Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 04, 2016 | |
Document and Entity Information | ||
Entity Registrant Name | SENIOR HOUSING PROPERTIES TRUST | |
Entity Central Index Key | 1,075,415 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 237,484,059 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Real estate properties: | ||
Land | $ 798,603 | $ 781,426 |
Buildings and improvements | 6,856,429 | 6,675,514 |
Total real estate properties, gross | 7,655,032 | 7,456,940 |
Accumulated depreciation | (1,236,109) | (1,147,540) |
Total real estate properties, net | 6,418,923 | 6,309,400 |
Cash and cash equivalents | 25,633 | 37,656 |
Restricted cash | 7,026 | 6,155 |
Acquired real estate leases and other intangible assets, net | 556,845 | 604,286 |
Other assets, net | 257,340 | 202,593 |
Total assets | 7,265,767 | 7,160,090 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Unsecured revolving credit facility | 749,000 | 775,000 |
Unsecured term loans, net | 546,681 | 546,305 |
Senior unsecured notes, net | 1,721,306 | 1,478,536 |
Secured debt and capital leases, net | 647,176 | 679,295 |
Accrued interest | 18,433 | 16,974 |
Assumed real estate lease obligations, net | 111,712 | 115,363 |
Other liabilities | 185,891 | 188,857 |
Total liabilities | 3,980,199 | 3,800,330 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Common shares of beneficial interest, $.01 par value: 300,000,000 shares authorized, 237,484,059 and 237,471,559 issued and outstanding at June 30, 2016 and December 31, 2015, respectively | 2,375 | 2,375 |
Additional paid in capital | 4,532,019 | 4,531,703 |
Cumulative net income | 1,548,097 | 1,477,590 |
Cumulative other comprehensive income (loss) | 7,676 | (32,537) |
Cumulative distributions | (2,804,599) | (2,619,371) |
Total shareholders' equity | 3,285,568 | 3,359,760 |
Total liabilities and shareholders' equity | $ 7,265,767 | $ 7,160,090 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common shares of beneficial interest, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common shares of beneficial interest, shares authorized | 300,000,000 | 300,000,000 |
Common shares of beneficial interest, shares issued | 237,484,059 | 237,471,559 |
Common shares of beneficial interest, shares outstanding | 237,484,059 | 237,471,559 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Revenues: | ||||
Rental income | $ 163,997 | $ 155,546 | $ 325,419 | $ 301,329 |
Residents fees and services | 97,370 | 91,856 | 194,323 | 174,649 |
Total revenues | 261,367 | 247,402 | 519,742 | 475,978 |
Expenses: | ||||
Property operating expenses | 97,474 | 93,592 | 195,422 | 179,386 |
Depreciation and amortization | 71,372 | 62,511 | 142,594 | 116,218 |
General and administrative | 11,965 | 11,674 | 22,828 | 22,248 |
Acquisition related costs | 180 | 4,617 | 619 | 5,775 |
Impairment of assets | 4,961 | 12,351 | ||
Total expenses | 185,952 | 172,394 | 373,814 | 323,627 |
Operating income (loss) | 75,415 | 75,008 | 145,928 | 152,351 |
Dividend income | 789 | 789 | ||
Interest and other income | 177 | 142 | 242 | 217 |
Interest expense | (41,118) | (37,907) | (80,399) | (73,848) |
Loss on early extinguishment of debt | (39) | (6) | (1,448) | |
Income from continuing operations before income tax expense and equity in earnings of an investee | 35,263 | 37,204 | 66,554 | 77,272 |
Income tax expense | (108) | (129) | (202) | (239) |
Equity in earnings of an investee | 17 | 23 | 94 | 95 |
Income (loss) from continuing operations | 35,172 | 37,098 | 66,446 | 77,128 |
Discontinued operations: | ||||
Loss from discontinued operations | (109) | (350) | ||
Impairment of assets from discontinued operations | (602) | (602) | ||
Income before gain on sale of properties | 35,172 | 36,387 | 66,446 | 76,176 |
Gain on sale of properties | 4,061 | 4,061 | ||
Net income (loss) | 39,233 | 36,387 | 70,507 | 76,176 |
Other comprehensive income: | ||||
Unrealized gain on investments in available for sale securities | 15,931 | 1,387 | 40,118 | 2,835 |
Equity in unrealized gain (loss) of an investee | 43 | (64) | 95 | (19) |
Other comprehensive income | 15,974 | 1,323 | 40,213 | 2,816 |
Comprehensive income | $ 55,207 | $ 37,710 | $ 110,720 | $ 78,992 |
Weighted average common shares outstanding (basic) (in shares) | 237,325 | 235,549 | 237,320 | 228,501 |
Weighted average common shares outstanding (diluted) (in shares) | 237,363 | 235,592 | 237,349 | 228,534 |
Per common share amounts (basic and diluted): | ||||
Income from continuing operations (in dollars per share) | $ 0.17 | $ 0.16 | $ 0.30 | $ 0.34 |
Loss from discontinued operations (in dollars per share) | (0.01) | (0.01) | ||
Net income (in dollars per share) | $ 0.17 | $ 0.15 | $ 0.30 | $ 0.33 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) shares in Thousands, $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities: | ||
Net income | $ 70,507 | $ 76,176 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation and amortization | 142,594 | 116,218 |
Amortization of deferred financing fees and debt discounts and premiums | 2,783 | 3,096 |
Straight line rental income | (9,306) | (8,699) |
Amortization of acquired real estate leases and other intangible assets | (2,558) | (2,376) |
Loss on early extinguishment of debt | 6 | 1,448 |
Impairment of assets | 12,351 | 602 |
Gain on sale of properties | (4,061) | |
Gain on sale of investments | (71) | |
Other non-cash adjustments | (1,886) | (510) |
Equity in earnings of an investee | (94) | (95) |
Change in assets and liabilities: | ||
Restricted cash | (871) | 1,423 |
Other assets | 6,202 | (2,803) |
Accrued interest | 1,459 | 1,212 |
Other liabilities | (955) | 30,914 |
Cash provided by operating activities | 216,171 | 216,535 |
Cash flows from investing activities: | ||
Real estate acquisitions and deposits | (187,150) | (1,103,732) |
Real estate improvements | (48,657) | (35,322) |
Investment in The RMR Group Inc | (16,528) | |
Proceeds from sale of properties | 9,279 | 1,750 |
Proceeds from sale of investments | 6,571 | |
Cash used for investing activities | (226,528) | (1,147,261) |
Cash flows from financing activities: | ||
Proceeds from issuance of common shares, net | 659,502 | |
Proceeds from issuance of senior unsecured notes | 250,000 | |
Proceeds from borrowings on revolving credit facility | 340,000 | 1,210,000 |
Repayments of borrowings on revolving credit facility | (366,000) | (675,000) |
Repayment of other debt | (31,788) | (66,431) |
Loss on early extinguishment of debt settled in cash | (1,523) | |
Payment of debt issuance costs | (8,650) | |
Distributions to shareholders | (185,228) | (171,185) |
Cash (used for) provided by financing activities | (1,666) | 955,363 |
Increase in cash and cash equivalents | (12,023) | 24,637 |
Cash and cash equivalents at beginning of period | 37,656 | 27,594 |
Cash and cash equivalents at end of period | 25,633 | 52,231 |
Supplemental cash flow information: | ||
Interest paid | 76,472 | 69,541 |
Income taxes paid | $ 355 | $ 477 |
Non-cash investing activities: | ||
Investment acquired by issuance of common shares | (44,461) | |
Acquisitions funded by assumed debt | $ (169,136) | |
Non-cash financing activities: | ||
Assumption of mortgage notes payable | 169,136 | |
Issuance of common shares | $ 46,503 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2016 | |
Basis of Presentation | |
Basis of Presentation | Note 1. Basis of Presentation The accompanying condensed consolidated financial statements of Senior Housing Properties Trust and its subsidiaries, or we, us, or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2015, or our Annual Report. In the opinion of our management, all adjustments, which include only normal recurring adjustments, considered necessary for a fair presentation have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in our condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets and impairment of real estate and intangible assets. We have made reclassifications to the prior years’ condensed consolidated financial statements to conform to the current year’s presentation. These reclassifications had no effect on net income or shareholders’ equity. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2016 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | Note 2. Recent Accounting Pronouncements On January 1, 2016, we adopted the Financial Accounting Standards Board, or FASB, Accounting Standards Update, or ASU, No. 2015-02, Consolidation . Among other things, this update changed how an entity determines the primary beneficiary of a variable interest entity. The implementation of this update did not have an impact on our condensed consolidated financial statements. On January 1, 2016, we adopted FASB ASU, No. 2015-03, Simplifying the Presentation of Debt Issuance Costs , which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the associated debt liability, and ASU No. 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements – Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting , which addresses the presentation of debt issuance costs related to line of credit arrangements. The implementation of these updates resulted in the reclassification of certain of our capitalized debt issuance costs as an offset to the associated debt liability in our condensed consolidated balance sheets. The classification of capitalized debt issuance costs related to our unsecured revolving credit facility remains unchanged in accordance with ASU No. 2015-15. As of December 31, 2015, debt issuance costs related to our unsecured term loans, senior unsecured notes and secured debt and capital leases of $3,695 , $16,530 and $3,664 , respectively, were reclassified from assets to an offset to the associated debt liability in our condensed consolidated balance sheets. On January 1, 2016, we adopted FASB ASU No. 2015-16, Simplifying the Accounting for Measurement-Period Adjustments , which eliminates the requirement for an acquirer in a business combination to account for measurement period adjustments retrospectively. Instead, acquirers must recognize measurement period adjustments during the period in which they determine the amounts, including the effect on earnings of any amounts they would have recorded in previous periods if the accounting had been completed at the acquisition date. The implementation of this update did not have an impact on our condensed consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities , which changes how entities measure certain equity investments and present changes in the fair value of financial liabilities measured under the fair value option that are attributable to their own credit. This update is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted subject to certain conditions. Currently, changes in fair value of these investments are recorded through other comprehensive income. Under this ASU, these changes will be recorded through earnings. We are continuing to evaluate this guidance, but we expect the implementation of this guidance will affect how changes in the fair value of available for sale equity investments we hold are presented in our condensed consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases , which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU No. 2016-02 requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease. A lessee is also required to record a right of use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales type leases, direct financing leases and operating leases. ASU No. 2016-02 is effective for reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently assessing the potential impact the adoption of ASU No. 2016-02 will have on our condensed consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation , which identifies areas for simplification involving several aspects of accounting for share based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. ASU No. 2016-09 is effective for reporting periods beginning after December 15, 2016. We are currently assessing the potential impact that the adoption of ASU No. 2016-09 will have on our condensed consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires that entities use a new forward looking “expected loss” model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU No. 2016-13 will become effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. We are currently assessing the potential impact that adoption of ASU No. 2016-13 will have on our condensed consolidated financial statements. |
Real Estate Properties
Real Estate Properties | 6 Months Ended |
Jun. 30, 2016 | |
Real Estate Properties | |
Real Estate Properties | Note 3. Real Estate Properties At June 30, 2016, we owned 436 properties ( 462 buildings) located in 43 states and Washington, D.C. We have accounted for, or expect to account for, the following acquisitions as business combinations unless otherwise noted. Acquisitions: The allocation of the purchase prices of the acquisitions shown below are based upon preliminary estimates of the fair value of assets acquired and liabilities assumed. The final amounts allocated to assets acquired and liabilities assumed may differ from the preliminary allocations presented in these condensed consolidated financial statements. Triple Net Leased Senior Living Communities: In June 2016, we acquired seven senior living communities located in four states with 545 private pay units from Five Star Quality Care, Inc., or, together with its subsidiaries, Five Star, for approximately $112,350 , excluding closing costs, and simultaneously entered into a new long term lease with Five Star for those communities. We funded this acquisition using cash on hand and borrowings under our revolving credit facility. See Note 10 for further information regarding this sale and leaseback transaction with Five Star. We accounted for this acquisition as an asset acquisition, and the preliminary allocation of the purchase price was as follows: Cash Paid Number plus Premium of Units / Assumed Buildings and Assumed on Assumed Date Location Properties Beds Debt (1) Land Improvements FF&E Debt Debt Jun-16 4 states 7 $ $ $ $ $ — $ — 7 $ $ $ $ $ — $ — (1) This amount includes the cash we paid as well as various closing settlement adjustments, but excludes closing costs. Managed Senior Living Communities: In May 2016, we acquired one managed senior living community located in Georgia with 38 private pay units for a purchase price of approximately $8,400 , excluding closing costs. We acquired this community using a taxable REIT subsidiary, or TRS, structure and we have entered a management agreement with Five Star to manage this community. We funded this acquisition using cash on hand and borrowings under our revolving credit facility. See Note 10 for further information regarding our management arrangements with Five Star. The preliminary allocation of the purchase price for this acquisition was as follows: Cash Paid Number plus Acquired Premium of Units / Assumed Buildings and Real Estate Assumed on Assumed Date Location Properties Beds Debt (1) Land Improvements FF&E Leases Debt Debt May-16 Georgia 1 $ $ $ $ $ $ — $ — 1 $ $ $ $ $ $ — $ — (1) This amount includes the cash we paid as well as various closing settlement adjustments, but excludes closing costs. MOBs: In February 2016, we acquired one property ( three buildings) leased to medical providers, medical related businesses, clinics and biotech laboratory tenants, or MOBs, located in Minnesota with approximately 128,000 square feet for a purchase price of approximately $22,700 , excluding closing costs. In May 2016, we acquired one MOB ( one building) located in Florida with approximately 166,000 square feet for a purchase price of approximately $45,000 , excluding closing costs. We accounted for the acquisition of this MOB as an asset acquisition. We funded these acquisitions using cash on hand and borrowings under our revolving credit facility. The preliminary allocation of the purchase prices for these acquisitions was as follows: Cash Paid Acquired Number Number plus Acquired Real Estate Premium of of Square Assumed Buildings and Real Estate Lease Assumed on Assumed Date Location Properties Buildings Feet (000’s) Debt (1) Land Improvements Leases (2) Obligations (2) Debt Debt Feb-16 Minnesota 1 3 $ $ $ $ $ $ — $ — May-16 Florida 1 1 — — — — 2 4 $ $ $ $ $ $ — $ — (1) This amount includes the cash we paid as well as various closing settlement adjustments, but excludes closing costs. (2) The weighted average amortization periods for acquired lease intangible assets and assumed real estate lease obligations at the time of these acquisitions was 6.4 years and 7.3 years, respectively. Impairment: We periodically evaluate our assets for impairments. Impairment indicators may include declining tenant or resident occupancy, weak or declining profitability of our properties, decreasing cash flow or liquidity, our decision to dispose of an asset before the end of its estimated useful life, and legislative, market or industry changes that could permanently reduce the value of an asset. If indicators of impairment are present, we evaluate the carrying value of the affected asset by comparing it to the expected future undiscounted net cash flows to be generated from that asset. If the sum of these expected future net cash flows is less than the carrying value, we reduce the net carrying value of the asset to its estimated fair value. During the six months ended June 30, 2016, we recorded the following impairment charges: · $4,391 in the first quarter of 2016 to write off acquired lease intangible assets associated with lease defaults at two of our triple net leased senior living communities leased to two third party private operators. In April 2016, we reached an agreement with one of these tenants and its guarantor to settle past due amounts, terminate the lease and transfer operations. As part of this agreement, we received an amount of $2,365 , and entered into a management agreement with Five Star to operate this community on our behalf under a TRS structure. In July 2016, we reached an agreement with the other tenant to terminate the lease and transfer operations, and we entered into a management agreement with Five Star to operate this community on our behalf under a TRS structure. See Note 10 for further information regarding our management arrangements with Five Star. · $2,999 in the first quarter of 2016 to reduce the carrying values of one MOB (one building) and one land parcel to their estimated sales prices less costs to sell. In March 2016, we sold this land parcel as described further below under “Dispositions”. · $4,961 in the second quarter of 2016 to reduce the carrying values of five MOBs (five buildings) to their estimated sales price less costs to sell. These five MOBs are classified as held for sale as of June 30, 2016. In July 2016, we sold four of these MOBs as described further below under “Dispositions”. Dispositions: In March 2016, we sold a land parcel, which was previously classified as held for sale, for approximately $700 , excluding closing costs. In June 2016, we sold one skilled nursing facility, or SNF, that was previously included in our triple net leased senior living community segment and classified as held for sale for approximately $9,100 , excluding closing costs. We recognized a gain on sale of approximately $4,061 related to this sale. In July 2016, we sold four MOBs (four buildings), which were classified as held for sale at June 30, 2016 for approximately $20,150 , excluding closing costs. Results of operations for properties sold or held for sale are only included in discontinued operations in our condensed consolidated statements of comprehensive income when the criteria for discontinued operations in the Presentation of Financial Statements Topic of the FASB Accounting Standards Codification are met. The senior living communities and MOBs which we are or were offering for sale during the periods presented did not meet the criteria for discontinued operations and are included in continuing operations. |
Investments in Available for Sa
Investments in Available for Sale Securities | 6 Months Ended |
Jun. 30, 2016 | |
Investments in Available for Sale Securities | |
Investments in Available for Sale Securities | Note 4. Investments in Available for Sale Securities As of June 30, 2016, we owned 4,235,000 common shares of Five Star. We classify these shares as available for sale securities and carry them at fair market value in other assets in our condensed consolidated balance sheets, with unrealized gains and losses reported as a component of shareholders’ equity. Our historical cost basis for these shares is $14,230 . At June 30, 2016, our investment in Five Star had a fair value of $9,910 , resulting in a cumulative unrealized loss of $4,320 based on Five Star’s quoted share price at June 30, 2016 ( $2.34 per share). In addition, at June 30, 2016, we owned 2,637,408 shares of class A common stock of The RMR Group Inc., or RMR Inc. We also classify these shares of RMR Inc. as available for sale securities and carry them at fair value in other assets in our condensed consolidated balance sheets, with unrealized gains and losses reported as a component of shareholders’ equity. Our historical cost basis for these shares is $69,826 . At June 30, 2016, our investment in RMR Inc. had a fair value of $81,681 , resulting in a cumulative unrealized gain of $11,855 based on RMR Inc.’s quoted share price at June 30, 2016 ( $30.97 per share). See Notes 7 and 10 below for further information regarding our investments in available for sale securities. |
Indebtedness
Indebtedness | 6 Months Ended |
Jun. 30, 2016 | |
Indebtedness | |
Indebtedness | Note 5. Indebtedness Our principal debt obligations at June 30, 2016 were: (1) outstanding borrowings under our $1 ,000,000 unsecured revolving credit facility; (2) six public issuances of senior unsecured notes, including: (a) $400,000 principal amount at an annual interest rate of 3.25% due 2019, (b) $200,000 principal amount at an annual interest rate of 6.75% due 2020, (c) $300,000 principal amount at an annual interest rate of 6.75% due 2021, (d) $250,000 principal amount at an annual interest rate of 4.75% due 2024, (e) $350,000 principal amount at an annual interest rate of 5.625% due 2042 and (f) $250,000 principal amount at an annual interest rate of 6.25% due 2046; (3) our $350,000 principal amount term loan due 2020; (4) our $ 200,000 principal amount term loan due 2022; and (5) $636,087 aggregate principal amount of mortgages (excluding premiums, discounts and net debt issuance costs) secured by 54 of our properties ( 55 buildings) with maturity dates between 2016 and 2043. The 5 4 mortgaged properties (55 buildings) had a carrying value (before accumulated depreciation) of $1,040,792 at June 30, 2016. We also had two properties subject to capital leases with lease obligations totaling $ 11,817 at June 30, 2016; these two properties had a carrying value (before accumulated depreciation) of $36,039 at June 30, 2016, and the capital leases expire in 2026. In February 2016, we issued $250,000 of 6.25% senior unsecured notes due 2046, and raised net proceeds of approximately $241,350 after underwriting discounts and expenses. We used the net proceeds of this offering to repay in part the outstanding amount under our revolving credit facility and for general business purposes. In July 2016, we entered into loan agreements and obtained an aggregate $620,000 secured debt financing that matures in August 2026. These loans are secured by one MOB (two buildings) located in Massachusetts and require interest at a weighted average fixed annual interest rate of 3.53% . We used the net proceeds from these loans to repay in part the outstanding amount under our revolving credit facility and for general business purposes. The loan agreements contain customary covenants and provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default. We have a $1 ,000,000 revolving credit facility that is available for general business purposes, including acquisitions. The maturity date of our revolving credit facility is January 15, 2018 and, subject to our payment of an extension fee and meeting other conditions, we have an option to extend the stated maturity date by an additional year to January 15, 2019. Our revolving credit facility provides that we can borrow, repay and re-borrow funds available under our revolving credit facility until maturity, and no principal repayment is due until maturity. Our revolving credit facility requires annual interest to be paid on borrowings at LIBOR plus a premium, which was 130 basis points as of June 30, 2016, plus a facility fee of 30 basis points per annum on the total amount of lending commitments. Both the interest rate premium and the facility fee are subject to adjustment based upon changes to our credit ratings. As of June 30, 2016, the annual interest rate payable on borrowings under our revolving credit facility was 1.7% . The weighted average annual interest rates for borrowings under our revolving credit facility were 1.7% and 1.5% for the three months ended June 30, 2016 and 2015, respectively, and 1.7% and 1.5% for the six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, we had $749,000 outstanding and $251,000 available for borrowing, and as of August 4, 2016, we had $100,000 outstanding and $900,000 available for borrowing under our revolving credit facility. We incurred interest expense and other associated costs related to our revolving credit facility of $3,454 and $ 2,063 for the three months ended June 30, 2016 and 2015, respectively. We incurred interest expense and other associated costs related to our revolving credit facility of $7,136 and $3,003 for the six months ended June 30, 2016 and 2015, respectively. Our revolving credit facility includes an accordion feature pursuant to which maximum borrowings under the facility may be increased to up to $1,500,000 in certain circumstances. We have a $200,000 term loan, which we borrowed in 2015. This term loan matures in September 2022 and is prepayable without penalty beginning September 29, 2017. This term loan requires annual interest to be paid at LIBOR plus a premium of 180 basis points that is subject to adjustment based upon changes to our credit ratings. As of June 30, 2016, the annual interest rate payable for amounts outstanding under this term loan was 2.3% . The weighted average annual interest rate for amounts outstanding under this term loan was 2.3% for both the three and six months ended June 30, 2016. We incurred interest expense and other associated costs related to this term loan of $1,133 and $2,260 for the three and six months ended June 30, 2016, respectively. This term loan includes an accordion feature under which maximum borrowings may be increased to up to $400,000 in certain circumstances. We also have a $350,000 term loan, which we borrowed in 2014. This term loan matures in January 2020 and is prepayable without penalty at any time. This term loan requires annual interest to be paid at LIBOR plus a premium of 140 basis points that is subject to adjustment based upon changes to our credit ratings. As of June 30, 2016, the annual interest rate payable on amounts outstanding under this term loan was 1.9% . The weighted average annual interest rate for amounts outstanding under this term loan was 1.9% and 1.6% for the three months ended June 30, 2016 and 2015, respectively, and 1.9% and 1.6% for the six months ended June 30, 2016 and 2015, respectively. We incurred interest expense and other associated costs related to this term loan of $1,635 and $1,449 for three months ended June 30, 2016 and 2015, respectively. We incurred interest expense and other associated costs related to this term loan of $3,249 and $2,823 for six months ended June 30, 2016 and 2015, respectively. This term loan includes an accordion feature under which maximum borrowings may be increased to up to $700,000 in certain circumstances. Our revolving credit facility and term loan agreements and our senior unsecured notes indentures and their supplements provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default, such as, in the case of our revolving credit facility and term loan agreements, a change of control of us, which includes The RMR Group LLC, or RMR LLC, ceasing to act as our business manager and property manager. Our revolving credit facility and term loan agreements and our senior unsecured notes indentures and their supplements also contain a number of covenants, including covenants that restrict our ability to incur debts, and generally require us to maintain certain financial ratios, and our revolving credit facility and term loan agreements restrict our ability to make distributions under certain circumstances. We believe we were in compliance with the terms and conditions of the respective covenants under our revolving credit facility and term loan agreements and our senior unsecured notes indentures and their supplements at June 30, 2016. In January 2016, we prepaid, at par plus accrued interest, a $6,115 mortgage note secured by one of our properties with a maturity date in April 2016 and an annual interest rate of 5.97% . In April 2016, we prepaid, at par plus accrued interest, an $18,000 mortgage note secured by one of our properties with a maturity date in July 2016 and an annual interest rate of 4.65% . In July 2016, we prepaid, at par plus accrued interest, an $11,871 mortgage note secured by one of our properties with a maturity date in November 2016 and an annual interest rate of 6.25% . Also in July 2016, we gave notice of our intention to prepay, at par plus accrued interest, two mortgage notes secured by two of our properties with an aggregate principal balance of approximately $79,957 , maturity dates in November 2016 and a weighted average annual interest rate of 5.92% ; we ex pect to make these prepayments in September 2016 . |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 30, 2016 | |
Shareholders' Equity | |
Shareholders' Equity | Note 6. Shareholders’ Equity On February 23, 2016, we paid a regular quarterly distribution to common shareholders of $0.39 per share, or approximately $92,614 , that was declared on January 11, 2016 and was payable to shareholders of record on January 22, 2016. On May 19, 2016, we paid a regular quarterly distribution to common shareholders of $0.39 per share, or approximately $92,614 , that was declared on April 13, 2016 and was payable to shareholders of record on April 25, 2016. On July 12, 2016, we declared a regular quarterly distribution payable to common shareholders of record on July 22, 2016 of $0.39 per share, or approximately $92,619 . We expect to pay this distribution on or about August 18, 2016. |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value of Assets and Liabilities | |
Fair Value of Assets and Liabilities | Note 7. Fair Value of Assets and Liabilities The table below presents certain of our assets measured at fair value at June 30, 2016, categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset: Significant Total as of Quoted Prices in Active Significant Other Unobservable June 30, Markets for Identical Observable Inputs Inputs Description 2016 Assets (Level 1) (Level 2) (Level 3) Recurring Fair Value Measurements Assets: Investments in available for sale securities (1) $ $ $ — $ — Non-Recurring Fair Value Measurements Assets: Assets held for sale (2) $ $ — $ — $ (1) Our investments in available for sale securities include our 4,235,000 common shares of Five Star and our 2,637,408 shares of RMR Inc. class A common stock. The fair values of these shares are based upon quoted prices at June 30, 2016 in active markets (Level 1 inputs). Our historical cost basis for our Five Star and RMR Inc. shares is $14,230 and $69,826 , respectively, as of June 30, 2016. The unrealized loss of $4,320 for our Five Star shares and the unrealized gain of $11,855 for our RMR Inc. shares as of June 30, 2016 are included in cumulative other comprehensive income (loss) in our condensed consolidated balance sheets. We evaluated the decline in the fair value of the Five Star shares and determined that based on the severity and duration of the decline, and our ability and intent to hold these investments for a reasonable period of time sufficient for a forecasted recovery of fair value, we do not consider these investments to be other-than-temporarily impaired at June 30, 2016. (2) Assets held for sale consist of five MOBs held for sale as of June 30, 2016. These MOBs are recorded at their estimated fair values less costs to sell. We used offers from third parties to purchase these properties and knowledge of local real estate markets to determine their fair values as of June 30, 2016. In addition to the assets described in the table above, our financial instruments at June 30, 2016 and December 31, 2015 included cash and cash equivalents, restricted cash, other assets, our revolving credit facility, term loans, senior unsecured notes, secured debt and capital leases and other unsecured obligations and liabilities. The fair values of these financial instruments approximated their carrying values in our condensed consolidated financial statements as of such dates, except as follows: As of June 30, 2016 As of December 31, 2015 Description Carrying Amount (1) Estimated Fair Value Carrying Amount (1) Estimated Fair Value Senior unsecured notes $ $ $ $ Secured debt and capital leases (2) $ $ $ $ (1) Includes unamortized debt issuance costs, premiums and discounts. (2) We assumed certain of these secured debts in connection with our acquisitions of certain properties. We recorded the assumed mortgage debts at estimated fair value on the date of acquisition and we are amortizing the fair value adjustments, if any, to interest expense over the respective terms of the mortgage debts to reduce interest expense to the estimated market interest rates as of the date of acquisition. We estimate the fair values of our senior unsecured notes using an average of the bid and ask price of our outstanding six issuances of senior unsecured notes (Level 2 inputs as defined in the fair value hierarchy under GAAP) on or about June 30, 2016. We estimate the fair values of our secured debts by using discounted cash flow analyses and currently prevailing market terms as of the measurement date (Level 3 inputs as defined as defined in the fair value hierarchy under GAAP). Because Level 3 inputs are unobservable, our estimated fair value may differ materially from the actual fair value. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2016 | |
Segment Reporting | |
Segment Reporting | Note 8. Segment Reporting As of June 30, 2016, we have four operating segments, of which three are separate reporting segments. The first reporting segment includes triple net senior living communities that provide short term and long term residential care and other services for residents. The second reporting segment includes managed senior living communities that provide short term and long term residential care and other services for residents. The third reporting segment includes MOBs. Our fourth segment includes the remainder of our operations, including certain properties that offer wellness, fitness and spa services to members, which we do not consider to be sufficiently material to constitute a separate reporting segment, and all of our other operations. For the Three Months Ended June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Impairment of assets — — — Total expenses Operating income (loss) Dividend income — — — Interest and other income — — — Interest expense Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) before gain on sale of properties $ $ $ $ $ Gain on sale of properties — — — Net income (loss) $ $ $ $ As of June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ For the Three Months Ended June 30, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Total expenses Operating income (loss) Interest and other income — — — Interest expense Loss on early extinguishment of debt — — Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) from continuing operations Discontinued operations: Loss from discontinued operations — — — Impairment of assets from discontinued operations — — — Net income (loss) $ $ $ $ $ As of December 31, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ For the Six Months Ended June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Impairment of assets — — Total expenses Operating income (loss) Dividend income — — — Interest and other income — — — Interest expense Loss on early extinguishment of debt — — — Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) before gain on sale of properties Gain on sale of properties — — — Net income (loss) $ $ $ $ $ As of June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ For the Six Months Ended June 30, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Total expenses Operating income (loss) Interest and other income — — — Interest expense Loss on early extinguishment of debt — Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) from continuing operations Discontinued operations: Loss from discontinued operations — — — Impairment of assets from discontinued operations — — — Net income (loss) $ $ $ $ $ As of December 31, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ |
Significant Tenant
Significant Tenant | 6 Months Ended |
Jun. 30, 2016 | |
Significant Tenant | |
Significant Tenant | Note 9. Significant Tenant Five Star is our most significant tenant. Rental income from Five Star represented 18.5% of our total revenues for the six months ended June 30, 2016, and the properties Five Star leases from us represented 29.7% of our total investments, at cost, as of June 30, 2016. As of June 30, 2016, Five Star also managed 62 senior living communities for our account. See Note 10 for further information relating to our leases and management arrangements with Five Star. |
Related Person Transactions
Related Person Transactions | 6 Months Ended |
Jun. 30, 2016 | |
Related Person Transactions | |
Related Person Transactions | Note 10. Related Person Transactions We have relationships and historical and continuing transactions with Five Star, RMR LLC and others related to them, including other companies to which RMR LLC provides management services and which have trustees, directors and officers who are also our trustees or officers. For further information about these and other such relationships and certain other related person transactions, please refer to our Annual Report. Five Star : Five Star was our 100% owned subsidiary until we distributed its common shares to our shareholders in 2001. We are Five Star’s largest stockholder. As of June 30, 2016, we owned 4,235,000 of Five Star’s common shares, representing approximately 8.6% of Five Star’s outstanding common shares. Five Star is our largest tenant and a manager of certain of our senior living communities. Our investment in Five Star common shares, which is included in other assets in our condensed consolidated balance sheets, is recorded at fair value, with the related unrealized gain (loss) included in cumulative other comprehensive income (loss) in our condensed consolidated balance sheets. We recognize the increase or decrease in the fair value of our Five Star common shares each reporting period as unrealized gain or loss on investment in available for sale securities which is a component of other comprehensive income (loss) in our condensed consolidated statements of comprehensive income. For further information, see Notes 4 and 7. On June 29, 2016, we entered into a transaction agreement, or the Transaction Agreement, and related agreements, or, collectively, the Transaction Documents, with Five Star. Pursuant to the Transaction Documents, among other things, on June 29, 2016, we and Five Star completed a sale and leaseback transaction with respect to certain senior living communities owned by Five Star and amended the pooling arrangements related to Five Star’s management of certain senior living communities we own. Significant terms of the Transaction Documents are summarized below. · Pursuant to the Transaction Agreement, we and Five Star entered into a purchase and sale agreement whereby we purchased seven senior living communities from Five Star for an aggregate purchase price of $112,350 , and we and Five Star simultaneously entered into a new long term lease agreement, or the New Lease, whereby we have leased those seven senior living communities to Five Star. · Pursuant to the New Lease, Five Star is required to pay initial annual rent of $8,426 , plus, beginning in 2018, percentage rent equal to 4% of the amount by which gross revenues, as defined in the New Lease, of each community exceeds gross revenues of such community in 2017. The initial term of the New Lease expires on December 31, 2028 and Five Star has options to extend the term of the New Lease for two consecutive 15 -year terms. Pursuant to the New Lease, Five Star may request that we purchase certain improvements to the communities in return for rent increases in accordance with the formula specified in the New Lease; however, we are not obligated to purchase such improvements and Five Star is not required to sell them to us. Pursuant to the Transaction Agreement, we have the right, in connection with a financing or other capital raising transaction, to reassign one or more of the communities covered by the New Lease to another existing or new long term lease agreement between us and Five Star. Other terms of the New Lease are substantially similar to those of our other four preexisting long term leases with Five Star, such terms being described in our Annual Report, which descriptions are incorporated herein by reference. · Pursuant to the Transaction Agreement, our three existing pooling agreements with Five Star that combined for certain purposes certain of our management agreements with Five Star for senior living communities that include assisted living units, or AL Management Agreements, were terminated. Also pursuant to the Transaction Agreement, we entered into 10 new pooling agreements with Five Star, or the New Pooling Agreements. Nine of the New Pooling Agreements combine six AL Management Agreements and one of the New Pooling Agreements currently combines five AL Management Agreements. Each New Pooling Agreement combines various calculations of revenues and expenses from the operations of the applicable communities covered by such New Pooling Agreement. · Pursuant to the New Pooling Agreements, the AL Management Agreements covered by each New Pooling Agreement generally provide Five Star with a management fee equal to either 3% or 5% of the gross revenues realized at such communities plus reimbursement for its direct costs and expenses related to such communities, as well as an annual incentive fee equal to either 35% or 20% of the annual net operating income of such communities remaining after we realize an annual minimum return equal to either 8% or 7% of our invested capital, or, in the case of nine communities, a specified amount plus 7% of our invested capital since December 31, 2015. The calculations of Five Star’s fees and of our annual minimum return related to any AL Management Agreement that became effective before May 2015 and had been pooled under one of the previously existing pooling agreements are generally the same as they were under the previously existing pooling agreements. However, with respect to certain communities, our annual minimum return was reduced to 7% , and also, with respect to the nine communities referenced above, our annual minimum return was reset as of 2016 to the specified amounts. With regard to AL Management Agreements that became effective from and after May 2015, the management fee was changed to 5%, rather than the prior 3%, of the gross revenues realized at the applicable community, and the incentive fee was changed to 20%, rather than the prior 35%, of the annual net operating income of the applicable community remaining, in all cases after we realize our requisite annual minimum return. Pursuant to the New Pooling Agreements, we will pay Five Star a fee for its management of capital expenditure projects equal to 3% of amounts funded by us. · The terms of the AL Management Agreements covered by the New Pooling Agreements expire between 2030 and 2039 and are subject to automatic renewals, unless earlier terminated or timely notices of nonrenewal are delivered. The right that we and Five Star each had under the AL Management Agreements that became effective from and after May 1, 2015 to terminate each such AL Management Agreement as of December 31, 2016 was eliminated pursuant to the applicable New Pooling Agreement. Five Star has a limited right under the AL Management Agreements to require underperforming communities to be sold, and we have the right to terminate all the AL Management Agreements subject to a New Pooling Agreement if we do not receive our annual minimum return under such New Pooling Agreement in each of three consecutive years, commencing with calendar year 2016, subject to certain Five Star cure rights. · The New Pooling Agreements collectively combine all AL Management Agreements except for the management agreement related to one assisted living community located in New York and the management agreement related to one assisted living community located in California, and, other than as described below, the terms of those management agreements were not amended as part of the transactions contemplated by the Transaction Documents. The terms of our existing pooling agreement with Five Star that combines our management agreements with Five Star for senior living communities that include only independent living units, and the terms of those management agreements, also were not amended as part of the transactions contemplated by the Transaction Documents. · Pursuant to the Transaction Agreement, we and Five Star amended the management agreement for one California community so that the calculation of our annual minimum return under that agreement is fixed at $3,610 plus 7% of any amount funded by us for capital expenditures at this community since December 31, 2015. Because of the continuing relationships between us and Five Star, the terms of the Transaction Documents were negotiated and approved by special committees of our Board of Trustees and Five Star’s board of directors composed of our Independent Trustees and Five Star’s independent directors who are not also Trustees or directors of the other party, which committees were represented by separate counsel. As of June 30, 2016 and 2015, we leased 184 and 180 senior living communities to Five Star, respectively. We recognized total rental income from Five Star of $48,234 and $47,753 for the three months ended June 30, 2016 and 2015, respectively, and $96,341 and $95,443 for the six months ended June 30, 2016 and 2015, respectively. These amounts exclude estimated percentage rent payments we received from Five Star of $1,388 and $1,393 for the three months ended June 30, 2016 and 2015, respectively, and $2,861 and $2,824 for the six months ended June 30, 2016 and 2015, respectively. We determine actual percentage rent due under our Five Star leases annually and recognize any resulting amount as rental income at year end when all contingencies are met. As of June 30, 2016 and December 31, 2015, we had rents receivable from Five Star of $16,065 and $17,466 , respectively. Those amounts are included in other assets in our condensed consolidated balance sheets. During the six months ended June 30, 2016 and 2015, pursuant to the terms of our leases with Five Star, we purchased $11,836 and $8,902 , respectively, of improvements to properties leased to Five Star, and, as a result, the annual rent payable to us by Five Star increased by approximately $949 and $717 , respectively. In April 2016, Five Star began managing a senior living community we own located in North Carolina with 87 living units where the prior tenant had defaulted on its lease. In May 2016, Five Star began managing a senior living community located in Georgia with 38 private pay units that we acquired in May 2016 for a purchase price of approximately $8,400 , excluding closing costs. We acquired this community using a TRS structure. In July 2016, Five Star began managing an additional senior living community we own located in Alabama with 163 living units where the prior tenant had defaulted on its lease. The terms by which Five Star is managing these senior living communities are described above. As of June 30, 2016 and 2015, Five Star managed 62 and 60 senior living communities for our account, respectively. We incurred management fees payable to Five Star of $ 2,819 and $2,699 for the three months ended June 30, 2016 and 2015, respectively, and $5,623 and $5,222 for the six months ended June 30, 2016 and 2015, respectively. These amounts are included in property operating expenses in our condensed consolidated statements of comprehensive income. D&R Yonkers LLC: In order to accommodate certain requirements of New York licensing laws, one of our TRSs subleases a part of a senior living community we own that is managed by Five Star to D&R Yonkers LLC. D&R Yonkers LLC is owned by our President and Chief Operating Officer and Five Star’s chief financial officer and treasurer. Our transactions and balances with D&R Yonkers LLC are eliminated upon consolidation for accounting purposes and are not separately stated and do not appear in our condensed consolidated financial statements. RMR LLC: Pursuant to our business management agreement with RMR LLC, we recognized net business management fees of $9,243 and $9,144 for the three months ended June 30, 2016 and 2015, respectively, and $17,590 and $18,014 for the six months ended June 30, 2016 and 2015, respectively. No incentive fees were estimated to be payable to RMR LLC for the three or six months ended June 30, 2016 and 2015, respectively. The net business management fees we recognized for the 2016 and 2015 periods are included in general and administrative expenses in our condensed consolidated statements of comprehensive income. In accordance with the terms of our business management agreement, we issued 68,983 of our common shares to RMR LLC for the period from January 1, 2015 through May 31, 2015 as payment for a part of the business management fee we recognized for that period. Beginning June 1, 2015, all management fees under our business management agreement are paid in cash. Pursuant to our property management agreement with RMR LLC, we recognized aggregate net property management and construction supervision fees of $2,686 and $2,532 for the three months ended June 30, 2016 and 2015, respectively, and $5,232 and $4,969 for the six months ended June 30, 2016 and 2015, respectively. These amounts are included in property operating expenses or have been capitalized, as appropriate, in our condensed consolidated financial statements. We are generally responsible for all of our operating expenses, including certain expenses incurred by RMR LLC on our behalf. Our property level operating expenses are generally incorporated into rents charged to our tenants, including certain payroll and related costs incurred by RMR LLC. We reimbursed RMR LLC $2,171 and $1,494 for property management related expenses for the three months ended June 30, 2016 and 2015, respectively, and $4,299 and $3,235 for the six months ended June 30, 2016 and 2015, respectively. These amounts are included in property operating expenses in our condensed consolidated statements of comprehensive income. We have historically awarded share grants to certain RMR LLC employees under our equity compensation plans. In addition, under our business management agreement we reimburse RMR LLC for our allocable costs for internal audit services. The amounts recognized as expense for share grants to RMR LLC employees and internal audit costs were $589 and $316 for the three months ended June 30, 2016 and 2015, respectively, and $1,174 and $777 for the six months ended June 30, 2016 and 2015, respectively. These amounts are included in general and administrative expenses in our condensed consolidated statements of comprehensive income. We lease office space to RMR LLC in certain of our properties for its property management offices. Pursuant to our lease agreements with RMR LLC, we recognized rental income from RMR LLC for leased office space of $61 and $171 for the three and six months ended June 30, 2016, respectively. We recognized rental income from RMR LLC for leased office space of $102 for the six months ended June 30, 2015, $51 of which related to rental income from the first three months of 2015. RMR Inc.: In connection with our June 2015 acquisition of shares of class A common stock of RMR Inc., we recorded a liability for the amount by which the estimated fair value of these shares exceeded the price we paid for these shares. This liability is included in accounts payable and other liabilities in our condensed consolidated balance sheets. A part of this liability is being amortized on a straight line basis through December 31, 2035 as an allocated reduction to our business management and property management fee expense. We amortized $943 and $1,886 of this liability, respectively, for the three and six months ended June 30, 2016, and $243 of this liability for both the three and six months ended June 30, 2015. These amounts are included in the net business management and property management fee amounts for such periods. As of June 30, 2016, the remaining unamortized amount of this liability was $73,819 . As of June 30, 2016, we owned 2,637,408 shares of class A common stock of RMR Inc. We receive dividends on our RMR Inc. class A common shares as declared and paid by RMR Inc. to all holders of its class A common shares. We received a dividend of $789 on our RMR Inc. class A common shares during the three months ended June 30, 2016, which was for the period from December 14, 2015 through March 31, 2016. Since then, we have not yet received any other dividends on our RMR Inc. class A common shares. On July 12, 2016, RMR Inc. declared a regular quarterly dividend of $0.25 per class A common share payable to shareholders of record on July 22, 2016. RMR Inc. has stated that it expects to pay this dividend on or about August 18, 2016. Our investment in RMR Inc. class A common shares, which is included in other assets in our condensed consolidated balance sheets, is recorded at fair value, with the related unrealized gain (loss) included in cumulative other comprehensive income (loss) in our condensed consolidated balance sheets. We recognize the increase or decrease in the fair value of our RMR Inc. class A common shares each reporting period as unrealized gain or loss on investment in available for sale securities which is a component of other comprehensive income (loss) in our condensed consolidated statements of comprehensive income. For further information, see Notes 4 and 7. AIC: We and six other companies to which RMR LLC provides management services each own Affiliates Insurance Company, or AIC, in equal amounts. We and the other AIC shareholders participate in a combined property insurance program arranged and reinsured in part by AIC; as part of this program, in June 2016, we renewed our one year standalone insurance policy through June 30, 2017, that provides coverage for one very large property we own. We currently expect to pay aggregate annual premiums, including taxes and fees, of approximately $3,607 in connection with this insurance program for the policy year ending June 30, 2017, which amount may be adjusted from time to time as we acquire and dispose of properties that are included in this insurance program. As of June 30, 2016 and December 31, 2015, our investment in AIC had a carrying value of $7,016 and $6,827 , respectively . These amounts are included in other assets in our condensed consolidated balance sheets. We recognized income of $17 and $23 related to our investment in AIC for the three months ended June 30, 2016 and 2015, respectively, and $94 and $95 for the six months ended June 30, 2016 and 2015, respectively. Our other comprehensive income includes our proportionate part of unrealized gains (loss) on securities which are owned by AIC of $43 and ($64) for the three months ended June 30, 2016 and 2015, respectively, and $95 and ($19) for the six months ended June 30, 2016 and 2015, respectively. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2016 | |
Income Taxes | |
Income Taxes | Note 11. Income Taxes We have elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, and as such, are generally not subject to federal and most state income taxation on our operating income provided we distribute our taxable income to our shareholders and meet certain organization and operating requirements. We do, however, lease certain managed senior living communities to our wholly owned TRSs that, unlike most of our subsidiaries, file a separate consolidated federal corporate income tax return and are subject to federal and state income taxes. Our consolidated income tax provision includes the income tax provision related to the operations of our TRSs and certain state income taxes we incur despite our taxation as a REIT. During the three months ended June 30, 2016 and 2015, we recognized income tax expense of $108 and $129 , respectively. During the six months ended June 30, 2016 and 2015, we recognized income tax expense of $202 and $239 , respectively. |
Weighted Average Common Shares
Weighted Average Common Shares | 6 Months Ended |
Jun. 30, 2016 | |
Weighted Average Common Shares | |
Weighted Average Common Shares | Note 12. Weighted Average Common Shares The following table provides a reconciliation of the weighted average number of common shares used in the calculation of basic and diluted earnings per share (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Weighted average common shares for basic earnings per share Effect of dilutive securities: unvested share awards Weighted average common shares for diluted earnings per share |
Real Estate Properties (Tables)
Real Estate Properties (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
MOBs | |
Real Estate Properties | |
Schedule of real estate property acquisition | Cash Paid Acquired Number Number plus Acquired Real Estate Premium of of Square Assumed Buildings and Real Estate Lease Assumed on Assumed Date Location Properties Buildings Feet (000’s) Debt (1) Land Improvements Leases (2) Obligations (2) Debt Debt Feb-16 Minnesota 1 3 $ $ $ $ $ $ — $ — May-16 Florida 1 1 — — — — 2 4 $ $ $ $ $ $ — $ — (1) This amount includes the cash we paid as well as various closing settlement adjustments, but excludes closing costs. (2) The weighted average amortization periods for acquired lease intangible assets and assumed real estate lease obligations at the time of these acquisitions was 6.4 years and 7.3 years, respectively. |
Triple Net Leased Senior Living Communities | |
Real Estate Properties | |
Schedule of real estate property acquisition | Cash Paid Number plus Premium of Units / Assumed Buildings and Assumed on Assumed Date Location Properties Beds Debt (1) Land Improvements FF&E Debt Debt Jun-16 4 states 7 $ $ $ $ $ — $ — 7 $ $ $ $ $ — $ — This amount includes the cash we paid as well as various closing settlement adjustments, but excludes closing costs. |
Managed Senior Living Communities | |
Real Estate Properties | |
Schedule of real estate property acquisition | Cash Paid Number plus Acquired Premium of Units / Assumed Buildings and Real Estate Assumed on Assumed Date Location Properties Beds Debt (1) Land Improvements FF&E Leases Debt Debt May-16 Georgia 1 $ $ $ $ $ $ — $ — 1 $ $ $ $ $ $ — $ — This amount includes the cash we paid as well as various closing settlement adjustments, but excludes closing costs. |
Fair Value of Assets and Liab19
Fair Value of Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value of Assets and Liabilities | |
Assets and liabilities recurring and nonrecurring measured at fair value | Significant Total as of Quoted Prices in Active Significant Other Unobservable June 30, Markets for Identical Observable Inputs Inputs Description 2016 Assets (Level 1) (Level 2) (Level 3) Recurring Fair Value Measurements Assets: Investments in available for sale securities (1) $ $ $ — $ — Non-Recurring Fair Value Measurements Assets: Assets held for sale (2) $ $ — $ — $ (1) Our investments in available for sale securities include our 4,235,000 common shares of Five Star and our 2,637,408 shares of RMR Inc. class A common stock. The fair values of these shares are based upon quoted prices at June 30, 2016 in active markets (Level 1 inputs). Our historical cost basis for our Five Star and RMR Inc. shares is $14,230 and $69,826 , respectively, as of June 30, 2016. The unrealized loss of $4,320 for our Five Star shares and the unrealized gain of $11,855 for our RMR Inc. shares as of June 30, 2016 are included in cumulative other comprehensive income (loss) in our condensed consolidated balance sheets. We evaluated the decline in the fair value of the Five Star shares and determined that based on the severity and duration of the decline, and our ability and intent to hold these investments for a reasonable period of time sufficient for a forecasted recovery of fair value, we do not consider these investments to be other-than-temporarily impaired at June 30, 2016. Assets held for sale consist of five MOBs held for sale as of June 30, 2016. These MOBs are recorded at their estimated fair values less costs to sell. We used offers from third parties to purchase these properties and knowledge of local real estate markets to determine their fair values as of June 30, 2016. |
Schedule of carrying value and fair value of the financial instruments | As of June 30, 2016 As of December 31, 2015 Description Carrying Amount (1) Estimated Fair Value Carrying Amount (1) Estimated Fair Value Senior unsecured notes $ $ $ $ Secured debt and capital leases (2) $ $ $ $ (1) Includes unamortized debt issuance costs, premiums and discounts. (2) We assumed certain of these secured debts in connection with our acquisitions of certain properties. We recorded the assumed mortgage debts at estimated fair value on the date of acquisition and we are amortizing the fair value adjustments, if any, to interest expense over the respective terms of the mortgage debts to reduce interest expense to the estimated market interest rates as of the date of acquisition. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Segment Reporting | |
Schedule of segment reporting information | For the Three Months Ended June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Impairment of assets — — — Total expenses Operating income (loss) Dividend income — — — Interest and other income — — — Interest expense Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) before gain on sale of properties $ $ $ $ $ Gain on sale of properties — — — Net income (loss) $ $ $ $ As of June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ For the Three Months Ended June 30, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Total expenses Operating income (loss) Interest and other income — — — Interest expense Loss on early extinguishment of debt — — Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) from continuing operations Discontinued operations: Loss from discontinued operations — — — Impairment of assets from discontinued operations — — — Net income (loss) $ $ $ $ $ As of December 31, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ For the Six Months Ended June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Impairment of assets — — Total expenses Operating income (loss) Dividend income — — — Interest and other income — — — Interest expense Loss on early extinguishment of debt — — — Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) before gain on sale of properties Gain on sale of properties — — — Net income (loss) $ $ $ $ $ As of June 30, 2016 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ For the Six Months Ended June 30, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Revenues: Rental income $ $ — $ $ $ Residents fees and services — — — Total revenues Expenses: Property operating expenses — — Depreciation and amortization General and administrative — — — Acquisition related costs — — — Total expenses Operating income (loss) Interest and other income — — — Interest expense Loss on early extinguishment of debt — Income (loss) from continuing operations before income tax expense and equity in earnings of an investee Income tax expense — — — Equity in earnings of an investee — — — Income (loss) from continuing operations Discontinued operations: Loss from discontinued operations — — — Impairment of assets from discontinued operations — — — Net income (loss) $ $ $ $ $ As of December 31, 2015 Triple Net Leased Managed Senior Living Senior Living All Other Communities Communities MOBs Operations Consolidated Total assets $ $ $ $ $ |
Weighted Average Common Shares
Weighted Average Common Shares (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Weighted Average Common Shares | |
Schedule of Weighted Average Number of Shares | Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Weighted average common shares for basic earnings per share Effect of dilutive securities: unvested share awards Weighted average common shares for diluted earnings per share |
Recent Accounting Pronounceme22
Recent Accounting Pronouncements (Details) - Adjustment - ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs $ in Thousands | Dec. 31, 2015USD ($) |
Unsecured term loan | |
Deferred financing fees, net | $ 3,695 |
Senior unsecured notes | |
Deferred financing fees, net | 16,530 |
Secured debt and capital lease | |
Deferred financing fees, net | $ 3,664 |
Real Estate Properties (Details
Real Estate Properties (Details) $ in Thousands | Jun. 29, 2016USD ($)agreementcommunity | Jul. 31, 2016building | Jun. 30, 2016USD ($)ft²statebuildingitemproperty | May 31, 2016USD ($)ft²buildingproperty | Feb. 29, 2016USD ($)ft²buildingproperty | Mar. 31, 2016community | Jun. 30, 2016USD ($)ft²statebuildingitemproperty | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($) |
Real Estate Properties | |||||||||
Number of properties owned | property | 436 | 436 | |||||||
Number of buildings owned | building | 462 | 462 | |||||||
Number of states in which properties are located | item | 43 | 43 | |||||||
Land | $ 798,603 | $ 798,603 | $ 781,426 | ||||||
Assumption of mortgage notes payable | $ 169,136 | ||||||||
Triple Net Leased Senior Living Communities | |||||||||
Real Estate Properties | |||||||||
Number of communities | community | 2 | ||||||||
Senior Living Communities | Five Star | |||||||||
Real Estate Properties | |||||||||
Number of Properties | community | 7 | ||||||||
Purchase price excluding closing costs | $ 112,350 | ||||||||
Number of pre-existing management agreements terminated | agreement | 3 | ||||||||
Number of new management agreements entered | agreement | 10 | ||||||||
MOBs | |||||||||
Real Estate Properties | |||||||||
Number of buildings sold | building | 4 | ||||||||
Acquisition | |||||||||
Real Estate Properties | |||||||||
Weighted average amortization period | 6 years 4 months 24 days | ||||||||
Weighted average amortization period of assumed real estate lease obligations | 7 years 3 months 18 days | ||||||||
Acquisition | MOBs | |||||||||
Real Estate Properties | |||||||||
Number of Properties | property | 1 | 2 | |||||||
Number of buildings acquired | building | 1 | 4 | |||||||
Area of real estate properties (in square feet) | ft² | 294,000 | 166,000 | 294,000 | ||||||
Cash Paid plus Assumed Debt, excluding closing costs | $ 67,700 | ||||||||
Intangible lease liabilities recorded | $ (1,760) | (1,760) | |||||||
Acquired Real Estate Leases | $ 5,163 | 5,163 | |||||||
Assumption of mortgage notes payable | 0 | ||||||||
Premium on Assumed Debt | 0 | ||||||||
Purchase price excluding closing costs | $ 45,000 | ||||||||
Land | Acquisition | MOBs | |||||||||
Real Estate Properties | |||||||||
Property plant and equipment acquired | 7,121 | ||||||||
Building improvements | Acquisition | MOBs | |||||||||
Real Estate Properties | |||||||||
Property plant and equipment acquired | $ 57,176 | ||||||||
4 States | Triple Net Leased Senior Living Communities | |||||||||
Real Estate Properties | |||||||||
Number of states in which properties are located | state | 4 | 4 | |||||||
Number of Properties | property | 7 | ||||||||
Assumption of mortgage notes payable | $ 0 | ||||||||
Premium on Assumed Debt | $ 0 | ||||||||
Number of private pay independent living units | item | 545 | ||||||||
Purchase price excluding closing costs | $ 112,350 | ||||||||
4 States | Land | Triple Net Leased Senior Living Communities | |||||||||
Real Estate Properties | |||||||||
Cash Paid plus Assumed Debt, excluding closing costs | 10,630 | ||||||||
4 States | Building improvements | Triple Net Leased Senior Living Communities | |||||||||
Real Estate Properties | |||||||||
Cash Paid plus Assumed Debt, excluding closing costs | 99,590 | ||||||||
4 States | Furniture, fixtures and equipment | Triple Net Leased Senior Living Communities | |||||||||
Real Estate Properties | |||||||||
Cash Paid plus Assumed Debt, excluding closing costs | $ 2,130 | ||||||||
Minnesota | Acquisition | MOBs | |||||||||
Real Estate Properties | |||||||||
Number of Properties | property | 1 | ||||||||
Number of buildings acquired | building | 3 | ||||||||
Area of real estate properties (in square feet) | ft² | 128,000 | ||||||||
Cash Paid plus Assumed Debt, excluding closing costs | $ 22,700 | ||||||||
Intangible lease liabilities recorded | (1,760) | ||||||||
Acquired Real Estate Leases | 5,163 | ||||||||
Assumption of mortgage notes payable | 0 | ||||||||
Premium on Assumed Debt | 0 | ||||||||
Minnesota | Land | Acquisition | MOBs | |||||||||
Real Estate Properties | |||||||||
Property plant and equipment acquired | 4,074 | ||||||||
Minnesota | Building improvements | Acquisition | MOBs | |||||||||
Real Estate Properties | |||||||||
Property plant and equipment acquired | $ 15,223 | ||||||||
Florida | MOBs | |||||||||
Real Estate Properties | |||||||||
Number of Properties | property | 1 | ||||||||
Number of buildings acquired | building | 1 | ||||||||
Area of real estate properties (in square feet) | ft² | 166,000 | ||||||||
Cash Paid plus Assumed Debt, excluding closing costs | $ 45,000 | ||||||||
Intangible lease liabilities recorded | 0 | ||||||||
Acquired Real Estate Leases | 0 | ||||||||
Assumption of mortgage notes payable | 0 | ||||||||
Premium on Assumed Debt | 0 | ||||||||
Florida | Land | MOBs | |||||||||
Real Estate Properties | |||||||||
Land | 3,047 | ||||||||
Florida | Building improvements | MOBs | |||||||||
Real Estate Properties | |||||||||
Property plant and equipment acquired | 41,953 | ||||||||
Georgia | Senior Living Communities | Five Star | |||||||||
Real Estate Properties | |||||||||
Purchase price excluding closing costs | $ 8,400 | ||||||||
Georgia | Acquisition | Managed Senior Living Communities | Five Star | TRS | |||||||||
Real Estate Properties | |||||||||
Number of Properties | property | 1 | ||||||||
Acquired Real Estate Leases | $ 1,400 | ||||||||
Assumption of mortgage notes payable | 0 | ||||||||
Premium on Assumed Debt | $ 0 | ||||||||
Number of communities | property | 1 | ||||||||
Number of private pay independent living units | property | 38 | ||||||||
Purchase price excluding closing costs | $ 8,400 | ||||||||
Georgia | Land | Acquisition | Managed Senior Living Communities | Five Star | TRS | |||||||||
Real Estate Properties | |||||||||
Purchase price excluding closing costs | 327 | ||||||||
Georgia | Building improvements | Acquisition | Managed Senior Living Communities | Five Star | TRS | |||||||||
Real Estate Properties | |||||||||
Purchase price excluding closing costs | 6,195 | ||||||||
Georgia | Furniture, fixtures and equipment | Acquisition | Managed Senior Living Communities | Five Star | TRS | |||||||||
Real Estate Properties | |||||||||
Purchase price excluding closing costs | $ 478 |
Real Estate Properties - Discon
Real Estate Properties - Discontinued Operations and Properties Held for Sale (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Jul. 31, 2016USD ($)building | Jun. 30, 2016USD ($)building | Apr. 30, 2016USD ($)item | Mar. 31, 2016USD ($)property | Jun. 30, 2016USD ($)building | Mar. 31, 2016USD ($)communityitemproperty | Jun. 30, 2016USD ($)building | Jun. 30, 2016property | |
Real estate properties | ||||||||
Impairment of assets | $ 4,961 | $ 12,351 | ||||||
Number of tenants | item | 1 | |||||||
Gain on sale of properties | 4,061 | $ 4,061 | ||||||
Five Star | TRS | ||||||||
Real estate properties | ||||||||
Proceeds from settlement agreement | $ 2,365 | |||||||
Triple Net Leased Senior Living Communities | ||||||||
Real estate properties | ||||||||
Impairment of assets | $ 4,391 | |||||||
Number of communities | community | 2 | |||||||
Number of tenants | item | 2 | |||||||
MOBs | ||||||||
Real estate properties | ||||||||
Impairment of assets | $ 4,961 | |||||||
Number of Buildings Held For Sale | 5 | 5 | 5 | 5 | ||||
Number of buildings sold | building | 4 | |||||||
MOBs | Discontinued Operations, Held-for-sale or Disposed of by Sale | ||||||||
Real estate properties | ||||||||
Number of properties sold | building | 4 | |||||||
Sale price of property sold and agreed to be sold | $ 20,150 | |||||||
MOB and land parcel | ||||||||
Real estate properties | ||||||||
Impairment of assets | $ 2,999 | |||||||
Land parcel | ||||||||
Real estate properties | ||||||||
Number of properties classified as held for sale | property | 1 | 1 | ||||||
Land parcel | Discontinued Operations, Disposed of by Sale | ||||||||
Real estate properties | ||||||||
Sale price of property sold and agreed to be sold | $ 700 | |||||||
Skilled Nursing Facilities | Discontinued Operations, Held-for-sale or Disposed of by Sale | ||||||||
Real estate properties | ||||||||
Number of properties sold | building | 1 | |||||||
Sale price of property sold and agreed to be sold | $ 9,100 | |||||||
Gain on sale of properties | $ 4,061 |
Investments in Available for 25
Investments in Available for Sale Securities (Details) $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($)$ / sharesshares | |
Five Star | |
Unrealized gain on investments | |
Investment in common shares | shares | 4,235,000 |
Amount of investment acquired | $ 14,230 |
Fair value of the investments in available for sale securities | 9,910 |
Unrealized loss | $ 4,320 |
Weighted average costs (in dollars per share) | $ / shares | $ 2.34 |
The RMR Group Inc | |
Unrealized gain on investments | |
Amount of investment acquired | $ 69,826 |
Fair value of the investments in available for sale securities | 81,681 |
Unrealized gain | $ 11,855 |
Weighted average costs (in dollars per share) | $ / shares | $ 30.97 |
The RMR Group Inc | Class A common shares | |
Unrealized gain on investments | |
Investment in common shares | shares | 2,637,408 |
Indebtedness (Details)
Indebtedness (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||
Jul. 31, 2016USD ($)loanbuildingproperty | Apr. 30, 2016USD ($)property | Feb. 29, 2016USD ($) | Jan. 31, 2016USD ($)property | Sep. 30, 2015 | Jun. 30, 2016USD ($)propertybuildingitem | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)propertybuildingitem | Jun. 30, 2015USD ($) | Aug. 04, 2016USD ($) | Dec. 31, 2015USD ($) | |
Indebtedness | |||||||||||
Number of public issues of unsecured senior notes | item | 6 | 6 | |||||||||
Principal amount of unsecured senior notes | $ 1,721,306,000 | $ 1,721,306,000 | $ 1,478,536,000 | ||||||||
Aggregate principal amount of mortgage debt | 636,087,000 | 636,087,000 | |||||||||
Carrying value of mortgaged properties | 6,418,923,000 | 6,418,923,000 | 6,309,400,000 | ||||||||
Unsecured revolving credit facility | 749,000,000 | 749,000,000 | $ 775,000,000 | ||||||||
Loss on early extinguishment of debt | $ (39,000) | (6,000) | $ (1,448,000) | ||||||||
Unsecured revolving credit facility | |||||||||||
Indebtedness | |||||||||||
Unsecured revolving credit facility, maximum borrowing capacity | 1,000,000,000 | 1,000,000,000 | |||||||||
Option to increase the borrowing capacity under revolving credit facility | $ 1,500,000 | $ 1,500,000 | |||||||||
Revolving credit facility, interest rate payable (as a percent) | 1.70% | 1.70% | |||||||||
Interest expense and other associated costs incurred | $ 3,454,000 | $ 2,063,000 | $ 7,136,000 | $ 3,003,000 | |||||||
Unsecured revolving credit facility | $ 749,000,000 | $ 749,000,000 | $ 100,000,000 | ||||||||
Weighted average interest rate on debt (as a percent) | 1.70% | 1.50% | 1.70% | 1.50% | |||||||
Revolving credit facility, available amount | $ 251,000,000 | $ 251,000,000 | $ 900,000,000 | ||||||||
Unsecured revolving credit facility | LIBOR | |||||||||||
Indebtedness | |||||||||||
Interest rate added to the base rate (as a percent) | 130.00% | ||||||||||
Debt instrument, facility fee (as a percent) | 30.00% | ||||||||||
Senior unsecured notes due 2019 | |||||||||||
Indebtedness | |||||||||||
Principal amount of unsecured senior notes | $ 400,000,000 | $ 400,000,000 | |||||||||
Interest rate (as a percent) | 3.25% | 3.25% | |||||||||
Senior unsecured notes 6.75% | |||||||||||
Indebtedness | |||||||||||
Principal amount of unsecured senior notes | $ 200,000,000 | $ 200,000,000 | |||||||||
Interest rate (as a percent) | 6.75% | 6.75% | |||||||||
Unsecured senior notes due 2021 | |||||||||||
Indebtedness | |||||||||||
Principal amount of unsecured senior notes | $ 300,000,000 | $ 300,000,000 | |||||||||
Interest rate (as a percent) | 6.75% | 6.75% | |||||||||
Senior unsecured notes due 2024 | |||||||||||
Indebtedness | |||||||||||
Principal amount of unsecured senior notes | $ 250,000,000 | $ 250,000,000 | |||||||||
Interest rate (as a percent) | 4.75% | 4.75% | |||||||||
Senior unsecured notes 5.625% due in 2042 | |||||||||||
Indebtedness | |||||||||||
Principal amount of unsecured senior notes | $ 350,000,000 | $ 350,000,000 | |||||||||
Interest rate (as a percent) | 5.625% | 5.625% | |||||||||
Senior unsecured notes 6.25% due in 2046 | |||||||||||
Indebtedness | |||||||||||
Principal amount of unsecured senior notes | $ 250,000,000 | $ 250,000,000 | |||||||||
Interest rate (as a percent) | 6.25% | 6.25% | 6.25% | ||||||||
Sale of senior unsecured notes | $ 250,000,000 | ||||||||||
Net proceeds after underwriting discounts from sale of senior unsecured notes | $ 241,350,000 | ||||||||||
Mortgages | |||||||||||
Indebtedness | |||||||||||
Number of properties mortgaged | property | 1 | 1 | 1 | 54 | 54 | ||||||
Number of buildings mortgaged | building | 55 | 55 | |||||||||
Carrying value of mortgaged properties | $ 1,040,792,000 | $ 1,040,792,000 | |||||||||
Weighted average interest rate on prepaid debt (as a percent) | 6.25% | 4.65% | 5.97% | ||||||||
Prepayment of mortgage | $ 11,871,000 | $ 18,000,000 | $ 6,115,000 | ||||||||
Capital leases | |||||||||||
Indebtedness | |||||||||||
Carrying value of mortgaged properties | $ 36,039,000 | $ 36,039,000 | |||||||||
Number of properties recorded under capital lease | property | 2 | 2 | |||||||||
Capital leases | $ 11,817,000 | $ 11,817,000 | |||||||||
Unsecured Debt | |||||||||||
Indebtedness | |||||||||||
Weighted average interest rate on debt (as a percent) | 2.30% | 2.30% | |||||||||
Unsecured Debt | LIBOR | |||||||||||
Indebtedness | |||||||||||
Interest rate added to the base rate (as a percent) | 180.00% | 140.00% | |||||||||
Term Loan Due 2020 | |||||||||||
Indebtedness | |||||||||||
Interest rate (as a percent) | 1.90% | 1.90% | |||||||||
Unsecured term loan facility | $ 350,000,000 | $ 350,000,000 | |||||||||
Interest expense and other associated costs incurred | $ 1,635,000 | $ 1,449,000 | $ 3,249,000 | $ 2,823,000 | |||||||
Weighted average interest rate on debt (as a percent) | 1.90% | 1.60% | 1.90% | 1.60% | |||||||
Maximum borrowing capacity that may be increased | $ 700,000,000 | $ 700,000,000 | |||||||||
Term Loan Due 2022 | |||||||||||
Indebtedness | |||||||||||
Principal amount of unsecured senior notes | 200,000,000 | 200,000,000 | |||||||||
Unsecured term loan facility | 200,000,000 | $ 200,000,000 | |||||||||
Weighted average interest rate on debt (as a percent) | 2.30% | ||||||||||
Maximum borrowing capacity that may be increased | 400,000,000 | $ 400,000,000 | |||||||||
Unsecured Debt September 2015 | |||||||||||
Indebtedness | |||||||||||
Interest expense and other associated costs incurred | $ 1,133,000 | $ 2,260,000 | |||||||||
Prepayment Notification | Mortgages | |||||||||||
Indebtedness | |||||||||||
Number of properties mortgaged | loan | 2 | ||||||||||
Weighted average interest rate on prepaid debt (as a percent) | 5.92% | ||||||||||
Number of mortgage notes | loan | 2 | ||||||||||
Prepayment of mortgage | $ 79,957,000 | ||||||||||
MOBs | Secured debt financing due 2026 | |||||||||||
Indebtedness | |||||||||||
Aggregate principal amount of mortgage debt | $ 620,000,000 | ||||||||||
Number of properties mortgaged | property | 1 | ||||||||||
Number of buildings mortgaged | building | 2 | ||||||||||
Weighted average interest rate on debt (as a percent) | 3.53% |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 12, 2016 | May 19, 2016 | Feb. 23, 2016 | Jun. 30, 2016 | Jun. 30, 2015 |
Shareholders' Equity | |||||
Common stock dividend declared (in dollars per share) | $ 0.39 | ||||
Common stock dividends payable | $ 92,619 | ||||
Distribution to common shareholders (in dollars per share) | $ 0.39 | $ 0.39 | |||
Distribution to common shareholders | $ 92,614 | $ 92,614 | $ 185,228 | $ 171,185 |
Fair Value of Assets and Liab28
Fair Value of Assets and Liabilities (Details) $ in Thousands | Jun. 30, 2016building | Jun. 30, 2016item | Jun. 30, 2016property | Jun. 30, 2016USD ($) | Jun. 30, 2016shares | Dec. 31, 2015USD ($) |
Assets and liabilities measured at fair value | ||||||
Senior unsecured notes | $ 1,721,306 | $ 1,478,536 | ||||
Secured mortgage debt and capital leases | 647,176 | 679,295 | ||||
Number of public issues of unsecured senior notes | item | 6 | |||||
Carrying value | ||||||
Assets and liabilities measured at fair value | ||||||
Senior unsecured notes | 1,721,306 | 1,478,536 | ||||
Secured mortgage debt and capital leases | 647,176 | 679,295 | ||||
Debt Instrument | 2,368,482 | 2,157,831 | ||||
Fair value | ||||||
Assets and liabilities measured at fair value | ||||||
Senior unsecured notes | 1,827,523 | 1,548,613 | ||||
Secured mortgage debt and capital leases | 694,701 | 724,615 | ||||
Debt Instrument | 2,522,224 | $ 2,273,228 | ||||
MOBs | ||||||
Assets and liabilities measured at fair value | ||||||
Number of buildings classified as held for sale | 5 | 5 | ||||
Recurring | ||||||
Assets and liabilities measured at fair value | ||||||
Investments in available for sale securities | 91,591 | |||||
Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||||||
Assets and liabilities measured at fair value | ||||||
Investments in available for sale securities | 91,591 | |||||
Nonrecurring | ||||||
Assets and liabilities measured at fair value | ||||||
Assets held for sale | 21,307 | |||||
Nonrecurring | Significant Unobservable Inputs (Level 3) | ||||||
Assets and liabilities measured at fair value | ||||||
Assets held for sale | 21,307 | |||||
Five Star | ||||||
Assets and liabilities measured at fair value | ||||||
Investment in common shares | shares | 4,235,000 | |||||
Five Star | Common Shares | ||||||
Assets and liabilities measured at fair value | ||||||
Investment in common shares | shares | 4,235,000 | |||||
Amount of investment acquired | 14,230 | |||||
Unrealized loss | 4,320 | |||||
RMR Inc | Class A common shares | ||||||
Assets and liabilities measured at fair value | ||||||
Investment in common shares | shares | 2,637,408 | |||||
Amount of investment acquired | 69,826 | |||||
Unrealized gain | $ 11,855 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)segment | Jun. 30, 2015USD ($) | Dec. 31, 2015USD ($) | |
Segment reporting | |||||
Number of operating segments | segment | 4 | ||||
Number of reportable segments | segment | 3 | ||||
Revenues: | |||||
Rental income | $ 163,997 | $ 155,546 | $ 325,419 | $ 301,329 | |
Residents fees and services | 97,370 | 91,856 | 194,323 | 174,649 | |
Total revenues | 261,367 | 247,402 | 519,742 | 475,978 | |
Expenses: | |||||
Property operating expenses | 97,474 | 93,592 | 195,422 | 179,386 | |
Depreciation and amortization | 71,372 | 62,511 | 142,594 | 116,218 | |
General and administrative | 11,965 | 11,674 | 22,828 | 22,248 | |
Acquisition related costs | 180 | 4,617 | 619 | 5,775 | |
Impairment of assets | 4,961 | 12,351 | |||
Total expenses | 185,952 | 172,394 | 373,814 | 323,627 | |
Operating income (loss) | 75,415 | 75,008 | 145,928 | 152,351 | |
Dividend income | 789 | ||||
Interest and other income | 177 | 142 | 242 | 217 | |
Interest expense | (41,118) | (37,907) | (80,399) | (73,848) | |
Loss on early extinguishment of debt | (39) | (6) | (1,448) | ||
Income (loss) before income tax expense and equity in earnings of an investee | 35,263 | 37,204 | 66,554 | 77,272 | |
Income tax expense | (108) | (129) | (202) | (239) | |
Equity in earnings of an investee | 17 | 23 | 94 | 95 | |
Income (loss) from continuing operations | 35,172 | 37,098 | 66,446 | 77,128 | |
Discontinued operations: | |||||
Loss from discontinued operations | (109) | (350) | |||
Impairment of assets from discontinued operations | (602) | (602) | |||
Income before gain on sale of properties | 35,172 | 36,387 | 66,446 | 76,176 | |
Gain on sale of properties | 4,061 | 4,061 | |||
Income (loss) before gain on sale of properties | 35,172 | 36,387 | 66,446 | 76,176 | |
Gain on sale of properties | 4,061 | 4,061 | |||
Net income (loss) | 39,233 | 36,387 | 70,507 | 76,176 | |
Total assets | 7,265,767 | 7,265,767 | $ 7,160,090 | ||
Triple Net Leased Senior Living Communities | |||||
Revenues: | |||||
Rental income | 66,441 | 61,347 | 131,749 | 116,598 | |
Total revenues | 66,441 | 61,347 | 131,749 | 116,598 | |
Expenses: | |||||
Property operating expenses | 423 | 786 | |||
Depreciation and amortization | 19,273 | 17,058 | 38,674 | 32,183 | |
Impairment of assets | 4,391 | ||||
Total expenses | 19,696 | 17,058 | 43,851 | 32,183 | |
Operating income (loss) | 46,745 | 44,289 | 87,898 | 84,415 | |
Interest expense | (6,282) | (6,270) | (12,665) | (12,255) | |
Loss on early extinguishment of debt | (6) | (6) | |||
Income (loss) before income tax expense and equity in earnings of an investee | 40,463 | 38,013 | 75,233 | 72,154 | |
Income (loss) from continuing operations | 38,013 | 72,154 | |||
Discontinued operations: | |||||
Income before gain on sale of properties | 40,463 | 38,013 | 75,233 | ||
Gain on sale of properties | 4,061 | 4,061 | |||
Income (loss) before gain on sale of properties | 40,463 | 38,013 | 75,233 | ||
Gain on sale of properties | 4,061 | 4,061 | |||
Net income (loss) | 44,524 | 79,294 | 72,154 | ||
Total assets | 2,318,798 | 2,318,798 | 2,251,212 | ||
Managed Senior Living Communities | |||||
Revenues: | |||||
Residents fees and services | 97,370 | 91,856 | 194,323 | 174,649 | |
Total revenues | 97,370 | 91,856 | 194,323 | 174,649 | |
Expenses: | |||||
Property operating expenses | 71,642 | 69,792 | 143,820 | 132,195 | |
Depreciation and amortization | 20,140 | 13,649 | 40,158 | 22,109 | |
Total expenses | 91,782 | 83,441 | 183,978 | 154,304 | |
Operating income (loss) | 5,588 | 8,415 | 10,345 | 20,345 | |
Interest expense | (2,663) | (2,561) | (5,227) | (4,580) | |
Loss on early extinguishment of debt | (33) | (6) | (33) | ||
Income (loss) before income tax expense and equity in earnings of an investee | 2,925 | 5,821 | 5,112 | 15,732 | |
Income (loss) from continuing operations | 5,821 | 15,732 | |||
Discontinued operations: | |||||
Income before gain on sale of properties | 2,925 | 5,821 | 5,112 | ||
Income (loss) before gain on sale of properties | 2,925 | 5,821 | 5,112 | ||
Net income (loss) | 2,925 | 5,112 | 15,732 | ||
Total assets | 1,258,212 | 1,258,212 | 1,260,425 | ||
MOBs | |||||
Revenues: | |||||
Rental income | 92,978 | 89,591 | 184,559 | 175,592 | |
Total revenues | 92,978 | 89,591 | 184,559 | 175,592 | |
Expenses: | |||||
Property operating expenses | 25,409 | 23,800 | 50,816 | 47,191 | |
Depreciation and amortization | 31,011 | 30,856 | 61,866 | 60,030 | |
Impairment of assets | 4,961 | 7,960 | |||
Total expenses | 61,381 | 54,656 | 120,642 | 107,221 | |
Operating income (loss) | 31,597 | 34,935 | 63,917 | 68,371 | |
Interest expense | (844) | (1,758) | (1,798) | (3,525) | |
Income (loss) before income tax expense and equity in earnings of an investee | 30,753 | 33,177 | 62,119 | 64,846 | |
Income (loss) from continuing operations | 33,177 | 64,846 | |||
Discontinued operations: | |||||
Loss from discontinued operations | (109) | (350) | |||
Impairment of assets from discontinued operations | (602) | (602) | |||
Income before gain on sale of properties | 30,753 | 32,466 | 62,119 | ||
Income (loss) before gain on sale of properties | 30,753 | 32,466 | 62,119 | ||
Net income (loss) | 30,753 | 62,119 | 63,894 | ||
Total assets | 3,374,952 | 3,374,952 | 3,362,214 | ||
All Other Operations | |||||
Revenues: | |||||
Rental income | 4,578 | 4,608 | 9,111 | 9,139 | |
Total revenues | 4,578 | 4,608 | 9,111 | 9,139 | |
Expenses: | |||||
Depreciation and amortization | 948 | 948 | 1,896 | 1,896 | |
General and administrative | 11,965 | 11,674 | 22,828 | 22,248 | |
Acquisition related costs | 180 | 4,617 | 619 | 5,775 | |
Total expenses | 13,093 | 17,239 | 25,343 | 29,919 | |
Operating income (loss) | (8,515) | (12,631) | (16,232) | (20,780) | |
Dividend income | 789 | ||||
Interest and other income | 177 | 142 | 242 | 217 | |
Interest expense | (31,329) | (27,318) | (60,709) | (53,488) | |
Loss on early extinguishment of debt | (1,409) | ||||
Income (loss) before income tax expense and equity in earnings of an investee | (38,878) | (39,807) | (75,910) | (75,460) | |
Income tax expense | (108) | (129) | (202) | (239) | |
Equity in earnings of an investee | 17 | 23 | 94 | 95 | |
Income (loss) from continuing operations | (39,913) | (75,604) | |||
Discontinued operations: | |||||
Income before gain on sale of properties | (38,969) | (39,913) | (76,018) | ||
Income (loss) before gain on sale of properties | (38,969) | $ (39,913) | (76,018) | ||
Net income (loss) | (38,969) | (76,018) | $ (75,604) | ||
Total assets | $ 313,805 | $ 313,805 | $ 286,239 |
Significant Tenant (Details)
Significant Tenant (Details) - Five Star | 6 Months Ended |
Jun. 30, 2016 | |
Rents from significant lessee | |
% of Total (as a percent) | 18.50% |
Investment | |
% of Total (as a percent) | 29.70% |
Related Person Transactions - F
Related Person Transactions - Five Star (Details) $ in Thousands | Jun. 29, 2016USD ($)agreementcommunityitem | May 31, 2016USD ($)property | Jun. 30, 2016USD ($)communityshares | Jun. 30, 2015USD ($)community | Jun. 30, 2016USD ($)communityshares | Jun. 30, 2016USD ($)communityitemshares | Jun. 30, 2016USD ($)communitypropertyshares | Jun. 30, 2016USD ($)communityshares | Jun. 30, 2015USD ($)community | Jul. 31, 2016property | Apr. 30, 2016property | Dec. 31, 2015USD ($) | May 31, 2015 | Dec. 31, 2001 |
Five Star | ||||||||||||||
Related person transactions | ||||||||||||||
Percentage of total shares outstanding | 8.60% | 8.60% | 8.60% | 8.60% | 8.60% | 100.00% | ||||||||
Investment in common shares | shares | 4,235,000 | 4,235,000 | 4,235,000 | 4,235,000 | 4,235,000 | |||||||||
Number of real estate properties leased | community | 184 | 180 | 184 | 184 | 184 | 184 | 180 | |||||||
Number of pre-existing agreements | agreement | 4 | |||||||||||||
Number of combination or pooling agreements | agreement | 9 | |||||||||||||
Total rental income recognized | $ 48,234 | $ 47,753 | $ 96,341 | $ 95,443 | ||||||||||
Estimated percentage rent payments received | 1,388 | 1,393 | 2,861 | 2,824 | ||||||||||
Rents receivable | 16,065 | $ 16,065 | $ 16,065 | $ 16,065 | 16,065 | $ 17,466 | ||||||||
Five Star | Senior Living Communities | ||||||||||||||
Related person transactions | ||||||||||||||
Number of properties acquired or agreed to be acquired | community | 7 | |||||||||||||
Initial annual rent | $ 8,426 | |||||||||||||
Purchase price excluding closing costs and working capital adjustments | $ 112,350 | |||||||||||||
Annual rent percentage (as a percent) | 4 | |||||||||||||
Number of consecutive renewal terms of agreement | item | 2 | |||||||||||||
Renewal period | 15 years | |||||||||||||
Number of pre-existing management agreements terminated | agreement | 3 | |||||||||||||
Number of new management agreements entered | agreement | 10 | |||||||||||||
Real estate improvements purchased | 11,836 | 8,902 | ||||||||||||
Increase or decrease in annual lease rent payable | 949 | 717 | $ 949 | $ 949 | $ 949 | 949 | $ 717 | |||||||
Number of properties acquired, referred to as managed properties | 62 | 62 | 60 | |||||||||||
Property management agreement expense | $ 2,819 | $ 2,699 | $ 5,623 | $ 5,222 | ||||||||||
Five Star | Senior Living Communities | Georgia | ||||||||||||||
Related person transactions | ||||||||||||||
Purchase price excluding closing costs and working capital adjustments | $ 8,400 | |||||||||||||
Number of living units | property | 38 | |||||||||||||
Five Star | Senior Living Communities | North Carolina | ||||||||||||||
Related person transactions | ||||||||||||||
Number of living units | property | 87 | |||||||||||||
Five Star | Senior Living Communities | Alabama | ||||||||||||||
Related person transactions | ||||||||||||||
Number of living units | property | 163 | |||||||||||||
First AL Pooling Agreement | Five Star | ||||||||||||||
Related person transactions | ||||||||||||||
Minimum annual rent from Five Star | $ 3,610 | |||||||||||||
Management fees as a percentage of gross revenues | 5.00% | 3.00% | ||||||||||||
Incentive fee as percentage of the annual net operating income after the entity realizes an annual return equal to 8% of invested capital | 20.00% | 35.00% | ||||||||||||
Payment of capital expenditure as a percentage of the amount funded by entity | 3 | 7 | ||||||||||||
Number of consecutive period during which the entity must not receive the minimum return for the property management agreement to be subject to the pooling agreement | 3 years | |||||||||||||
First AL Pooling Agreement | Five Star | Minimum | ||||||||||||||
Related person transactions | ||||||||||||||
Annual return as a percentage of invested surplus specified as a base for determining incentive fee | 8.00% | |||||||||||||
First AL Pooling Agreement | Five Star | Maximum | ||||||||||||||
Related person transactions | ||||||||||||||
Annual return as a percentage of invested surplus specified as a base for determining incentive fee | 7.00% | |||||||||||||
First AL Pooling Agreement | Five Star | Senior Living Communities | ||||||||||||||
Related person transactions | ||||||||||||||
Annual return as a percentage of invested surplus specified as a base for determining incentive fee | 7.00% | |||||||||||||
Acquisition | MOBs | ||||||||||||||
Related person transactions | ||||||||||||||
Number of properties acquired or agreed to be acquired | property | 1 | 2 | ||||||||||||
Purchase price excluding closing costs and working capital adjustments | $ 45,000 |
Related Person Transactions - M
Related Person Transactions - Management Fees and Reimbursements (Details) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | May 31, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | |
Related person transactions | |||||
Property management and construction supervision fees | $ 2,686 | $ 2,532 | $ 5,232 | $ 4,969 | |
Property management and construction supervision fees paid | 2,171 | 1,494 | 4,299 | 3,235 | |
RMR LLC | |||||
Related person transactions | |||||
Business management fees incurred | 9,243 | 9,144 | 17,590 | 18,014 | |
Incentive fees payable | 0 | 0 | 0 | 0 | |
Common shares issued as payment for base business management fee | 68,983 | ||||
Accrual for RMR LLC employee share grants and internal audit costs | $ 589 | $ 316 | $ 1,174 | $ 777 |
Related Person Transactions - I
Related Person Transactions - Investment in RMR Inc (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 12, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 |
Related person transactions | ||||||
Common stock dividend declared (in dollars per share) | $ 0.39 | |||||
Income (loss) recognized arising from equity investments | $ 17 | $ 23 | $ 94 | $ 95 | ||
Change in net unrealized gain(loss) on investments | 15,931 | 1,387 | 40,118 | 2,835 | ||
RMR LLC | ||||||
Related person transactions | ||||||
Rental revenue from related party | 61 | 51 | 171 | 102 | ||
RMR LLC | RMR Inc | ||||||
Related person transactions | ||||||
Initial other liabilities | 73,819 | 73,819 | ||||
AIC | ||||||
Related person transactions | ||||||
Equity method investments, carrying value | 7,016 | 7,016 | $ 6,827 | |||
Income (loss) recognized arising from equity investments | 17 | 23 | 94 | 95 | ||
Property insurance premium | 3,607 | |||||
Change in net unrealized gain(loss) on investments | 43 | (64) | 95 | (19) | ||
RMR Inc | ||||||
Related person transactions | ||||||
Amortization of other liabilities to reduce business and property management fees | $ 943 | $ 243 | $ 243 | |||
RMR Inc | RMR Inc | ||||||
Related person transactions | ||||||
Amortization of other liabilities to reduce business and property management fees | $ 1,886 | |||||
Class A common shares | RMR Inc | ||||||
Related person transactions | ||||||
Number of shares purchased | 2,637,408 | |||||
Common stock dividend declared (in dollars per share) | $ 0.25 | |||||
Dividends received | $ 789 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Components of provision for income taxes | ||||
Income Tax Expense (Benefit) | $ 108 | $ 129 | $ 202 | $ 239 |
Weighted Average Common Share35
Weighted Average Common Shares (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Weighted Average Common Shares | ||||
Weighted average common shares outstanding (basic) (in shares) | 237,325 | 235,549 | 237,320 | 228,501 |
Effect of dilutive securities: unvested share awards | 38 | 43 | 29 | 33 |
Weighted average common shares outstanding (diluted) (in shares) | 237,363 | 235,592 | 237,349 | 228,534 |