CNL Healthcare Properties (CHTH) 10-Q 9 Nov 23 2023 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2023	Nov. 08, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	000-54685
Entity Registrant Name	CNL Healthcare Properties, Inc.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	27-2876363
Entity Address, Address Line One	CNL Center at City Commons
Entity Address, Address Line Two	450 South Orange Avenue
Entity Address, City or Town	Orlando
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	32801
City Area Code	407
Local Phone Number	650-1000
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		175,292,459
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Entity Central Index Key	0001496454
Current Fiscal Year End Date	--12-31

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
ASSETS
Real estate investment properties, net (including VIEs $30,267 and $30,906, respectively)	$ 1,286,207	$ 1,313,438
Cash (including VIEs $507 and $646, respectively)	53,501	69,504
Restricted cash (including VIEs $1 and $9, respectively)	2,196	4,070
Other assets (including VIEs $143 and $554, respectively)	30,004	36,868
Deferred rent, lease incentives and intangibles, net	11,694	13,423
Total assets	1,383,602	1,437,303
Liabilities:
Mortgages and other notes payable, net (including VIEs $20,752 and $21,142, respectively)	36,824	61,773
Credit facilities	547,127	546,100
Accounts payable and accrued liabilities (including VIEs $1,014 and $533, respectively)	30,409	30,270
Total liabilities	623,295	647,009
Commitments and contingencies (Note 7)
Stockholders' equity:
Preferred stock, $0.01 par value per share, 200,000 shares authorized; none issued or outstanding	0	0
Excess shares, $0.01 par value per share, 300,000 shares authorized; none issued or outstanding	0	0
Common stock, $0.01 par value per share, 1,120,000 shares authorized, 186,626 shares issued and 173,960 shares outstanding	1,740	1,740
Capital in excess of par value	1,516,926	1,516,926
Accumulated income	83,828	100,408
Accumulated distributions	(842,667)	(829,307)
Accumulated other comprehensive loss	(9)	(16)
Total stockholders' equity	759,818	789,751
Noncontrolling interest	489	543
Total equity	760,307	790,294
Total liabilities and equity	1,383,602	1,437,303
Non-Related Party
Liabilities:
Other liabilities and due to related parties	7,573	7,469
Related Party
Liabilities:
Other liabilities and due to related parties	$ 1,362	$ 1,397

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Real estate investment properties	$ 1,286,207	$ 1,313,438
Cash	53,501	69,504
Restricted cash	2,196	4,070
Other assets	30,004	36,868
Mortgages and other notes payable, net	36,824	61,773
Accounts payable and accrued liabilities	$ 30,409	$ 30,270
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	200,000,000	200,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Excess shares, par value (in dollars per share)	$ 0.01	$ 0.01
Excess shares, shares authorized (in shares)	300,000,000	300,000,000
Excess shares, shares issued (in shares)	0	0
Excess shares, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	1,120,000,000	1,120,000,000
Common stock, shares issued (in shares)	186,626,000	186,626,000
Common stock, shares outstanding (in shares)	173,960,000	173,960,000
Variable Interest Entity, Primary Beneficiary
Real estate investment properties	$ 30,267	$ 30,906
Cash	507	646
Restricted cash	1	9
Other assets	143	554
Mortgages and other notes payable, net	20,752	21,142
Accounts payable and accrued liabilities	1,014	533
Other liabilities	$ 196	$ 91

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Revenues:
Rental income and related revenues	$ 6,730	$ 6,668	$ 20,166	$ 20,240
Resident fees and services	79,483	74,824	234,892	220,888
Total revenues	86,213	81,492	255,058	241,128
Operating expenses:
Property operating expenses	59,395	57,297	175,687	169,148
General and administrative expenses	2,015	2,730	6,569	7,802
Financing coordination fees	0	0	163	0
Depreciation and amortization	12,471	13,232	38,741	40,765
Total operating expenses	81,238	80,435	243,130	239,337
Gain on sale of real estate	0	6,282	0	6,282
Operating income	4,975	7,339	11,928	8,073
Other income (expense):
Interest and other income	506	70	2,510	4,064
Interest expense and loan cost amortization	(10,762)	(6,076)	(30,680)	(14,678)
Gain on change of control of a joint venture	0	0	0	8,376
Total other expense	(10,256)	(6,006)	(28,170)	(2,238)
(Loss) income before income taxes	(5,281)	1,333	(16,242)	5,835
Income tax expense	(118)	(71)	(321)	(221)
Net (loss) income	(5,399)	1,262	(16,563)	5,614
Less: Amounts attributable to noncontrolling interests	15	940	17	988
Net (loss) income attributable to common stockholders	$ (5,414)	$ 322	$ (16,580)	$ 4,626
Net income (loss) per share of common stock (basic and diluted)
Net (loss) income per share of common stock, basic (in dollars per share)	$ (0.03)	$ 0	$ (0.10)	$ 0.03
Net (loss) income per share of common stock, diluted (in dollars per share)	$ (0.03)	$ 0	$ (0.10)	$ 0.03
Weighted average number of shares outstanding, basic (in shares)	173,960	173,960	173,960	173,960
Weighted average number of shares outstanding, diluted (in shares)	173,960	173,960	173,960	173,960
Asset management fees
Operating expenses:
Management fees	$ 3,476	$ 3,496	$ 10,427	$ 10,598
Property management fees
Operating expenses:
Management fees	$ 3,881	$ 3,680	$ 11,543	$ 11,024

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ (5,399)	$ 1,262	$ (16,563)	$ 5,614
Other comprehensive income (loss):
Unrealized gain (loss) on derivative financial instruments, net	56	(145)	7	1,702
Total other comprehensive income (loss)	56	(145)	7	1,702
Comprehensive (loss) income	(5,343)	1,117	(16,556)	7,316
Less: Comprehensive income attributable to noncontrolling interest	15	940	17	988
Comprehensive (loss) income attributable to common stockholders	$ (5,358)	$ 177	$ (16,573)	$ 6,328

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Total Stockholders' Equity	Common Stock	Capital in Excess of Par Value	Accumulated Income	Accumulated Distributions	Accumulated Other Comprehensive (Loss) Income	Non- controlling Interest
Beginning Balance (in shares) at Dec. 31, 2021			173,960
Beginning Balance at Dec. 31, 2021	$ 810,761	$ 809,044	$ 1,740	$ 1,516,926	$ 101,861	$ (811,493)	$ 10	$ 1,717
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	5,614	4,626			4,626			988
Other comprehensive (loss) income	1,702	1,702					1,702
Distributions to noncontrolling interests	(2,134)							(2,134)
Cash distributions declared	(13,360)	(13,360)				(13,360)
Ending Balance (in shares) at Sep. 30, 2022			173,960
Ending Balance at Sep. 30, 2022	802,583	802,012	$ 1,740	1,516,926	106,487	(824,853)	1,712	571
Beginning Balance (in shares) at Jun. 30, 2022			173,960
Beginning Balance at Jun. 30, 2022	808,054	806,289	$ 1,740	1,516,926	106,165	(820,399)	1,857	1,765
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	1,262	322			322			940
Other comprehensive (loss) income	(145)	(145)					(145)
Distributions to noncontrolling interests	(2,134)							(2,134)
Cash distributions declared	(4,454)	(4,454)				(4,454)
Ending Balance (in shares) at Sep. 30, 2022			173,960
Ending Balance at Sep. 30, 2022	$ 802,583	802,012	$ 1,740	1,516,926	106,487	(824,853)	1,712	571
Beginning Balance (in shares) at Dec. 31, 2022	173,960		173,960
Beginning Balance at Dec. 31, 2022	$ 790,294	789,751	$ 1,740	1,516,926	100,408	(829,307)	(16)	543
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(16,563)	(16,580)			(16,580)			17
Other comprehensive (loss) income	7	7					7
Distributions to noncontrolling interests	(71)							(71)
Cash distributions declared	$ (13,360)	(13,360)				(13,360)
Ending Balance (in shares) at Sep. 30, 2023	173,960		173,960
Ending Balance at Sep. 30, 2023	$ 760,307	759,818	$ 1,740	1,516,926	83,828	(842,667)	(9)	489
Beginning Balance (in shares) at Jun. 30, 2023			173,960
Beginning Balance at Jun. 30, 2023	770,117	769,630	$ 1,740	1,516,926	89,242	(838,213)	(65)	487
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(5,399)	(5,414)			(5,414)			15
Other comprehensive (loss) income	56	56					56
Distributions to noncontrolling interests	(13)							(13)
Cash distributions declared	$ (4,454)	(4,454)				(4,454)
Ending Balance (in shares) at Sep. 30, 2023	173,960		173,960
Ending Balance at Sep. 30, 2023	$ 760,307	$ 759,818	$ 1,740	$ 1,516,926	$ 83,828	$ (842,667)	$ (9)	$ 489

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Stockholders' Equity [Abstract]
Cash distributions declared (in dollars per share)	$ 0.0256	$ 0.0256	$ 0.0768	$ 0.0768

CONDENSED CONSOLIDATED STATEM_5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Operating activities:
Net cash flows provided by operating activities	$ 24,616	$ 34,394
Investing activities:
Acquisition of joint venture interest, net of cash acquired	0	(1,134)
Net proceeds from sale of property	0	36,655
Capital expenditures	(10,463)	(12,288)
Purchase of held-to-maturity securities	(4,880)	0
Proceeds from maturity of short-term securities	15,000	0
Other investing activities	0	373
Net cash (used in) provided by investing activities	(343)	23,606
Financing activities:
Distributions to stockholders	(13,360)	(13,360)
Draws on line of credit	0	45,000
Purchase of interest rate cap	(3,211)	0
Principal payments on mortgages and other notes payable	(25,067)	(45,935)
Distributions to noncontrolling interests	(71)	(2,134)
Other financing activities	(441)	(324)
Net cash flows used in financing activities	(42,150)	(16,753)
Net (decrease) increase in cash and restricted cash	(17,877)	41,247
Cash and restricted cash at beginning of period	73,574	57,681
Cash and restricted cash at end of period	55,697	98,928
Supplemental disclosure of non-cash investing and financing activities:
Real estate investment properties	0	29,384
Intangibles	0	4,281
Mortgages and notes payable	0	(18,468)
Net assets recognized upon the change in control of the Windsor Manor Joint Venture	$ 0	$ 15,197

Organization

Organization	9 Months Ended
	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Organization CNL Healthcare Properties, Inc. (the “Company”) is a Maryland corporation that elected to be taxed as a real estate investment trust (“REIT”) for United States (“U.S.”) federal income tax purposes. The Company has been and intends to continue to be organized and operate in a manner that allows it to remain qualified as a REIT for U.S. federal income tax purposes. The Company conducts substantially all of its operations either directly or indirectly through: (1) an operating partnership, CHP Partners, LP (“Operating Partnership”), in which the Company is the sole limited partner and its wholly-owned subsidiary, CHP GP, LLC, is the sole general partner; (2) a wholly-owned taxable REIT subsidiary (“TRS”), CHP TRS Holding, Inc.; (3) property owner and lender subsidiaries, which are single purpose entities; and (4) investments in joint ventures. The Company is externally managed and advised by CNL Healthcare Corp. (“Advisor”), which is an affiliate of CNL Financial Group, LLC (“Sponsor”). The Sponsor is an affiliate of CNL Financial Group, Inc. (“CNL”). The Advisor is responsible for managing the Company’s day-to-day operations, serving as a consultant in connection with policy decisions to be made by the board of directors, and for identifying, recommending and executing on possible strategic alternatives and dispositions on the Company’s behalf pursuant to an advisory agreement among the Company, the Operating Partnership and the Advisor (as amended, the “Advisory Agreement”). Substantially all of the Company’s operating, administrative and certain property management services are provided by affiliates of the Advisor. In addition, certain property management services are provided by third-party property managers. In 2017, the Company began evaluating possible strategic alternatives to provide liquidity to the Company’s stockholders. As part of executing under possible strategic alternatives, the Company’s board of directors committed to a plan to sell 70 properties, which included medical office buildings, post-acute care facilities and acute care hospitals across the U.S., collectively (the “MOB/Healthcare Portfolio”), plus several skilled nursing facilities. The Company completed the sale of the last of the 70 properties in 2022.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation and Consolidation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the U.S. (“GAAP”). The unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which, in the opinion of management, are necessary for the fair statement of the Company’s results for the interim period presented. Operating results for the nine months ended September 30, 2023 may not be indicative of the results that may be expected for the year ending December 31, 2023. Amounts as of December 31, 2022 included in the unaudited condensed consolidated financial statements have been derived from audited consolidated financial statements as of that date but do not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The accompanying unaudited condensed consolidated financial statements include the Company’s accounts, the accounts of wholly owned subsidiaries or subsidiaries for which the Company has a controlling interest, the account s of v ariable interest entities (“VIEs”) in which the Company is the primary beneficiary, and the accounts of other subsidiaries over which the Company has a controlling financial interest. All material intercompany accounts and transactions have been eliminated in consolidation. 2. Summary of Significant Accounting Policies (continued) Grant Income — In response to the coronavirus pandemic, the federal government and some states provided funds to providers of seniors housing communities. These funds were deemed federal/state governmental grants and provided that the recipients attest to and comply with certain terms and conditions. Grant income is recognized upon receipt of the funds and when all the conditions of the grant have been met. During the nine months ended September 30, 2023 and 2022, the Company recorded approximately $1.0 million and $3.9 million, respectively, as other income in the accompanying condensed consolidated statements of operations as all conditions of the grant had been met. Use of Estimates — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated financial statements, the reported amounts of revenues and expenses during the reporting periods and the disclosure of contingent liabilities. For example, significant assumptions are made in the analysis of real estate impairments, the valuation of contingent assets and liabilities, and the valuation of restricted common stock (“Restricted Stock”) shares issued to the Advisor. Accordingly, actual results could differ from those estimates. Variable Interest Entities — As of December 31, 2022, the Company had net assets in two subsidiaries classified as VIEs. The Company determined it was the primary beneficiary and held a controlling financial interest in the subsidiaries due to its power to direct the activities that most significantly impact the economic performance of these entities, as well as its obligation to absorb the losses and its right to receive benefits from these entities that could potentially be significant to these entities. As such, the transactions and accounts of these VIEs were included in the accompanying condensed consolidated financial statements. The Company sold the property owned by one of these subsidiaries in August 2022, dissolved the subsidiary during the nine months ended September 30, 2023 and as of September 30, 2023, had one remaining subsidiary classified as a VIE. The Company’s maximum exposure to loss as a result of its involvement with this VIE is limited to its net investment in this entity which totaled approximately $8.5 million

Revenue

Revenue	9 Months Ended
	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue	Revenue The following table presents disaggregated revenue related to the Company’s resident fees and services during the quarter and nine months ended September 30, 2023 and 2022: Quarter Ended September 30, Number of Units Revenues (in millions) Percentage of Revenues Resident fees and services: 2023 2022 2023 2022 2023 2022 Independent living 2,222 2,223 $ 20.4 $ 18.7 25.7 % 25.0 % Assisted living 3,039 3,041 39.5 37.3 49.7 49.9 Memory care 932 932 15.5 15.1 19.5 20.2 Other revenues — — 4.1 3.7 5.1 4.9 6,193 6,196 $ 79.5 $ 74.8 100.0 % 100.0 % Nine Months Ended September 30, Number of Units Revenues (in millions) Percentage of Revenues Resident fees and services: 2023 2022 2023 2022 2023 2022 Independent living 2,222 2,223 $ 60.0 $ 55.1 25.5 % 24.9 % Assisted living 3,039 3,041 117.1 109.5 49.9 49.7 Memory care 932 932 46.1 45.6 19.6 20.6 Other revenues — — 11.7 10.7 5.0 4.8 6,193 6,196 $ 234.9 $ 220.9 100.0 % 100.0 %

Real Estate Assets, net

Real Estate Assets, net	9 Months Ended
	Sep. 30, 2023
Real Estate [Abstract]
Real Estate Assets, net	Real Estate Assets, net The gross carrying amount and accumulated depreciation of the Company’s real estate assets as of September 30, 2023 and December 31, 2022 are as follows (in thousands): September 30, December 31, Land and land improvements $ 136,984 $ 136,416 Building and building improvements 1,499,634 1,495,552 Furniture, fixtures and equipment 110,984 105,784 Less: accumulated depreciation (461,395) (424,314) Real estate investment properties, net $ 1,286,207 $ 1,313,438

Indebtedness

Indebtedness	9 Months Ended
	Sep. 30, 2023
Debt Disclosure [Abstract]
Indebtedness	Indebtedness During the nine months ended September 30, 2023, the Company paid approximately $25.1 million in principal payments, which included the repayment of a mortgage loan of approximately $22.8 million collateralized by one property in advance of its scheduled maturity in June 2023, the repayment o f $1.4 million of unscheduled principal payments relating to a mortgage loan collateralized by five properties and $0.9 million of scheduled principal payments. During the nine months ended September 30, 2023, the Company also exercised its one-year extension option for the $133.0 million outstanding under the Company’s Revolving Credit Facility, which extended the maturity date from May 2023 to May 2024. The Company has $0.2 million of scheduled principal payments coming due during the remainder of 2023. In June 2023, the Company refinanced a mortgage loan with the existing lender that consisted of $16.1 million of indebtedness secured by five properties that had a LIBOR based benchmark rate and was scheduled to mature in February 2024. In connection with the refinancing, the Company also amended certain terms and transitioned its benchmark rate from LIBOR to Term SOFR effective June 30, 2023, extended the maturity date from February 2024 to February 2026 and obtained two one-year extension options. During the nine months ended September 30, 2023, the Company purchased a short-term interest rate cap for approximately $3.1 million, which had a notional value of $420.0 million and a strike price of 3.5%, to hedge the majority of its Credit Facilities. The interest rate cap matured in August 2023. In addition, the Company purchased a short-term interest rate cap for approximately $0.1 million, with a notional value of $8.0 million, a strike price of 3.5%, and a maturity date of January 2024 to hedge a portion of its interest rate exposure relating to the $16.3 million variable rate secured indebtedness that was refinanced in June 2023. The fair value of these cash flow hedges of approximately $0.04 million is included in other assets in the accompanying condensed consolidated balance sheets as of September 30, 2023. The following is a schedule of future principal payments for the Company’s total indebtedness for the remainder of 2023, for each of the next four years and thereafter, in the aggregate, as of September 30, 2023 (in thousands): 2023 $ 217 2024 568,968 2025 308 2026 15,542 2027 — Thereafter — $ 585,035 5. Indebtedness (continued) The Company has approximately $548.0 million outstanding under its unsecured Credit Facilities as of the balance sheet date which mature in May 2024. As of the balance sheet date, the Company does not have sufficient cash on hand to satisfy these obligations. Management has been in discussions with existing and potential lenders, and based on the negotiations to date with its lender group, the Company believes it is probable it will be successful in refinancing the amounts outstanding under the Credit Facilities. The Company’s low leverage profile, along with current and anticipated cash flows, are expected to be sufficient to support a refinancing of the current outstanding indebtedness while maintaining reasonable debt service coverage ratios. There can be no assurance that the refinancing will occur or will occur on the terms currently contemplated. If sufficient refinancing cannot be arranged under an unsecured facility to satisfy the outstanding obligations due in May 2024, it may impact the Company’s ability to continue its operations. The Company believes it has other options to meet its obligation. These other options include, but are not limited to, refinancing with lending institutions as a secured loan facility, issuing mortgages collateralized by unencumbered properties in its portfolio and/or selling all or a portion of the 63 unencumbered properties and using net sales proceeds to satisfy the obligation. The following table provides the details of the fair market value and carrying value of the Company’s indebtedness as of September 30, 2023 and December 31, 2022 (in millions): September 30, 2023 December 31, 2022 Fair Value Carrying Value Fair Value Carrying Value Mortgages and other notes payable, net $ 36.0 $ 36.8 $ 60.8 $ 61.8 Credit facilities, net $ 548.0 $ 547.1 $ 548.0 $ 546.1 These fair market values are based on current rates and spreads the Company would expect to obtain for similar borrowings. Since this methodology includes inputs that are less observable by the public and are not necessarily reflected in active markets, the measurement of the estimated fair values related to the Company’s indebtedness is categorized as Level 3 on the three-level valuation hierarchy. Generally, the loan agreements for the Company’s mortgage loans contain customary financial covenants and ratios; including (but not limited to) the following: debt service coverage ratio, minimum occupancy levels, limitations on incurrence of additional indebtedness, etc. The loan agreements also contain customary events of default and remedies for the lenders. As of September 30, 2023, the Company was in compliance with all financial covenants related to its mortgage loans.

Related Party Arrangements

Related Party Arrangements	9 Months Ended
	Sep. 30, 2023
Related Party Transactions [Abstract]
Related Party Arrangements	Related Party Arrangements On June 5, 2023, the Company renewed its Advisory Agreement with the Advisor for an additional two years expiring June 30, 2025 and amended the terms of its advisory agreement with the Advisor. The amendment (i) revised the defined term “real estate asset value” from the greater of to the lesser of cost basis or the current independent valuation (before non-cash reserves and depreciation), and (ii) subordinated 0.05% of the 0.80% per annum asset management fee paid by the Company to the Advisor (based on the monthly average of the sum of the Company’s and the Operating Partnership’s respective daily real estate asset value). The subordinated fee will be forfeited and not paid to the Advisor in the event the Company does not achieve certain performance thresholds during certain measurement periods. Additionally, the Expense Support and Restricted Stock Agreement, as amended, by and between the Company and the Advisor (the “Expense Support Agreement”) was terminated effective June 8, 2023. The Company paid approximately $0.03 million and $0.10 million during the quarter and nine months ended September 30, 2023 and 2022, respectively, of cash distributions on Restricted Stock issued through March 2017 pursuant to the Expense Support Agreement. These amounts have been recognized as compensation expense and included in general and administrative expenses in the accompanying condensed consolidated statements of operations. The termination of the Expense Support Agreement in June 2023 does not impact the previously issued Restricted Stock. The expenses and fees incurred by and reimbursable to the Company’s related parties for the quarter and nine months ended September 30, 2023 and 2022, and related amounts unpaid as of September 30, 2023 and December 31, 2022 are as follows (in thousands): Quarter Ended Nine Months Ended Unpaid amounts as of (1) September 30, September 30, September 30, 2023 December 31, 2022 2023 2022 2023 2022 Reimbursable expenses: Operating expenses (2) $ 687 $ 835 $ 2,081 $ 2,390 $ 203 $ 238 687 835 2,081 2,390 203 238 Investment services fee (3) — — — 60 — — Disposition fee (4) — 127 — 195 — — Financing coordination fees (5) — — 163 — — — Asset management fees 3,476 3,496 10,427 10,598 1,159 1,159 $ 4,163 $ 4,458 $ 12,671 $ 13,243 $ 1,362 $ 1,397 ______________________________ FOOTNOTES: (1) Amounts are recorded as due to related parties in the accompanying condensed consolidated balance sheets. (2) Amounts are recorded as general and administrative expenses in the accompanying condensed consolidated statements of operations unless such amounts represent prepaid expenses, which are capitalized in the accompanying condensed consolidated balance sheets. (3) For the nine months ended September 30, 2022, the Company incurred approximately $0.1 million in investment services fees, all of which was capitalized and included in real estate assets, net in the accompanying condensed consolidated balance sheets. For the quarter and nine months ended September 30, 2023, the Company did not incur any investment services fees. (4) Amounts are recorded as a reduction to gain on sale of real estate in the accompanying condensed consolidated statements of operations. (5) For the nine months ended September 30, 2023, the Company incurred financing coordination fees of approximately $0.2 million, related to the refinancing of the loan associated with five operating properties, all of which was expensed on the accompanying condensed consolidated statement of operations. The Company did not incur any financing coordination fees for the quarter and nine months ended September 30, 2022.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies From time to time, the Company may be a party to legal proceedings in the ordinary course of, or incidental to the normal course of, its business, including proceedings to enforce its contractual or statutory rights. While the Company cannot predict the outcome of these legal proceedings with certainty, based upon currently available information, the Company does not believe the final outcome of any pending or threatened legal proceeding will have a material adverse effect on its results of operations or financial condition. As a result of the Company’s completed seniors housing developments continuing to move towards or achieving stabilization, the Company monitors the lease-up of these properties to determine whether the established performance metrics have been met as of each reporting period. As of September 30, 2023, the Company did not have any remaining promoted interest agreements with third-party developers as the one remaining promoted interest agreement expired in July 2023. The Company’s Advisor has approximately 1.3 million contingently issuable Restricted Stock shares for financial reporting purposes that were issued pursuant to the Advisor Expense Support Agreement. Refer to Note 6. “Related Party Arrangements”

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net Income (Loss) Attributable to Parent	$ (5,414)	$ 322	$ (16,580)	$ 4,626

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Basis of Presentation and Consolidation	Basis of Presentation and Consolidation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the U.S. (“GAAP”). The unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which, in the opinion of management, are necessary for the fair statement of the Company’s results for the interim period presented. Operating results for the nine months ended September 30, 2023 may not be indicative of the results that may be expected for the year ending December 31, 2023. Amounts as of December 31, 2022 included in the unaudited condensed consolidated financial statements have been derived from audited consolidated financial statements as of that date but do not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The accompanying unaudited condensed consolidated financial statements include the Company’s accounts, the accounts of wholly owned subsidiaries or subsidiaries for which the Company has a controlling interest, the account s of v ariable interest entities (“VIEs”) in which the Company is the primary beneficiary, and the accounts of other subsidiaries over which the Company has a controlling financial interest. All material intercompany accounts and transactions have been eliminated in consolidation.
Grant Income	Grant Income —
Use of Estimates	Use of Estimates — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated financial statements, the reported amounts of revenues and expenses during the reporting periods and the disclosure of contingent liabilities. For example, significant assumptions are made in the analysis of real estate impairments, the valuation of contingent assets and liabilities, and the valuation of restricted common stock (“Restricted Stock”) shares issued to the Advisor. Accordingly, actual results could differ from those estimates.
Variable Interest Entities	Variable Interest Entities — As of December 31, 2022, the Company had net assets in two subsidiaries classified as VIEs. The Company determined it was the primary beneficiary and held a controlling financial interest in the subsidiaries due to its power to direct the activities that most significantly impact the economic performance of these entities, as well as its obligation to absorb the losses and its right to receive benefits from these entities that could potentially be significant to these entities. As such, the transactions and accounts of these VIEs were included in the accompanying condensed consolidated financial statements. The Company sold the property owned by one of these subsidiaries in August 2022, dissolved the subsidiary during the nine months ended September 30, 2023 and as of September 30, 2023, had one remaining subsidiary classified as a VIE. The Company’s maximum exposure to loss as a result of its involvement with this VIE is limited to its net investment in this entity which totaled approximately $8.5 million

Revenue (Tables)

Revenue (Tables)	9 Months Ended
	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Summary of Disaggregation of Revenue	The following table presents disaggregated revenue related to the Company’s resident fees and services during the quarter and nine months ended September 30, 2023 and 2022: Quarter Ended September 30, Number of Units Revenues (in millions) Percentage of Revenues Resident fees and services: 2023 2022 2023 2022 2023 2022 Independent living 2,222 2,223 $ 20.4 $ 18.7 25.7 % 25.0 % Assisted living 3,039 3,041 39.5 37.3 49.7 49.9 Memory care 932 932 15.5 15.1 19.5 20.2 Other revenues — — 4.1 3.7 5.1 4.9 6,193 6,196 $ 79.5 $ 74.8 100.0 % 100.0 % Nine Months Ended September 30, Number of Units Revenues (in millions) Percentage of Revenues Resident fees and services: 2023 2022 2023 2022 2023 2022 Independent living 2,222 2,223 $ 60.0 $ 55.1 25.5 % 24.9 % Assisted living 3,039 3,041 117.1 109.5 49.9 49.7 Memory care 932 932 46.1 45.6 19.6 20.6 Other revenues — — 11.7 10.7 5.0 4.8 6,193 6,196 $ 234.9 $ 220.9 100.0 % 100.0 %

Real Estate Assets, net (Tables

Real Estate Assets, net (Tables)	9 Months Ended
	Sep. 30, 2023
Real Estate [Abstract]
Schedule of Real Estate Investment Properties Excluding Assets Held For Sale	The gross carrying amount and accumulated depreciation of the Company’s real estate assets as of September 30, 2023 and December 31, 2022 are as follows (in thousands): September 30, December 31, Land and land improvements $ 136,984 $ 136,416 Building and building improvements 1,499,634 1,495,552 Furniture, fixtures and equipment 110,984 105,784 Less: accumulated depreciation (461,395) (424,314) Real estate investment properties, net $ 1,286,207 $ 1,313,438

Indebtedness (Tables)

Indebtedness (Tables)	9 Months Ended
	Sep. 30, 2023
Debt Disclosure [Abstract]
Schedule of Maturities of Indebtedness	The following is a schedule of future principal payments for the Company’s total indebtedness for the remainder of 2023, for each of the next four years and thereafter, in the aggregate, as of September 30, 2023 (in thousands): 2023 $ 217 2024 568,968 2025 308 2026 15,542 2027 — Thereafter — $ 585,035
Schedule of Fair Market Value and Carrying Value of Indebtedness	The following table provides the details of the fair market value and carrying value of the Company’s indebtedness as of September 30, 2023 and December 31, 2022 (in millions): September 30, 2023 December 31, 2022 Fair Value Carrying Value Fair Value Carrying Value Mortgages and other notes payable, net $ 36.0 $ 36.8 $ 60.8 $ 61.8 Credit facilities, net $ 548.0 $ 547.1 $ 548.0 $ 546.1

Related Party Arrangements (Tab

Related Party Arrangements (Tables)	9 Months Ended
	Sep. 30, 2023
Related Party Transactions [Abstract]
Schedule of Fees, Reimbursable Expenses and Related Amounts Unpaid to Related Parties	The expenses and fees incurred by and reimbursable to the Company’s related parties for the quarter and nine months ended September 30, 2023 and 2022, and related amounts unpaid as of September 30, 2023 and December 31, 2022 are as follows (in thousands): Quarter Ended Nine Months Ended Unpaid amounts as of (1) September 30, September 30, September 30, 2023 December 31, 2022 2023 2022 2023 2022 Reimbursable expenses: Operating expenses (2) $ 687 $ 835 $ 2,081 $ 2,390 $ 203 $ 238 687 835 2,081 2,390 203 238 Investment services fee (3) — — — 60 — — Disposition fee (4) — 127 — 195 — — Financing coordination fees (5) — — 163 — — — Asset management fees 3,476 3,496 10,427 10,598 1,159 1,159 $ 4,163 $ 4,458 $ 12,671 $ 13,243 $ 1,362 $ 1,397 ______________________________ FOOTNOTES: (1) Amounts are recorded as due to related parties in the accompanying condensed consolidated balance sheets. (2) Amounts are recorded as general and administrative expenses in the accompanying condensed consolidated statements of operations unless such amounts represent prepaid expenses, which are capitalized in the accompanying condensed consolidated balance sheets. (3) For the nine months ended September 30, 2022, the Company incurred approximately $0.1 million in investment services fees, all of which was capitalized and included in real estate assets, net in the accompanying condensed consolidated balance sheets. For the quarter and nine months ended September 30, 2023, the Company did not incur any investment services fees. (4) Amounts are recorded as a reduction to gain on sale of real estate in the accompanying condensed consolidated statements of operations. (5) For the nine months ended September 30, 2023, the Company incurred financing coordination fees of approximately $0.2 million, related to the refinancing of the loan associated with five operating properties, all of which was expensed on the accompanying condensed consolidated statement of operations. The Company did not incur any financing coordination fees for the quarter and nine months ended September 30, 2022.

Organization (Details)

Organization (Details)	9 Months Ended	12 Months Ended
	Sep. 30, 2023 agreement property State	Dec. 31, 2022 property	Dec. 31, 2017 property
MOB/Healthcare Portfolio
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Number of properties			70
Number of properties sold		70
Investment Portfolio
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Number of properties	70
Number of states | State	26
Number of seniors housing properties	69
Investment Portfolio | Vacant Land Parcel
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items]
Number of properties | agreement	1

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details) $ in Millions	9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($) Subsidiary	Sep. 30, 2022 USD ($)	Dec. 31, 2022 Subsidiary
Summary Of Significant Accounting Policies [Line Items]
Maximum exposure to loss VIEs limits	$ 8.5
Provider Relief Fund | COVID19
Summary Of Significant Accounting Policies [Line Items]
Grant income received	$ 1	$ 3.9
VIEs | Joint Ventures Real Estate Under Development Entities
Summary Of Significant Accounting Policies [Line Items]
Number of subsidiaries | Subsidiary	1		2

Revenue - Summary of Disaggrega

Revenue - Summary of Disaggregation of Revenue (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($) Facility	Sep. 30, 2022 USD ($) Facility	Sep. 30, 2023 USD ($) Facility	Sep. 30, 2022 USD ($) Facility
Disaggregation Of Revenue [Line Items]
Number of Units | Facility	6,193	6,196	6,193	6,196
Revenues | $	$ 79,483	$ 74,824	$ 234,892	$ 220,888
Percentage of Revenues	100%	100%	100%	100%
Independent living
Disaggregation Of Revenue [Line Items]
Number of Units | Facility	2,222	2,223	2,222	2,223
Revenues | $	$ 20,400	$ 18,700	$ 60,000	$ 55,100
Percentage of Revenues	25.70%	25%	25.50%	24.90%
Assisted living
Disaggregation Of Revenue [Line Items]
Number of Units | Facility	3,039	3,041	3,039	3,041
Revenues | $	$ 39,500	$ 37,300	$ 117,100	$ 109,500
Percentage of Revenues	49.70%	49.90%	49.90%	49.70%
Memory care
Disaggregation Of Revenue [Line Items]
Number of Units | Facility	932	932	932	932
Revenues | $	$ 15,500	$ 15,100	$ 46,100	$ 45,600
Percentage of Revenues	19.50%	20.20%	19.60%	20.60%
Other revenues
Disaggregation Of Revenue [Line Items]
Number of Units | Facility	0	0	0	0
Revenues | $	$ 4,100	$ 3,700	$ 11,700	$ 10,700
Percentage of Revenues	5.10%	4.90%	5%	4.80%

Real Estate Assets, Net - Sched

Real Estate Assets, Net - Schedule of Real Estate Investment Properties Excluding Assets Held For Sale (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Real Estate [Abstract]
Land and land improvements	$ 136,984	$ 136,416
Building and building improvements	1,499,634	1,495,552
Furniture, fixtures and equipment	110,984	105,784
Less: accumulated depreciation	(461,395)	(424,314)
Real estate investment properties, net	$ 1,286,207	$ 1,313,438

Real Estate Assets, Net - Narra

Real Estate Assets, Net - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Real Estate [Abstract]
Depreciation expense	$ 12.5	$ 12.4	$ 37.6	$ 38.2

Indebtedness - Narrative (Detai

Indebtedness - Narrative (Details) $ in Thousands	1 Months Ended	6 Months Ended	9 Months Ended
	Jun. 30, 2023 USD ($) Extension	Jun. 30, 2023 USD ($) property	Sep. 30, 2023 USD ($) property	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Line of Credit Facility [Line Items]
Repayments of debt			$ 25,100
Number of properties held as collateral | property			1
Long term line of credit, extension option			1 year
Credit facilities			$ 547,127		$ 546,100
Scheduled payments due			217
Indebtedness			585,035
Purchase of interest rate cap			$ 3,211	$ 0
Number of unencumbered properties | property			63
Maximum allowable distributions as a percentage of adjusted FFO			95%
Interest Rate Cap Maturing August 2023
Line of Credit Facility [Line Items]
Purchase of interest rate cap			$ 3,100
Notional amounts of derivative contract			$ 420,000
Strike rate (as a percent)			3.50%
Fair value of interest rate cap			$ 40
Interest Rate Cap Maturing January 2024
Line of Credit Facility [Line Items]
Purchase of interest rate cap			100
Notional amounts of derivative contract			$ 8,000
Strike rate (as a percent)			3.50%
Unscheduled Principal Payments
Line of Credit Facility [Line Items]
Secured debt, number of properties | property		5
Scheduled Principal Payments
Line of Credit Facility [Line Items]
Repayments of debt			$ 900
Secured debt, number of properties | property		5
Mortgage Loan
Line of Credit Facility [Line Items]
Repayments of debt			22,800
Indebtedness	$ 16,100	$ 16,100
Number of extension options | Extension	2
Extension option term	1 year
Mortgage Loan | Unscheduled Principal Payments
Line of Credit Facility [Line Items]
Repayments of debt			1,400
Secured Debt
Line of Credit Facility [Line Items]
Debt outstanding under credit facilities	$ 16,300	$ 16,300
Revolving Credit Facility
Line of Credit Facility [Line Items]
Credit facilities			133,000
Credit facilities
Line of Credit Facility [Line Items]
Indebtedness			547,100		546,100
Debt outstanding under credit facilities			$ 548,000		$ 548,000

Indebtedness - Schedule of Matu

Indebtedness - Schedule of Maturities of Indebtedness (Details) $ in Thousands	Sep. 30, 2023 USD ($)
Debt Disclosure [Abstract]
2023	$ 217
2024	568,968
2025	308
2026	15,542
2027	0
Thereafter	0
Total	$ 585,035

Indebtedness - Schedule of Fair

Indebtedness - Schedule of Fair Market Value and Carrying Value of Indebtedness (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Carrying Value	$ 585,035
Mortgages and other notes payable, net
Debt Instrument [Line Items]
Fair Value	36,000	$ 60,800
Carrying Value	36,800	61,800
Credit facilities
Debt Instrument [Line Items]
Fair Value	548,000	548,000
Carrying Value	$ 547,100	$ 546,100

Related Party Arrangements - Na

Related Party Arrangements - Narrative (Details) $ in Thousands		3 Months Ended		9 Months Ended
	Jun. 05, 2023	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)
Related Party Transaction [Line Items]
Cash distributions on restricted stock				$ 13,360	$ 13,360
Related Party
Related Party Transaction [Line Items]
Advisory agreement, term	2 years
Percentage of assets management fee, subordinated	0.0005
Percentage of asset management fee	0.80%
Expense Support Agreements | Restricted Stock | Related Party
Related Party Transaction [Line Items]
Cash distributions on restricted stock		$ 30	$ 100	$ 30	$ 100

Related Party Arrangements - Sc

Related Party Arrangements - Schedule of Fees, Reimbursable Expenses and Related Amounts Unpaid to Related Parties (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) property	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Related Party Transaction [Line Items]
Financing coordination fees	$ 0	$ 0	$ 163	$ 0
Related Party
Related Party Transaction [Line Items]
Operating expenses	687	835	2,081	2,390
Total reimbursable expenses	687	835	2,081	2,390
Investment services fee	0	0	0	60
Disposition fee	0	127	0	195
Financing coordination fees	0	0	163	0
Asset management fees	3,476	3,496	10,427	10,598
Total reimbursable expenses, net	4,163	$ 4,458	12,671	13,243
Operating expenses, unpaid	203		203		$ 238
Total reimbursable expenses, unpaid	203		203		238
Investment services fees, unpaid	0		0		0
Disposition fees, unpaid	0		0		0
Financing coordination fees, unpaid	0		0		0
Asset management fees, unpaid	1,159		1,159		1,159
Total reimbursable expenses, unpaid, net	1,362		1,362		$ 1,397
Investment services fees	$ 0		$ 0	$ 100
Number of properties | property			5

Commitments and Contingencies (

Commitments and Contingencies (Details) shares in Millions	9 Months Ended
	Sep. 30, 2023 agreement shares	Jul. 31, 2023 agreement
Commitments And Contingencies [Line Items]
Number of promoted interest agreements | agreement	0	1
Advisor Expense Support Agreement | Restricted Stock
Commitments And Contingencies [Line Items]
Contingently issuable restricted stock shares | shares	1.3