Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2020 | May 04, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-32641 | |
Entity Registrant Name | BROOKDALE SENIOR LIVING INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-3068069 | |
Entity Address, Address Line One | 111 Westwood Place, | |
Entity Address, Address Line Two | Suite 400, | |
Entity Address, City or Town | Brentwood, | |
Entity Address, State or Province | TN | |
Entity Address, Postal Zip Code | 37027 | |
City Area Code | 615 | |
Local Phone Number | 221-2250 | |
Title of 12(b) Security | Common Stock, $0.01 Par Value Per Share | |
Entity Trading Symbol | BKD | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 183,164,490 | |
Entity Central Index Key | 0001332349 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 392,674 | $ 240,227 |
Marketable securities | 108,039 | 68,567 |
Restricted cash | 23,908 | 26,856 |
Accounts receivable, net | 135,531 | 133,613 |
Assets held for sale | 37,397 | 42,671 |
Prepaid expenses and other current assets, net | 104,432 | 84,241 |
Total current assets | 801,981 | 596,175 |
Property, plant and equipment and leasehold intangibles, net | 5,298,910 | 5,109,834 |
Operating lease right-of-use assets | 1,080,304 | 1,159,738 |
Restricted cash | 41,917 | 34,614 |
Investment in unconsolidated ventures | 5,600 | 21,210 |
Goodwill | 154,131 | 154,131 |
Deferred tax asset | 6,370 | 0 |
Other assets, net | 112,482 | 118,731 |
Total assets | 7,501,695 | 7,194,433 |
Current liabilities | ||
Current portion of long-term debt | 83,014 | 339,413 |
Current portion of financing lease obligations | 19,213 | 63,146 |
Current portion of operating lease obligations | 184,189 | 193,587 |
Trade accounts payable | 78,134 | 104,721 |
Accrued expenses | 244,916 | 266,703 |
Refundable fees and deferred revenue | 76,634 | 79,402 |
Total current liabilities | 686,100 | 1,046,972 |
Long-term debt, less current portion | 3,644,542 | 3,215,710 |
Financing lease obligations, less current portion | 562,348 | 771,434 |
Operating lease obligations, less current portion | 1,272,448 | 1,277,178 |
Line of credit | 166,381 | 0 |
Deferred tax liability | 0 | 15,397 |
Other liabilities | 117,646 | 169,017 |
Total liabilities | 6,449,465 | 6,495,708 |
Preferred stock, $0.01 par value, 50,000,000 shares authorized at March 31, 2020 and December 31, 2019; no shares issued and outstanding | 0 | 0 |
Common stock, $0.01 par value, 400,000,000 shares authorized at March 31, 2020 and December 31, 2019; 198,539,694 and 199,593,343 shares issued and 188,012,169 and 192,128,586 shares outstanding (including 4,849,689 and 7,252,459 unvested restricted shares), respectively | 1,985 | 1,996 |
Additional paid-in-capital | 4,174,356 | 4,172,099 |
Treasury stock, at cost; 10,527,525 and 7,464,757 shares at March 31, 2020 and December 31, 2019, respectively | (102,774) | (84,651) |
Accumulated deficit | (3,023,688) | (3,393,088) |
Total Brookdale Senior Living Inc. stockholders' equity | 1,049,879 | 696,356 |
Noncontrolling interest | 2,351 | 2,369 |
Total equity | 1,052,230 | 698,725 |
Total liabilities and equity | $ 7,501,695 | $ 7,194,433 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Equity, Number of Shares, Par Value and Other Disclosures [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 198,539,694 | 199,593,343 |
Common stock, shares outstanding (in shares) | 188,012,169 | 192,128,586 |
Treasury stock, shares (in shares) | 10,527,525 | 7,464,757 |
Unvested Restricted Stock | ||
Equity, Number of Shares, Par Value and Other Disclosures [Abstract] | ||
Common stock, shares outstanding (in shares) | 4,849,689 | 7,252,459 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue | ||
Revenue | $ 1,014,139 | $ 1,042,044 |
Expense | ||
General and administrative expense (including non-cash stock-based compensation expense of $5,957 and $6,356, respectively) | 54,595 | 56,311 |
Facility operating lease expense | 64,481 | 68,668 |
Depreciation and amortization | 90,738 | 96,888 |
Asset impairment | 78,226 | 391 |
Loss (gain) on facility lease termination and modification, net | 0 | 209 |
Total operating expense | 999,239 | 1,025,383 |
Income (loss) from operations | 14,900 | 16,661 |
Interest income | 1,455 | 3,084 |
Interest expense: | ||
Debt | (41,763) | (45,643) |
Financing lease obligations | (13,282) | (16,743) |
Amortization of deferred financing costs and debt discount | (1,315) | (979) |
Gain (loss) on debt modification and extinguishment, net | 19,181 | (67) |
Equity in earnings (loss) of unconsolidated ventures | (1,008) | (526) |
Gain (loss) on sale of assets, net | 372,839 | (702) |
Other non-operating income (loss) | 2,662 | 2,988 |
Income (loss) before income taxes | 353,669 | (41,927) |
Benefit (provision) for income taxes | 15,828 | (679) |
Net income (loss) | 369,497 | (42,606) |
Net (income) loss attributable to noncontrolling interest | 18 | 11 |
Net income (loss) attributable to Brookdale Senior Living Inc. common stockholders | $ 369,515 | $ (42,595) |
Net income (loss) per share attributable to Brookdale Senior Living Inc. common stockholders: | ||
Basic (in dollars per share) | $ 2.01 | $ (0.23) |
Diluted (in dollars per share) | $ 2 | $ (0.23) |
Weighted average common shares outstanding: | ||
Basic (in shares) | 184,186 | 186,747 |
Diluted (in shares) | 184,522 | 186,747 |
Resident fees | ||
Revenue | ||
Revenue | $ 782,707 | $ 809,479 |
Management fees | ||
Revenue | ||
Revenue | 108,715 | 15,743 |
Reimbursed costs incurred on behalf of managed communities | ||
Revenue | ||
Revenue | 122,717 | 216,822 |
Expense | ||
Costs of services | 122,717 | 216,822 |
Facility operating expense | ||
Expense | ||
Costs of services | $ 588,482 | $ 586,094 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Depreciation and amortization | $ 84,301 | $ 88,827 |
Non-cash stock-based compensation expense | $ 5,957 | $ 6,356 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In- Capital | Treasury Stock | Accumulated Deficit | Noncontrolling Interest | Cumulative Effect Period Of Adoption AdjustmentAccumulated Deficit |
Balances at beginning of period at Dec. 31, 2018 | $ 1,018,413 | $ 1,968 | $ 4,151,147 | $ (64,940) | $ (3,069,272) | $ (490) | $ (55,885) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (42,606) | (42,595) | (11) | ||||
Compensation expense related to restricted stock grants | 6,356 | ||||||
Issuance of common stock under Associate Stock Purchase Plan | 1 | 298 | |||||
Restricted stock, net | 35 | (35) | |||||
Shares withheld for employee taxes | (4) | (2,993) | |||||
Purchase of treasury stock | (6,000) | ||||||
Other, net | 17 | ||||||
Balances at end of period at Mar. 31, 2019 | 917,597 | $ 2,000 | 4,154,790 | (70,940) | (3,167,752) | (501) | |
Balances at beginning of period (in shares) at Dec. 31, 2018 | 192,356,000 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock under Associate Stock Purchase Plan (in shares) | 50,000 | ||||||
Restricted stock grants, net (in shares) | 3,534,000 | ||||||
Shares withheld for employee taxes (in shares) | (434,000) | ||||||
Purchase of treasury stock (in shares) | (933,000) | ||||||
Balances at end of period (in shares) at Mar. 31, 2019 | 194,573,000 | ||||||
Balances at beginning of period at Dec. 31, 2019 | 698,725 | $ 1,996 | 4,172,099 | (84,651) | (3,393,088) | 2,369 | $ (115) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 369,497 | 369,515 | (18) | ||||
Compensation expense related to restricted stock grants | 5,957 | ||||||
Issuance of common stock under Associate Stock Purchase Plan | 1 | 168 | |||||
Restricted stock, net | (6) | 6 | |||||
Shares withheld for employee taxes | (6) | (3,892) | |||||
Purchase of treasury stock | (18,123) | ||||||
Other, net | 18 | ||||||
Balances at end of period at Mar. 31, 2020 | $ 1,052,230 | $ 1,985 | $ 4,174,356 | $ (102,774) | $ (3,023,688) | $ 2,351 | |
Balances at beginning of period (in shares) at Dec. 31, 2019 | 192,128,586 | 192,129,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock under Associate Stock Purchase Plan (in shares) | 61,000 | ||||||
Restricted stock grants, net (in shares) | (504,000) | ||||||
Shares withheld for employee taxes (in shares) | (611,000) | ||||||
Purchase of treasury stock (in shares) | (3,063,000) | ||||||
Balances at end of period (in shares) at Mar. 31, 2020 | 188,012,169 | 188,012,000 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows from Operating Activities | ||
Net income (loss) | $ 369,497 | $ (42,606) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Loss (gain) on debt modification and extinguishment, net | (19,181) | 67 |
Depreciation and amortization, net | 92,053 | 97,867 |
Asset impairment | 78,226 | 391 |
Equity in (earnings) loss of unconsolidated ventures | 1,008 | 526 |
Distributions from unconsolidated ventures from cumulative share of net earnings | 0 | 749 |
Amortization of entrance fees | (377) | (398) |
Proceeds from deferred entrance fee revenue | 343 | 436 |
Deferred income tax (benefit) provision | (21,767) | 170 |
Operating lease expense adjustment | (6,733) | (4,383) |
Loss (gain) on sale of assets, net | (372,839) | 702 |
Loss (gain) on facility lease termination and modification, net | 0 | 209 |
Non-cash stock-based compensation expense | 5,957 | 6,356 |
Non-cash management contract termination gain | 0 | (353) |
Other | (1,460) | (2,495) |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (2,033) | (4,550) |
Prepaid expenses and other assets, net | (1,696) | 12,358 |
Prepaid insurance premiums financed with notes payable | (17,434) | (18,842) |
Trade accounts payable and accrued expenses | (47,919) | (41,358) |
Refundable fees and deferred revenue | (2,254) | (9,855) |
Operating lease assets and liabilities for lessor capital expenditure reimbursements | 4,088 | 0 |
Net cash provided by (used in) operating activities | 57,479 | (5,009) |
Cash Flows from Investing Activities | ||
Change in lease security deposits and lease acquisition deposits, net | 3,211 | (320) |
Purchase of marketable securities | (89,414) | (68,348) |
Sale and maturities of marketable securities | 50,000 | 0 |
Capital expenditures, net of related payables | (69,385) | (60,055) |
Acquisition of assets, net of related payables and cash received | 446,688 | 0 |
Investment in unconsolidated ventures | (268) | (3,986) |
Distributions received from unconsolidated ventures | 0 | 3,178 |
Proceeds from sale of assets, net | 304,617 | 29,458 |
Net cash provided by (used in) investing activities | (247,927) | (100,073) |
Cash Flows from Financing Activities | ||
Proceeds from debt | 471,785 | 25,178 |
Repayment of debt and financing lease obligations | (263,226) | (28,400) |
Proceeds from line of credit | 166,381 | 0 |
Purchase of treasury stock, net of related payables | (18,123) | (9,956) |
Payment of financing costs, net of related payables | (5,815) | (759) |
Payments of employee taxes for withheld shares | (3,898) | (2,997) |
Other | 146 | 298 |
Net cash provided by (used in) financing activities | 347,250 | (16,636) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 156,802 | (121,718) |
Cash, cash equivalents, and restricted cash at beginning of period | 301,697 | 450,218 |
Cash, cash equivalents, and restricted cash at end of period | $ 458,499 | $ 328,500 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q. In the opinion of management, these financial statements include all adjustments, which are of a normal and recurring nature, necessary to present fairly the financial position, results of operations, and cash flows of the Company for all periods presented. Certain information and footnote disclosures included in annual financial statements have been condensed or omitted. The Company believes that the disclosures included are adequate and provide a fair presentation of interim period results. Interim financial statements are not necessarily indicative of the financial position or operating results for an entire year. These interim financial statements should be read in conjunction with the audited financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on February 19, 2020. Certain prior period amounts have been reclassified to conform to the current financial statement presentation, with no effect on the Company's condensed consolidated financial position or results of operations. Except for the changes for the impact of the recently adopted accounting pronouncements discussed in this Note, the Company has consistently applied its accounting policies to all periods presented in these condensed consolidated financial statements. Principles of Consolidation The condensed consolidated financial statements include the accounts of Brookdale and its consolidated subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. Investments in affiliated companies that the Company does not control, but has the ability to exercise significant influence over governance and operations, are accounted for by the equity method. The ownership interest of consolidated entities not wholly-owned by the Company are presented as noncontrolling interests in the accompanying condensed consolidated financial statements. Noncontrolling interest represents the share of consolidated entities owned by third parties. Noncontrolling interest is adjusted for the noncontrolling holder's share of additional contributions, distributions, and the proportionate share of the net income or loss of each respective entity. Use of Estimates The preparation of the consolidated financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, revenue, asset impairments, self-insurance reserves, performance-based compensation, the allowance for credit losses, depreciation and amortization, leasing transactions, income taxes, and other contingencies. Although these estimates are based on management's best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from the original estimates. Lease Accounting The Company, as lessee, recognizes a right-of-use asset and a lease liability on the Company's consolidated balance sheet for its community, office, and equipment leases. As of the commencement date of a lease, a lease liability and corresponding right-of-use asset is established on the Company's consolidated balance sheet at the present value of future minimum lease payments. The Company's community leases generally contain fixed annual rent escalators or annual rent escalators based on an index, such as the consumer price index. The future minimum lease payments recognized on the consolidated balance sheet include fixed payments (including in-substance fixed payments) and variable payments estimated utilizing the index or rate on the lease commencement date. The Company recognizes lease expense as incurred for additional variable payments. For the Company's leases that do not contain an implicit rate, the Company utilizes its estimated incremental borrowing rate to determine the present value of lease payments based on information available at commencement of the lease. The Company's estimated incremental borrowing rate reflects the fixed rate at which the Company could borrow a similar amount for the same term on a collateralized basis. The Company elected the short-term lease exception policy which permits leases with an initial term of 12 months or less to not be recorded on the Company's consolidated balance sheet and instead to be recognized as lease expense as incurred. The Company, as lessee, makes a determination with respect to each of its community, office, and equipment leases as to whether each should be accounted for as an operating lease or financing lease. The classification criteria is based on estimates regarding the fair value of the leased asset, minimum lease payments, effective cost of funds, economic life of the asset, and certain other terms in the lease agreements. Lease right-of-use assets are reviewed for impairment whenever changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of right-of-use assets are assessed by a comparison of the carrying amount of the asset to the estimated future undiscounted net cash flows expected to be generated by the asset, calculated utilizing the lowest level of identifiable cash flows. If estimated future undiscounted net cash flows are less than the carrying amount of the asset then the fair value of the asset is estimated. The impairment expense is determined by comparing the estimated fair value of the asset to its carrying amount, with any amount in excess of fair value recognized as an expense in the current period. Undiscounted cash flow projections and estimates of fair value amounts are based on a number of assumptions such as revenue and expense growth rates and estimated lease coverage ratios (Level 3). Operating Leases The Company recognizes operating lease expense for actual rent paid, generally plus or minus a straight-line adjustment for estimated minimum lease escalators if applicable. The right-of-use asset is generally reduced each period by an amount equal to the difference between the operating lease expense and the amount of expense on the lease liability utilizing the effective interest method. Subsequent to the impairment of an operating lease right-of-use asset, the Company recognizes operating lease expense consisting of the reduction of the right-of-use asset on a straight-line basis over the remaining lease term and the amount of expense on the lease liability utilizing the effective interest method. Financing Leases Financing lease right-of-use assets are recognized within property, plant and equipment and leasehold intangibles, net on the Company's consolidated balance sheets. The Company recognizes interest expense on the financing lease liabilities utilizing the effective interest method. The right-of-use asset is generally amortized to depreciation and amortization expense on a straight-line basis over the lease term unless the lease contains an option to purchase the underlying asset that the Company is reasonably certain to exercise. If the Company is reasonably certain to exercise the purchase option, the asset is amortized over the useful life. Sale-Leaseback Transactions For transactions in which an owned community is sold and leased back from the buyer (sale-leaseback transactions), the Company recognizes an asset sale and lease accounting is applied if the Company has transferred control of the community. For such transactions, the Company removes the transferred assets from the consolidated balance sheet and a gain or loss on the sale is recognized for the difference between the carrying amount of the asset and the transaction price for the sale transaction. For sale‑leaseback transactions in which the Company has not transferred control of the underlying asset, the Company does not recognize an asset sale or derecognize the underlying asset until control is transferred. For such transactions, the Company continues to recognize the assets within property, plant and equipment and leasehold intangibles, net and continues to depreciate the asset over its useful life. Additionally, the Company accounts for any amounts received as a financing lease liability and the Company recognizes interest expense on the financing lease liability utilizing the effective interest method with the interest expense limited to an amount that is not greater than the cash payments on the financing lease liability over the term of the lease. Gain (Loss) on Sale of Assets The Company regularly enters into real estate transactions which may include the disposal of certain communities, including the associated real estate. The Company recognizes gain or loss from real estate sales when the transfer of control is complete. The Company recognizes gain or loss from the sale of equity method investments when the transfer of control is complete and the Company has no continuing involvement with the transferred financial assets. Property, Plant and Equipment and Leasehold Intangibles, Net Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset group may not be recoverable. Recoverability of an asset group is assessed by comparing its carrying amount to the estimated future undiscounted net cash flows expected to be generated by the asset group through operation or disposition, calculated utilizing the lowest level of identifiable cash flows. If this comparison indicates that the carrying amount of an asset group is not recoverable, the Company is required to recognize an impairment loss. The impairment loss is measured by the amount by which the carrying amount of the asset exceeds its estimated fair value, with any amount in excess of fair value recognized as an expense in the current period. Undiscounted cash flow projections and estimates of fair value amounts are based on a number of assumptions such as revenue and expense growth rates, estimated holding periods, and estimated capitalization rates (Level 3). Goodwill The Company tests goodwill for impairment annually during the fourth quarter or more frequently if indicators of impairment arise. Factors the Company considers important in its analysis of whether an indicator of impairment exists include a significant decline in the Company's stock price or market capitalization for a sustained period since the last testing date, significant underperformance relative to historical or projected future operating results, and significant negative industry or economic trends. The Company first assesses qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If so, the Company performs a quantitative goodwill impairment test based upon a comparison of the estimated fair value of the reporting unit to which the goodwill has been assigned with the reporting unit's carrying amount. The fair values used in the quantitative goodwill impairment test are estimated using Level 3 inputs based upon discounted future cash flow projections for the reporting unit. These cash flow projections are based upon a number of estimates and assumptions such as revenue and expense growth rates, capitalization rates, and discount rates. The Company also considers market-based measures such as earnings multiples in its analysis of estimated fair values of its reporting units. If the quantitative goodwill impairment test results in a reporting unit's carrying amount exceeding its estimated fair value, an impairment charge will be recorded based on the difference, with the impairment charge limited to the amount of goodwill allocated to the reporting unit. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 replaces the current incurred loss impairment methodology for credit losses with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The Company adopted this standard effective January 1, 2020 and recognized the cumulative effect of the adoption as an immaterial adjustment to beginning accumulated deficit as of January 1, 2020 for the cumulative effect of adopting ASU 2016-13. In February 2016, the FASB issued ASU 2016-02, Leases ("ASU 2016-02"), which amends the former accounting principles for the recognition, measurement, presentation, and disclosure of leases for both lessees and lessors. The Company adopted these lease accounting standards effective January 1, 2019 and recognized the cumulative effect of the adoption as a $55.9 million adjustment to beginning accumulated deficit as of January 1, 2019. See Footnote 2, Summary of Significant Accounting Policies, in our Annual Report on Form 10-K for the year ended December 31, 2019 for more details regarding the adoption of this accounting pronouncement. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share ("EPS") is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding. Diluted EPS includes the components of basic EPS and also gives effect to dilutive common stock equivalents. Under the treasury stock method, diluted EPS reflects the potential dilution that could occur if securities or other instruments that are convertible into common stock were exercised or could result in the issuance of common stock. Potentially dilutive common stock equivalents include unvested restricted stock and restricted stock units. The following table summarizes the computation of basic and diluted earnings (loss) per share amounts presented in the condensed consolidated statements of operations: Three Months Ended March 31, 2020 2019 Income attributable to common shareholders: Net income (loss) $ 369,515 $ (42,595 ) Weighted average shares outstanding - basic 184,186 186,747 Effect of dilutive securities - Unvested restricted stock and restricted stock units 336 — Weighted average shares outstanding - diluted 184,522 186,747 Basic earnings (loss) per common share: Net income (loss) per share attributable to common shareholders $ 2.01 $ (0.23 ) Diluted earnings (loss) per common share: Net income (loss) per share attributable to common shareholders $ 2.00 $ (0.23 ) The calculation of diluted weighted average shares for the three months ended March 31, 2020 excludes 6.9 million of non-performance-based restricted shares and restricted stock units, as the inclusion of such awards would have been anti-dilutive for the period. Performance-based equity awards are included in the diluted earnings per share calculation based on the attainment of the applicable performance metrics to date. For the three months ended March 31, 2020 , the calculation of diluted weighted average shares excludes 1.8 million of performance-based restricted shares and restricted stock units. During the three months ended March 31, 2019 , the Company reported a consolidated net loss. As a result of the net loss, unvested restricted stock and restricted stock units were antidilutive for the period and were not included in the computation of diluted weighted average shares. The weighted average restricted stock and restricted stock units excluded from the calculations of diluted net loss per share was 7.2 million for the three months ended March 31, 2019 |
Acquisitions, Dispositions and
Acquisitions, Dispositions and Other Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisitions, Dispositions and Other Transactions | Acquisitions, Dispositions and Other Transactions During the period from January 1, 2019 through March 31, 2020 , the Company acquired 26 communities that the Company previously leased, disposed of 15 owned communities, and sold its ownership interest in its unconsolidated entry fee CCRC Venture (the "CCRC Venture") with Healthpeak Properties, Inc. ("Healthpeak"), and the Company's triple-net lease obligations on eleven communities were terminated. The acquisitions of formerly leased communities include the 18 communities acquired from Healthpeak described below and eight communities acquired pursuant to the exercise of a purchase option for a purchase price of $39.3 million , all of which occurred during the three months ended March 31, 2020 . As of March 31, 2020 , the Company owned 355 communities, leased 306 communities, managed 80 communities, and two unencumbered communities in the CCRCs segment were classified as held for sale, resulting in $37.4 million being recorded as assets held for sale. The closings of the various pending and expected transactions described within this note are, or will be, subject to the satisfaction of various closing conditions, including (where applicable) the receipt of regulatory approvals. However, there can be no assurance that the transactions will close or, if they do, when the actual closings will occur. Dispositions of Owned Communities During the three months ended March 31, 2020 , the Company completed the sale of one owned community for cash proceeds of $5.5 million , net of transaction costs, and recognized a net gain on sale of assets of $0.2 million . During the year ended December 31, 2019 , the Company completed the sale of 14 owned communities for cash proceeds of $85.4 million , net of transaction costs, and recognized a net gain on sale of assets of $5.5 million . The Company utilized a portion of the cash proceeds from the asset sales to repay approximately $5.1 million of associated mortgage debt and debt prepayment penalties. These dispositions included the sale of six communities during the three months ended March 31, 2019 for which the Company received cash proceeds of $29.5 million , net of transaction costs. Healthpeak CCRC Venture and Master Lease Transactions On October 1, 2019, the Company entered into definitive agreements, including a Master Transactions and Cooperation Agreement (the "MTCA") and an Equity Interest Purchase Agreement (the "Purchase Agreement"), providing for a multi-part transaction with Healthpeak. The parties subsequently amended the agreements to include one additional entry fee CCRC community as part of the sale of the Company's interest in the CCRC Venture. The components of the multi-part transaction include: • CCRC Venture Transaction. Pursuant to the Purchase Agreement, on January 31, 2020, Healthpeak acquired the Company's 51% ownership interest in the CCRC Venture, which held 14 entry fee CCRCs, for a total purchase price of $295.2 million (representing an aggregate valuation of $1.06 billion less portfolio debt, subject to a net working capital adjustment), which remains subject to a post-closing net working capital adjustment. The Company recognized a $370.7 million gain on sale of assets for the three months ended March 31, 2020, and the Company derecognized the net equity method liability for the sale of the ownership interest in the CCRC Venture. At the closing, the parties terminated the Company's existing management agreements with the 14 entry fee CCRCs, Healthpeak paid the Company a $100.0 million management agreement termination fee, and the Company transitioned operations of the entry fee CCRCs to a new operator. The Company recognized $100.0 million of management fee revenue for the three months ended March 31, 2020 for the management termination fee. Prior to the January 31, 2020 closing, the parties moved the remaining two entry fee CCRCs into a new unconsolidated venture on substantially the same terms as the CCRC Venture to accommodate the sale of such two communities expected to occur in 2021. Subsequent to these transactions, the Company will have exited substantially all of its entry fee CCRC operations. • Master Lease Transactions. Pursuant to the MTCA, on January 31, 2020, the parties amended and restated the existing master lease pursuant to which the Company continues to lease 25 communities from Healthpeak, and the Company acquired 18 formerly leased communities from Healthpeak, at which time the 18 communities were removed from the master lease. At the closing, the Company paid $405.5 million to acquire such communities and to reduce its annual rent under the amended and restated master lease. The Company funded the community acquisitions with $192.6 million of non-recourse mortgage financing and the proceeds from the multi-part transaction. In addition, Healthpeak has agreed to transition one leased community to a successor operator at a future date. With respect to the continuing 24 communities, the Company's amended and restated master lease: (i) has an initial term to expire on December 31, 2027, subject to two extension options at the Company's election for ten years each, which must be exercised with respect to the entire pool of leased communities; (ii) the initial annual base rent for the 24 communities is $41.7 million and is subject to an escalator of 2.4% per annum on April 1st of each year; and (iii) Healthpeak has agreed to make available up to $35 million for capital expenditures for a five-year period related to the 24 communities at an initial lease rate of 7.0% . As a result of the community acquisition transaction, the Company recognized a $19.7 million gain on debt extinguishment and derecognized the $105.1 million carrying amount of financing lease obligations for eight communities which were previously subject to sale-leaseback transactions in which the Company was deemed to have continuing involvement. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Marketable Securities As of March 31, 2020 , marketable securities of $108.0 million are stated at fair value based on valuation provided by third-party pricing services and are classified within Level 2 of the valuation hierarchy. Debt The Company had outstanding long-term debt obligations, including $166.4 million of borrowings outstanding on the revolving credit facility, as of March 31, 2020, with a carrying value of $3.9 billion as of March 31, 2020 and $3.6 billion as of December 31, 2019 . Fair value of the long-term debt approximates carrying value in all periods presented. The Company's fair value of long-term debt disclosure is classified within Level 2 of the valuation hierarchy. Asset Impairment Expense The following is a summary of asset impairment expense. Three Months Ended (in millions) 2020 2019 Property, plant and equipment and leasehold intangibles, net $ 11.0 $ — Operating lease right-of-use assets 65.7 — Investment in unconsolidated ventures 1.5 — Other assets, net — 0.4 Asset impairment $ 78.2 $ 0.4 Although the Company cannot predict with reasonable certainty the ultimate impacts of the pandemic caused by coronavirus disease 2019 ("COVID-19"), the Company concluded that the impacts of the pandemic have adversely affected the Company’s projections of revenue, expense, and cash flow for its senior housing community long-lived assets and constitute an indicator of potential impairment. Refer to Note 16 for additional information on the COVID-19 pandemic. Accordingly, the Company assessed its long-lived assets for recoverability. In estimating the recoverability of asset groups for purposes of the Company’s long-lived asset impairment testing during the three months ended March 31, 2020, the Company utilized future cash flow projections that are generally developed internally. Any estimates of future cash flow projections necessarily involve predicting unknown future circumstances and events and require significant management judgments and estimates. In arriving at the cash flow projections, the Company considers its estimates of the impacts of the pandemic, historic operating results, approved budgets and business plans, future demographic factors, expected growth rates, estimated asset holding periods, and other factors. As of March 31, 2020, there was a wide range of possible outcomes as a result of the pandemic, as there was a high degree of uncertainty about its ultimate impacts. Management’s estimates of the impacts of the pandemic are highly dependent on variables that are difficult to predict, including the duration, severity, and geographic concentrations of the pandemic and any resurgence of the disease, the duration and degree to which visitors are restricted from the Company's communities, the effect of the pandemic on the demand for senior living communities, the degree to which the Company may receive government financial relief and the timing thereof, and the duration and costs of the Company’s response efforts. Future events may indicate differences from management's current judgments and estimates which could, in turn, result in future impairments. Operating Lease Right-of-Use Assets As a result of the COVID-19 pandemic during the three months ended March 31, 2020, the Company evaluated operating lease right-of-use assets for impairment and identified communities with a carrying amount of the assets in excess of the estimated future undiscounted net cash flows expected to be generated by the assets. The Company compared the estimated fair value of the assets to their carrying amount for these identified communities and recorded an impairment charge for the excess of carrying amount over fair value. As a result, the Company recognized the right-of-use assets for the operating leases for 35 communities on the condensed consolidated balance sheet as of March 31, 2020 at the estimated fair value of $106.7 million . The Company recorded a non-cash impairment charge in its operating results of $65.7 million for the three months ended March 31, 2020 to operating lease right-of-use assets, of which $31.3 million was within the Independent Living segment, $22.2 million was within the Assisted Living and Memory Care segment, and $12.2 million was within the CCRC segment. The fair values of the operating lease right-of-use assets of these communities were estimated utilizing a discounted cash flow approach based upon historical and projected community cash flows and market data, including management fees and a market supported lease coverage ratio, all of which are considered Level 3 inputs within the valuation hierarchy. The estimated future cash flows were discounted at a rate that is consistent with a weighted average cost of capital from a market participant perspective. The range of discount rates utilized was 11.2% to 12.3% , depending upon the property type, geographical location, and the quality of the respective community. These impairment charges are primarily due to the COVID-19 pandemic and lower than expected operating performance at these communities and reflect the amount by which the carrying amounts of the assets exceeded their estimated fair value. Property, Plant and Equipment and Leasehold Intangibles, Net During the three months ended March 31, 2020, the Company evaluated property, plant and equipment and leasehold intangibles for impairment and identified communities with a carrying amount of the assets in excess of the estimated future undiscounted net cash flows expected to be generated by the assets. The Company compared the estimated fair value of the assets to their carrying amount for these identified communities and recorded an impairment charge for the excess of carrying amount over fair value. The Company recorded property, plant and equipment and leasehold intangibles non-cash impairment charges in its operating results of $11.0 million for the three months ended March 31, 2020, primarily within the Assisted Living and Memory Care segment. The fair values of the property, plant and equipment of these communities were primarily determined utilizing a discounted cash flow approach considering stabilized facility operating income and market capitalization rates. These fair value measurements are considered Level 3 measurements within the valuation hierarchy. These impairment charges are primarily due to the COVID-19 pandemic and lower than expected operating performance at these communities and reflect the amount by which the carrying amounts of the assets exceeded their estimated fair value. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Grants of restricted stock units and stock awards under the Company's 2014 Omnibus Incentive Plan were as follows: (in thousands, except for per share and unit amounts) Restricted Stock Units and Stock Awards Granted Weighted Average Grant Date Fair Value Total Value Three months ended March 31, 2020 4,438 $ 7.06 $ 31,341 |
Goodwill
Goodwill | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The Company's Independent Living and Health Care Services segments had a carrying value of goodwill of $27.3 million and $126.8 million , respectively, as of both March 31, 2020 and December 31, 2019 . Goodwill is tested for impairment annually with a test date of October 1 and sooner if indicators of impairment are present. Factors the Company considers important in its analysis, which could trigger an impairment of such assets, include significant underperformance relative to historical or projected future operating results, significant negative industry or economic trends, and a significant decline in the Company's stock price and market capitalization for a sustained period. During the three months ended March 31, 2020 , the Company identified qualitative indicators of impairment of goodwill, including the COVID-19 pandemic and a significant decline in the Company's stock price and market capitalization for a sustained period during the three months ended March 31, 2020 . The pandemic and related infection prevention and control protocols within senior living communities have significantly disrupted demand for senior living communities and the sales process, which typically includes in-person prospective resident visits at communities. The Company believes potential residents and their families are more cautious regarding moving into senior living communities while the pandemic continues, and such caution may persist for some time. The Company cannot predict with reasonable certainty whether or when demand for senior living communities will return to pre-COVID-19 levels or the extent to which the pandemic’s effect on demand may adversely affect the amount of resident fees it is able to collect from its residents. Refer to Note 16 for additional information on the COVID-19 pandemic. As a result of the COVID-19 pandemic, the Company performed an interim quantitative goodwill impairment test as of March 31, 2020 . The Company’s quantitative goodwill impairment test as of March 31, 2020 included reduced estimates of projected future cash flows as a result of changes to significant assumptions using information known or knowable about the COVID-19 pandemic, including current industry and economic trends, changes in business plans, and changes in expected revenue and facility operating expense growth rates. Additionally, the Company considered the additional risk within the future cash flow estimates when selecting risk-adjusted discount rates. The Company determined no impairment was necessary for the three months ended March 31, 2020 . Determining the fair value of the Company’s reporting units involves the use of significant estimates and assumptions that are unpredictable and inherently uncertain. These estimates and assumptions include revenue and expense growth rates and operating margins used to calculate projected future cash flows and risk-adjusted discount rates. Future events may indicate differences from management's current judgments and estimates which could, in turn, result in future impairments. Future events that may result in impairment charges include differences in the projected occupancy rates or monthly service fee rates, changes in the cost structure of existing communities, changes in reimbursement rates from Medicare for healthcare services, and changes in healthcare reform. Significant adverse changes in the Company’s future revenues and/or operating margins, significant changes in the market for senior housing or the valuation of the real estate of senior living communities, as well as other events and circumstances, including but not limited to increased competition, changes in reimbursement rates from Medicare for healthcare services, and changing economic or market conditions, including market control premiums, could result in changes in fair value and the determination that goodwill is impaired. |
Property, Plant and Equipment a
Property, Plant and Equipment and Leasehold Intangibles, Net | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment and Leasehold Intangibles, Net | Property, Plant and Equipment and Leasehold Intangibles, Net As of March 31, 2020 and December 31, 2019 , net property, plant and equipment and leasehold intangibles, which include assets under financing leases, consisted of the following: (in thousands) March 31, 2020 December 31, 2019 Land $ 508,274 $ 450,894 Buildings and improvements 5,236,408 4,790,769 Furniture and equipment 926,094 859,849 Resident and leasehold operating intangibles 317,048 317,111 Construction in progress 71,923 80,729 Assets under financing leases and leasehold improvements 1,523,689 1,847,493 Property, plant and equipment and leasehold intangibles 8,583,436 8,346,845 Accumulated depreciation and amortization (3,284,526 ) (3,237,011 ) Property, plant and equipment and leasehold intangibles, net $ 5,298,910 $ 5,109,834 Assets under financing leases and leasehold improvements includes $0.4 billion and $0.6 billion of financing lease right-of-use assets, net of accumulated amortization, as of March 31, 2020 and December 31, 2019 , respectively. Refer to Note 10 for further information on the Company's financing leases. The Company recognized depreciation and amortization expense on its property, plant and equipment and leasehold intangibles of $90.7 million and $96.1 million for the three months ended March 31, 2020 and 2019 , respectively. Long-lived assets with definite useful lives are depreciated or amortized on a straight-line basis over their estimated useful lives (or, in certain cases, the shorter of their estimated useful lives or the lease term) and are tested for impairment whenever indicators of impairment arise. Refer to Note 5 for additional information on impairment expense for property, plant and equipment and leasehold intangibles. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt Long-term debt as of March 31, 2020 and December 31, 2019 consists of the following: (in thousands) March 31, 2020 December 31, 2019 Mortgage notes payable due 2020 through 2047; weighted average interest rate of 4.28% for the three months ended March 31, 2020, less debt discount and deferred financing costs of $22.1 million and $17.0 million as of March 31, 2020 and December 31, 2019, respectively (weighted average interest rate of 4.72% in 2019) $ 3,708,677 $ 3,496,735 Other notes payable, weighted average interest rate of 4.10% for the three months ended March 31, 2020 (weighted average interest rate of 5.77% in 2019) and maturity dates ranging from 2020 to 2021 18,879 58,388 Total long-term debt 3,727,556 3,555,123 Current portion 83,014 339,413 Total long-term debt, less current portion $ 3,644,542 $ 3,215,710 Credit Facilities The Company's Fifth Amended and Restated Credit Agreement with Capital One, National Association, as administrative agent, lender and swingline lender and the other lenders from time to time parties thereto (the "Credit Agreement"), provides commitments for a $250 million revolving credit facility with a $60 million sublimit for letters of credit and a $50 million swingline feature. The Company has a one-time right under the Credit Agreement to increase commitments on the revolving credit facility by an additional $100 million , subject to obtaining commitments for the amount of such increase from acceptable lenders. The Credit Agreement provides the Company a one-time right to reduce the amount of the revolving credit commitments, and the Company may terminate the revolving credit facility at any time, in each case without payment of a premium or penalty. The Credit Agreement matures on January 3, 2024. Amounts drawn under the facility bear interest at 90-day LIBOR plus an applicable margin. The applicable margin varies based on the percentage of the total commitment drawn, with a 2.25% margin at utilization equal to or lower than 35% , a 2.75% margin at utilization greater than 35% but less than or equal to 50% , and a 3.25% margin at utilization greater than 50% . A quarterly commitment fee is payable on the unused portion of the facility at 0.25% per annum when the outstanding amount of obligations (including revolving credit and swingline loans and letter of credit obligations) is greater than or equal to 50% of the revolving credit commitment amount or 0.35% per annum when such outstanding amount is less than 50% of the revolving credit commitment amount. The credit facility is secured by first priority mortgages on certain of the Company's communities. In addition, the Credit Agreement permits the Company to pledge the equity interests in subsidiaries that own other communities and grant negative pledges in connection therewith (rather than mortgaging such communities), provided that not more than 10% of the borrowing base may result from communities subject to negative pledges. Availability under the revolving credit facility will vary from time to time based on borrowing base calculations related to the appraised value and performance of the communities securing the credit facility and the Company's consolidated fixed charge coverage ratio. To the extent the outstanding borrowings on the credit facility exceed future borrowing base calculations, the Company would be required to repay the difference to restore the outstanding balance to the new borrowing base. During 2019, parties entered into an amendment to the Credit Agreement that provides for availability calculations to be made at additional consolidated fixed charge coverage ratio thresholds. The Credit Agreement contains typical affirmative and negative covenants, including financial covenants with respect to minimum consolidated fixed charge coverage and minimum consolidated tangible net worth. Amounts drawn on the credit facility may be used for general corporate purposes. As of March 31, 2020 , $166.4 million of borrowings were outstanding on the revolving credit facility, $48.1 million of letters of credit were outstanding, and the revolving credit facility had $35.3 million of availability. The Company also had a separate unsecured letter of credit facility of up to $50.0 million of letters of credit as of March 31, 2020 under which $47.5 million had been issued as of that date. Financings During March 2020, the Company completed its financing plans in the regular course of business, including closing non-recourse mortgage debt financing transactions as described below. As of March 31, 2020 , the Company’s remaining 2020 and 2021 maturities are $69.7 million and $333.1 million , respectively, and the Company has commenced efforts to refinance those and other maturities with non-recourse mortgage debt. There is no assurance that debt financing will continue to be available on terms consistent with the Company’s expectations or at all. On January 31, 2020, the Company obtained $238.2 million of debt secured by the non-recourse first mortgages on 14 communities, including $192.6 million of non-recourse first mortgage financing on 13 communities acquired from Healthpeak on such date. Seventy percent of the principal amount bears interest at a fixed rate of 3.62% , and the remaining thirty percent of the principal amount bears interest at a variable rate equal to 30-day LIBOR plus a margin of 209 basis points. The debt matures in February 2030. The proceeds from the financing were utilized to fund the acquisition of communities from Healthpeak and repay $33.1 million of outstanding mortgage debt maturing in 2020. Refer to Note 4 for more information about the Company's acquisition of communities from Healthpeak. On March 19, 2020, the Company obtained $29.2 million of debt secured by the non-recourse first mortgages on seven communities, primarily communities acquired during the three months ended March 31, 2020. The loan bears interest at a variable rate equal to the 30-day LIBOR plus a margin of 225 basis points and matures in April 2030. On March 20, 2020, the Company obtained $30.0 million of debt secured by the non-recourse first mortgage on one community acquired from Healthpeak on January 31, 2020. The loan bears interest at a variable rate equal to the 30-day LIBOR plus a margin of 250 basis points and matures in March 2022. On March 31, 2020, the Company obtained $149.3 million of debt secured by the non-recourse first mortgages on 18 communities. Of the total principal, $73.1 million bears interest at a fixed rate of 3.55% , and the remaining $76.2 million bears interest at a variable rate equal to the 30-day LIBOR plus a margin of 210 basis points. The debt matures in April 2030. The $149.3 million of proceeds from the financing were primarily utilized to repay $136.3 million of outstanding mortgage debt maturing in 2020. Financial Covenants Certain of the Company's debt documents contain restrictions and financial covenants, such as those requiring the Company to maintain prescribed minimum net worth and stockholders' equity levels and debt service ratios, and requiring the Company not to exceed prescribed leverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community, and/or entity basis. In addition, the Company's debt documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements. The Company's failure to comply with applicable covenants could constitute an event of default under the applicable debt documents. Many of the Company's debt documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Furthermore, the Company's debt is secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries. As of March 31, 2020 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases As of March 31, 2020 , the Company operated 306 communities under long-term leases ( 239 operating leases and 67 financing leases). The substantial majority of the Company's lease arrangements are structured as master leases. Under a master lease, numerous communities are leased through an indivisible lease. The Company typically guarantees the performance and lease payment obligations of its subsidiary lessees under the master leases. An event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio. The leases relating to these communities are generally fixed rate leases with annual escalators that are either fixed or based upon changes in the consumer price index or the leased property revenue. The Company is responsible for all operating costs, including repairs, property taxes, and insurance. The leases generally provide for renewal or extension options from 5 to 20 years and in some instances, purchase options. The community leases contain other customary terms, which may include assignment and change of control restrictions, maintenance and capital expenditure obligations, termination provisions and financial covenants, such as those requiring the Company to maintain prescribed minimum net worth and stockholders' equity levels and lease coverage ratios, and not to exceed prescribed leverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community and/or entity basis. In addition, the Company's lease documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements. The Company's failure to comply with applicable covenants could constitute an event of default under the applicable lease documents. Many of the Company's debt and lease documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Certain leases contain cure provisions, which generally allow the Company to post an additional lease security deposit if the required covenant is not met. Furthermore, the Company's leases are secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries. As of March 31, 2020 , the Company is in compliance with the financial covenants of its long-term leases. A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and cash flows from leasing transactions is as follows: Three Months Ended Operating Leases (in thousands) 2020 2019 Facility operating expense $ 4,850 $ 4,625 Facility lease expense 64,481 68,668 Operating lease expense 69,331 73,293 Operating lease expense adjustment (1) 6,733 4,383 Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements (4,088 ) — Operating cash flows from operating leases $ 71,976 $ 77,676 (1) Represents the difference between cash paid and expense recognized. Three Months Ended Financing Leases (in thousands) 2020 2019 Depreciation and amortization $ 9,144 $ 11,678 Interest expense: financing lease obligations 13,282 16,743 Financing lease expense $ 22,426 $ 28,421 Operating cash flows from financing leases $ 13,282 $ 16,743 Financing cash flows from financing leases 5,087 5,453 Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement 1,739 — Total cash flows from financing leases $ 20,108 $ 22,196 The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2020 are as follows (in thousands): Year Ending December 31, Operating Leases Financing Leases 2020 (nine months) $ 226,638 $ 48,958 2021 289,775 65,943 2022 288,988 66,577 2023 290,107 67,334 2024 290,967 68,572 Thereafter 578,896 167,852 Total lease payments 1,965,371 485,236 Purchase option liability and non-cash gain on future sale of property — 411,679 Imputed interest and variable lease payments (508,734 ) (315,354 ) Total lease obligations $ 1,456,637 $ 581,561 |
Leases | Leases As of March 31, 2020 , the Company operated 306 communities under long-term leases ( 239 operating leases and 67 financing leases). The substantial majority of the Company's lease arrangements are structured as master leases. Under a master lease, numerous communities are leased through an indivisible lease. The Company typically guarantees the performance and lease payment obligations of its subsidiary lessees under the master leases. An event of default related to an individual property or limited number of properties within a master lease portfolio may result in a default on the entire master lease portfolio. The leases relating to these communities are generally fixed rate leases with annual escalators that are either fixed or based upon changes in the consumer price index or the leased property revenue. The Company is responsible for all operating costs, including repairs, property taxes, and insurance. The leases generally provide for renewal or extension options from 5 to 20 years and in some instances, purchase options. The community leases contain other customary terms, which may include assignment and change of control restrictions, maintenance and capital expenditure obligations, termination provisions and financial covenants, such as those requiring the Company to maintain prescribed minimum net worth and stockholders' equity levels and lease coverage ratios, and not to exceed prescribed leverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community and/or entity basis. In addition, the Company's lease documents generally contain non-financial covenants, such as those requiring the Company to comply with Medicare or Medicaid provider requirements. The Company's failure to comply with applicable covenants could constitute an event of default under the applicable lease documents. Many of the Company's debt and lease documents contain cross-default provisions so that a default under one of these instruments could cause a default under other debt and lease documents (including documents with other lenders and lessors). Certain leases contain cure provisions, which generally allow the Company to post an additional lease security deposit if the required covenant is not met. Furthermore, the Company's leases are secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries. As of March 31, 2020 , the Company is in compliance with the financial covenants of its long-term leases. A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and cash flows from leasing transactions is as follows: Three Months Ended Operating Leases (in thousands) 2020 2019 Facility operating expense $ 4,850 $ 4,625 Facility lease expense 64,481 68,668 Operating lease expense 69,331 73,293 Operating lease expense adjustment (1) 6,733 4,383 Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements (4,088 ) — Operating cash flows from operating leases $ 71,976 $ 77,676 (1) Represents the difference between cash paid and expense recognized. Three Months Ended Financing Leases (in thousands) 2020 2019 Depreciation and amortization $ 9,144 $ 11,678 Interest expense: financing lease obligations 13,282 16,743 Financing lease expense $ 22,426 $ 28,421 Operating cash flows from financing leases $ 13,282 $ 16,743 Financing cash flows from financing leases 5,087 5,453 Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement 1,739 — Total cash flows from financing leases $ 20,108 $ 22,196 The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2020 are as follows (in thousands): Year Ending December 31, Operating Leases Financing Leases 2020 (nine months) $ 226,638 $ 48,958 2021 289,775 65,943 2022 288,988 66,577 2023 290,107 67,334 2024 290,967 68,572 Thereafter 578,896 167,852 Total lease payments 1,965,371 485,236 Purchase option liability and non-cash gain on future sale of property — 411,679 Imputed interest and variable lease payments (508,734 ) (315,354 ) Total lease obligations $ 1,456,637 $ 581,561 |
Litigation
Litigation | 3 Months Ended |
Mar. 31, 2020 | |
Litigation [Abstract] | |
Litigation | Litigation The Company has been and is currently involved in litigation and claims incidental to the conduct of its business, which it believes are generally comparable to other companies in the senior living and healthcare industries, including, but not limited to, putative class action claims from time to time regarding staffing at the Company’s communities and compliance with consumer protection laws and the Americans with Disabilities Act. Certain claims and lawsuits allege large damage amounts and may require significant costs to defend and resolve. As a result, the Company maintains general liability, professional liability, and other insurance policies in amounts and with coverage and deductibles the Company believes are appropriate, based on the nature and risks of its business, historical experience, availability, and industry standards. The Company's current policies provide for deductibles for each claim and contain various exclusions from coverage. Accordingly, the Company is, in effect, self-insured for claims that are less than the deductible amounts and for claims or portions of claims that are not covered by such policies and/or exceed the policy limits. |
Supplemental Disclosure of Cash
Supplemental Disclosure of Cash Flow Information | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosure of Cash Flow Information | Supplemental Disclosure of Cash Flow Information Three Months Ended (in thousands) 2020 2019 Supplemental Disclosure of Cash Flow Information: Interest paid $ 59,479 $ 62,107 Income taxes paid, net of refunds 957 606 Capital expenditures, net of related payables Capital expenditures - non-development, net $ 60,556 $ 54,602 Capital expenditures - development, net 3,900 5,269 Capital expenditures - non-development - reimbursable 5,827 — Trade accounts payable (898 ) 184 Net cash paid $ 69,385 $ 60,055 Acquisition of communities from Healthpeak Property, plant and equipment and leasehold intangibles, net $ 286,734 $ — Operating lease right-of-use assets (63,285 ) — Financing lease obligations 129,196 — Operating lease obligations 74,335 — Loss (gain) on debt modification and extinguishment, net (19,731 ) — Net cash paid $ 407,249 $ — Acquisition of other assets, net of related payables and cash received: Property, plant and equipment and leasehold intangibles, net $ 179 $ 32,126 Financing lease right-of-use assets 39,260 — Other intangibles assets, net — (4,796 ) Net cash paid $ 39,439 $ 27,330 Proceeds from Sale of CCRC Venture, net Investment in unconsolidated ventures $ (14,848 ) $ — Current portion of long-term debt 34,706 — Accrued expenses (5,025 ) — Other liabilities 60,748 — Loss (gain) on sale of assets, net (370,745 ) — Net cash received $ (295,164 ) $ — Proceeds from sale of other assets, net Prepaid expenses and other assets, net $ (1,261 ) $ (231 ) Assets held for sale (5,274 ) (29,550 ) Property, plant and equipment and leasehold intangibles, net — (457 ) Other liabilities (824 ) 78 Loss (gain) on sale of assets, net (2,094 ) 702 Net cash received $ (9,453 ) $ (29,458 ) Supplemental Schedule of Non-cash Operating, Investing and Financing Purchase of treasury stock: Treasury stock $ — $ 288 Accounts payable — (288 ) Net $ — $ — Assets designated as held for sale: Assets held for sale $ — $ (5,249 ) Property, plant and equipment and leasehold intangibles, net — 5,249 Net $ — $ — Healthpeak master lease modification Property, plant and equipment and leasehold intangibles, net $ (57,462 ) $ — Operating lease right-of-use assets 88,044 — Financing lease obligations 70,874 — Operating lease obligations (101,456 ) — Net $ — $ — Other lease termination and modification, net: Prepaid expenses and other assets, net $ — $ (160 ) Property, plant and equipment and leasehold intangibles, net (9,441 ) 175 Financing lease obligations 9,516 — Other liabilities (75 ) (224 ) Loss (gain) on facility lease termination and modification, net — 209 Net $ — $ — Restricted cash consists principally of escrow deposits for real estate taxes, property insurance, and capital expenditures required by certain lenders under mortgage debt agreements and deposits as security for self-insured retention risk under workers' compensation programs and property insurance programs. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sums to the total of the same such amounts shown in the condensed consolidated statements of cash flows. (in thousands) March 31, 2020 December 31, 2019 Reconciliation of cash, cash equivalents, and restricted cash: Cash and cash equivalents $ 392,674 $ 240,227 Restricted cash 23,908 26,856 Long-term restricted cash 41,917 34,614 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 458,499 $ 301,697 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The difference between the Company's effective tax rate for the three months ended March 31, 2020 and March 31, 2019 was primarily due to the tax impact of the multi-part transaction with Healthpeak that occurred in the three months ended March 31, 2020. The impact represented the tax expense recorded on the gain of the sale of the Company's interest in the CCRC Venture offset by a decrease in the valuation allowance that was a direct result of the multi-part transaction with Healthpeak. This was slightly offset by the adjustment for stock-based compensation, which was greater in the three months ended March 31, 2019 compared to the three months ended March 31, 2020 . The Company recorded an aggregate deferred federal, state, and local tax expense of $90.9 million for the three months ended March 31, 2020 . The expense includes $93.1 million as a result of the gain on the sale of the Company's interest in the CCRC Venture offset by a benefit of $2.2 million as a result of the operating losses (exclusive of the CCRC Venture sale) for the three months ended March 31, 2020 . The expense for the three months ended March 31, 2020 is offset by a reduction in the valuation allowance of $112.6 million . The Company recorded an aggregate deferred federal, state, and local tax benefit of $6.5 million of which $8.2 million was a result of the operating loss for the three months ended March 31, 2019 . The benefit was reduced by $1.7 million reduction in the deferred tax asset related to employee stock compensation. The benefit for the three months ended March 31, 2019 is offset by an increase in the valuation allowance of $6.6 million . The Company evaluates its deferred tax assets each quarter to determine if a valuation allowance is required based on whether it is more likely than not that some portion of the deferred tax asset would not be realized. The Company's valuation allowance as of March 31, 2020 and December 31, 2019 was $296.3 million and $408.9 million , respectively. The change in the valuation allowance for the three months ended March 31, 2020 is primarily the result of a reduction in the Company’s valuation allowance of $117.6 million as a result of the Healthpeak transaction offset by the anticipated reversal of future tax liabilities offset by future tax deductions. The increase in the valuation allowance during the three months ended March 31, 2019 was comprised of multiple components. The increase includes $13.8 million resulting from the adoption of Accounting Standards Codification ("ASC") 842, Leases ("ASC 842") recorded to equity. An additional $8.3 million of allowance was established against the current operating loss incurred during the three months ended March 31, 2019. Offsetting the increases was a decrease of $1.7 million of allowance as a result of removal of future timing differences related to employee stock compensation recorded in the three months ended March 31, 2019. The Company recorded interest charges related to its tax contingency reserve for cash tax positions for the three months ended March 31, 2020 and 2019 which are included in income tax expense or benefit for the period. As of March 31, 2020 , tax returns for years 2015 through 2018 |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of Revenue The Company disaggregates its revenue from contracts with customers by payor source, as the Company believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors. See details on a reportable segment basis in the tables below. Three Months Ended March 31, 2020 (in thousands) Independent Living Assisted Living and Memory Care CCRCs Health Care Services Total Private pay $ 135,290 $ 440,613 $ 64,703 $ 170 $ 640,776 Government reimbursement 572 16,866 19,405 73,689 110,532 Other third-party payor programs — — 10,439 20,960 31,399 Total resident fee revenue $ 135,862 $ 457,479 $ 94,547 $ 94,819 $ 782,707 Three Months Ended March 31, 2019 (in thousands) Independent Living Assisted Living and Memory Care CCRCs Health Care Services Total Private pay $ 135,045 $ 441,911 $ 71,533 $ 190 $ 648,679 Government reimbursement 649 16,615 21,487 88,657 127,408 Other third-party payor programs — — 10,707 22,685 33,392 Total resident fee revenue $ 135,694 $ 458,526 $ 103,727 $ 111,532 $ 809,479 The Company has not further disaggregated management fee revenues and revenue for reimbursed costs incurred on behalf of managed communities as the economic factors affecting the nature, timing, amount, and uncertainty of revenue and cash flows do not significantly vary within each respective revenue category. Contract Balances The payment terms and conditions within the Company's revenue-generating contracts vary by contract type and payor source, although terms generally include payment to be made within 30 days. Resident fee revenue for recurring and routine monthly services is generally billed monthly in advance under the Company's independent living, assisted living, and memory care residency agreements. Resident fee revenue for standalone or certain health care services is generally billed monthly in arrears. Additionally, non-refundable community fees are generally billed and collected in advance or upon move-in of a resident under the Company's independent living, assisted living, and memory care residency agreements. Amounts of revenue that are collected from residents in advance are recognized as deferred revenue until the performance obligations are satisfied. The Company had total deferred revenue (included within refundable fees and deferred revenue, and other liabilities within the condensed consolidated balance sheets) of $72.1 million and $72.5 million , including $39.8 million and $38.9 million of monthly resident fees billed and received in advance, as of March 31, 2020 and December 31, 2019 , respectively. For the three months ended March 31, 2020 and 2019 , the Company recognized $48.3 million and $61.7 million , respectively, of revenue that was included in the deferred revenue balance as of January 1, 2020 and 2019. The Company applies the practical expedient in ASC 606-10-50-14 and does not disclose amounts for remaining performance obligations that have original expected durations of one year or less. For the three months ended March 31, 2020 and 2019 , the Company recognized $4.0 million and $3.5 million , respectively, of charges within facility operating expense within the condensed consolidated statements of operations for additions to the allowance for credit losses. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company has five reportable segments: Independent Living; Assisted Living and Memory Care; CCRCs; Health Care Services; and Management Services. Operating segments are defined as components of an enterprise that engage in business activities from which it may earn revenues and incur expenses; for which separate financial information is available; and whose operating results are regularly reviewed by the chief operating decision maker to assess the performance of the individual segment and make decisions about resources to be allocated to the segment. Independent Living . The Company's Independent Living segment includes owned or leased communities that are primarily designed for middle to upper income seniors who desire an upscale residential environment providing the highest quality of service. The majority of the Company's independent living communities consist of both independent and assisted living units in a single community, which allows residents to age-in-place by providing them with a continuum of senior independent and assisted living services. Assisted Living and Memory Care. The Company's Assisted Living and Memory Care segment includes owned or leased communities that offer housing and 24-hour assistance with activities of daily life to mid-acuity frail and elderly residents. Assisted living and memory care communities include both freestanding, multi-story communities and freestanding, single story communities. The Company also provides memory care services at freestanding memory care communities that are specially designed for residents with Alzheimer's disease and other dementias. CCRCs. The Company's CCRCs segment includes large owned or leased communities that offer a variety of living arrangements and services to accommodate all levels of physical ability and health. Most of the Company's CCRCs have independent living, assisted living, and skilled nursing available on one campus or within the immediate market, and some also include memory care services. Health Care Services . The Company's Health Care Services segment includes the home health, hospice, and outpatient therapy services, as well as education and wellness programs, provided to residents of many of the Company's communities and to seniors living outside of the Company's communities. The Health Care Services segment does not include the skilled nursing and inpatient healthcare services provided in the Company's skilled nursing units, which are included in the Company's CCRCs segment. Management Services. The Company's Management Services segment includes communities operated by the Company pursuant to management agreements. In some of the cases, the controlling financial interest in the community is held by third parties and, in other cases, the community is owned in a venture structure in which the Company has an ownership interest. Under the management agreements for these communities, the Company receives management fees as well as reimbursed expenses, which represent the reimbursement of expenses it incurs on behalf of the owners. The following table sets forth selected segment financial and operating data: Three Months Ended (in thousands) 2020 2019 Revenue: Independent Living (1) $ 135,862 $ 135,694 Assisted Living and Memory Care (1) 457,479 458,526 CCRCs (1) 94,547 103,727 Health Care Services (1) 94,819 111,532 Management Services (2) 231,432 232,565 Total revenue $ 1,014,139 $ 1,042,044 Segment operating income: (3) Independent Living $ 51,414 $ 52,876 Assisted Living and Memory Care 132,001 140,699 CCRCs 19,931 21,637 Health Care Services (9,121 ) 8,173 Management Services 108,715 15,743 Total segment operating income 302,940 239,128 General and administrative expense (including non-cash stock-based compensation expense) 54,595 56,311 Facility operating lease expense 64,481 68,668 Depreciation and amortization 90,738 96,888 Asset impairment 78,226 391 Loss (gain) on facility lease termination and modification, net — 209 Income (loss) from operations $ 14,900 $ 16,661 As of (in thousands) March 31, 2020 December 31, 2019 Total assets: Independent Living $ 1,533,986 $ 1,441,652 Assisted Living and Memory Care 4,103,793 4,157,610 CCRCs 809,344 742,809 Health Care Services 257,277 256,715 Corporate and Management Services 797,295 595,647 Total assets $ 7,501,695 $ 7,194,433 (1) All revenue is earned from external third parties in the United States. (2) Management services segment revenue includes management fees and reimbursements of costs incurred on behalf of managed communities. (3) Segment operating income is defined as segment revenues less segment facility operating expense (excluding depreciation and amortization) and costs incurred on behalf of managed communities. |
COVID-19 Pandemic
COVID-19 Pandemic | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
COVID-19 Pandemic | COVID-19 Pandemic The United States broadly continues to experience the pandemic caused by COVID-19, which has significantly disrupted, and likely will continue to significantly disrupt for some period, the nation’s economy, the senior living industry, and the Company’s business. The pandemic and the Company’s response efforts began to adversely impact the Company’s occupancy and resident fee revenue during the three months ended March 31, 2020, primarily during the second half of March as new resident leads, visits (including virtual visits), and move-in activity declined significantly compared to typical levels. This trend continued through April 2020. The Company’s home health average daily census also began to decrease in March 2020 as referrals declined significantly due to suspension of elective medical procedures and discharges increasing as a result of stay-at-home orders and recommendations. The Company expects further deterioration of its resident fee revenue resulting from fewer move-ins and resident attrition inherent in its business, which may increase due to the impacts of COVID-19. Lower than normal controllable move-out activity during the pandemic may continue to partially offset future adverse revenue impacts. Facility operating expense for the three months ended March 31, 2020 includes $10.0 million of incremental direct costs to prepare for and respond to the pandemic, including costs for acquisition of additional personal protective equipment ("PPE"), medical equipment, and cleaning and disposable food service supplies, enhanced cleaning and environmental sanitation costs, and increased labor expense. Such costs have escalated following March 31, 2020, and the Company expects such costs to further include increased workers compensation expense, health plan expense, insurance premiums and retention, and consulting and professional services costs, as well as costs for COVID-19 testing of residents and associates where not otherwise covered by government payor or third-party insurance sources. The Company is not able to reasonably predict the total amount of costs it will incur related to the pandemic, and such costs are likely to be substantial. In response to the pandemic, on March 27, 2020, the President signed the Coronavirus Aid, Relief, and Economic Security Act of 2020 (CARES Act) into law. The legislation provides liquidity and financial relief to certain businesses, among other things. As of March 31, 2020, the Company estimated that grants or other funding mechanisms to eligible health care providers for health care related expenses or lost revenues attributable to COVID-19 would partially offset potential reductions in cash flows for the Health Care Services segment. The impacts to the Company of certain provisions of the CARES Act are summarized below. • During April 2020, the Company received $29.5 million of grants from the Public Health and Social Services Emergency Fund (the "Emergency Fund") administered by the Department of Health and Human Services ("HHS"), which was expanded by the CARES Act to provide grants or other funding mechanisms to eligible health care providers for health care related expenses or lost revenues attributable to COVID-19. The amount of the grants the Company received was based primarily on its relative share of aggregate 2019 Medicare fee-for-service reimbursements, and the grants are primarily related to home health, hospice, outpatient therapy, and skilled nursing care provided through its Health Care Services and CCRCs segments. Grants received are subject to the terms and conditions of the program, including that such funds may only be used to prevent, prepare for, and respond to COVID-19 and will reimburse only for health care related expenses or lost revenues that are attributable to COVID-19. The Company continues to evaluate the terms, conditions, and permitted uses associated with the grants, including requirements of HHS, and is in the process of determining what portions of these grants that the Company will be able to retain and use. • During April 2020, the Company received $85.0 million under the Accelerated and Advance Payment Program administered by the Centers for Medicare & Medicaid Services ("CMS"), which was temporarily expanded by the CARES Act. Under the program, the Company has requested acceleration/advancement of 100% of its Medicare payment amount for a 3-month period. Repayments of accelerated/advanced payments are required to begin 120 days after their issuance through offsets of new Medicare claims, and all accelerated/advanced payments are due 210 days following their issuance. • Under the CARES Act, the Company may elect to defer payment of the employer portion of social security payroll taxes incurred from March 27, 2020 to December 31, 2020. One-half of such deferral amount will become due on each of December 31, 2021 and December 31, 2022. The Company intends to utilize this deferral program to delay payment of approximately $76 million of the employer portion of payroll taxes estimated to be incurred between March 27, 2020 and December 31, 2020. • The CARES Act temporarily suspended the 2% Medicare sequestration for the period May 1, 2020 to December 31, 2020, which will primarily benefit the Company’s Health Care Services segment. The Company cannot predict with reasonable certainty the impacts that COVID-19 ultimately will have on its business, results of operations, cash flow, and liquidity, and the Company’s preparation and response efforts may delay or negatively impact its strategic initiatives, including plans for future growth. The ultimate impacts of COVID-19 will depend on many factors, some of which cannot be foreseen, including the duration, severity, and geographic concentrations of the pandemic and any resurgence of the disease; the impact of COVID-19 on the nation’s economy and debt and equity markets and the local economies in the Company’s markets; the development and availability of COVID-19 infection and antibody testing, therapeutic agents, and vaccines and the prioritization of such resources among businesses and demographic groups; government financial and regulatory relief efforts that may become available to business and individuals; perceptions regarding the safety of senior living communities during and after the pandemic; changes in demand for senior living communities and the Company’s ability to adapt its sales and marketing efforts to meet that demand; the impact of COVID-19 on the Company’s residents’ and their families’ ability to afford its resident fees, including due to changes in unemployment rates, consumer confidence, and equity markets caused by COVID-19; changes in the acuity levels of the Company’s new residents; the disproportionate impact of COVID-19 on seniors generally and those residing in the Company’s communities; the duration and costs of the Company’s preparation and response efforts, including increased equipment, supplies, labor, litigation, and other expenses; the impact of COVID-19 on the Company’s ability to complete financings, refinancings, or other transactions (including dispositions) or to generate sufficient cash flow to cover required interest and lease payments and to satisfy financial and other covenants in the Company’s debt and lease documents; increased regulatory requirements and enforcement actions resulting from COVID-19, including those that may limit the Company’s collection efforts for delinquent accounts; and the frequency and magnitude of legal actions and liability claims that may arise due to COVID-19 or the Company’s response efforts. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q. In the opinion of management, these financial statements include all adjustments, which are of a normal and recurring nature, necessary to present fairly the financial position, results of operations, and cash flows of the Company for all periods presented. Certain information and footnote disclosures included in annual financial statements have been condensed or omitted. The Company believes that the disclosures included are adequate and provide a fair presentation of interim period results. Interim financial statements are not necessarily indicative of the financial position or operating results for an entire year. These interim financial statements should be read in conjunction with the audited financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on February 19, 2020. Certain prior period amounts have been reclassified to conform to the current financial statement presentation, with no effect on the Company's condensed consolidated financial position or results of operations. Except for the changes for the impact of the recently adopted accounting pronouncements discussed in this Note, the Company has consistently applied its accounting policies to all periods presented in these condensed consolidated financial statements. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of Brookdale and its consolidated subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. Investments in affiliated companies that the Company does not control, but has the ability to exercise significant influence over governance and operations, are accounted for by the equity method. The ownership interest of consolidated entities not wholly-owned by the Company are presented as noncontrolling interests in the accompanying condensed consolidated financial statements. Noncontrolling interest represents the share of consolidated entities owned by third parties. Noncontrolling interest is adjusted for the noncontrolling holder's share of additional contributions, distributions, and the proportionate share of the net income or loss of each respective entity. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, revenue, asset impairments, self-insurance reserves, performance-based compensation, the allowance for credit losses, depreciation and amortization, leasing transactions, income taxes, and other contingencies. Although these estimates are based on management's best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from the original estimates. |
Lease Accounting | Lease Accounting The Company, as lessee, recognizes a right-of-use asset and a lease liability on the Company's consolidated balance sheet for its community, office, and equipment leases. As of the commencement date of a lease, a lease liability and corresponding right-of-use asset is established on the Company's consolidated balance sheet at the present value of future minimum lease payments. The Company's community leases generally contain fixed annual rent escalators or annual rent escalators based on an index, such as the consumer price index. The future minimum lease payments recognized on the consolidated balance sheet include fixed payments (including in-substance fixed payments) and variable payments estimated utilizing the index or rate on the lease commencement date. The Company recognizes lease expense as incurred for additional variable payments. For the Company's leases that do not contain an implicit rate, the Company utilizes its estimated incremental borrowing rate to determine the present value of lease payments based on information available at commencement of the lease. The Company's estimated incremental borrowing rate reflects the fixed rate at which the Company could borrow a similar amount for the same term on a collateralized basis. The Company elected the short-term lease exception policy which permits leases with an initial term of 12 months or less to not be recorded on the Company's consolidated balance sheet and instead to be recognized as lease expense as incurred. The Company, as lessee, makes a determination with respect to each of its community, office, and equipment leases as to whether each should be accounted for as an operating lease or financing lease. The classification criteria is based on estimates regarding the fair value of the leased asset, minimum lease payments, effective cost of funds, economic life of the asset, and certain other terms in the lease agreements. Lease right-of-use assets are reviewed for impairment whenever changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of right-of-use assets are assessed by a comparison of the carrying amount of the asset to the estimated future undiscounted net cash flows expected to be generated by the asset, calculated utilizing the lowest level of identifiable cash flows. If estimated future undiscounted net cash flows are less than the carrying amount of the asset then the fair value of the asset is estimated. The impairment expense is determined by comparing the estimated fair value of the asset to its carrying amount, with any amount in excess of fair value recognized as an expense in the current period. Undiscounted cash flow projections and estimates of fair value amounts are based on a number of assumptions such as revenue and expense growth rates and estimated lease coverage ratios (Level 3). Operating Leases The Company recognizes operating lease expense for actual rent paid, generally plus or minus a straight-line adjustment for estimated minimum lease escalators if applicable. The right-of-use asset is generally reduced each period by an amount equal to the difference between the operating lease expense and the amount of expense on the lease liability utilizing the effective interest method. Subsequent to the impairment of an operating lease right-of-use asset, the Company recognizes operating lease expense consisting of the reduction of the right-of-use asset on a straight-line basis over the remaining lease term and the amount of expense on the lease liability utilizing the effective interest method. Financing Leases Financing lease right-of-use assets are recognized within property, plant and equipment and leasehold intangibles, net on the Company's consolidated balance sheets. The Company recognizes interest expense on the financing lease liabilities utilizing the effective interest method. The right-of-use asset is generally amortized to depreciation and amortization expense on a straight-line basis over the lease term unless the lease contains an option to purchase the underlying asset that the Company is reasonably certain to exercise. If the Company is reasonably certain to exercise the purchase option, the asset is amortized over the useful life. Sale-Leaseback Transactions For transactions in which an owned community is sold and leased back from the buyer (sale-leaseback transactions), the Company recognizes an asset sale and lease accounting is applied if the Company has transferred control of the community. For such transactions, the Company removes the transferred assets from the consolidated balance sheet and a gain or loss on the sale is recognized for the difference between the carrying amount of the asset and the transaction price for the sale transaction. For sale‑leaseback transactions in which the Company has not transferred control of the underlying asset, the Company does not recognize an asset sale or derecognize the underlying asset until control is transferred. For such transactions, the Company continues to recognize the assets within property, plant and equipment and leasehold intangibles, net and continues to depreciate the asset over its useful life. Additionally, the Company accounts for any amounts received as a financing lease liability and the Company recognizes interest expense on the financing lease liability utilizing the effective interest method with the interest expense limited to an amount that is not greater than the cash payments on the financing lease liability over the term of the lease. |
Gain (Loss) on Sale of Assets | Gain (Loss) on Sale of Assets The Company regularly enters into real estate transactions which may include the disposal of certain communities, including the associated real estate. The Company recognizes gain or loss from real estate sales when the transfer of control is complete. The Company recognizes gain or loss from the sale of equity method investments when the transfer of control is complete and the Company has no continuing involvement with the transferred financial assets. |
Property, Plant and Equipment and Leasehold Intangibles, Net | Property, Plant and Equipment and Leasehold Intangibles, Net Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset group may not be recoverable. Recoverability of an asset group is assessed by comparing its carrying amount to the estimated future undiscounted net cash flows expected to be generated by the asset group through operation or disposition, calculated utilizing the lowest level of identifiable cash flows. If this comparison indicates that the carrying amount of an asset group is not recoverable, the Company is required to recognize an impairment loss. The impairment loss is measured by the amount by which the carrying amount of the asset exceeds its estimated fair value, with any amount in excess of fair value recognized as an expense in the current period. Undiscounted cash flow projections and estimates of fair value amounts are based on a number of assumptions such as revenue and expense growth rates, estimated holding periods, and estimated capitalization rates (Level 3). |
Goodwill | Goodwill The Company tests goodwill for impairment annually during the fourth quarter or more frequently if indicators of impairment arise. Factors the Company considers important in its analysis of whether an indicator of impairment exists include a significant decline in the Company's stock price or market capitalization for a sustained period since the last testing date, significant underperformance relative to historical or projected future operating results, and significant negative industry or economic trends. The Company first assesses qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If so, the Company performs a quantitative goodwill impairment test based upon a comparison of the estimated fair value of the reporting unit to which the goodwill has been assigned with the reporting unit's carrying amount. The fair values used in the quantitative goodwill impairment test are estimated using Level 3 inputs based upon discounted future cash flow projections for the reporting unit. These cash flow projections are based upon a number of estimates and assumptions such as revenue and expense growth rates, capitalization rates, and discount rates. The Company also considers market-based measures such as earnings multiples in its analysis of estimated fair values of its reporting units. If the quantitative goodwill impairment test results in a reporting unit's carrying amount exceeding its estimated fair value, an impairment charge will be recorded based on the difference, with the impairment charge limited to the amount of goodwill allocated to the reporting unit. |
Recently Adopted Accounting Pronouncements/Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 replaces the current incurred loss impairment methodology for credit losses with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The Company adopted this standard effective January 1, 2020 and recognized the cumulative effect of the adoption as an immaterial adjustment to beginning accumulated deficit as of January 1, 2020 for the cumulative effect of adopting ASU 2016-13. In February 2016, the FASB issued ASU 2016-02, Leases ("ASU 2016-02"), which amends the former accounting principles for the recognition, measurement, presentation, and disclosure of leases for both lessees and lessors. The Company adopted these lease accounting standards effective January 1, 2019 and recognized the cumulative effect of the adoption as a $55.9 million adjustment to beginning accumulated deficit as of January 1, 2019. See Footnote 2, Summary of Significant Accounting Policies, in our Annual Report on Form 10-K for the year ended December 31, 2019 for more details regarding the adoption of this accounting pronouncement. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table summarizes the computation of basic and diluted earnings (loss) per share amounts presented in the condensed consolidated statements of operations: Three Months Ended March 31, 2020 2019 Income attributable to common shareholders: Net income (loss) $ 369,515 $ (42,595 ) Weighted average shares outstanding - basic 184,186 186,747 Effect of dilutive securities - Unvested restricted stock and restricted stock units 336 — Weighted average shares outstanding - diluted 184,522 186,747 Basic earnings (loss) per common share: Net income (loss) per share attributable to common shareholders $ 2.01 $ (0.23 ) Diluted earnings (loss) per common share: Net income (loss) per share attributable to common shareholders $ 2.00 $ (0.23 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary of Goodwill and Asset Impairment Expense | The following is a summary of asset impairment expense. Three Months Ended (in millions) 2020 2019 Property, plant and equipment and leasehold intangibles, net $ 11.0 $ — Operating lease right-of-use assets 65.7 — Investment in unconsolidated ventures 1.5 — Other assets, net — 0.4 Asset impairment $ 78.2 $ 0.4 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Current year grants of restricted shares | Grants of restricted stock units and stock awards under the Company's 2014 Omnibus Incentive Plan were as follows: (in thousands, except for per share and unit amounts) Restricted Stock Units and Stock Awards Granted Weighted Average Grant Date Fair Value Total Value Three months ended March 31, 2020 4,438 $ 7.06 $ 31,341 |
Property, Plant and Equipment_2
Property, Plant and Equipment and Leasehold Intangibles, Net (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, plant and equipment and leasehold intangibles, net | As of March 31, 2020 and December 31, 2019 , net property, plant and equipment and leasehold intangibles, which include assets under financing leases, consisted of the following: (in thousands) March 31, 2020 December 31, 2019 Land $ 508,274 $ 450,894 Buildings and improvements 5,236,408 4,790,769 Furniture and equipment 926,094 859,849 Resident and leasehold operating intangibles 317,048 317,111 Construction in progress 71,923 80,729 Assets under financing leases and leasehold improvements 1,523,689 1,847,493 Property, plant and equipment and leasehold intangibles 8,583,436 8,346,845 Accumulated depreciation and amortization (3,284,526 ) (3,237,011 ) Property, plant and equipment and leasehold intangibles, net $ 5,298,910 $ 5,109,834 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of debt | Long-term debt as of March 31, 2020 and December 31, 2019 consists of the following: (in thousands) March 31, 2020 December 31, 2019 Mortgage notes payable due 2020 through 2047; weighted average interest rate of 4.28% for the three months ended March 31, 2020, less debt discount and deferred financing costs of $22.1 million and $17.0 million as of March 31, 2020 and December 31, 2019, respectively (weighted average interest rate of 4.72% in 2019) $ 3,708,677 $ 3,496,735 Other notes payable, weighted average interest rate of 4.10% for the three months ended March 31, 2020 (weighted average interest rate of 5.77% in 2019) and maturity dates ranging from 2020 to 2021 18,879 58,388 Total long-term debt 3,727,556 3,555,123 Current portion 83,014 339,413 Total long-term debt, less current portion $ 3,644,542 $ 3,215,710 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lease Costs | A summary of operating and financing lease expense (including the respective presentation on the condensed consolidated statements of operations) and cash flows from leasing transactions is as follows: Three Months Ended Operating Leases (in thousands) 2020 2019 Facility operating expense $ 4,850 $ 4,625 Facility lease expense 64,481 68,668 Operating lease expense 69,331 73,293 Operating lease expense adjustment (1) 6,733 4,383 Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements (4,088 ) — Operating cash flows from operating leases $ 71,976 $ 77,676 (1) Represents the difference between cash paid and expense recognized. Three Months Ended Financing Leases (in thousands) 2020 2019 Depreciation and amortization $ 9,144 $ 11,678 Interest expense: financing lease obligations 13,282 16,743 Financing lease expense $ 22,426 $ 28,421 Operating cash flows from financing leases $ 13,282 $ 16,743 Financing cash flows from financing leases 5,087 5,453 Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement 1,739 — Total cash flows from financing leases $ 20,108 $ 22,196 |
Finance Lease, Liability, Maturity | The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2020 are as follows (in thousands): Year Ending December 31, Operating Leases Financing Leases 2020 (nine months) $ 226,638 $ 48,958 2021 289,775 65,943 2022 288,988 66,577 2023 290,107 67,334 2024 290,967 68,572 Thereafter 578,896 167,852 Total lease payments 1,965,371 485,236 Purchase option liability and non-cash gain on future sale of property — 411,679 Imputed interest and variable lease payments (508,734 ) (315,354 ) Total lease obligations $ 1,456,637 $ 581,561 |
Lessee, Operating Lease, Liability, Maturity | The aggregate amounts of future minimum lease payments, including community, office, and equipment leases recognized on the condensed consolidated balance sheet as of March 31, 2020 are as follows (in thousands): Year Ending December 31, Operating Leases Financing Leases 2020 (nine months) $ 226,638 $ 48,958 2021 289,775 65,943 2022 288,988 66,577 2023 290,107 67,334 2024 290,967 68,572 Thereafter 578,896 167,852 Total lease payments 1,965,371 485,236 Purchase option liability and non-cash gain on future sale of property — 411,679 Imputed interest and variable lease payments (508,734 ) (315,354 ) Total lease obligations $ 1,456,637 $ 581,561 |
Supplemental Disclosure of Ca_2
Supplemental Disclosure of Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental cash flow information | Three Months Ended (in thousands) 2020 2019 Supplemental Disclosure of Cash Flow Information: Interest paid $ 59,479 $ 62,107 Income taxes paid, net of refunds 957 606 Capital expenditures, net of related payables Capital expenditures - non-development, net $ 60,556 $ 54,602 Capital expenditures - development, net 3,900 5,269 Capital expenditures - non-development - reimbursable 5,827 — Trade accounts payable (898 ) 184 Net cash paid $ 69,385 $ 60,055 Acquisition of communities from Healthpeak Property, plant and equipment and leasehold intangibles, net $ 286,734 $ — Operating lease right-of-use assets (63,285 ) — Financing lease obligations 129,196 — Operating lease obligations 74,335 — Loss (gain) on debt modification and extinguishment, net (19,731 ) — Net cash paid $ 407,249 $ — Acquisition of other assets, net of related payables and cash received: Property, plant and equipment and leasehold intangibles, net $ 179 $ 32,126 Financing lease right-of-use assets 39,260 — Other intangibles assets, net — (4,796 ) Net cash paid $ 39,439 $ 27,330 Proceeds from Sale of CCRC Venture, net Investment in unconsolidated ventures $ (14,848 ) $ — Current portion of long-term debt 34,706 — Accrued expenses (5,025 ) — Other liabilities 60,748 — Loss (gain) on sale of assets, net (370,745 ) — Net cash received $ (295,164 ) $ — Proceeds from sale of other assets, net Prepaid expenses and other assets, net $ (1,261 ) $ (231 ) Assets held for sale (5,274 ) (29,550 ) Property, plant and equipment and leasehold intangibles, net — (457 ) Other liabilities (824 ) 78 Loss (gain) on sale of assets, net (2,094 ) 702 Net cash received $ (9,453 ) $ (29,458 ) Supplemental Schedule of Non-cash Operating, Investing and Financing Purchase of treasury stock: Treasury stock $ — $ 288 Accounts payable — (288 ) Net $ — $ — Assets designated as held for sale: Assets held for sale $ — $ (5,249 ) Property, plant and equipment and leasehold intangibles, net — 5,249 Net $ — $ — Healthpeak master lease modification Property, plant and equipment and leasehold intangibles, net $ (57,462 ) $ — Operating lease right-of-use assets 88,044 — Financing lease obligations 70,874 — Operating lease obligations (101,456 ) — Net $ — $ — Other lease termination and modification, net: Prepaid expenses and other assets, net $ — $ (160 ) Property, plant and equipment and leasehold intangibles, net (9,441 ) 175 Financing lease obligations 9,516 — Other liabilities (75 ) (224 ) Loss (gain) on facility lease termination and modification, net — 209 Net $ — $ — Restricted cash consists principally of escrow deposits for real estate taxes, property insurance, and capital expenditures required by certain lenders under mortgage debt agreements and deposits as security for self-insured retention risk under workers' compensation programs and property insurance programs. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sums to the total of the same such amounts shown in the condensed consolidated statements of cash flows. (in thousands) March 31, 2020 December 31, 2019 Reconciliation of cash, cash equivalents, and restricted cash: Cash and cash equivalents $ 392,674 $ 240,227 Restricted cash 23,908 26,856 Long-term restricted cash 41,917 34,614 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 458,499 $ 301,697 |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The Company disaggregates its revenue from contracts with customers by payor source, as the Company believes it best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors. See details on a reportable segment basis in the tables below. Three Months Ended March 31, 2020 (in thousands) Independent Living Assisted Living and Memory Care CCRCs Health Care Services Total Private pay $ 135,290 $ 440,613 $ 64,703 $ 170 $ 640,776 Government reimbursement 572 16,866 19,405 73,689 110,532 Other third-party payor programs — — 10,439 20,960 31,399 Total resident fee revenue $ 135,862 $ 457,479 $ 94,547 $ 94,819 $ 782,707 Three Months Ended March 31, 2019 (in thousands) Independent Living Assisted Living and Memory Care CCRCs Health Care Services Total Private pay $ 135,045 $ 441,911 $ 71,533 $ 190 $ 648,679 Government reimbursement 649 16,615 21,487 88,657 127,408 Other third-party payor programs — — 10,707 22,685 33,392 Total resident fee revenue $ 135,694 $ 458,526 $ 103,727 $ 111,532 $ 809,479 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | The following table sets forth selected segment financial and operating data: Three Months Ended (in thousands) 2020 2019 Revenue: Independent Living (1) $ 135,862 $ 135,694 Assisted Living and Memory Care (1) 457,479 458,526 CCRCs (1) 94,547 103,727 Health Care Services (1) 94,819 111,532 Management Services (2) 231,432 232,565 Total revenue $ 1,014,139 $ 1,042,044 Segment operating income: (3) Independent Living $ 51,414 $ 52,876 Assisted Living and Memory Care 132,001 140,699 CCRCs 19,931 21,637 Health Care Services (9,121 ) 8,173 Management Services 108,715 15,743 Total segment operating income 302,940 239,128 General and administrative expense (including non-cash stock-based compensation expense) 54,595 56,311 Facility operating lease expense 64,481 68,668 Depreciation and amortization 90,738 96,888 Asset impairment 78,226 391 Loss (gain) on facility lease termination and modification, net — 209 Income (loss) from operations $ 14,900 $ 16,661 As of (in thousands) March 31, 2020 December 31, 2019 Total assets: Independent Living $ 1,533,986 $ 1,441,652 Assisted Living and Memory Care 4,103,793 4,157,610 CCRCs 809,344 742,809 Health Care Services 257,277 256,715 Corporate and Management Services 797,295 595,647 Total assets $ 7,501,695 $ 7,194,433 (1) All revenue is earned from external third parties in the United States. (2) Management services segment revenue includes management fees and reimbursements of costs incurred on behalf of managed communities. (3) Segment operating income is defined as segment revenues less segment facility operating expense (excluding depreciation and amortization) and costs incurred on behalf of managed communities. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect change in accounting principle | $ 1,052,230 | $ 698,725 | $ 917,597 | $ 1,018,413 |
Accumulated Deficit | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect change in accounting principle | $ (3,023,688) | (3,393,088) | $ (3,167,752) | (3,069,272) |
Accumulated Deficit | Cumulative Effect Period Of Adoption Adjustment | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect change in accounting principle | $ (115) | $ (55,885) |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Net income (loss) | $ 369,515 | $ (42,595) |
Weighted average common shares outstanding: | ||
Basic (in shares) | 184,186 | 186,747 |
Effect of dilutive securities - Unvested restricted stock and restricted stock units | $ 336 | $ 0 |
Diluted (in shares) | 184,522 | 186,747 |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Basic (in dollars per share) | $ 2.01 | $ (0.23) |
Diluted (in dollars per share) | $ 2 | $ (0.23) |
Antidilutive securities (shares) | 6,900 | |
Performance-Based Restricted Shares | ||
Earnings Per Share, Basic and Diluted [Abstract] | ||
Antidilutive securities (shares) | 1,800 | |
Unvested Restricted Stock | ||
Earnings Per Share, Basic and Diluted [Abstract] | ||
Antidilutive securities (shares) | 7,200 |
Acquisitions, Dispositions an_2
Acquisitions, Dispositions and Other Transactions - Additional Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020USD ($)community | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($)community | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Operating and financing leases, number of communities | 306 | ||
Number of communities managed by third party | 80 | ||
Assets held for sale | $ | $ 37,397 | $ 42,671 | |
Gain (loss) on sale of assets, net | $ | $ 372,839 | $ (702) | |
Communities Disposed of Through Sale | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities disposed of | 15 | ||
Communities Disposed of Through Lease Terminations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities disposed of | 11 | ||
Sale of 6 communities | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities disposed of | 6 | ||
Net cash proceeds | $ | $ 29,500 | ||
Mortgage notes payable | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Payment for debt extinguishment or debt prepayment cost | $ | $ 5,100 | ||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Communities Disposed of Through Sale | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities disposed of | 1 | 14 | |
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | 1 Community | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Net cash proceeds | $ | $ 5,500 | ||
Gain (loss) on sale of assets, net | $ | $ 200 | ||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Two Communities Held For Sale | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities classified as held for sale | 2 | ||
Assets held for sale | $ | $ 37,400 | ||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Sale of 14 Communities | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Net cash proceeds | $ | $ 85,400 | ||
Gain (loss) on sale of assets, net | $ | $ 5,500 | ||
Current Property Ownership Status | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities owned | 355 | ||
Operating and financing leases, number of communities | 306 | ||
Communities Acquired Previously Leased Or Managed | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities acquired | 26 | ||
Healthpeak | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities acquired | 8 | ||
Purchase price | $ | $ 39,300 | ||
Healthpeak | Communities Acquired Previously Leased Or Managed | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of communities acquired | 18 |
Acquisitions, Dispositions an_3
Acquisitions, Dispositions and Other Transactions - Healthpeak CCRC Venture and Master Lease Transactions (Details) $ in Thousands | Oct. 01, 2019USD ($)communityentry_feeextension_option | Mar. 31, 2020USD ($)communityentry_fee | Mar. 31, 2019USD ($) |
Business Acquisition [Line Items] | |||
Number of additional entry fee | entry_fee | 1 | ||
Gain (loss) on sale of assets, net | $ 372,839 | $ (702) | |
Payments (proceeds) for management agreement termination fee | 100,000 | ||
Gain (loss) on extinguishment of debt | $ 19,181 | $ (67) | |
Number of communities previously subject to sale leaseback transactions | community | 8 | ||
CCRC Ventures, LLC | |||
Business Acquisition [Line Items] | |||
Gain (loss) on sale of assets, net | $ 93,100 | ||
CCRC Ventures, LLC | CCRCs | |||
Business Acquisition [Line Items] | |||
Business acquisition, percentage of voting interests acquired | 51.00% | ||
Number of entry fee | entry_fee | 14 | ||
Purchase price | $ 295,200 | ||
Payments to acquire interest in joint venture | 1,060,000 | ||
Gain (loss) on sale of assets, net | $ 370,700 | ||
Number of entry fee, sales | entry_fee | 2 | ||
HCP, Inc. | CCRCs | |||
Business Acquisition [Line Items] | |||
Payments (proceeds) for management agreement termination fee | $ 100,000 | ||
Master Lease Transactions | |||
Business Acquisition [Line Items] | |||
Number of continuing communities | community | 24 | ||
Operating leases, rent expense | $ 41,700 | ||
Operating leases, rent expense, annual escalator rate | 2.40% | ||
Operating lease, initial lease rate | 7.00% | ||
Gain (loss) on extinguishment of debt | $ 19,700 | ||
Financing lease obligations, carrying value | $ 105,100 | ||
Master Lease Transactions | HCP, Inc. | |||
Business Acquisition [Line Items] | |||
Payments to acquire interest in joint venture | $ 405,500 | ||
Number of communities leased | community | 25 | ||
Number of communities, acquired, previously leased or managed | community | 18 | ||
Number of leases communities transferred to successor operator | community | 1 | ||
Number of continuing communities | community | 24 | ||
Lessee, operating lease, number of extensions | extension_option | 2 | ||
Lessee, operating lease, number of extensions, term | 10 years | ||
Operating lease, capital expenditures, availability | $ 35,000 | ||
Non-Recourse First Mortgages | Master Lease Transactions | |||
Business Acquisition [Line Items] | |||
Proceeds from issuance of debt | $ 192,600 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) | 3 Months Ended | ||
Mar. 31, 2020USD ($)leasecommunity | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Marketable securities | $ 108,039,000 | $ 68,567,000 | |
Line of credit | 166,381,000 | 0 | |
Debt | $ 3,727,556,000 | 3,555,123,000 | |
Number of communities leased | lease | 239 | ||
Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Marketable securities | $ 108,000,000 | ||
Nonrecurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Operating lease, right of use assets impairment charge | 65,700,000 | $ 0 | |
Property, plant and equipment and leasehold intangibles impairment charge | $ 11,000,000 | $ 0 | |
Condensed Consolidated Balance Sheet | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Number of communities leased | community | 35 | ||
Estimated fair value | $ 106,700,000 | ||
Minimum | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount rate | 11.20% | ||
Maximum | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount rate | 12.30% | ||
Line of Credit | Fourth Amended and Restated Credit Agreement | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Line of credit | $ 166,400,000 | ||
Line of Credit | Fifth Amended and Restated Credit Agreement | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Line of credit | 166,400,000 | ||
Long-term debt and lines of credit | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt | 3,900,000,000 | $ 3,600,000,000 | |
Independent Living | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Operating lease, right of use assets impairment charge | (31,300,000) | ||
Assisted Living and Memory Care | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Operating lease, right of use assets impairment charge | (22,200,000) | ||
CCRC Ventures, LLC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Operating lease, right of use assets impairment charge | $ (12,200,000) |
Fair Value Measurements - Goodw
Fair Value Measurements - Goodwill and Asset Impairment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Goodwill and asset impairment | $ 78,226 | $ 391 |
Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Property, plant and equipment and leasehold intangibles, net | 11,000 | 0 |
Operating lease right-of-use assets | 65,700 | 0 |
Investment in unconsolidated ventures | 1,500 | 0 |
Other assets, net | 0 | 400 |
Goodwill and asset impairment | $ 78,200 | $ 400 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - Unvested Restricted Stock $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Restricted Stock Units and Stock Awards Granted (in shares) | shares | 4,438 |
Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 7.06 |
Total value of restricted shares granted | $ | $ 31,341 |
Goodwill - Additional Informati
Goodwill - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Goodwill [Line Items] | ||
Goodwill | $ 154,131,000 | $ 154,131,000 |
Amortization expense related to definite-lived intangible assets | 0 | |
Independent Living | ||
Goodwill [Line Items] | ||
Goodwill | $ 27,300,000 | |
Health Care Services | ||
Goodwill [Line Items] | ||
Goodwill | $ 126,800,000 |
Property, Plant and Equipment_3
Property, Plant and Equipment and Leasehold Intangibles, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | $ 8,583,436 | $ 8,346,845 | |
Accumulated depreciation and amortization | (3,284,526) | (3,237,011) | |
Property, plant and equipment and leasehold intangibles, net | 5,298,910 | 5,109,834 | |
Finance lease, right-of-use asset | 400,000 | 600,000 | |
Depreciation and amortization expense | 90,700 | $ 96,100 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 508,274 | 450,894 | |
Buildings and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 5,236,408 | 4,790,769 | |
Furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 926,094 | 859,849 | |
Resident and leasehold operating intangibles | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 317,048 | 317,111 | |
Construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | 71,923 | 80,729 | |
Assets under financing leases and leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment and leasehold intangibles | $ 1,523,689 | $ 1,847,493 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 3,727,556 | $ 3,555,123 |
Current portion | 83,014 | 339,413 |
Total long-term debt, less current portion | 3,644,542 | 3,215,710 |
Mortgage notes payable | ||
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | 3,708,677 | 3,496,735 |
Unamortized debt discount | $ 22,100 | $ 17,000 |
Weighted average interest rate | 4.28% | 4.72% |
Other notes payable | ||
Long-Term Debt, Capital and Financing Leases and Financing Obligations [Line Items] | ||
Total long-term debt | $ 18,879 | $ 58,388 |
Weighted average interest rate | 4.10% | 5.77% |
Debt - Credit Facilities (Detai
Debt - Credit Facilities (Details) - USD ($) | Dec. 05, 2018 | Mar. 31, 2020 | Dec. 31, 2019 |
Credit Facilities [Line Items] | |||
Line of credit, borrowings outstanding | $ 166,381,000 | $ 0 | |
Fifth Amended and Restated Credit Agreement | Line of Credit | |||
Credit Facilities [Line Items] | |||
Percentage of loan availability from pledged assets that cannot exceed availability from mortgaged assets | 10.00% | ||
Line of credit, borrowings outstanding | 166,400,000 | ||
Letters of credit issued | 47,500,000 | ||
Fifth Amended and Restated Credit Agreement | Line of Credit | Applicable Margin, Less Than Or Equal To 35% Utilization | |||
Credit Facilities [Line Items] | |||
Percentage of utilization | 35.00% | ||
Fifth Amended and Restated Credit Agreement | Line of Credit | Applicable Margin, Greater Than 50% Utilization | |||
Credit Facilities [Line Items] | |||
Percentage of utilization | 50.00% | ||
Fifth Amended and Restated Credit Agreement | Line of Credit | Unused Commitment Fee, Outstanding Debt Percentage Greater Than Or Equal To 50% | |||
Credit Facilities [Line Items] | |||
Quarterly commitment fee | 0.25% | ||
Outstanding debt percentage | 50.00% | ||
Fifth Amended and Restated Credit Agreement | Line of Credit | Unused Commitment Fee, Outstanding Debt Percentage Less Than 50% | |||
Credit Facilities [Line Items] | |||
Quarterly commitment fee | 0.35% | ||
Outstanding debt percentage | 50.00% | ||
Fifth Amended and Restated Credit Agreement | Line of Credit | Minimum | Applicable Margin, Greater Than 35% But Less Than Or Equal To 50% Utilization | |||
Credit Facilities [Line Items] | |||
Percentage of utilization | 35.00% | ||
Fifth Amended and Restated Credit Agreement | Line of Credit | Maximum | Applicable Margin, Greater Than 35% But Less Than Or Equal To 50% Utilization | |||
Credit Facilities [Line Items] | |||
Percentage of utilization | 50.00% | ||
Revolving Credit Facility | Fifth Amended and Restated Credit Agreement | Line of Credit | |||
Credit Facilities [Line Items] | |||
Credit facility, maximum borrowing capacity | $ 250,000,000 | ||
Line of credit facility, remaining borrowing capacity | 35,300,000 | ||
Letter of credit sublimit | Fifth Amended and Restated Credit Agreement | Line of Credit | |||
Credit Facilities [Line Items] | |||
Credit facility, maximum borrowing capacity | 60,000,000 | ||
Letters of credit issued | 48,100,000 | ||
Swingline Line of Credit | Fifth Amended and Restated Credit Agreement | Line of Credit | |||
Credit Facilities [Line Items] | |||
Credit facility, maximum borrowing capacity | 50,000,000 | ||
Option to increase maximum borrowing capacity | Fifth Amended and Restated Credit Agreement | Line of Credit | |||
Credit Facilities [Line Items] | |||
Credit facility, maximum borrowing capacity | $ 100,000,000 | ||
Letter of Credit | Fifth Amended and Restated Credit Agreement | Line of Credit | |||
Credit Facilities [Line Items] | |||
Credit facility, maximum borrowing capacity | $ 50,000,000 | ||
LIBOR | Fifth Amended and Restated Credit Agreement | Line of Credit | Applicable Margin, Less Than Or Equal To 35% Utilization | |||
Credit Facilities [Line Items] | |||
Basis spread on variable rate basis | 2.25% | ||
LIBOR | Fifth Amended and Restated Credit Agreement | Line of Credit | Applicable Margin, Greater Than 35% But Less Than Or Equal To 50% Utilization | |||
Credit Facilities [Line Items] | |||
Basis spread on variable rate basis | 2.75% | ||
LIBOR | Fifth Amended and Restated Credit Agreement | Line of Credit | Applicable Margin, Greater Than 50% Utilization | |||
Credit Facilities [Line Items] | |||
Basis spread on variable rate basis | 3.25% |
Debt - Financings (Details)
Debt - Financings (Details) | Mar. 31, 2020USD ($)community | Mar. 20, 2020USD ($) | Mar. 19, 2020USD ($)community | Jan. 31, 2020USD ($)community | Mar. 31, 2020USD ($)community |
Mortgage notes payable | |||||
Debt Instrument [Line Items] | |||||
Percentage of principal bearing fixed rate | 70.00% | ||||
Interest rate, stated percentage | 3.55% | 3.62% | 3.55% | ||
Amount bearing fixed interest | $ 73,100,000 | $ 73,100,000 | |||
Amount bearing variable interest | 76,200,000 | 76,200,000 | |||
Mortgage notes payable | Non-Recourse Supplemental Loan | |||||
Debt Instrument [Line Items] | |||||
Face amount | 149,300,000 | $ 30,000,000 | $ 29,200,000 | $ 238,200,000 | 149,300,000 |
Mortgage notes payable | Mortgage Debt Due 2020 | |||||
Debt Instrument [Line Items] | |||||
Face amount | 69,700,000 | 69,700,000 | |||
Extinguishment of debt | $ 33,100,000 | 136,300,000 | |||
Mortgage notes payable | Mortgage Debt Due 2021 | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 333,100,000 | $ 333,100,000 | |||
Secured debt | Non-Recourse First Mortgages | |||||
Debt Instrument [Line Items] | |||||
Number of communities securing debt | community | 18 | 7 | 14 | 18 | |
LIBOR | Mortgage notes payable | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate basis | 2.10% | 2.50% | 2.25% | 2.90% | |
Healthpeak | Mortgage notes payable | Non-Recourse Supplemental Loan | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 192,600,000 | ||||
Healthpeak | Secured debt | Non-Recourse First Mortgages | |||||
Debt Instrument [Line Items] | |||||
Number of communities securing debt | community | 13 |
Leases (Details)
Leases (Details) | 3 Months Ended |
Mar. 31, 2020leasecommunity | |
Leases [Abstract] | |
Operating and financing leases, number of communities | community | 306 |
Operating leases, number of communities | 239 |
Financing leases, number of communities | 67 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Finance and operating lease, renewal term | 5 years |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Finance and operating lease, renewal term | 20 years |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Leases [Abstract] | |||
Facility operating expense | $ 4,850 | $ 4,625 | |
Facility lease expense | 64,481 | 68,668 | |
Operating lease expense | 69,331 | 73,293 | |
Operating lease expense adjustment | 6,733 | 4,383 | |
Changes in operating lease assets and liabilities for lessor capital expenditure reimbursements | (4,088) | 0 | |
Operating cash flows from operating leases | 71,976 | 77,676 | |
Depreciation and amortization | 9,144 | 11,678 | |
Interest expense: financing lease obligations | 13,282 | 16,743 | |
Financing lease expense | 22,426 | 28,421 | |
Operating cash flows from financing leases | 13,282 | 16,743 | |
Financing cash flows from financing leases | 5,087 | 5,453 | |
Changes in financing lease assets and liabilities for lessor capital expenditure reimbursement | 1,739 | $ 0 | |
Total cash flows from financing leases | $ 20,108 | $ 22,196 |
Leases - Maturity ASC 842 (Deta
Leases - Maturity ASC 842 (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Operating Leases | |
2020 (nine months) | $ 226,638 |
2021 | 289,775 |
2022 | 288,988 |
2023 | 290,107 |
2024 | 290,967 |
Thereafter | 578,896 |
Total lease payments | 1,965,371 |
Purchase option liability and non-cash gain on future sale of property | 0 |
Imputed interest and variable lease payments | (508,734) |
Total lease obligations | 1,456,637 |
Financing Leases | |
2020 (nine months) | 48,958 |
2021 | 65,943 |
2022 | 66,577 |
2023 | 67,334 |
2024 | 68,572 |
Thereafter | 167,852 |
Total lease payments | 485,236 |
Purchase option liability and non-cash gain on future sale of property | 411,679 |
Imputed interest and variable lease payments | (315,354) |
Total lease obligations | $ 581,561 |
Supplemental Disclosure of Ca_3
Supplemental Disclosure of Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | ||
Interest paid | $ 59,479 | $ 62,107 |
Income taxes paid, net of refunds | 957 | 606 |
Net cash paid | 69,385 | 60,055 |
Gain (loss) on debt modification and extinguishment, net | 19,181 | (67) |
Investment in unconsolidated ventures | (268) | (3,986) |
Loss (gain) on sale of assets, net | (372,839) | 702 |
Prepaid expenses and other assets, net | (1,696) | 12,358 |
Loss (gain) on facility lease termination and modification, net | 0 | 209 |
Additions to property, plant and equipment and leasehold improvements | ||
Supplemental Cash Flow Information [Abstract] | ||
Net cash paid | 69,385 | 60,055 |
Trade accounts payable | (898) | 184 |
Acquisition of communities from Healthpeak | ||
Supplemental Cash Flow Information [Abstract] | ||
Property, plant and equipment and leasehold intangibles, net | 286,734 | 0 |
Operating lease right-of-use assets | 63,285 | 0 |
Financing lease obligations | 129,196 | 0 |
Operating lease obligations | 74,335 | 0 |
Gain (loss) on debt modification and extinguishment, net | 19,731 | 0 |
Net cash paid | 407,249 | 0 |
Acquisition of assets, net of related payables and cash received | ||
Supplemental Cash Flow Information [Abstract] | ||
Property, plant and equipment and leasehold intangibles, net | 179 | 32,126 |
Net cash paid | 39,439 | 27,330 |
Financing lease right-of-use assets | 39,260 | 0 |
Other intangibles assets, net | 0 | (4,796) |
Proceeds from Sale of CCRC Venture, net | ||
Supplemental Cash Flow Information [Abstract] | ||
Investment in unconsolidated ventures | (14,848) | 0 |
Current portion of long-term debt | 34,706 | 0 |
Accrued expenses | (5,025) | 0 |
Other liabilities | (60,748) | 0 |
Loss (gain) on sale of assets, net | (370,745) | 0 |
Net cash received | (295,164) | 0 |
Proceeds from sale of assets, net | ||
Supplemental Cash Flow Information [Abstract] | ||
Other liabilities | (824) | 78 |
Loss (gain) on sale of assets, net | (2,094) | 702 |
Prepaid expenses and other assets, net | (1,261) | (231) |
Assets held for sale | (5,274) | (29,550) |
Property, plant and equipment and leasehold intangibles, net | 0 | (457) |
Net cash received | (9,453) | (29,458) |
Purchase of Treasury Stock | ||
Supplemental Cash Flow Information [Abstract] | ||
Treasury stock | 0 | 288 |
Accounts payable | 0 | (288) |
Net | 0 | 0 |
Assets designated as held for sale | ||
Supplemental Cash Flow Information [Abstract] | ||
Assets held for sale | 0 | 5,249 |
Net | 0 | 0 |
Property, plant and equipment and leasehold intangibles, net | 0 | 5,249 |
Healthpeak master lease modification | ||
Supplemental Cash Flow Information [Abstract] | ||
Operating lease right-of-use assets | 88,044 | 0 |
Financing lease obligations | 70,874 | 0 |
Operating lease obligations | (101,456) | 0 |
Net | 0 | 0 |
Property, plant and equipment and leasehold intangibles, net | (57,462) | 0 |
Noncash lease termination and modification, net | ||
Supplemental Cash Flow Information [Abstract] | ||
Financing lease obligations | 9,516 | 0 |
Other liabilities | (75) | (224) |
Prepaid expenses and other assets, net | 0 | 160 |
Property, plant and equipment and leasehold intangibles, net | 9,441 | (175) |
Net | 0 | 0 |
Loss (gain) on facility lease termination and modification, net | 0 | 209 |
Non-development | Additions to property, plant and equipment and leasehold improvements | ||
Supplemental Cash Flow Information [Abstract] | ||
Net cash paid | 60,556 | 54,602 |
Development | Additions to property, plant and equipment and leasehold improvements | ||
Supplemental Cash Flow Information [Abstract] | ||
Net cash paid | 3,900 | 5,269 |
Non-development - reimbursable | Additions to property, plant and equipment and leasehold improvements | ||
Supplemental Cash Flow Information [Abstract] | ||
Net cash paid | $ 5,827 | $ 0 |
Supplemental Disclosure of Ca_4
Supplemental Disclosure of Cash Flow Information - Cash and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 392,674 | $ 240,227 | ||
Restricted cash | 23,908 | 26,856 | ||
Long-term restricted cash | 41,917 | 34,614 | ||
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 458,499 | $ 301,697 | $ 328,500 | $ 450,218 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Sep. 30, 2018 | Dec. 31, 2019 | |
Valuation Allowance [Line Items] | ||||
Gross deferred federal, state and local tax expense (benefit) | $ 90,900 | |||
Gain (loss) on sale of assets, net | 372,839 | $ (702) | ||
Deferred federal, state and local tax expense (benefit) | (2,200) | |||
Change in valuation allowance | 112,600 | |||
Deferred tax asset related to employee compensation | 1,700 | 1,700 | ||
Valuation allowance | 296,300 | $ 408,900 | ||
Federal and State | ||||
Valuation Allowance [Line Items] | ||||
Deferred federal, state and local tax expense (benefit) | $ (6,500) | |||
Change in valuation allowance | $ 6,600 | |||
Operating loss carryforwards | 8,200 | |||
ASC 842 | ||||
Valuation Allowance [Line Items] | ||||
Change in valuation allowance | 13,800 | |||
Current operating loss | ||||
Valuation Allowance [Line Items] | ||||
Change in valuation allowance | 8,300 | |||
CCRC Ventures, LLC | ||||
Valuation Allowance [Line Items] | ||||
Gain (loss) on sale of assets, net | 93,100 | |||
Healthpeak | ||||
Valuation Allowance [Line Items] | ||||
Change in valuation allowance | $ 117,600 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,014,139 | $ 1,042,044 |
Private pay | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 640,776 | 648,679 |
Government reimbursement | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 110,532 | 127,408 |
Other third-party payor programs | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 31,399 | 33,392 |
Total resident fee revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 782,707 | 809,479 |
Independent Living | Private pay | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 135,290 | 135,045 |
Independent Living | Government reimbursement | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 572 | 649 |
Independent Living | Other third-party payor programs | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 0 |
Independent Living | Total resident fee revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 135,862 | 135,694 |
Assisted Living and Memory Care | Private pay | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 440,613 | 441,911 |
Assisted Living and Memory Care | Government reimbursement | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 16,866 | 16,615 |
Assisted Living and Memory Care | Other third-party payor programs | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 0 |
Assisted Living and Memory Care | Total resident fee revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 457,479 | 458,526 |
CCRCs | Private pay | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 64,703 | 71,533 |
CCRCs | Government reimbursement | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 19,405 | 21,487 |
CCRCs | Other third-party payor programs | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 10,439 | 10,707 |
CCRCs | Total resident fee revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 94,547 | 103,727 |
Health Care Services | Private pay | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 170 | 190 |
Health Care Services | Government reimbursement | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 73,689 | 88,657 |
Health Care Services | Other third-party payor programs | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 20,960 | 22,685 |
Health Care Services | Total resident fee revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 94,819 | $ 111,532 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Monthly resident fees | $ 39.8 | $ 38.9 | |
Revenue recognized | 48.3 | $ 61.7 | |
Facility expense, allowance for credit loss | 4 | $ 3.5 | |
Deferred Revenue and Credits | |||
Disaggregation of Revenue [Line Items] | |||
Contract with customer, liability | $ 72.1 | $ 72.5 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020USD ($)segment | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | segment | 5 | ||
Revenue | $ 1,014,139 | $ 1,042,044 | |
Segment Operating Income | 302,940 | 239,128 | |
General and administrative expense (including non-cash stock-based compensation expense) | 54,595 | 56,311 | |
Facility lease expense | 64,481 | 68,668 | |
Depreciation and amortization | 90,738 | 96,888 | |
Asset impairment | 78,226 | 391 | |
Loss (gain) on facility lease termination and modification, net | 0 | 209 | |
Income (loss) from operations | 14,900 | 16,661 | |
Total assets | 7,501,695 | $ 7,194,433 | |
Operating Segments | Independent Living | |||
Segment Reporting Information [Line Items] | |||
Revenue | 135,862 | 135,694 | |
Segment Operating Income | 51,414 | 52,876 | |
Total assets | 1,533,986 | 1,441,652 | |
Operating Segments | Assisted Living and Memory Care | |||
Segment Reporting Information [Line Items] | |||
Revenue | 457,479 | 458,526 | |
Segment Operating Income | 132,001 | 140,699 | |
Total assets | 4,103,793 | 4,157,610 | |
Operating Segments | CCRCs | |||
Segment Reporting Information [Line Items] | |||
Revenue | 94,547 | 103,727 | |
Segment Operating Income | 19,931 | 21,637 | |
Total assets | 809,344 | 742,809 | |
Operating Segments | Health Care Services | |||
Segment Reporting Information [Line Items] | |||
Revenue | 94,819 | 111,532 | |
Segment Operating Income | (9,121) | 8,173 | |
Total assets | 257,277 | 256,715 | |
Operating Segments | Management Services | |||
Segment Reporting Information [Line Items] | |||
Revenue | 231,432 | 232,565 | |
Segment Operating Income | 108,715 | $ 15,743 | |
Total assets | $ 797,295 | $ 595,647 |
COVID-19 Pandemic (Details)
COVID-19 Pandemic (Details) - CARES Act - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Subsequent Event [Line Items] | ||
Facility operating expense | $ 10 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Grants from the Emergency Fund | $ 29.5 | |
Amount received from Accelerated and Advance Payment Program | 85 | |
Employer portion of payroll taxes delayed | $ 76 |