Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 31, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-36499 | |
Entity Registrant Name | New Senior Investment Group Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 80-0912734 | |
Entity Address, Address Line One | 55 West 46th Street | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10036 | |
City Area Code | (646) | |
Local Phone Number | 822-3700 | |
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Trading Symbol | SNR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 83,023,846 | |
Entity Central Index Key | 0001610114 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Real estate investments: | ||
Land | $ 134,643 | $ 134,643 |
Buildings, improvements and other | 1,973,699 | 1,970,036 |
Accumulated depreciation | (385,667) | (351,555) |
Net real estate property | 1,722,675 | 1,753,124 |
Acquired lease and other intangible assets | 7,642 | 7,642 |
Accumulated amortization | (2,416) | (2,238) |
Net real estate intangibles | 5,226 | 5,404 |
Net real estate investments | 1,727,901 | 1,758,528 |
Assets from discontinued operations | 0 | 363,489 |
Cash and cash equivalents | 102,325 | 39,614 |
Receivables and other assets, net | 31,508 | 33,078 |
Total Assets | 1,861,734 | 2,194,709 |
Liabilities | ||
Debt, net | 1,546,764 | 1,590,632 |
Liabilities from discontinued operations | 0 | 267,856 |
Accrued expenses and other liabilities | 57,823 | 59,320 |
Total Liabilities | 1,604,587 | 1,917,808 |
Commitments and contingencies (Note 14) | ||
Redeemable preferred stock, $0.01 par value with $100 liquidation preference, 400,000 shares authorized, issued and outstanding as of both June 30, 2020 and December 31, 2019 | 40,500 | 40,506 |
Equity | ||
Preferred stock, $0.01 par value, 99,600,000 shares (excluding 400,000 shares of redeemable preferred stock) authorized, none issued or outstanding as of both June 30, 2020 and December 31, 2019 | 0 | 0 |
Common stock, $0.01 par value, 2,000,000,000 shares authorized, 83,023,396 and 82,964,438 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively | 830 | 830 |
Additional paid-in capital | 904,135 | 901,889 |
Accumulated deficit | (674,626) | (660,588) |
Accumulated other comprehensive loss | (13,692) | (5,736) |
Total Equity | 216,647 | 236,395 |
Total Liabilities, Redeemable Preferred Stock and Equity | $ 1,861,734 | $ 2,194,709 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Redeemable preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Redeemable preferred stock, liquidation preference per share (in dollars per share) | $ 100 | $ 100 |
Redeemable preferred stock, shares authorized (in shares) | 400,000 | 400,000 |
Redeemable preferred stock, shares issued (in shares) | 400,000 | 400,000 |
Redeemable preferred stock, shares outstanding (in shares) | 400,000 | 400,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 99,600,000 | 99,600,000 |
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) | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 83,023,396 | 82,964,438 |
Common stock, shares outstanding (in shares) | 83,023,396 | 82,964,438 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | ||||
Revenues | |||||||
Total revenues | $ 84,533 | $ 86,404 | $ 171,123 | $ 173,735 | |||
Expenses | |||||||
Property operating expense | 48,760 | 50,693 | 99,825 | 103,632 | |||
Interest expense | 15,281 | 19,570 | 32,500 | 39,420 | |||
Depreciation and amortization | 16,782 | 16,987 | 34,318 | 33,981 | |||
General and administrative expense | 5,894 | 5,359 | 11,740 | 10,337 | |||
Acquisition, transaction and integration expense | 19 | 174 | 152 | 666 | |||
Loss on extinguishment of debt | 0 | 335 | 5,884 | 335 | |||
Other expense | 433 | 62 | 328 | 1,377 | |||
Total expenses | 87,169 | 93,180 | 184,747 | 189,748 | |||
Loss on sale of real estate | 0 | (122) | 0 | (122) | |||
Loss before income taxes | (2,636) | (6,898) | (13,624) | (16,135) | |||
Income tax expense | 22 | 37 | 82 | 73 | |||
Loss from continuing operations | (2,658) | (6,935) | (13,706) | (16,208) | |||
Discontinued Operations: | |||||||
Gain on sale of real estate | 0 | 0 | 19,992 | 0 | |||
Loss from discontinued operations | 0 | (2,651) | (3,107) | (4,571) | |||
Discontinued operations, net | 0 | (2,651) | 16,885 | (4,571) | |||
Net income (loss) | (2,658) | (9,586) | 3,179 | (20,779) | |||
Deemed dividend on redeemable preferred stock | (599) | (599) | (1,197) | (1,197) | |||
Net income (loss) attributable to common stockholders | $ (3,257) | $ (10,185) | $ 1,982 | $ (21,976) | |||
Basic earnings per common share: | |||||||
Loss from continuing operations attributable to common stockholders (in dollars per share) | [1] | $ (0.04) | $ (0.09) | $ (0.18) | $ (0.21) | ||
Discontinued operations, net (in dollars per share) | [1] | 0 | (0.03) | 0.20 | (0.06) | ||
Net income (loss) attributable to common stockholders, basic (in dollars per share) | [1] | (0.04) | (0.12) | 0.02 | (0.27) | ||
Diluted earnings per common share: (A) | |||||||
Loss from continuing operations attributable to common stockholders (in dollars per share) | [1] | (0.04) | (0.09) | (0.18) | (0.21) | ||
Discontinued operations, net (in dollars per share) | [1] | 0 | (0.03) | 0.20 | (0.06) | ||
Net income (loss) attributable to common stockholders, diluted (in dollars per share) | [1] | $ (0.04) | $ (0.12) | $ 0.02 | $ (0.27) | ||
Weighted average number of shares of common stock outstanding | |||||||
Basic and diluted (in shares) | [2] | 82,459,741 | 82,209,844 | 82,423,182 | 82,206,475 | ||
Dividends declared and paid per share of common stock (in dollars per share) | $ 0.07 | $ 0.13 | $ 0.20 | [2] | $ 0.26 | [2] | |
Restricted stock awards issued (in shares) | 454,921 | 916,415 | |||||
Resident fees and services | |||||||
Revenues | |||||||
Total revenues | $ 82,951 | $ 84,821 | $ 167,958 | $ 170,570 | |||
Rental revenue | |||||||
Revenues | |||||||
Total revenues | $ 1,582 | $ 1,583 | $ 3,165 | $ 3,165 | |||
[1] | Basic earnings per common share (“EPS”) is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding. The outstanding shares used to calculate the weighted average basic shares exclude 454,921 and 916,415 restricted stock awards, net of forfeitures, as of June 30, 2020 and 2019, respectively, as those shares were issued but were not vested and therefore, not considered outstanding for purposes of computing basic EPS share. Diluted EPS is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding plus the additional dilutive effect, if any, of common stock equivalents during each period. | ||||||
[2] | Dilutive share equivalents and options were excluded for the three and six months ended June 30, 2020 and 2019 as their inclusion would have been anti-dilutive given our loss position. |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (2,658) | $ (9,586) | $ 3,179 | $ (20,779) |
Other comprehensive income (loss): | ||||
Unrealized gain (loss) on cash flow hedge | 762 | (6,264) | (7,956) | (6,264) |
Total other comprehensive loss | 762 | (6,264) | (7,956) | (6,264) |
Total comprehensive loss | $ (1,896) | $ (15,850) | $ (4,777) | $ (27,043) |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Accumulated Deficit | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) |
Equity (in shares) at Dec. 31, 2018 | 82,148,869 | ||||
Equity at Dec. 31, 2018 | $ 282,452 | $ 821 | $ (616,504) | $ 898,135 | $ 0 |
Increase (Decrease) in Equity [Roll Forward] | |||||
Restricted stock awards issued (shares) | 916,415 | ||||
Restricted stock awards issued | 0 | $ 9 | (9) | ||
Amortization of equity-based compensation | 986 | 986 | |||
Directors shares issued (in shares) | 60,975 | ||||
Directors shares issued | 275 | $ 1 | 274 | ||
Dividends declared - common stock | (21,375) | (21,375) | |||
Dividends declared - equity awards | (223) | (223) | |||
Deemed dividend on redeemable preferred stock | (500) | (500) | |||
Dividends declared on redeemable preferred stock | (697) | (697) | |||
Other comprehensive loss | (6,264) | (6,264) | |||
Net income (loss) | (20,779) | (20,779) | |||
Equity (in shares) at Jun. 30, 2019 | 83,126,259 | ||||
Equity at Jun. 30, 2019 | 233,875 | $ 831 | (660,078) | 899,386 | (6,264) |
Equity (in shares) at Mar. 31, 2019 | 82,209,844 | ||||
Equity at Mar. 31, 2019 | 260,594 | $ 822 | (639,086) | 898,858 | 0 |
Increase (Decrease) in Equity [Roll Forward] | |||||
Restricted stock awards issued (shares) | 916,415 | ||||
Restricted stock awards issued | 0 | $ 9 | (9) | ||
Amortization of equity-based compensation | 537 | 537 | |||
Dividends declared - common stock | (10,688) | (10,688) | |||
Dividends declared - equity awards | (119) | (119) | |||
Deemed dividend on redeemable preferred stock | (500) | (500) | |||
Dividends declared on redeemable preferred stock | (99) | (99) | |||
Other comprehensive loss | (6,264) | (6,264) | |||
Net income (loss) | (9,586) | (9,586) | |||
Equity (in shares) at Jun. 30, 2019 | 83,126,259 | ||||
Equity at Jun. 30, 2019 | $ 233,875 | $ 831 | (660,078) | 899,386 | (6,264) |
Equity (in shares) at Dec. 31, 2019 | 82,964,438 | 82,964,438 | |||
Equity at Dec. 31, 2019 | $ 236,395 | $ 830 | (660,588) | 901,889 | (5,736) |
Increase (Decrease) in Equity [Roll Forward] | |||||
Equity awards vested (shares) | 119,796 | ||||
Equity awards vested | 1 | $ 1 | |||
Shares repurchased and retired to satisfy tax withholding upon vesting (shares) | (121,240) | ||||
Shares repurchased and retired to satisfy tax withholding upon vesting | (1,051) | $ (1) | (1,050) | ||
Amortization of equity-based compensation | 3,116 | 3,116 | |||
Directors shares issued (in shares) | 60,402 | ||||
Directors shares issued | 180 | $ 0 | 180 | ||
Dividends declared - common stock | (16,077) | (16,077) | |||
Dividends declared - equity awards | 57 | 57 | |||
Deemed dividend on redeemable preferred stock | (500) | (500) | |||
Dividends declared on redeemable preferred stock | (697) | (697) | |||
Other comprehensive loss | (7,956) | (7,956) | |||
Net income (loss) | $ 3,179 | 3,179 | |||
Equity (in shares) at Jun. 30, 2020 | 83,023,396 | 83,023,396 | |||
Equity at Jun. 30, 2020 | $ 216,647 | $ 830 | (674,626) | 904,135 | (13,692) |
Equity (in shares) at Mar. 31, 2020 | 82,880,222 | ||||
Equity at Mar. 31, 2020 | 222,239 | $ 829 | (666,424) | 902,288 | (14,454) |
Increase (Decrease) in Equity [Roll Forward] | |||||
Equity awards vested (shares) | 96,659 | ||||
Equity awards vested | 1 | $ 1 | |||
Shares repurchased and retired to satisfy tax withholding upon vesting (shares) | (13,887) | ||||
Shares repurchased and retired to satisfy tax withholding upon vesting | (52) | $ 0 | (52) | ||
Amortization of equity-based compensation | 1,719 | 1,719 | |||
Directors shares issued (in shares) | 60,402 | ||||
Directors shares issued | 180 | $ 0 | 180 | ||
Dividends declared - common stock | (5,369) | (5,369) | |||
Dividends declared - equity awards | 424 | 424 | |||
Deemed dividend on redeemable preferred stock | (500) | (500) | |||
Dividends declared on redeemable preferred stock | (99) | (99) | |||
Other comprehensive loss | 762 | 762 | |||
Net income (loss) | $ (2,658) | (2,658) | |||
Equity (in shares) at Jun. 30, 2020 | 83,023,396 | 83,023,396 | |||
Equity at Jun. 30, 2020 | $ 216,647 | $ 830 | $ (674,626) | $ 904,135 | $ (13,692) |
CONSOLIDATED STATEMENT OF CHA_2
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Dividends declared (in dollars per share) | $ 0.065 | $ 0.13 | $ 0.195 | $ 0.26 |
Equity awards, dividends, per share, declared | $ 0.065 | $ 0.13 | $ 0.26 | |
Minimum | ||||
Equity awards, dividends, per share, declared | 0.065 | |||
Maximum | ||||
Equity awards, dividends, per share, declared | $ 0.195 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | ||
Cash Flows From Operating Activities | |||
Net income (loss) | $ 3,179 | $ (20,779) | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation of tangible assets and amortization of intangible assets | 34,318 | 33,981 | |
Amortization of deferred financing costs | 1,614 | 1,498 | |
Amortization of deferred revenue, net | (416) | 1,071 | |
Non-cash straight-line rental revenue | (242) | (321) | |
Loss on extinguishment of debt | 5,884 | 335 | |
Amortization of equity-based compensation | 3,116 | 986 | |
(Gain) Loss on sale of real estate | (19,992) | 122 | |
Other non-cash expense | 776 | 1,133 | |
Changes in: | |||
Receivables and other assets, net | 1,637 | (328) | |
Accrued expenses and other liabilities | (12,136) | (19,344) | |
Net cash provided by (used in) operating activities - continuing operations | 17,738 | (1,646) | |
Net cash provided by (used in) operating activities - discontinued operations | (3,105) | 6,512 | |
Net cash provided by operating activities | 14,633 | 4,866 | |
Cash Flows From Investing Activities | |||
Proceeds from sale of real estate | 0 | 13,086 | |
Capital expenditures, net of insurance proceeds | (3,926) | (10,132) | |
Net cash provided by (used in) investing activities - continuing operations | (3,926) | 2,954 | |
Net cash provided by (used in) investing activities - discontinued operations | [1] | 373,805 | (3,906) |
Net cash provided by (used in) investing activities | 369,879 | (952) | |
Cash Flows From Financing Activities | |||
Principal payments of mortgage notes payable and capital lease obligations | (1,344) | (3,392) | |
Proceeds from mortgage notes payable | 270,015 | 0 | |
Proceeds from borrowings on the revolving credit facility | 100,000 | 0 | |
Repayments of borrowings on the revolving credit facility | (40,000) | 0 | |
Repayments of mortgage notes payable and capital lease obligations | (369,000) | (13,674) | |
Payment of exit fee on extinguishment of debt | (4,504) | (206) | |
Payment of deferred financing costs | (4,704) | (799) | |
Purchase of interest rate caps | (81) | (35) | |
Taxes paid for net settlement of equity-based compensation awards | (1,050) | 0 | |
Payment of common stock dividend | (16,077) | (21,375) | |
Payment of redeemable preferred stock dividend | (1,203) | (697) | |
Payment of restricted stock dividend | (279) | 0 | |
Net cash used in financing activities - continuing operations | (68,227) | (40,178) | |
Net cash provided by (used in) financing activities - discontinued operations | [2] | (260,996) | 2,199 |
Net cash used in financing activities | (329,223) | (37,979) | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 55,289 | (34,065) | |
Cash, cash equivalents and restricted cash, beginning of period | 63,829 | 92,656 | |
Cash, cash equivalents and restricted cash, end of period | 119,118 | 58,591 | |
Supplemental Disclosure of Cash Flow Information | |||
Cash paid during the period for interest expense | 34,236 | 44,963 | |
Cash paid during the period for income taxes | 263 | 344 | |
Supplemental Disclosure of Non-Cash Investing and Financing Activities | |||
Issuance of common stock | 180 | 275 | |
Capital lease obligations | 474 | 345 | |
Reconciliation of Cash, Cash Equivalents and Restricted Cash | |||
Cash, cash equivalents and restricted cash, end of period | $ 119,118 | $ 58,591 | |
[1] | For the six months ended June 30, 2020, amount primarily consists of net proceeds from the AL/MC Portfolio Disposition. Refer to “Note 4 - Dispositions” for details. | ||
[2] | For the six months ended June 30, 2020, amount primarily consists of repayments of debt in conjunction with the AL/MC Portfolio Disposition. Refer to “Note 4 - Dispositions” for details. |
ORGANIZATION
ORGANIZATION | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATION New Senior is a REIT primarily focused on investing in private pay senior housing properties. As of June 30, 2020, we owned a geographically diversified portfolio of 103 primarily private pay senior housing properties located across 36 states. We are listed on the New York Stock Exchange (“NYSE”) under the symbol “SNR” and are headquartered in New York, New York. We operate in two reportable segments: (1) Managed Independent Living (“IL”) Properties, and (2) Other Properties. Managed IL Properties – We own 102 properties managed by Holiday, FHC Property Management LLC (together with its subsidiaries, “Merrill Gardens”), and Grace Management, Inc. (“Grace”) (collectively, the “Property Managers”), under property management agreements (collectively, the “Property Management Agreements”). Under the Property Management Agreements, the Property Managers are responsible for the day-to-day operations of our senior housing properties and are entitled to a management fee in accordance with the terms of the Property Management Agreements. Our Property Management Agreements have initial five-year or ten-year terms, with successive, automatic one Other Properties – We own one continuing care retirement community (“CCRC”) and lease this property to Watermark Retirement Communities, Inc. (“Watermark”), a healthcare operating company under a triple net lease agreement. In a triple net lease arrangement, the lessee agrees to operate and maintain the property at its own expense, including maintenance, utilities, taxes, insurance, repairs, capital improvements and the payroll expense of property-level employees. Our triple net lease agreement has an initial term of 15 years and includes a renewal option and annual rent increases ranging from 2.75% to 3.25%. We were formed as a Delaware limited liability company on May 17, 2012 as a wholly owned subsidiary of Drive Shack Inc., formerly Newcastle Investment Corp. (“Drive Shack”). On November 6, 2014, we were spun-off from Drive Shack and our shares of common stock were publicly listed on the NYSE. Coronavirus (COVID-19) global pandemic The novel coronavirus (COVID-19) global pandemic is causing significant disruptions to the U.S. and global economies and has contributed to volatility and negative pressure in financial markets. During the three and six months ended June 30, 2020, we incurred $1.4 million and $1.9 million of COVID-19 related costs, respectively, which were recorded in “Property operating expense” in our Consolidated Statements of Operations. These costs mainly consist of personal protective equipment (“PPE”) and other supplies such as packaging necessary for in-room meal deliveries to our residents. During the six months ended June 30, 2020, we saw these costs continue, but they have been largely offset by variable expense savings associated with lower occupancy and strong expense management from our operators. Depending upon how the pandemic continues to evolve, there may be other future operating expenses that we may be required to bear, such as costs for testing kits for residents and staff, temperature screening machines, additional cleaning equipment, or protocols related to the properties, however, the full extent to which the pandemic will directly or indirectly impact our business including revenues, expenses, value of our real estate, collectability of receivables and operating cash flows is highly uncertain and difficult to predict. A general economic downturn resulting from COVID-19 and measures taken to contain it that persists over a long period of time could have a prolonged negative impact on our financial condition and results of operations. As the extent and duration of the increasingly broad effects of COVID-19 on the U.S. economy remains unclear, it is difficult for us to assess and estimate its impact on our results of operations at this time. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP’’) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for financial statements. The consolidated financial statements include the accounts of New Senior and its consolidated subsidiaries. All significant intercompany transactions and balances have been eliminated. We consolidate those entities in which we have control over significant operating, financial and investing decisions of the entity. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019, as filed with the SEC. Certain prior period amounts have been reclassified to conform to the current period’s presentation, primarily related to the classification of certain properties as discontinued operations. Significant Accounting Policies Earnings per Common Share The two-class method determines EPS for each class of common stock and participating securities according to dividends declared (or accumulated) and their respective participation rights in undistributed earnings. Non-vested share-based payment awards that contain non-forfeitable rights to dividends are participating securities and, therefore are included in the computation of basic EPS pursuant to the two-class method. During the six months ended June 30, 2020, we issued 435,316 unvested restricted stock units to officers, employees and non-employee directors with certain participating rights (“Participating RSUs”). Diluted earnings per share of common stock is calculated by including the effect of dilutive securities. Participating RSUs are included in the computation of diluted EPS by using the more dilutive of the two-class method or treasury stock method. Any anti-dilutive securities are excluded from the calculation. During periods of loss, there is no allocation required under the two-class method since the participating securities do not have a contractual obligation to fund losses. Refer to our significant accounting policies disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019 for other significant accounting policies. Recently Adopted Accounting Pronouncements On January 1, 2020, we adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). This standard requires a company to recognize an impairment allowance equal to its current estimate of all contractual cash flows that it does not expect to collect from financial assets measured at amortized cost. The adoption of this standard did not have a material impact on our consolidated financial statements as our entire balance of receivables relates to lease agreements with our residents and tenant, which are specifically excluded from this standard. Recently Issued Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). This ASU provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference London Inter-Bank Rate (“LIBOR”) or another rate that is expected to be discontinued. Companies can adopt ASU 2020-04 anytime during the effective period of March 12, 2020 through December 31, 2022. We are currently assessing the provisions of ASU 2020-04 and have not made any hedge accounting elections as of June 30, 2020. If an election is made at a later date, we will apply the provisions of this guidance. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Jun. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On October 31, 2019, we entered into a Purchase and Sale Agreement (the “Sale Agreement”) to sell a portfolio of 28 assisted living/memory care (“AL/MC”) properties for a gross sale price of $385.0 million (the “AL/MC Portfolio Disposition”). The portfolio represented a separate reportable segment at the time and the sale represented a strategic shift that would have a major effect on our operations and financial results. As a result, we classified the assets and liabilities associated with the operations of the 28 AL/MC properties as discontinued operations in our consolidated financial statements. On February 10, 2020, the sale was completed. Refer to “Note 4 - Dispositions” for details. As of December 31, 2019, the assets and liabilities associated with discontinued operations were as follows: December 31, 2019 Assets Real estate investments: Land $ 43,313 Buildings, improvements and other 397,808 Accumulated depreciation (87,719) Net real estate property 353,402 Acquired lease and other intangible assets 996 Accumulated amortization (996) Net real estate intangibles — Net real estate investments 353,402 Receivables and other assets, net 10,087 Assets from discontinued operations $ 363,489 Liabilities Debt, net $ 255,096 Accrued expenses and other liabilities 12,760 Liabilities from discontinued operations $ 267,856 For the three and six months ended June 30, 2020 and 2019, the results of operations associated with discontinued operations are as follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Revenues Resident fees and services $ — $ 29,616 $ 14,024 $ 59,904 Total revenues — 29,616 14,024 59,904 Expenses Property operating expenses — 24,264 11,328 48,672 Interest expense — 3,913 1,361 7,782 Depreciation and amortization — 3,768 — 7,561 Acquisition, transaction, and integration expense — 237 1,037 395 General and administrative expense — 13 8 19 Loss on extinguishment of debt — — 3,602 — Other expense (income) — 45 (204) (25) Total expenses — 32,240 17,132 64,404 Loss before income taxes — (2,624) (3,108) (4,500) Income tax (benefit) expense — 27 (1) 71 Loss from discontinued operations $ — $ (2,651) $ (3,107) $ (4,571) |
DISPOSITIONS
DISPOSITIONS | 6 Months Ended |
Jun. 30, 2020 | |
Dispositions [Abstract] | |
DISPOSITIONS | DISPOSITIONS On February 10, 2020, we completed the AL/MC Portfolio Disposition for a gross sale price of $385.0 million and recognized a gain on sale of $20.0 million, which is recorded in “Gain on sale of real estate” within “Discontinued operations, net” in our Consolidated Statements of Operations for the six months ended June 30, 2020. In conjunction with the sale, we repaid $260.2 million of debt specifically attributable to the properties included in the AL/MC Portfolio Disposition and recognized a loss on extinguishment of debt of $3.6 million, comprising of $2.5 million in prepayment penalties and $1.1 million in the write-off of unamortized deferred financing costs, which is included in “Loss from discontinued operations” in our Consolidated Statements of Operations for the six months ended June 30, 2020. During the three months ended June 30, 2019, we sold two AL/MC assets that were previously included in the Managed AL/MC Properties segment for a combined sale price of $13.8 million, and recognized a loss on sale of $0.1 million, which is included in “Loss on sale of real estate” in our Consolidated Statements of Operations for the three and six months ended June 30, 2019. In connection with these dispositions, we repaid $13.7 million of debt. Prior to the sale, both assets were classified as “Assets held for sale” and included in “Receivables and other assets, net” in the Consolidated Balance Sheets. |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTINGWe operate in two reportable business segments, Managed IL Properties and Other Properties. Our Managed IL Properties segment includes 102 IL properties throughout the United States managed by Holiday, Merrill Gardens and Grace under Property Management Agreements. Our Other Properties segment includes one CCRC, which is currently leased to a healthcare operating company under a triple net lease agreement that obligates the tenant to pay all property-related expenses, including maintenance, utilities, taxes, insurance, repairs, capital improvements and the payroll expense of property-level employees. It also includes the operations of two managed AL/MC properties we previously owned and sold during the three and six months ended June 30, 2019. We evaluate performance of the combined properties in each reportable business segment based on segment NOI. We define NOI as total revenues less property-level operating expenses, which include property management fees and travel cost reimbursements. We believe that net income, as defined by GAAP, is the most appropriate earnings measurement. However, we believe that segment NOI serves as a useful supplement to net income because it allows investors, analysts and management to measure unlevered property-level operating results and to compare our operating results between periods and to the operating results of other real estate companies on a consistent basis. Segment NOI should not be considered as an alternative to net income as determined in accordance with GAAP. Depreciation and amortization, interest expense, acquisition, transaction and integration expense, termination fee, management fees and incentive compensation to affiliate, general and administrative expense, loss on extinguishment of debt, impairment of real estate, other expense (income), gain (loss) on sale of real estate, gain on lease termination, litigation proceeds, net, income tax expense (benefit) and discontinued operations, net are not allocated to individual segments for purposes of assessing segment performance. There are no intersegment sales. Three Months Ended June 30, 2020 Three Months Ended June 30, 2019 Managed IL Properties Other Properties Consolidated Managed IL Properties Other Properties Consolidated Revenues Resident fees and services $ 82,951 $ — $ 82,951 $ 83,516 $ 1,305 $ 84,821 Rental revenue — 1,582 1,582 — 1,583 1,583 Less: Property operating expense 48,760 — 48,760 49,052 1,641 50,693 Segment NOI $ 34,191 $ 1,582 35,773 $ 34,464 $ 1,247 35,711 Interest expense 15,281 19,570 Depreciation and amortization 16,782 16,987 General and administrative expense 5,894 5,359 Acquisition, transaction and integration expense 19 174 Loss on extinguishment of debt — 335 Other expense 433 62 Total expenses 38,409 42,487 Loss on sale of real estate — (122) Loss before income taxes (2,636) (6,898) Income tax expense 22 37 Loss from continuing operations (2,658) (6,935) Discontinued operations: Loss from discontinued operations — (2,651) Discontinued operations, net — (2,651) Net loss $ (2,658) $ (9,586) Six Months Ended June 30, 2020 Six Months Ended June 30, 2019 Managed IL Properties Other Properties Consolidated Managed IL Properties Other Properties Consolidated Revenues Resident fees and services $ 167,958 $ — $ 167,958 $ 167,261 $ 3,309 $ 170,570 Rental revenue 3,165 3,165 3,165 3,165 Less: Property operating expense 99,825 — 99,825 99,772 3,860 103,632 Segment NOI $ 68,133 $ 3,165 71,298 $ 67,489 $ 2,614 70,103 Interest expense 32,500 39,420 Depreciation and amortization 34,318 33,981 General and administrative expense 11,740 10,337 Acquisition, transaction and integration expense 152 666 Loss on extinguishment of debt 5,884 335 Other expense 328 1,377 Total expenses 84,922 86,116 Loss on sale of real estate — (122) Loss before income taxes (13,624) (16,135) Income tax expense 82 73 Loss from continuing operations (13,706) (16,208) Discontinued Operations: Gain on sale of real estate 19,992 — Loss from discontinued operations (3,107) (4,571) Discontinued operations, net 16,885 (4,571) Net income (loss) $ 3,179 $ (20,779) Assets by reportable business segment are reconciled to total assets as follows: June 30, 2020 December 31, 2019 Amount Percentage Amount Percentage Managed IL Properties $ 1,722,970 92.6 % $ 1,748,787 79.7 % Other Properties 63,619 3.4 % 63,616 2.9 % All other assets (A) 75,145 4.0 % 382,306 17.4 % Total assets $ 1,861,734 100.0 % $ 2,194,709 100.0 % (A) Includes $363.5 million of assets classified as discontinued operations for the year ended December 31, 2019. The remaining balance primarily consists of corporate cash which is not directly attributable to our reportable business segments. The following table presents the percentage of total revenues by geographic location: As of and for the six months ended As of and for the six months ended Number of Communities % of Total Revenue Number of Communities % of Total Revenue Florida 9 9.0 % 9 9.3 % California 9 10.3 % 9 10.8 % Texas 9 8.0 % 9 8.0 % North Carolina 8 8.5 % 8 8.6 % Pennsylvania 5 5.7 % 5 5.5 % Oregon 8 7.0 % 8 7.3 % Other 55 51.5 % 55 50.5 % Total 103 100.0 % 103 100.0 % |
REAL ESTATE INVESTMENTS
REAL ESTATE INVESTMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Real Estate [Abstract] | |
REAL ESTATE INVESTMENTS | REAL ESTATE INVESTMENTS The following table summarizes our real estate investments: June 30, 2020 December 31, 2019 Gross Carrying Amount Accumulated Depreciation Net Carrying Value Gross Carrying Amount Accumulated Depreciation Net Carrying Value Land $ 134,643 $ — $ 134,643 $ 134,643 $ — $ 134,643 Building and improvements 1,867,528 (293,648) 1,573,880 1,863,866 (266,420) 1,597,446 Furniture, fixtures and equipment 106,171 (92,019) 14,152 106,170 (85,135) 21,035 Total real estate investments $ 2,108,342 $ (385,667) $ 1,722,675 $ 2,104,679 $ (351,555) $ 1,753,124 Depreciation expense was $16.7 million and $16.9 million for the three months ended June 30, 2020 and 2019, respectively, and $34.1 million and $33.8 million for the six months ended June 30, 2020 and 2019, respectively. The following table summarizes our real estate intangibles: June 30, 2020 December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Amortization Period Intangible lease assets $ 7,642 $ (2,416) $ 5,226 43.5 years $ 7,642 $ (2,238) $ 5,404 43.0 years Amortization expense was $0.1 million for both the three months ended June 30, 2020 and 2019, and $0.2 million for both the six months ended June 30, 2020 and 2019. |
RECEIVABLES AND OTHER ASSETS, N
RECEIVABLES AND OTHER ASSETS, NET | 6 Months Ended |
Jun. 30, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
RECEIVABLES AND OTHER ASSETS, NET | RECEIVABLES AND OTHER ASSETS, NET June 30, 2020 December 31, 2019 Escrows held by lenders (A) $ 13,842 $ 15,895 Straight-line rent receivable 4,326 4,084 Prepaid expenses 3,354 3,534 Security deposits 2,932 2,763 Resident receivables, net 1,142 1,345 Income tax receivable 846 821 Other assets and receivables 5,066 4,636 Total receivables and other assets $ 31,508 $ 33,078 (A) Represents amounts held by lenders in tax, insurance, replacement reserve and other escrow accounts that are related to mortgage notes collateralized by our properties. Straight-line Rent Receivable Rental revenue from our triple net lease property is recognized on a straight-line basis over the applicable term of the lease when collectability of substantially all rents is probable. Recognizing rental revenue on a straight-line basis typically results in recognizing revenue in excess of cash amounts contractually due from our tenants during the first half of the lease term, creating a straight-line rent receivable. We assess the collectability of straight-line rent receivables on an ongoing basis. This assessment is based on several qualitative and quantitative factors, including and as appropriate, the payment history of the triple net lease tenant, the tenant’s ability to satisfy its lease obligations, the value of the underlying collateral or deposit, if any, and current economic conditions. If our evaluation of these factors indicates it is not probable that we will collect substantially all rents, any lease income is limited to the lesser of the lease income reflected on a straight-line basis or cash collected. The following table sets forth future contracted minimum lease payments from the tenant within the Other Properties segment, excluding contingent payment escalations, as of June 30, 2020: 2020 (six months) $ 2,979 2021 6,066 2022 6,233 2023 6,405 2024 6,581 Thereafter 38,888 Total future minimum lease payments $ 67,152 |
DEBT, NET
DEBT, NET | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT, NET | DEBT, NET June 30, 2020 December 31, 2019 Outstanding Face Amount Carrying Value (A) Maturity Date Stated Interest Rate Weighted Average Maturity (Years) Outstanding Face Amount Carrying Value (A) Floating Rate (B)(C)(D) $ 1,099,645 $ 1,084,036 Mar 2022- Mar 2030 1M LIBOR + 2.00% to 1M LIBOR + 2.75% 6.1 $ 1,139,036 $ 1,128,100 Fixed Rate 464,680 462,728 Sep 2025 4.25% 5.0 464,680 462,532 Total $ 1,564,325 $ 1,546,764 5.8 $ 1,603,716 $ 1,590,632 (A) The totals are reported net of deferred financing costs of $17.6 million and $13.1 million as of June 30, 2020 and December 31, 2019, respectively. (B) Substantially all of these loans have LIBOR caps that range between 3.38% and 3.75% as of June 30, 2020. (C) Includes $60.0 million of borrowings outstanding under the Revolver (defined below) as of June 30, 2020. (D) As of June 30, 2020, $350.0 million of total floating rate debt has been hedged using an interest rate swap, which is carried at fair value. See “Note 9 - Derivative Instruments” for more information. The carrying value of the collateral relating to the floating rate and fixed rate debt was $1.2 billion and $0.5 billion, respectively, as of both June 30, 2020, and December 31, 2019. Our debt agreements contain various customary financial and other covenants, in some cases including a debt service coverage ratio and project yield, as defined in the agreements. We are in compliance with the covenants in our debt agreements as of June 30, 2020. In February 2020, in conjunction with the AL/MC Portfolio Disposition, we obtained mortgage financing in the aggregate amount of $270.0 million from KeyBank and assigned to Federal Home Loan Mortgage Corporation (the “2020 Freddie Financing”). The 2020 Freddie Financing is secured by 14 of our managed IL properties, matures on March 1, 2030, and bears interest at an adjustable rate, adjusted monthly, equal to the sum of the one month LIBOR index rate plus 2.12%. Concurrently on the same date, we used the funds from the 2020 Freddie Financing and proceeds from the AL/MC Portfolio Disposition to prepay an aggregate of $368.1 million of secured loans. We recognized a loss on extinguishment of debt of $5.9 million, comprising of $4.5 million in prepayment penalties and $1.4 million in the write-off of unamortized deferred financing costs, and is recorded in “Loss on extinguishment of debt” on our Consolidated Statements of Operations. We incurred a total of $3.3 million in deferred financing costs, which have been capitalized and are being amortized over the life of the loan and the related amortization is included in “Interest expense” in our Consolidated Statements of Operations. In addition, in February 2020, we also amended and restated our secured revolving credit facility in the amount of $125.0 million (the “Revolver”) and extended its maturity from December 2021 to February 9, 2024. The amendment allows the Revolver to be increased with lender consent to a maximum aggregate amount of $500.0 million, of which (i) up to 10% may be used for the issuance of letters of credit, and (ii) up to 10% may be drawn by us in the form of swing loans. The Revolver bears an interest rate of, at our option, (i) the sum of LIBOR plus 2.0% or, in the case of a swing line loan, (ii) the greater of (a) the fluctuating annual rate of interest announced from time to time by KeyBank as its “prime rate,” plus 1.0% (b) 1.5% above the effective federal funds rate and (c) the sum of LIBOR for a one-month interest period plus 2.0%. The Revolver is secured by nine of our managed IL properties and the pledge of the equity interests of certain of our wholly owned subsidiaries. We continue to pay a fee for unused amounts of the Revolver under certain circumstances, which was not material for the three months ended June 30, 2020 and $0.1 million for the six months ended June 30, 2020, which was recorded in “Interest expense” in our Consolidated Statements of Operations. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements. Derivatives Designated as Hedging Instruments Interest rate swap In May 2019, we entered into a $350.0 million notional interest rate swap with a maturity of May 2022 that effectively converts LIBOR-based floating rate debt to fixed rate debt, thus reducing the impact of interest-rate changes on future interest expense. The interest rate swap was designated and qualified as a cash flow hedge with the change in fair value included in the assessment of hedge effectiveness deferred as a component of other comprehensive income (“OCI”), and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. As of June 30, 2020 and December 31, 2019, our interest rate swap liability of $14.3 million and $5.9 million, respectively, was recorded in “Accrued expenses and other liabilities” in our Consolidated Balance Sheets. For the three and six months ended June 30, 2020, $1.5 million and $2.0 million of loss was reclassified from accumulated other comprehensive income (loss) into earnings and was recorded in “Interest expense” in our Consolidated Statements of Operations, respectively. As of June 30, 2020, approximately $7.0 million of our interest rate swap liability, which is included in accumulated other comprehensive income (loss), is expected to be reclassified into earnings in the next 12 months. Derivatives Not Designated as Hedging Instruments Interest rate caps |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 6 Months Ended |
Jun. 30, 2020 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES AND OTHER LIABILITIES | ACCRUED EXPENSES AND OTHER LIABILITIES June 30, 2020 December 31, 2019 Accounts payable $ 9,978 $ 17,554 Security deposits payable 2,384 2,486 Due to property managers 6,640 6,752 Mortgage interest payable 3,822 5,665 Deferred community fees, net 5,449 5,865 Rent collected in advance 1,595 2,099 Property tax payable 5,825 5,627 Operating lease liability 2,010 1,942 Derivative liability 14,289 5,896 Other liabilities 5,831 5,434 Total accrued expenses and other liabilities $ 57,823 $ 59,320 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The carrying amounts and fair values of our financial instruments were as follows: Fair Value Hierarchy June 30, 2020 December 31, 2019 Carrying Value Fair Value Carrying Value Fair Value Financial Assets: Cash and cash equivalents (A) 1 $ 102,325 $ 102,325 $ 39,614 $ 39,614 Restricted cash (A) 1 16,774 16,774 18,658 18,658 Interest rate caps (B)(D) 2 51 51 IMM IMM Financial Liabilities: Mortgage debt (C) 3 $ 1,490,536 $ 1,536,901 $ 1,590,632 $ 1,592,855 Revolving credit facility (C) 3 56,228 59,403 — — Interest rate swap (B) 2 14,289 14,289 5,736 5,736 (A) The carrying amount approximates fair value. (B) Fair value based on pricing models that consider inputs including forward yield curves, cap strike rates, cap volatility and discount rates. (C) Fair value based on a discounted cash flow valuation model. Significant inputs in the model include amounts and timing of expected future cash flows and market yields which are constructed based on inputs implied from similar debt offerings. Our mortgage debt and revolving credit facility are not measured at fair value in our Consolidated Balance Sheets. (D) As of December 31, 2019, the carrying value and the fair value of our interest rate caps were immaterial. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES New Senior is organized and conducts its operations to qualify as a REIT under the requirements of the Internal Revenue Code of 1986, as amended (the “Code”). However, certain of our activities are conducted through our taxable REIT subsidiary (“TRS”) and therefore are subject to federal and state income taxes at regular corporate tax rates. The following table presents the provision (benefit) for income taxes (excluding discontinued operations): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Current Federal $ — $ — $ — $ — State and local 22 37 82 73 Total current provision 22 37 82 73 Deferred Federal — — — — State and local — — — — Total deferred provision — — — — Total provision for income taxes $ 22 $ 37 $ 82 $ 73 In assessing the recoverability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income by the TRS during the periods in which temporary differences become deductible before the net operating loss carryforward expires. Management believes that it is more likely than not that our net deferred tax assets will not be realized. As a result, we recorded valuation allowances against our deferred tax asset of $7.7 million and $7.9 million as of June 30, 2020 and December 31, 2019, respectively. However, the amount of the deferred tax asset considered realizable could be adjusted if (i) estimates of future taxable income during the carryforward period are reduced or increased or (ii) objective negative evidence in the form of cumulative losses is no longer present. |
REDEEMABLE PREFERRED STOCK, EQU
REDEEMABLE PREFERRED STOCK, EQUITY AND EARNINGS PER COMMON SHARE | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
REDEEMABLE PREFERRED STOCK, EQUITY AND EARNINGS PER COMMON SHARE | REDEEMABLE PREFERRED STOCK, EQUITY AND EARNINGS PER COMMON SHARE Redeemable Preferred Stock On December 31, 2018, we issued 400,000 shares of our Series A Redeemable Preferred Stock to the private equity firm that formerly externally managed us (the “Former Manager”). The Redeemable Preferred Stock are non-voting and have a $100 liquidation preference. Holders of the Redeemable Preferred Stock are entitled to cumulative cash dividends at a rate per annum of 6.00% on the liquidation preference amount plus all accumulated and unpaid dividends. The Redeemable Preferred Stock is subject to certain terms and conditions. We may redeem, at any time, all but not less than all of the shares of Redeemable Preferred Stock for cash at a price equal to the liquidation preference amount of the Redeemable Preferred Stock plus all accumulated and unpaid dividends thereon (the “Redemption Price”). On or after December 31, 2020, the holders of a majority of the then outstanding shares of Redeemable Preferred Stock will have the right to require us to redeem up to 50% of the outstanding shares of Redeemable Preferred Stock, and on or after December 31, 2021, the holders of a majority of the then outstanding shares of Redeemable Preferred Stock will have the right to require us to redeem all or any portion of the outstanding shares of Redeemable Preferred Stock, in each case, for cash at the Redemption Price. Due to the ability of the holders to require us to redeem the outstanding shares, the Redeemable Preferred Stock is excluded from Equity and reflected in our Consolidated Balance Sheets at its initial fair value of $40.0 million. The carrying value of the Redeemable Preferred Stock is increased by the accumulated and unpaid dividends in the period with a corresponding increase in accumulated deficit. Accrued dividends are treated as deductions in the calculation of net income (loss) applicable to common stockholders. The following table is a rollforward of our Redeemable Preferred Stock for the six months ended June 30, 2020: Balance as of December 31, 2019 $ 40,506 Accrued dividend on Redeemable Preferred Stock 1,197 Paid dividend on Redeemable Preferred Stock (1,203) Balance as of June 30, 2020 $ 40,500 Amended and Restated Stock Option and Incentive Award Plan On January 1, 2019, our board of directors adopted an Amended and Restated Nonqualified Stock Option and Incentive Award Plan (the “Plan”) providing for the grant of equity-based awards, including restricted stock awards (RSAs), restricted stock units (RSUs), stock options, stock appreciation rights, performance awards and other equity-based and non-equity based awards, in each case to our directors, officers, employees, service providers, consultants and advisors. We have reserved 27,922,570 shares of our common stock for issuance under the Plan. Vesting periods for these awards generally range from one Equity and Dividends In January 2020, strike prices for outstanding options as of December 31, 2019 were reduced by $0.52 (the “2019 ROC Adjustment”), reflecting the portion of our 2019 dividends which were deemed return of capital pursuant to the terms of the Plan. In addition, 20,098 additional options were issued to the Former Manager, in order to maintain the intrinsic value of an option grant with a strike price below the 2019 ROC Adjustment. Earnings per Common Share Basic EPS is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding. Diluted EPS is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding plus the additional dilutive effect, if any, of common stock equivalents during each period. Our common stock equivalents are our outstanding stock options and equity-based compensation awards. We have certain equity-based compensation awards that contain non-forfeitable rights to dividends, which are considered participating securities for the purposes of computing EPS pursuant to the two-class method, and therefore we apply the two-class method in our computation of EPS. The two-class method is an earnings allocation methodology that determines EPS for common shares and participating securities according to dividends declared or accumulated and participating rights in undistributed earnings. During periods of loss, there is no allocation required under the two-class method since the participating securities do not have a contractual obligation to fund losses. For the three and six months ended June 30, 2020 and 2019, basic and diluted net income (loss) per share was computed by dividing net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding during the period. The following table sets forth the computation of basic and diluted income (loss) per share of common stock for the three and six months ended June 30, 2020 and 2019: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Numerator Income (Loss) from continuing operations attributable to common stockholders $ (3,257) $ (7,534) $ (14,903) $ (17,405) Discontinued operations, net — (2,651) 16,885 (4,571) Net income (loss) attributable to common stockholders (3,257) (10,185) 1,982 (21,976) Less: Non-forfeitable dividends allocated to participating RSUs (28) — (59) — Net income (loss) available to common shares outstanding $ (3,285) $ (10,185) $ 1,923 $ (21,976) Denominator Basic weighted average common shares outstanding (A) 82,459,741 82,209,844 82,423,182 82,206,475 Dilutive common shares - equity awards and options (B) — — — — Diluted weighted average common shares outstanding 82,459,741 82,209,844 82,423,182 82,206,475 Basic earnings per common share: Loss from continuing operations attributable to common stockholders $ (0.04) $ (0.09) $ (0.18) $ (0.21) Discontinued operations, net — (0.03) 0.20 (0.06) Net income (loss) attributable to common stockholders $ (0.04) $ (0.12) $ 0.02 $ (0.27) Diluted earnings per common share: Loss from continuing operations attributable to common stockholders $ (0.04) $ (0.09) $ (0.18) $ (0.21) Discontinued operations, net — (0.03) 0.20 (0.06) Net income (loss) attributable to common stockholders $ (0.04) $ (0.12) $ 0.02 $ (0.27) (A) The outstanding shares used to calculate the weighted average basic shares outstanding exclude 454,921 and 916,415 restricted stock awards as of June 30, 2020 and 2019 net of forfeitures, respectively, as those shares were issued but were not vested and therefore, not considered outstanding for purposes of computing basic income (loss) per common share for the three and six months ended June 30, 2020. (B) During the three months ended June 30, 2020 and 2019, 292,483 and 1,694,244 dilutive share equivalents and options, respectively, were excluded as their inclusion would have been anti-dilutive given our loss position. During the six months ended June 30, 2020 and 2019, 947,465 and 1,335,826 dilutive share equivalents and options, respectively, were also excluded as their inclusion would have been anti-dilutive given our loss position. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES As of June 30, 2020, management believes there are no material contingencies that would affect our results of operations, cash flows or financial position. Certain Obligations, Liabilities and Litigation We are and may become subject to various obligations, liabilities, investigations, inquiries, regulatory proceedings, litigation and claims assumed in connection with or arising from our on-going business (some of which may not be fully insured and some of which may allege large damage amounts), as well as acquisitions, sales, leasing and other activities. These claims may include, among other things, professional liability and general liability claims, unfair business practices claims, employment claims and regulatory proceedings. The risks of some of these types of claims has increased as a result of the ongoing COVID-19 pandemic. These obligations and liabilities (including the costs associated with investigations, inquiries and litigation) may be greater than expected or may not be known in advance. Any such obligations or liabilities could have a material adverse effect on our financial position, cash flows and results of operations, particularly if we are not entitled to indemnification, or if a responsible third party fails to indemnify us. Certain Tax-Related Covenants If we are treated as a successor to Drive Shack under applicable U.S. federal income tax rules, and if Drive Shack failed to qualify as a REIT for a taxable year ending on or before December 31, 2015, we could be prohibited from electing to be a REIT. Accordingly, in the separation and distribution agreement entered into to effect our spin-off from Drive Shack (“Separation and Distribution Agreement”), Drive Shack (i) represented that it had no knowledge of any fact or circumstance that would cause us to fail to qualify as a REIT, (ii) covenanted to use commercially reasonable efforts to cooperate with New Senior as necessary to enable us to qualify for taxation as a REIT and receive customary legal opinions concerning REIT status, including providing information and representations to us and our tax counsel with respect to the composition of Drive Shack’s income and assets, the composition of its stockholders and its operation as a REIT, and (iii) covenanted to use its reasonable best efforts to maintain its REIT status for each of Drive Shack’s taxable years ending on or before December 31, 2015 (unless Drive Shack obtains an opinion from a nationally recognized tax counsel or a private letter ruling from the Internal Revenue Service (“IRS”) to the effect that Drive Shack’s failure to maintain its REIT status will not cause us to fail to qualify as a REIT under the successor REIT rule referred to above). Proceedings Indemnified and Defended by Third Parties From time to time, we are party to certain legal actions, regulatory investigations and claims for which third parties are contractually obligated to indemnify, defend and hold us harmless. While we are presently not being defended by any tenant and other obligated third parties in these types of matters, there is no assurance that our tenants, their affiliates or other obligated third parties would defend us in these matters, or that such parties will have sufficient assets, income and access to financing to enable them to satisfy their defense and indemnification obligations to us. Environmental Costs As a commercial real estate owner, we are subject to potential environmental costs. As of June 30, 2020, management is not aware of any environmental concerns that would have a material adverse effect on our financial position or results of operations. Capital Improvement and Repair Commitments We have agreed to make $1.0 million available for capital improvements during the 15 year lease period, which ends in 2030, to the triple net lease property under Watermark, none of which has been funded as of June 30, 2020. Upon funding these capital improvements, we will be entitled to a rent increase. Leases As the lessee, we currently lease our corporate office space located in New York, New York under an operating lease agreement. The lease requires fixed monthly rent payments, expires on June 30, 2024 and does not have any renewal option. We also currently lease equipment (e.g., dishwashers, copy machines and buses) used at certain of our managed IL Properties under operating lease agreements. Our leases have remaining lease terms ranging from one month to 4.0 years. We do not include any renewal options in our lease terms for calculating our lease liability because as of June 30, 2020, we were not reasonably certain if we will exercise these renewal options at this time. As of June 30, 2020, our future minimum lease payments under our operating leases are as follows: Year Operating Leases 2020 (six months) $ 255 2021 645 2022 508 2023 466 2024 235 Thereafter 310 Total future minimum lease payments 2,419 Less imputed interest (409) Total operating lease liability $ 2,010 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSOn August 3, 2020, our board of directors declared a cash dividend on our common stock of $0.065 per share for the quarter ended June 30, 2020. The dividend is payable on September 18, 2020 to stockholders of record on September 4, 2020. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP’’) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for financial statements. The consolidated financial statements include the accounts of New Senior and its consolidated subsidiaries. All significant intercompany transactions and balances have been eliminated. We consolidate those entities in which we have control over significant operating, financial and investing decisions of the entity. In the opinion of |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP’’) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for financial statements. The consolidated financial statements include the accounts of New Senior and its consolidated subsidiaries. All significant intercompany transactions and balances have been eliminated. We consolidate those entities in which we have control over significant operating, financial and investing decisions of the entity. In the opinion of |
Reclassifications | Certain prior period amounts have been reclassified to conform to the current period’s presentation, primarily related to the classification of certain properties as discontinued operations. |
Earnings per Common Share | Earnings per Common Share The two-class method determines EPS for each class of common stock and participating securities according to dividends declared (or accumulated) and their respective participation rights in undistributed earnings. Non-vested share-based payment awards that contain non-forfeitable rights to dividends are participating securities and, therefore are included in the computation of basic EPS pursuant to the two-class method. During the six months ended June 30, 2020, we issued 435,316 unvested restricted stock units to officers, employees and non-employee directors with certain participating rights (“Participating RSUs”). Diluted earnings per share of common stock is calculated by including the effect of dilutive securities. Participating RSUs are included in the computation of diluted EPS by using the more dilutive of the two-class method or treasury stock method. Any anti-dilutive securities are excluded from the calculation. During periods of loss, there is no allocation required under the two-class method since the participating securities do not have a contractual obligation to fund losses. Refer to our significant accounting policies disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019 for other significant accounting policies. |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements On January 1, 2020, we adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). This standard requires a company to recognize an impairment allowance equal to its current estimate of all contractual cash flows that it does not expect to collect from financial assets measured at amortized cost. The adoption of this standard did not have a material impact on our consolidated financial statements as our entire balance of receivables relates to lease agreements with our residents and tenant, which are specifically excluded from this standard. Recently Issued Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). This ASU provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference London Inter-Bank Rate (“LIBOR”) or another rate that is expected to be discontinued. Companies can adopt ASU 2020-04 anytime during the effective period of March 12, 2020 through December 31, 2022. We are currently assessing the provisions of ASU 2020-04 and have not made any hedge accounting elections as of June 30, 2020. If an election is made at a later date, we will apply the provisions of this guidance. |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Discontinued Operations | As of December 31, 2019, the assets and liabilities associated with discontinued operations were as follows: December 31, 2019 Assets Real estate investments: Land $ 43,313 Buildings, improvements and other 397,808 Accumulated depreciation (87,719) Net real estate property 353,402 Acquired lease and other intangible assets 996 Accumulated amortization (996) Net real estate intangibles — Net real estate investments 353,402 Receivables and other assets, net 10,087 Assets from discontinued operations $ 363,489 Liabilities Debt, net $ 255,096 Accrued expenses and other liabilities 12,760 Liabilities from discontinued operations $ 267,856 For the three and six months ended June 30, 2020 and 2019, the results of operations associated with discontinued operations are as follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Revenues Resident fees and services $ — $ 29,616 $ 14,024 $ 59,904 Total revenues — 29,616 14,024 59,904 Expenses Property operating expenses — 24,264 11,328 48,672 Interest expense — 3,913 1,361 7,782 Depreciation and amortization — 3,768 — 7,561 Acquisition, transaction, and integration expense — 237 1,037 395 General and administrative expense — 13 8 19 Loss on extinguishment of debt — — 3,602 — Other expense (income) — 45 (204) (25) Total expenses — 32,240 17,132 64,404 Loss before income taxes — (2,624) (3,108) (4,500) Income tax (benefit) expense — 27 (1) 71 Loss from discontinued operations $ — $ (2,651) $ (3,107) $ (4,571) |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting | Three Months Ended June 30, 2020 Three Months Ended June 30, 2019 Managed IL Properties Other Properties Consolidated Managed IL Properties Other Properties Consolidated Revenues Resident fees and services $ 82,951 $ — $ 82,951 $ 83,516 $ 1,305 $ 84,821 Rental revenue — 1,582 1,582 — 1,583 1,583 Less: Property operating expense 48,760 — 48,760 49,052 1,641 50,693 Segment NOI $ 34,191 $ 1,582 35,773 $ 34,464 $ 1,247 35,711 Interest expense 15,281 19,570 Depreciation and amortization 16,782 16,987 General and administrative expense 5,894 5,359 Acquisition, transaction and integration expense 19 174 Loss on extinguishment of debt — 335 Other expense 433 62 Total expenses 38,409 42,487 Loss on sale of real estate — (122) Loss before income taxes (2,636) (6,898) Income tax expense 22 37 Loss from continuing operations (2,658) (6,935) Discontinued operations: Loss from discontinued operations — (2,651) Discontinued operations, net — (2,651) Net loss $ (2,658) $ (9,586) Six Months Ended June 30, 2020 Six Months Ended June 30, 2019 Managed IL Properties Other Properties Consolidated Managed IL Properties Other Properties Consolidated Revenues Resident fees and services $ 167,958 $ — $ 167,958 $ 167,261 $ 3,309 $ 170,570 Rental revenue 3,165 3,165 3,165 3,165 Less: Property operating expense 99,825 — 99,825 99,772 3,860 103,632 Segment NOI $ 68,133 $ 3,165 71,298 $ 67,489 $ 2,614 70,103 Interest expense 32,500 39,420 Depreciation and amortization 34,318 33,981 General and administrative expense 11,740 10,337 Acquisition, transaction and integration expense 152 666 Loss on extinguishment of debt 5,884 335 Other expense 328 1,377 Total expenses 84,922 86,116 Loss on sale of real estate — (122) Loss before income taxes (13,624) (16,135) Income tax expense 82 73 Loss from continuing operations (13,706) (16,208) Discontinued Operations: Gain on sale of real estate 19,992 — Loss from discontinued operations (3,107) (4,571) Discontinued operations, net 16,885 (4,571) Net income (loss) $ 3,179 $ (20,779) Assets by reportable business segment are reconciled to total assets as follows: June 30, 2020 December 31, 2019 Amount Percentage Amount Percentage Managed IL Properties $ 1,722,970 92.6 % $ 1,748,787 79.7 % Other Properties 63,619 3.4 % 63,616 2.9 % All other assets (A) 75,145 4.0 % 382,306 17.4 % Total assets $ 1,861,734 100.0 % $ 2,194,709 100.0 % (A) Includes $363.5 million of assets classified as discontinued operations for the year ended December 31, 2019. The remaining balance primarily consists of corporate cash which is not directly attributable to our reportable business segments. |
Percentage of Total Revenues by Geographic Location | The following table presents the percentage of total revenues by geographic location: As of and for the six months ended As of and for the six months ended Number of Communities % of Total Revenue Number of Communities % of Total Revenue Florida 9 9.0 % 9 9.3 % California 9 10.3 % 9 10.8 % Texas 9 8.0 % 9 8.0 % North Carolina 8 8.5 % 8 8.6 % Pennsylvania 5 5.7 % 5 5.5 % Oregon 8 7.0 % 8 7.3 % Other 55 51.5 % 55 50.5 % Total 103 100.0 % 103 100.0 % |
REAL ESTATE INVESTMENTS (Tables
REAL ESTATE INVESTMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Real Estate [Abstract] | |
Real Estate Investments | The following table summarizes our real estate investments: June 30, 2020 December 31, 2019 Gross Carrying Amount Accumulated Depreciation Net Carrying Value Gross Carrying Amount Accumulated Depreciation Net Carrying Value Land $ 134,643 $ — $ 134,643 $ 134,643 $ — $ 134,643 Building and improvements 1,867,528 (293,648) 1,573,880 1,863,866 (266,420) 1,597,446 Furniture, fixtures and equipment 106,171 (92,019) 14,152 106,170 (85,135) 21,035 Total real estate investments $ 2,108,342 $ (385,667) $ 1,722,675 $ 2,104,679 $ (351,555) $ 1,753,124 |
Real Estate Intangibles | The following table summarizes our real estate intangibles: June 30, 2020 December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Amortization Period Intangible lease assets $ 7,642 $ (2,416) $ 5,226 43.5 years $ 7,642 $ (2,238) $ 5,404 43.0 years |
RECEIVABLES AND OTHER ASSETS,_2
RECEIVABLES AND OTHER ASSETS, NET (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Receivables and Other Assets, Net | June 30, 2020 December 31, 2019 Escrows held by lenders (A) $ 13,842 $ 15,895 Straight-line rent receivable 4,326 4,084 Prepaid expenses 3,354 3,534 Security deposits 2,932 2,763 Resident receivables, net 1,142 1,345 Income tax receivable 846 821 Other assets and receivables 5,066 4,636 Total receivables and other assets $ 31,508 $ 33,078 |
Schedule of Future Minimum Rental Payments for Operating Leases | The following table sets forth future contracted minimum lease payments from the tenant within the Other Properties segment, excluding contingent payment escalations, as of June 30, 2020: 2020 (six months) $ 2,979 2021 6,066 2022 6,233 2023 6,405 2024 6,581 Thereafter 38,888 Total future minimum lease payments $ 67,152 |
DEBT, NET (Tables)
DEBT, NET (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Mortgage Notes Payable, Net | June 30, 2020 December 31, 2019 Outstanding Face Amount Carrying Value (A) Maturity Date Stated Interest Rate Weighted Average Maturity (Years) Outstanding Face Amount Carrying Value (A) Floating Rate (B)(C)(D) $ 1,099,645 $ 1,084,036 Mar 2022- Mar 2030 1M LIBOR + 2.00% to 1M LIBOR + 2.75% 6.1 $ 1,139,036 $ 1,128,100 Fixed Rate 464,680 462,728 Sep 2025 4.25% 5.0 464,680 462,532 Total $ 1,564,325 $ 1,546,764 5.8 $ 1,603,716 $ 1,590,632 (A) The totals are reported net of deferred financing costs of $17.6 million and $13.1 million as of June 30, 2020 and December 31, 2019, respectively. (B) Substantially all of these loans have LIBOR caps that range between 3.38% and 3.75% as of June 30, 2020. (C) Includes $60.0 million of borrowings outstanding under the Revolver (defined below) as of June 30, 2020. (D) As of June 30, 2020, $350.0 million of total floating rate debt has been hedged using an interest rate swap, which is carried at fair value. See “Note 9 - Derivative Instruments” for more information. |
ACCRUED EXPENSES AND OTHER LI_2
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Liabilities | June 30, 2020 December 31, 2019 Accounts payable $ 9,978 $ 17,554 Security deposits payable 2,384 2,486 Due to property managers 6,640 6,752 Mortgage interest payable 3,822 5,665 Deferred community fees, net 5,449 5,865 Rent collected in advance 1,595 2,099 Property tax payable 5,825 5,627 Operating lease liability 2,010 1,942 Derivative liability 14,289 5,896 Other liabilities 5,831 5,434 Total accrued expenses and other liabilities $ 57,823 $ 59,320 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Carrying Amounts and Fair Values of Financial Instruments | The carrying amounts and fair values of our financial instruments were as follows: Fair Value Hierarchy June 30, 2020 December 31, 2019 Carrying Value Fair Value Carrying Value Fair Value Financial Assets: Cash and cash equivalents (A) 1 $ 102,325 $ 102,325 $ 39,614 $ 39,614 Restricted cash (A) 1 16,774 16,774 18,658 18,658 Interest rate caps (B)(D) 2 51 51 IMM IMM Financial Liabilities: Mortgage debt (C) 3 $ 1,490,536 $ 1,536,901 $ 1,590,632 $ 1,592,855 Revolving credit facility (C) 3 56,228 59,403 — — Interest rate swap (B) 2 14,289 14,289 5,736 5,736 (A) The carrying amount approximates fair value. (B) Fair value based on pricing models that consider inputs including forward yield curves, cap strike rates, cap volatility and discount rates. (C) Fair value based on a discounted cash flow valuation model. Significant inputs in the model include amounts and timing of expected future cash flows and market yields which are constructed based on inputs implied from similar debt offerings. Our mortgage debt and revolving credit facility are not measured at fair value in our Consolidated Balance Sheets. (D) As of December 31, 2019, the carrying value and the fair value of our interest rate caps were immaterial. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | The following table presents the provision (benefit) for income taxes (excluding discontinued operations): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Current Federal $ — $ — $ — $ — State and local 22 37 82 73 Total current provision 22 37 82 73 Deferred Federal — — — — State and local — — — — Total deferred provision — — — — Total provision for income taxes $ 22 $ 37 $ 82 $ 73 |
REDEEMABLE PREFERRED STOCK, E_2
REDEEMABLE PREFERRED STOCK, EQUITY AND EARNINGS PER COMMON SHARE (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Rollforward of Redeemable Preferred Stock | The following table is a rollforward of our Redeemable Preferred Stock for the six months ended June 30, 2020: Balance as of December 31, 2019 $ 40,506 Accrued dividend on Redeemable Preferred Stock 1,197 Paid dividend on Redeemable Preferred Stock (1,203) Balance as of June 30, 2020 $ 40,500 |
Computation of Basic and Diluted Loss Per Share | The following table sets forth the computation of basic and diluted income (loss) per share of common stock for the three and six months ended June 30, 2020 and 2019: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Numerator Income (Loss) from continuing operations attributable to common stockholders $ (3,257) $ (7,534) $ (14,903) $ (17,405) Discontinued operations, net — (2,651) 16,885 (4,571) Net income (loss) attributable to common stockholders (3,257) (10,185) 1,982 (21,976) Less: Non-forfeitable dividends allocated to participating RSUs (28) — (59) — Net income (loss) available to common shares outstanding $ (3,285) $ (10,185) $ 1,923 $ (21,976) Denominator Basic weighted average common shares outstanding (A) 82,459,741 82,209,844 82,423,182 82,206,475 Dilutive common shares - equity awards and options (B) — — — — Diluted weighted average common shares outstanding 82,459,741 82,209,844 82,423,182 82,206,475 Basic earnings per common share: Loss from continuing operations attributable to common stockholders $ (0.04) $ (0.09) $ (0.18) $ (0.21) Discontinued operations, net — (0.03) 0.20 (0.06) Net income (loss) attributable to common stockholders $ (0.04) $ (0.12) $ 0.02 $ (0.27) Diluted earnings per common share: Loss from continuing operations attributable to common stockholders $ (0.04) $ (0.09) $ (0.18) $ (0.21) Discontinued operations, net — (0.03) 0.20 (0.06) Net income (loss) attributable to common stockholders $ (0.04) $ (0.12) $ 0.02 $ (0.27) (A) The outstanding shares used to calculate the weighted average basic shares outstanding exclude 454,921 and 916,415 restricted stock awards as of June 30, 2020 and 2019 net of forfeitures, respectively, as those shares were issued but were not vested and therefore, not considered outstanding for purposes of computing basic income (loss) per common share for the three and six months ended June 30, 2020. (B) During the three months ended June 30, 2020 and 2019, 292,483 and 1,694,244 dilutive share equivalents and options, respectively, were excluded as their inclusion would have been anti-dilutive given our loss position. During the six months ended June 30, 2020 and 2019, 947,465 and 1,335,826 dilutive share equivalents and options, respectively, were also excluded as their inclusion would have been anti-dilutive given our loss position. |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments | As of June 30, 2020, our future minimum lease payments under our operating leases are as follows: Year Operating Leases 2020 (six months) $ 255 2021 645 2022 508 2023 466 2024 235 Thereafter 310 Total future minimum lease payments 2,419 Less imputed interest (409) Total operating lease liability $ 2,010 |
ORGANIZATION - Narrative (Detai
ORGANIZATION - Narrative (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020USD ($)stateProperty | Jun. 30, 2020USD ($)Propertysegmentstate | |
Real Estate Properties [Line Items] | ||
Number of real estate properties | 103 | 103 |
Number of states in which properties are located | state | 36 | 36 |
Number of reportable segments | segment | 2 | |
COVID-19 related costs | $ | $ 1.4 | $ 1.9 |
Managed IL Properties | ||
Real Estate Properties [Line Items] | ||
Number of real estate properties | 102 | 102 |
Extension period after initial term of property management agreements | 1 year | |
Managed IL Properties | Minimum | ||
Real Estate Properties [Line Items] | ||
Initial term of property management agreements | 5 years | |
Percentage of property's effective gross revenues paid as property management fees | 4.50% | |
Managed IL Properties | Maximum | ||
Real Estate Properties [Line Items] | ||
Initial term of property management agreements | 10 years | |
Percentage of property's effective gross revenues paid as property management fees | 5.00% | |
Other Properties | ||
Real Estate Properties [Line Items] | ||
Number of real estate properties | 1 | 1 |
Other Properties | Minimum | ||
Real Estate Properties [Line Items] | ||
Term of lease agreements | 15 years | 15 years |
Rent increase percentage in lease agreements | 2.75% | |
Other Properties | Maximum | ||
Real Estate Properties [Line Items] | ||
Rent increase percentage in lease agreements | 3.25% |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - shares | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Restricted stock awards issued (in shares) | 454,921 | 916,415 |
Officers, Employees, And Non-Employee Directors | Restricted Stock Units (RSUs) | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Restricted stock awards issued (in shares) | 435,316 |
DISCONTINUED OPERATIONS - Narra
DISCONTINUED OPERATIONS - Narrative (Details) - Assisted Living and Memory Care Properties $ in Millions | Feb. 10, 2020USD ($)Property | Jun. 30, 2019USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Sale price | $ 13.8 | |
Discontinued Operations | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Number of senior housing properties sold (property) | Property | 28 | |
Sale price | $ 385 |
DISCONTINUED OPERATIONS - Sched
DISCONTINUED OPERATIONS - Schedule of Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Real estate investments: | ||
Assets from discontinued operations | $ 0 | $ 363,489 |
Liabilities | ||
Liabilities from discontinued operations | $ 0 | 267,856 |
Discontinued Operations | ||
Real estate investments: | ||
Land | 43,313 | |
Buildings, improvements and other | 397,808 | |
Accumulated depreciation | (87,719) | |
Net real estate property | 353,402 | |
Acquired lease and other intangible assets | 996 | |
Accumulated amortization | (996) | |
Net real estate intangibles | 0 | |
Net real estate investments | 353,402 | |
Receivables and other assets, net | 10,087 | |
Assets from discontinued operations | 363,489 | |
Liabilities | ||
Debt, net | 255,096 | |
Accrued expenses and other liabilities | 12,760 | |
Liabilities from discontinued operations | $ 267,856 |
DISCONTINUED OPERATIONS - Summa
DISCONTINUED OPERATIONS - Summary of the Loss from Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Expenses | ||||
Discontinued operations, net | $ 0 | $ (2,651) | $ 16,885 | $ (4,571) |
Discontinued Operations | ||||
Revenues | ||||
Resident fees and services | 0 | 29,616 | 14,024 | 59,904 |
Total revenues | 0 | 29,616 | 14,024 | 59,904 |
Expenses | ||||
Property operating expenses | 0 | 24,264 | 11,328 | 48,672 |
Interest expense | 0 | 3,913 | 1,361 | 7,782 |
Depreciation and amortization | 0 | 3,768 | 0 | 7,561 |
Acquisition, transaction, and integration expense | 0 | 237 | 1,037 | 395 |
General and administrative expense | 0 | 13 | 8 | 19 |
Loss on extinguishment of debt | 0 | 0 | 3,602 | 0 |
Other expense (income) | 45 | |||
Other expense (income) | 0 | (204) | (25) | |
Total expenses | 0 | 32,240 | 17,132 | 64,404 |
Loss before income taxes | 0 | (2,624) | (3,108) | (4,500) |
Income tax (benefit) expense | 0 | 27 | (1) | 71 |
Discontinued operations, net | $ 0 | $ (2,651) | $ (3,107) | $ (4,571) |
DISPOSITIONS (Details)
DISPOSITIONS (Details) $ in Thousands | Feb. 10, 2020USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($)property | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Gain on sale of real estate | $ 20,000 | $ 19,992 | $ (122) | ||
Loss on extinguishment of debt | $ 0 | $ 335 | 5,884 | 335 | |
Prepayment penalties | 4,504 | 206 | |||
Loss on sale of real estate | $ 0 | 122 | 0 | 122 | |
Repayment of mortgage notes payable | $ 369,000 | 13,674 | |||
Assisted Living and Memory Care Properties | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Sale price | $ 13,800 | $ 13,800 | |||
Number of properties sold | property | 2 | ||||
Loss on sale of real estate | $ 100 | ||||
Repayment of mortgage notes payable | $ 13,700 | ||||
Discontinued Operations | Assisted Living and Memory Care Properties | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Sale price | 385,000 | ||||
Secured Debt | Term Loan | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Repayments of debt | 260,200 | ||||
Loss on extinguishment of debt | 3,600 | ||||
Prepayment penalties | 2,500 | ||||
Write off of deferred financing costs | $ 1,100 |
SEGMENT REPORTING - Narrative (
SEGMENT REPORTING - Narrative (Details) | 6 Months Ended |
Jun. 30, 2020Propertysegment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | segment | 2 |
Number of real estate properties | 103 |
Managed IL Properties | |
Segment Reporting Information [Line Items] | |
Number of real estate properties | 102 |
Independent Living Properties | Managed IL Properties | |
Segment Reporting Information [Line Items] | |
Number of real estate properties | 102 |
Independent Living Properties | Assisted Living and Memory Care Properties | |
Segment Reporting Information [Line Items] | |
Number of real estate properties | 2 |
SEGMENT REPORTING - Segment Inf
SEGMENT REPORTING - Segment Information (Details) - USD ($) $ in Thousands | Feb. 10, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 |
Revenues | |||||
Total revenues | $ 84,533 | $ 86,404 | $ 171,123 | $ 173,735 | |
Less: Property operating expense | 48,760 | 50,693 | 99,825 | 103,632 | |
Segment NOI | 35,773 | 35,711 | 71,298 | 70,103 | |
Interest expense | 15,281 | 19,570 | 32,500 | 39,420 | |
Depreciation and amortization | 16,782 | 16,987 | 34,318 | 33,981 | |
General and administrative expense | 5,894 | 5,359 | 11,740 | 10,337 | |
Acquisition, transaction and integration expense | 19 | 174 | 152 | 666 | |
Loss on extinguishment of debt | 0 | 335 | 5,884 | 335 | |
Other expense | 433 | 62 | 328 | 1,377 | |
Total expenses | 38,409 | 42,487 | 84,922 | 86,116 | |
Loss on sale of real estate | 0 | (122) | 0 | (122) | |
Loss before income taxes | (2,636) | (6,898) | (13,624) | (16,135) | |
Income tax expense | 22 | 37 | 82 | 73 | |
Loss from continuing operations | (2,658) | (6,935) | (13,706) | (16,208) | |
Gain on sale of real estate | $ 20,000 | 19,992 | (122) | ||
Loss from discontinued operations | 0 | (2,651) | (3,107) | (4,571) | |
Discontinued operations, net | 0 | (2,651) | 16,885 | (4,571) | |
Net income (loss) | (2,658) | (9,586) | 3,179 | (20,779) | |
Resident fees and services | |||||
Revenues | |||||
Total revenues | 82,951 | 84,821 | 167,958 | 170,570 | |
Rental revenue | |||||
Revenues | |||||
Total revenues | 1,582 | 1,583 | 3,165 | 3,165 | |
Operating Segments | Managed IL Properties | |||||
Revenues | |||||
Less: Property operating expense | 48,760 | 49,052 | 99,825 | 99,772 | |
Segment NOI | 34,191 | 34,464 | 68,133 | 67,489 | |
Operating Segments | Other Properties | |||||
Revenues | |||||
Less: Property operating expense | 0 | 1,641 | 0 | 3,860 | |
Segment NOI | 1,582 | 1,247 | 3,165 | 2,614 | |
Operating Segments | Resident fees and services | Managed IL Properties | |||||
Revenues | |||||
Total revenues | 82,951 | 83,516 | 167,958 | 167,261 | |
Operating Segments | Resident fees and services | Other Properties | |||||
Revenues | |||||
Total revenues | 0 | 1,305 | 0 | 3,309 | |
Operating Segments | Rental revenue | Managed IL Properties | |||||
Revenues | |||||
Total revenues | 0 | 0 | |||
Operating Segments | Rental revenue | Other Properties | |||||
Revenues | |||||
Total revenues | $ 1,582 | $ 1,583 | $ 3,165 | $ 3,165 |
SEGMENT REPORTING - Assets Repo
SEGMENT REPORTING - Assets Reportable Business Segment (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Segment Reporting Information [Line Items] | ||
Assets | $ 1,861,734 | $ 2,194,709 |
Percentage of assets | 100.00% | 100.00% |
Discontinued Operations | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 363,500 | |
Operating Segments | Managed IL Properties | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 1,722,970 | $ 1,748,787 |
Percentage of assets | 92.60% | 79.70% |
Operating Segments | Other Properties | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 63,619 | $ 63,616 |
Percentage of assets | 3.40% | 2.90% |
Corporate, Non-Segment | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 75,145 | $ 382,306 |
Percentage of assets | 4.00% | 17.40% |
SEGMENT REPORTING - Percentage
SEGMENT REPORTING - Percentage of Total Revenues by Geographic Location (Details) - Property | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting Information [Line Items] | ||
Number of communities | 103 | |
Revenue Benchmark | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 103 | 103 |
Percentage of revenue | 100.00% | 100.00% |
Revenue Benchmark | Florida | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 9 | 9 |
Percentage of revenue | 9.00% | 9.30% |
Revenue Benchmark | California | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 9 | 9 |
Percentage of revenue | 10.30% | 10.80% |
Revenue Benchmark | Texas | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 9 | 9 |
Percentage of revenue | 8.00% | 8.00% |
Revenue Benchmark | North Carolina | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 8 | 8 |
Percentage of revenue | 8.50% | 8.60% |
Revenue Benchmark | Pennsylvania | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 5 | 5 |
Percentage of revenue | 5.70% | 5.50% |
Revenue Benchmark | Oregon | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 8 | 8 |
Percentage of revenue | 7.00% | 7.30% |
Revenue Benchmark | Other | ||
Segment Reporting Information [Line Items] | ||
Number of communities | 55 | 55 |
Percentage of revenue | 51.50% | 50.50% |
REAL ESTATE INVESTMENTS, Real E
REAL ESTATE INVESTMENTS, Real Estate Assets and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Real Estate Investments, Net [Abstract] | |||||
Gross Carrying Amount | $ 2,108,342 | $ 2,108,342 | $ 2,104,679 | ||
Accumulated depreciation | (385,667) | (385,667) | (351,555) | ||
Net real estate property | 1,722,675 | 1,722,675 | 1,753,124 | ||
Depreciation expense | 16,700 | $ 16,900 | 34,100 | $ 33,800 | |
Real Estate Intangibles [Abstract] | |||||
Gross Carrying Amount | 7,642 | 7,642 | 7,642 | ||
Accumulated amortization | (2,416) | (2,416) | (2,238) | ||
Net real estate intangibles | 5,226 | 5,226 | 5,404 | ||
Amortization expense | 100 | $ 100 | 200 | $ 200 | |
Land | |||||
Real Estate Investments, Net [Abstract] | |||||
Gross Carrying Amount | 134,643 | 134,643 | 134,643 | ||
Accumulated depreciation | 0 | 0 | 0 | ||
Net real estate property | 134,643 | 134,643 | 134,643 | ||
Building and improvements | |||||
Real Estate Investments, Net [Abstract] | |||||
Gross Carrying Amount | 1,867,528 | 1,867,528 | 1,863,866 | ||
Accumulated depreciation | (293,648) | (293,648) | (266,420) | ||
Net real estate property | 1,573,880 | 1,573,880 | 1,597,446 | ||
Furniture, fixtures and equipment | |||||
Real Estate Investments, Net [Abstract] | |||||
Gross Carrying Amount | 106,171 | 106,171 | 106,170 | ||
Accumulated depreciation | (92,019) | (92,019) | (85,135) | ||
Net real estate property | 14,152 | 14,152 | 21,035 | ||
Intangible lease assets | |||||
Real Estate Intangibles [Abstract] | |||||
Gross Carrying Amount | 7,642 | 7,642 | 7,642 | ||
Accumulated amortization | (2,416) | (2,416) | (2,238) | ||
Net real estate intangibles | $ 5,226 | $ 5,226 | $ 5,404 | ||
Weighted Average Remaining Amortization Period | 43 years 6 months | 43 years |
RECEIVABLES AND OTHER ASSETS,_3
RECEIVABLES AND OTHER ASSETS, NET (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Escrows held by lenders | $ 13,842 | $ 15,895 |
Straight-line rent receivable | 4,326 | 4,084 |
Prepaid expenses | 3,354 | 3,534 |
Security deposits | 2,932 | 2,763 |
Resident receivables, net | 1,142 | 1,345 |
Income tax receivable | 846 | 821 |
Other assets and receivables | 5,066 | 4,636 |
Total receivables and other assets | $ 31,508 | $ 33,078 |
RECEIVABLES AND OTHER ASSETS,_4
RECEIVABLES AND OTHER ASSETS, NET - Future Minimum Lease Payments (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
2020 (six months) | $ 2,979 |
2021 | 6,066 |
2022 | 6,233 |
2023 | 6,405 |
2024 | 6,581 |
Thereafter | 38,888 |
Total future minimum lease payments | $ 67,152 |
DEBT, NET - Schedule of Debt, N
DEBT, NET - Schedule of Debt, Net (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Mortgage Notes Payable [Abstract] | ||
Outstanding Face Amount | $ 1,564,325,000 | $ 1,603,716,000 |
Carrying value | $ 1,546,764,000 | 1,590,632,000 |
Weighted average maturity (years) | 5 years 9 months 18 days | |
Line of credit facility, maximum amount outstanding during period | $ 60,000,000 | |
Floating Rate | LIBOR | Minimum | ||
Mortgage Notes Payable [Abstract] | ||
Basis spread on variable rate | 2.00% | |
Floating Rate | LIBOR | Maximum | ||
Mortgage Notes Payable [Abstract] | ||
Basis spread on variable rate | 2.75% | |
Mortgage debt | ||
Mortgage Notes Payable [Abstract] | ||
Deferred financing costs | $ 17,600,000 | 13,100,000 |
Managed Properties | Mortgage debt | LIBOR | Minimum | ||
Mortgage Notes Payable [Abstract] | ||
Basis spread on variable rate | 3.38% | |
Managed Properties | Mortgage debt | LIBOR | Maximum | ||
Mortgage Notes Payable [Abstract] | ||
Basis spread on variable rate | 3.75% | |
Managed Properties | Mortgage debt | Floating Rate | ||
Mortgage Notes Payable [Abstract] | ||
Outstanding Face Amount | $ 1,099,645,000 | 1,139,036,000 |
Carrying value | $ 1,084,036,000 | 1,128,100,000 |
Weighted average maturity (years) | 6 years 1 month 6 days | |
Managed Properties | Mortgage debt | Fixed Rate | ||
Mortgage Notes Payable [Abstract] | ||
Outstanding Face Amount | $ 464,680,000 | 464,680,000 |
Carrying value | $ 462,728,000 | $ 462,532,000 |
Stated Interest Rate | 4.25% | |
Weighted average maturity (years) | 5 years | |
Designated as Hedging Instrument | Interest Rate Swap | Mortgage debt | Floating Rate | ||
Mortgage Notes Payable [Abstract] | ||
Outstanding Face Amount | $ 350,000,000 |
DEBT, NET - Narrative (Details)
DEBT, NET - Narrative (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Feb. 29, 2020USD ($)Property | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
Debt Instrument [Line Items] | ||||||
Loss on extinguishment of debt | $ 0 | $ 335,000 | $ 5,884,000 | $ 335,000 | ||
Prepayment penalties | 4,504,000 | $ 206,000 | ||||
Unused borrowing capacity fee | 100,000 | |||||
2020 Freddie Financing | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | $ 270,000,000 | |||||
Repayments of debt | 368,100,000 | |||||
Mortgage debt | ||||||
Debt Instrument [Line Items] | ||||||
Deferred financing costs | 17,600,000 | 17,600,000 | $ 13,100,000 | |||
Mortgage debt | Floating Rate | ||||||
Debt Instrument [Line Items] | ||||||
Carrying value of collateral | 1,200,000,000 | 1,200,000,000 | 1,200,000,000 | |||
Mortgage debt | Fixed Rate | ||||||
Debt Instrument [Line Items] | ||||||
Carrying value of collateral | $ 500,000,000 | $ 500,000,000 | $ 500,000,000 | |||
Secured Debt | 2020 Freddie Financing | ||||||
Debt Instrument [Line Items] | ||||||
Loss on extinguishment of debt | 5,900,000 | |||||
Prepayment penalties | 4,500,000 | |||||
Write off of deferred financing costs | 1,400,000 | |||||
Deferred financing costs | $ 3,300,000 | |||||
Secured Debt | 2020 Freddie Financing | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.12% | |||||
Revolving Credit Facility | Amended and Restated Revolver | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | $ 125,000,000 | |||||
Line of credit facility, increase limit | $ 500,000,000 | |||||
Threshold percentage that may be used for the issuance of letters of credit | 10.00% | |||||
Threshold percentage that may be drawn as swing line loans | 10.00% | |||||
Revolving Credit Facility | Amended and Restated Revolver | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.00% | |||||
Revolving Credit Facility | Amended and Restated Revolver | Prime Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1.00% | |||||
Revolving Credit Facility | Amended and Restated Revolver | Fed Funds Effective Rate Overnight Index Swap Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1.50% | |||||
Independent Living Properties | 2020 Freddie Financing | ||||||
Debt Instrument [Line Items] | ||||||
Number of properties secured in debt agreement | Property | 14 |
DERIVATIVE INSTRUMENTS - Narrat
DERIVATIVE INSTRUMENTS - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | May 31, 2019 | |
Derivative [Line Items] | |||||
Derivative liability | $ 14,289,000 | $ 14,289,000 | $ 5,896,000 | ||
Interest rate cash flow hedge loss to be reclassified during the next twelve month | 7,000,000 | 7,000,000 | |||
Derivative, loss on derivative | $ 600,000 | ||||
Designated as Hedging Instrument | Interest Rate Swap | Interest Expense | |||||
Derivative [Line Items] | |||||
Cash flow hedge, loss reclassified from accumulated other comprehensive income (loss) into earnings | 1,500,000 | 2,000,000 | |||
Designated as Hedging Instrument | Cash Flow Hedging | Interest Rate Swap | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | $ 350,000,000 | ||||
Derivative liability | $ 14,300,000 | $ 14,300,000 | $ 5,900,000 |
ACCRUED EXPENSES AND OTHER LI_3
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 9,978 | $ 17,554 |
Security deposits payable | 2,384 | 2,486 |
Due to property managers | 6,640 | 6,752 |
Mortgage interest payable | 3,822 | 5,665 |
Deferred community fees, net | 5,449 | 5,865 |
Rent collected in advance | 1,595 | 2,099 |
Property tax payable | 5,825 | 5,627 |
Operating lease liability | 2,010 | 1,942 |
Derivative liability | 14,289 | 5,896 |
Other liabilities | 5,831 | 5,434 |
Total accrued expenses and other liabilities | $ 57,823 | $ 59,320 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate swap | $ 14,289 | $ 5,896 |
Fair Value, Inputs, Level 1 | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 102,325 | 39,614 |
Restricted cash | 16,774 | 18,658 |
Fair Value, Inputs, Level 1 | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 102,325 | 39,614 |
Restricted cash | 16,774 | 18,658 |
Fair Value, Inputs, Level 2 | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate caps | 51 | |
Interest rate swap | 14,289 | 5,736 |
Fair Value, Inputs, Level 2 | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Interest rate caps | 51 | |
Interest rate swap | 14,289 | 5,736 |
Fair Value, Inputs, Level 3 | Carrying Value | Mortgage debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Mortgage debt | 1,490,536 | 1,590,632 |
Fair Value, Inputs, Level 3 | Carrying Value | Revolving credit facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Revolving credit facility | 56,228 | 0 |
Fair Value, Inputs, Level 3 | Fair Value | Mortgage debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Mortgage debt | 1,536,901 | 1,592,855 |
Fair Value, Inputs, Level 3 | Fair Value | Revolving credit facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Revolving credit facility | $ 59,403 | $ 0 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Current | ||||
Federal | $ 0 | $ 0 | $ 0 | $ 0 |
State and local | 22 | 37 | 82 | 73 |
Total current provision | 22 | 37 | 82 | 73 |
Deferred | ||||
Federal | 0 | 0 | 0 | 0 |
State and local | 0 | 0 | 0 | 0 |
Total deferred provision | 0 | 0 | 0 | 0 |
Total provision for income taxes | $ 22 | $ 37 | $ 82 | $ 73 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2020 | Dec. 31, 2019 |
Operating Loss Carryforwards [Line Items] | ||
Deferred tax assets, valuation allowance | $ 7.7 | $ 7.9 |
Domestic Tax Authority | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 28.2 | |
State and Local Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | $ 32.7 |
REDEEMABLE PREFERRED STOCK, E_3
REDEEMABLE PREFERRED STOCK, EQUITY AND EARNINGS PER COMMON SHARE - Narrative (Details) - USD ($) | Jan. 01, 2019 | Jan. 31, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||||||||
Redeemable preferred stock, shares issued (in shares) | 400,000 | 400,000 | 400,000 | 400,000 | ||||
Preferred stock, liquidation preference, value | $ 100 | $ 100 | ||||||
Preferred stock, dividend rate, percentage | 6.00% | |||||||
Redeemable preferred stock, liquidation preference | $ 40,000,000 | |||||||
Common stock, shares reserved for future issuance (shares) | 27,922,570 | |||||||
Expiration period | 10 years | |||||||
Share-based payment arrangement, expense | $ 1,700,000 | $ 500,000 | $ 3,100,000 | $ 1,000,000 | ||||
Reduction in strike price (in dollars per share) | $ 0.52 | |||||||
Minimum | ||||||||
Related Party Transaction [Line Items] | ||||||||
Award vesting period | 1 year | |||||||
Maximum | ||||||||
Related Party Transaction [Line Items] | ||||||||
Award vesting period | 3 years | |||||||
On or after December 31, 2020 | ||||||||
Related Party Transaction [Line Items] | ||||||||
Preferred stock, redemption, percentage of outstanding stock that may be redeemed | 50.00% | |||||||
Former Manager | ||||||||
Related Party Transaction [Line Items] | ||||||||
Grants in period (in shares) | 20,098 |
REDEEMABLE PREFERRED STOCK, E_4
REDEEMABLE PREFERRED STOCK, EQUITY AND EARNINGS PER COMMON SHARE - Rollforward of Redeemable Preferred Stock (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||
Balance as of December 31, 2019 | $ 40,506 | |
Accrued dividend on Redeemable Preferred Stock | 1,197 | |
Paid dividend on Redeemable Preferred Stock | (1,203) | $ (697) |
Balance as of June 30, 2020 | $ 40,500 |
REDEEMABLE PREFERRED STOCK, E_5
REDEEMABLE PREFERRED STOCK, EQUITY AND EARNINGS PER COMMON SHARE - Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | ||
Numerator | |||||
Income (Loss) from continuing operations attributable to common stockholders | $ (3,257) | $ (7,534) | $ (14,903) | $ (17,405) | |
Discontinued operations, net | 0 | (2,651) | 16,885 | (4,571) | |
Net income (loss) attributable to common stockholders | (3,257) | (10,185) | 1,982 | (21,976) | |
Less: Non-forfeitable dividends allocated to participating RSUs | (28) | 0 | (59) | 0 | |
Net income (loss) available to common shares outstanding | $ (3,285) | $ (10,185) | $ 1,923 | $ (21,976) | |
Denominator | |||||
Weighted average number of shares of common stock outstanding, Basic (in shares) | 82,459,741 | 82,209,844 | 82,423,182 | 82,206,475 | |
Dilutive common shares - equity awards and option (in shares) | 0 | 0 | 0 | 0 | |
Weighted average number of shares of common stock outstanding, Diluted (in shares) | 82,459,741 | 82,209,844 | 82,423,182 | 82,206,475 | |
Basic earnings per common share: | |||||
Loss from continuing operations attributable to common stockholders (in dollars per share) | [1] | $ (0.04) | $ (0.09) | $ (0.18) | $ (0.21) |
Discontinued operations, net (in dollars per share) | [1] | 0 | (0.03) | 0.20 | (0.06) |
Net income (loss) attributable to common stockholders, basic (in dollars per share) | [1] | (0.04) | (0.12) | 0.02 | (0.27) |
Diluted earnings per common share: | |||||
Loss from continuing operations attributable to common stockholders (in dollars per share) | [1] | (0.04) | (0.09) | (0.18) | (0.21) |
Discontinued operations, net (in dollars per share) | [1] | 0 | (0.03) | 0.20 | (0.06) |
Net income (loss) attributable to common stockholders, diluted (in dollars per share) | [1] | $ (0.04) | $ (0.12) | $ 0.02 | $ (0.27) |
Restricted stock awards issued (in shares) | 454,921 | 916,415 | |||
Equity Option | |||||
Diluted earnings per common share: | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 292,483 | 1,694,244 | 947,465 | 1,335,826 | |
[1] | Basic earnings per common share (“EPS”) is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding. The outstanding shares used to calculate the weighted average basic shares exclude 454,921 and 916,415 restricted stock awards, net of forfeitures, as of June 30, 2020 and 2019, respectively, as those shares were issued but were not vested and therefore, not considered outstanding for purposes of computing basic EPS share. Diluted EPS is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding plus the additional dilutive effect, if any, of common stock equivalents during each period. |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Narrative (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Triple Net Lease Properties | Watermark | |
Long-term Purchase Commitment [Line Items] | |
Lease period | 15 years |
Triple Net Lease Properties | Watermark | Additional Capital Improvements | |
Long-term Purchase Commitment [Line Items] | |
Capital improvements | $ 1 |
Minimum | |
Long-term Purchase Commitment [Line Items] | |
Remaining lease term | 1 month |
Maximum | |
Long-term Purchase Commitment [Line Items] | |
Remaining lease term | 4 years |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Future Minimum Lease Obligations under Operating Leases (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Commitments and Contingencies Disclosure [Abstract] | ||
2020 (six months) | $ 255 | |
2021 | 645 | |
2022 | 508 | |
2023 | 466 | |
2024 | 235 | |
Thereafter | 310 | |
Total future minimum lease payments | 2,419 | |
Less imputed interest | (409) | |
Total operating lease liability | $ 2,010 | $ 1,942 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - $ / shares | Aug. 03, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 |
Subsequent Event [Line Items] | |||||
Dividends declared (in dollars per share) | $ 0.065 | $ 0.13 | $ 0.195 | $ 0.26 | |
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Dividends declared (in dollars per share) | $ 0.065 |
Uncategorized Items - snr-20200
Label | Element | Value | [1] |
Restricted Cash | us-gaap_RestrictedCash | $ 16,793,000 | |
Restricted Cash | us-gaap_RestrictedCash | 23,193,000 | |
Restricted Cash | us-gaap_RestrictedCash | 20,234,000 | |
Restricted Cash | us-gaap_RestrictedCash | $ 24,215,000 | |
[1] | Restricted cash consists of (i) amounts held by lender in tax, insurance, replacement reserve and other escrow accounts and (ii) security deposits; amounts relating to continuing operations are included in “Receivables and other assets, net” in our Consolidated Balance Sheets. |