Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 30, 2019 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | Community Healthcare Trust Inc | |
Entity Central Index Key | 0001631569 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Small Business | true | |
Entity Common Stock, Shares Outstanding | 18,862,792 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Real estate properties | ||
Land and land improvements | $ 52,520 | $ 50,270 |
Buildings, improvements, and lease intangibles | 425,763 | 394,527 |
Personal property | 135 | 133 |
Total real estate properties | 478,418 | 444,930 |
Less accumulated depreciation | (60,544) | (55,298) |
Total real estate properties, net | 417,874 | 389,632 |
Cash and cash equivalents | 3,868 | 2,007 |
Restricted cash | 166 | 385 |
Other assets, net | 34,822 | 34,546 |
Total assets | 456,730 | 426,570 |
Liabilities | ||
Debt, net | 179,117 | 147,766 |
Accounts payable and accrued liabilities | 3,351 | 3,196 |
Other liabilities | 4,579 | 3,949 |
Total liabilities | 187,047 | 154,911 |
Commitments and contingencies | ||
Stockholders' Equity | ||
Preferred stock, $0.01 par value; 50,000,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.01 par value; 450,000,000 shares authorized; 18,862,792 and 18,634,502 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively | 189 | 186 |
Additional paid-in capital | 342,654 | 337,180 |
Cumulative net income | 10,628 | 9,178 |
Accumulated other comprehensive (loss) income | (642) | 633 |
Cumulative dividends | (83,146) | (75,518) |
Total stockholders’ equity | 269,683 | 271,659 |
Total liabilities and stockholders' equity | $ 456,730 | $ 426,570 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred Stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 450,000,000 | 450,000,000 |
Common Stock, shares issued | 18,862,792 | 18,634,502 |
Common Stock, shares outstanding | 18,862,792 | 18,634,502 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
REVENUES | ||
Rental income | $ 12,898 | $ 11,075 |
Revenues | 13,441 | 11,429 |
EXPENSES | ||
Property operating | 3,075 | 2,364 |
General and administrative | 1,785 | 1,193 |
Depreciation and amortization | 5,246 | 4,916 |
Expenses | 10,106 | 8,473 |
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND OTHER ITEMS | 3,335 | 2,956 |
Interest expense | (2,054) | (1,268) |
Interest and other income, net | 169 | 184 |
INCOME FROM CONTINUING OPERATIONS | 1,450 | 1,872 |
NET INCOME | $ 1,450 | $ 1,872 |
NET INCOME PER COMMON SHARE: | ||
Net income per common share – Basic (in dollars per share) | $ 0.06 | $ 0.09 |
Net income per common share – Diluted (in dollars per share) | $ 0.06 | $ 0.09 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-BASIC (in shares) | 17,954,670 | 17,573,683 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-DILUTED (in shares) | 17,954,670 | 17,573,683 |
Other operating interest | ||
REVENUES | ||
Revenue | $ 543 | $ 354 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
NET INCOME | $ 1,450 | $ 1,872 |
Other comprehensive income (loss): | ||
(Decrease) increase in fair value of cash flow hedges | (1,213) | 906 |
Reclassification for amounts recognized as interest expense | 62 | (68) |
Total other comprehensive (loss) income | (1,275) | 974 |
COMPREHENSIVE INCOME | $ 175 | $ 2,846 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid in Capital [Member] | Cumulative Net Income [Member] | Accumulated Other Comprehensive Income [Member] | Cumulative Dividends [Member] |
Beginning Balance at Dec. 31, 2017 | $ 283,374 | $ 181 | $ 324,303 | $ 4,775 | $ 258 | $ (46,143) |
Beginning Balance, shares at Dec. 31, 2017 | 18,085,798 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation, shares | 94,001 | |||||
Stock-based compensation | 616 | $ 1 | 615 | |||
Unrecognized gain (loss) on cash flow hedges | 906 | 906 | ||||
Reclassification adjustment for (gains) losses included in net income (interest expense) | 68 | 68 | ||||
Net income | 1,872 | 1,872 | ||||
Dividends to common stockholders | (7,226) | (7,226) | ||||
Ending Balance, shares at Mar. 31, 2018 | 18,179,799 | |||||
Ending Balance at Mar. 31, 2018 | 279,610 | $ 182 | 324,918 | 6,647 | 1,232 | (53,369) |
Beginning Balance at Dec. 31, 2017 | $ 283,374 | $ 181 | 324,303 | 4,775 | 258 | (46,143) |
Beginning Balance, shares at Dec. 31, 2017 | 18,085,798 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock, net of issuance costs (in shares) | 334,700 | |||||
Ending Balance, shares at Dec. 31, 2018 | 18,634,502 | |||||
Ending Balance at Dec. 31, 2018 | $ 271,659 | $ 186 | 337,180 | 9,178 | 633 | (75,518) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock, net of issuance costs (in shares) | 143,600 | 143,600 | ||||
Issuance of common stock, net of issuance costs | $ 4,624 | $ 2 | 4,622 | |||
Stock-based compensation, shares | 84,690 | |||||
Stock-based compensation | 853 | $ 1 | 852 | |||
Unrecognized gain (loss) on cash flow hedges | (1,213) | (1,213) | ||||
Reclassification adjustment for (gains) losses included in net income (interest expense) | (62) | (62) | ||||
Net income | 1,450 | 1,450 | ||||
Dividends to common stockholders | (7,628) | (7,628) | ||||
Ending Balance, shares at Mar. 31, 2019 | 18,862,792 | |||||
Ending Balance at Mar. 31, 2019 | $ 269,683 | $ 189 | $ 342,654 | $ 10,628 | $ (642) | $ (83,146) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cumulative Dividends [Member] | ||
Dividends to common stockholders, per share (in dollars per share) | $ 0.4075 | $ 0.3975 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
OPERATING ACTIVITIES | ||
Net income | $ 1,450 | $ 1,872 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 5,421 | 5,133 |
Stock-based compensation | 853 | 616 |
Straight-line rent receivable | (336) | (415) |
Deferred income tax expense (benefit) | 17 | (132) |
Changes in operating assets and liabilities: | ||
Other assets | (194) | (696) |
Accounts payable and accrued liabilities | 155 | (309) |
Other liabilities | (36) | (121) |
Net cash provided by operating activities | 7,330 | 5,948 |
INVESTING ACTIVITIES | ||
Acquisitions of real estate | (32,743) | (12,721) |
Acquisitions of notes receivable | 0 | (2,201) |
Proceeds from the repayment of notes receivable | 31 | 17 |
Capital expenditures on existing real estate properties | (622) | (1,444) |
Net cash used in investing activities | (33,334) | (16,349) |
FINANCING ACTIVITIES | ||
Net repayments on revolving credit facility | (43,000) | (22,000) |
Term loan borrowings | 75,000 | 40,000 |
Mortgage note repayments | (27) | 0 |
Dividends paid | (7,628) | (7,226) |
Net proceeds from issuance of common stock | 4,724 | 0 |
Equity issuance costs | (100) | 0 |
Debt issuance costs | (1,323) | (218) |
Net cash provided by financing activities | 27,646 | 10,556 |
Increase in cash and cash equivalents and restricted cash | 1,642 | 155 |
Cash and cash equivalents and restricted cash, beginning of period | 2,392 | 2,130 |
Cash and cash equivalents and restricted cash, end of period | 4,034 | 2,285 |
Supplemental Cash Flow Information: | ||
Interest paid | 1,783 | 1,105 |
Invoices accrued for construction, tenant improvement and other capitalized costs | 81 | 712 |
Reclassification between accounts and notes receivable | 40 | 0 |
Reclassification of registration statement costs incurred in prior year to equity issuance costs | 100 | 0 |
(Decrease) increase in fair value of cash flow hedges | $ (1,213) | $ 906 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Business Overview Community Healthcare Trust Incorporated (the ‘‘Company’’, ‘‘we’’, ‘‘our’’) was organized in the State of Maryland on March 28, 2014. The Company is a fully-integrated healthcare real estate company that owns and acquires real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers in our target submarkets. As of March 31, 2019 , the Company had investments of approximately $478.4 million in 105 real estate properties, located in 29 states, totaling approximately 2.3 million square feet in the aggregate. Basis of Presentation The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and footnotes required by GAAP for complete financial statements. This interim financial information should be read in conjunction with the financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 . Management believes that all adjustments of a normal, recurring nature considered necessary for a fair presentation have been included. This interim financial information does not necessarily represent or indicate what the operating results will be for the year ending December 31, 2019 . All material intercompany accounts and transactions have been eliminated. Use of Estimates in the Condensed Consolidated Financial Statements Preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions that affect amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Actual results may materially differ from those estimates. Reclassifications Tenant reimbursements totaling $1.4 million on the Company's Condensed Consolidated Statements of Income for the three months ended March 31, 2018 were reclassified into rental income. Income Taxes The Company has elected to be taxed as a real estate investment trust ("REIT"), as defined under the Internal Revenue Code of 1986, as amended (the "Code"). The Company and one subsidiary have also elected for that subsidiary to be treated as a taxable REIT subsidiary ("TRS"), which is subject to federal and state income taxes. No provision has been made for federal income taxes for the REIT; however, the Company has recorded income tax expense or benefit for the TRS to the extent applicable. The Company intends at all times to qualify as a REIT under the Code. The Company must distribute at least 90% per annum of its REIT taxable income to its stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP) and meet other requirements to continue to qualify as a REIT. New Accounting Pronouncements Recently Adopted Accounting Pronouncements Lease Accounting In February 2016, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases; in January 2018, the FASB issued ASU 2018-01, Leases - Land Easement Practical Expedient for Transition to Topic 842; in July 2018, the FASB issued ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases - Targeted Improvements; and in December 2018, the FASB issued ASU 2018-20, Narrow-Scope Improvements for Lessors. The Company adopted this group of ASUs, collectively referred to as Topic 842, on January 1, 2019. Topic 842 superseded the existing standards for lease accounting (Topic 840, Leases). The Company elected to utilize the following practical expedients provided by Topic 842: • the package of practical expedients that allows an entity not to reassess upon adoption (i) whether an expired or existing contract contains a lease, (ii) whether a lease classification related to expired or existing lease arrangements, and (iii) whether costs incurred on expired or existing leases qualify as initial direct costs, and • as a lessor, the practical expedient not to separate certain non-lease components, such as common area maintenance, from the lease component if (i) the timing and pattern of transfer are the same for the nonlease component and associated lease component, and (ii) the lease component would be classified as an operating lease if accounted for separately. Topic 842 requires lessees to record most leases on their balance sheet through a right-of-use ("ROU") model, in which a lessee records a ROU asset and a lease liability on their balance sheet. Leases with terms that are 12 months or less or leases that are clearly insignificant do not need to be accounted for under the ROU model. Lessees will account for leases as financing or operating leases, with the classification affecting the timing and pattern of expense recognition in the income statement. Lease expense will be recognized based on the effective interest method for leases accounted for as finance leases and on a straight-line basis over the term of the lease for leases accounted for as operating leases. The accounting by a lessor under Topic 842 is largely unchanged from that of Topic 840. Under Topic 842, lessors will continue to account for leases as a sales-type, direct-financing, or operating. A lease will be treated as a sale if it is considered to transfer control of the underlying asset to the lessee. A lease will be classified as direct-financing if risks and rewards are conveyed without the transfer of control. Otherwise, the lease is treated as an operating lease. Topic 842 requires accounting for a transaction as a financing in a sale leaseback when the seller-lessee is provided an option to purchase the property from the landlord at the tenant's option. The Company expects that this provision could change the accounting for these types of leases in the future. Topic 842 also includes the concept of separating lease and nonlease components. Under Topic 842, nonlease components, such as common area maintenance, would be accounted for under Topic 606 and separated from the lease payments. However, the Company elected the lessor practical expedient allowing the Company to not separate these components when certain conditions are met. With this election, the Company combined tenant reimbursements with rental income on its Condensed Consolidated Income Statements. Additionally, we will recognize a charge to rental income for amounts deemed uncollectible. Further, the Company has historically only capitalized direct leasing costs, such as leasing commissions. While the new standard revises the treatment of indirect leasing costs and permits the capitalization and amortization only of direct leasing costs, the Company does not expect an impact to its financial statements related to the capitalization of leasing costs. Also, the Narrow-Scope Improvements for Lessors under ASU 2018-20 allows the Company to continue to exclude from revenue costs paid by our tenants on our behalf directly to third parties, such as property taxes and insurance. Topic 842 provided two transition alternatives. The Company adopted the standard based on the prospective optional transition method, in which leases for comparative periods continue to be accounted for in accordance with Topic 840. Upon adoption, where the Company is the lessee, we recorded a right of use asset and a related operating lease liability, each totaling approximately $0.1 million , related to one ground lease which will have minimal impact on the recognition of future ground lease expense. The right of use lease asset is included in other assets and the operating lease liability is included in other liabilities on the Company's Condensed Consolidated Balance Sheet. Derivatives and Hedge Accounting In October 2018, the FASB issued an update, ASU 2018-16, Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes to ASC Topic 815, Derivatives and Hedging. ASU 2018-16 expands the list of U.S. benchmark interest rates permitted in the application of hedge accounting by adding the OIS rate based on SOFR as an eligible benchmark interest rate. ASU 2018-16 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2018. We adopted this update effective January 1, 2019. The adoption of this update did not have an impact on our Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Financial Instruments-Credit Losses In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses, which changes the impairment model for most financial assets and certain other instruments. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, companies will be required to use a new current expected credit loss ("CECL") model that generally will result in the earlier recognition of allowances for losses. For available-for-sale debt securities with unrealized losses, companies will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than as reductions in the amortized cost of the securities. Companies will have to disclose significantly more information, including information they use to track credit quality by year of origination for most financing receivables. Companies will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This standard is effective for the Company on January 1, 2020 with early adoption permitted. In August 2018, the FASB issued a proposal that would amend the ASU to clarify that receivables arising from leases would not be within the scope of the ASU but rather would be accounted for under the leasing standard. The Company continues to monitor the FASB's activity relating to this ASU. |
Real Estate Investments
Real Estate Investments | 3 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Real Estate Investments | Real Estate Investments At March 31, 2019 , the Company had investments of approximately $478.4 million in 105 real estate properties. The following table summarizes the Company's real estate investments. (Dollars in thousands) Number of Facilities Land and Land Improvements Buildings, Improvements, and Lease Intangibles Personal Property Total Accumulated Depreciation Medical office buildings: Florida 5 $ 4,608 $ 29,285 $ — $ 33,893 $ 4,515 Ohio 6 3,638 26,483 — 30,121 5,508 Texas 3 3,115 15,591 — 18,706 4,456 Illinois 2 1,136 11,831 — 12,967 2,664 Kansas 3 2,455 14,933 — 17,388 4,189 Iowa 1 2,241 9,014 — 11,255 2,468 Other states 15 4,355 35,828 — 40,183 4,649 35 21,548 142,965 — 164,513 28,449 Physician clinics: Kansas 2 610 6,921 — 7,531 1,485 Illinois 6 2,888 9,539 — 12,427 540 Florida 4 253 9,484 — 9,737 912 Other states 9 2,903 21,462 — 24,365 3,459 21 6,654 47,406 — 54,060 6,396 Surgical centers and hospitals: Louisiana 1 1,683 21,353 — 23,036 1,244 Michigan 2 637 8,278 — 8,915 2,434 Illinois 2 2,349 8,222 — 10,571 1,411 Florida 1 271 7,069 — 7,340 810 Arizona 2 576 5,389 — 5,965 1,603 Other states 7 2,130 17,857 — 19,987 4,074 15 7,646 68,168 — 75,814 11,576 Specialty centers: Illinois 3 3,489 24,733 — 28,222 2,117 Other states 22 5,170 38,344 — 43,514 7,331 25 8,659 63,077 — 71,736 9,448 Behavioral facilities: West Virginia 1 2,138 22,897 — 25,035 880 Illinois 1 1,300 18,803 — 20,103 1,332 Indiana 2 1,126 6,040 — 7,166 351 Other states 3 1,411 12,840 — 14,251 499 7 5,975 60,580 — 66,555 3,062 Inpatient rehabilitation facilities: Texas 1 1,515 27,001 — 28,516 82 1 1,515 27,001 — 28,516 82 Long-term acute care hospitals: Indiana 1 523 14,405 — 14,928 1,222 1 523 14,405 — 14,928 1,222 Corporate property — — 2,161 135 2,296 309 Total real estate investments 105 $ 52,520 $ 425,763 $ 135 $ 478,418 $ 60,544 |
Real Estate Leases
Real Estate Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Real Estate Leases | Real Estate Leases The Company’s properties are generally leased pursuant to non-cancelable, fixed-term operating leases with expiration dates through 2034 . The Company’s leases generally require the lessee to pay minimum rent, with fixed rent renewal terms or increases based on a Consumer Price Index and and may also include additional rent, which may include taxes (including property taxes), insurance, maintenance and other operating costs associated with the leased property. Some leases provide the lessee, during the term of the lease, with an option or right of first refusal to purchase the leased property. Some leases also allow the lessee to renew or extend their lease term or in some cases terminate their lease, based on conditions provided in the lease. Future minimum lease payments under the non-cancelable operating leases due the Company for the years ending December 31, as of March 31, 2019 , are as follows (in thousands): 2019 (nine months ending December 31) $ 32,823 2020 41,304 2021 38,200 2022 34,688 2023 30,177 2024 and thereafter 156,754 $ 333,946 Straight-line rental income Rental income is recognized as earned over the life of the lease agreement on a straight-line basis. Straight-line rent included in rental income was approximately $0.3 million and $0.4 million , respectively, for the three months ended March 31, 2019 and 2018 . Deferred revenue Rent received but not yet earned is deferred until such time it is earned. Deferred revenue, included in other liabilities, was approximately $ 1.5 million and $1.6 million , respectively, at March 31, 2019 and December 31, 2018 . |
Real Estate Acquisitions
Real Estate Acquisitions | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Real Estate Acquisitions | Real Estate Acquisitions During the first quarter of 2019, the Company acquired two real estate properties totaling approximately 83,000 square feet for an aggregate purchase price and cash consideration of approximately $32.7 million . Upon acquisition, the properties were 100% leased in the aggregate with lease expirations in 2029 . Amounts reflected in revenues and net income for the three months ended March 31, 2019 for these properties were approximately $0.4 million and $0.2 million , respectively. Transaction costs totaling approximately $0.1 million related to these asset acquisitions were capitalized in the period and included in real estate assets. |
Mortgage and Other Notes Receiv
Mortgage and Other Notes Receivable | 3 Months Ended |
Mar. 31, 2019 | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | |
Mortgage and Other Notes Receivable | Mortgage and Other Notes Receivable The Company had one mortgage note receivable outstanding as of December 31, 2017 with a principal balance of $10.6 million and interest receivable of $0.6 million , which is included in other assets. The borrower and several related entities (the "Borrower") filed for voluntary bankruptcy on June 23, 2017. At the time of filing for bankruptcy, the Borrower was current on all obligations to the Company, but no payments were received during the bankruptcy. On December 28, 2017, the Company purchased $11.45 million face value of certain promissory notes, secured by accounts receivable of the Borrower, for $8.75 million from a syndicate of banks, a $2.7 million discount to face value, and in the first quarter of 2018 acquired $2.2 million of certain promissory notes, secured by the operations of two facilities related to the Borrower, but were not included in the bankruptcy, for a total investment in these promissory notes of approximately $10.95 million . On April 25, 2018, the Company provided a $23.0 million loan, included in other assets, to a newly formed company (Newco), secured by all assets and ownership interests in seven long-term acute care hospitals and one inpatient rehabilitation hospital that, along with a series of investments by the management of Newco, allowed Newco to acquire certain assets of the Borrower. Also on April 25, 2018, $10.95 million of the promissory notes discussed above, approximately $0.26 million of interest on those promissory notes, approximately $0.25 million in fees and reimbursement of expenses, and approximately $6.7 million principal and accrued interest related to its mortgage note receivable were satisfied with proceeds from the loan. In addition, the Company received title to the property previously financed by the mortgage note receivable at an approximate $4.5 million valuation. No impairment was recognized by the Company. |
Debt, net
Debt, net | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt, net | Debt, net The table below details the Company's debt as of March 31, 2019 and December 31, 2018 . Balance as of (Dollars in thousands) March 31, 2019 December 31, 2018 Maturity Dates Revolving Credit Facility $ — $ 43,000 3/23 A-1 Term Loan, net 49,778 49,759 3/22 A-2 Term Loan, net 49,735 49,722 3/24 A-3 Term Loan, net 74,341 — 3/26 Mortgage Note Payable 5,263 5,285 5/24 $ 179,117 $ 147,766 The Company's second amended and restated credit facility (the "Credit Facility") is by and among Community Healthcare OP, LP, the Company, the lenders from time to time party thereto, and SunTrust Bank, as Administrative Agent. The Company’s material subsidiaries are guarantors of the obligations under the Credit Facility. The Company entered into a third amendment to its Credit Facility (the "Third Amendment") on March 29, 2019 , which added a $75.0 million term loan (the "A-3 Term Loan"), which matures on March 29, 2026 , extended the maturity of the revolving credit facility (the "Revolving Credit Facility") to March 29, 2023 , improved pricing on the Credit Facility, and adjusted certain financial covenants. The Company paid approximately $1.3 million in fees and expenses related to the Third Amendment, of which $0.7 million was related to the Revolving Credit Facility and was recorded as deferred financing costs, included in Other Assets, and $0.6 million was related to the A-3 Term Loan and was recorded as deferred financing costs, included in Debt, net, on the Company's Condensed Consolidated Balance Sheet. The Credit Facility, as amended, provides for a $150.0 million Revolving Credit Facility and $175.0 million in term loans (the "Term Loans"). The Credit Facility, through the accordion feature, allows borrowings up to a total of $525.0 million including the ability to add and fund additional term loans. The Revolving Credit Facility matures on March 29, 2023 and includes one 12 -month option to extend the maturity date of the Revolving Credit Facility, subject to the satisfaction of certain conditions. The Term Loans include a five -year term loan facility in the aggregate principal amount of $50.0 million (the "A-1 Term Loan"), which matures on March 29, 2022 , a seven -year term loan facility in the aggregate principal amount of $50.0 million (the "A-2 Term Loan"), which matures on March 29, 2024 and the new seven -year, $75.0 million A-3 Term Loan, which matures on March 29, 2026 . Amounts outstanding under the Revolving Credit Facility, as amended, bear annual interest at a floating rate that is based, at the Company’s option, on either: (i) LIBOR plus 1.25% to 1.90% or (ii) a base rate plus 0.25% to 0.90% in each case, depending upon the Company’s leverage ratio. In addition, the Company is obligated to pay an annual fee equal to 0.25% of the amount of the unused portion of the Revolving Credit Facility if amounts borrowed are greater than 33.3% of the borrowing capacity under the Revolving Credit Facility and 0.35% of the unused portion of the Revolving Credit Facility if amounts borrowed are less than or equal to 33.3% of the borrowing capacity under the Revolving Credit Facility. The Company repaid the amounts outstanding under its Revolving Credit Facility with proceeds from the A-3 Term Loan and therefore had the full borrowing capacity under the Revolving Credit Facility of $150.0 million at March 31, 2019. Amounts outstanding under the Term Loans, as amended, bear annual interest at a floating rate that is based, at the Company’s option, on either: (i) LIBOR plus 1.25% to 2.30% or (ii) a base rate plus 0.25% to 1.30% , in each case, depending upon the Company’s leverage ratio. In addition, the Company is obligated to pay an annual fee equal to 0.35% of the amount of the unused portion of the Term Loans. The Company has entered into interest rate swaps to fix the interest rates on the Term Loans. See Note 7 for more details on the interest rate swaps. At March 31, 2019 , the Company had drawn the full $175.0 million under the Term Loans which had a fixed weighted average interest rate under the swaps of approximately 4.569% . The Company’s ability to borrow under the Credit Facility is subject to its ongoing compliance with a number of customary affirmative and negative covenants, including limitations with respect to liens, indebtedness, distributions, mergers, consolidations, investments, restricted payments and asset sales, as well as financial maintenance covenants. The Company was in compliance with its financial covenants under its Credit Facility as of March 31, 2019 . |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments Risk Management Objective of Using Derivatives The Company may use derivative financial instruments, including interest rate swaps, caps, options, floors and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company’s operating and financial structure as well as to hedge specific anticipated transactions. The Company does not intend to utilize derivatives for speculative or other purposes other than interest rate risk management. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps and/or caps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest rate caps designated as cash flow hedges involve the receipt of variable-rate amounts if interest rates rise above the cap strike rate on the contract. As of March 31, 2019 , the Company had seven outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk for notional amounts totaling $175.0 million . The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018 . Asset Derivatives Fair Value at Liability Derivatives Fair Value at March 31, 2019 December 31, 2018 Balance Sheet Classification March 31, 2019 December 31, 2018 Balance Sheet Classification Interest rate swaps $ 215 $ 902 Other assets $ 857 $ 98 Other Liabilities The changes in the fair value of derivatives designated and that qualify as cash flow hedges are recorded in accumulated other comprehensive income and are subsequently reclassified to interest expense in the period that the hedged forecasted transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s Term Loans. During the next twelve months, the Company estimates that an additional $0.2 million will be reclassified from other comprehensive income ("OCI") as a decrease to interest expense. The table below details the location in the financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three months ended March 31, 2019 and 2018 . Three Months Ended March 31, (Dollars in thousands) 2019 2018 Amount of unrealized (loss) gain recognized in OCI on derivative $ (1,213 ) $ 906 Amount of (gain) loss reclassified from accumulated OCI into interest expense $ (62 ) $ 68 Total Interest Expense presented in the Condensed Consolidated Statements of Income in which the effects of the cash flow hedges are recorded $ 2,054 $ 1,268 Credit-risk-related Contingent Feature s As of March 31, 2019, the fair value of derivatives in a net liability position including accrued interest but excluding any adjustment for nonperformance risk related to these agreements was $0.7 million . As of March 31, 2019, the Company has not posted any collateral related to these agreements and was not in breach of any agreement provisions. If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value of approximately $0.7 million at March 31, 2019. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock The following table provides a reconciliation of the beginning and ending common stock balances for the three months ended March 31, 2019 and for the year ended December 31, 2018 : Three Months Ended Year Ended December 31, 2018 Balance, beginning of period 18,634,502 18,085,798 Issuance of common stock 143,600 334,700 Restricted stock-based awards 84,690 214,004 Balance, end of period 18,862,792 18,634,502 ATM Program On August 7, 2018, the Company entered into an at-the-market offering program ("ATM Program") with Sandler O’Neill & Partners, L.P., Evercore Group L.L.C., SunTrust Robinson Humphrey, Inc., BB&T Capital Markets, a division of BB&T Securities, LLC, Fifth Third Securities, Inc. and Janney Montgomery Scott LLC, as sales agents (collectively, the “Agents”), under which the Company may issue and sell shares of its common stock, par value $0.01 per share (the “Common Stock”), having an aggregate gross sales price of up to $100.0 million (the “Shares”) from time to time through or to one or more of the Agents, as may be determined by the Company in its sole discretion, subject to the terms and conditions of the Agreement and applicable law. During the first quarter of 2019 , the Company issued, through its ATM Program, 143,600 shares of common stock at an average gross sales price of $33.57 per share and received net proceeds of approximately $4.7 million . As of March 31, 2019 , the Company had approximately $84.8 million remaining that may be issued under the ATM Program. |
Net Income Per Common Share
Net Income Per Common Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Income Per Common Share | Net Income Per Common Share The following table sets forth the computation of basic and diluted net income per common share. Three Months Ended (Dollars in thousands, except per share data) 2019 2018 Net income $ 1,450 $ 1,872 Participating securities' share in earnings (324 ) (241 ) Net income, less participating securities' share in earnings $ 1,126 $ 1,631 Weighted average Common Shares outstanding Weighted average Common Shares outstanding 18,735,673 18,164,132 Unvested restricted shares (781,003 ) (590,449 ) Weighted average Common Shares outstanding–Basic 17,954,670 17,573,683 Dilutive potential common shares — — Weighted average Common Shares outstanding –Diluted 17,954,670 17,573,683 Basic Net Income per Common Share $ 0.06 $ 0.09 Diluted Net Income per Common Share $ 0.06 $ 0.09 |
Incentive Plan
Incentive Plan | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Incentive Plan | Incentive Plan Under the Company's 2014 Incentive Plan, as amended, awards may be made in the form of restricted stock, cash or a combination of both. Compensation expense recognized from the amortization of the value of the Company's officer, employee and director shares over the applicable vesting periods during the three months ended March 31, 2019 and 2018 was approximately $0.9 million and $0.6 million , respectively. A summary of the activity under the 2014 Incentive Plan for the three months ended March 31, 2019 and 2018 is included in the table below. Three Months Ended March 31, 2019 2018 Stock-based awards, beginning of period 709,487 512,115 Stock in lieu of compensation 42,525 47,027 Stock awards 42,165 46,974 Total stock granted 84,690 94,001 Vested shares — — Stock-based awards, end of period 794,177 606,116 |
Other Assets
Other Assets | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | Other Assets Items included in Other assets, net on the Company's Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018 are detailed in the table below. Balance as of (Dollars in thousands) March 31, 2019 December 31, 2018 Notes receivable $ 24,119 $ 24,110 Accounts and interest receivables 2,092 2,158 Straight-line rent receivables 3,593 3,254 Prepaid assets 515 487 Deferred financing costs, net 848 318 Leasing commissions, net 862 790 Deferred tax asset 2,008 2,024 Fair value of interest rate swaps 215 902 Above-market intangible assets, net 162 168 Right of use leased asset 141 — Other 267 335 $ 34,822 $ 34,546 The Company's $24.1 million in notes receivable at March 31, 2019 include mainly the following notes. Interest related to these notes is included in Other Operating Interest on the Company's Condensed Consolidated Statements of Income. • On April 25, 2018, the Company provided a $23.0 million loan to a newly formed company (Newco), secured by all assets and ownership interests in seven long-term acute care hospitals and one inpatient rehabilitation hospital. The loan, which matures on May 1, 2031, currently bears interest at 9% per annum, with principal payments beginning in May 2021. See Note 5 for more detail. • On December 31, 2018, the Company entered into notes with a tenant totaling $0.9 million . The notes bear interest at 9% per annum and mature on December 31, 2019. The Company identified the borrowers of these notes as variable interest entities ("VIEs"), but management determined that the Company was not the primary beneficiary of the VIEs because we lack either directly or through related parties any material impact in the activities that impact the borrowers' economic performance. We are not obligated to provide support beyond our stated commitment to the borrowers, and accordingly our maximum exposure to loss as a result of this relationship is limited to the amount of our outstanding notes receivable. The VIEs that we have identified at March 31, 2019 are summarized in the table below. Classification Carrying Amount (in millions) Maximum Exposure to Loss (in millions) Notes receivable $ 0.9 $ 0.9 Note receivable $ 23.0 $ 23.0 Highlands Transition Update As previously announced, the Company experienced payment issues with the old operator of Highlands Hospital ("Highlands"). Effective February 11, 2019, the Company signed a transition agreement (the "Transition Agreement"), to transition the property to a new operator and signed a lease with a new operator. The old operator and new operator have signed an asset purchase agreement pursuant to which the new operator will take over the facility. In addition, the old operator and new operator have signed a management agreement and the new operator is currently managing Highlands pursuant to the management agreement. The new operator continues to perform due diligence and is in the process of preparing for transfer of licenses and related items customary for these types of transactions. We cannot provide assurance as to the timing, or whether, this transaction will actually close. The new lease will be effective upon the transfer of the licenses to the new operator, which is anticipated to happen in the second half of 2019. The new lease provides for rental payments approximately equal to the amounts due under the previous agreements with the old operator. The Company is receiving monthly payments under the Transition Agreement which approximate the amounts due from the old operator under the previous agreements. These payments are to continue as long as the Transition Agreement is in place. The Transition Agreement will terminate when the licenses are transferred to the new operator, at which time the new lease will become effective. Since the Transition Agreement became effective in February, the Company only received payments during the first quarter for February and March and thus did not recognize revenue for the month of January representing approximately $0.3 million . In addition, the Company incurred professional fees (legal and accounting) totaling over $0.1 million related to the workout and transition. The Transition Agreement includes provisions for the Company to receive payment for the amounts due from the old operator that remain unpaid. The Company anticipates collecting all amounts due. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practical to estimate the fair value. Cash and cash equivalents and restricted cash - The carrying amount approximates the fair value. Notes receivable - The fair value is estimated using cash flow analyses, based on an assumed market rate of interest or at a rate consistent with the rates on notes carried by the Company and are classified as level 2 in the hierarchy. Borrowings under our Credit Facility - The carrying amount approximates the fair value because the borrowings are based on variable market interest rates. Derivative financial instruments - The fair value is estimated using discounted cash flow techniques. These techniques incorporate primarily level 2 inputs. The market inputs are utilized in the discounted cash flow calculation considering the instrument’s term, notional amount, discount rate and credit risk. Significant inputs to the derivative valuation model for interest rate swaps are observable in active markets and are classified as level 2 in the hierarchy. Mortgage note payable - The fair value is estimated using cash flow analyses which are based on an assumed market rate of interest or at a rate consistent with the rates on mortgage notes assumed by the Company and are classified as level 2 in the hierarchy. The table below details the fair values and carrying values for our notes receivable, interest rate swaps, and mortgage note payable at March 31, 2019 and December 31, 2018 , using level 2 inputs. March 31, 2019 December 31, 2018 (Dollars in thousands) Carrying Value Fair Value Carrying Value Fair Value Notes receivable $ 24,119 $ 23,948 $ 24,110 $ 23,936 Interest rate swap asset $ 215 $ 215 $ 902 $ 902 Interest rate swap liability $ 857 $ 857 $ 269 $ 269 Mortgage note payable $ 5,365 $ 5,277 $ 5,391 $ 5,307 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Dividend Declared On May 1, 2019 , the Company’s Board of Directors declared a quarterly common stock dividend in the amount of $0.41 per share. The dividend is payable on May 31, 2019 to stockholders of record on May 17, 2019 . Subsequent Acquistion On April 30, 2019, the Company acquired one real estate property that was newly constructed totaling approximately 81,000 square feet for an aggregate purchase price and cash consideration of approximately $27.0 million . Upon acquisition, the property was 100.0% leased with lease expiration in 2034 . The Company funded the acquisition with proceeds from the Company's Revolving Credit Facility totaling $23.0 million with the remainder from cash on hand. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and footnotes required by GAAP for complete financial statements. This interim financial information should be read in conjunction with the financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 . Management believes that all adjustments of a normal, recurring nature considered necessary for a fair presentation have been included. This interim financial information does not necessarily represent or indicate what the operating results will be for the year ending December 31, 2019 . All material intercompany accounts and transactions have been eliminated. |
Use of Estimates in the Condensed Consolidated Financial Statements | Use of Estimates in the Condensed Consolidated Financial Statements Preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions that affect amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Actual results may materially differ from those estimates. |
Reclassifications | Reclassifications Tenant reimbursements totaling $1.4 million on the Company's Condensed Consolidated Statements of Income for the three months ended March 31, 2018 were reclassified into rental income. |
Income Taxes | Income Taxes The Company has elected to be taxed as a real estate investment trust ("REIT"), as defined under the Internal Revenue Code of 1986, as amended (the "Code"). The Company and one subsidiary have also elected for that subsidiary to be treated as a taxable REIT subsidiary ("TRS"), which is subject to federal and state income taxes. No provision has been made for federal income taxes for the REIT; however, the Company has recorded income tax expense or benefit for the TRS to the extent applicable. The Company intends at all times to qualify as a REIT under the Code. The Company must distribute at least 90% per annum of its REIT taxable income to its stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP) and meet other requirements to continue to qualify as a REIT. |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted Accounting Pronouncements Lease Accounting In February 2016, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2016-02, Leases; in January 2018, the FASB issued ASU 2018-01, Leases - Land Easement Practical Expedient for Transition to Topic 842; in July 2018, the FASB issued ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases - Targeted Improvements; and in December 2018, the FASB issued ASU 2018-20, Narrow-Scope Improvements for Lessors. The Company adopted this group of ASUs, collectively referred to as Topic 842, on January 1, 2019. Topic 842 superseded the existing standards for lease accounting (Topic 840, Leases). The Company elected to utilize the following practical expedients provided by Topic 842: • the package of practical expedients that allows an entity not to reassess upon adoption (i) whether an expired or existing contract contains a lease, (ii) whether a lease classification related to expired or existing lease arrangements, and (iii) whether costs incurred on expired or existing leases qualify as initial direct costs, and • as a lessor, the practical expedient not to separate certain non-lease components, such as common area maintenance, from the lease component if (i) the timing and pattern of transfer are the same for the nonlease component and associated lease component, and (ii) the lease component would be classified as an operating lease if accounted for separately. Topic 842 requires lessees to record most leases on their balance sheet through a right-of-use ("ROU") model, in which a lessee records a ROU asset and a lease liability on their balance sheet. Leases with terms that are 12 months or less or leases that are clearly insignificant do not need to be accounted for under the ROU model. Lessees will account for leases as financing or operating leases, with the classification affecting the timing and pattern of expense recognition in the income statement. Lease expense will be recognized based on the effective interest method for leases accounted for as finance leases and on a straight-line basis over the term of the lease for leases accounted for as operating leases. The accounting by a lessor under Topic 842 is largely unchanged from that of Topic 840. Under Topic 842, lessors will continue to account for leases as a sales-type, direct-financing, or operating. A lease will be treated as a sale if it is considered to transfer control of the underlying asset to the lessee. A lease will be classified as direct-financing if risks and rewards are conveyed without the transfer of control. Otherwise, the lease is treated as an operating lease. Topic 842 requires accounting for a transaction as a financing in a sale leaseback when the seller-lessee is provided an option to purchase the property from the landlord at the tenant's option. The Company expects that this provision could change the accounting for these types of leases in the future. Topic 842 also includes the concept of separating lease and nonlease components. Under Topic 842, nonlease components, such as common area maintenance, would be accounted for under Topic 606 and separated from the lease payments. However, the Company elected the lessor practical expedient allowing the Company to not separate these components when certain conditions are met. With this election, the Company combined tenant reimbursements with rental income on its Condensed Consolidated Income Statements. Additionally, we will recognize a charge to rental income for amounts deemed uncollectible. Further, the Company has historically only capitalized direct leasing costs, such as leasing commissions. While the new standard revises the treatment of indirect leasing costs and permits the capitalization and amortization only of direct leasing costs, the Company does not expect an impact to its financial statements related to the capitalization of leasing costs. Also, the Narrow-Scope Improvements for Lessors under ASU 2018-20 allows the Company to continue to exclude from revenue costs paid by our tenants on our behalf directly to third parties, such as property taxes and insurance. Topic 842 provided two transition alternatives. The Company adopted the standard based on the prospective optional transition method, in which leases for comparative periods continue to be accounted for in accordance with Topic 840. Upon adoption, where the Company is the lessee, we recorded a right of use asset and a related operating lease liability, each totaling approximately $0.1 million , related to one ground lease which will have minimal impact on the recognition of future ground lease expense. The right of use lease asset is included in other assets and the operating lease liability is included in other liabilities on the Company's Condensed Consolidated Balance Sheet. Derivatives and Hedge Accounting In October 2018, the FASB issued an update, ASU 2018-16, Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes to ASC Topic 815, Derivatives and Hedging. ASU 2018-16 expands the list of U.S. benchmark interest rates permitted in the application of hedge accounting by adding the OIS rate based on SOFR as an eligible benchmark interest rate. ASU 2018-16 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2018. We adopted this update effective January 1, 2019. The adoption of this update did not have an impact on our Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Financial Instruments-Credit Losses In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses, which changes the impairment model for most financial assets and certain other instruments. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, companies will be required to use a new current expected credit loss ("CECL") model that generally will result in the earlier recognition of allowances for losses. For available-for-sale debt securities with unrealized losses, companies will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than as reductions in the amortized cost of the securities. Companies will have to disclose significantly more information, including information they use to track credit quality by year of origination for most financing receivables. Companies will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This standard is effective for the Company on January 1, 2020 with early adoption permitted. In August 2018, the FASB issued a proposal that would amend the ASU to clarify that receivables arising from leases would not be within the scope of the ASU but rather would be accounted for under the leasing standard. The Company continues to monitor the FASB's activity relating to this ASU. |
Real Estate Investments (Tables
Real Estate Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Schedule of real estate property investments | At March 31, 2019 , the Company had investments of approximately $478.4 million in 105 real estate properties. The following table summarizes the Company's real estate investments. (Dollars in thousands) Number of Facilities Land and Land Improvements Buildings, Improvements, and Lease Intangibles Personal Property Total Accumulated Depreciation Medical office buildings: Florida 5 $ 4,608 $ 29,285 $ — $ 33,893 $ 4,515 Ohio 6 3,638 26,483 — 30,121 5,508 Texas 3 3,115 15,591 — 18,706 4,456 Illinois 2 1,136 11,831 — 12,967 2,664 Kansas 3 2,455 14,933 — 17,388 4,189 Iowa 1 2,241 9,014 — 11,255 2,468 Other states 15 4,355 35,828 — 40,183 4,649 35 21,548 142,965 — 164,513 28,449 Physician clinics: Kansas 2 610 6,921 — 7,531 1,485 Illinois 6 2,888 9,539 — 12,427 540 Florida 4 253 9,484 — 9,737 912 Other states 9 2,903 21,462 — 24,365 3,459 21 6,654 47,406 — 54,060 6,396 Surgical centers and hospitals: Louisiana 1 1,683 21,353 — 23,036 1,244 Michigan 2 637 8,278 — 8,915 2,434 Illinois 2 2,349 8,222 — 10,571 1,411 Florida 1 271 7,069 — 7,340 810 Arizona 2 576 5,389 — 5,965 1,603 Other states 7 2,130 17,857 — 19,987 4,074 15 7,646 68,168 — 75,814 11,576 Specialty centers: Illinois 3 3,489 24,733 — 28,222 2,117 Other states 22 5,170 38,344 — 43,514 7,331 25 8,659 63,077 — 71,736 9,448 Behavioral facilities: West Virginia 1 2,138 22,897 — 25,035 880 Illinois 1 1,300 18,803 — 20,103 1,332 Indiana 2 1,126 6,040 — 7,166 351 Other states 3 1,411 12,840 — 14,251 499 7 5,975 60,580 — 66,555 3,062 Inpatient rehabilitation facilities: Texas 1 1,515 27,001 — 28,516 82 1 1,515 27,001 — 28,516 82 Long-term acute care hospitals: Indiana 1 523 14,405 — 14,928 1,222 1 523 14,405 — 14,928 1,222 Corporate property — — 2,161 135 2,296 309 Total real estate investments 105 $ 52,520 $ 425,763 $ 135 $ 478,418 $ 60,544 |
Real Estate Leases (Tables)
Real Estate Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Schedule of future minimum lease payments for operating leases | Future minimum lease payments under the non-cancelable operating leases due the Company for the years ending December 31, as of March 31, 2019 , are as follows (in thousands): 2019 (nine months ending December 31) $ 32,823 2020 41,304 2021 38,200 2022 34,688 2023 30,177 2024 and thereafter 156,754 $ 333,946 |
Debt, net (Tables)
Debt, net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of debt | The table below details the Company's debt as of March 31, 2019 and December 31, 2018 . Balance as of (Dollars in thousands) March 31, 2019 December 31, 2018 Maturity Dates Revolving Credit Facility $ — $ 43,000 3/23 A-1 Term Loan, net 49,778 49,759 3/22 A-2 Term Loan, net 49,735 49,722 3/24 A-3 Term Loan, net 74,341 — 3/26 Mortgage Note Payable 5,263 5,285 5/24 $ 179,117 $ 147,766 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair value of derivative instruments on balance sheet | The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018 . Asset Derivatives Fair Value at Liability Derivatives Fair Value at March 31, 2019 December 31, 2018 Balance Sheet Classification March 31, 2019 December 31, 2018 Balance Sheet Classification Interest rate swaps $ 215 $ 902 Other assets $ 857 $ 98 Other Liabilities |
Schedule of derivative gain (loss) | The table below details the location in the financial statements of the gain or loss recognized on interest rate derivatives designated as cash flow hedges for the three months ended March 31, 2019 and 2018 . Three Months Ended March 31, (Dollars in thousands) 2019 2018 Amount of unrealized (loss) gain recognized in OCI on derivative $ (1,213 ) $ 906 Amount of (gain) loss reclassified from accumulated OCI into interest expense $ (62 ) $ 68 Total Interest Expense presented in the Condensed Consolidated Statements of Income in which the effects of the cash flow hedges are recorded $ 2,054 $ 1,268 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule of reconciliation of common stock | The following table provides a reconciliation of the beginning and ending common stock balances for the three months ended March 31, 2019 and for the year ended December 31, 2018 : Three Months Ended Year Ended December 31, 2018 Balance, beginning of period 18,634,502 18,085,798 Issuance of common stock 143,600 334,700 Restricted stock-based awards 84,690 214,004 Balance, end of period 18,862,792 18,634,502 |
Net Income Per Common Share (Ta
Net Income Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | The following table sets forth the computation of basic and diluted net income per common share. Three Months Ended (Dollars in thousands, except per share data) 2019 2018 Net income $ 1,450 $ 1,872 Participating securities' share in earnings (324 ) (241 ) Net income, less participating securities' share in earnings $ 1,126 $ 1,631 Weighted average Common Shares outstanding Weighted average Common Shares outstanding 18,735,673 18,164,132 Unvested restricted shares (781,003 ) (590,449 ) Weighted average Common Shares outstanding–Basic 17,954,670 17,573,683 Dilutive potential common shares — — Weighted average Common Shares outstanding –Diluted 17,954,670 17,573,683 Basic Net Income per Common Share $ 0.06 $ 0.09 Diluted Net Income per Common Share $ 0.06 $ 0.09 |
Incentive Plan (Tables)
Incentive Plan (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of nonvested restricted stock activity | A summary of the activity under the 2014 Incentive Plan for the three months ended March 31, 2019 and 2018 is included in the table below. Three Months Ended March 31, 2019 2018 Stock-based awards, beginning of period 709,487 512,115 Stock in lieu of compensation 42,525 47,027 Stock awards 42,165 46,974 Total stock granted 84,690 94,001 Vested shares — — Stock-based awards, end of period 794,177 606,116 |
Other Assets (Tables)
Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Assets | Items included in Other assets, net on the Company's Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018 are detailed in the table below. Balance as of (Dollars in thousands) March 31, 2019 December 31, 2018 Notes receivable $ 24,119 $ 24,110 Accounts and interest receivables 2,092 2,158 Straight-line rent receivables 3,593 3,254 Prepaid assets 515 487 Deferred financing costs, net 848 318 Leasing commissions, net 862 790 Deferred tax asset 2,008 2,024 Fair value of interest rate swaps 215 902 Above-market intangible assets, net 162 168 Right of use leased asset 141 — Other 267 335 $ 34,822 $ 34,546 |
Schedule of VIEs | The VIEs that we have identified at March 31, 2019 are summarized in the table below. Classification Carrying Amount (in millions) Maximum Exposure to Loss (in millions) Notes receivable $ 0.9 $ 0.9 Note receivable $ 23.0 $ 23.0 Highlands Transition Update As previously announced, the Company experienced payment issues with the old operator of Highlands Hospital ("Highlands"). Effective February 11, 2019, the Company signed a transition agreement (the "Transition Agreement"), to transition the property to a new operator and signed a lease with a new operator. The old operator and new operator have signed an asset purchase agreement pursuant to which the new operator will take over the facility. In addition, the old operator and new operator have signed a management agreement and the new operator is currently managing Highlands pursuant to the management agreement. The new operator continues to perform due diligence and is in the process of preparing for transfer of licenses and related items customary for these types of transactions. We cannot provide assurance as to the timing, or whether, this transaction will actually close. The new lease will be effective upon the transfer of the licenses to the new operator, which is anticipated to happen in the second half of 2019. The new lease provides for rental payments approximately equal to the amounts due under the previous agreements with the old operator. The Company is receiving monthly payments under the Transition Agreement which approximate the amounts due from the old operator under the previous agreements. These payments are to continue as long as the Transition Agreement is in place. The Transition Agreement will terminate when the licenses are transferred to the new operator, at which time the new lease will become effective. Since the Transition Agreement became effective in February, the Company only received payments during the first quarter for February and March and thus did not recognize revenue for the month of January representing approximately $0.3 million . In addition, the Company incurred professional fees (legal and accounting) totaling over $0.1 million related to the workout and transition. The Transition Agreement includes provisions for the Company to receive payment for the amounts due from the old operator that remain unpaid. The Company anticipates collecting all amounts due. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by Balance Sheet Grouping | The table below details the fair values and carrying values for our notes receivable, interest rate swaps, and mortgage note payable at March 31, 2019 and December 31, 2018 , using level 2 inputs. March 31, 2019 December 31, 2018 (Dollars in thousands) Carrying Value Fair Value Carrying Value Fair Value Notes receivable $ 24,119 $ 23,948 $ 24,110 $ 23,936 Interest rate swap asset $ 215 $ 215 $ 902 $ 902 Interest rate swap liability $ 857 $ 857 $ 269 $ 269 Mortgage note payable $ 5,365 $ 5,277 $ 5,391 $ 5,307 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Business Overview/Segment Reporting (Details) $ in Thousands, ft² in Millions | 3 Months Ended | |||
Mar. 31, 2018USD ($) | Mar. 31, 2019USD ($)ft²statereal_estate_property | Jan. 01, 2019USD ($)lease | Dec. 31, 2018USD ($) | |
Disaggregation of Revenue [Line Items] | ||||
Value of real estate property investments and mortgages | $ 478,400 | |||
Number of real estate properties | real_estate_property | 105 | |||
Number of states in which real estate investments are in | state | 29 | |||
Area of real estate property (in square feet) | ft² | 2.3 | |||
Operating lease ROU assets | $ 141 | $ 0 | ||
Tenant reimbursements | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 1,400 | |||
ASU 2016-02 | ||||
Disaggregation of Revenue [Line Items] | ||||
Operating lease ROU assets | $ 100 | |||
Operating lease liabilities | $ 100 | |||
Number of ground leases | lease | 1 |
Real Estate Investments - Addit
Real Estate Investments - Additional Information (Details) $ in Millions | Mar. 31, 2019USD ($)real_estate_property |
Real Estate [Abstract] | |
Value of real estate property investments and mortgages | $ | $ 478.4 |
Number of real estate properties | real_estate_property | 105 |
Real Estate Investments - Sched
Real Estate Investments - Schedule of Real Estate Property Investments (Details) $ in Thousands | Mar. 31, 2019USD ($)real_estate_property | Dec. 31, 2018USD ($) |
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 105 | |
Land and Land Improvements | $ 52,520 | $ 50,270 |
Buildings, Improvements, and Lease Intangibles | 425,763 | 394,527 |
Personal Property | 135 | 133 |
Total real estate properties | 478,418 | 444,930 |
Accumulated Depreciation | $ 60,544 | $ 55,298 |
Medical office [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 35 | |
Land and Land Improvements | $ 21,548 | |
Buildings, Improvements, and Lease Intangibles | 142,965 | |
Total real estate properties | 164,513 | |
Accumulated Depreciation | $ 28,449 | |
Medical office [Member] | Florida [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 5 | |
Land and Land Improvements | $ 4,608 | |
Buildings, Improvements, and Lease Intangibles | 29,285 | |
Total real estate properties | 33,893 | |
Accumulated Depreciation | $ 4,515 | |
Medical office [Member] | Illinois [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 2 | |
Land and Land Improvements | $ 1,136 | |
Buildings, Improvements, and Lease Intangibles | 11,831 | |
Total real estate properties | 12,967 | |
Accumulated Depreciation | $ 2,664 | |
Medical office [Member] | Iowa [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 2,241 | |
Buildings, Improvements, and Lease Intangibles | 9,014 | |
Total real estate properties | 11,255 | |
Accumulated Depreciation | $ 2,468 | |
Medical office [Member] | Kansas [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 3 | |
Land and Land Improvements | $ 2,455 | |
Buildings, Improvements, and Lease Intangibles | 14,933 | |
Total real estate properties | 17,388 | |
Accumulated Depreciation | $ 4,189 | |
Medical office [Member] | Ohio [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 6 | |
Land and Land Improvements | $ 3,638 | |
Buildings, Improvements, and Lease Intangibles | 26,483 | |
Total real estate properties | 30,121 | |
Accumulated Depreciation | $ 5,508 | |
Medical office [Member] | Other States [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 15 | |
Land and Land Improvements | $ 4,355 | |
Buildings, Improvements, and Lease Intangibles | 35,828 | |
Total real estate properties | 40,183 | |
Accumulated Depreciation | $ 4,649 | |
Medical office [Member] | Texas [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 3 | |
Land and Land Improvements | $ 3,115 | |
Buildings, Improvements, and Lease Intangibles | 15,591 | |
Total real estate properties | 18,706 | |
Accumulated Depreciation | $ 4,456 | |
Physician clinics [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 21 | |
Land and Land Improvements | $ 6,654 | |
Buildings, Improvements, and Lease Intangibles | 47,406 | |
Total real estate properties | 54,060 | |
Accumulated Depreciation | $ 6,396 | |
Physician clinics [Member] | Florida [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 4 | |
Land and Land Improvements | $ 253 | |
Buildings, Improvements, and Lease Intangibles | 9,484 | |
Total real estate properties | 9,737 | |
Accumulated Depreciation | $ 912 | |
Physician clinics [Member] | Illinois [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 6 | |
Land and Land Improvements | $ 2,888 | |
Buildings, Improvements, and Lease Intangibles | 9,539 | |
Total real estate properties | 12,427 | |
Accumulated Depreciation | $ 540 | |
Physician clinics [Member] | Kansas [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 2 | |
Land and Land Improvements | $ 610 | |
Buildings, Improvements, and Lease Intangibles | 6,921 | |
Total real estate properties | 7,531 | |
Accumulated Depreciation | $ 1,485 | |
Physician clinics [Member] | Other States [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 9 | |
Land and Land Improvements | $ 2,903 | |
Buildings, Improvements, and Lease Intangibles | 21,462 | |
Total real estate properties | 24,365 | |
Accumulated Depreciation | $ 3,459 | |
Surgical Centers and Hospitals [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 15 | |
Land and Land Improvements | $ 7,646 | |
Buildings, Improvements, and Lease Intangibles | 68,168 | |
Total real estate properties | 75,814 | |
Accumulated Depreciation | $ 11,576 | |
Surgical Centers and Hospitals [Member] | Arizona [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 2 | |
Land and Land Improvements | $ 576 | |
Buildings, Improvements, and Lease Intangibles | 5,389 | |
Total real estate properties | 5,965 | |
Accumulated Depreciation | $ 1,603 | |
Surgical Centers and Hospitals [Member] | Florida [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 271 | |
Buildings, Improvements, and Lease Intangibles | 7,069 | |
Total real estate properties | 7,340 | |
Accumulated Depreciation | $ 810 | |
Surgical Centers and Hospitals [Member] | Illinois [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 2 | |
Land and Land Improvements | $ 2,349 | |
Buildings, Improvements, and Lease Intangibles | 8,222 | |
Total real estate properties | 10,571 | |
Accumulated Depreciation | $ 1,411 | |
Surgical Centers and Hospitals [Member] | Louisiana [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 1,683 | |
Buildings, Improvements, and Lease Intangibles | 21,353 | |
Total real estate properties | 23,036 | |
Accumulated Depreciation | $ 1,244 | |
Surgical Centers and Hospitals [Member] | Michigan [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 2 | |
Land and Land Improvements | $ 637 | |
Buildings, Improvements, and Lease Intangibles | 8,278 | |
Total real estate properties | 8,915 | |
Accumulated Depreciation | $ 2,434 | |
Surgical Centers and Hospitals [Member] | Other States [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 7 | |
Land and Land Improvements | $ 2,130 | |
Buildings, Improvements, and Lease Intangibles | 17,857 | |
Total real estate properties | 19,987 | |
Accumulated Depreciation | $ 4,074 | |
Specialty Centers [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 25 | |
Land and Land Improvements | $ 8,659 | |
Buildings, Improvements, and Lease Intangibles | 63,077 | |
Total real estate properties | 71,736 | |
Accumulated Depreciation | $ 9,448 | |
Specialty Centers [Member] | Illinois [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 3 | |
Land and Land Improvements | $ 3,489 | |
Buildings, Improvements, and Lease Intangibles | 24,733 | |
Total real estate properties | 28,222 | |
Accumulated Depreciation | $ 2,117 | |
Specialty Centers [Member] | Other States [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 22 | |
Land and Land Improvements | $ 5,170 | |
Buildings, Improvements, and Lease Intangibles | 38,344 | |
Total real estate properties | 43,514 | |
Accumulated Depreciation | $ 7,331 | |
Behavioral facilities [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 7 | |
Land and Land Improvements | $ 5,975 | |
Buildings, Improvements, and Lease Intangibles | 60,580 | |
Total real estate properties | 66,555 | |
Accumulated Depreciation | $ 3,062 | |
Behavioral facilities [Member] | Illinois [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 1,300 | |
Buildings, Improvements, and Lease Intangibles | 18,803 | |
Total real estate properties | 20,103 | |
Accumulated Depreciation | $ 1,332 | |
Behavioral facilities [Member] | Indiana [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 2 | |
Land and Land Improvements | $ 1,126 | |
Buildings, Improvements, and Lease Intangibles | 6,040 | |
Total real estate properties | 7,166 | |
Accumulated Depreciation | $ 351 | |
Behavioral facilities [Member] | Other States [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 3 | |
Land and Land Improvements | $ 1,411 | |
Buildings, Improvements, and Lease Intangibles | 12,840 | |
Total real estate properties | 14,251 | |
Accumulated Depreciation | $ 499 | |
Behavioral facilities [Member] | West Virginia [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 2,138 | |
Buildings, Improvements, and Lease Intangibles | 22,897 | |
Total real estate properties | 25,035 | |
Accumulated Depreciation | $ 880 | |
Inpatient Rehabilitation Facilities [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 1,515 | |
Buildings, Improvements, and Lease Intangibles | 27,001 | |
Total real estate properties | 28,516 | |
Accumulated Depreciation | $ 82 | |
Inpatient Rehabilitation Facilities [Member] | Texas [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 1,515 | |
Buildings, Improvements, and Lease Intangibles | 27,001 | |
Total real estate properties | 28,516 | |
Accumulated Depreciation | $ 82 | |
Long-Term Acute Care Hospitals [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 523 | |
Buildings, Improvements, and Lease Intangibles | 14,405 | |
Total real estate properties | 14,928 | |
Accumulated Depreciation | $ 1,222 | |
Long-Term Acute Care Hospitals [Member] | Indiana [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 1 | |
Land and Land Improvements | $ 523 | |
Buildings, Improvements, and Lease Intangibles | 14,405 | |
Total real estate properties | 14,928 | |
Accumulated Depreciation | $ 1,222 | |
Corporate property [Member] | ||
Real Estate Properties [Line Items] | ||
Number of Facilities | real_estate_property | 0 | |
Land and Land Improvements | $ 0 | |
Buildings, Improvements, and Lease Intangibles | 2,161 | |
Personal Property | 135 | |
Total real estate properties | 2,296 | |
Accumulated Depreciation | $ 309 |
Real Estate Leases (Details)
Real Estate Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Real Estate [Line Items] | |||
2019 (nine months ending December 31) | $ 32,823 | ||
2020 | 41,304 | ||
2021 | 38,200 | ||
2022 | 34,688 | ||
2023 | 30,177 | ||
2024 and thereafter | 156,754 | ||
Total | 333,946 | ||
Straight Line rent | 336 | $ 415 | |
Other Liabilities [Member] | |||
Real Estate [Line Items] | |||
Deferred revenue | $ 1,500 | $ 1,600 |
Real Estate Acquisitions (Detai
Real Estate Acquisitions (Details) ft² in Thousands, $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($)ft²real_estate_property | |
Business Acquisition [Line Items] | |
Area of real estate property (in square feet) | ft² | 2,300 |
Acquisition Of Two Properties During 1st Quarter 2019 [Member] | |
Business Acquisition [Line Items] | |
Number of properties acquired | real_estate_property | 2 |
Area of real estate property (in square feet) | ft² | 83 |
Consideration transferred | $ 32.7 |
Percentage of properties that were leased at acquisition | 100.00% |
Revenue from properties acquired | $ 0.4 |
Net income from properties acquired | 0.2 |
Transaction costs | $ 0.1 |
Mortgage and Other Notes Rece_2
Mortgage and Other Notes Receivable (Details) $ in Thousands | Apr. 25, 2018USD ($)hospital | Dec. 28, 2017USD ($)real_estate_property | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($)mortgage_note_receivable |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Mortgage note receivable, net | $ 10,600 | |||||
Notes receivable | $ 24,119 | $ 24,110 | ||||
Proceeds from the repayment of notes receivable | 31 | $ 17 | ||||
Repayments of mortgage note payable | $ 6,700 | 27 | 0 | |||
Real estate property | $ 417,874 | 389,632 | ||||
Mortgage Receivable [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of mortgage note receivables | mortgage_note_receivable | 1 | |||||
Promissory Notes, Secured by Accounts Receivable [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Mortgage loans on real estate, face amount of mortgages | $ 11,450 | |||||
Notes receivable | 8,750 | |||||
Receivable with imputed interest, discount | 2,700 | |||||
Promissory Notes, Secured By Facilities Owned By Borrower [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | 23,000 | $ 2,200 | ||||
Notes Receivable [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 900 | |||||
Proceeds from the repayment of notes receivable | $ 10,950 | |||||
Proceeds from the repayment of notes receivable, interest | 260 | |||||
Proceeds from the repayment of notes receivable, fees and expenses | $ 250 | |||||
Other Assets [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Interest receivable | $ 600 | |||||
Long-Term Acute Care Facility [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of properties used to secure notes by borrower | hospital | 7 | |||||
Inpatient Rehabilitation Hospital [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of properties used to secure notes by borrower | hospital | 1 | |||||
Specialty Hospital [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Number of properties used to secure notes by borrower | real_estate_property | 2 | |||||
Property Previously Financed By Mortgage Receivable [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Real estate property | $ 4,500 |
Debt, net - Schedule of Debt (D
Debt, net - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Debt, net | $ 179,117 | $ 147,766 |
Term Loan [Member] | Third Amended And Restated Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt, net | 175,000 | |
Mortgage Note Payable [Member] | ||
Debt Instrument [Line Items] | ||
Debt, net | 5,263 | 5,285 |
Revolving Credit Facility [Member] | Line of Credit [Member] | Third Amended And Restated Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt, net | 0 | 43,000 |
A-1 Term Loan [Member] | Term Loan [Member] | Third Amended And Restated Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt, net | 49,778 | 49,759 |
A-2 Term Loan [Member] | Term Loan [Member] | Third Amended And Restated Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt, net | 49,735 | 49,722 |
A-3 Term Loan [Member] | Term Loan [Member] | Third Amended And Restated Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt, net | $ 74,341 | $ 0 |
Debt, net - Narrative (Details)
Debt, net - Narrative (Details) | Mar. 29, 2019USD ($)option | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2018USD ($) |
Line of Credit Facility [Line Items] | ||||
Debt issuance costs | $ 1,323,000 | $ 218,000 | ||
Amount outstanding | 179,117,000 | $ 147,766,000 | ||
Third Amended And Restated Credit Facility [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Debt issuance costs | $ 1,300,000 | |||
Third Amended And Restated Credit Facility [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Face amount | $ 175,000,000 | |||
Unused borrowing commitment fee percentage | 0.35% | |||
Amount outstanding | $ 175,000,000 | |||
Weighted average interest rate percentage | 4.569% | |||
Third Amended And Restated Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 1.25% | |||
Third Amended And Restated Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 2.30% | |||
Third Amended And Restated Credit Facility [Member] | Base Rate [Member] | Minimum [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 0.25% | |||
Third Amended And Restated Credit Facility [Member] | Base Rate [Member] | Maximum [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 1.30% | |||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Debt issuance costs | $ 700,000 | |||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility [Member] | Line of Credit [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 150,000,000 | |||
Number of options to extend | option | 1 | |||
Length of extension | 12 months | |||
Remaining borrowing capacity | $ 150,000,000 | |||
Amount outstanding | $ 0 | 43,000,000 | ||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | Line of Credit [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 1.25% | |||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | Line of Credit [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 1.90% | |||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility [Member] | Base Rate [Member] | Minimum [Member] | Line of Credit [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 0.25% | |||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility [Member] | Base Rate [Member] | Maximum [Member] | Line of Credit [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Variable rate percentage | 0.90% | |||
Third Amended And Restated Credit Facility [Member] | Credit Facility, Accordion Feature [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 525,000,000 | |||
Third Amended And Restated Credit Facility [Member] | A-1 Term Loan [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Face amount | $ 50,000,000 | |||
Debt term | 5 years | |||
Amount outstanding | 49,778,000 | 49,759,000 | ||
Third Amended And Restated Credit Facility [Member] | A-2 Term Loan [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Face amount | $ 50,000,000 | |||
Debt term | 7 years | |||
Amount outstanding | 49,735,000 | 49,722,000 | ||
Third Amended And Restated Credit Facility [Member] | A-3 Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Debt issuance costs | $ 600,000 | |||
Third Amended And Restated Credit Facility [Member] | A-3 Term Loan [Member] | Term Loan [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Face amount | $ 75,000,000 | |||
Debt term | 7 years | |||
Amount outstanding | $ 74,341,000 | $ 0 | ||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility, Unused Borrowing Capacity Rate 1 [Member] | Line of Credit [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Unused borrowing commitment fee percentage | 0.25% | |||
Percentage of borrowing capacity outstanding | 33.30% | |||
Third Amended And Restated Credit Facility [Member] | Revolving Credit Facility, Unused Borrowing Capacity Rate 2 [Member] | Line of Credit [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Unused borrowing commitment fee percentage | 0.35% | |||
Percentage of borrowing capacity outstanding | 33.30% |
Derivative Financial Instrume_3
Derivative Financial Instruments - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($)derivative_instrument | |
Derivative [Line Items] | |
Cash flow hedges reclassified to interest expense | $ 0.2 |
Cash Flow Hedging [Member] | Interest Rate Contract [Member] | |
Derivative [Line Items] | |
Number outstanding interest rate derivatives | derivative_instrument | 7 |
Notional amount | $ 175 |
Termination value | 0.7 |
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Interest Rate Swap [Member] | |
Derivative [Line Items] | |
Interest rate swap liability | $ 0.7 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Fair Value Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Derivatives, Fair Value [Line Items] | ||
Derivative asset | $ 215 | $ 902 |
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability | 700 | |
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Other Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 215 | 902 |
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Other Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability | $ 857 | $ 98 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Cash Flow Hedging (Details) - Interest Rate Contract [Member] - Cash Flow Hedging [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of unrealized (loss) gain recognized in OCI on derivative | $ (1,213) | $ 906 |
Interest expense | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of (gain) loss reclassified from accumulated OCI into interest expense | (62) | 68 |
Total Interest Expense presented in the Condensed Consolidated Statements of Income in which the effects of the cash flow hedges are recorded | $ 2,054 | $ 1,268 |
Stockholders' Equity - Reconcil
Stockholders' Equity - Reconciliation of Common Stock (Details) - shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance, beginning of period (in shares) | 18,634,502 | 18,085,798 |
Issuance of common stock (in shares) | 143,600 | 334,700 |
Restricted stock-based awards (in shares) | 84,690 | 214,004 |
Balance, end of period (in shares) | 18,862,792 | 18,634,502 |
Stockholders' Equity - Equity O
Stockholders' Equity - Equity Offering (Details) - USD ($) | Aug. 07, 2018 | Mar. 31, 2019 | Dec. 31, 2018 |
Subsidiary, Sale of Stock [Line Items] | |||
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
At The Market Offering Program [Member] | Common Stock [Member] | |||
Subsidiary, Sale of Stock [Line Items] | |||
Common Stock, par value (in dollars per share) | $ 0.01 | ||
Value of shares authorized | $ 100,000,000 | ||
Shares issued in transaction (shares) | 143,600 | ||
Proceeds from sale of stock | $ 4,700,000 | ||
Sales price (in dollars per share) | $ 33.57 | ||
Remaining availability under ATM program | $ 84,800,000 |
Net Income Per Common Share (De
Net Income Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Earnings Per Share [Abstract] | ||
Net income | $ 1,450 | $ 1,872 |
Participating securities' share in earnings | (324) | (241) |
Net income, less participating securities' share in earnings | $ 1,126 | $ 1,631 |
Weighted average Common Shares outstanding | ||
Weighted average Common Shares outstanding (in shares) | 18,735,673 | 18,164,132 |
Unvested restricted shares (in shares) | (781,003) | (590,449) |
Weighted average Common Shares outstanding–Basic (in shares) | 17,954,670 | 17,573,683 |
Dilutive effect of restricted stock (in shares) | 0 | 0 |
Weighted average Common Shares outstanding –Diluted (in shares) | 17,954,670 | 17,573,683 |
Basic Net Income per Common Share (in dollars per share) | $ 0.06 | $ 0.09 |
Diluted Net Income per Common Share (in dollars per share) | $ 0.06 | $ 0.09 |
Incentive Plan - Narrative (Det
Incentive Plan - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
2014 Incentive Plan [Member] | Restricted Common Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation expense | $ 0.9 | $ 0.6 |
Incentive Plan - Restricted Sto
Incentive Plan - Restricted Stock Activity (Details) - 2014 Incentive Plan [Member] - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Restricted Common Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Stock-based awards, beginning of period (in shares) | 709,487 | 512,115 |
Granted (in shares) | 84,690 | 94,001 |
Vested shares (in shares) | 0 | 0 |
Stock-based awards, end of period (in shares) | 794,177 | 606,116 |
Restricted Common Stock, Stock in Lieu of Compensation [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Granted (in shares) | 42,525 | 47,027 |
Restricted Common Stock, Stock Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Granted (in shares) | 42,165 | 46,974 |
Other Assets - Other Assets (De
Other Assets - Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Operating Lease, Right-of-Use Asset | $ 141 | $ 0 |
Notes receivable | 24,119 | 24,110 |
Accounts and interest receivables | 2,092 | 2,158 |
Straight-line rent receivables | 3,593 | 3,254 |
Prepaid assets | 515 | 487 |
Deferred financing costs, net | 848 | 318 |
Leasing commissions, net | 862 | 790 |
Deferred tax asset | 2,008 | 2,024 |
Fair value of interest rate swaps | 215 | 902 |
Above-market intangible assets, net | 162 | 168 |
Other | 267 | 335 |
Other assets, net | $ 34,822 | $ 34,546 |
Other Assets - Narrative (Detai
Other Assets - Narrative (Details) $ in Thousands | Apr. 25, 2018USD ($)hospital | Mar. 31, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Mar. 31, 2018USD ($) |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Notes receivable | $ 24,119 | $ 24,119 | $ 24,110 | ||
Professional fees | $ 100 | ||||
Notes Receivable [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Notes receivable | $ 900 | ||||
Note receivable interest rate | 9.00% | ||||
Promissory Notes, Secured By Facilities Owned By Borrower [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Notes receivable | $ 23,000 | $ 2,200 | |||
Note receivable interest rate | 9.00% | ||||
Long-Term Acute Care Facility [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Number of properties used to secure notes by borrower | hospital | 7 | ||||
Inpatient Rehabilitation Hospital [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Number of properties used to secure notes by borrower | hospital | 1 | ||||
Hospitals [Member] | Notes Receivable [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Proceeds from payments | $ 300 |
Other Assets - VIEs (Details)
Other Assets - VIEs (Details) - Notes Receivable [Member] $ in Millions | Mar. 31, 2019USD ($) |
Variable Interest Entity One [Member] | |
Variable Interest Entity [Line Items] | |
Carrying Amount | $ 0.9 |
Maximum Exposure to Loss | 0.9 |
Variable Interest Entity Two [Member] | |
Variable Interest Entity [Line Items] | |
Carrying Amount | 23 |
Maximum Exposure to Loss | $ 23 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Mortgage note receivable | $ 10,600 | ||
Notes receivable | $ 24,119 | $ 24,110 | |
Interest rate swap asset | 215 | 902 | |
Carrying Value [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Notes receivable | 24,119 | 24,110 | |
Mortgage note payable | 5,365 | 5,391 | |
Carrying Value [Member] | Interest Rate Swap [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate swap asset | 215 | 902 | |
Interest rate swap liability | 857 | 269 | |
Fair Value [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Notes receivable | 23,948 | 23,936 | |
Mortgage note payable | 5,277 | 5,307 | |
Fair Value [Member] | Interest Rate Swap [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate swap asset | 215 | 902 | |
Interest rate swap liability | $ 857 | $ 269 |
Subsequent Events (Details)
Subsequent Events (Details) $ / shares in Units, ft² in Thousands, $ in Millions | May 01, 2019$ / shares | Apr. 30, 2019USD ($)ft²real_estate_property | Mar. 31, 2019ft² |
Subsequent Event [Line Items] | |||
Area of real estate property (in square feet) | ft² | 2,300 | ||
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Dividend declared (in dollars per share) | $ / shares | $ 0.41 | ||
Number of properties acquired | real_estate_property | 1 | ||
Area of real estate property (in square feet) | ft² | 81 | ||
Consideration transferred | $ | $ 27 | ||
Percentage of properties that were leased at acquisition | 100.00% | ||
Revolving Credit Facility [Member] | Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Draw on credit facility | $ | $ 23 |