
Real Estate | 6,622 |
Other (2) | $ (164) |
Square footage (in square feet) | ft² | 31,473 |
Acquisitions Of Properties During Q1 2023 | Lagrange, GA | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase Price | $ 249 |
Cash Consideration | 294 |
Real Estate | 300 |
Other (2) | $ (6) |
Square footage (in square feet) | ft² | 2,972 |
Real Estate Acquisitions - Asse
Real Estate Acquisitions - Assets Acquired and Liabilities Assumed (Details) - Series of Individually Immaterial Asset Acquisitions $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Business Acquisition [Line Items] | |
Land and land improvements | $ 4,961 |
Building and building improvements | 16,791 |
Intangibles: | |
Below-market lease intangibles | $ (1,188) |
Below market lease useful life (in years) | 5 years 9 months 18 days |
Total intangibles | $ 2,065 |
Accounts payable, accrued liabilities and other liabilities assumed | (46) |
Accounts receivable and other assets acquired | 224 |
Prorated rent, interest and operating expense reimbursement amounts collected | (100) |
Total cash consideration | 23,895 |
At-market lease intangibles | |
Intangibles: | |
Lease intangibles | $ 3,054 |
Intangibles useful life (in years) | 3 years 6 months |
Above-market lease intangibles | |
Intangibles: | |
Lease intangibles | $ 199 |
Intangibles useful life (in years) | 3 years 3 months 18 days |
Land and land improvements | |
Business Acquisition [Line Items] | |
Estimated useful life (in years) | 7 years 4 months 24 days |
Building and building improvements | |
Business Acquisition [Line Items] | |
Estimated useful life (in years) | 23 years 2 months 12 days |
Debt, net - Schedule of Debt (D
Debt, net - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Debt, net | $ 365,061 | $ 352,997 |
Mortgage Note Payable, net | ||
Debt Instrument [Line Items] | ||
Debt, net | 4,894 | 4,920 |
Revolving Credit Facility | Line of Credit | Third Amended And Restated Credit Facility | ||
Debt Instrument [Line Items] | ||
Debt, net | 12,000 | 0 |
A-3 Term Loan, net | Term Loan | Third Amended And Restated Credit Facility | ||
Debt Instrument [Line Items] | ||
Debt, net | 74,639 | 74,609 |
A-4 Term Loan, net | Term Loan | Third Amended And Restated Credit Facility | ||
Debt Instrument [Line Items] | ||
Debt, net | 124,437 | 124,409 |
A-5 Term Loan, net | Term Loan | Third Amended And Restated Credit Facility | ||
Debt Instrument [Line Items] | ||
Debt, net | $ 149,091 | $ 149,059 |
Debt, net - Narrative (Details)
Debt, net - Narrative (Details) | Dec. 14, 2022 USD ($) option | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) |
Line of Credit Facility [Line Items] | |||
Amount outstanding | $ 365,061,000 | $ 352,997,000 | |
Real estate investment property, net | 796,680,000 | 777,826,000 | |
Mortgage Note Payable, net | |||
Line of Credit Facility [Line Items] | |||
Amount outstanding | $ 4,894,000 | 4,920,000 | |
Fixed interest rate (in percent) | 4.98% | ||
Debt instrument, balloon payment to be paid | $ 4,800,000 | ||
Mortgage Note Payable, net | Building | |||
Line of Credit Facility [Line Items] | |||
Real estate investment property, net | 6,400,000 | ||
Third Amended And Restated Credit Facility | A-5 Term Loan, net | Term Loan | |||
Line of Credit Facility [Line Items] | |||
Face amount | $ 150,000,000 | ||
Debt term (in years) | 7 years 3 months | ||
Amount outstanding | 149,091,000 | 149,059,000 | |
Third Amended And Restated Credit Facility | Revolving Credit Facility | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 150,000,000 | ||
Number of options to extend | option | 1 | ||
Length of extension | 12 months | ||
Amount outstanding | $ 12,000,000 | 0 | |
Weighted average interest rate percentage | 6.55% | ||
Remaining borrowing capacity | $ 138,000,000 | ||
Third Amended And Restated Credit Facility | Revolving Credit Facility | Line of Credit | SOFR | Minimum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 1.25% | ||
Third Amended And Restated Credit Facility | Revolving Credit Facility | Line of Credit | SOFR | Maximum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 1.90% | ||
Third Amended And Restated Credit Facility | Revolving Credit Facility | Line of Credit | Base Rate | Minimum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 0.25% | ||
Third Amended And Restated Credit Facility | Revolving Credit Facility | Line of Credit | Base Rate | Maximum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 0.90% | ||
Third Amended And Restated Credit Facility | Term Loan | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 350,000,000 | ||
Third Amended And Restated Credit Facility | A-2 Term Loan, net | Term Loan | |||
Line of Credit Facility [Line Items] | |||
Face amount | $ 50,000,000 | ||
Debt term (in years) | 7 years | ||
Third Amended And Restated Credit Facility | Credit Facility, Accordion Feature | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 700,000,000 | ||
Third Amended And Restated Credit Facility | A-3 Term Loan, net | Term Loan | |||
Line of Credit Facility [Line Items] | |||
Face amount | $ 75,000,000 | ||
Debt term (in years) | 7 years | ||
Amount outstanding | 74,639,000 | 74,609,000 | |
Third Amended And Restated Credit Facility | A-4 Term Loan, net | Term Loan | |||
Line of Credit Facility [Line Items] | |||
Face amount | $ 125,000,000 | ||
Debt term (in years) | 7 years | ||
Amount outstanding | 124,437,000 | $ 124,409,000 | |
Third Amended And Restated Credit Facility | Revolving Credit Facility, Unused Borrowing Capacity Rate 1 | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Unused borrowing commitment fee percentage | 0.20% | ||
Percentage of borrowing capacity outstanding | 33.30% | ||
Third Amended And Restated Credit Facility | Revolving Credit Facility, Unused Borrowing Capacity Rate 2 | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Unused borrowing commitment fee percentage | 0.25% | ||
Percentage of borrowing capacity outstanding | 33.30% | ||
First Amended And Restated Credit Facility | Term Loan | |||
Line of Credit Facility [Line Items] | |||
Amount outstanding | $ 350,000,000 | ||
Weighted average interest rate percentage | 4.30% | ||
First Amended And Restated Credit Facility | Term Loan | SOFR | Minimum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 1.45% | ||
First Amended And Restated Credit Facility | Term Loan | SOFR | Maximum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 2.30% | ||
First Amended And Restated Credit Facility | Term Loan | Base Rate | Minimum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 0.45% | ||
First Amended And Restated Credit Facility | Term Loan | Base Rate | Maximum | |||
Line of Credit Facility [Line Items] | |||
Variable rate percentage | 1.30% |
Derivative Financial Instrume_3
Derivative Financial Instruments - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) derivative_instrument | |
Derivative [Line Items] | |
Cash flow hedges reclassified to interest expense | $ 8.5 |
Cash Flow Hedging | Interest Rate Contract | |
Derivative [Line Items] | |
Number outstanding interest rate derivatives | derivative_instrument | 17 |
Notional amount | $ 350 |
Cash Flow Hedging | Interest Rate Swap | |
Derivative [Line Items] | |
Number outstanding interest rate derivatives | derivative_instrument | 2 |
Notional amount | $ 50 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Fair Value Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Derivatives, Fair Value [Line Items] | ||
Interest rate swap asset | $ 16,397 | $ 22,667 |
Interest rate swap liability | $ 712 | $ 0 |
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other assets, net | Other assets, net |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Other liabilities, net | Other liabilities, net |
Cash Flow Hedging | Interest rate swaps | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate swap asset | $ 16,397 | $ 22,667 |
Interest rate swap liability | $ 712 | $ 0 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Cash Flow Hedging (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Interest Expense | Interest Expense |
Interest Rate Contract | Cash Flow Hedging | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of unrealized (loss) gain recognized in OCI on derivatives | $ (4,973) | $ 11,407 |
Total interest expense presented in the Condensed Consolidated Statements of Operations in which the effects of the cash flow hedges are recorded | 3,992 | 2,626 |
Interest Rate Contract | Cash Flow Hedging | Interest Expense | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of (gain) loss reclassified from AOCI into interest expense | $ (2,010) | $ 1,115 |
Derivative Financial Instrume_6
Derivative Financial Instruments - Offsetting of Derivative Assets and Liability (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Derivative Asset [Abstract] | ||
Gross Amounts of Recognized Assets | $ 16,397 | $ 22,667 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet | 0 | 0 |
Net Amounts of Assets in the Condensed Consolidated Balance Sheets | 16,397 | 22,667 |
Gross amounts not offset in the condensed Consolidated balance sheets, financial instruments | (712) | 0 |
Gross amounts not offset in the condensed consolidated balance sheets, net amount | 0 | 0 |
Gross amounts not offset in the condensed consolidated balance sheets, cash collateral received | 15,685 | 22,667 |
Derivative Liability [Abstract] | ||
Gross Amounts of Recognized Liabilities | (712) | 0 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet | 0 | 0 |
Net Amounts of Liabilities in the Condensed Consolidated Balance Sheets | (712) | 0 |
Gross amounts not offset in the condensed consolidated balance sheets, financial instruments | 712 | 0 |
Gross amounts not offset in the condensed consolidated balance sheets, cash collateral received | 0 | 0 |
Gross amounts not offset in the condensed consolidated balance sheets, net amount | $ 0 | $ 0 |
Stockholders' Equity - Reconcil
Stockholders' Equity - Reconciliation of Common Stock (Details) - shares shares in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance, beginning of period (in shares) | 25,897 | 24,983 |
Issuance of common stock, net of issuance costs (in shares) | 249 | 600 |
Restricted stock issued (in shares) | 129 | 318 |
Restricted stock withheld and forfeited (in shares) | (1) | (4) |
Balance, end of period (in shares) | 26,274 | 25,897 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - At The Market Offering Program - Common Stock $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Subsidiary, Sale of Stock [Line Items] | |
Value of shares authorized | $ 500 |
Shares available for issuance (in shares) | $ 469.9 |
Stockholders' Equity - ATM Prog
Stockholders' Equity - ATM Program (Details) - Common Stock - At The Market Offering Program - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | |
Mar. 30, 2023 | Mar. 31, 2023 | |
Class of Stock [Line Items] | ||
Sale of stock, number of shares issued in transaction (in shares) | 249 | |
Net proceeds received | $ 0.7 | $ 8.9 |
Average gross sales price per share (in dollars per share) | $ 36.69 |
Net (Loss) Income Per Common _3
Net (Loss) Income Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Net (loss) income | $ (6,922) | $ 5,524 |
Participating securities' share in earnings | (822) | (658) |
Net (loss) income, less participating securities' share in earnings | $ (7,744) | $ 4,866 |
Weighted average Common Shares outstanding | ||
Weighted average common shares outstanding (in shares) | 26,043 | 25,060 |
Unvested restricted shares (in shares) | (1,816) | (1,490) |
Weighted average common shares outstanding – basic (in shares) | 24,227 | 23,570 |
Dilutive potential common share (in shares) | 0 | 0 |
Weighted average common shares outstanding –diluted (in shares) | 24,227 | 23,570 |
Basic net (loss) income per common share (in dollars per share) | $ (0.32) | $ 0.21 |
Diluted net (loss) income per common share (in dollars per share) | $ (0.32) | $ 0.21 |
Stock Incentive Plan (Details)
Stock Incentive Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 03, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | |
Stock-based awards: | |||
Stock-based compensation expense | $ 14,300 | $ 2,100 | |
Accelerated amortization of stock-based compensation | 11,799 | $ 0 | |
Restricted Common Stock | Former CEO and President | |||
Stock-based awards: | |||
Share based payment award, accelerated vesting (in shares) | 624,725 | ||
Accelerated amortization of stock-based compensation | $ 11,800 | ||
2014 Incentive Plan | Restricted Common Stock | |||
Stock-based awards: | |||
Stock-based awards, beginning of period (in shares) | 1,708,000 | 1,416,000 | |
Granted (in shares) | 129,000 | 92,000 | |
Vested (in shares) | 0 | (5,000) | |
Forfeited (in shares) | (1,000) | (1,000) | |
Stock-based awards, end of period (in shares) | 1,836,000 | 1,502,000 | |
Stock-based compensation expense | $ 14,346 | $ 2,122 | |
2014 Incentive Plan | Stock in lieu of compensation | |||
Stock-based awards: | |||
Granted (in shares) | 62,000 | 44,000 | |
2014 Incentive Plan | Stock awards | |||
Stock-based awards: | |||
Granted (in shares) | 67,000 | 48,000 |
Other Assets, net - Other Asset
Other Assets, net - Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Notes receivable | $ 33,250 | $ 32,705 |
Accounts and interest receivable | 5,387 | 2,679 |
Straight-line rent receivable | 16,342 | 15,429 |
Prepaid assets | 1,341 | 980 |
Deferred financing costs, net | 630 | 683 |
Leasing commissions, net | 2,036 | 1,848 |
Deferred tax assets, net | 271 | 306 |
Fair value of interest rate swaps | 16,397 | 22,667 |
Above-market lease intangible assets, net | 2,441 | 2,399 |
Sales-type lease receivable | 3,033 | 3,035 |
Financing right-of-use asset | 2,530 | 2,545 |
Operating lease right-of-use assets | 751 | 759 |
Other | 580 | 496 |
Other assets, net | $ 84,989 | $ 86,531 |
Other Assets, net - Narrative (
Other Assets, net - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2023 USD ($) hospital | Dec. 31, 2022 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable | $ 33,250,000 | $ 32,705,000 |
Note receivable (term loan) | Variable Interest Entity, Not Primary Beneficiary | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable | $ 8,250,000 | |
Notes Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Note receivable interest rate | 9% | |
Additional funding | $ 5,000,000 | |
Non-cash interest rate | 3% | |
Notes Receivable | Note receivable (term loan) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable | $ 8,300,000 | 9,000,000 |
Payment received | $ 250,000 | |
Note receivable interest rate | 9% | |
Notes Receivable | Note receivable (revolving credit facility) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Payment received | $ 40,000 | |
Note receivable (term loan) | Variable Interest Entity, Not Primary Beneficiary | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable | 17,000,000 | 17,000,000 |
Note receivable (revolving credit facility) | Variable Interest Entity, Not Primary Beneficiary | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable | 5,500,000 | 5,000,000 |
Note receivable (revolving credit facility) | Variable Interest Entity, Not Primary Beneficiary | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable | $ 2,500,000 | $ 1,700,000 |
Long-Term Acute Care Hospitals | Note receivable (term loan) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of properties used to secure notes by borrower | hospital | 7 | |
Inpatient Rehabilitation Facilities | Note receivable (term loan) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of properties used to secure notes by borrower | hospital | 1 | |
Geriatric Behavioral Hospital | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of properties used to secure notes by borrower | hospital | 6 | |
Revolving Credit Facility | Notes Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Note receivable interest rate | 9% | |
Revolving Credit Facility | Note receivable (revolving credit facility) | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Note receivable interest rate | 9% | |
Non-cash interest rate | 3% |
Other Assets, net - VIEs (Detai
Other Assets, net - VIEs (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Variable Interest Entity [Line Items] | ||
Carrying amount | $ 33,250 | $ 32,705 |
Variable Interest Entity, Not Primary Beneficiary | Note receivable (term loan) | ||
Variable Interest Entity [Line Items] | ||
Carrying amount | 8,250 | |
Maximum exposure to loss | 8,250 | |
Variable Interest Entity, Not Primary Beneficiary | Note receivable (revolving credit facility) | ||
Variable Interest Entity [Line Items] | ||
Carrying amount | 5,500 | 5,000 |
Maximum exposure to loss | 5,500 | |
Variable Interest Entity, Not Primary Beneficiary | Note receivable (term loan) | ||
Variable Interest Entity [Line Items] | ||
Carrying amount | 17,000 | 17,000 |
Maximum exposure to loss | 17,000 | |
Variable Interest Entity, Not Primary Beneficiary | Note receivable (revolving credit facility) | ||
Variable Interest Entity [Line Items] | ||
Carrying amount | 2,500 | $ 1,700 |
Maximum exposure to loss | $ 2,500 |
Other Liabilities, net (Details
Other Liabilities, net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Other Liabilities Disclosure [Abstract] | |||
Prepaid rent | $ 4,862 | $ 3,853 | |
Security deposits | 3,615 | 5,766 | |
Below-market lease intangibles, net | 2,144 | 1,075 | |
Fair value of interest rate swaps | 712 | $ 0 | |
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Other liabilities, net | Other liabilities, net | |
Financing lease liability | 3,278 | $ 3,279 | |
Operating lease, liability, statement of financial position | Other liabilities, net | Other liabilities, net | |
Operating lease liability | 783 | $ 786 | |
Other | 846 | 478 | |
Other liabilities, net | $ 16,240 | $ 15,237 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes receivable | $ 33,250 | $ 32,705 |
Interest rate swap asset | 16,397 | 22,667 |
Interest rate swap liability | 712 | 0 |
Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes receivable | 33,250 | 32,705 |
Mortgage note payable (principal amount) | 4,915 | 4,947 |
Carrying Value | Interest rate swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate swap asset | 16,397 | 22,667 |
Interest rate swap liability | 712 | 0 |
Fair Value | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes receivable | 33,319 | 32,716 |
Mortgage note payable (principal amount) | 4,766 | 4,761 |
Fair Value | Interest rate swaps | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate swap asset | 16,397 | 22,667 |
Interest rate swap liability | $ 712 | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) | Apr. 27, 2023 $ / shares |
Subsequent Event | |
Subsequent Event [Line Items] | |
Dividend declared (in dollars per share) | $ 0.45 |