UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, ~~2022~~2023

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934 FOR THE TRANSITION PERIOD FROM____________TO____________

Commission file number: 1-10989

Ventas, Inc.

(Exact Name of Registrant as Specified in Its Charter)


Delaware						61-1055020
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification No.)

353 N. Clark Street, Suite 3300

Chicago, Illinois 60654

(Address of Principal Executive Offices)

(877) 483-6827

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Exchange on Which Registered

Common Stock $0.25 par value

VTR

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer ☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

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

As of May 3, ~~2022,~~2023, there were ~~399,695,507~~400,051,793 shares of the registrant’s common stock outstanding.

VENTAS, INC.

FORM 10-Q

INDEX

Page

PART I—FINANCIAL INFORMATION

Item 1.

Consolidated Financial Statements (Unaudited)

Consolidated Balance Sheets as of March 31, ~~2022~~2023 and December 31, ~~2021~~2022

Consolidated Statements of Income for the Three Months Ended March 31, ~~2022~~2023 and ~~2021~~2022

Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, ~~2022~~2023 and ~~2021~~2022

Consolidated Statements of Equity for the Three Months Ended March 31, ~~2022~~2023 and ~~2021~~2022

Consolidated Statements of Cash Flows for the Three Months Ended March 31, ~~2022~~2023 and ~~2021~~2022

Notes to Consolidated Financial Statements

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

2925

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

4845

Item 4.

Controls and Procedures

5048

PART II—OTHER INFORMATION

Unregistered Sales of Equity Securities and Use of Proceeds

PART I—FINANCIAL INFORMATION

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS

VENTAS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share amounts, unaudited)


		As of March 31, 2022		As of December 31, 2021			As of March 31, 2023		As of December 31, 2022

Assets	Assets					Assets
Real estate investments:	Real estate investments:					Real estate investments:
Land and improvements	Land and improvements	$	2,452,474	$	2,432,065	Land and improvements	$	2,434,312	$	2,437,905
Buildings and improvements	Buildings and improvements	26,186,628		25,778,490		Buildings and improvements	26,078,611		26,020,048
Construction in progress	Construction in progress	275,896		269,315		Construction in progress	335,879		310,456
Acquired lease intangibles	Acquired lease intangibles	1,373,364		1,369,747		Acquired lease intangibles	1,345,415		1,346,190
Operating lease assets	Operating lease assets	318,679		317,858		Operating lease assets	309,113		310,307
		30,607,041		30,167,475			30,503,330		30,424,906
Accumulated depreciation and amortization	Accumulated depreciation and amortization	(8,624,820)		(8,350,637)		Accumulated depreciation and amortization	(9,504,021)		(9,264,456)
Net real estate property	Net real estate property	21,982,221		21,816,838		Net real estate property	20,999,309		21,160,450
Secured loans receivable and investments, net	Secured loans receivable and investments, net	530,388		530,126		Secured loans receivable and investments, net	501,004		537,075
Investments in unconsolidated real estate entities	Investments in unconsolidated real estate entities	541,914		523,465		Investments in unconsolidated real estate entities	606,006		579,949
Net real estate investments	Net real estate investments	23,054,523		22,870,429		Net real estate investments	22,106,319		22,277,474
Cash and cash equivalents	Cash and cash equivalents	149,599		149,725		Cash and cash equivalents	145,357		122,564
Escrow deposits and restricted cash	Escrow deposits and restricted cash	49,848		46,872		Escrow deposits and restricted cash	49,924		48,181
Goodwill	Goodwill	1,045,663		1,046,140		Goodwill	1,044,699		1,044,415
Assets held for sale	Assets held for sale	26,231		28,399		Assets held for sale	20,233		44,893
Deferred income tax assets, net	Deferred income tax assets, net	11,152		11,152		Deferred income tax assets, net	10,889		10,490
Other assets	Other assets	613,091		565,069		Other assets	616,747		609,823
Total assets	Total assets	$	24,950,107	$	24,717,786	Total assets	$	23,994,168	$	24,157,840
Liabilities and equity	Liabilities and equity					Liabilities and equity
Liabilities:	Liabilities:					Liabilities:
Senior notes payable and other debt	Senior notes payable and other debt	$	12,413,743	$	12,027,544	Senior notes payable and other debt	$	12,342,506	$	12,296,780
Accrued interest	Accrued interest	93,564		106,602		Accrued interest	93,543		110,542
Operating lease liabilities	Operating lease liabilities	195,668		197,234		Operating lease liabilities	189,911		190,440
Accounts payable and other liabilities	Accounts payable and other liabilities	1,079,596		1,090,254		Accounts payable and other liabilities	1,007,437		1,031,689
Liabilities related to assets held for sale	Liabilities related to assets held for sale	8,411		10,850		Liabilities related to assets held for sale	4,412		6,492
Deferred income tax liabilities	Deferred income tax liabilities	52,750		59,259		Deferred income tax liabilities	31,871		35,570
Total liabilities	Total liabilities	13,843,732		13,491,743		Total liabilities	13,669,680		13,671,513
Redeemable OP unitholder and noncontrolling interests	Redeemable OP unitholder and noncontrolling interests	313,685		280,283		Redeemable OP unitholder and noncontrolling interests	259,886		264,650
Commitments and contingencies	Commitments and contingencies	0		0		Commitments and contingencies
Equity:	Equity:					Equity:
Ventas stockholders’ equity:	Ventas stockholders’ equity:					Ventas stockholders’ equity:
Preferred stock, $1.00 par value; 10,000 shares authorized, unissued	Preferred stock, $1.00 par value; 10,000 shares authorized, unissued	—		—		Preferred stock, $1.00 par value; 10,000 shares authorized, unissued	—		—
Common stock, $0.25 par value; 600,000 shares authorized, 399,623 and 399,420 shares issued at March 31, 2022 and December 31, 2021, respectively		99,888		99,838
Common stock, $0.25 par value; 600,000 shares authorized, 400,055 and 399,707 shares outstanding at March 31, 2023 and December 31, 2022, respectively						Common stock, $0.25 par value; 600,000 shares authorized, 400,055 and 399,707 shares outstanding at March 31, 2023 and December 31, 2022, respectively	100,065		99,912
Capital in excess of par value	Capital in excess of par value	15,478,467		15,498,956		Capital in excess of par value	15,562,017		15,539,777
Accumulated other comprehensive loss	Accumulated other comprehensive loss	(59,296)		(64,520)		Accumulated other comprehensive loss	(40,469)		(36,800)
Retained earnings (deficit)	Retained earnings (deficit)	(4,821,653)		(4,679,889)		Retained earnings (deficit)	(5,611,067)		(5,449,385)
Treasury stock, 0 shares at both March 31, 2022 and December 31, 2021		—		—
Treasury stock, 275 and 10 shares issued at March 31, 2023 and December 31, 2022, respectively						Treasury stock, 275 and 10 shares issued at March 31, 2023 and December 31, 2022, respectively	(13,555)		(536)
Total Ventas stockholders’ equity	Total Ventas stockholders’ equity	10,697,406		10,854,385		Total Ventas stockholders’ equity	9,996,991		10,152,968
Noncontrolling interests	Noncontrolling interests	95,284		91,375		Noncontrolling interests	67,611		68,709
Total equity	Total equity	10,792,690		10,945,760		Total equity	10,064,602		10,221,677
Total liabilities and equity	Total liabilities and equity	$	24,950,107	$	24,717,786	Total liabilities and equity	$	23,994,168	$	24,157,840

See accompanying notes.

VENTAS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts, unaudited)


		For the Three Months Ended March 31,				For the Three Months Ended March 31,
		2022		2021				2023		2022
Revenues	Revenues						Revenues
Rental income:	Rental income:						Rental income:
Triple-net leased	Triple-net leased	$	151,561	$	159,885		Triple-net leased	$	149,739	$	151,561
Office	Office	200,540		197,455			Office	203,004		200,540
		352,101		357,340				352,743		352,101
Resident fees and services	Resident fees and services	651,121		528,650			Resident fees and services	704,993		651,121
Office building and other services revenue		3,949		4,950
Third party capital management revenues							Third party capital management revenues	4,177		3,949
Income from loans and investments	Income from loans and investments	9,847		19,010			Income from loans and investments	13,589		9,847
Interest and other income	Interest and other income	536		341			Interest and other income	1,743		536
Total revenues	Total revenues	1,017,554		910,291			Total revenues	1,077,245		1,017,554
Expenses	Expenses						Expenses
Interest	Interest	110,794		110,767			Interest	128,075		110,794
Depreciation and amortization	Depreciation and amortization	289,064		314,148			Depreciation and amortization	282,119		289,064
Property-level operating expenses:	Property-level operating expenses:						Property-level operating expenses:
Senior living		475,530		417,829
Senior housing							Senior housing	537,222		475,530
Office	Office	63,183		63,946			Office	66,913		63,183
Triple-net leased	Triple-net leased	4,008		4,825			Triple-net leased	3,796		4,008
		542,721		486,600				607,931		542,721
Office building and other services costs		1,313		618
Third party capital management expenses							Third party capital management expenses	1,706		1,313
General, administrative and professional fees	General, administrative and professional fees	42,998		40,309			General, administrative and professional fees	44,798		42,998
Loss on extinguishment of debt, net		—		27,090

Transaction expenses and deal costs	Transaction expenses and deal costs	19,992		4,617			Transaction expenses and deal costs	1,386		19,992
Allowance on loans receivable and investments	Allowance on loans receivable and investments	(54)		(8,902)			Allowance on loans receivable and investments	(8,064)		(54)
Other	Other	(27,190)		(9,428)			Other	7,762		(27,190)
Total expenses	Total expenses	979,638		965,819			Total expenses	1,065,713		979,638
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests		37,916		(55,528)
Income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests							Income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests	11,532		37,916
Loss from unconsolidated entities	Loss from unconsolidated entities	(4,269)		(250)			Loss from unconsolidated entities	(5,623)		(4,269)
Gain on real estate dispositions	Gain on real estate dispositions	2,455		2,533			Gain on real estate dispositions	10,201		2,455
Income tax benefit (expense)		4,490		(2,153)
Income (loss) from continuing operations		40,592		(55,398)
Net income (loss)		40,592		(55,398)
Income tax benefit							Income tax benefit	2,802		4,490
Income from continuing operations							Income from continuing operations	18,912		40,592
Net income							Net income	18,912		40,592
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests	1,860		1,811			Net income attributable to noncontrolling interests	1,395		1,860
Net income (loss) attributable to common stockholders		$	38,732	$	(57,209)
Net income attributable to common stockholders							Net income attributable to common stockholders	$	17,517	$	38,732
Earnings per common share	Earnings per common share						Earnings per common share
Basic:	Basic:						Basic:
Income (loss) from continuing operations		$	0.10	$	(0.15)
Income from continuing operations							Income from continuing operations	$	0.05	$	0.10

Net income (loss) attributable to common stockholders		0.10		(0.15)
Diluted 1:
Income (loss) from continuing operations		$	0.10	$	(0.15)
Net income attributable to common stockholders							Net income attributable to common stockholders	0.04		0.10
Diluted:1							Diluted:1
Income from continuing operations							Income from continuing operations	$	0.05	$	0.10

Net income (loss) attributable to common stockholders		0.10		(0.15)
Net income attributable to common stockholders							Net income attributable to common stockholders	0.04		0.10

______________________________

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

See accompanying notes.

VENTAS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands, unaudited)

For the Three Months Ended March 31,
2022 2021
Net income (loss) $ 40,592 $ (55,398)
Other comprehensive income:
Foreign currency translation loss (9,313) (16)
Unrealized loss on available for sale securities (588) (4,617)
Unrealized gain on derivative instruments 19,036 9,406
Total other comprehensive income 9,135 4,773
Comprehensive income (loss) 49,727 (50,625)
Comprehensive income attributable to noncontrolling interests 5,772 4,726
Comprehensive income (loss) attributable to common stockholders $ 43,955 $ (55,351)


	For the Three Months Ended March 31,
	2023		2022
Net income	$	18,912	$	40,592
Other comprehensive (loss) income:
Foreign currency translation income (loss)	3,899		(9,313)
Unrealized loss on available for sale securities	—		(588)
Unrealized (loss) gain on derivative instruments	(8,802)		19,036
Total other comprehensive (loss) income	(4,903)		9,135
Comprehensive income	14,009		49,727
Comprehensive income attributable to noncontrolling interests	161		5,772
Comprehensive income attributable to common stockholders	$	13,848	$	43,955

See accompanying notes.

VENTAS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

~~For the Three Months Ended March 31, 2022 and 2021~~

(In thousands, except per share amounts, unaudited)


																			For the Three Months Ended March 31, 2023
2019	2019	Common Stock Par Value		Capital in Excess of Par Value		Accumulated Other Comprehensive Loss		Retained Earnings (Deficit)		Treasury Stock		Total Ventas Stockholders’ Equity		Noncontrolling Interests		Total Equity		2019	Common Stock Par Value		Capital in Excess of Par Value		Accumulated Other Comprehensive (Loss) Income		Retained Earnings (Deficit)		Treasury Stock		Total Ventas Stockholders’ Equity		Noncontrolling Interests		Total Equity
Balance at January 1, 2022		$	99,838	$	15,498,956	$	(64,520)	$	(4,679,889)	$	—	$	10,854,385	$	91,375	$	10,945,760
Balance at January 1, 2023																		Balance at January 1, 2023	$	99,912	$	15,539,777	$	(36,800)	$	(5,449,385)	$	(536)	$	10,152,968	$	68,709	$	10,221,677
Net income	Net income	—		—		—		38,732		—		38,732		1,860		40,592		Net income	—		—		—		17,517		—		17,517		1,395		18,912
Other comprehensive income		—		—		5,224		—		—		5,224		3,911		9,135
Other comprehensive loss																		Other comprehensive loss	—		—		(3,669)		—		—		(3,669)		(1,234)		(4,903)

Net change in noncontrolling interests	Net change in noncontrolling interests	—		858		—		—		—		858		(1,862)		(1,004)		Net change in noncontrolling interests	—		1,393		—		—		—		1,393		(1,259)		134
Dividends to common stockholders—$0.45 per share	Dividends to common stockholders—$0.45 per share	—		—		—		(180,496)		—		(180,496)		—		(180,496)		Dividends to common stockholders—$0.45 per share	—		—		—		(179,199)		—		(179,199)		—		(179,199)

Issuance of common stock for stock plans, restricted stock grants and other	Issuance of common stock for stock plans, restricted stock grants and other	50		15,290		—		—		—		15,340		—		15,340		Issuance of common stock for stock plans, restricted stock grants and other	153		17,839		—		—		(13,019)		4,973		—		4,973
Adjust redeemable OP unitholder interests to current fair value	Adjust redeemable OP unitholder interests to current fair value	—		(36,637)		—		—		—		(36,637)		—		(36,637)		Adjust redeemable OP unitholder interests to current fair value	—		3,077		—		—		—		3,077		—		3,077

Balance at March 31, 2022		$	99,888	$	15,478,467	$	(59,296)	$	(4,821,653)	$	—	$	10,697,406	$	95,284	$	10,792,690

Balance at January 1, 2021		$	93,635	$	14,171,262	$	(54,354)	$	(4,030,376)	$	—	$	10,180,167	$	98,024	$	10,278,191
Net (loss) income		—		—		—		(57,209)		—		(57,209)		1,811		(55,398)
Other comprehensive income		—		—		1,857		—		—		1,857		2,916		4,773
Net change in noncontrolling interests		—		3,435		—		—		—		3,435		(1,286)		2,149
Dividends to common stockholders—$0.45 per share		—		47		—		(169,416)		—		(169,369)		—		(169,369)

Issuance of common stock for stock plans, restricted stock grants and other		115		24,882		—		—		(789)		24,208		—		24,208

Adjust redeemable OP unitholder interests to current fair value		—		(12,918)		—		—		—		(12,918)		—		(12,918)
Redemption of OP Units	Redemption of OP Units	—		(16)		—		—		—		(16)		—		(16)		Redemption of OP Units	—		(69)		—		—		—		(69)		—		(69)

Balance at March 31, 2021		$	93,750	$	14,186,692	$	(52,497)	$	(4,257,001)	$	(789)	$	9,970,155	$	101,465	$	10,071,620
Balance at March 31, 2023																		Balance at March 31, 2023	$	100,065	$	15,562,017	$	(40,469)	$	(5,611,067)	$	(13,555)	$	9,996,991	$	67,611	$	10,064,602


	For the Three Months Ended March 31, 2022
	Common Stock Par Value		Capital in Excess of Par Value		Accumulated Other Comprehensive (Loss) Income		Retained Earnings (Deficit)		Treasury Stock		Total Ventas Stockholders’ Equity		Noncontrolling Interests		Total Equity
Balance at January 1, 2022	$	99,838	$	15,498,956	$	(64,520)	$	(4,679,889)	$	—	$	10,854,385	$	91,375	$	10,945,760
Net income	—		—		—		38,732		—		38,732		1,860		40,592
Other comprehensive income	—		—		5,224		—		—		5,224		3,911		9,135

Net change in noncontrolling interests	—		858		—		—		—		858		(1,862)		(1,004)
Dividends to common stockholders—$0.45 per share	—		—		—		(180,496)		—		(180,496)		—		(180,496)

Issuance of common stock for stock plans, restricted stock grants and other	50		15,290		—		—		—		15,340		—		15,340

Adjust redeemable OP unitholder interests to current fair value	—		(36,637)		—		—		—		(36,637)		—		(36,637)



Balance at March 31, 2022	$	99,888	$	15,478,467	$	(59,296)	$	(4,821,653)	$	—	$	10,697,406	$	95,284	$	10,792,690

See accompanying notes.

VENTAS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, unaudited)


		For the Three Months Ended March 31,					For the Three Months Ended March 31,
		2022		2021			2023		2022
Cash flows from operating activities:	Cash flows from operating activities:					Cash flows from operating activities:
Net income (loss)		$	40,592	$	(55,398)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Net income						Net income	$	18,912	$	40,592
Adjustments to reconcile net income to net cash provided by operating activities:						Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	Depreciation and amortization	289,064		314,148		Depreciation and amortization	282,119		289,064
Amortization of deferred revenue and lease intangibles, net	Amortization of deferred revenue and lease intangibles, net	(17,401)		(14,766)		Amortization of deferred revenue and lease intangibles, net	(14,913)		(17,401)
Other non-cash amortization	Other non-cash amortization	3,109		5,272		Other non-cash amortization	4,154		3,109
Allowance on loans receivable and investments	Allowance on loans receivable and investments	(54)		(8,902)		Allowance on loans receivable and investments	(8,064)		(54)
Stock-based compensation	Stock-based compensation	15,796		16,072		Stock-based compensation	15,060		15,796
Straight-lining of rental income	Straight-lining of rental income	(3,841)		(3,863)		Straight-lining of rental income	(445)		(3,841)
Loss on extinguishment of debt, net		—		27,090

Gain on real estate dispositions	Gain on real estate dispositions	(2,455)		(2,533)		Gain on real estate dispositions	(10,201)		(2,455)
Gain on real estate loan investments		—		(74)

Income tax (benefit) expense		(5,805)		503
Loss from unconsolidated entities		4,269		250

Income tax benefit						Income tax benefit	(4,299)		(5,805)
Loss and other from unconsolidated entities						Loss and other from unconsolidated entities	5,623		4,269

Distributions from unconsolidated entities	Distributions from unconsolidated entities	4,356		3,897		Distributions from unconsolidated entities	5,472		4,356

Other	Other	(24,324)		(14,379)		Other	1,526		(24,324)
Changes in operating assets and liabilities:	Changes in operating assets and liabilities:					Changes in operating assets and liabilities:
Increase in other assets	Increase in other assets	(18,177)		(5,100)		Increase in other assets	(16,885)		(18,177)
Decrease in accrued interest	Decrease in accrued interest	(13,201)		(20,234)		Decrease in accrued interest	(17,006)		(13,201)
Increase (decrease) in accounts payable and other liabilities		2,625		(4,390)
(Decrease) increase in accounts payable and other liabilities						(Decrease) increase in accounts payable and other liabilities	(18,236)		2,625
Net cash provided by operating activities	Net cash provided by operating activities	274,553		237,593		Net cash provided by operating activities	242,817		274,553
Cash flows from investing activities:	Cash flows from investing activities:					Cash flows from investing activities:
Net investment in real estate property	Net investment in real estate property	(343,792)		(210)		Net investment in real estate property	—		(343,792)

Investment in loans receivable	Investment in loans receivable	(5,117)		(186)		Investment in loans receivable	(289)		(5,117)
Proceeds from real estate disposals	Proceeds from real estate disposals	6,124		8,083		Proceeds from real estate disposals	46,417		6,124
Proceeds from loans receivable	Proceeds from loans receivable	177		16,419		Proceeds from loans receivable	44,354		177

Development project expenditures	Development project expenditures	(37,591)		(58,598)		Development project expenditures	(69,079)		(37,591)
Capital expenditures	Capital expenditures	(36,728)		(29,674)		Capital expenditures	(43,577)		(36,728)

Investment in unconsolidated entities	Investment in unconsolidated entities	(23,790)		(38,452)		Investment in unconsolidated entities	(35,792)		(23,790)
Insurance proceeds for property damage claims	Insurance proceeds for property damage claims	3,391		6		Insurance proceeds for property damage claims	1,686		3,391
Net cash used in investing activities	Net cash used in investing activities	(437,326)		(102,612)		Net cash used in investing activities	(56,280)		(437,326)
Cash flows from financing activities:	Cash flows from financing activities:					Cash flows from financing activities:
Net change in borrowings under revolving credit facilities	Net change in borrowings under revolving credit facilities	(9,867)		5,144		Net change in borrowings under revolving credit facilities	14,340		(9,867)
Net change in borrowings under commercial paper program	Net change in borrowings under commercial paper program	356,674		214,978		Net change in borrowings under commercial paper program	22,164		356,674
Proceeds from debt	Proceeds from debt	70,029		31,157		Proceeds from debt	343,900		70,029
Repayment of debt	Repayment of debt	(65,000)		(445,050)		Repayment of debt	(343,876)		(65,000)
Purchase of noncontrolling interests	Purchase of noncontrolling interests	(170)		—		Purchase of noncontrolling interests	(110)		(170)
Payment of deferred financing costs	Payment of deferred financing costs	(427)		(17,343)		Payment of deferred financing costs	(4,027)		(427)
Issuance of common stock, net		—		11,075

Cash distribution to common stockholders	Cash distribution to common stockholders	(180,021)		(168,763)		Cash distribution to common stockholders	(181,422)		(180,021)
Cash distribution to redeemable OP unitholders	Cash distribution to redeemable OP unitholders	(1,534)		(1,842)		Cash distribution to redeemable OP unitholders	(1,539)		(1,534)
Cash issued for redemption of OP Units	Cash issued for redemption of OP Units	—		(25)		Cash issued for redemption of OP Units	(655)		—
Contributions from noncontrolling interests	Contributions from noncontrolling interests	19		5		Contributions from noncontrolling interests	2,973		19
Distributions to noncontrolling interests	Distributions to noncontrolling interests	(3,983)		(2,653)		Distributions to noncontrolling interests	(2,566)		(3,983)
Proceeds from stock option exercises	Proceeds from stock option exercises	5,794		2,106		Proceeds from stock option exercises	1,736		5,794
Other	Other	(6,132)		(5,856)		Other	(13,025)		(6,132)
Net cash provided by (used in) financing activities		165,382		(377,067)
Net increase (decrease) in cash, cash equivalents and restricted cash		2,609		(242,086)
Net cash (used in) provided by financing activities						Net cash (used in) provided by financing activities	(162,107)		165,382
Net increase in cash, cash equivalents and restricted cash						Net increase in cash, cash equivalents and restricted cash	24,430		2,609
Effect of foreign currency translation	Effect of foreign currency translation	241		658		Effect of foreign currency translation	106		241
Cash, cash equivalents and restricted cash at beginning of period	Cash, cash equivalents and restricted cash at beginning of period	196,597		451,640		Cash, cash equivalents and restricted cash at beginning of period	170,745		196,597
Cash, cash equivalents and restricted cash at end of period	Cash, cash equivalents and restricted cash at end of period	$	199,447	$	210,212	Cash, cash equivalents and restricted cash at end of period	$	195,281	$	199,447

See accompanying notes.

VENTAS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(In thousands, unaudited)


		For the Three Months Ended March 31,					For the Three Months Ended March 31,
		2022		2021			2023		2022
Supplemental schedule of non-cash activities:	Supplemental schedule of non-cash activities:					Supplemental schedule of non-cash activities:
Assets acquired and liabilities assumed from acquisitions and other:	Assets acquired and liabilities assumed from acquisitions and other:					Assets acquired and liabilities assumed from acquisitions and other:
Real estate investments	Real estate investments	$	3,171	$	468	Real estate investments	$	—	$	3,171

Other assets	Other assets	47		—		Other assets	—		47

Other liabilities	Other liabilities	2,624		—		Other liabilities	—		2,624
Deferred income tax liability	Deferred income tax liability	594		—		Deferred income tax liability	—		594
Noncontrolling interests		—		468

See accompanying notes.

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1—DESCRIPTION OF BUSINESS

Ventas, Inc. (together with its consolidated subsidiaries, unless otherwise indicated or except where the context otherwise requires, “we,” “us,” “our,” “Company” and other similar terms), an S&P 500 company, is a real estate investment trust (“REIT”) operating at the intersection of healthcare and real estate. We hold a highly diversified portfolio of senior housing communities, medical office buildings (“MOBs”), life science, research and innovation centers, hospitals and other healthcare facilities, which we generally refer to collectively as “healthcare real estate,” located throughout the United States, Canada and the United Kingdom. As of March 31, ~~2022,~~2023, we owned or had investments in approximately ~~1,300~~1,200 properties (including properties classified as held for sale). Our company was originally founded in 1983 and is headquartered in Chicago, Illinois with additional corporate offices in Louisville, Kentucky and New York, New York.

We primarily invest in a diversified portfolio of healthcare real estate assets through wholly owned subsidiaries and other co-investment entities. We operate through 3three reportable business segments: triple-net leased properties, senior ~~living operations,~~housing operating portfolio, which we also refer to as ~~SHOP,~~“SHOP” and which was formerly known as senior living operations, and office operations. See “Note 2 – Accounting Policies” and “Note 1615 – Segment Information.” Our senior housing communities are either subject to triple-net leases, in which case they are included in our triple-net leased properties reportable business segment, or operated by independent third-party managers, in which case they are included in our ~~senior living operations~~SHOP reportable business segment.

As of March 31, ~~2022,~~2023, we leased a total of ~~332~~312 properties (excluding properties within our office operations reportable business segment) to various healthcare operating companies under triple-net or absolute-net leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures. Our 3three largest tenants, Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”), Ardent Health Partners, LLC (together with its subsidiaries, “Ardent”) and Kindred Healthcare, LLC (together with its subsidiaries, “Kindred”) leased from us 121 properties, 30 properties (including 19 MOBs) and 29 properties, respectively, as of March 31, ~~2022.~~2023.

As of March 31, ~~2022,~~2023, pursuant to long-term management agreements, we engaged independent operators, such as Atria Senior Living, Inc. (together with its subsidiaries, including Holiday Retirement (“Holiday”), “Atria”) and Sunrise Senior Living, LLC (together with its subsidiaries, “Sunrise”), to manage ~~555~~560 senior housing ~~communities for us.~~communities.

As of March 31, 2023, we owned or had investments in a total of 373 properties in our office operations reportable business segment. These properties generally consist of MOBs that are predominantly located on or contiguous to a health system campus and life science, research and innovation properties that are affiliated with and often located on or contiguous to a university or academic medical campus. Through our Lillibridge Healthcare Services, Inc. subsidiary and our ownership interest in PMB Real Estate Services LLC, we also provide MOB management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States.

In addition, from time to time, we make secured and ~~non-mortgage~~unsecured loans and other investments relating to ~~senior housing and~~ healthcare ~~operators~~real estate or ~~properties.~~operators.

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

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

~~Accounting Considerations.~~We have ~~not identified~~a third-party institutional capital management business, Ventas Investment Management (“VIM”), which includes our open-ended investment vehicle, the ~~COVID-19 pandemic, on its own, as a “triggering event” for purposes of evaluating impairment of~~Ventas Life Science & Healthcare Real Estate Fund (the “Ventas Fund”). Through VIM, we partner with third-party institutional investors to invest in healthcare real estate ~~assets, goodwill~~through various joint ventures and other ~~intangibles, investments in unconsolidated entities and financial instruments. However, as of March 31, 2022,~~co-investment vehicles where we ~~considered~~are the effect of the pandemic on certain of our assets and our ability to recover the respective carrying values of these assets. We applied our considerations to existing critical accounting policies that require us to make estimates and assumptions regarding future events that affect the reported amounts of assets and liabilities. We based our estimates on our experience and on assumptions we believe to be reasonable under the circumstances. For both the three months ended March 31, 2022 and 2021, we recognized no COVID-19 related charges in our Consolidated Statements of Income.

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

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

During the three months ended March 31, 2022 and 2021, we received $34.0 million and $13.6 million, respectively, in grants in connection with our applications and recognized these grants within property-level operating expenses in our Consolidated Statements of Income in the period in which they were received.

~~Continuing Impact.~~ The trajectory and future impact of the COVID-19 pandemic and its extended consequences remain highly uncertain and will depend on a variety of factors, including the impact of new variants of the virus and the effectiveness of available vaccines against those variants; ongoing clinical experience, which may differ considerably across regions and fluctuate over time; and other future developments, including the ultimate duration, spread and intensity of the outbreak, the availability of testing, the extent to which governments impose, roll-back or re-impose preventative restrictions and the availability of ongoing government financial support to our business, tenants and operators. Due to these uncertainties, we are not able at this time to estimate the ultimate impact of the COVID-19 pandemic on our business, results of operations, financial condition and cash flows.

NOTE 2—ACCOUNTING POLICIES

The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”), and with the Securities and Exchange Commission (“SEC”) instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. Operating results for the three months ended March 31, ~~2022~~2023 are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2022.~~2023. The accompanying Consolidated Financial Statements and related notes should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, ~~2021~~2022 (the ~~“2021~~“2022 Annual Report”). Certain prior period amounts have been reclassified to conform to the current period presentation.

Accounting Estimates

The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions regarding future events that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Principles of Consolidation

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

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

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

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

~~We consolidate several VIEs that share the following common characteristics:~~

•~~the VIE is in the legal form of an LP or LLC;~~

•~~the VIE was designed to own and manage its underlying real estate investments;~~

•~~we are the general partner or managing member of the VIE;~~

•~~we own a majority of the voting interests in the VIE;~~

•~~a minority of voting interests in the VIE are owned by external third parties, unrelated to us;~~

•~~the minority owners do not have substantive kick-out or participating rights in the VIE; and~~

•~~we are the primary beneficiary of the VIE.~~

We have separately identified certain special purpose entities that were established to allow investments in life science, research and innovation projects by tax credit investors (“TCIs”). We have determined that these special purpose entities are VIEs, we are a holder of variable interests and we are the primary beneficiaryliabilities of the VIEs and therefore, we consolidate these special purpose entities. Our primary beneficiary determination is based upon several factors, including but not limited to the rights we have in directing the activities which most significantly impact the VIEs’ economic performance as well as certain guarantees which protect the TCIs from losses should a tax credit recapture event occur.

~~In general, the assets of consolidated VIEs~~ are ~~available only for the settlement of the obligations of the respective entities. Unless otherwise required by the LP or LLC agreement, any~~ mortgage ~~loans~~debt. Assets of the consolidated VIEs ~~are non-recourse~~can only be used to ~~us.~~settle obligations of such VIEs. Liabilities of the consolidated VIEs represent claims against the specific assets of the VIEs. The table below summarizes the total assets and liabilities of our consolidated VIEs as reported on our Consolidated Balance Sheets (dollars in thousands):


		As of March 31, 2022				As of December 31, 2021					As of March 31, 2023				As of December 31, 2022
		Total Assets		Total Liabilities		Total Assets		Total Liabilities			Total Assets		Total Liabilities		Total Assets		Total Liabilities
NHP/PMB L.P.	NHP/PMB L.P.	$	752,970	$	250,825	$	749,834	$	251,352	NHP/PMB L.P.	$	746,751	$	253,370	$	741,890	$	252,518
Fonds Immobilier Groupe Maurice, S.E.C.										Fonds Immobilier Groupe Maurice, S.E.C.	1,963,391		1,186,910		1,957,075		1,170,928
Other identified VIEs	Other identified VIEs	3,970,582		1,570,662		3,949,294		1,556,136		Other identified VIEs	1,688,060		326,910		1,699,949		333,185
Tax credit VIEs	Tax credit VIEs	452,646		99,701		458,953		103,992		Tax credit VIEs	123,285		15,707		128,240		16,767

~~Investments in Unconsolidated Entities~~U.S. Department of Health & Human Services Grants

We ~~report investments in unconsolidated entities over whose operating and financial policies we have the ability to exercise significant influence~~applied for grants under the ~~equity method~~Provider Relief Fund administered by the U.S. Department of ~~accounting. We adjust our investment in unconsolidated entities for additional contributions made, distributions received as well as our share~~Health & Human Services (“HHS”) on behalf of the ~~investee’s earnings~~assisted living communities in our SHOP reportable business segment to partially mitigate losses attributable to COVID-19. These grants are intended to reimburse eligible providers for expenses incurred to prevent, prepare for and respond to COVID-19 and lost revenues attributable to COVID-19. Recipients are not required to repay distributions from the Provider Relief Fund, provided that they attest to and comply with certain terms and conditions, including, not using grants received from the Provider Relief Fund to reimburse expenses or losses ~~which is included in loss from unconsolidated entities in our Consolidated Statements of Income.~~that other sources are obligated to reimburse, reporting and record keeping requirements and cooperating with any government audits.

~~We base~~During the ~~initial carrying value of investments in unconsolidated entities on~~three months ended March 31, 2023, we did not receive any HHS grants. During the fair value of the assets at the time we acquired the joint venture interest. We estimate fair values for our equity method investments based on discounted cash flow models that include all estimated cash inflows and outflows over a specified holding period and, where applicable, any estimated debt premiums or discounts. The capitalization rates, discount rates and credit spreads we use in these models are based upon assumptions that we believe to be within a reasonable range of current market rates for the respective investments.

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

~~Redeemable OP Unitholder and Noncontrolling Interests~~

We own a majority interest in NHP/PMB L.P. (“NHP/PMB”), a limited partnership formed in 2008 to acquire properties from entities affiliated with Pacific Medical Buildings LLC (“PMB”). Given our wholly owned subsidiary is the general partner and the primary beneficiary of NHP/PMB, we consolidate NHP/PMB as a VIE. As ofthree months ended March 31, 2022, ~~third party investors owned 3.9~~we received $34.0 million ~~Class A limited partnership units~~ in ~~NHP/PMB (“OP Units”), which represented 34% of the total units then outstanding,~~HHS grants in connection with our applications and we owned 7.5 million Class B limited partnership units in NHP/PMB, representing the remaining 66%. The OP Units may be redeemed at any time at the election of the holder for cash or, at our option, 0.9051 shares of our common stock per OP Unit, subject to adjustment in certain circumstances. We are party by assumption to a registration rights agreement with the holders of the OP Units that requires us, subject to the terms and conditions and certain exceptions set forth therein, to file and maintain a registration statement relating to the issuance of shares of our common stock upon redemption of OP Units.

The OP Units are classified outside of permanent equity on our Consolidated Balance Sheets because they may be redeemed by third parties under circumstances that are outside of our control. We reflect the OP Units at the greater of cost or redemption value. As of March 31, 2022 and December 31, 2021, the fair value of the OP Units was $217.2 million and $182.1 million, respectively. We recognize changes in fair value through capital in excess of par value, net of cash distributions paid and purchases by us of any OP Units. Our diluted earnings per share includes the effect of any potential shares outstanding from redemption of the OP Units.

~~Certain noncontrolling interests of other consolidated joint ventures were also classified as redeemable at March 31, 2022 and December 31, 2021. We record the carrying amount of~~recognized these noncontrolling interests at the greater of their initial carrying amount (increased or decreased for the noncontrolling interests’ share of net income or loss and distributions) or the redemption value, which is primarily based on the fair value of the underlying real estate asset. Our joint venture partners have certain redemption rights with respect to their noncontrolling interests in these joint ventures that are outside of our control, and the redeemable noncontrolling interests are classified outside of permanent equity on our Consolidated Balance Sheets. We recognize changes in the carrying value of redeemable noncontrolling interests through capital in excess of par value on our Consolidated Balance Sheets.

~~Noncontrolling Interests~~

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

~~Accounting for Historic and New Markets Tax Credits~~

For certain of our life science, research and innovation centers, we are party to contractual arrangements with TCIs that were established to enable the TCIs to receive benefits of historic tax credits (“HTCs”), new markets tax credits (“NMTCs”) or both. As of March 31, 2022, we owned 6 properties that had syndicated HTCs or NMTCs, or both, to TCIs.

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

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

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

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

~~Accounting for Real Estate Acquisitions~~

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

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

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

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

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

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

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

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

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

~~Fair Values of Financial Instruments~~

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

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

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

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

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

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

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

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

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

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

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

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

•~~Senior notes payable and other debt -~~ We estimate the fair value of senior notes payable and other debt using level two inputs. We discount the future cash flows using current interest rates at which we could obtain similar borrowings. For mortgage debt, we may estimate fair value using level three inputs, similar to those used in determining fair value of loans receivable (above).

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

~~Impairment of Long-Lived and Intangible Assets~~

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

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

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

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

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

138

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

~~Revenue Recognition~~

~~Triple-Net Leased Properties and Office Operations~~

Certain of our triple-net leases and most of our MOB and life science, research and innovation centers (collectively, “office operations”) leases provide for periodic and determinable increases in base rent. We recognize base rental revenues under these leases on a straight-line basis over the applicable lease term when collectability of substantially all rents is probable. Recognizing rental income on a straight-line basis generally results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in other assets on our Consolidated Balance Sheets. At March 31, 2022 and December 31, 2021, this cumulative excess totaled $180.0 million and $176.9 million, respectively (excluding properties classified as held for sale).

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

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

~~Senior Living Operations~~

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

~~Other~~

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

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

~~Accounting for Leased Property~~

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

~~Recently Issued Accounting Standards~~

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

NOTE 3—CONCENTRATION OF CREDIT RISK

As of March 31, ~~2022,~~2023, Atria, Sunrise, Brookdale Senior Living, Ardent and Kindred managed or operated approximately ~~26.7%~~26.0%, 9.9%, ~~7.7%~~7.8%, 5.3% and 0.8%, respectively, of our consolidated real estate investments based on gross book value (excluding properties classified as held for sale as of March 31, ~~2022)~~2023). Because Atria and Sunrise manage our properties in exchange for a management fee from us, we are not directly exposed to their credit risk in the same manner or to the same extent as triple-net tenants like Brookdale Senior Living, Ardent and Kindred.

Based on gross book value, approximately ~~12.8%~~11.7% and ~~54.2%~~54.7% of our consolidated real estate investments were senior housing communities included in the triple-net leased properties and ~~senior living operations~~SHOP reportable business segments, respectively (excluding properties classified as held for sale as of March 31, ~~2022)~~2023). MOBs, life science, research and innovation centers, inpatient rehabilitation facilities (“IRFs”) and long-term acute care facilities (“LTACs”), health systems, skilled nursing facilities (“SNFs”) and secured loans receivable and investments collectively comprised the remaining ~~33.0%~~33.6%. Our consolidated properties were located in 47 states, the District of Columbia, 7seven Canadian provinces and the United Kingdom as of March 31, ~~2022,~~2023, with properties in 1one state (California) accounting for more than 10% of our total consolidated revenues and net operating income (“~~NOI”) for the three months then ended.~~ NOI,” which is defined as total revenues, less interest and other income, property-level operating expenses and ~~office building~~third party capital management expenses) for each of the three months ended March 31, 2023 and ~~other services costs.~~2022. See “Non-GAAP Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure and a reconciliation of net income attributable to common stockholders, as computed in accordance with GAAP, to NOI.

Triple-Net Leased Properties

The properties we lease to Brookdale Senior Living, Ardent and Kindred accounted for a significant portion of our triple-net leased properties segment revenues and NOI for the three months ended March 31, ~~2022~~2023 and ~~2021.~~2022. The following table reflects the concentration risk related to our triple-net leased properties including assets held for sale for the periods presented:


		For the Three Months Ended March 31,					For the Three Months Ended March 31,
		2022		2021			2023		2022
Revenues (1):	Revenues (1):					Revenues (1):
Brookdale Senior Living	Brookdale Senior Living	3.7	%	4.1	%	Brookdale Senior Living	3.5	%	3.7	%
Ardent	Ardent	3.2		3.5		Ardent	3.1		3.2
Kindred	Kindred	3.3		3.6		Kindred	3.0		3.3
NOI (2):	NOI (2):					NOI (2):
Brookdale Senior Living	Brookdale Senior Living	7.8	%	8.8	%	Brookdale Senior Living	8.0	%	7.8	%
Ardent	Ardent	6.8		7.5		Ardent	7.1		6.8
Kindred	Kindred	7.0		7.8		Kindred	7.0		7.0

(1)Total revenues include ~~office building and other services revenue,~~third party capital management revenues, income from loans and investments and interest and other income.

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

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

159

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

~~In December 2021,~~ Kindred Healthcare, LLC was acquired and began operating under a new healthcare system called ScionHealth. As of March 31, 2022, we leased 29 LTACs to Kindred pursuant to a master lease agreement. Unless extended, the lease term for 6 of the LTACs ends on April 30, 2023 (the “2023 Pool”) and the lease term for the remaining LTACs ends on April 30, 2025. Although Kindred has the right to renew each pool of LTACs for an additional lease term, we cannot assure you that Kindred will exercise its renewal option for either pool. Annual rent for the LTACs in the 2023 Pool for the 12-month period ending on March 31, 2022 was $31.9 million.

~~Senior Living Operations~~Lease

As of March 31, ~~2022,~~2023, we leased 29 properties to Kindred pursuant to a single, triple-net master lease agreement (together with certain other agreements related to such master lease, collectively, the “Kindred Lease”). Pursuant to the Kindred Lease, the 29 properties are divided into two groups. The first group is composed of 6 properties (“Group 1”) and the second group is composed of 23 properties (“Group 2”). The existing term of the Kindred Lease expires on April 30, 2028 for Group 1 and April 30, 2025 for Group 2. Kindred has the option to renew the Group 1 properties for two, 5-year extension at the greater of escalated rent and fair market rental. Kindred has the option to renew the Group 2 properties for one, 5-year extension at escalated rent, and following that, two additional 5-year extensions at the greater of escalated rent and fair market rent. The Kindred Lease is guaranteed by a parent company.

Senior Housing Operating Portfolio

As of March 31, 2023, Atria and Sunrise, collectively, provided comprehensive property management and accounting services with respect to ~~347~~334 of our ~~546~~551 consolidated senior housing communities, for which we pay annual management fees pursuant to long-term management agreements.

~~On July 30, 2021, Atria acquired the management services division of Holiday, which at the time managed a pool of 26 communities for Ventas.~~ As of March 31, ~~2022,~~2023, Atria and its subsidiaries, including Holiday, managed a pool of ~~255~~242 senior housing communities for Ventas. Ventas has the ongoing right to terminate the management contract for 91 of the communities with short term notice.

As of March 31, ~~2022,~~2023, Sunrise managed ~~a pool of 96 senior housing~~92 communities for ~~Ventas. Subsequent~~Ventas pursuant to ~~March 31, 2022, Ventas~~multiple management agreements (collectively, the “Sunrise Management Agreements”). Our Sunrise Management Agreements have initial terms expiring between 2035 and Sunrise Senior Living entered into a revised management agreement for 92 communities with a term expiring May 31, 2035. Under the new management agreement, Sunrise will receive a management fee based on a percentage of revenue and net operating income generated by the applicable communities. Sunrise is also entitled to certain incentive fees if specified performance targets are met.2040. Ventas has the ~~right~~ability to ~~freely~~ terminate some or all of the ~~management agreement as to all communities if~~Sunrise Management Agreements upon certain performance metrics are not met and may freely terminate the management agreement as to certain specified communities at any time. In addition, Ventas may also terminate the management agreement as it relates to three communities per year subject tocircumstances with or without the payment of a ~~fee and an aggregate cap on such terminations over the term of the agreement.~~

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

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

NOTE 4—~~ACQUISITIONS OF REAL ESTATE PROPERTY~~DISPOSITIONS AND IMPAIRMENTS

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

~~2022 Acquisitions~~2023 Activity

During the ~~first quarter of 2022,~~three months ended March 31, 2023, we ~~acquired 18 MOBs leased to affiliates of Ardent and 1 behavioral health center, all~~sold five senior housing communities (three of which ~~are reported within~~were vacant), four MOBs and two vacant triple-net leased properties for aggregate consideration of $46.4 million and recognized a net gain on the sale of these assets of $10.2 million in our ~~office operations segment, and 1 senior housing community, which is reported within our senior living operations segment, for an aggregate purchase price~~Consolidated Statements of ~~$349.2 million.~~

~~Subsequent to March 31, 2022, we acquired 1 research and innovation center in Philadelphia, Pennsylvania for $46.1 million.~~Income.

1610

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

~~NOTE 5—DISPOSITIONS AND IMPAIRMENTS~~

~~2022 Activity~~

~~During the three months ended March 31, 2022, we sold 1 vacant land parcel for $5.6 million and recognized a gain on the sale of this asset of $2.2 million.~~

Assets Held for Sale

The table below summarizes our real estate assets classified as held for sale including the amounts reported on our Consolidated Balance Sheets, which may include anticipated post-closing settlements of working capital for disposed properties (dollars in thousands):

As of March 31, 2022 As of December 31, 2021
Number of Properties Held for Sale Assets Held for Sale Liabilities Related to Assets
Held for Sale Number of Properties Held for Sale Assets Held for Sale Liabilities Related to Assets
Held for Sale
Office Operations 2 3,098 1,558 2 3,435 1,529
Senior Living Operations 2 23,133 6,853 2 24,964 9,321
Total 4 $ 26,231 $ 8,411 4 $ 28,399 $ 10,850


	As of March 31, 2023					As of December 31, 2022
	Number of Properties Held for Sale	Assets Held for Sale		Liabilities Related to Assets Held for Sale		Number of Properties Held for Sale	Assets Held for Sale		Liabilities Related to Assets Held for Sale
SHOP	2	$	20,209	$	3,557	3	$	44,852	$	5,675
Office operations	—	24		855		—	41		817

Total	2	$	20,233	$	4,412	3	$	44,893	$	6,492

Real Estate Impairment

We recognized impairments of ~~$14.3~~$8.6 million and ~~$78.5~~$14.3 million for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively, which are recorded primarily as a component of depreciation and amortization in our Consolidated Statements of Income. The impairments recorded were primarily ~~the~~a result of a change in our intent to hold ~~the impaired assets~~ or a change in the ~~expected~~ future cash flows of the ~~subject properties.~~impaired assets.

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

NOTE 6—5—LOANS RECEIVABLE AND INVESTMENTS

As of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, we had ~~$554.5~~$525.4 million and ~~$549.2~~$561.4 million, respectively, of ~~net~~ loans receivable and investments, net of allowance, relating to senior housing and healthcare operators or properties. The following is a summary of our loans receivable and investments, net, including amortized cost, fair value and unrealized gains or losses on available for sale investments (dollars in thousands):

Amortized Cost Allowance Unrealized Gain Carrying Amount Fair Value
As of March 31, 2022:
Secured/mortgage loans and other, net $ 488,827 $ — $ — $ 488,827 $ 483,491
Government-sponsored pooled loan investments, net (1)
40,312 — 1,249 41,561 41,561
Total investments reported as secured loans receivable and investments, net 529,139 — 1,249 530,388 525,052
Non-mortgage loans receivable, net (2)
29,449 (5,333) — 24,116 23,826
Total loans receivable and investments, net $ 558,588 $ (5,333) $ 1,249 $ 554,504 $ 548,878
As of December 31, 2021:
Secured/mortgage loans and other, net $ 488,913 $ — $ — $ 488,913 $ 478,931
Government-sponsored pooled loan investments, net (1)
39,376 — 1,836 41,213 41,213
Total investments reported as secured loans receivable and investments, net 528,289 — 1,836 530,126 520,144
Non-mortgage loans receivable, net (2)
24,418 (5,394) — 19,024 19,039
Total loans receivable and investments, net $ 552,707 $ (5,394) $ 1,836 $ 549,150 $ 539,183


	Amortized Cost		Allowance		Carrying Amount		Fair Value
As of March 31, 2023:
Secured/mortgage loans and other, net (1)	$	513,004	$	(12,000)	$	501,004	$	501,073


Non-mortgage loans receivable, net (3)	28,975		(4,557)		24,418		23,585

Total loans receivable and investments, net	$	541,979	$	(16,557)	$	525,422	$	524,658
As of December 31, 2022:
Secured/mortgage loans and other, net (1)	$	513,669	$	(20,000)	$	493,669	$	493,627
Government-sponsored pooled loan investments, net (2)	43,406		—		43,406		43,406
Total investments reported as secured loans receivable and investments, net	557,075		(20,000)		537,075		537,033
Non-mortgage loans receivable, net (3)	28,959		(4,621)		24,338		23,416
Total loans receivable and investments, net	$	586,034	$	(24,621)	$	561,413	$	560,449

(1)~~Investment~~Includes the Company’s cash-pay non-recourse mezzanine loan to Santerre Health Investors (the “Santerre Mezzanine Loan”), which is no longer outstanding. Other included investments have contractual maturities in ~~government-sponsored pool loans has a contractual maturity date~~2024 and 2027.

(2)Repaid at par in February 2023.

~~(2)~~(3)Included in other assets on our Consolidated Balance Sheets.

On May 1, 2023, we took ownership of the collateral that supported the Santerre Mezzanine Loan by converting the outstanding principal amount of the Santerre Mezzanine Loan to equity, with no additional consideration being paid. As a result, the Santerre Mezzanine Loan is no longer outstanding. The properties consist of a diverse pool of medical office buildings, senior housing operating portfolio communities, triple-net leased skilled nursing facilities and hospital assets in the United States (such assets, collectively, the “Santerre Portfolio”). Our ownership of the Santerre Portfolio is subject to an existing approximately $1 billion non-recourse senior loan (the “Santerre Senior Loan”). See “Note 9 – Senior Notes Payable And Other Debt.”

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

As of December 31, 2022, we recognized a $20.0 million allowance on the Santerre Mezzanine Loan in our Consolidated Statements of Income. The allowance for the Santerre Mezzanine Loan was calculated using the “current expected credit loss”, or “CECL”, model, which considers relevant information about past events, current conditions and reasonable and supportable forecasts to estimate expected losses as of the most recent balance sheet date. During the three months ended March 31, 2023, we recorded an $8.0 million partial reversal of the allowance in our Consolidated Statements of Income resulting in a $12.0 million allowance as of March 31, 2023, primarily due to a change in the fair value of the Santerre Senior Loan and working capital.

NOTE 7—6—INVESTMENTS IN UNCONSOLIDATED ENTITIES

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

Investments in Unconsolidated Real Estate Entities

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

Below is a summary of our investments in unconsolidated real estate entities as of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively (dollars in thousands):


		Ownership as of (1)		Carrying Amount as of					Ownership as of (1)		Carrying Amount as of
		March 31, 2022	December 31, 2021	March 31, 2022		December 31, 2021			March 31, 2023	December 31, 2022	March 31, 2023		December 31, 2022
Investment in unconsolidated real estate entities:	Investment in unconsolidated real estate entities:							Investment in unconsolidated real estate entities:
Ventas Life Science & Healthcare Real Estate Fund	Ventas Life Science & Healthcare Real Estate Fund	21.1%	21.1%	$	264,675	$	267,475	Ventas Life Science & Healthcare Real Estate Fund	21.0%	21.0%	$	261,319	$	263,979
Pension Fund Joint Venture	Pension Fund Joint Venture	22.9%	22.9%	28,248		29,192		Pension Fund Joint Venture	23.3%	22.9%	28,490		25,028
Research & Innovation Development Joint Venture	Research & Innovation Development Joint Venture	51.1%	51.0%	244,115		221,363		Research & Innovation Development Joint Venture	51.5%	51.0%	307,791		284,962
Ventas Investment Management Platform	Ventas Investment Management Platform			537,038		518,030		Ventas Investment Management Platform			597,600		573,969
Atrium Health & Wake Forest Joint Venture								Atrium Health & Wake Forest Joint Venture	48.5%	48.5%	9,359		5,403
All other (2)	All other (2)	34.0%-50.0%	34.0%-50.0%	4,876		5,435		All other (2)	34.0%-38.0%	34.0%-38.0%	(953)		577
Total investments in unconsolidated real estate entities	Total investments in unconsolidated real estate entities			$	541,914	$	523,465	Total investments in unconsolidated real estate entities			$	606,006	$	579,949
______________________________
(1) The entities in which we have an ownership interest may have less than a 100% interest in the underlying real estate. The ownership percentages in the table reflect our interest in the underlying real estate. Joint venture members, including us in some instances, have equity participation rights based on the underlying performance of the investments which could result in non pro rata distributions.
(2) Includes investments in land parcels, parking structures and other de minimis investments in unconsolidated real estate entities.

(1) The entities in which we have an ownership interest may have less than a 100% interest in the underlying real estate. The ownership percentages in the table reflect our interest in the underlying real estate. Joint venture members, including us in some instances, have equity participation rights based on the underlying performance of the investments, which could result in non pro rata distributions.

(2) Includes investments in land parcels, parking structures and other de minimis investments in unconsolidated real estate entities.

We provide various services to our unconsolidated real estate entities in exchange for fees and reimbursements. Total management fees earned in connection with these services were ~~$3.5~~$3.6 million and ~~$2.7~~$3.5 million for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively. Such amounts are included in ~~office building and other services revenue~~third party capital management revenues in our Consolidated Statements of Income.

Investments in Unconsolidated Operating Entities

We own investments in unconsolidated operating entities such as Ardent and Atria, which are included within other assets on our Consolidated Balance Sheets. Our 34% ownership interest in Atria entitles us to customary minority rights and protections, including the right to appoint 2two members to the Atria Board of Directors. ~~Our~~

As of March 31, 2023, we held a 9.8% ownership interest in Ardent, ~~entitles~~which entitled us to customary minority rights and protections, including the right to appoint 1one member ofto the Ardent Board of Directors.

In May 2023, we sold

1912

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

approximately 24% of our ownership interest in Ardent to a third-party investor for approximately $50 million in total proceeds. As a result of the sale, we expect to recognize approximately $34 million of gain in the second quarter of 2023 in income from unconsolidated entities in our Consolidated Statements of Income and our ownership interest in Ardent will be reduced to approximately 7.5%. Following the transaction, we continue to have the same minority rights and protections, including the right to appoint one member to the Ardent Board of Directors.

NOTE 8—7—INTANGIBLES

The following is a summary of our intangibles (dollars in thousands):


		As of March 31, 2022			As of December 31, 2021				As of March 31, 2023			As of December 31, 2022
		Balance		Weighted Average Remaining Amortization Period in Years	Balance		Weighted Average Remaining Amortization Period in Years		Balance		Weighted Average Remaining Amortization Period in Years	Balance		Weighted Average Remaining Amortization Period in Years
Intangible assets:	Intangible assets:							Intangible assets:
Above-market lease intangibles (1)	Above-market lease intangibles (1)	$	129,118	5.8	$	129,121	5.9	Above-market lease intangibles (1)	$	128,867	5.2	$	129,038	5.4
In-place and other lease intangibles (2)	In-place and other lease intangibles (2)	1,244,246		7.1	1,240,626		7.2	In-place and other lease intangibles (2)	1,216,548		8.4	1,217,152		8.0
Goodwill	Goodwill	1,045,663		N/A	1,046,140		N/A	Goodwill	1,044,699		N/A	1,044,415		N/A
Other intangibles (2)	Other intangibles (2)	34,536		6.3	34,517		6.5	Other intangibles (2)	34,408		5.4	34,404		5.6
Accumulated amortization	Accumulated amortization	(977,491)		N/A	(944,403)		N/A	Accumulated amortization	(1,093,129)		N/A	(1,061,305)		N/A
Net intangible assets	Net intangible assets	$	1,476,072	7.0	$	1,506,001	7.1	Net intangible assets	$	1,331,393	8.1	$	1,363,704	7.8
Intangible liabilities:	Intangible liabilities:							Intangible liabilities:
Below-market lease intangibles (1)	Below-market lease intangibles (1)	$	334,347	9.5	$	334,365	9.7	Below-market lease intangibles (1)	$	333,652	8.5	$	333,672	8.6
Other lease intangibles	Other lease intangibles	13,498		N/A	13,608		N/A	Other lease intangibles	13,498		N/A	13,498		N/A
Accumulated amortization	Accumulated amortization	(248,092)		N/A	(244,975)		N/A	Accumulated amortization	(262,169)		N/A	(258,639)		N/A
Purchase option intangibles	Purchase option intangibles	3,568		N/A	3,568		N/A	Purchase option intangibles	3,568		N/A	3,568		N/A
Net intangible liabilities	Net intangible liabilities	$	103,321	9.5	$	106,566	9.7	Net intangible liabilities	$	88,549	8.5	$	92,099	8.6

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

(2) Amortization of lease intangibles is recorded in depreciation and amortization in our Consolidated Statements of Income.

N/A—Not ~~Applicable.~~Applicable

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

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 9—8—OTHER ASSETS

The following is a summary of our other assets (dollars in thousands):


		As of March 31, 2022		As of December 31, 2021			As of March 31, 2023		As of December 31, 2022
Straight-line rent receivables	Straight-line rent receivables	$	179,997	$	176,877	Straight-line rent receivables	$	190,635	$	187,536
Non-mortgage loans receivable, net	Non-mortgage loans receivable, net	24,116		19,024		Non-mortgage loans receivable, net	24,418		24,338
Stock warrants	Stock warrants	77,452		48,884		Stock warrants	24,592		23,621

Other intangibles, net	Other intangibles, net	7,072		7,270		Other intangibles, net	6,189		6,393
Investment in unconsolidated operating entities	Investment in unconsolidated operating entities	71,511		73,602		Investment in unconsolidated operating entities	93,609		95,363
Other	Other	252,943		239,412		Other	277,304		272,572
Total other assets	Total other assets	$	613,091	$	565,069	Total other assets	$	616,747	$	609,823

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

2014

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE ~~10—~~9—SENIOR NOTES PAYABLE AND OTHER DEBT

The following is a summary of our senior notes payable and other debt (dollars in thousands):


		As of March 31, 2022		As of December 31, 2021			As of March 31, 2023		As of December 31, 2022
Unsecured revolving credit facility ~~(1)~~(2)	Unsecured revolving credit facility ~~(1)~~(2)	$	46,037	$	56,448	Unsecured revolving credit facility ~~(1)~~(2)	$	40,210	$	25,230
Commercial paper notes	Commercial paper notes	636,948		280,000		Commercial paper notes	425,000		403,000
Unsecured term loan due 2023		200,000		200,000

2.55% Senior Notes, Series D due 2023 (2)	2.55% Senior Notes, Series D due 2023 (2)	220,018		217,667		2.55% Senior Notes, Series D due 2023 (2)	—		202,967
3.50% Senior Notes due 2024	3.50% Senior Notes due 2024	400,000		400,000		3.50% Senior Notes due 2024	400,000		400,000
3.75% Senior Notes due 2024	3.75% Senior Notes due 2024	400,000		400,000		3.75% Senior Notes due 2024	400,000		400,000
4.125% Senior Notes, Series B due 2024 (2)	4.125% Senior Notes, Series B due 2024 (2)	200,016		197,879		4.125% Senior Notes, Series B due 2024 (2)	184,980		184,515
2.80% Senior Notes, Series E due 2024 (2)	2.80% Senior Notes, Series E due 2024 (2)	480,038		474,909		2.80% Senior Notes, Series E due 2024 (2)	443,951		442,837
Unsecured term loan due 2025 (2)	Unsecured term loan due 2025 (2)	400,032		395,757		Unsecured term loan due 2025 (2)	369,959		369,031
3.50% Senior Notes due 2025	3.50% Senior Notes due 2025	600,000		600,000		3.50% Senior Notes due 2025	600,000		600,000
2.65% Senior Notes due 2025	2.65% Senior Notes due 2025	450,000		450,000		2.65% Senior Notes due 2025	450,000		450,000
4.125% Senior Notes due 2026	4.125% Senior Notes due 2026	500,000		500,000		4.125% Senior Notes due 2026	500,000		500,000
3.25% Senior Notes due 2026	3.25% Senior Notes due 2026	450,000		450,000		3.25% Senior Notes due 2026	450,000		450,000
Unsecured term loan due 2027						Unsecured term loan due 2027	500,000		500,000
2.45% Senior Notes, Series G due 2027 (2)	2.45% Senior Notes, Series G due 2027 (2)	380,030		375,970		2.45% Senior Notes, Series G due 2027 (2)	351,461		350,579
3.85% Senior Notes due 2027	3.85% Senior Notes due 2027	400,000		400,000		3.85% Senior Notes due 2027	400,000		400,000
4.00% Senior Notes due 2028	4.00% Senior Notes due 2028	650,000		650,000		4.00% Senior Notes due 2028	650,000		650,000
4.40% Senior Notes due 2029	4.40% Senior Notes due 2029	750,000		750,000		4.40% Senior Notes due 2029	750,000		750,000
3.00% Senior Notes due 2030	3.00% Senior Notes due 2030	650,000		650,000		3.00% Senior Notes due 2030	650,000		650,000
4.75% Senior Notes due 2030	4.75% Senior Notes due 2030	500,000		500,000		4.75% Senior Notes due 2030	500,000		500,000
2.50% Senior Notes due 2031	2.50% Senior Notes due 2031	500,000		500,000		2.50% Senior Notes due 2031	500,000		500,000
3.30% Senior Notes, Series H due 2031 (2)	3.30% Senior Notes, Series H due 2031 (2)	240,019		237,454		3.30% Senior Notes, Series H due 2031 (2)	221,976		221,419
6.90% Senior Notes due 2037 (3)	6.90% Senior Notes due 2037 (3)	52,400		52,400		6.90% Senior Notes due 2037 (3)	52,400		52,400
6.59% Senior Notes due 2038 (3)	6.59% Senior Notes due 2038 (3)	22,823		22,823		6.59% Senior Notes due 2038 (3)	22,823		22,823
5.70% Senior Notes due 2043	5.70% Senior Notes due 2043	300,000		300,000		5.70% Senior Notes due 2043	300,000		300,000
4.375% Senior Notes due 2045	4.375% Senior Notes due 2045	300,000		300,000		4.375% Senior Notes due 2045	300,000		300,000
4.875% Senior Notes due 2049	4.875% Senior Notes due 2049	300,000		300,000		4.875% Senior Notes due 2049	300,000		300,000
Mortgage loans and other	Mortgage loans and other	2,449,515		2,431,831		Mortgage loans and other	2,644,183		2,436,443
Total	Total	12,477,876		12,093,138		Total	12,406,943		12,361,244
Deferred financing costs, net	Deferred financing costs, net	(67,022)		(69,925)		Deferred financing costs, net	(62,321)		(63,410)
Unamortized fair value adjustment	Unamortized fair value adjustment	30,581		32,888		Unamortized fair value adjustment	21,485		23,535
Unamortized discounts	Unamortized discounts	(27,692)		(28,557)		Unamortized discounts	(23,601)		(24,589)
Senior notes payable and other debt	Senior notes payable and other debt	$	12,413,743	$	12,027,544	Senior notes payable and other debt	$	12,342,506	$	12,296,780

(1)As of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively, ~~$21.6~~$18.5 million and ~~$30.9~~$3.7 million of aggregate borrowings were denominated in Canadian dollars. Aggregate borrowings of ~~$24.4~~$21.7 million and ~~$25.6~~$21.5 million were denominated in British pounds as of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively.

(2)British Pound and Canadian Dollar debt obligations shown in ~~U.S.~~US Dollars.

(3)Our 6.90% senior notes due 2037 are subject to repurchase at the option of the holders, at par, on October 1, 2027, and our 6.59% senior notes due 2038 are subject to repurchase at the option of the holders, at par, on July 7 in each of 2023 and 2028.

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Credit Facilities, Commercial Paper, ~~and~~ Unsecured Term Loans and Letters of Credit

We have a $2.75 billion unsecured revolving credit facility initially priced at LIBOR plus 0.825% based on the Company’s debt rating. The unsecured revolving credit facility matures in January 2025, but may be extended at our option, subject to the satisfaction of certain conditions, for 2two additional periods of six months each. The unsecured revolving credit facility also includes an accordion feature that permits us to increase our aggregate borrowing capacity thereunder to up to $3.75 billion, subject to the satisfaction of certain ~~conditions.~~conditions, including the receipt of additional commitments for such increase.

Our unsecured credit facility imposed certain customary restrictions on us, including restrictions pertaining to: (i) liens; (ii) investments; (iii) the incurrence of additional indebtedness; (iv) mergers and dissolutions; (v) certain dividend, distribution and other payments; (vi) permitted businesses; (vii) transactions with affiliates; (viii) agreements limiting certain liens; and (ix) the maintenance of certain consolidated total leverage, secured debt leverage, unsecured debt leverage and fixed charge coverage ratios and minimum consolidated adjusted net worth, and contains customary events of default.

As of March 31, ~~2022,~~2023, we had $2.7 billion of undrawn capacity on our unsecured revolving credit facility with ~~$46.0~~$40.2 million ~~borrowings~~ outstanding and an additional ~~$25.0~~$1.2 million restricted to support outstanding letters of credit. We limit our use of the unsecured revolving credit facility, to the extent necessary, to support our commercial paper program when commercial paper notes are outstanding.

As of March 31, 2023, our $100.0 million uncommitted line for standby letters of credit had an outstanding balance of $14.5 million. The agreement governing the line contains certain customary covenants and, under its terms, we are required to pay a commission on each outstanding letter of credit at a fixed rate.

Our wholly owned subsidiary, Ventas Realty, Limited Partnership (“Ventas Realty”), may issue from time to time unsecured commercial paper notes up to a maximum aggregate amount outstanding at any time of $1.0 billion. The notes are sold under customary terms in the U.S. commercial paper note market and are ranked pari passu with all of Ventas Realty’s other unsecured senior indebtedness. The notes are fully and unconditionally guaranteed by Ventas, Inc. As of March 31, ~~2022,~~2023, we had ~~$636.9~~$425.0 million in borrowings outstanding under our commercial paper program.

As of March 31, 2022, we had a $200.0 million unsecured term loan priced at LIBOR plus 0.90% that matures in 2023. The term loan also includes an accordion feature that effectively permits us to increase our aggregate borrowings thereunder to up to $800.0 million, subject to the satisfaction of certain conditions.

~~As of March 31, 2022,~~2023, we had a C$500.0 million unsecured term loan facility priced at Canadian Dollar Offered Rate (“CDOR”) plus 0.90% that matures in 2025.

Senior Notes

In April 2023, our 100% owned subsidiary, Ventas Canada Finance Limited (“Ventas Canada”), issued and sold C$600.0 million aggregate principal amount of 5.398% Senior Notes due 2028 in a private placement at par. Pursuant to cash tender offers, we used the proceeds to repurchase C$613.7 million in aggregate principal amount of outstanding senior notes due in 2024 for an aggregate purchase price of C$600.0 million plus accrued and unpaid interest as disclosed below:

•In April 2023, we repurchased C$527.0 million principal amount of our 2.80% Senior Notes, Series E due April 2024 at 97.6% of par value, plus accrued and unpaid interest to, but not including, the settlement date.

•In April 2023, we repurchased C$86.7 million principal amount of our 4.125% Senior Notes, Series B due September 2024 at 98.5% of par value, plus accrued and unpaid interest to, but not including, the settlement date.

Mortgages

In March 2023, we entered into a C$271.8 million floating rate mortgage debt maturing in 2028 with an interest rate of CDOR + 0.88%. The mortgage is secured by 14 SHOP communities in Canada.

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

On May 1, 2023, we took ownership of the collateral that supported the Santerre Mezzanine Loan, which we refer to as the Santerre Portfolio, by converting the outstanding principal amount of the Santerre Mezzanine Loan to equity, with no additional consideration being paid. Our ownership of the Santerre Portfolio is subject to an existing approximately $1 billion non-recourse Santerre Senior Loan, which is secured by the Santerre Portfolio, bears interest at a current weighted average rate of LIBOR + 1.84% and matures on June 9, 2023. We have given notice to extend the maturity of the Santerre Senior Loan to June 2024, which is subject to the satisfaction of certain conditions, including entering into an interest rate cap for the extension period. The Santerre Senior Loan can be repaid in whole or in part prior to its maturity, without penalty, and assets can be released from the liens, subject to certain conditions.

As of March 31, ~~2022,~~2023, our indebtedness had the following maturities (dollars in thousands):


		Principal Amount Due at Maturity		Unsecured Revolving Credit Facility and Commercial Paper Notes (1)		Scheduled Periodic Amortization		Total Maturities			Principal Amount Due at Maturity		Unsecured Revolving Credit Facility and Commercial Paper Notes (1)(2)		Scheduled Periodic Amortization		Total Maturities
2022		$	342,600	$	636,948	$	40,477	$	1,020,025
2023	2023	700,088		—		40,291		740,379		2023	$	133,125	$	—	$	40,145	$	173,270
2024	2024	1,666,791		—		34,504		1,701,295		2024	1,704,464		—		48,983		1,753,447
2025	2025	2,052,522		46,037		28,354		2,126,913		2025	2,017,550		465,210		43,802		2,526,562
2026	2026	1,036,035		—		21,441		1,057,476		2026	1,049,484		—		37,605		1,087,089
2027										2027	1,329,048		—		37,348		1,366,396
Thereafter	Thereafter	5,713,952		—		117,836		5,831,788		Thereafter	5,347,575		—		152,604		5,500,179
Total maturities	Total maturities	$	11,511,988	$	682,985	$	282,903	$	12,477,876	Total maturities	$	11,581,246	$	465,210	$	360,487	$	12,406,943

(1)At March 31, ~~2022,~~2023, we had ~~$533.4~~$319.9 million of borrowings outstanding under our unsecured revolving credit facility and commercial paper program, net of ~~$149.6~~$145.4 million of unrestricted cash and cash equivalents.

(2) Commercial paper program borrowings are backstopped by the revolving credit facility. As such, our commercial paper program balances are presented at the maturity date of the revolving credit facility.

Derivatives and Hedging

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

We do not use derivative instruments for trading or speculative purposes, and we have a policy of entering into contracts only with major financial institutions based upon their credit ratings and other factors. When considered together with the underlying exposure that the derivative is designed to hedge, we do not expect that the use of derivatives in this manner would have any material adverse effect on our future financial condition or results of operations.

As of March 31, 2023, our variable rate debt obligations of $1.3 billion reflect, in part, the effect of $144.2 million notional amount of interest rate swaps with maturities in March 2027, that effectively convert fixed rate debt to variable rate debt.

As of March 31, 2023, our fixed rate debt obligations of $11.1 billion reflect, in part, the effect of $537.7 million and C$538.0 million notional amount of interest rate swaps with maturities ranging from October 2023 to April 2031, in each case that effectively convert variable rate debt to fixed rate debt.

2023 Activity

In the first quarter of 2023, we hedged an incremental $200.0 million of variable rate debt to fixed rate debt through the execution in March 2023 of two-year $400.0 million notional swaps on our unsecured term loan due in 2027, replacing a $200.0 million notional swap that matured in January 2023. The swap instruments are designated as cash flow hedges.

2217

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

In March 2023, in connection with our new C$271.8 million mortgage debt, we entered into an interest rate swap totaling a notional amount of C$271.8 million with a maturity of March 14, 2028 that effectively converts CDOR-based floating rate debt to fixed rate debt.

In March and April 2023, we entered into a total of $250.0 million aggregate forward starting swaps with a ten-year weighted average rate of 3.37%:

•In March 2023, we entered into a total of $200.0 million of notional forward starting swaps that reduced our exposure to fluctuations in interest rates related to changes in rates between the trade dates of the swaps and the forecasted issuance of long-term debt. The rate on the notional amounts was locked at a ten-year weighted average rate of 3.41%. The forward-starting interest rate swap instruments are designated as cash flow hedges.

•In April 2023, we entered into a total of $50.0 million of notional forward starting swaps that reduced our exposure to fluctuations in interest rates related to changes in rates between the trade dates of the swap and the forecasted issuance of long-term debt. The rate on the notional amounts was locked at a ten-year weighted average rate of 3.17%. The forward-starting interest rate swap instruments are designated as cash flow hedges.

On May 1, 2023, in connection with taking ownership of the Santerre Portfolio, which is collateral for the Santerre Senior Loan, we also took ownership of existing interest rate caps based on LIBOR with an aggregate notional amount of $1.5 billion that expire in June 2023. The objective of the interest rate caps is to offset the variability of cash flows in the Santerre Senior Loan interest payments attributable to fluctuations in LIBOR beyond 3.36%. In order to extend the maturity of the Santerre Senior Loan, which we intend to do, we will be required to obtain an interest rate cap in the notional amount of the Santerre Senior Loan covering the extended period, based on market terms and conditions. We currently expect the interest rate cap required in connection with the extension of the Santerre Senior Loan to be available for a minimal cost and to be “out of the money.” As a result, based on current market conditions, we expect to pay the actual interest due under the Santerre Senior Loan without the benefit of payments from the new interest rate cap.

NOTE ~~11—~~10—FAIR VALUES OF FINANCIAL INSTRUMENTS

The carrying amounts and fair values of our financial instruments were as follows (dollars in thousands):


		As of March 31, 2022				As of December 31, 2021					As of March 31, 2023				As of December 31, 2022
		Carrying Amount		Fair Value		Carrying Amount		Fair Value			Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets:	Assets:									Assets:
Cash and cash equivalents(1)	Cash and cash equivalents(1)	$	149,599	$	149,599	$	149,725	$	149,725	Cash and cash equivalents(1)	$	145,357	$	145,357	$	122,564	$	122,564
Escrow deposits and restricted cash(1)	Escrow deposits and restricted cash(1)	49,848		49,848		46,872		46,872		Escrow deposits and restricted cash(1)	49,924		49,924		48,181		48,181
Stock warrants(5)	Stock warrants(5)	77,452		77,452		48,884		48,884		Stock warrants(5)	24,592		24,592		23,621		23,621
Secured mortgage loans and other, net(4)	Secured mortgage loans and other, net(4)	488,827		483,491		488,913		478,931		Secured mortgage loans and other, net(4)	501,004		501,073		493,669		493,627
Non-mortgage loans receivable, net ~~(1)~~(5)	Non-mortgage loans receivable, net ~~(1)~~(5)	24,116		23,826		19,024		19,039		Non-mortgage loans receivable, net ~~(1)~~(5)	24,418		23,585		24,338		23,416

Government-sponsored pooled loan investments, net(3)	Government-sponsored pooled loan investments, net(3)	41,561		41,561		41,213		41,213		Government-sponsored pooled loan investments, net(3)	—		—		43,406		43,406
Derivative instruments ~~(1)~~(5)	Derivative instruments ~~(1)~~(5)	10,410		10,410		1,128		1,128		Derivative instruments ~~(1)~~(5)	17,998		17,998		24,316		24,316
Liabilities:	Liabilities:									Liabilities:
Senior notes payable and other debt, gross(4)	Senior notes payable and other debt, gross(4)	12,477,876		12,518,899		12,093,138		12,891,937		Senior notes payable and other debt, gross(4)	12,406,943		11,694,570		12,361,244		11,493,824
Derivative instruments ~~(2)~~(6)	Derivative instruments ~~(2)~~(6)	2,571		2,571		12,290		12,290		Derivative instruments ~~(2)~~(6)	2,623		2,623		145		145
Redeemable OP Units(2)	Redeemable OP Units(2)	217,225		217,225		182,112		182,112		Redeemable OP Units(2)	157,432		157,432		162,663		162,663

______________________________

(1)The carrying amount approximates fair value due to the short maturity of these instruments.

(2)Level 1: Fair value calculated based on unadjusted quoted prices for identical assets or liabilities in active markets that we have the ability to access.

(3)Level 2: Fair value calculated using inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets and other inputs for the asset or liability that are observable at commonly quoted intervals, such as interest rates, foreign exchange rates and yield curves.

(4)Level 3: Fair value calculated using unobservable inputs for the asset or liability, which typically are based on our own assumptions, because there is little, if any, related market activity.

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(5)Included in other assets on our Consolidated Balance Sheets.

~~(2)~~(6)Included in accounts payable and other liabilities on our Consolidated Balance Sheets.

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

NOTE ~~12—~~11—COMMITMENTS AND CONTINGENCIES

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

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

NOTE ~~13—~~12—INCOME TAXES

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

Although the TRS entities and certain other foreign entities have paid minimal federal, state and foreign income taxes for the three months ended March 31, ~~2022,~~2023, their income tax liabilities may increase in future periods as we exhaust net operating loss (“NOL”) carryforwards and as our senior living and other operations grow. Such increases could be significant.

Our consolidated provision for income taxes for the three months ended March 31, 2023 and 2022 was a benefit of $2.8 million and ~~2021 was~~ a benefit of $4.5 million, ~~and an expense~~respectively. The income tax benefit for the three months ended March 31, 2023 was primarily due to losses in certain of ~~$2.2 million, respectively.~~our TRS entities. The income tax benefit for the three months ended March 31, 2022 was primarily due to losses in certain of our TRS entities and a $2.0 million benefit from an internal restructuring of a U.S. taxable REIT subsidiary. ~~The income tax expense for the three months ended March 31, 2021 was primarily due to a $2.8 million net deferred tax expense related to an internal restructuring of certain U.S. TRS entities.~~

Each TRS is a tax paying component for purposes of classifying deferred tax assets and liabilities. Deferred tax liabilities with respect to our TRS entities totaled ~~$52.8~~$31.9 million and ~~$59.3~~$35.6 million as of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively, and related primarily to differences between the financial reporting and tax bases of fixed and intangible assets, net of loss carryforwards. Deferred tax assets with respect to our TRS entities totaled ~~$11.2~~$10.9 million and $10.5 million as of ~~both~~ March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively, and related primarily to loss carryforwards.

Generally, we are subject to audit under the statute of limitations by the Internal Revenue Service for the year ended December 31, ~~2018~~2019 and subsequent years and are subject to audit by state taxing authorities for the year ended December 31, ~~2017~~2018 and subsequent years. We are subject to audit generally under the statutes of limitation by the Canada Revenue Agency and provincial authorities with respect to the Canadian entities for the year ended December 31, ~~2017~~2018 and subsequent years. We are subject to audit in the United Kingdom generally for periods ended in and subsequent to ~~2020.~~2021.

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE ~~14—~~13—STOCKHOLDERS' EQUITY

Capital Stock

We participate in an “at-the-market” equity offering program (“ATM program”), pursuant to which we may, from time to time, sell up to $1.0 billion aggregate gross sales price of shares of our common stock. There were no issuances under the ATM program for the three months ended March 31, ~~2022.~~2023. As of March 31, ~~2022,~~2023, $1.0 billion aggregate gross sales price of shares of our common stock remains available for issuance under the ATM program.

Accumulated Other Comprehensive Loss

The following is a summary of our accumulated other comprehensive loss (dollars in thousands):


		As of March 31, 2022		As of December 31, 2021			As of March 31, 2023		As of December 31, 2022
Foreign currency translation loss	Foreign currency translation loss	$	(66,784)	$	(56,227)	Foreign currency translation loss	$	(56,730)	$	(60,364)
Unrealized gain on available for sale securities		1,249		1,836
Unrealized gain (loss) on derivative instruments		6,239		(10,129)

Unrealized gain on derivative instruments						Unrealized gain on derivative instruments	16,261		23,564
Total accumulated other comprehensive loss	Total accumulated other comprehensive loss	$	(59,296)	$	(64,520)	Total accumulated other comprehensive loss	$	(40,469)	$	(36,800)

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

NOTE ~~15—~~14—EARNINGS PER SHARE

The following table shows the amounts used in computing our basic and diluted earnings per share (in thousands, except per share amounts):

For the Three Months Ended March 31,
2022 2021
Numerator for basic and diluted earnings per share:
Income (loss) from continuing operations $ 40,592 $ (55,398)
Net income (loss) 40,592 (55,398)
Net income attributable to noncontrolling interests 1,860 1,811
Net income (loss) attributable to common stockholders $ 38,732 $ (57,209)
Denominator:
Denominator for basic earnings per share—weighted average shares 399,297 374,669
Effect of dilutive securities:
Stock options 25 16
Restricted stock awards 421 282
OP unitholder interests 3,517 2,955
Denominator for diluted earnings per share—adjusted weighted average shares 403,260 377,922
Basic earnings per share:
Income (loss) from continuing operations $ 0.10 $ (0.15)
Net income (loss) attributable to common stockholders 0.10 (0.15)
Diluted earnings per share: (1)

Income (loss) from continuing operations $ 0.10 $ (0.15)
Net income (loss) attributable to common stockholders 0.10 (0.15)


	For the Three Months Ended March 31,
	2023		2022
Numerator for basic and diluted earnings per share:
Income from continuing operations	$	18,912	$	40,592
Net income	18,912		40,592
Net income attributable to noncontrolling interests	1,395		1,860
Net income attributable to common stockholders	$	17,517	$	38,732
Denominator:
Denominator for basic earnings per share—weighted average shares	399,989		399,297
Effect of dilutive securities:
Stock options	—		25
Restricted stock awards	320		421
OP unitholder interests	3,483		3,517
Denominator for diluted earnings per share—adjusted weighted average shares	403,792		403,260
Basic earnings per share:
Income from continuing operations	$	0.05	$	0.10
Net income attributable to common stockholders	0.04		0.10
Diluted earnings per share: (1)
Income from continuing operations	$	0.05	$	0.10
Net income attributable to common stockholders	0.04		0.10

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

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE ~~16—~~15—SEGMENT INFORMATION

As of March 31, ~~2022,~~2023, we operated through 3three reportable business segments: triple-net leased properties, ~~senior living operations~~SHOP and office operations. In our triple-net leased properties reportable business segment, we invest in and own senior housing and healthcare properties throughout the United States and the United Kingdom and lease those properties to healthcare operating companies under ~~“triple-net”~~triple-net or ~~“absolute-net”~~absolute-net leases that obligate the tenants to pay all property-related expenses. In our ~~senior living operations~~SHOP reportable business segment, we invest in senior housing communities throughout the United States and Canada and engage independent operators, such as Atria and Sunrise, to manage those communities. In our office operations reportable business segment, we primarily acquire, own, develop, lease and manage MOBs and life science, research and innovation centers throughout the United States. Information provided for “non-segment” includes management fees and promote revenues, net of expenses related to our third-party institutional capital management business, income from loans and investments ~~and other miscellaneous income~~ and various corporate-level expenses not directly attributable to any of our 3three reportable business segments. Assets included in “non-segment” consist primarily of corporate assets, including cash, restricted cash, loans receivable and investments, and miscellaneous accounts receivable.

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

~~VENTAS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

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

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

~~Summary information by reportable business segment is as follows (dollars in thousands):~~
For the Three Months Ended March 31, 2022
Triple-Net
Leased
Properties Senior
Living
Operations Office
Operations Non-Segment Total
Revenues:
Rental income $ 151,561 $ — $ 200,540 $ — $ 352,101
Resident fees and services — 651,121 — — 651,121
Office building and other services revenue — — 617 3,332 3,949
Income from loans and investments — — — 9,847 9,847
Interest and other income — — — 536 536
Total revenues $ 151,561 $ 651,121 $ 201,157 $ 13,715 $ 1,017,554
Total revenues $ 151,561 $ 651,121 $ 201,157 $ 13,715 $ 1,017,554
Less:
Interest and other income — — — 536 536
Property-level operating expenses 4,008 475,530 63,183 — 542,721
Office building and other services costs — — — 1,313 1,313
Segment NOI $ 147,553 $ 175,591 $ 137,974 $ 11,866 472,984
Interest and other income 536
Interest expense (110,794)
Depreciation and amortization (289,064)
General, administrative and professional fees (42,998)
Transaction expenses and deal costs (19,992)
Allowance on loans receivable and investments 54
Other 27,190
Loss from unconsolidated entities (4,269)
Gain on real estate dispositions 2,455
Income tax benefit 4,490
Income from continuing operations 40,592
Net income 40,592
Net income attributable to noncontrolling interests 1,860
Net income attributable to common stockholders $ 38,732

2621

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

For the Three Months Ended March 31, 2021
Triple-Net Leased Properties Senior Living Operations Office Operations Non-Segment Total
Revenues:
Rental income $ 159,885 $ — $ 197,455 $ — $ 357,340
Resident fees and services — 528,650 — — 528,650
Office building and other services revenue — — 2,345 2,605 4,950
Income from loans and investments — — — 19,010 19,010
Interest and other income — — — 341 341
Total revenues $ 159,885 $ 528,650 $ 199,800 $ 21,956 $ 910,291
Total revenues $ 159,885 $ 528,650 $ 199,800 $ 21,956 $ 910,291
Less:
Interest and other income — — — 341 341
Property-level operating expenses 4,825 417,829 63,946 — 486,600
Office building and other services costs — — 618 — 618
Segment NOI $ 155,060 $ 110,821 $ 135,236 $ 21,615 422,732
Interest and other income 341
Interest expense (110,767)
Depreciation and amortization (314,148)
General, administrative and professional fees (40,309)
Loss on extinguishment of debt, net (27,090)
Transaction expenses and deal costs (4,617)
Allowance on loans receivable and investments 8,902
Other 9,428
Loss from unconsolidated entities (250)
Gain on real estate dispositions 2,533
Income tax expense (2,153)
Loss from continuing operations (55,398)
Net loss (55,398)
Net income attributable to noncontrolling interests 1,811
Net loss attributable to common stockholders $ (57,209)
Summary information by reportable business segment is as follows (dollars in thousands):


	For the Three Months Ended March 31, 2023
	SHOP		Office Operations		Triple-Net Leased Properties		Non-Segment		Total
Revenues:
Rental income	$	—	$	203,004	$	149,739	$	—	$	352,743
Resident fees and services	704,993		—		—		—		704,993
Third party capital management revenues	—		628		—		3,549		4,177
Income from loans and investments	—		—		—		13,589		13,589
Interest and other income	—		—		—		1,743		1,743
Total revenues	$	704,993	$	203,632	$	149,739	$	18,881	$	1,077,245

Total revenues	$	704,993	$	203,632	$	149,739	$	18,881	$	1,077,245
Less:
Interest and other income	—		—		—		1,743		1,743
Property-level operating expenses	537,222		66,913		3,796		—		607,931
Third party capital management expenses	—		—		—		1,706		1,706
NOI	$	167,771	$	136,719	$	145,943	$	15,432	465,865
Interest and other income									1,743
Interest expense									(128,075)
Depreciation and amortization									(282,119)
General, administrative and professional fees									(44,798)

Transaction expenses and deal costs									(1,386)
Allowance on loans receivable and investments									8,064
Other									(7,762)
Loss from unconsolidated entities									(5,623)
Gain on real estate dispositions									10,201
Income tax benefit									2,802
Income from continuing operations									18,912
Net income									18,912
Net income attributable to noncontrolling interests									1,395
Net income attributable to common stockholders									$	17,517

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


	For the Three Months Ended March 31, 2022
	SHOP		Office Operations		Triple-Net Leased Properties		Non-Segment		Total
Revenues:
Rental income	$	—	$	200,540	$	151,561	$	—	$	352,101
Resident fees and services	651,121		—		—		—		651,121
Third party capital management revenues	—		617		—		3,332		3,949
Income from loans and investments	—		—		—		9,847		9,847
Interest and other income	—		—		—		536		536
Total revenues	$	651,121	$	201,157	$	151,561	$	13,715	$	1,017,554

Total revenues	$	651,121	$	201,157	$	151,561	$	13,715	$	1,017,554
Less:
Interest and other income	—		—		—		536		536
Property-level operating expenses	475,530		63,183		4,008		—		542,721
Third party capital management expenses	—		—		—		1,313		1,313
NOI	$	175,591	$	137,974	$	147,553	$	11,866	472,984
Interest and other income									536
Interest expense									(110,794)
Depreciation and amortization									(289,064)
General, administrative and professional fees									(42,998)

Transaction expenses and deal costs									(19,992)
Allowance on loans receivable and investments									54
Other									27,190
Loss from unconsolidated entities									(4,269)
Gain on real estate dispositions									2,455
Income tax benefit									4,490
Income from continuing operations									40,592
Net income									40,592
Net income attributable to noncontrolling interests									1,860
Net income attributable to common stockholders									$	38,732

Capital expenditures, including investments in real estate property and development project expenditures, by reportable business segment are as follows (dollars in thousands):

For the Three Months Ended March 31,
Capital Expenditures: 2022 2021
Triple-Net Leased Properties $ 634 $ 8,218
Senior Living Operations 143,403 48,717
Office Operations 274,074 31,547
Total capital expenditures $ 418,111 $ 88,482


	For the Three Months Ended March 31,
	2023		2022
Capital Expenditures:
SHOP	$	68,132	$	143,403
Office operations	40,804		274,074
Triple-net leased properties	3,720		634
Total capital expenditures	$	112,656	$	418,111

2723

VENTAS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Our portfolio of properties and mortgage loan and other investments are located in the United States, Canada and the United Kingdom. Revenues are attributed to an individual country based on the location of each property. Geographic information regarding our operations is as follows (dollars in thousands):


								For the Three Months Ended March 31,
		For the Three Months Ended March 31,				2023		2022
Revenues:	Revenues:	2022		2021			Revenues:
United States	United States	$	897,933	$	797,768		United States	$	958,126	$	897,933
Canada	Canada	112,144		105,033			Canada	112,122		112,144
United Kingdom	United Kingdom	7,477		7,490			United Kingdom	6,997		7,477
Total revenues	Total revenues	$	1,017,554	$	910,291		Total revenues	$	1,077,245	$	1,017,554


							As of March 31, 2023		As of December 31, 2022
Net Real Estate Property:	Net Real Estate Property:	As of March 31, 2022		As of December 31, 2021		Net Real Estate Property:
United States	United States	$	18,718,109	$	18,562,738	United States	$	18,002,715	$	18,168,224
Canada	Canada	3,027,276		3,007,008		Canada	2,785,433		2,782,350
United Kingdom	United Kingdom	236,836		247,092		United Kingdom	211,161		209,876
Total net real estate property	Total net real estate property	$	21,982,221	$	21,816,838	Total net real estate property	$	20,999,309	$	21,160,450

2824

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

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

Cautionary Statements

Forward-Looking Statements

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

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

Certain factors that could affect our future results and our ability to achieve our stated goals include, but are not limited to: (a) the impact of the ongoing COVID-19 pandemic and ~~its~~other viruses and infections, such as flu and respiratory syncytial virus, and their extended consequences, including of ~~the Delta, Omicron or~~ any ~~other variant,~~variants, on our revenue, level of profitability, liquidity and overall risk exposure and the implementation and impact of regulations related to the CARES Act and other stimulus legislation and any future COVID-19 relief measures; (b) our ability to achieve the anticipated benefits and synergies from, and effectively integrate, our completed or anticipated acquisitions and investments, including our acquisition of ~~New Senior Investment Group Inc. (“New Senior”);~~the Santerre Portfolio; (c) our exposure and the exposure of our tenants, managers and borrowers to complex healthcare and other regulation and the challenges and expense associated with complying with such regulation; (d) the potential for significant general and commercial claims, legal actions, regulatory proceedings or enforcement actions that could subject us or our tenants, managers or borrowers to increased operating costs and uninsured liabilities; (e) the impact of market and general economic conditions on us and our tenants, managers and borrowers, including economic and financial market events, such as bank failures and other events affecting financial institutions, market volatility, increases in inflation, changes in interest rates and exchange rates, tightening of lending standards and reduced availability of credit or capital, supply chain pressures, rising labor costs and historically low unemployment, events that affect consumer confidence, our occupancy rates and resident fee revenues, and the actual and perceived state of the real estate markets, labor markets and public and private capital markets; (f) our reliance and the reliance of our tenants, managers and borrowers on the financial, credit and capital markets and the risk that those markets may be disrupted or become constrained, including as a result of bank failures or concerns or rumors about such events, tightening of lending standards and reduced availability of credit or capital; (g) our ability, and the ability of our tenants, managers and borrowers, to navigate the trends impacting our or their businesses and the industries in which we or they operate; ~~(g)~~(h) the risk of bankruptcy, inability to obtain benefits from governmental programs, insolvency or financial deterioration of our tenants, managers, borrowers and other obligors which may, among other things, have an adverse impact on the ability of such parties to pay obligations due to us or our financial results and ~~our ability~~financial condition; (i) the risk that we may be unable to foreclose successfully on the collateral securing our loans and other investments in the event of a borrower ~~default; (h)~~default and, if we are able to foreclose or otherwise acquire assets in lieu of foreclosure, the risk that we will be required to incur additional expense or indebtedness in connection therewith, that the assets will underperform expectations or that we may not be able to subsequently dispose of all or part of such assets on favorable terms; (j) the recognition of reserves, allowances, credit losses or impairment charges are inherently uncertain, may increase or decrease in the future and may not represent or reflect the ultimate value of, or loss that we ultimately realize with respect to, the relevant assets, which could have an adverse impact on our results of operations and financial condition; (k) the non-renewal of any leases or management agreement or defaults by tenants or managers thereunder and the risk of our inability to replace those tenants or managers on favorable terms, if at all; (l) our ability to identify and consummate future investments in or dispositions of healthcare assets and effectively

manage our portfolio opportunities and our investments in co-investment vehicles, joint ventures and minority ~~interests; (i)~~interests, including our ability to dispose of such assets on favorable terms as a result of rights of first offer or rights of first refusal in favor of third parties; (m) risks related to development, redevelopment and construction ~~projects; (j)~~projects, including costs associated with inflation, rising interest rates, labor conditions and supply chain pressures; (n) our ability to attract and retain talented employees; ~~(k)~~(o) the limitations and significant requirements imposed upon our business as a result of our status as a REIT and the adverse consequences (including the possible loss of our status as a REIT) that would result if we are not able to ~~comply; (l)~~comply with such requirements; (p) the risk of changes in healthcare law or regulation or in tax laws, guidance and interpretations, particularly as applied to REITs, that could adversely affect us or our tenants, managers or borrowers; ~~(m)~~(q) increases in our borrowing costs as a result of becoming more leveraged, including in connection with acquisitions or ~~as a result of changes in~~other investment activity, rising interest rates and the phasing out of LIBOR rates; ~~(n)~~(r) our reliance on third parties to operate a majority of our assets and our limited control and influence over such operations and results; ~~(o)~~(s) our dependency on a limited number of tenants and managers for a significant portion of our revenues and operating income; ~~(p)~~(t) the adequacy and pricing of insurance coverage provided by our policies and policies maintained by our tenants, managers or other counterparties; ~~(q)~~(u) the occurrence of cyber incidents that could disrupt our operations, result in the loss of confidential information or damage our business relationships and reputation; ~~(r)~~(v) the impact of merger, acquisition and investment activity in the healthcare industry or otherwise affecting our tenants, managers or borrowers; ~~(s)~~(w) disruptions to the management and operations of our business and the uncertainties caused by activist investors; ~~and (t)~~(x) the risk of catastrophic or extreme weather and other natural events and the physical effects of climate ~~change.~~change; (y) the impact of purchase accounting adjustments, impairments, write downs and other non-cash charges related to our acquisition of the Santerre Portfolio; and (z) the other factors set forth in our periodic filings with the Securities and Exchange Commission.

Note Regarding Third-Party Information

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

Company Overview

Ventas, Inc., an S&P 500 company, is a real estate investment trust operating at the intersection of healthcare and real estate. We hold a highly diversified portfolio of senior housing communities, medical office buildings (“MOBs”), life science, research and innovation centers, hospitals and other healthcare facilities, which we generally refer to collectively as “healthcare real estate,” located throughout the United States, Canada, and the United Kingdom. As of March 31, ~~2022,~~2023, we owned or had investments in approximately ~~1,300~~1,200 properties (including properties classified as held for sale). Our company was originally founded in 1983 and is headquartered in Chicago, Illinois with additional corporate offices in Louisville, Kentucky and New York, New York.

We primarily invest in a diversified portfolio of healthcare real estate assets through wholly owned subsidiaries and other co-investment entities. We operate through three reportable business segments: triple-net leased properties, senior ~~living operations,~~housing operating portfolio, which we also refer to as ~~SHOP,~~“SHOP” and which was formerly known as senior living operations, and office operations. See our Consolidated Financial Statements and the related notes, including “Note 2 – Accounting Policies” and “Note 1615 – Segment Information,” included in Item 1 of this Quarterly Report on Form 10-Q. Our senior housing communities are either subject to triple-net leases, in which case they are included in our triple-net leased properties reportable business segment, or operated by independent third-party managers, in which case they are included in our ~~senior living operations~~SHOP reportable business segment.

As of March 31, ~~2022,~~2023, we leased a total of ~~332~~312 properties (excluding properties within our office operations reportable business segment) to various healthcare operating companies under triple-net or absolute-net leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures. Our three largest tenants, Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”), Ardent Health Partners, LLC (together with its subsidiaries, “Ardent”) and Kindred Healthcare, LLC (together with its subsidiaries, “Kindred”) leased from us 121 properties, 30 properties (including 19 MOBs) and 29 properties, respectively, as of March 31, ~~2022.~~2023.

As of March 31, 2023, we owned or had investments in 373 properties in our office operations reportable business segment. These properties generally consist of MOBs that are predominantly located on or contiguous to a health system campus and life science, research and innovation properties that are affiliated with and often located on or contiguous to a university or academic medical campus. Through our Lillibridge Healthcare Services, Inc. (“Lillibridge”) subsidiary and our ownership interest in PMB Real Estate Services LLC (“PMBRES”), we also provide MOB management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States.

In addition, from time to time, we make secured and ~~non-mortgage~~unsecured loans and other investments relating to ~~senior housing~~healthcare real estate or operators.

We have a third-party institutional capital management business, Ventas Investment Management (“VIM”), which includes our open-ended investment vehicle, the Ventas Life Science & Healthcare Real Estate Fund (the “Ventas Fund”). Through VIM, we partner with third-party institutional investors to invest in healthcare real estate through various joint ventures and ~~healthcare operators~~other co-investment vehicles where we are the sponsor or ~~properties.~~general partner.

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

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

~~First Quarter 2022~~2023 Highlights

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

~~During fiscal~~Starting in 2020, ~~and 2021 and continuing into fiscal 2022,~~ our business ~~has been and is expected to continue to be~~was significantly impacted by both the COVID-19 pandemic itself, including actions taken to prevent the spread of the virus and its variants, and its extended consequences. The trajectory and future impact of ~~the~~ COVID-19 ~~pandemic~~ remains highly uncertain. The extent of ~~the pandemic’s~~COVID-19’s continuing and ultimate effect on our operational and financial performance will depend on a variety of factors, including the impact of new variants of the virus and the effectiveness of available vaccines against those variants; ongoing clinical experience, which may differ considerably across governmental and regulatory bodies and regions and fluctuate over time; and on other future developments, including the ultimate duration, spread and intensity of the outbreak, the availability of testing, the extent to which governments impose, roll-back or re-impose preventative restrictions and the availability of ongoing government financial support to our business, tenants and operators. Due to these uncertainties, we are not able at this time to estimate the ultimate impact of ~~the~~ COVID-19 ~~pandemic~~ on our business, results of operations, financial condition and cash flows.

Investments and Dispositions

•During the ~~first quarter~~three months ended March 31, 2023, we committed to a MOB ground-up development located on the Sutter Roseville Medical Center campus in Roseville, California. The $61.8 million project includes the development of ~~2022, we acquired 18 MOBs leased~~a new class A MOB and is 100% pre-leased to affiliates of ~~Ardent, one behavioral health center and one senior housing community~~Sutter Health for ~~an aggregate purchase price of $349.2 million. In April, we acquired one research and innovation center in Philadelphia, Pennsylvania for $46.1 million.~~a 15-year lease term.

•During the ~~first quarter of 2022,~~three months ended March 31, 2023, we sold ~~one~~five senior housing communities (three of which were vacant), four MOBs and two vacant ~~land parcel~~triple-net leased properties for ~~$5.6~~aggregate consideration of $46.4 million and recognized a net gain on the sale of ~~$2.2 million.~~these assets of $10.2 million in our Consolidated Statements of Income.

•On May 1, 2023, we took ownership of the collateral that supported our cash-pay mezzanine loan to Santerre Health Investors (the “Santerre Mezzanine Loan”) by converting the outstanding principal amount of the Santerre Mezzanine Loan to equity, with no additional consideration being paid. As a result, the Santerre Mezzanine Loan is no longer

outstanding. The Company received payment of full contractual interest on the Santerre Mezzanine Loan through the April 2023 payment date. The properties consist of a diverse pool of medical office buildings, senior housing operating portfolio communities, triple-net leased skilled nursing facilities and hospital assets in the United States (such assets, collectively, the “Santerre Portfolio”). Our ownership of the Santerre Portfolio is subject to an existing approximately $1 billion non-recourse senior loan (the “Santerre Senior Loan”) secured by the Santerre Portfolio.

Liquidity and Capital

•As of March 31, 2023, we had approximately $2.4 billion in liquidity, including availability under our revolving credit facility and cash and cash equivalents on hand, with $425.0 million borrowings outstanding under our commercial paper program.

•As of March 31, 2023, we have $1.0 billion remaining under our “at-the-market” equity offering program (“ATM program”), under which we may sell up to $1.0 billion aggregate gross sales price of shares of our common stock.

•In March 2023, we entered into a new five year C$271.8 million mortgage debt secured by 14 SHOP communities in Canada at an effective fixed rate of 4.36%.

•In the first quarter of 2023, we hedged an incremental $200.0 million of variable rate debt to fixed rate debt through the execution in March 2023 of two-year $400.0 million notional swaps on our unsecured term loan due in 2027, replacing a $200.0 million notional swap that matured in January 2023.

•In March and April 2023, we entered into a total of $250.0 million aggregate forward starting swaps with a ten-year weighted average rate of 3.37%.

•In April 2023, our 100% owned subsidiary, Ventas Canada Finance Limited (“Ventas Canada”), issued and sold C$600.0 million aggregate principal amount of 5.398% Senior Notes due 2028 in a private placement at par. Pursuant to cash tender offers, we used the proceeds to repurchase C$613.7 million in aggregate principal amount of outstanding senior notes due in 2024 for an aggregate purchase price of C$600.0 million plus accrued and unpaid interest to, but not including, the settlement date.

•Our ownership of the Santerre Portfolio is subject to an existing approximately $1 billion non-recourse Santerre Senior Loan, which is secured by the Santerre Portfolio, bears interest at a current weighted average rate of LIBOR + 1.84% and matures on June 9, 2023. We have given notice to extend the maturity of the Santerre Senior Loan to June 2024, which is subject to the satisfaction of certain conditions, including entering into an interest rate cap for the extension period. The Santerre Senior Loan can be repaid in whole or in part prior to its maturity, without penalty, and assets can be released from the liens, subject to certain conditions.

Other Items

•~~During the first quarter~~As of 2022, we received $34.0 million in grants in connection with our Phase 4 applications to the Provider Relief Fund administered by the U.S. Department of Health & Human Services (“HHS”) on behalf of the assisted living communities in our senior living operations segment to partially mitigate losses attributable to COVID-19.

•~~Subsequent to~~ March 31, ~~2022, Ventas~~2023, we held a 9.8% ownership interest in Ardent, which entitled us to customary minority rights and Sunrise entered into a revised management agreement for 92 communities with a term expiring May 31, 2035. Under the new management agreement, Sunrise will receive a management fee based on a percentage of revenue and net operating income generated by the applicable communities. Sunrise is also entitled to certain incentive fees if specified performance targets are met. Ventas hasprotections, including the right to freely terminate the management agreement as to all communities if certain performance metrics are not met and may freely terminate the management agreement as to certain specified communities at any time. In addition, Ventas may also terminate the management agreement as it relates to three communities per year subjectappoint one member to the ~~payment~~Ardent Board of Directors. In May 2023, we sold approximately 24% of our ownership interest in Ardent to a ~~fee and an aggregate cap on such terminations over the term~~third-party investor for approximately $50 million in total proceeds. As a result of the ~~agreement.~~sale, we expect to recognize approximately $34 million of gain in the second quarter of 2023 in income from unconsolidated entities in our Consolidated Statements of Income and our ownership interest in Ardent will be reduced to approximately 7.5%. Following the transaction, we continue to have the same minority rights and protections, including the right to appoint one member to the Ardent Board of Directors.

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Concentration Risk

We use concentration ratios to identify, understand and evaluate the potential impact of economic downturns and other adverse events that may affect our asset types, geographic locations, business models, and tenants, operators and managers. We evaluate concentration risk in terms of investment mix and operations mix. Investment mix measures the percentage of our investments that is concentrated in a specific asset type or that is operated or managed by a particular tenant, operator or manager. Operations mix measures the percentage of our operating results that is attributed to a particular tenant, operator or manager, geographic location or business model.

The following tables reflect our concentration risk as of the dates and for the periods presented:
As of March 31, 2022 As of December 31, 2021
Investment mix by asset type (1):

Senior housing communities 67.0 % 67.4 %
MOBs 17.7 17.1
Life science, research and innovation centers 6.6 6.7
Health systems 4.9 5.0
Inpatient rehabilitation facilities (“IRFs”) and long-term acute care facilities (“LTACs”) 1.5 1.5
Skilled nursing facilities (“SNFs”) 0.6 0.6
Secured loans receivable and investments, net 1.7 1.7
Total 100.0 % 100.0 %
Investment mix by tenant, operator and manager (1):

Atria (2)
26.7 % 27.0 %
Sunrise 9.9 10.0
Brookdale Senior Living 7.7 7.8
Le Groupe Maurice 7.3 7.3
Ardent 5.3 4.7
Kindred 0.8 1.0
All other 42.3 42.2
Total 100.0 % 100.0 %
The following tables reflect our concentration risk as of the dates and for the periods presented:


	As of March 31, 2023		As of December 31, 2022
Investment mix by asset type (1):
Senior housing communities	66.4	%	66.3	%
MOBs	18.0		18.0
Life science, research and innovation centers	7.0		6.9
Health systems	4.9		4.9
Inpatient rehabilitation facilities (“IRFs”) and long-term acute care facilities (“LTACs”)	1.5		1.5
Skilled nursing facilities (“SNFs”)	0.6		0.6
Secured loans receivable and investments, net	1.6		1.8
Total	100.0	%	100.0	%
Investment mix by tenant, operator and manager (1):
Atria (2)	26.0	%	26.0	%
Sunrise	9.9		9.8
Lillibridge	9.3		9.3
Brookdale Senior Living	7.8		7.8
Le Groupe Maurice	7.1		7.0
Wexford	6.6		6.6
Ardent	5.3		5.3
Kindred	0.8		0.8
All other	27.2		27.4
Total	100.0	%	100.0	%

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

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

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		For the Three Months Ended March 31,				For the Three Months Ended March 31,
		2022		2021				2023		2022
Operations mix by tenant and operator and business model:	Operations mix by tenant and operator and business model:						Operations mix by tenant and operator and business model:
Revenues (1):	Revenues (1):						Revenues (1):
Senior living operations		64.0	%	58.3	%
SHOP							SHOP	65.5	%	64.0	%
Brookdale Senior Living (2)	Brookdale Senior Living (2)	3.7		4.1			Brookdale Senior Living (2)	3.5		3.7
Kindred	Kindred	3.3		3.6			Kindred	3.0		3.3
Ardent	Ardent	3.2		3.5			Ardent	3.1		3.2
All others	All others	25.8		30.5			All others	24.9		25.8
Total	Total	100.0	%	100.0	%		Total	100.0	%	100.0	%
Net operating income (“NOI”):	Net operating income (“NOI”):						Net operating income (“NOI”):
Senior living operations		37.1	%	26.6	%
SHOP							SHOP	36.0	%	37.1	%
Brookdale Senior Living (2)	Brookdale Senior Living (2)	7.8		8.8			Brookdale Senior Living (2)	8.0		7.8
Kindred	Kindred	7.0		7.8			Kindred	7.0		7.0
Ardent	Ardent	6.8		7.5			Ardent	7.1		6.8
All others	All others	41.3		49.3			All others	41.9		41.3
Total	Total	100.0	%	100.0	%		Total	100.0	%	100.0	%
Operations mix by geographic location (3):	Operations mix by geographic location (3):						Operations mix by geographic location (3):
California	California	15.0	%	15.4	%		California	14.3	%	15.0	%
New York	New York	7.4		7.7			New York	7.7		7.4
Texas	Texas	6.6		6.0			Texas	6.5		6.6
Pennsylvania	Pennsylvania	4.8		4.6			Pennsylvania	5.2		4.8
North Carolina	North Carolina	4.4		3.7			North Carolina	4.2		4.4
All others	All others	61.8		62.6			All others	62.1		61.8
Total	Total	100.0	%	100.0	%		Total	100.0	%	100.0	%

(1)Total revenues include ~~office building and other services revenue,~~third party capital management revenues, revenue from loans and investments and interest and other income (including amounts related to assets classified as held for sale).

(2)Results exclude ~~eight~~nine senior housing communities which are included in the ~~senior living operations~~SHOP reportable business segment.

(3)Ratios are based on total revenues (including amounts related to assets classified as held for sale) for each period presented.

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

Triple-Net Lease Performance and Expirations

Any failure, inability or unwillingness by our tenants to satisfy their obligations under our triple-net leases could have a material adverse effect on us. Also, if our tenants are not able or willing to renew our triple-net leases upon expiration, we may be unable to reposition the applicable properties on a timely basis or on the same or better economic terms, if at all. Although our lease expirations are staggered, the non-renewal of some or all of our triple-net leases that expire in any given year could have a material adverse effect on us. During the three months ended March 31, ~~2022,~~2023, we had no triple-net lease renewals or expirations without renewal that, in the aggregate, had a material impact on our financial condition or results of operations for that period.

Critical Accounting Policies and Estimates

Our Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”), and with the SEC instructions to Form 10-Q and Article 10 of Regulation S-X. GAAP requires us to make estimates and assumptions regarding future events that affect the reported amounts of assets and liabilities, the disclosure of contingent assets

and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We base these estimates on our experience and assumptions we believe to be reasonable under the circumstances. However, if our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, we may have applied a different accounting treatment, resulting in a different presentation of our financial statements. We periodically reevaluate our estimates and assumptions, and in the event they prove to be different from actual results, we make adjustments in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain.

Our ~~2021~~2022 Annual Report contains additional information regarding the critical accounting policies that affect our more significant estimates and judgments used in the preparation of our Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. There have been no material changes to these policies in 2022. Please refer to “Note 2 – Accounting Policies” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for information regarding recently adopted accounting standards.2023.

Results of Operations

As of March 31, ~~2022,~~2023, we operated through three reportable business segments: triple-net leased properties, ~~senior living operations~~SHOP and office operations. In our triple-net leased properties reportable business segment, we invest in and own senior housing and healthcare properties throughout the United States and the United Kingdom and lease those properties to healthcare operating companies under ~~“triple-net”~~triple-net or ~~“absolute-net”~~absolute-net leases that obligate the tenants to pay all property-related expenses. In our ~~senior living operations~~SHOP reportable business segment, we invest in senior housing communities throughout the United States and Canada and engage independent operators, such as Atria and Sunrise, to manage those communities. In our office operations reportable business segment, we primarily acquire, own, develop, lease and manage MOBs and life science, research and innovation centers throughout the United States. Information provided for “non-segment” includes income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to any of our three reportable business segments. Assets included in “non-segment” consist primarily of corporate assets, including cash, restricted cash, loans receivable and investments, and miscellaneous accounts receivable.

Our chief operating decision ~~makers evaluate~~maker evaluates performance of the combined properties in each reportable business segment and ~~determine~~determines how to allocate resources to those segments, in significant part, based on ~~segment~~ net operating income (“NOI”) and related ~~measures.~~measures for each segment. For further information regarding our reportable business segments and a discussion of our definition of ~~segment~~ NOI, see “Note 1615 – Segment Information” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. See “Non-GAAP Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure and reconciliations of net income attributable to common stockholders, as computed in accordance with GAAP, to NOI.

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Three Months Ended March 31, ~~2022~~2023 and ~~2021~~2022

The table below shows our results of operations for the three months ended March 31, ~~2022~~2023 and ~~2021~~2022 and the effect of changes in those results from period to period on our net income attributable to common stockholders (dollars in thousands):


		For the Three Months Ended March 31,				(Decrease) Increase to Net Income					For the Three Months Ended March 31,				(Decrease) Increase to Net Income
		2022		2021		$		%			2023		2022		$		%
Segment NOI:
NOI:										NOI:
SHOP										SHOP	$	167,771	$	175,591	$	(7,820)	(4.5)	%
Office operations										Office operations	136,719		137,974		(1,255)		(0.9)
Triple-net leased properties	Triple-net leased properties	$	147,553	$	155,060	$	(7,507)	(4.8)	%	Triple-net leased properties	145,943		147,553		(1,610)		(1.1)
Senior living operations		175,591		110,821		64,770		58.4
Office operations		137,974		135,236		2,738		2.0
Non-segment	Non-segment	11,866		21,615		(9,749)		(45.1)		Non-segment	15,432		11,866		3,566		30.1
Total segment NOI		472,984		422,732		50,252		11.9
Total NOI										Total NOI	465,865		472,984		(7,119)		(1.5)
Interest and other income	Interest and other income	536		341		195		57.2		Interest and other income	1,743		536		1,207		nm
Interest expense	Interest expense	(110,794)		(110,767)		(27)		—		Interest expense	(128,075)		(110,794)		(17,281)		(15.6)
Depreciation and amortization	Depreciation and amortization	(289,064)		(314,148)		25,084		8.0		Depreciation and amortization	(282,119)		(289,064)		6,945		2.4
General, administrative and professional fees	General, administrative and professional fees	(42,998)		(40,309)		(2,689)		(6.7)		General, administrative and professional fees	(44,798)		(42,998)		(1,800)		(4.2)
Loss on extinguishment of debt, net		—		(27,090)		27,090		100.0

Transaction expenses and deal costs	Transaction expenses and deal costs	(19,992)		(4,617)		(15,375)		nm		Transaction expenses and deal costs	(1,386)		(19,992)		18,606		93.1
Allowance on loans receivable and investments	Allowance on loans receivable and investments	54		8,902		(8,848)		(99.4)		Allowance on loans receivable and investments	8,064		54		8,010		nm
Other	Other	27,190		9,428		17,762		nm		Other	(7,762)		27,190		(34,952)		(128.5)
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests		37,916		(55,528)		93,444		nm
Income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests										Income before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests	11,532		37,916		(26,384)		(69.6)
Loss from unconsolidated entities	Loss from unconsolidated entities	(4,269)		(250)		(4,019)		nm		Loss from unconsolidated entities	(5,623)		(4,269)		(1,354)		(31.7)
Gain on real estate dispositions	Gain on real estate dispositions	2,455		2,533		(78)		(3.1)		Gain on real estate dispositions	10,201		2,455		7,746		nm
Income tax benefit (expense)		4,490		(2,153)		6,643		nm
Income (loss) from continuing operations		40,592		(55,398)		95,990		nm
Net income (loss)		40,592		(55,398)		95,990		nm
Income tax benefit										Income tax benefit	2,802		4,490		(1,688)		(37.6)
Income from continuing operations										Income from continuing operations	18,912		40,592		(21,680)		(53.4)
Net income										Net income	18,912		40,592		(21,680)		(53.4)
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests	1,860		1,811		(49)		(2.7)		Net income attributable to noncontrolling interests	1,395		1,860		465		25.0
Net income (loss) attributable to common stockholders		$	38,732	$	(57,209)	$	95,941	nm
Net income attributable to common stockholders										Net income attributable to common stockholders	$	17,517	$	38,732	$	(21,215)	(54.8)

nm - not meaningful

~~Segment~~ NOI—SHOP

The following table summarizes results of operations in our SHOP reportable business segment, including assets sold or classified as held for sale as of March 31, 2023 (dollars in thousands):


	For the Three Months Ended March 31,				Increase (Decrease) to NOI
	2023		2022		$		%
NOI—SHOP:
Resident fees and services	$	704,993	$	651,121	$	53,872	8.3	%
Less: Property-level operating expenses	(537,222)		(475,530)		(61,692)		(13.0)
NOI	$	167,771	$	175,591	$	(7,820)	(4.5)


	Number of Properties at March 31,		Average Unit Occupancy for the Three Months Ended March 31,				Average Monthly Revenue Per Occupied Room for the Three Months Ended March 31,
	2023	2022	2023		2022		2023		2022
Total communities	551	546	80.6	%	80.0	%	$	4,624	$	4,370

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

The NOI decrease in our SHOP reportable business segment for the three months ended March 31, 2023 compared to the same period in 2022 was driven by $34.0 million of HHS grants received in 2022, which are reflected as a reduction in property-level operating expenses, offset by higher revenues in 2023 driven by higher occupancy and revenue per occupied room. No HHS grants were received in 2023.

The following table compares results of operations for our 507 same-store SHOP communities (dollars in thousands). See “Non-GAAP Financial Measures—NOI” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure regarding same-store NOI for each of our reportable business segments.


	For the Three Months Ended March 31,				Increase (Decrease) to NOI
	2023		2022		$		%
Same-Store NOI—SHOP:
Resident fees and services	$	652,941	$	605,469	$	47,472	7.8	%
Less: Property-level operating expenses	(494,380)		(440,725)		(53,655)		(12.2)
NOI	$	158,561	$	164,744	$	(6,183)	(3.8)


	Number of Properties at March 31,		Average Unit Occupancy for the Three Months Ended March 31,				Average Monthly Revenue Per Occupied Room for the Three Months Ended March 31,
	2023	2022	2023		2022		2023		2022
Same-store communities	507	507	81.3	%	80.5	%	$	4,646	$	4,352

The NOI decrease in our same-store SHOP reportable business segment for the three months ended March 31, 2023 compared to the same period in 2022 was primarily driven by $30.7 million of HHS grants received in 2022, offset by higher revenues in 2023 driven by higher occupancy and revenue per occupied room. No HHS grants were received in 2023.

NOI—Office Operations

The following table summarizes results of operations in our office operations reportable business segment, including assets sold or classified as held for sale as of March 31, 2023 (dollars in thousands). For properties in our office operations reportable business segment, occupancy generally reflects occupied square footage divided by net rentable square footage as of the end of the reporting period.


	For the Three Months Ended March 31,				Increase (Decrease) to NOI
	2023		2022		$		%
NOI—Office Operations:
Rental income	$	203,004	$	200,540	$	2,464	1.2	%
Third party capital management revenues	628		617		11		1.8
Total revenues	203,632		201,157		2,475		1.2
Less:
Property-level operating expenses	(66,913)		(63,183)		(3,730)		(5.9)

NOI	$	136,719	$	137,974	$	(1,255)	(0.9)


	Number of Properties at March 31,		Occupancy at March 31,				Annualized Average Rent Per Occupied Square Foot for the Three Months Ended March 31,
	2023	2022	2023		2022		2023		2022
Total office buildings	355	361	89.6	%	90.5	%	$	37	$	36

The NOI decrease in office operations reportable business segment for the three months ended March 31, 2023 compared to the same period in 2022 was primarily due to dispositions of non-core assets, partially offset by leasing activity, high tenant retention, improved parking revenues and acquisitions subsequent to March 31, 2022.

The following table compares results of operations for our 327 same-store office buildings (dollars in thousands):


	For the Three Months Ended March 31,				Increase (Decrease) to NOI
	2023		2022		$		%
Same-Store NOI—Office Operations:
Rental income	$	191,770	$	187,593	$	4,177	2.2	%
Less: Property-level operating expenses	(62,690)		(59,513)		(3,177)		(5.3)
NOI	$	129,080	$	128,080	$	1,000	0.8


	Number of Properties at March 31,		Occupancy at March 31,				Annualized Average Rent Per Occupied Square Foot for the Three Months Ended March 31,
	2023	2022	2023		2022		2023		2022
Same-store office buildings	327	327	91.5	%	91.2	%	$	37	$	37

The NOI increase in our same-store office operations reportable business segment for the three months ended March 31, 2023 compared to the same period in 2022 was primarily driven by leasing activity, high tenant retention and improved parking revenues.

NOI—Triple-Net Leased Properties

The following table summarizes results of operations in our triple-net leased properties reportable business segment, including assets sold or classified as held for sale as of March 31, ~~2022~~2023 (dollars in thousands):


		For the Three Months Ended March 31,				(Decrease) Increase to Segment NOI					For the Three Months Ended March 31,				(Decrease) Increase to NOI
		2022		2021		$		%			2023		2022		$		%
Segment NOI—Triple-Net Leased Properties:
NOI—Triple-Net Leased Properties:										NOI—Triple-Net Leased Properties:
Rental income	Rental income	$	151,561	$	159,885	$	(8,324)	(5.2)	%	Rental income	$	149,739	$	151,561	$	(1,822)	(1.2)	%
Less: Property-level operating expenses	Less: Property-level operating expenses	(4,008)		(4,825)		817		16.9		Less: Property-level operating expenses	(3,796)		(4,008)		212		5.3
Segment NOI		$	147,553	$	155,060	$	(7,507)	(4.8)
NOI										NOI	$	145,943	$	147,553	$	(1,610)	(1.1)

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

The ~~segment~~ NOI decrease in our triple-net leased ~~portfolio~~properties for the three months ended March 31, 2023 compared to the same period in 2022 was primarily driven by rental income from communities that were transitioned to our senior housing operating portfolio or sold ~~prior to the first quarter of 2022, partially~~and lease resolutions with several smaller senior housing triple-net tenants who were materially affected by COVID-19, offset by ~~an increase in~~additional rental income ~~for one property acquired after the first quarter of 2021.~~received and contractual rent escalators.

Occupancy rates may affect the profitability of our tenants’ operations. For senior housing communities and post-acute properties in our triple-net leased properties reportable business segment, occupancy generally reflects average operator-reported unit and bed occupancy, respectively, for the reporting period. Because triple-net financials are delivered to us following the reporting period, occupancy is reported in arrears. The following table sets forth average continuing occupancy rates for the fourth quarter of 2022 and 2021 related to the triple-net leased properties we owned at March 31, ~~2022~~2023 and ~~2021 for the fourth quarter of~~ 2022, ~~and 2021,~~ respectively. The table excludes non-stabilized properties, properties owned through investments in unconsolidated real estate entities, certain properties for which we do not receive occupancy information and properties acquired or properties that transitioned operators for which we do not have a full quarter of occupancy results.

Number of Properties Owned at March 31, 2022 Average Occupancy for the Three Months Ended December 31, 2021 Number of Properties Owned at March 31, 2021 Average Occupancy for the Three Months Ended December 31, 2020
Senior housing communities 261 75.2% 284 79.2%
SNFs 16 79.5 16 79.7
IRFs and LTACs 35 57.0 35 57.2

~~Declines in occupancy are primarily the result of COVID-19 impacts to senior housing and SNF operations.~~

~~The following table compares results of operations for our 331 same-store triple-net leased properties. See “Non-GAAP Financial Measures~~—~~NOI” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure regarding same-store NOI for each of our reportable business segments (dollars in thousands).~~

For the Three Months Ended March 31, (Decrease) Increase
to Segment NOI
2022 2021 $ %
Same-Store Segment NOI—Triple-Net Leased Properties:
Rental income $ 149,371 $ 149,428 $ (57) — %
Less: Property-level operating expenses (3,798) (3,834) 36 0.9
Segment NOI $ 145,573 $ 145,594 $ (21) —

Segment NOI in our same-store triple-net leased portfolio was flat during the first quarter of 2022 as compared to the same period in 2021 driven by contractual escalators offset by reduced payments from select senior housing tenants due to the continued pandemic impact.

~~Segment NOI—Senior Living Operations~~

The following table summarizes results of operations in our senior living operations reportable business segment, including assets sold or classified as held for sale as of March 31, 2022 (dollars in thousands):

For the Three Months Ended March 31, Increase (Decrease)
to Segment NOI
2022 2021 $ %
Segment NOI—Senior Living Operations:
Resident fees and services $ 651,121 $ 528,650 $ 122,471 23.2 %
Less: Property-level operating expenses (475,530) (417,829) (57,701) (13.8)
Segment NOI $ 175,591 $ 110,821 $ 64,770 58.4

Number of Properties at March 31, Average Unit Occupancy for the Three Months Ended March 31, Average Monthly Revenue Per Occupied Room For the Three Months Ended March 31,
2022 2021 2022 2021 2022 2021
Total communities 546 439 80.0 % 76.3 % $ 4,373 $ 4,649

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

The increase in our senior living operations reportable business segment NOI was primarily driven by the acquisition of over 100 independent living communities from New Senior in September 2021, an overall increase in occupancy and higher HHS grants received, which are reflected as a reduction in property-level operating expenses. During the first quarter of 2022 and 2021, HHS grants received reduced property-level operating expenses by $32.8 million, net of management fees of $1.1 million, and $13.6 million, respectively.


	Number of Properties Owned at March 31, 2023	Average Occupancy for the Three Months Ended December 31, 2022	Number of Properties Owned at March 31, 2022	Average Occupancy for the Three Months Ended December 31, 2021
Senior housing communities	244	77.8%	261	75.2%
SNFs	16	84.3	16	79.5
IRFs and LTACs	36	55.7	35	57.0

The following table compares results of operations for our ~~321~~312 same-store ~~senior living operating communities~~triple-net leased properties (dollars in thousands):

For the Three Months Ended March 31, Increase (Decrease)
to Segment NOI
2022 2021 $ %
Same-Store Segment NOI—Senior Living Operations:
Resident fees and services $ 479,716 $ 436,890 $ 42,826 9.8 %
Less: Property-level operating expenses (344,704) (329,563) (15,141) (4.6)
Segment NOI $ 135,012 $ 107,327 $ 27,685 25.8

Number of Properties at March 31, Average Unit Occupancy for the Three Months Ended March 31, Average Monthly Revenue Per Occupied Room For the Three Months Ended March 31,
2022 2021 2022 2021 2022 2021
Same-store communities 321 321 83.0 % 78.8 % $ 4,821 $ 4,625


	For the Three Months Ended March 31,				Increase to NOI
	2023		2022		$		%
Same-Store NOI—Triple-Net Leased Properties:
Rental income	$	149,738	$	146,426	$	3,312	2.3	%
Less: Property-level operating expenses	(3,794)		(3,798)		4		0.1
NOI	$	145,944	$	142,628	$	3,316	2.3

The NOI increase in our same-store senior living operations reportable business segment NOI was primarily driven by an overall increase in occupancy and revenue per occupied room from strong in place resident rate increases in the U.S. and improving re-leasing spreads as well as higher HHS grants received, which are reflected as a reduction in property-level operating expenses, partially offset by higher operating expenses, driven by macro inflationary impacts including labor, utilities and other operating expenses. During the first quarter of 2022 and 2021, HHS grants received reduced property-level operating expenses by $21.1 million, net of management fees of $1.1 million, and $7.6 million, respectively.

~~Segment NOI—Office Operations~~

The following table summarizes results of operations in our office operations reportable business segment, including assets sold or classified as held for sale as of March 31, 2022 (dollars in thousands). For properties in our office operations reportable business segment, occupancy generally reflects occupied square footage divided by net rentable square footage as of the end of the reporting period.

For the Three Months Ended March 31, Increase (Decrease)
to Segment NOI
2022 2021 $ %
Segment NOI—Office Operations:
Rental income $ 200,540 $ 197,455 $ 3,085 1.6 %
Office building and other services revenue 617 2,345 (1,728) (73.7)
Total revenues 201,157 199,800 1,357 0.7
Less:
Property-level operating expenses (63,183) (63,946) 763 1.2
Office building and other services costs — (618) 618 100.0
Segment NOI $ 137,974 $ 135,236 $ 2,738 2.0

Number of Properties at March 31, Occupancy at March 31, Annualized Average Rent Per Occupied Square Foot for the Three Months Ended March 31,
2022 2021 2022 2021 2022 2021
Total office buildings 361 373 90.5 % 89.3 % $ 36 $ 34

~~The increase in office operations reportable business segment NOI~~triple-net leased portfolio for the three months ended March 31, ~~2022~~2023 compared to the same period in ~~2021~~2022 was primarily ~~due to successful new leasing, sustained tenant retention, improved parking revenues, revenues from exiting tenants~~driven by additional rental income received and ~~the acquisitions of 18 MOBs and one behavioral health center during the first quarter of 2022,~~contractual rent escalators, partially offset by ~~dispositions of non-core assets during 2021.~~previously executed lease resolutions with several smaller senior housing triple-net tenants who were materially affected by COVID-19.

~~The following table compares results of operations for our 332 same-store office buildings (dollars in thousands):~~

For the Three Months Ended March 31, Increase (Decrease)
to Segment NOI
2022 2021 $ %
Same-Store Segment NOI—Office Operations:
Rental income $ 192,093 $ 180,307 $ 11,786 6.5 %
Less: Property-level operating expenses (59,811) (56,753) (3,058) (5.4)
Segment NOI $ 132,282 $ 123,554 $ 8,728 7.1

Number of Properties at March 31, Occupancy at March 31, Annualized Average Rent Per Occupied Square Foot for the Three Months Ended March 31,
2022 2021 2022 2021 2022 2021
Same-store office buildings 332 332 91.8 % 91.5 % $ 37 $ 35

The increase in our same-store office operations reportable business segment NOI for the three months ended March 31, 2022 over the same period in 2021 was primarily due to contractual rent escalators, successful new leasing, sustained tenant retention, improved parking income and revenues from exiting tenants.

NOI—Non-Segment

Information provided for non-segment NOI includes management fees and promote revenues, net of expenses, related to our third-party institutional capital management business, income from loans and investments and ~~other miscellaneous income~~various corporate-level expenses not directly attributable to any of our three reportable business segments. The ~~$9.7~~$3.6 million ~~decrease~~increase in non-segment NOI for the three months ended March 31, ~~2022 over~~2023 compared to the same period in ~~2021~~2022 was primarily due to ~~lower~~higher interest income from loans receivable and investments asdue to higher interest rates, partially offset by a ~~result of repayments during the course of 2021 of~~$43.4 million loan ~~investments held by the Company.~~investment that was repaid at par in February 2023.

Company Results

Interest ~~Expense~~and Other Income

~~Interest expense was relatively flat~~The $1.2 million increase in interest and other income for the three months ended March 31, ~~2022~~2023 compared to the same period in ~~2021~~2022 was primarily due to anhigher interest rates earned on our bank deposits.

Interest Expense

The $17.3 million increase ~~of $3.1 million from an increased debt balance and $0.6 million of lower capitalized~~in interest ~~offset by a decrease of $3.7 million~~expense for the three months ended March 31, 2023 compared to the same period in 2022 was due to a ~~lower~~higher effective interest rate. Our weighted average debt outstanding was $12.4 billion and $12.3 billion for the three months ended March 31, 2023 and 2022, respectively. Our weighted average effective interest rate was ~~3.49%~~4.04% and ~~3.62%~~3.49% for the three months ended March 31, ~~2022~~2023 and ~~2021,~~2022, respectively. Capitalized interest was $2.7 million and $2.5 million for the three months ended March 31, ~~2022~~2023 and ~~2021 was $2.5 million and $3.1 million,~~2022, respectively.

Depreciation and Amortization

The ~~$25.1~~$6.9 million decrease in depreciation and amortization expense for the three months ended March 31, 2023 compared to the same period in 2022 was primarily due to ~~$78.5 million of impairments~~less impairment recognized in the first quarter of ~~2021 for properties sold or classified~~2023 as ~~held for sale, partially offset by $41.9 million of depreciation on assets acquired from New Senior, and $14.3 million of impairments recognized~~compared to the same period in ~~the first quarter of~~ 2022.

General, Administrative and Professional Fees

The ~~$2.7~~$1.8 million increase in general, administrative and professional fees for the three months ended March 31, 2023 compared to the same period in 2022 was primarily due to ~~the inclusion of a portion of New Senior’s overhead~~inflationary impacts and the return to a more normalized business environment.

~~Loss on Extinguishment of Debt, Net~~

The $27.1 million decrease in loss on extinguishment of debt, net is primarily related to the first quarter 2021 make whole redemption for the entirety of the $400.0 million aggregate principal amount of 3.10% seniors notes due January 2023.

Transaction Expenses and Deal Costs

The ~~$15.4~~$18.6 million ~~increase~~decrease in transaction expenses and deal costs for the three months ended March 31, 2023 compared to the same period in 2022 was primarily due to ~~$12.0 million of~~higher costs ~~incurred~~in 2022 in connection with stockholder relations ~~matters as well as costs associated with operator transitions.~~matters.

Allowance on Loans Receivable and Investments

The ~~$8.8~~$8.0 million ~~decrease~~change in allowance on loans receivable and investments for the three months ended March 31, 2023 compared to the same period in 2022 was due to an $8.0 million partial reversal in the current quarter of the $20.0 million allowance recognized in the fourth quarter of 2022 on the Santerre Mezzanine Loan, resulting in a remaining $12.0 million allowance, primarily due to a change in ~~our estimate~~the fair value of ~~credit losses during~~ the ~~first quarter of 2021~~Santerre Senior Loan and ~~the corresponding reversal of allowances as~~working capital. As of March 31, ~~2021.~~2023, the Santerre Mezzanine Loan had a gross book value of $485.3 million. On May 1, 2023, we took ownership of the collateral that supported the Santerre Mezzanine Loan by converting the outstanding principal amount of the Santerre Mezzanine Loan to equity, with no additional consideration being paid. As a result, the Santerre Mezzanine Loan is no longer outstanding.

Other

The ~~$17.8~~$35.0 million ~~increase~~change in other ~~income~~expense for the three months ended March 31, 2023 compared to the same period in 2022 was primarily due to ~~an increase~~a decrease of ~~$8.6 million due to insurance proceeds received during the first quarter of 2022 and expenses incurred during the first quarter of 2021 relating to winter storms and an increase of $7.6~~$27.6 million in unrealized gain on stock warrants received in connection with the Brookdale Senior Living lease modification inand a $6.6 million change relating to materially disruptive events, primarily clean-up costs and impairment associated with winter storm Elliott. As of March 31, 2023, the ~~third quarter~~fair value of ~~2020.~~the stock warrants was $24.6 million, which was $3.5 million lower than the value at the grant date.

Loss from Unconsolidated Entities

The ~~$4.0~~$1.4 million increase in loss from unconsolidated entities for the three months ended March 31, 2023 compared to the same period in 2022 was primarily due to our share of ~~increased~~higher net loss from our ~~investees.~~unconsolidated entities.

Gain on Real Estate Dispositions

~~Gain~~The $7.7 million increase in gain on real estate dispositions ~~was relatively flat~~ for the three months ended March 31, ~~2022~~2023 compared to the same period in ~~2021, and relates~~2022 was primarily due to the dispositions of five senior housing communities (three of which were vacant), four MOBs and two vacant triple-net leased properties, which resulted in a gain on sale of ~~a vacant land parcel in~~$10.2 million recognized during the first quarter of ~~2022 and the sale of two MOBs and one triple-net leased property in the first quarter of 2021.~~2023.

Income Tax Benefit ~~(Expense)~~

The $2.8 million of income tax benefit for the three months ended March 31, 2023 was primarily due to operating losses at certain of our TRS entities. The $4.5 million of income tax benefit for the three months ended March 31, 2022 ~~as compared to the $2.2 million of income tax expense for the same period in 2021~~ was primarily due to ~~operating~~ losses atin certain of our TRS entities and a ~~net~~$2.0 million benefit ~~for the unwind~~from an internal restructuring of ~~certain tax credit structure during the first quarter of 2022.~~a U.S. taxable REIT subsidiary.

Non-GAAP Financial Measures

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

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

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

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

We use the National Association of Real Estate Investment Trusts (“Nareit”) definition of FFO. Nareit defines FFO as net income attributable to common stockholders (computed in accordance with GAAP) excluding gains (or losses) from sales of real estate property, including gain (or loss) on re-measurement of equity method investments and impairment write-downs of depreciable real estate, plus real estate depreciation and amortization, and after adjustments for unconsolidated ~~partnerships~~entities and ~~entities.~~noncontrolling interests. Adjustments for unconsolidated ~~partnerships~~entities and ~~entities~~noncontrolling interests will be calculated to reflect FFO on the same basis. We define Normalized FFO as Nareit FFO excluding the following income and expense items, ~~(which may be recurring in nature):~~without duplication: (a) transaction ~~costs and expenses, including amortization of intangibles, transition and integration~~ expenses and deal costs, including transaction, integration and severance-related costs and expenses, and amortization of intangibles, in each case net of noncontrolling interests’ share of these items and including ~~expenses and recoveries relating to acquisition lawsuits;~~Ventas’ share of these items from unconsolidated entities; (b) the impact of ~~any~~ expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees or additional costs, expenses,

discounts, make-whole payments, penalties or premiums incurred as a result of early retirement or payment of our debt; (c) the non-cash effect of income tax benefits or expenses, the non-cash impact of changes to our executive equity compensation plan, derivative transactions that have non-cash mark-to-market impacts on our Consolidated Statements of Income and non-cash charges related to leases; (d) the financial impact of contingent ~~consideration, severance-related costs and charitable donations to the Ventas Charitable Foundation;~~consideration; (e) gains and losses for non-operational foreign currency hedge agreements and changes in the fair value of financial instruments; (f) gains and losses on non-real estate dispositions and other ~~unusual~~ items related to unconsolidated entities; (g) net expenses or recoveries related to ~~natural disasters~~materially disruptive events; and (h) ~~any~~ other ~~incremental~~ items set forth in the Normalized FFO reconciliation included herein.

The following table summarizes our FFO and Normalized FFO for the three months ended March 31, ~~2022~~2023 and ~~2021~~2022 (dollars in thousands). ~~The increase in~~ Normalized FFO for the three months ended March 31, 2022 includes $34.0 million of HHS grants received in 2022, which reduced property-level operating expenses. Excluding HHS grants, Normalized FFO for the three months ended March 31, 2023 increased over the same period in ~~2021 is primarily~~2022 due to increased net operating income atfrom our ~~senior housing communities~~properties led by our SHOP reportable business segment as a result of improved occupancy, higher revenue per occupied room, acquisitions since the first quarter of 2021, including the acquisition of over 100 independent living communities from New Senior, and higher HHS grants received,increased revenues, partially offset by ~~lower~~higher interest ~~income on loan investments.~~expense.


		For the Three Months Ended March 31,				For the Three Months Ended March 31,
		2022		2021				2023		2022
Net income (loss) attributable to common stockholders		$	38,732	$	(57,209)
Net income attributable to common stockholders							Net income attributable to common stockholders	$	17,517	$	38,732
Adjustments:	Adjustments:						Adjustments:
Depreciation and amortization on real estate assets	Depreciation and amortization on real estate assets	288,103		312,869			Depreciation and amortization on real estate assets	281,477		288,103
Depreciation on real estate assets related to noncontrolling interests	Depreciation on real estate assets related to noncontrolling interests	(4,449)		(4,618)			Depreciation on real estate assets related to noncontrolling interests	(4,377)		(4,449)
Depreciation on real estate assets related to unconsolidated entities	Depreciation on real estate assets related to unconsolidated entities	7,265		4,018			Depreciation on real estate assets related to unconsolidated entities	10,177		7,265
Gain on real estate dispositions	Gain on real estate dispositions	(2,455)		(2,533)			Gain on real estate dispositions	(10,201)		(2,455)
Gain on real estate dispositions related to noncontrolling interests		17		—
FFO attributable to common stockholders		327,213		252,527
(Loss) gain on real estate dispositions related to noncontrolling interests							(Loss) gain on real estate dispositions related to noncontrolling interests	(5)		17
Gain on real estate dispositions and other related to unconsolidated entities							Gain on real estate dispositions and other related to unconsolidated entities	(180)		—

Nareit FFO attributable to common stockholders							Nareit FFO attributable to common stockholders	294,408		327,213
Adjustments:	Adjustments:						Adjustments:
Change in fair value of financial instruments	Change in fair value of financial instruments	(29,881)		(21,008)			Change in fair value of financial instruments	(77)		(29,881)
Non-cash income tax (benefit) expense		(5,805)		1,344
Loss on extinguishment of debt, net		—		27,090
Gain on transactions related to unconsolidated entities		(3)		(21)
Transaction expenses and deal costs		21,288		5,360
Amortization of other intangibles		268		116
Non-cash income tax benefit							Non-cash income tax benefit	(4,272)		(5,805)

Loss (gain) on transactions related to unconsolidated entities							Loss (gain) on transactions related to unconsolidated entities	180		(3)
Transaction expenses and deal costs, net of noncontrolling interests and including Ventas’ share attributable to unconsolidated entities							Transaction expenses and deal costs, net of noncontrolling interests and including Ventas’ share attributable to unconsolidated entities	2,104		21,288
Amortization of other intangibles including Ventas’ share attributable to unconsolidated entities							Amortization of other intangibles including Ventas’ share attributable to unconsolidated entities	96		268
Other items related to unconsolidated entities	Other items related to unconsolidated entities	131		101			Other items related to unconsolidated entities	1,087		131
Non-cash impact of changes to equity plan	Non-cash impact of changes to equity plan	7,206		8,741			Non-cash impact of changes to equity plan	7,222		7,206
Natural disaster (recoveries) expenses, net		(3,709)		5,127
Materially disruptive events, net including Ventas’ share attributable to unconsolidated entities							Materially disruptive events, net including Ventas’ share attributable to unconsolidated entities	4,186		(3,709)

Allowance on loan investments, net of noncontrolling interests		(53)		(8,900)
Allowance on loan investments and impairment of unconsolidated entities, net of noncontrolling interests							Allowance on loan investments and impairment of unconsolidated entities, net of noncontrolling interests	(8,063)		(53)
Normalized FFO attributable to common stockholders	Normalized FFO attributable to common stockholders	$	316,655	$	270,477		Normalized FFO attributable to common stockholders	$	296,871	$	316,655

4138

NOI

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

The following table sets forth a reconciliation of net income attributable to common stockholders to NOI (dollars in thousands):


		For the Three Months Ended March 31,				For the Three Months Ended March 31,
		2022		2021				2023		2022
Net income (loss) attributable to common stockholders		$	38,732	$	(57,209)
Net income attributable to common stockholders							Net income attributable to common stockholders	$	17,517	$	38,732
Adjustments:	Adjustments:						Adjustments:
Interest and other income	Interest and other income	(536)		(341)			Interest and other income	(1,743)		(536)
Interest expense	Interest expense	110,794		110,767			Interest expense	128,075		110,794
Depreciation and amortization	Depreciation and amortization	289,064		314,148			Depreciation and amortization	282,119		289,064
General, administrative and professional fees	General, administrative and professional fees	42,998		40,309			General, administrative and professional fees	44,798		42,998
Loss on extinguishment of debt, net		—		27,090

Transaction expenses and deal costs	Transaction expenses and deal costs	19,992		4,617			Transaction expenses and deal costs	1,386		19,992
Allowance on loans receivable and investments	Allowance on loans receivable and investments	(54)		(8,902)			Allowance on loans receivable and investments	(8,064)		(54)
Other	Other	(27,190)		(9,428)			Other	7,762		(27,190)
Net income attributable to noncontrolling interests	Net income attributable to noncontrolling interests	1,860		1,811			Net income attributable to noncontrolling interests	1,395		1,860
Loss from unconsolidated entities	Loss from unconsolidated entities	4,269		250			Loss from unconsolidated entities	5,623		4,269
Income tax (benefit) expense		(4,490)		2,153
Income tax benefit							Income tax benefit	(2,802)		(4,490)
Gain on real estate dispositions	Gain on real estate dispositions	(2,455)		(2,533)			Gain on real estate dispositions	(10,201)		(2,455)
NOI	NOI	$	472,984	$	422,732		NOI	$	465,865	$	472,984

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

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

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

To eliminate the impact of exchange rate movements, all portfolio performance-based disclosures assume constant exchange rates across comparable periods, using the following methodology: the current period’s results are shown in actual

reported USD, while prior comparison period’s results are adjusted and converted to USD based on the average exchange rate for the current period.

Liquidity and Capital Resources

Our principal sources of liquidity are cash flows from operations, proceeds from the issuance of debt and equity securities, borrowings under our unsecured revolving credit facility and commercial paper program, and proceeds from asset sales.

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

Our material contractual obligations arising in the normal course of business primarily consist of long-term debt and related interest payments, and operating obligations which include ground lease obligations. During the three months ended March 31, ~~2022,~~2023, there were no significant changes to our contractual obligations from those disclosed in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our ~~2021~~2022 Annual Report. See “Note 109 – Senior Notes Payable And Other Debt” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information regarding our significant debt activities.

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

Loans Receivable and Investments

As of March 31, 2023, the Santerre Mezzanine Loan had a principal balance of $486.1 million and gross book value of $485.3 million, and was priced at LIBOR + 6.42%. On May 1, 2023, we took ownership of the collateral that supported the Santerre Mezzanine Loan by converting the outstanding principal amount of the Santerre Mezzanine Loan to equity, with no additional consideration being paid. As a result, of the COVID-19 pandemic could lead to downgrades of our long-term credit rating and therefore adversely impact our cost of borrowing, we currently believe we will continue to have access to one or more debt markets during the duration of the pandemic and could seek to enter into secured debt financings or issue debt and equity securities to satisfy our liquidity needs, althoughSanterre Mezzanine Loan is no ~~assurances can be made in this regard.~~longer outstanding.

Credit Facilities, Commercial Paper, ~~and~~ Unsecured Term Loans

We have a $2.75 billion unsecured revolving credit facility initially priced at LIBOR plus 0.825% based on the Company’s debt rating. The unsecured revolving credit facility matures in January 2025, but may be extended at our option, subject to the satisfaction and Letters of certain conditions, for two additional periods of six months each. The credit facility also includes an accordion feature that permits us to increase our aggregate borrowing capacity thereunder to up to $3.75 billion, subject to the satisfaction of certain conditions.Credit

~~As of March 31, 2022,~~2023, we had a C$500.0 million unsecured term loan facility priced at Canadian Dollar Offered Rate (“CDOR”) plus 0.90% that matures in 2025.

4340

Senior Notes

~~We may, from time~~In April 2023, our 100% owned subsidiary, Ventas Canada Finance Limited (“Ventas Canada”), issued and sold C$600.0 million aggregate principal amount of 5.398% Senior Notes due 2028 in a private placement at par. Pursuant to ~~time, seek~~cash tender offers, we used the proceeds to ~~retire or purchase our~~repurchase C$613.7 million in aggregate principal amount of outstanding senior notes due in 2024 for ~~cash~~an aggregate purchase price of C$600.0 million plus accrued and unpaid interest as disclosed below:

Mortgages

In March 2023, we entered into a C$271.8 million floating rate mortgage debt maturing in 2028 with an interest rate of CDOR + 0.88%. The mortgage is secured by 14 SHOP communities in Canada.

On May 1, 2023, we took ownership of the collateral that supported the Santerre Mezzanine Loan, which we refer to as the Santerre Portfolio, by converting the outstanding principal amount of the Santerre Mezzanine Loan to equity, with no additional consideration being paid. Our ownership of the Santerre Portfolio is subject to an existing approximately $1 billion non-recourse Santerre Senior Loan, which is secured by the Santerre Portfolio, bears interest at a current weighted average rate of LIBOR + 1.84% and matures on June 9, 2023. We have given notice to extend the maturity of the Santerre Senior Loan to June 2024, which is subject to the satisfaction of certain conditions, including entering into an interest rate cap for the extension period. The Santerre Senior Loan can be repaid in whole or in exchange for equity securities in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, prospects for capitalpart prior to its maturity, without penalty, and ~~other factors. The amounts involved may~~assets can be ~~material.~~released from the liens, subject to certain conditions.

Equity Offerings

Derivatives and Hedging

In March and April 2023, we entered into a total of $250.0 million aggregate forward starting swaps with a ten-year weighted average rate of 3.37%:

Dividends

During the three months ended March 31, ~~2022,~~2023, we declared a dividend of $0.45 per share of our common stock. In order to continue to qualify as a REIT, we must make annual distributions to our stockholders of at least 90% of our REIT taxable income (excluding net capital gain). In addition, we will be subject to income tax at the regular corporate rate to the extent we distribute less than 100% of our REIT taxable income, including any net capital gains. We intend to pay dividends greater than 100% of our taxable income, after the use of any net operating loss carryforwards, for ~~2022.~~2023.

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

Cash Flows

The following table sets forth our sources and uses of cash flows for the three months ended March 31, ~~2022~~2023 and ~~2021~~2022 (dollars in thousands):

For the Three Months Ended March 31, (Decrease) Increase to Cash
2022 2021 $ %
Cash, cash equivalents and restricted cash at beginning of period $ 196,597 $ 451,640 $ (255,043) (56.5) %
Net cash provided by operating activities 274,553 237,593 36,960 15.6
Net cash used in investing activities (437,326) (102,612) (334,714) nm
Net cash provided by (used in) financing activities 165,382 (377,067) 542,449 143.9
Effect of foreign currency translation 241 658 (417) (63.4)
Cash, cash equivalents and restricted cash at end of period $ 199,447 $ 210,212 $ (10,765) (5.1) %

~~nm - not meaningful~~


	For the Three Months Ended March 31,				(Decrease) Increase to Cash
	2023		2022		$		%
Cash, cash equivalents and restricted cash at beginning of period	$	170,745	$	196,597	$	(25,852)	(13.1)%
Net cash provided by operating activities	242,817		274,553		(31,736)		(11.6)
Net cash used in investing activities	(56,280)		(437,326)		381,046		87.1
Net cash (used in) provided by financing activities	(162,107)		165,382		(327,489)		(198.0)
Effect of foreign currency translation	106		241		(135)		(56.0)
Cash, cash equivalents and restricted cash at end of period	$	195,281	$	199,447	$	(4,166)	(2.1)

Cash Flows from Operating Activities

Cash flows from operating activities ~~increased $37.0~~decreased $31.7 million during the three months ended March 31, ~~2022~~2023 compared to the same period in ~~2021~~2022 primarily due to ~~increased net operating income at our senior housing communities, including the net benefit of~~no HHS grants received and ~~acquisitions since the first quarter of 2021, including the acquisition of over 100 independent living communities from New Senior,~~higher interest expense in 2023, partially offset by ~~lower interest income on loan investments~~higher property NOI in 2023, and ~~increased~~higher transaction expenses and deal costs ~~primarily due to expenses relating to the~~in 2022 in connection with stockholder relations ~~matters in the first quarter of 2022.~~matters.

Cash Flows from Investing Activities

Cash flows from investing activities ~~decreased $334.7~~increased $381.0 million during the three months ended March 31, ~~2022~~2023 compared to the same period in ~~2021~~2022 primarily due to ~~the $349.2 million paid~~higher acquisition volume in ~~connection with the acquisition of 18 MOBs, one behavioral health center and one senior housing community, partially offset by lower development project expenditures in the first quarter of~~ 2022.

Cash Flows from Financing Activities

Cash flows from financing activities ~~increased $542.4~~decreased $327.5 million during the three months ended March 31, ~~2022~~2023 compared to the same period in ~~2021~~2022 primarily due to ~~the March 2021 redemption of $400.0 million senior notes due 2023, and increased~~decreased borrowings under our commercial paper program ~~and proceeds from debt~~ in ~~the first quarter of 2022.~~2023.

Capital Expenditures

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

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

We are party to certain agreements that obligate us to develop senior housing or healthcare properties funded through capital that we and, in certain circumstances, our joint venture partners provide. As of March 31, ~~2022,~~2023, we had ~~15 properties under development~~seven active and committed projects pursuant to these agreements, including ~~six properties~~three projects that are ~~owned by an unconsolidated real estate entity.~~ unconsolidated.

In addition, from time to time, we engage in redevelopment projects with respect to our existing senior housing communities to maximize the value, increase NOI, maintain a market-competitive position, achieve property stabilization or change the primary use of the property.

Off-Balance Sheet Arrangements

We own interests in certain unconsolidated entities as described in “Note 76 – Investments In Unconsolidated Entities.” Except in limited circumstances, our risk of loss is limited to our investment in the joint venture and any outstanding loans receivable. In addition, we have certain properties which serve as collateral for debt that is owed by a previous owner of certain of our facilities, as described under “Note 109 – Senior Notes Payable And Other Debt” to the Consolidated Financial Statements. Our risk of loss for these certain properties is limited to the outstanding debt balance plus penalties, if any. Further, we use financial derivative instruments to hedge interest rate and foreign currency exchange rate exposure. Finally, at March 31, ~~2022,~~2023, we had ~~$25.0~~$15.7 million outstanding letters of credit obligations. We have no other material off-balance sheet arrangements that we expect would materially affect our liquidity and capital resources except those described above.

Guarantor and Issuer Financial Information

Ventas, Inc. has fully and unconditionally guaranteed the obligation to pay principal and interest with respect to the outstanding senior notes issued by our 100% owned subsidiary, Ventas Realty. None of our other subsidiaries is obligated with respect to Ventas Realty’s outstanding senior notes.

Ventas, Inc. has also fully and unconditionally guaranteed the obligation to pay principal and interest with respect to the outstanding senior notes issued by our 100% owned subsidiary, Ventas Canada Finance Limited (“Ventas Canada”). None of our other subsidiaries is obligated with respect to Ventas Canada’s outstanding senior notes, all of which were issued on a private placement basis in Canada.

In connection with the acquisition of Nationwide Health Properties, Inc. (“NHP”), our 100% owned subsidiary Nationwide Health Properties, LLC (“NHP LLC”), as successor to NHP, assumed the obligation to pay principal and interest

with respect to the outstanding senior notes issued by NHP. Neither we nor any of our subsidiaries (other than NHP LLC) is obligated with respect to any of NHP LLC’s outstanding senior notes.

In addition, Ventas, Inc. has fully and unconditionally guaranteed the obligations under our $2.75 billion unsecured revolving credit facility, our C$500.0 million unsecured term loan facility, the New Credit Agreement and our $100.0 million uncommitted line for standby letters of credit.

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

The following summarizes our guarantor and issuer balance sheet and statement of income information as of March 31, ~~2022~~2023 and December 31, ~~2021~~2022 and for the three months ended March 31, ~~2022~~2023 and the year ended December 31, ~~2021~~2022 (in thousands). for each of Ventas Realty, as issuer of certain notes registered under the Exchange Act, and Ventas, Inc., on an unconsolidated basis, as guarantor of such notes:

Balance Sheet Information


		As of March 31, 2022					As of March 31, 2023
		Guarantor		Issuer			Guarantor		Issuer
Assets	Assets					Assets
Investment in and advances to affiliates	Investment in and advances to affiliates	$	17,789,558	$	3,045,738	Investment in and advances to affiliates	$	17,774,593	$	3,049,374
Total assets	Total assets	17,922,405		3,155,639		Total assets	17,839,481		3,154,642
Liabilities and equity	Liabilities and equity					Liabilities and equity
Intercompany loans	Intercompany loans	11,313,313		(3,863,941)		Intercompany loans	11,995,794		(3,784,207)
Total liabilities	Total liabilities	11,537,000		4,133,468		Total liabilities	12,200,374		4,313,214
Redeemable OP unitholder and noncontrolling interests	Redeemable OP unitholder and noncontrolling interests	96,646		—		Redeemable OP unitholder and noncontrolling interests	102,616		—
Total equity (deficit)	Total equity (deficit)	6,288,759		(977,829)		Total equity (deficit)	5,536,491		(1,158,572)
Total liabilities and equity	Total liabilities and equity	17,922,405		3,155,639		Total liabilities and equity	17,839,481		3,154,642


		As of December 31, 2021					As of December 31, 2022
		Guarantor		Issuer			Guarantor		Issuer
Assets	Assets					Assets

Investment in and advances to affiliates	Investment in and advances to affiliates	$	17,448,874	$	3,045,738	Investment in and advances to affiliates	$	17,691,107	$	3,049,374

Total assets	Total assets	17,561,305		3,156,840		Total assets	17,752,892		3,155,014
Liabilities and equity	Liabilities and equity					Liabilities and equity

Intercompany loans	Intercompany loans	10,742,915		(3,563,060)		Intercompany loans	11,704,160		(3,825,402)

Total liabilities	Total liabilities	10,972,521		4,097,362		Total liabilities	11,925,997		4,263,316
Redeemable OP unitholder and noncontrolling interests	Redeemable OP unitholder and noncontrolling interests	98,356		—		Redeemable OP unitholder and noncontrolling interests	102,148		—
Total equity (deficit)	Total equity (deficit)	6,490,428		(940,522)		Total equity (deficit)	5,724,747		(1,108,302)
Total liabilities and equity	Total liabilities and equity	17,561,305		3,156,840		Total liabilities and equity	17,752,892		3,155,014

~~Statement of Income Information~~

For the Three Months Ended March 31, 2022
Guarantor Issuer
Equity earnings in affiliates $ 44,555 $ —
Total revenues 46,321 36,683
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests 39,202 (40,293)
Net income (loss) 38,732 (40,293)
Net income (loss) attributable to common stockholders 38,732 (40,293)

For the Year Ended December 31, 2021
Guarantor Issuer
Equity earnings in affiliates $ 133,143 $ —
Total revenues 137,348 158,255
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests 49,694 (215,773)
Net income (loss) 49,008 (215,777)
Net income (loss) attributable to common stockholders 49,008 (215,777)

4744

Statement of Income Information


	For the Three Months Ended March 31, 2023
	Guarantor		Issuer
Equity earnings in affiliates	$	40,494	$	—
Total revenues	41,209		35,635
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests	18,066		(50,152)
Net income (loss)	17,517		(50,152)
Net income (loss) attributable to common stockholders	17,517		(50,152)


	For the Year Ended December 31, 2022
	Guarantor		Issuer
Equity earnings in affiliates	$	43,317	$	—
Total revenues	45,037		145,560
Loss before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests	(45,383)		(173,407)
Net loss	(47,447)		(173,407)
Net loss attributable to common stockholders	(47,447)		(173,407)

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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

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

As of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, the fair value of our secured and non-mortgage loans receivable, based on our estimates of current prevailing rates for comparable loans, was ~~$507.3~~$524.7 million and ~~$498.0~~$517.0 million, respectively.

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

To highlight the sensitivity of our fixed rate debt to changes in interest rates, the following summary shows the effects of a hypothetical instantaneous change of 100 basis points in interest rates (dollars in thousands):

As of March 31, 2022 As of December 31, 2021
Gross book value $ 11,065,729 $ 10,990,982
Fair value 11,086,862 11,766,336
Fair value reflecting change in interest rates:
-100 basis points 11,667,702 12,437,306
+100 basis points 10,560,572 11,164,150

The increase in our fixed rate debt from December 31, 2021 to March 31, 2022 was primarily due to the refinancing of a variable rate mortgage to a fixed rate mortgage in 2022 and exchange rate fluctuations related to our outstanding senior notes.


	As of March 31, 2023		As of December 31, 2022
Gross book value	$	11,109,628	$	10,863,436
Fair value	10,412,218		10,010,935
Fair value reflecting change in interest rates:
-100 basis points	10,854,267		10,449,991
+100 basis points	10,006,173		9,607,787

4846

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


		As of March 31, 2022			As of December 31, 2021			As of March 31, 2021				As of March 31, 2023			As of December 31, 2022			As of March 31, 2022
Balance:	Balance:										Balance:
Fixed rate:	Fixed rate:										Fixed rate:
Senior notes	Senior notes	$	8,745,345		$	8,729,102		$	8,483,829		Senior notes	$	8,427,591		$	8,627,540		$	8,745,345
Unsecured term loans	Unsecured term loans	200,000			200,000			200,000			Unsecured term loans	400,000			200,000			200,000

Mortgage loans and other	Mortgage loans and other	2,120,384			2,061,880			1,390,256			Mortgage loans and other	2,282,037			2,035,896			2,120,384
Subtotal fixed rate	Subtotal fixed rate	11,065,729			10,990,982			10,074,085			Subtotal fixed rate	11,109,628			10,863,436			11,065,729
Variable rate:	Variable rate:										Variable rate:
Senior notes		—			—			238,892

Unsecured revolving credit facility	Unsecured revolving credit facility	46,037			56,448			44,799			Unsecured revolving credit facility	40,210			25,230			46,037
Unsecured term loans	Unsecured term loans	400,032			395,757			398,152			Unsecured term loans	469,959			669,031			400,032
Commercial paper notes	Commercial paper notes	636,948			280,000			215,000			Commercial paper notes	425,000			403,000			636,948
Secured revolving construction credit facility		—			—			154,281

Mortgage loans and other	Mortgage loans and other	329,130			369,951			724,955			Mortgage loans and other	362,146			400,547			329,130
Subtotal variable rate	Subtotal variable rate	1,412,147			1,102,156			1,776,079			Subtotal variable rate	1,297,315			1,497,808			1,412,147
Total	Total	$	12,477,876		$	12,093,138		$	11,850,164		Total	$	12,406,943		$	12,361,244		$	12,477,876
Percentage of total debt:	Percentage of total debt:										Percentage of total debt:
Fixed rate:	Fixed rate:										Fixed rate:
Senior notes	Senior notes	70.1		%	72.1		%	71.6		%	Senior notes	67.9		%	69.8		%	70.1		%
Unsecured term loans	Unsecured term loans	1.6			1.7			1.7			Unsecured term loans	3.2			1.6			1.6

Mortgage loans and other	Mortgage loans and other	17.0			17.0			11.7			Mortgage loans and other	18.4			16.5			17.0
Variable rate:	Variable rate:										Variable rate:
Senior notes		—			—			2.0

Unsecured revolving credit facility	Unsecured revolving credit facility	0.4			0.5			0.4			Unsecured revolving credit facility	0.3			0.2			0.4
Unsecured term loans	Unsecured term loans	3.2			3.3			3.4			Unsecured term loans	3.8			5.4			3.2
Commercial paper notes	Commercial paper notes	5.1			2.3			1.8			Commercial paper notes	3.4			3.3			5.1
Secured revolving construction credit facility		—			—			1.3

Mortgage loans and other	Mortgage loans and other	2.6			3.1			6.1			Mortgage loans and other	3.0			3.2			2.6
Total	Total	100.0		%	100.0		%	100.0		%	Total	100.0		%	100.0		%	100.0		%
Weighted average interest rate at end of period:	Weighted average interest rate at end of period:										Weighted average interest rate at end of period:
Fixed rate:	Fixed rate:										Fixed rate:
Senior notes	Senior notes	3.7		%	3.7		%	3.8		%	Senior notes	3.7		%	3.7		%	3.7		%
Unsecured term loans	Unsecured term loans	3.6			3.6			3.6			Unsecured term loans	4.7			3.6			3.6

Mortgage loans and other	Mortgage loans and other	3.6			3.6			3.5			Mortgage loans and other	4.0			3.7			3.6
Variable rate:	Variable rate:										Variable rate:
Senior notes		—			—			1.0

Unsecured revolving credit facility	Unsecured revolving credit facility	1.6			1.1			1.0			Unsecured revolving credit facility	5.4			4.5			1.6
Unsecured term loans	Unsecured term loans	1.8			1.4			1.3			Unsecured term loans	5.8			5.5			1.8
Commercial paper notes	Commercial paper notes	0.8			0.3			0.2			Commercial paper notes	5.2			4.7			0.8
Secured revolving construction credit facility		—			—			1.9

Mortgage loans and other	Mortgage loans and other	1.8			1.7			1.9			Mortgage loans and other	5.2			5.1			1.8
Total	Total	3.4			3.4			3.4			Total	4.0			3.9			3.4

The variable rate debt in the table above reflects, in part, the effect of ~~$145.5~~$144.2 million notional amount of interest rate swaps ~~maturing~~with maturities on March 2027, in each case that effectively convert fixed rate debt to variable rate debt. In addition, the fixed rate debt in the table above reflects, in part, the effect of ~~$302.4~~$537.7 million and C$~~272.5~~538.0 million notional amount of interest rate swaps with maturities ranging from ~~January~~October 2023 to April 2031, in each case that effectively convert variable rate debt to fixed rate debt. In the first quarter of 2023, we hedged an incremental $200.0 million of variable rate debt to fixed rate debt through the execution in March 2023 of two-year $400.0 million notional swaps on our unsecured term loan due in 2027, replacing a $200.0 million notional swap that matured in January 2023. The swap instruments are designated as cash flow hedges.

4947

The ~~increase~~decrease in our outstanding variable rate debt and increase in our outstanding fixed rate debt at March 31, ~~2022~~2023 compared to December 31, ~~2021~~2022 is primarily attributable to ~~borrowings under our commercial paper program.~~interest rate swap activity in 2023 effectively converting an incremental $200.0 million of variable rate debt to fixed rate debt.

Assuming a 100 basis point increase in the weighted average interest rate related to our consolidated variable rate debt and assuming no change in our consolidated variable rate debt outstanding as of March 31, ~~2022,~~2023 of $1.3 billion, interest expense on an annualized basis would increase by approximately ~~$13.5~~$13.0 million, or $0.03 per diluted common share.

As of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, our joint venture partners’ aggregate share of total consolidated debt was ~~$281.0~~$280.3 million and ~~$278.0~~$279.0 million, respectively, with respect to certain properties we owned through consolidated joint ventures.

Total consolidated debt does not include our portion of unconsolidated debt related to investments in unconsolidated real estate entities, which was ~~$370.9~~$469.1 million and ~~$338.1~~$454.4 million as of March 31, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively.

As a result of our Canadian and United Kingdom operations, we are subject to fluctuations in certain foreign currency exchange rates that may, from time to time, affect our financial condition and operating performance. Based solely on our results for the three months ended March 31, ~~2022~~2023 (including the impact of existing hedging arrangements), if the value of the U.S. dollar relative to the British pound and Canadian dollar were to increase or decrease by one standard deviation compared to the average exchange rate during the year, our Normalized FFO per share for the three months ended March 31, ~~2022~~2023 would decrease or increase as applicable, by less than $0.01 per share or 1%. We will continue to mitigate these risks through a layered approach to hedging looking out for the next year and continual assessment of our foreign operational capital structure. Nevertheless, we cannot assure you that any such fluctuations will not have an effect on our earnings.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As required by Rules 13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of March 31, ~~2022.~~2023. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of March 31, ~~2022,~~2023, at the reasonable assurance level.

Internal Control Over Financial Reporting

There have been no changes in our internal controls over financial reporting during the first quarter of ~~2022~~2023 (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

5048

PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The information contained in “Note 1211 – Commitments And Contingencies” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated by reference into this Item 1. Except as set forth therein, there have been no new material legal proceedings and no material developments in the legal proceedings reported in our ~~2021~~2022 Annual Report.

ITEM 1A. RISK FACTORS

~~This section supplements and updates, and should be read in conjunction with,~~In the ~~information found~~first quarter of 2023, there were no significant new risk factors from those disclosed under Part I, Item 1A. “Risk Factors” of our ~~2021 Annual Report based on information currently known to us and recent developments since the date of the 2021~~2022 Annual Report. However, the risks and uncertainties that we face are not limited to those set forth in the ~~2021~~2022 Annual ~~Report and this first quarter Form 10-Q.~~Report. Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also adversely affect our business, results of operations and financial condition.

~~Activist investors could cause us to incur substantial costs, divert management’s attention and have an adverse effect on our business.~~

Activist investors may from time to time engage in proxy solicitations, advance shareholder proposals or otherwise attempt to affect changes or acquire control over us. Responding to these actions can be costly and time-consuming, divert the attention of our Board and management from the management of our business and the pursuit of our business strategies. In addition to incurred costs, perceived uncertainties as to our future direction may result in the loss of potential business opportunities, damage to our reputation and may make it more difficult to attract and retain qualified directors, personnel and business partners. These actions could also cause our stock price to experience periods of volatility.

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

Issuer Purchases of Equity Securities

We do not have a publicly announced repurchase plan or program in effect. The table below summarizes other repurchases of our common stock made during the quarter ended March 31, ~~2022.~~2023.


		Number of Shares Repurchased (1)	Average Price Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs		Number of Shares Repurchased (1)	Average Price Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs
January 1 through January 31	January 1 through January 31	46,170	$	51.87	—	—	January 1 through January 31	169,436	$	48.77	—	—
February 1 through February 28	February 1 through February 28	27,227	51.37		—	—	February 1 through February 28	60,896	50.73		—	—
March 1 through March 31	March 1 through March 31	44,310	56.28		—	—	March 1 through March 31	34,327	48.56		—	—
Total	Total	117,707	$	53.41	—	—	Total	264,659	$	49.19	—	—

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

ITEM 5. OTHER INFORMATION

Not applicable.

5149

ITEM 6. EXHIBITS


Exhibit Number						Description of Document
4.1						Ninth Supplemental Indenture dated as of April 21, 2023 by and among Ventas Canada Finance Limited, as Issuer, Ventas, Inc., as Guarantor, and Computershare Trust Company of Canada, as Trustee, relating to the 5.398% Senior Notes, Series I due 2028.
22						List of Guarantors and Issuers of Guaranteed Securities.
31.1						Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.
31.2						Certification of Robert F. Probst, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.
32.1						Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.
32.2						Certification of Robert F. Probst, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.
101						The following materials from the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, ~~2022,~~2023, formatted in XBRL (Inline Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Equity, (v) the Consolidated Statements of Cash Flows and (vi) Notes to the Consolidated Financial Statements.
104						Cover Page Interactive Data File (formatted as inline XBRL).

5250

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: May ~~6, 2022~~9, 2023


			VENTAS, INC.

			By:			/s/ DEBRA A. CAFARO
						Debra A. Cafaro Chairman and Chief Executive Officer

			By:			/s/ ROBERT F. PROBST
						Robert F. Probst Executive Vice President and Chief Financial Officer

5351


	Amortized Cost		Allowance		Unrealized Gain		Carrying Amount		Fair Value
As of March 31, 2022:
Secured/mortgage loans and other, net	$	488,827	$	—	$	—	$	488,827	$	483,491
Government-sponsored pooled loan investments, net (1)	40,312		—		1,249		41,561		41,561
Total investments reported as secured loans receivable and investments, net	529,139		—		1,249		530,388		525,052
Non-mortgage loans receivable, net (2)	29,449		(5,333)		—		24,116		23,826

Total loans receivable and investments, net	$	558,588	$	(5,333)	$	1,249	$	554,504	$	548,878

As of December 31, 2021:
Secured/mortgage loans and other, net	$	488,913	$	—	$	—	$	488,913	$	478,931
Government-sponsored pooled loan investments, net (1)	39,376		—		1,836		41,213		41,213
Total investments reported as secured loans receivable and investments, net	528,289		—		1,836		530,126		520,144
Non-mortgage loans receivable, net (2)	24,418		(5,394)		—		19,024		19,039
Total loans receivable and investments, net	$	552,707	$	(5,394)	$	1,836	$	549,150	$	539,183


	For the Three Months Ended March 31, 2022
	Triple-Net Leased Properties		Senior Living Operations		Office Operations		Non-Segment		Total
Revenues:
Rental income	$	151,561	$	—	$	200,540	$	—	$	352,101
Resident fees and services	—		651,121		—		—		651,121
Office building and other services revenue	—		—		617		3,332		3,949
Income from loans and investments	—		—		—		9,847		9,847
Interest and other income	—		—		—		536		536
Total revenues	$	151,561	$	651,121	$	201,157	$	13,715	$	1,017,554

Total revenues	$	151,561	$	651,121	$	201,157	$	13,715	$	1,017,554
Less:
Interest and other income	—		—		—		536		536
Property-level operating expenses	4,008		475,530		63,183		—		542,721
Office building and other services costs	—		—		—		1,313		1,313
Segment NOI	$	147,553	$	175,591	$	137,974	$	11,866	472,984
Interest and other income									536
Interest expense									(110,794)
Depreciation and amortization									(289,064)
General, administrative and professional fees									(42,998)

Transaction expenses and deal costs									(19,992)
Allowance on loans receivable and investments									54
Other									27,190
Loss from unconsolidated entities									(4,269)
Gain on real estate dispositions									2,455
Income tax benefit									4,490
Income from continuing operations									40,592
Net income									40,592
Net income attributable to noncontrolling interests									1,860
Net income attributable to common stockholders									$	38,732


	For the Three Months Ended March 31,				Increase (Decrease) to Segment NOI
	2022		2021		$		%
Segment NOI—Senior Living Operations:
Resident fees and services	$	651,121	$	528,650	$	122,471	23.2	%
Less: Property-level operating expenses	(475,530)		(417,829)		(57,701)		(13.8)
Segment NOI	$	175,591	$	110,821	$	64,770	58.4


	For the Year Ended December 31, 2021
	Guarantor		Issuer
Equity earnings in affiliates	$	133,143	$	—
Total revenues	137,348		158,255
Income (loss) before unconsolidated entities, real estate dispositions, income taxes and noncontrolling interests	49,694		(215,773)
Net income (loss)	49,008		(215,777)
Net income (loss) attributable to common stockholders	49,008		(215,777)