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WELLTOWER INC. - Annual Report: 2017 (Form 10-K)

 

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

 

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2017

Commission File No. 1-8923

 

 

 

WELLTOWER INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware

 

34-1096634

 

 

 

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

4500 Dorr Street, Toledo, Ohio

 

43615

 

 

 

(Address of principal executive offices)

 

(Zip Code)

(419) 247-2800

(Registrant’s telephone number, including area code)  

 

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Name of Each Exchange on Which Registered

Common Stock, $1.00 par value

New York Stock Exchange

6.50% Series I Cumulative

Convertible Perpetual Preferred Stock, $1.00 par value

New York Stock Exchange

4.800% Notes due 2028

New York Stock Exchange

4.500% Notes due 2034

New York Stock Exchange

 

Securities registered pursuant to Section 12(g) of the Act:  None

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes    No 

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.  Yes    No  ☑ 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes    No 

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes    No 

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. 

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer                Accelerated filer                Non-accelerated filer                Smaller reporting company                Emerging growth company    

           (Do not check if a smaller reporting company)            

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes    No  ☑ 

 

The aggregate market value of the shares of voting common stock held by non-affiliates of the registrant, computed by reference to the closing sales price of such shares on the New York Stock Exchange as of the last business day of the registrant’s most recently completed second fiscal quarter was $27,562,002,967.

 

As of January 31, 2018, the registrant had 371,669,527 shares of common stock outstanding.

 

DOCUMENTS INCORPORATED BY REFERENCE

 

Portions of the registrant’s definitive proxy statement for the annual stockholders’ meeting to be held May 3, 2018, are incorporated by reference into Part III.

 


 

WELLTOWER INC.

2017 FORM 10-K ANNUAL REPORT

TABLE OF CONTENTS

 

 

 

Page

 

PART I

 

 

 

Item 1.

Business

2

Item 1A.

Risk Factors

13

Item 1B.

Unresolved Staff Comments

22

Item 2.

Properties

23

Item 3.

Item 4.

Legal Proceedings

Mine Safety Disclosures

25

25

 

 

 

 

PART II

 

 

 

Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 

25

Item 6.

Selected Financial Data

27

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

28

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

51

Item 8.

Financial Statements and Supplementary Data

52

Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

87

Item 9A.

Controls and Procedures

87

Item 9B.

Other Information

88

 

 

 

 

PART III

 

 

 

Item 10.

Directors, Executive Officers and Corporate Governance

89

Item 11.

Executive Compensation

89

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

89

Item 13.

Certain Relationships and Related Transactions and Director Independence

89

Item 14.

Principal Accounting Fees and Services

89

 

 

 

 

PART IV

 

 

 

Item 15.

Exhibits and Financial Statement Schedules

90

Item 16.

Form 10-K Summary

95

 

 

Signature

96

 

 

 

 

 

 

 

 


 

PART I

 

Item 1.  Business 

 

General

 

Welltower Inc. (NYSE:WELL), an S&P 500 company headquartered in Toledo, Ohio, is driving the transformation of health care infrastructure.  The company invests with leading seniors housing operators, post-acute providers and health systems to fund real estate and infrastructure needed to scale innovative care delivery models and improve people’s wellness and overall health care experience.  WelltowerTM, a real estate investment trust (“REIT”), owns interests in properties concentrated in major, high-growth markets in the United States (“U.S.”), Canada and the United Kingdom (“U.K.”), consisting of seniors housing and post-acute communities and outpatient medical properties.  Our capital programs, when combined with comprehensive planning, development and property management services, make us a single-source solution for acquiring, planning, developing, managing, repositioning and monetizing real estate assets.  More information is available on the Internet at www.welltower.com.  The information on our website is not incorporated by reference in this Annual Report on Form 10-K, and our web address is included as an inactive textual reference only.

 

Our primary objectives are to protect stockholder capital and enhance stockholder value. We seek to pay consistent cash dividends to stockholders and create opportunities to increase dividend payments to stockholders as a result of annual increases in net operating income and portfolio growth. To meet these objectives, we invest across the full spectrum of seniors housing and health care real estate and diversify our investment portfolio by property type, relationship and geographic location.

 

References herein to “we,” “us,” “our” or the “Company” refer to Welltower Inc., a Delaware corporation, and its subsidiaries unless specifically noted otherwise.

 

Portfolio of Properties

 

Please see “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operation – Executive Summary – Company Overview” for a table that summarizes our portfolio as of December 31, 2017.

 

Property Types

 

We invest in seniors housing and health care real estate and evaluate our business on three reportable segments: triple-net, seniors housing operating and outpatient medical. For additional information regarding our segments, please see Note 17 to our consolidated financial statements.  The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 2 to our consolidated financial statements.  The following is a summary of our various property types.

 

Triple-Net

 

Our triple-net properties include independent living facilities and independent supportive living facilities (Canada), continuing care retirement communities, assisted living facilities, care homes with and without nursing (U.K.), Alzheimer’s/dementia care facilities and long-term/post-acute care facilities.  We invest primarily through acquisitions, development and joint venture partnerships. Our properties are primarily leased to operators under long-term, triple-net master leases that obligate the tenant to pay all operating costs, utilities, real estate taxes, insurance, building repairs, maintenance costs and all obligations under certain ground leases. We are not involved in property management.  Our properties include stand-alone facilities that provide one level of service, combination facilities that provide multiple levels of service, and communities or campuses that provide a wide range of services.

 

Independent Living Facilities and Independent Supportive Living Facilities (Canada).  Independent living facilities and independent supportive living facilities are age-restricted, multifamily properties with central dining facilities that provide residents access to meals and other services such as housekeeping, linen service, transportation and social and recreational activities.

 

Continuing Care Retirement Communities.  Continuing care retirement communities typically include a combination of detached homes, an independent living facility, an assisted living facility and/or a long-term/post-acute care facility on one campus. These communities appeal to residents because there is no need to relocate when health and medical needs change. Resident payment plans vary, but can include entrance fees, condominium fees and rental fees. Many of these communities also charge monthly maintenance fees in exchange for a living unit, meals and some health services.

 

Assisted Living Facilities.  Assisted living facilities are state regulated rental properties that provide the same services as independent living facilities, but also provide supportive care from trained employees to residents who require assistance with activities of daily living, including, but not limited to, management of medications, bathing, dressing, toileting, ambulating and eating.

 

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Care Homes with or without Nursing (U.K.).  Care homes without nursing, regulated by the Care Quality Commission (CQC”), are rental properties that provide essentially the same services as U.S. assisted living facilities. Care homes with nursing, also regulated by the CQC, are licensed daily rate or rental properties where the majority of individuals require 24-hour nursing and/or medical care. Generally, these properties are licensed for various national and local reimbursement programs.  Unlike the U.S., care homes with nursing in the U.K. generally do not provide post-acute care.

 

Alzheimer’s/Dementia Care Facilities.  Certain assisted living facilities may include state-licensed settings that specialize in caring for those afflicted with Alzheimer’s disease and/or other types of dementia.

 

Long-Term/Post-Acute Care Facilities.  Our long-term/post-acute care facilities generally include skilled nursing/post-acute care facilities, inpatient rehabilitation facilities and long-term acute care facilities.  Skilled nursing/post-acute care facilities are licensed daily rate or rental properties where the majority of individuals require 24-hour nursing and/or medical care. Generally, these properties are licensed for Medicaid and/or Medicare reimbursement in the U.S. or provincial reimbursement in Canada.  All facilities offer some level of rehabilitation services.  Some facilities focus on higher acuity patients and offer rehabilitation units specializing in cardiac, orthopedic, dialysis, neurological or pulmonary rehabilitation.  Inpatient rehabilitation facilities provide inpatient services for patients with intensive rehabilitation needs.  Long-term acute care facilities provide inpatient services for patients with complex medical conditions that require more intensive care, monitoring or emergency support than is available in most skilled nursing/post-acute care facilities. 

 

     Our triple-net segment accounted for 22%, 28% and 31% of total revenues for the years ended December 31, 2017, 2016 and 2015, respectively.  For the year ended December 31, 2017, our revenues related to our relationship with Genesis HealthCare (“Genesis”) accounted for approximately 20% of our triple-net segment revenues and 4% of our total revenues. As of December 31, 2017, our relationship with Genesis was comprised of a master lease for 86 properties owned 100% by us, three real estate loans totaling approximately $267 million, approximately 9.5 million shares of GEN Series A common stock (representing approximately 6% of total GEN common stock) and a 25% ownership stake in an unconsolidated joint venture that includes a master lease for 28 properties operated by Genesis. In addition to rent, the master lease requires Genesis to pay all operating costs, utilities, real estate taxes, insurance, building repairs, maintenance costs and all obligations under certain ground leases.  All obligations under the master lease have been guaranteed by FC-GEN Operations Investment, LLC, a subsidiary of Genesis. Please see Notes 6 and 21 to our consolidated financial statements for additional information.

 

Seniors Housing Operating

 

Our seniors housing operating properties include several of the facility types described in “Item 1 – Business – Property Types – Triple-Net”, including independent living facilities and independent supportive living facilities, assisted living facilities, care homes and Alzheimer’s/dementia care facilities.  Properties are primarily held in joint venture entities with operating partners. We utilize the structure proposed in the REIT Investment Diversification and Empowerment Act of 2007, which is commonly referred to as a “RIDEA” structure (the provisions of the Internal Revenue Code authorizing the RIDEA structure were enacted as part of the Housing and Economic Recovery Act of 2008).  See Note 18 to our consolidated financial statements for more information.

 

     Our seniors housing operating segment accounted for 65%, 59% and 56% of total revenues for the years ended December 31, 2017, 2016 and 2015, respectively.  As of December 31, 2017, we had relationships with 17 operators to manage our seniors housing operating properties.  In each instance, our partner provides management services to the properties pursuant to an incentive-based management contract.  We rely on our partners to effectively and efficiently manage these properties.  For the year ended December 31, 2017, our relationship with Sunrise Senior Living accounted for approximately 37% of our seniors housing operating segment revenues and 24% of our total revenues. See Note 7 to our consolidated financial statements for additional information.

 

Outpatient Medical

 

Outpatient Medical Buildings.  The outpatient medical building portfolio consists of health care related buildings that generally include physician offices, ambulatory surgery centers, diagnostic facilities, outpatient services and/or labs. Our portfolio has a strong affiliation with health systems. Approximately 95% of our outpatient medical building portfolio is affiliated with health systems (with buildings on hospital campuses or serving as satellite locations for the health system and its physicians). We typically lease our outpatient medical buildings to multiple tenants and provide varying levels of property management.  Our outpatient medical segment accounted for 13% of total revenues for each of the years ended December 31, 2017, 2016 and 2015.  No single tenant exceeds 20% of segment revenues.

 

Investments

 

We invest in seniors housing and health care real estate primarily through acquisitions, developments and joint venture partnerships. For additional information regarding acquisition and development activity, please see Note 3 to our consolidated financial statements.  We seek to diversify our investment portfolio by property type, relationship and geographic location. In determining whether to invest in a property, we focus on the following: (1) the experience of the obligor’s/partner’s management

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team; (2) the historical and projected financial and operational performance of the property; (3) the credit of the obligor/partner; (4) the security for any lease or loan; (5) the real estate attributes of the building and its location; (6) the capital committed to the property by the obligor/partner; and (7) the operating fundamentals of the applicable industry.

 

We monitor our investments through a variety of methods determined by the type of property. Our asset management process for seniors housing properties generally includes review of monthly financial statements and other operating data for each property, review of obligor/partner creditworthiness, property inspections, and review of covenant compliance relating to licensure, real estate taxes, letters of credit and other collateral. Our internal property management division manages and monitors the outpatient medical portfolio with a comprehensive process including review of, among other things, tenant relations, lease expirations, the mix of health service providers, hospital/health system relationships, property performance, capital improvement needs, and market conditions.

 

Investment Types

 

Real Property.  Our properties are primarily comprised of land, buildings, improvements and related rights.  Our triple-net properties are generally leased to operators under long-term operating leases.  The leases generally have a fixed contractual term of 12 to 15 years and contain one or more five to 15-year renewal options. Certain of our leases also contain purchase options, a portion of which could result in the disposition of properties for less than full market value.  Most of our rents are received under triple-net leases requiring the operator to pay rent and all additional charges incurred in the operation of the leased property. The tenants are required to repair, rebuild and maintain the leased properties. Substantially all of these operating leases are designed with escalating rent structures. Leases with fixed annual rental escalators are generally recognized on a straight-line basis over the initial lease period, subject to a collectability assessment. Rental income related to leases with contingent rental escalators is generally recorded based on the contractual cash rental payments due for the period.

 

At December 31, 2017, approximately 92% of our triple-net properties were subject to master leases. A master lease is a lease of multiple properties to one tenant entity under a single lease agreement. From time to time, we may acquire additional properties that are then leased to the tenant under the master lease. The tenant is required to make one monthly payment that represents rent on all the properties that are subject to the master lease. Typically, the master lease tenant can exercise its right to purchase the properties or to renew the master lease only with respect to all leased properties at the same time. This bundling feature benefits us because the tenant cannot limit the purchase or renewal to the better performing properties and terminate the leasing arrangement with respect to the poorer performing properties. This spreads our risk among the entire group of properties within the master lease. The bundling feature should provide a similar advantage to us if the master lease tenant is in bankruptcy. Subject to certain restrictions, a debtor in bankruptcy has the right to assume or reject its unexpired leases and executory contracts.  In the context of integrated master leases such as ours, our tenants in bankruptcy would be required to assume or reject the master lease as a whole, rather than deciding on a property by property basis.

 

Our outpatient medical portfolio is primarily self-managed and consists principally of multi-tenant properties leased to health care providers. Our leases typically include increasers and some form of operating expense reimbursement by the tenant. As of December 31, 2017, 80% of our portfolio included leases with full pass through, 19% with a partial expense reimbursement (modified gross) and 1% with no expense reimbursement (gross). Our outpatient medical leases are non-cancellable operating leases that have a weighted-average remaining term of seven years at December 31, 2017 and are often credit enhanced by security deposits, guaranties and/or letters of credit.   

 

Construction.  We provide for the construction of properties for tenants primarily as part of long-term operating leases. We capitalize certain interest costs associated with funds used for the construction of properties owned by us. The amount capitalized is based upon the amount advanced during the construction period using the rate of interest that approximates our Company-wide cost of financing. Our interest expense is reduced by the amount capitalized. We also typically charge a transaction fee at the commencement of construction which we defer and amortize to income over the term of the resulting lease. The construction period commences upon funding and terminates upon the earlier of the completion of the applicable property or the end of a specified period. During the construction period, we advance funds to the tenants in accordance with agreed upon terms and conditions which require, among other things, periodic site visits by a Company representative. During the construction period, we generally require an additional credit enhancement in the form of payment and performance bonds and/or completion guaranties. At December 31, 2017, we had outstanding construction investments of $237,746,000 and were committed to provide additional funds of approximately $429,815,000 to complete construction for investment properties. See Note 3 to our consolidated financial statements for additional information. We also provide for construction loans which, depending on the terms and conditions, could be treated as loans, real property, or investments in unconsolidated entities.

 

Real Estate Loans.  Our real estate loans are typically structured to provide us with interest income, principal amortization and transaction fees and are generally secured by first/second mortgage liens, leasehold mortgages, corporate guaranties and/or personal guaranties. At December 31, 2017, we had gross outstanding real estate loans of $495,871,000.  The interest yield averaged approximately 9.2% per annum on our outstanding real estate loan balances. Our yield on real estate loans depends upon a number of factors, including the stated interest rate, average principal amount outstanding during the term of the loan and any interest rate adjustments. The real estate loans outstanding at December 31, 2017 are generally subject to one to 15-year terms with principal amortization schedules and/or balloon payments of the outstanding principal balances at the end of the term. Typically, real estate loans are cross-defaulted and cross-collateralized with other real estate loans, operating leases or agreements between us and the obligor and its affiliates. See Note 6 to our consolidated financial statements for additional information.

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     Investments in Unconsolidated Entities. Investments in entities that we do not consolidate but have the ability to exercise significant influence over operating and financial policies are reported under the equity method of accounting.  Our investments in unconsolidated entities generally represent interests ranging from 10% to 50% in real estate assets.  Under the equity method of accounting, our share of the investee’s earnings or losses is included in our consolidated results of operations. To the extent that our cost basis is different from the basis reflected at the entity level, the basis difference is generally amortized over the lives of the related assets and liabilities, and such amortization is included in our share of equity in earnings of the entity.  The initial carrying value of investments in unconsolidated entities is based on the amount paid to purchase the entity interest or the estimated fair value of the assets prior to the sale of interests in the entity. We evaluate our equity method investments for impairment based upon a comparison of the estimated fair value of the equity method investment to its carrying value. When we determine a decline in the estimated fair value of such an investment below its carrying value is other-than-temporary, an impairment is recorded.  See Note 7 to our consolidated financial statements for more information.

 

Principles of Consolidation

     The consolidated financial statements are in conformity with U.S general accepted accounting principles (“U.S. GAAP”) and include the accounts of our wholly-owned subsidiaries and joint venture entities that we control, through voting rights or other means. All material intercompany transactions and balances have been eliminated in consolidation.

     At inception of joint venture transactions, we identify entities for which control is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and determine which business enterprise is the primary beneficiary of its operations. A VIE is broadly defined as an entity where either (i) the equity investors as a group, if any, do not have a controlling financial interest, or (ii) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support. We consolidate investments in VIEs when we are determined to be the primary beneficiary.  Accounting Standards Codification Topic 810, Consolidations, requires enterprises to perform a qualitative approach to determining whether or not a VIE will need to be consolidated. This evaluation is based on an enterprise’s ability to direct and influence the activities of a VIE that most significantly impact that entity’s economic performance.

     For investments in joint ventures, U.S. GAAP may preclude consolidation by the sole general partner in certain circumstances based on the type of rights held by the limited partner(s).  We assess the limited partners’ rights and their impact on our consolidation conclusions, and we reassess if there is a change to the terms or in the exercisability of the rights of the limited partners, the sole general partner increases or decreases its ownership of limited partnership interests, or there is an increase or decrease in the number of outstanding limited partnership interests. We similarly evaluate the rights of managing members of limited liability companies.

  

 

Borrowing Policies

 

We utilize a combination of debt and equity to fund investments. Our debt and equity levels are determined by management to maintain a conservative balance sheet and credit profile. Generally, we intend to issue unsecured, fixed-rate public debt with long-term maturities to approximate the maturities on our triple-net leases and investment strategy. For short-term purposes, we may borrow on our primary unsecured credit facility. We replace these borrowings with long-term capital such as senior unsecured notes or common stock. When terms are deemed favorable, we may invest in properties subject to existing mortgage indebtedness. In addition, we may obtain secured financing for unleveraged properties in which we have invested or may refinance properties acquired on a leveraged basis. In certain agreements with our lenders, we are subject to restrictions with respect to secured and unsecured indebtedness.

 

Competition

 

We compete with other real estate investment trusts, real estate partnerships, private equity and hedge fund investors, banks, insurance companies, finance/investment companies, government-sponsored agencies, taxable and tax-exempt bond funds, health care operators, developers and other investors in the acquisition, development, leasing and financing of health care and seniors housing properties. We compete for investments based on a number of factors including relationships, certainty of execution, investment structures and underwriting criteria. Our ability to successfully compete is impacted by economic and demographic trends, availability of acceptable investment opportunities, our ability to negotiate beneficial investment terms, availability and cost of capital, construction and renovation costs, and applicable laws and regulations.

 

The operators/tenants of our properties compete with properties that provide comparable services in the local markets. Operators/tenants compete for patients and residents based on a number of factors including quality of care, reputation, physical appearance of properties, location, services offered, family preferences, physicians, staff, and price. We also face competition from other health care facilities for tenants, such as physicians and other health care providers that provide comparable facilities and services.

 

For additional information on the risks associated with our business, please see “Item 1A — Risk Factors” of this Annual Report on Form 10-K.

 

Employees  As of January 31, 2018, we had 392 employees.

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Credit Concentrations  Please see Note 8 to our consolidated financial statements.

 

Geographic Concentrations  Please see “Item 2 – Properties” below and Note 17 to our consolidated financial statements.

  

Health Care Industry

 

     The demand for health care services, and consequently health care properties, is projected to reach unprecedented levels in the near future. The Centers for Medicare and Medicaid Services (“CMS”) projects that national health expenditures will rise to approximately $3.7 trillion in 2018 or 18.5% of gross domestic product. The average annual growth in national health expenditures for 2015 through 2025 is expected to be 5.8%. While demographics are the primary driver of demand, economic conditions and availability of services contribute to health care service utilization rates. We believe the health care property market may be less susceptible to fluctuations and economic downturns relative to other property sectors. Investor interest in the market remains strong, especially in specific sectors such as private-pay seniors housing and outpatient medical buildings. The total U.S. population for 2015 through 2025 is projected to increase by 9.3%. The elderly population aged 65 and over is projected to increase by 36% through 2025. The elderly are an important component of health care utilization, especially independent living services, assisted living services, long-term/post-acute care services, inpatient and outpatient hospital services and physician ambulatory care. Most health care services are provided within a health care facility such as a hospital, a physician’s office or a seniors housing community. Therefore, we believe there will be continued demand for companies, such as ours, with expertise in health care real estate.

 

     Health care real estate investment opportunities tend to increase as demand for health care services increases.  We recognize the need for health care real estate as it correlates to health care service demand.  Health care providers require real estate to house their businesses and expand their services.  We believe that investment opportunities in health care real estate will continue to be present due to:

·         The specialized nature of the industry, which enhances the credibility and experience of the Company;

·         The projected population growth combined with stable or increasing health care utilization rates, which ensures demand; and

·         The on-going merger and acquisition activity.

 

Certain Government Regulations

 

United States

 

Health Law Matters — Generally

 

     Typically, operators of seniors housing facilities do not receive significant funding from government programs and are largely subject to state laws, as opposed to federal laws.  Operators of long-term/post-acute care facilities and hospitals do receive significant funding from government programs, and these facilities are subject to extensive regulation, including federal and state laws covering the type and quality of medical and/or nursing care provided, ancillary services (e.g., respiratory, occupational, physical and infusion therapies), qualifications of the administrative personnel and nursing staff, the adequacy of the physical plant and equipment, reimbursement and rate setting and operating policies.  In addition, as described below, operators of these facilities are subject to extensive laws and regulations pertaining to health care fraud and abuse, including, but not limited to, the federal Anti-Kickback Statute (“AKS”), the federal Stark Law (“Stark Law”), and the federal False Claims Act (“FCA”), as well as comparable state laws.  Hospitals, physician group practice clinics, and other health care providers that operate in our portfolio are subject to extensive federal, state, and local licensure, registration, certification, and inspection laws, regulations, and industry standards.  Our tenants’ failure to comply with applicable laws and regulations could result in, among other things: loss of accreditation; denial of reimbursement; imposition of fines; suspension, decertification, or exclusion from federal and state health care programs; loss of license; or closure of the facility.  See risk factors “The requirements of, or changes to, governmental reimbursement programs, such as Medicare or Medicaid, could have a material adverse effect on our obligors’ liquidity, financial condition and results of operations, which could adversely affect our obligors’ ability to meet their obligations to us” and “Our operators’ or tenants’ failure to comply with federal, state, local, and industry-regulated licensure, certification and inspection laws, regulations, and standards could adversely affect such operators’ or tenants’ operations, which could adversely affect our operators’ and tenants’ ability to meet their obligations to us” in “Item 1A – Risk Factors” below.

 

Licensing and Certification

     

     The primary regulations that affect long-term and post-acute care facilities are state licensing and registration laws.  For example, certain health care facilities are subject to a variety of licensure and certificate of need (“CON”) laws and regulations.  Where applicable, CON laws generally require, among other requirements, that a facility demonstrate the need for (1) constructing a new facility, (2) adding beds or expanding an existing facility, (3) investing in major capital equipment or adding new services, (4) changing the ownership or control of an existing licensed facility, or (5) terminating services that have been previously approved through the CON process.  Certain state CON laws and regulations may restrict the ability of operators to add new properties or

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expand an existing facility’s size or services. In addition, CON laws may constrain the ability of an operator to transfer responsibility for operating a particular facility to a new operator.

 

     With respect to licensure, generally our long-term/post-acute care facilities are required to be licensed and certified for participation in Medicare, Medicaid, and other federal and state health care programs.  The failure of our operators to maintain or renew any required license or regulatory approval as well as the failure of our operators to correct serious deficiencies identified in a compliance survey could require those operators to discontinue operations at a property.  In addition, if a property is found to be out of compliance with Medicare, Medicaid, or other federal or state health care program conditions of participation, the property operator may be excluded from participating in those government health care programs. 

 

Reimbursement

 

     The reimbursement methodologies applied to health care facilities continue to evolve.  Federal and state authorities have considered and may seek to implement new or modified reimbursement methodologies, including value-based reimbursement methodologies that may negatively impact health care property operations.  The impact of any such changes, if implemented, may result in a material adverse effect on our portfolio.  No assurance can be given that current revenue sources or levels will be maintained.  Accordingly, there can be no assurance that payments under a government health care program are currently, or will be in the future, sufficient to fully reimburse the property operators for their operating and capital expenses.

·         Seniors Housing Facilities.  Approximately 60% of our overall revenues for the year ended December 31, 2017 were attributable to U.S. seniors housing facilities.  The majority of the revenues received by the operators of these facilities are from private pay sources. The remaining revenue source is primarily Medicaid provided under state waiver programs for home and community based care.  As of September 30, 2017, 14 of our 43 seniors housing operators received Medicaid reimbursement pursuant to Medicaid waiver programs. For the twelve months ended September 30, 2017, approximately 1.2% of the revenues at our seniors housing facilities were from Medicaid reimbursement.  There can be no guarantee that a state Medicaid program operating pursuant to a waiver will be able to maintain its waiver status.  Rates paid by self-pay residents are set by the facilities and are determined by local market conditions and operating costs.  Generally, facilities receive a higher payment per day for a private pay resident than for a Medicaid beneficiary who requires a comparable level of care.  The level of Medicaid reimbursement varies from state to state.  Thus, the revenues generated by operators of our assisted living facilities may be adversely affected by payor mix, acuity level, changes in Medicaid eligibility, and reimbursement levels.  In addition, a state could lose its Medicaid waiver and no longer be permitted to utilize Medicaid dollars to reimburse for assisted living services.

·         Long-Term/Post-Acute Care Facilities.  Approximately 8% of our overall revenues for the year ended December 31, 2017 were attributable to U.S. long-term/post-acute care facilities.  The majority of the revenues received by the operators of these facilities are from the Medicare and Medicaid programs, with the balance representing reimbursement payments from private payors.  Consequently, changes in federal or state reimbursement policies may adversely affect an operator’s ability to cover its expenses, including our rent or debt service.  Long-term/post-acute care facilities are subject to periodic pre- and post-payment reviews, and other audits by federal and state authorities.  A review or audit of a property operator’s claims could result in recoupments, denials, or delay of payments in the future.  Due to the significant judgments and estimates inherent in payor settlement accounting, no assurance can be given as to the adequacy of any reserves maintained by our property operators to cover potential adjustments to reimbursements, or to cover settlements made to payors. Recent focus on billing practices, payments, and quality of care, or ongoing government pressure to reduce spending by government health care programs, could result in lower payments to long-term/post-acute care facilities and, as a result, may impair an operator’s ability to meet its financial obligations to us.

    Medicare Reimbursement.  For the twelve months ended September 30, 2017, approximately 35% of the revenues at our long-term/post-acute care facilities were paid by Medicare. Generally, long-term/post-acute care facilities are reimbursed under the Medicare Skilled Nursing Facility Prospective Payment System (“SNF PPS”), the Inpatient Rehabilitation Facility Prospective Payment System (“IRF PPS”), or the Long-Term Care Hospital Prospective Payment System (“LTCH PPS”), which generally provide reimbursement based upon a predetermined fixed amount per episode of care and are updated by CMS, an agency of the Department of Health and Human Services (“HHS”) annually.  In August 2017, CMS made some positive payment updates for fiscal year (“FY”) 2017 under the SNF PPS, the IRF PPS and the LTCH PPS.  In particular, CMS published a final rule regarding FY 2018 Medicare payment policies and rates for:

§  SNF PPS.  Under the final SNF PPS rule, CMS projects that payments to SNFs will increase in FY 2018 on an aggregate basis by 1.0% from payments in FY 2017. 

§  IRF PPS.  Under the IRF PPS rule, CMS estimates that aggregate payments to IRFs will increase in FY 2018 on an aggregate basis by 0.9% relative to payments in FY 2017.

§  LTCH PPS.  As a result of the continuation of the phase-in of site neutral payment rates for specified cases in LTCHs, CMS projects FY 2018 Medicare payments to LTCHs will decrease by 2.4%.  Payment rates will increase by 1.0% for cases that qualify for the higher standard LTCH PPS rate.  CMS also finalized its proposal to remove from FY 2018 payment rates the temporary 0.6% Medicare Part A hospital payment increase to FY 2017 payment rates implemented in connection with a federal district court’s review of the “Two Midnight” payment policy.

There is a risk under these payment systems that costs will exceed the fixed payments, or that payments may be set below the costs to provide certain items and services.  In addition, the HHS Office of Inspector General has released recommendations to address SNF billing practices and Medicare payment rates.  If followed, these recommendations regarding SNF payment reform may impact our tenants and operators.

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    Medicaid Reimbursement.  For the twelve months ended September 30, 2017, approximately 36% of the revenues of our long-term/post-acute care facilities were paid by Medicaid.  Many states reimburse SNFs, for example, using fixed daily rates, which are applied prospectively based on patient acuity and the historical costs incurred in providing patient care.  In most states, Medicaid does not fully reimburse the cost of providing services.  Certain states are attempting to slow the rate of Medicaid growth by freezing rates or restricting eligibility and benefits.  In addition, Medicaid reimbursement rates may decline if state revenues in a particular state are not sufficient to fund budgeted expenditures. 

·         Medicare Reimbursement for Physicians, Hospital Outpatient Departments (“HOPDs”), and Ambulatory Surgical Centers (“ASCs”).  Changes in reimbursement to physicians, HOPDs, and ASCs may further affect our tenants and operators.  Generally, Medicare reimburses physicians under the Physician Fee Schedule, while HOPDs and ASCs are reimbursed under prospective payment systems.  The Physician Fee Schedule and the HOPD and ASC prospective payment systems are updated annually by CMS.  These annual Medicare payment regulations have resulted in lower net pay increases than providers of those services have often expected.  In addition, the Medicare and Children’s Health Insurance Program Reauthorization Act of 2015 (“MACRA”) includes payment reductions for providers who do not meet government quality standards.  The implementation of pay-for-quality models like those required under MACRA is expected to produce funding disparities that could adversely impact some provider tenants in outpatient medical buildings and other health care properties.  Changes in Medicare Advantage plan payments may also indirectly affect our operators and tenants that contract with Medicare Advantage plans.

·         Health Reform Laws.  The Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively, the “Health Reform Laws”) dramatically altered how health care is delivered and reimbursed in the U.S. and contained various provisions, including Medicaid expansion and the establishment of Health Insurance Exchanges (“HIEs”) providing subsidized health insurance, that may directly impact us or the operators and tenants of our properties.  Since taking office, President Trump and the current U.S. Congress have sought to modify, repeal, or otherwise invalidate all or portions of the Health Reform Laws. For example, in October 2017, President Trump issued an executive order in which he stated that it is his Administration’s policy to seek the prompt repeal of the Health Reform Laws and directed executive departments and federal agencies to waive, defer, grant exemptions from, or delay the implementation of the provisions of the Health Reform Laws to the maximum extent permitted by law.  On the same day, the federal government separately announced that cost-sharing reduction payments to insurers offering qualified health plans through the HIEs would end, effective immediately, unless Congress appropriated the funds. Further, in December 2017, the U.S. Congress passed the Tax Cuts and Jobs Act, which included a provision that eliminates the penalty under the Health Reform Laws’ individual mandate and could impact the future state of the HIEs established by the Health Reform Laws.  There is still uncertainty with respect to the additional impact President Trump’s Administration and the U.S. Congress may have, if any, and any changes will likely take time to unfold, and could have an impact on coverage and reimbursement for health care items and services covered by plans that were authorized by the Health Reform Laws.  We cannot predict whether the existing Health Reform Laws, or future health care reform legislation or regulatory changes, will have a material impact on our operators’ or tenants’ property or business. 

 

     Fraud & Abuse Enforcement

 

     Long-term/post-acute care facilities (and seniors housing facilities that receive Medicaid payments) are subject to federal, state, and local laws, regulations, and applicable guidance that govern the operations and financial and other arrangements that may be entered into by health care providers.  Certain of these laws, such as the AKS and Stark Law, prohibit direct or indirect payments of any kind for the purpose of inducing or encouraging the referral of patients for medical products or services reimbursable by government health care programs.  Other laws require providers to furnish only medically necessary services and submit to the government valid and accurate statements for each service.  Specifically, our operators and tenants that receive payments from federal healthcare programs, such as Medicare and Medicaid, are subject to substantial financial penalties under the Civil Monetary Penalties Act and the FCA and, in particular, actions under the FCA’s “whistleblower” provisions.  Private enforcement of health care fraud has increased due in large part to amendments to the FCA that encourage private individuals to sue on behalf of the government. In addition, states may also have separate false claims acts, which, among other things, generally prohibit health care providers from filing false claims or making false statements to receive payments.  Still other laws require providers to comply with a variety of safety, health and other requirements relating to the condition of the licensed property and the quality of care provided.  Sanctions for violations of these laws, regulations, and other applicable guidance may include, but are not limited to, criminal and/or civil penalties and fines, loss of licensure, immediate termination of government payments, exclusion from any government health care program, damage assessments, and imprisonment.  In certain circumstances, violation of these rules (such as those prohibiting abusive and fraudulent behavior) with respect to one property may subject other facilities under common control or ownership to sanctions, including exclusion from participation in the Medicare and Medicaid programs, as well as other government health care programs.  In the ordinary course of its business, a property operator is regularly subjected to inquiries, investigations, and audits by the federal and state agencies that oversee these laws and regulations.

 

     Prosecutions, investigations, or whistleblower actions could have a material adverse effect on a property operator’s liquidity, financial condition, and operations, which could adversely affect the ability of the operator to meet its financial obligations to us.  In addition, government investigations and enforcement actions brought against the health care industry have increased dramatically over the past several years and are expected to continue.  Although the responsibility for enforcing these laws and regulations lies with a variety of federal, state and local governmental agencies, some may be enforced by private litigants through federal and state false claims acts and other laws, including some state privacy laws, that allow for private individuals to bring actions.  The costs for an

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operator of a health care property associated with both defending such enforcement actions and the undertakings in settling these actions can be substantial and could have a material adverse effect on the ability of an operator to meet its obligations to us.

 

Federal and State Data Privacy and Security Laws

 

    The Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), as amended by the Health Information Technology for Economic and Clinical Health Act, and numerous other state and federal laws govern the collection, security, dissemination, use, access to and confidentiality of individually identifiable health information.  Violations of these laws may result in substantial civil and/or criminal fines and penalties.  The costs for an operator of a health care property associated with developing and maintaining HIPAA compliance systems, defending enforcement actions and paying any assessed fines, can be substantial and could have a material adverse effect on the ability of an operator to meet its obligations to us.

 

United Kingdom

 

     In the U.K., care home services are principally regulated by the Health and Social Care Act 2008 (as amended) and other regulations.  This legislation subjects service providers to a number of legally binding “Fundamental Standards” and requires, amongst other things, that all persons carrying out “Regulated Activities” in the U.K., and the managers of such persons, be registered. Providers of care home services are also subject (as data controllers) to laws governing their use of personal data (including in relation to their employees, clients and recipients of their services).  These laws currently take the form of the U.K.’s Data Protection Act 1998, enforced by the U.K.’s Information Commissioner’s Office, but are expected to be replaced by the European Union’s (“EU”) new General Data Protection Regulation (“GDPR”).  The GDPR will impose a significant number of new obligations with the potential for fines of up to 4% of annual worldwide turnover or €20 million, whichever is greater.  Entities incorporated in or carrying on a business in the U.K. as well as individuals residing in the U.K. are also subject to the U.K. Bribery Act 2010.  The U.K. recently introduced a new national minimum wage with a maximum fine for non-payment of £20,000 per worker and employers who fail to pay will be banned from being a company director for up to 15 years.  The U.K. recently voted to exit from the EU (“Brexit”).  Negotiations on the exit agreement are underway but at present it is not possible to predict whether Brexit will have a material impact on our operators’ or tenants’ property or business.

 

Canada

 

     Retirement homes and long-term care homes are subject to regulation, and long-term care homes receive funding, under provincial law.  There is no federal regulation in this area.  Set out below are summaries of the principal regulatory requirements in the provinces where we have a material number of facilities.

 

     Licensing and Regulation

 

     Alberta

 

     In Alberta, there are three relevant designations for seniors’ living arrangements, ordered below from the most independent to the highest level of care.

·         Retirement Homes (also called independent living) are designed for older adults able to live on their own, and may offer various lifestyle amenities.  These residences may be rented, privately owned, or life-leased, and may be operated for profit or non-profit.  Support services are not usually offered, but can be arranged by residents.  Retirement homes do not generally receive government funding; residents pay for tenancy and services received.  Rental subsidies may be available to qualified seniors. Independent living residences are subject to provincial tenancy and housing laws.

·         Supportive Living (also called assisted living) provides home-like accommodation for residents who wish or need to access care, assistance, and services. Operators provide at least one meal a day and/or housekeeping services.  There are four levels of supportive living, addressing care needs from basic to advanced.  In addition, there are two specialized designations of supportive care to address the needs of residents who require the highest level of care including for those who have cognitive impairments. Supportive living can include senior lodges, group homes, and mental health and designated supportive living accommodations, which can be operated by private for-profit or not-for-profit, or public operators.  Supportive living services are licensed and regulated under provincial laws, and governed by the Ministry of Health.  Operators receiving public funds for health and personal care services must also comply with additional provincial legislation, and are subject to legislated safeguards aimed at investigation of suspected abuse. The maximum accommodation fee in publicly-funded designated supportive living is regulated by Alberta Health. In other supportive living settings, the operator sets the cost of accommodation. Health services are publicly-funded and provided through Alberta Health Services.  Private sector operators are eligible to apply for government funding under a government capital grant program that provides funding to develop long-term care and affordable supportive living spaces.

·         Nursing Homes (also called long-term care) are for residents who have complex, unpredictable medical needs and who require 24-hour on-site registered nurse assessment or treatment. Nursing homes are regulated by provincial laws, and governed by the Ministry of Health.  Operators are not licensed, but enter into agreements with the Ministry for the operation of nursing homes and must comply with certain accommodation standards.  Homes can be operated by private for-profit or

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not-for-profit, or public operators. Operators that receive public funds for health and personal care services must also comply with certain health service standards and legislation aimed at protecting residents.  Alberta Health regulates the maximum accommodation fee in publicly-funded nursing homes.  Health services in long-term care are publicly-funded, provided through Alberta Health Services.  Private sector operators are eligible to apply for government funding, and the Minister may make grants to an operator in respect of its operating or capital costs.

 

Ontario

 

     Retirement homes are regulated and licensed under a provincial law aimed at protecting residents. Retirement homes do not receive government funding; residents enter into tenancy agreements under provincial tenancy law, and pay for tenancy and services received.  Residents may access publicly-funded external care services at the home from external suppliers.  Retirement home licenses are granted by the Retirement Homes Regulatory Authority (“RHRA”), and are non-transferable. The RHRA administers the law governing retirement homes, to ensure that licensees are meeting certain standards, generally with respect to care and safety.  The law requires any person to report to the RHRA when there are reasonable grounds to suspect abuse of a resident by anyone, or neglect of a resident by staff.  The RHRA conducts a mandatory inspection and issues a report that is posted on the RHRA’s public website, and also must be posted in the subject home if it is the most recent report.  The Registrar of the RHRA can receive complaints about a retirement home contravening a provision of the law, and if such a complaint is received, it must be reviewed promptly.  The Registrar has broad powers relating to complaint investigation and action.  The RHRA Registrar has the power to inspect a retirement home at any time without warning or issue a warrant to ensure compliance.  Compliance inspections occur at least every three years. The Registrar has the power to make a variety of orders including the imposition of a fine or an order revoking the operator’s license.  The applicable law also enumerates offenses, such as operating without a license, and provides for penalties for offenses.

 

     British Columbia

 

     Provincial laws regulate and license “community care facilities” (long-term care homes) in substantially the same manner as retirement homes are regulated under Ontario laws. Community care facilities are defined as premises used for the purpose of supervising vulnerable persons who require three or more prescribed services (from a list that includes regular assistance with activities of daily living; distribution of medication; management of cash resources; monitoring of food intake; structured behavior management and intervention; and psychosocial or physical rehabilitative therapy).

 

     Provincial law also recognizes and regulates “assisted living residences,” for seniors who can live independently, but require assistance with certain activities. Services available can include meals, housekeeping, monitoring and emergency support, social/recreational opportunities, and transportation.  Assisted living residences do not require a license, but must be registered with the registrar of assisted living residences and must be operated in a manner that does not jeopardize the health or safety of residents. If the registrar believes the standard is not being met, the registrar may inspect the residence and may suspend or cancel a registration.  Independent living residences offer housing and hospitality services for retired adults who are functionally independent and able to direct their own care.

 

Québec

 

     Provincial laws in Québec regulate retirement homes (private seniors’ residences) as well as long-term care homes (residential and long-term care centers). Private seniors’ residences are required to obtain a certificate of compliance based on prescribed operating standards.  A certificate of compliance is issued for a period of four years and is renewable. The regional health and social agency may revoke or refuse to issue or renew a certificate of compliance if, among other things, the operator fails to comply with the applicable law. The agency may also order corrective measures, further to an inspection, complaint or investigation. The agency is authorized to inspect a residence, at any reasonable time of day, in order to ascertain whether it complies with the law.

 

     Private seniors’ residences may belong to either or both of the following categories: (i) those offering services to independent elderly persons and (ii) those offering services to semi-independent elderly persons. The operator must, for each category, comply with the applicable criteria and standards, with some exceptions for residences with fewer than six or ten rooms or apartments. There are requirements with respect to residents’ health and safety, meal services and recreation, content of residents’ files, disclosure of information to residents, and staffing, among other things.

 

     In May 2017, Quebec adopted the Act to combat maltreatment of seniors and other persons of full age in vulnerable situations, which aims to implement a Quebec-wide framework agreement to combat maltreatment, targets all facilities that provide health services and social services to seniors and vulnerable persons, including health establishments and private residences.  We expect that it will affect private seniors’ residences in the following ways:

·         Health establishments are required to adopt an “Anti-Maltreatment Policy”, providing notably for the measures put in place to prevent maltreatment of persons in vulnerable situations;

·         The policy adopted by health establishments will notably have to include the required adaptation for the implementation of the policy in private sector residences; and

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·         Operators of private seniors’ residences will be required to apply the policy adopted by the integrated health and social services center in their territory, as well as ensure that the policy is known by residents, their family members and their employees.

 

  Other Related Laws

 

     Privacy

 

     The services provided in our facilities are subject to privacy legislation in Canada, including, in certain provinces, privacy laws specifically related to personal health information.  Although the obligations of custodians of personal information in the various provinces differ, they all include the obligation to protect the information.  The organizations with which we have management agreements may be the custodian of personal information collected in connection with the operation of our facilities.

 

     Privacy laws in Canada are consent-based and require the implementation of a privacy program involving policies, procedures and the designation of an individual or team with primary responsibility for privacy law compliance.  Mandatory breach notification to affected individuals is a requirement under some laws.  Mandatory breach notification to the applicable regulator is a requirement in some provinces.  Some laws require notification where personal information is processed or stored outside of Canada.  One provincial law (in Quebec) provides for fines where an organization fails to perform due diligence before outsourcing activities involving personal information to a service provider outside of the province.

 

     The powers of privacy regulators and penalties for violations of privacy law vary according to the applicable law or are left to the courts.  To date, monetary penalties granted have been on the low side, although that is changing with civil actions for breach of privacy and may change further as a result of class action activity.  There are over 60 privacy class actions which have been filed in Canada over recent years although none have yet been decided on their merits.  Regulators have the authority to make public the identity of a custodian that has been found to have committed a breach, so there is a reputational risk associated with privacy law violations even where no monetary damages are incurred. The notification of residents (mandatory under some privacy laws) and other activities required to manage a privacy breach can give rise to significant costs.

 

     Other Legislation

 

     Retirement homes may be subject to residential tenancy laws, such that there can be restrictions on rent increases and termination of tenancies, for instance.  Other provincial and/or municipal laws applicable to fire safety, food services, zoning, occupational health and safety, public health, and the provision of community health care and funded long-term/post-acute care may also apply to retirement homes. 

  

Taxation

 

     U.S. Federal Income Tax Considerations

 

     General

 

     We elected to be taxed as a REIT commencing with our first taxable year. We intend to continue to operate in such a manner as to qualify as a REIT, but there is no guarantee that we will qualify or remain qualified as a REIT for subsequent years. Qualification and taxation as a REIT depends upon our ability to meet a variety of complex qualification tests imposed under federal income tax law with respect to income, assets, distribution level and diversity of share ownership. There can be no assurance that we will be owned and organized and will operate in a manner so as to qualify or remain qualified.

 

     Failure to Qualify as a REIT

 

     If we fail to qualify for taxation as a REIT in any taxable year, we will be subject to federal income tax on our taxable income at regular corporate rates. Distributions to stockholders in any year in which we fail to qualify as a REIT will not be deductible nor will any particular amount of distributions be required to be made in any year. All distributions to stockholders will be taxable as ordinary income to the extent of current and accumulated earnings and profits allocable to these distributions and, subject to certain limitations, will be eligible for the dividends received deduction for corporate stockholders. Unless entitled to relief under specific statutory provisions, we also will be disqualified from taxation as a REIT for the four taxable years following the year during which qualification was lost. It is not possible to state whether in all circumstances we would be entitled to statutory relief. Failure to qualify for even one year could result in our need to incur indebtedness or liquidate investments in order to pay potentially significant resulting tax liabilities.

 

     The Tax Cuts and Jobs Act (“Tax Act”)

 

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     The Tax Act made significant changes to the U.S. federal income tax laws applicable to businesses and their owners, including REITs and their shareholders.  Congressional leaders have recognized that the process of adopting extensive tax legislation in a short amount of time without hearings and substantial time for review may have led to drafting errors, issues needing clarification and unintended consequences that may need to be addressed subsequent tax legislation.  It is unknown when Congress may address these issues or when the Internal Revenue Service (“IRS”) may issue guidance regarding the interpretation and implementation of the Tax Act.  We cannot predict what impact future legislation and guidance will have on us or our shareholders.

 

Internet Access to Our SEC Filings

 

Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports, as well as our proxy statements and other materials that are filed with, or furnished to, the Securities and Exchange Commission (“SEC”) are made available, free of charge, on the Internet at www.welltower.com, as soon as reasonably practicable after they are filed with, or furnished to, the SEC. We routinely post important information on our website at www.welltower.com in the “Investors” section, including corporate and investor presentations and financial information.  We intend to use our website as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included on our website under the heading “Investors.”  Accordingly, investors should monitor such portion of our website in addition to following our press releases, public conference calls, and filings with the Securities and Exchange Commission.  The information on our website is not incorporated by reference in this Annual Report on Form 10-K, and our web address is included as an inactive textual reference only.

 

Cautionary Statement Regarding Forward-Looking Statements

 

     This Annual Report on Form 10-K and the documents incorporated by reference contain statements that constitute “forward-looking statements,” within the meaning of the Private Securities Litigation Reform Act of 1995. When we use words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate” or similar expressions that do not relate solely to historical matters, we are making forward-looking statements. In particular, these forward-looking statements include, but are not limited to, those relating to our opportunities to acquire, develop or sell properties; our ability to close our anticipated acquisitions, investments or dispositions on currently anticipated terms, or within currently anticipated timeframes; the expected performance of our operators/tenants and properties; our expected occupancy rates; our ability to declare and to make distributions to stockholders; our investment and financing opportunities and plans; our continued qualification as a REIT; and our ability to access capital markets or other sources of funds.

 

     Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause our actual results to differ materially from our expectations discussed in the forward-looking statements. This may be a result of various factors, including, but not limited to:

          the status of the economy;

          the status of capital markets, including availability and cost of capital;

          issues facing the health care industry, including compliance with, and changes to, regulations and payment policies, responding to government investigations and punitive settlements and operators’/tenants’ difficulty in cost-effectively obtaining and maintaining adequate liability and other insurance;

          changes in financing terms;

          competition within the health care and seniors housing industries;

          negative developments in the operating results or financial condition of operators/tenants, including, but not limited to, their ability to pay rent and repay loans;

          our ability to transition or sell properties with profitable results;

          the failure to make new investments or acquisitions as and when anticipated;

          natural disasters and other acts of God affecting our properties;

          our ability to re-lease space at similar rates as vacancies occur;

          our ability to timely reinvest sale proceeds at similar rates to assets sold;

          operator/tenant or joint venture partner bankruptcies or insolvencies;

          the cooperation of joint venture partners;

          government regulations affecting Medicare and Medicaid reimbursement rates and operational requirements;

          liability or contract claims by or against operators/tenants;

          unanticipated difficulties and/or expenditures relating to future investments or acquisitions;

          environmental laws affecting our properties;

          changes in rules or practices governing our financial reporting;

          the movement of U.S. and foreign currency exchange rates;

          our ability to maintain our qualification as a REIT;

          key management personnel recruitment and retention; and

          the risks described under “Item 1A — Risk Factors.”

 

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     We undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events, or otherwise.

 

Item 1A. Risk Factors

 

     This section discusses the most significant factors that affect our business, operations and financial condition. It does not describe all risks and uncertainties applicable to us, our industry or ownership of our securities. If any of the following risks, as well as other risks and uncertainties that are not addressed in this section or that we have not yet identified, actually occur, we could be materially adversely affected and the value of our securities could decline. We group these risk factors into three categories:

          Risks arising from our business;

          Risks arising from our capital structure; and

          Risks arising from our status as a REIT.

 

Risks Arising from Our Business

 

Our investments in and acquisitions of health care and seniors housing properties may be unsuccessful or fail to meet our expectations

 

     We are exposed to the risk that some of our acquisitions may not prove to be successful. We could encounter unanticipated difficulties and expenditures relating to any acquired properties, including contingent liabilities, and acquired properties might require significant management attention that would otherwise be devoted to our ongoing business. If we agree to provide construction funding to an operator/tenant and the project is not completed, we may need to take steps to ensure completion of the project. Such expenditures may negatively affect our results of operations. Investments in and acquisitions of seniors housing and health care properties entail risks associated with real estate investments generally, including risks that the investment will not achieve expected returns, that the cost estimates for necessary property improvements will prove inaccurate or that the tenant, operator or manager will fail to meet performance expectations.  Furthermore, there can be no assurance that our anticipated acquisitions and investments, the completion of which is subject to various conditions, will be consummated in accordance with anticipated timing, on anticipated terms, or at all.  Health care properties are often highly customizable and the development or redevelopment of such properties may require costly tenant-specific improvements.  We also may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of properties, into our existing operations, and this could have an adverse effect on our results of operations and financial condition.  As a result, we cannot assure you that we will achieve the economic benefit we expect from acquisitions, investment, development and redevelopment opportunities.  All of the foregoing could affect our ability to continue paying dividends at the current rate.

 

Our investments in joint ventures could be adversely affected by our lack of exclusive control over these investments, our partners’ insolvency or failure to meet their obligations, and disputes between us and our partners

 

     We have entered into, and may continue in the future to enter into, partnerships or joint ventures with other persons or entities. Joint venture investments involve risks that may not be present with other methods of ownership, including the possibility that our partner might become insolvent, refuse to make capital contributions when due or otherwise fail to meet its obligations, which may result in certain liabilities to us for guarantees and other commitments; that our partner might at any time have economic or other business interests or goals that are or become inconsistent with our interests or goals; that we could become engaged in a dispute with our partner, which could require us to expend additional resources to resolve such dispute and could have an adverse impact on the operations and profitability of the joint venture; and that our partner may be in a position to take action or withhold consent contrary to our instructions or requests. In addition, our ability to transfer our interest in a joint venture to a third party may be restricted. In some instances, we and/or our partner may have the right to trigger a buy-sell arrangement, which could cause us to sell our interest, or acquire our partner’s interest, at a time when we otherwise would not have initiated such a transaction. Our ability to acquire our partner’s interest may be limited if we do not have sufficient cash, available borrowing capacity or other capital resources. In such event, we may be forced to sell our interest in the joint venture when we would otherwise prefer to retain it. Joint ventures may require us to share decision-making authority with our partners, which could limit our ability to control the properties in the joint ventures. Even when we have a controlling interest, certain major decisions may require partner approval, such as the sale, acquisition or financing of a property.

 

We are exposed to operational risks with respect to our seniors housing operating properties that could adversely affect our revenue and operations

 

     We are exposed to various operational risks with respect to our seniors housing operating properties that may increase our costs or adversely affect our ability to generate revenues. These risks include fluctuations in occupancy, Medicare and Medicaid reimbursement, if applicable, and private pay rates; economic conditions; competition; federal, state, local, and industry-regulated licensure, certification and inspection laws, regulations, and standards; the availability and increases in cost of general and professional liability insurance coverage; state regulation and rights of residents related to entrance fees; and the availability and

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increases in the cost of labor (as a result of unionization or otherwise). Any one or a combination of these factors may adversely affect our revenue and operations.

 

Decreases in our operators’ revenues or increases in our operators’ expenses could affect our operators’ ability to make payments to us

 

     Our operators’ revenues are primarily driven by occupancy, private pay rates, and Medicare and Medicaid reimbursement, if applicable. Expenses for these facilities are primarily driven by the costs of labor, food, utilities, taxes, insurance and rent or debt service. Revenues from government reimbursement have, and may continue to, come under pressure due to reimbursement cuts and state budget shortfalls. Operating costs continue to increase for our operators. To the extent that any decrease in revenues and/or any increase in operating expenses result in a property not generating enough cash to make payments to us, the credit of our operator and the value of other collateral would have to be relied upon. To the extent the value of such property is reduced, we may need to record an impairment for such asset. Furthermore, if we determine to dispose of an underperforming property, such sale may result in a loss. Any such impairment or loss on sale would negatively affect our financial results.  All of the foregoing could affect our ability to continue paying dividends at the current rate.

 

Increased competition and oversupply may affect our operators’ ability to meet their obligations to us  

 

     The operators of our properties compete on a local and regional basis with operators of properties and other health care providers that provide comparable services for residents and patients, including on the basis of the scope and quality of care and services provided, reputation and financial condition, physical appearance of the properties, price, and location.  Our operators are expected to encounter increased competition in the future that could limit their ability to attract residents or expand their businesses.  In addition, we expect that there will continue to be a more than adequate inventory of seniors housing facilities.  We cannot be certain that the operators of all of our facilities will be able to achieve and maintain occupancy and rate levels that will enable them to meet all of their obligations to us.  If our operators cannot compete effectively or if there is an oversupply of facilities, their financial performance and ability to meet their obligations to us could have a material adverse effect on our financial results.

 

A severe cold and flu season, epidemics or any other widespread illnesses could adversely affect the occupancy of our seniors housing operating and triple-net properties

 

     Our and our operators’ revenues are dependent on occupancy.  It is impossible to predict the severity of the cold and flu season or the occurrence of epidemics or any other widespread illnesses.  The occupancy of our seniors housing operating and triple-net properties could significantly decrease in the event of a severe cold and flu season, an epidemic or any other widespread illness.  Such a decrease could affect the operating income of our seniors housing operating properties and the ability of our triple-net operators to make payments to us.  In addition, a flu pandemic could significantly increase the cost burdens faced by our operators, including if they are required to implement quarantines for residents, and adversely affect their ability to meet their obligations to us, which would have a material adverse effect on our financial results.

 

The insolvency or bankruptcy of our tenants, operators, borrowers, managers and other obligors may adversely affect our business, results of operations and financial condition

 

     We are exposed to the risk that our tenants, operators, borrowers, managers or other obligors may not be able to meet the rent, principal and interest or other payments due us, which may result in a tenant, operator, borrower, manager or other obligor bankruptcy or insolvency, or that a tenant, operator, borrower, manager or other obligor might become subject to bankruptcy or insolvency proceedings for other reasons. Although our operating lease agreements provide us with the right to evict a tenant, demand immediate payment of rent and exercise other remedies, and our loans provide us with the right to terminate any funding obligation, demand immediate repayment of principal and unpaid interest, foreclose on the collateral and exercise other remedies, the bankruptcy and insolvency laws afford certain rights to a party that has filed for bankruptcy or reorganization. A tenant, operator, borrower, manager or other obligor in bankruptcy or subject to insolvency proceedings may be able to limit or delay our ability to collect unpaid rent in the case of a lease or to receive unpaid principal and interest in the case of a loan, and to exercise other rights and remedies. In addition, if a lease is rejected in a tenant bankruptcy, our claim against the tenant may be limited by applicable provisions of the bankruptcy law.  We may be required to fund certain expenses (e.g., real estate taxes and maintenance) to preserve the value of an investment property, avoid the imposition of liens on a property and/or transition a property to a new tenant. In some instances, we have terminated our lease with a tenant and relet the property to another tenant. In some of those situations, we have provided working capital loans to and limited indemnification of the new obligor. If we cannot transition a leased property to a new tenant, we may take possession of that property, which may expose us to certain successor liabilities. Should such events occur, our revenue and operating cash flow may be adversely affected.  All of the foregoing could affect our ability to continue paying dividends at the current rate.

 

We may not be able to timely reinvest our sale proceeds on terms acceptable to us

 

     From time to time, we will have cash available from the proceeds of sales of our securities, principal payments on our loans receivable or the sale of properties, including non-elective dispositions, under the terms of master leases or similar financial support

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arrangements. In order to maintain current revenues and continue generating attractive returns, we expect to re-invest these proceeds in a timely manner. We compete for real estate investments with a broad variety of potential investors, including other health care REITs, real estate partnerships, health care providers, health care lenders and other investors, including developers, banks, insurance companies, pension funds, government-sponsored entities and private equity firms, some of whom may have greater financial resources and lower costs of capital than we do. This competition for attractive investments may negatively affect our ability to make timely investments on terms acceptable to us.

 

We depend on Genesis HealthCare (“Genesis”) and Brookdale Senior Living (“Brookdale”) for a significant portion of our revenues and any failure, inability or unwillingness by them to satisfy obligations under their agreements with us could adversely affect us

 

     The properties we lease to Genesis and Brookdale account for a significant portion of our revenues, and because our leases with Genesis and Brookdale are triple-net leases, we also depend on Genesis and Brookdale to pay all insurance, taxes, utilities and maintenance and repair expenses in connection with the leased properties. We cannot assure you that Genesis and Brookdale will have sufficient assets, income and access to financing to enable them to make rental payments to us or to otherwise satisfy their respective obligations under our leases, and any failure, inability or unwillingness by Genesis or Brookdale to do so could have an adverse effect on our business, results of operations and financial condition. Although the most recent publicly available financial statements of Genesis reflect going concern disclosures, the operator remains current on rent and the coverage remains above 1.0.  Genesis and Brookdale have also agreed to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities arising in connection with their respective businesses, and we cannot assure you that Genesis and Brookdale will have sufficient assets, income, access to financing and insurance coverage to enable them to satisfy their respective indemnification obligations.  Genesis’s and Brookdale’s failure to effectively conduct their operations or to maintain and improve our properties could adversely affect their business reputations and their ability to attract and retain patients and residents in our properties, which, in turn, could adversely affect our business, results of operations and financial condition. Additionally, we have made real estate and other loans to Genesis and their operational or other failures could adversely impact their ability to repay these loans when due.  See Note 21 to our consolidated financial statements for additional information regarding Genesis.

 

The properties managed by Sunrise Senior Living, LLC (“Sunrise”) account for a significant portion of our revenues and operating income and any adverse developments in its business or financial condition could adversely affect us

 

     As of December 31, 2017, Sunrise managed 158 of our seniors housing operating properties.  These properties account for a significant portion of our revenues, and we rely on Sunrise to manage these properties efficiently and effectively.  We also rely on Sunrise to set appropriate resident fees, to provide accurate property-level financial results for our properties in a timely manner and to otherwise operate them in compliance with the terms of our management agreements and all applicable laws and regulations.  Any adverse developments in Sunrise’s business or financial condition could impair its ability to manage our properties efficiently and effectively, which could adversely affect our business, results of operations, and financial condition.  Also, if Sunrise experiences any significant financial, legal, accounting or regulatory difficulties, such difficulties could result in, among other things, acceleration of its indebtedness, impairment of its continued access to capital or the commencement of insolvency proceedings by or against it under the U.S. Bankruptcy Code, which, in turn, could adversely affect our business, results of operations and financial condition. See Note 7 to our consolidated financial statements for additional information.

 

Ownership of property outside the U.S. may subject us to different or greater risks than those associated with our domestic operations

 

     We have operations in Canada and the U.K. International development, ownership, and operating activities involve risks that are different from those we face with respect to our domestic properties and operations. These risks include, but are not limited to, any international currency gain recognized with respect to changes in exchange rates may not qualify under the 75% gross income test or the 95% gross income test that we must satisfy annually in order to qualify and maintain our status as a REIT; challenges with respect to the repatriation of foreign earnings and cash; changes in foreign political, regulatory, and economic conditions (regionally, nationally and locally) including, but not limited to, the U.K.’s June 2016 vote to exit the EU; challenges in managing international operations; challenges of complying with a wide variety of foreign laws and regulations, including those relating to real estate, corporate governance, operations, taxes, employment and other civil and criminal legal proceedings; foreign ownership restrictions with respect to operations in countries; differences in lending practices and the willingness of domestic or foreign lenders to provide financing; regional or country-specific business cycles and political and economic instability; and failure to comply with applicable laws and regulations in the U.S. that affect foreign operations, including, but not limited to, the U.S. Foreign Corrupt Practices Act. If we are unable to successfully manage the risks associated with international expansion and operations, our results of operations and financial condition may be adversely affected.

 

If our tenants do not renew their existing leases, or if we are required to sell properties for liquidity reasons, we may be unable to lease or sell the properties on favorable terms, or at all

 

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     We cannot predict whether our tenants will renew existing leases at the end of their lease terms, which expire at various times. If these leases are not renewed, we would be required to find other tenants to occupy those properties or sell them. There can be no assurance that we would be able to identify suitable replacement tenants or enter into leases with new tenants on terms as favorable to us as the current leases or that we would be able to lease those properties at all.

 

     Real estate investments are relatively illiquid and most of the property we own is highly customized for specific uses. Our ability to quickly sell or exchange any of our properties in response to changes in operator, economic and other conditions will be limited. No assurances can be given that we will recognize full value for any property that we are required to sell. Our inability to respond rapidly to changes in the performance of our investments could adversely affect our financial condition and results of operations. In addition, we are exposed to the risks inherent in concentrating investments in real estate, and in particular, the seniors housing and health care industries. A downturn in the real estate industry could adversely affect the value of our properties and our ability to sell properties for a price or on terms acceptable to us.  All of the foregoing could affect our ability to continue paying dividends at the current rate.

 

Our tenants, operators and managers may not have the necessary insurance coverage to insure adequately against losses

 

     We maintain or require our tenants, operators and managers to maintain comprehensive insurance coverage on our properties and their operations with terms, conditions, limits and deductibles that we believe are customary for similarly-situated companies in our industry, and we frequently review our insurance programs and requirements.  That said, we cannot assure you that we or our tenants, operators or managers will continue to be able to maintain adequate levels of insurance and required coverages or that we will continue to require the same levels of insurance coverage under our lease, management and other agreements, which could adversely affect us in the event of a significant uninsured loss.  Also, in recent years, long-term/post-acute care and seniors housing operators and managers have experienced substantial increases in both the number and size of patient care liability claims. As a result, general and professional liability costs have increased in some markets. General and professional liability insurance coverage may be restricted or very costly, which may adversely affect the tenants’, operators’ and managers’ future operations, cash flows and financial condition, and may have a material adverse effect on the tenants’, operators’ and managers’ ability to meet their obligations to us. 

 

Our ownership of properties through ground leases exposes us to the loss of such properties upon breach or termination of the ground leases

 

     We have acquired an interest in certain of our properties by acquiring a leasehold interest in the property on which the building is located, and we may acquire additional properties in the future through the purchase of interests in ground leases. As the lessee under a ground lease, we are exposed to the possibility of losing the property upon termination of the ground lease or an earlier breach of the ground lease by us.

 

The requirements of, or changes to, governmental reimbursement programs, such as Medicare, Medicaid or government funding, could have a material adverse effect on our obligors’ liquidity, financial condition and results of operations, which could adversely affect our obligors’ ability to meet their obligations to us

 

     Some of our obligors’ businesses are affected by government reimbursement. To the extent that an operator/tenant receives a significant portion of its revenues from government payors, primarily Medicare and Medicaid, such revenues may be subject to statutory and regulatory changes, retroactive rate adjustments, recovery of program overpayments or set-offs, court decisions, administrative rulings, policy interpretations, payment or other delays by fiscal intermediaries or carriers, government funding restrictions (at a program level or with respect to specific facilities) and interruption or delays in payments due to any ongoing government investigations and audits at such property. In recent years, government payors have frozen or reduced payments to health care providers due to budgetary pressures. Health care reimbursement will likely continue to be of paramount importance to federal and state authorities. We cannot make any assessment as to the ultimate timing or effect any future legislative reforms may have on the financial condition of our obligors and properties. There can be no assurance that adequate reimbursement levels will be available for services provided by any property operator, whether the property receives reimbursement from Medicare, Medicaid or private payors. Significant limits on the scope of services reimbursed and on reimbursement rates and fees could have a material adverse effect on an obligor’s liquidity, financial condition and results of operations, which could adversely affect the ability of an obligor to meet its obligations to us.

 

     The Health Reform Laws, provide those states that expand their Medicaid coverage to otherwise eligible state residents with incomes at or below 138% of the federal poverty level with an increased federal medical assistance percentage, effective January 1, 2014, when certain conditions are met. Given that the federal government substantially funds the Medicaid expansion, it is unclear how many states will ultimately pursue this option, although, as of early February 2018, more than 60% of the states have expanded Medicaid coverage. The participation by states in the Medicaid expansion could have the dual effect of increasing our tenants’ revenues, through new patients, but further straining state budgets and their ability to pay our tenants. We expect that the current Presidential Administration and U.S. Congress will seek to modify, repeal, or otherwise invalidate all, or certain provisions of, the Health Reform Laws, including Medicaid expansion. Since taking office, President Trump has continued to support the repeal of all or portions of the Health Reform Laws.  See “Item 1 — Business — Certain Government Regulations — United States — Reimbursement” above for additional information. If the operations, cash flows or financial condition of our operators and tenants are

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materially adversely impacted by the Health Reform Laws or future legislation, our revenue and operations may be adversely affected as well. More generally, and because of the dynamic nature of the legislative and regulatory environment for health care products and services, and in light of existing federal deficit and budgetary concerns, we cannot predict the impact that broad-based, far-reaching legislative or regulatory changes could have on the U.S. economy, our business, or that of our operators and tenants.

 

Our operators’ or tenants’ failure to comply with federal, state, province, local, and industry-regulated licensure, certification and inspection laws, regulations, and standards could adversely affect such operators’ or tenants’ operations, which could adversely affect our operators’ and tenants’ ability to meet their obligations to us

 

     Our operators and tenants generally are subject to varying levels of federal, state, local, and industry-regulated licensure, certification and inspection laws, regulations, and standards. Our operators’ or tenants’ failure to comply with any of these laws, regulations, or standards could result in loss of accreditation, denial of reimbursement, imposition of fines, suspension, decertification or exclusion from federal and state health care programs, loss of license or closure of the facility. Such actions may have an effect on our operators’ or tenants’ ability to make lease payments to us and, therefore, adversely impact us. See “Item 1 — Business — Certain Government Regulations — United States — Fraud & Abuse Enforcement” above.

 

     Many of our properties may require a license, registration, and/or CON to operate. Failure to obtain a license, registration, or CON, or loss of a required license, registration, or CON would prevent a facility from operating in the manner intended by the operators or tenants. These events could materially adversely affect our operators’ or tenants’ ability to make rent or other obligatory payments to us. State and local laws also may regulate the expansion, including the addition of new beds or services or acquisition of medical equipment, and the construction or renovation of health care facilities, by requiring a CON or other similar approval from a state agency. See “Item 1 — Business — Certain Government Regulations — United States — Licensing and Certification” above.

 

The real estate market and our business may be negatively impacted by changes to U.S. tax laws

 

     The Tax Act adopted on December 22, 2017 significantly changes the U.S. income tax rules for individuals and corporations.  We are continuing to evaluate the impact of the Tax Act and, as such, its implications for our business remain uncertain.  Although the Tax Act involves comprehensive changes to the system of corporate income tax, it does not substantively change the manner in which REITs are taxed.  Although numerous provisions of the Tax Act do affect REITs, we are generally not subject to pay federal taxes applicable to regular corporations if we comply with the tax regulations governing REIT status.  Nonetheless, the Tax Act makes numerous changes to the individual income tax rules that may affect the real estate market in the U.S., including limitations on the deductibility of state and local property taxes, the elimination of the deductibility of interest on new home equity loans and a reduction in the limit for an individual’s mortgage interest expense to interest on $750,000 of mortgages.  Although the impact of these changes is likely to be most significant in the residential real estate market, rather than in the sectors where we operate, the effects of these changes on the broader real estate market in the geographic areas in which we operate and on our tenants remain uncertain.

 

Changes in applicable tax regulations could negatively affect our financial results

 

     We are subject to taxation in the U.S. and numerous foreign jurisdictions.  Because, even with the passage of the Tax Act, the U.S. maintains a worldwide corporate tax system, the foreign and U.S. tax systems are somewhat interdependent.  Longstanding international norms that determine each country’s jurisdiction to tax cross-border international trade are evolving, such as the Base Erosion and Profit Shifting project (“BEPS”) currently being undertaken by the G8, G20 and Organization for Economic Cooperation and Development.  Tax changes pursuant to BEPS could reduce the ability of our foreign subsidiaries to deduct for foreign tax purposes the interest they pay on loans from us, thereby, increasing the foreign tax liability of the subsidiaries; it is also possible that foreign countries could increase their withholding taxes on dividends and interest.  Given the unpredictability of these possible changes and their potential interdependency, it is very difficult to assess the overall effect of such potential tax changes on our earnings and cash flow, but such changes could adversely impact our financial results.

 

Unfavorable resolution of pending and future litigation matters and disputes could have a material adverse effect on our financial condition

 

     From time to time, we may be directly involved in a number of legal proceedings, lawsuits and other claims. We may also be named as defendants in lawsuits allegedly arising out of our actions or the actions of our operators/tenants or managers in which such operators/tenants or managers have agreed to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities arising in connection with their respective businesses. An unfavorable resolution of pending or future litigation or legal proceedings may have a material adverse effect on our business, results of operations and financial condition. Regardless of its outcome, litigation may result in substantial costs and expenses and significantly divert the attention of management. There can be no assurance that we will be able to prevail in, or achieve a favorable settlement of, pending or future litigation. In addition, pending litigation or future litigation, government proceedings or environmental matters could lead to increased costs or interruption of our normal business operations.

 

Development, redevelopment and construction risks could affect our profitability

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     At any given time, we may be in the process of constructing one or more new facilities that ultimately will require a CON and license before they can be utilized by the operator for their intended use. The operator also may need to obtain Medicare and Medicaid certification and enter into Medicare and Medicaid provider agreements and/or third party payor contracts. In the event that the operator is unable to obtain the necessary CON, licensure, certification, provider agreements or contracts after the completion of construction, there is a risk that we will not be able to earn any revenues on the facility until either the initial operator obtains a license or certification to operate the new facility and the necessary provider agreements or contracts or we find and contract with a new operator that is able to obtain a license to operate the facility for its intended use and the necessary provider agreements or contracts.

 

     In connection with our renovation, redevelopment, development and related construction activities, we may be unable to obtain, or suffer delays in obtaining, necessary zoning, land-use, building, occupancy and other required governmental permits and authorizations. These factors could result in increased costs or our abandonment of these projects. In addition, we may not be able to obtain financing on favorable terms, which may render us unable to proceed with our development activities, and we may not be able to complete construction and lease-up of a property on schedule, which could result in increased debt service expense or construction costs. Additionally, the time frame required for development, construction and lease-up of these properties means that we may have to wait years for significant cash returns. Because we are required to make cash distributions to our stockholders, if the cash flow from operations or refinancing is not sufficient, we may be forced to borrow additional money to fund such distributions. Newly developed and acquired properties may not produce the cash flow that we expect, which could adversely affect our overall financial performance.

 

     In deciding whether to acquire or develop a particular property, we make assumptions regarding the expected future performance of that property. In particular, we estimate the return on our investment based on expected occupancy, rental rates and capital costs. If our financial projections with respect to a new property are inaccurate as a result of increases in capital costs or other factors, the property may fail to perform as we expected in analyzing our investment. Our estimate of the costs of repositioning or redeveloping an acquired property may prove to be inaccurate, which may result in our failure to meet our profitability goals. Additionally, we may acquire new properties that are not fully leased, and the cash flow from existing operations may be insufficient to pay the operating expenses and debt service associated with that property.

 

We may experience losses caused by severe weather conditions or natural disasters, which could result in an increase of our or our tenants’ cost of insurance, a decrease in our anticipated revenues or a significant loss of the capital we have invested in a property

 

     We maintain or require our tenants to maintain comprehensive insurance coverage on our properties with terms, conditions, limits and deductibles that we believe are appropriate given the relative risk and costs of such coverage, and we frequently review our insurance programs and requirements. However, a large number of our properties are located in areas particularly susceptible to revenue loss, cost increase or damage caused by severe weather conditions or natural disasters such as hurricanes, earthquakes, tornadoes and floods. We believe, given current industry practice and analysis prepared by outside consultants, that our and our tenants’ insurance coverage is appropriate to cover reasonably anticipated losses that may be caused by hurricanes, earthquakes, tornadoes, floods and other severe weather conditions and natural disasters, including the effects of climate change. Nevertheless, we are always subject to the risk that such insurance will not fully cover all losses and, depending on the severity of the event and the impact on our properties, such insurance may not cover a significant portion of the losses. These losses may lead to an increase of our and our tenants’ cost of insurance, a decrease in our anticipated revenues from an affected property and a loss of all or a portion of the capital we have invested in an affected property.  In addition, we or our tenants may not purchase insurance under certain circumstances if the cost of insurance exceeds, in our or our tenants’ judgment, the value of the coverage relative to the risk of loss.

 

We may incur costs to remediate environmental contamination at our properties, which could have an adverse effect on our or our obligors’ business or financial condition

 

     Under various laws, owners or operators of real estate may be required to respond to the presence or release of hazardous substances on the property and may be held liable for property damage, personal injuries or penalties that result from environmental contamination or exposure to hazardous substances. We may become liable to reimburse the government for damages and costs it incurs in connection with the contamination. Generally, such liability attaches to a person based on the person’s relationship to the property. Our tenants or borrowers are primarily responsible for the condition of the property. Moreover, we review environmental site assessments of the properties that we own or encumber prior to taking an interest in them. Those assessments are designed to meet the “all appropriate inquiry” standard, which we believe qualifies us for the innocent purchaser defense if environmental liabilities arise. Based upon such assessments, we do not believe that any of our properties are subject to material environmental contamination. However, environmental liabilities may be present in our properties and we may incur costs to remediate contamination, which could have a material adverse effect on our business or financial condition or the business or financial condition of our obligors.

 

Cybersecurity incidents could disrupt our business and result in the loss of confidential information

 

     Our business is at risk from and may be impacted by cybersecurity attacks, including attempts to gain unauthorized access to our confidential data, and other electronic security breaches, including those resulting from human error, product defects and technology failures. Such cyber-attacks can range from individual attempts to gain unauthorized access to our information technology systems to

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more sophisticated security threats. While we employ a number of measures to prevent, detect and mitigate these threats, there is no guarantee such efforts will be successful in preventing a cyber-attack. Cybersecurity incidents could disrupt our business, compromise the confidential information of our employees, operators, tenants and partners, damage our reputation and have a materially adverse effect on our business, financial condition and results of operations.

 

Our success depends on key personnel whose continued service is not guaranteed

 

     Our success depends on the continued availability and service of key personnel, including our executive officers and other highly qualified employees, and competition for their talents is intense.  We cannot assure you that we will retain our key personnel or that we will be able to recruit and retain other highly qualified employees in the future.  Losing any key personnel could, at least temporarily, have a material adverse effect on our business, financial position and results of operations.

 

Risks Arising from Our Capital Structure

 

Our certificate of incorporation and by-laws contain anti-takeover provisions

 

     Our certificate of incorporation and by-laws contain anti-takeover provisions (restrictions on share ownership and transfer and super majority stockholder approval requirements for business combinations) that could make it more difficult for or even prevent a third party from acquiring us without the approval of our incumbent Board of Directors. Provisions and agreements that inhibit or discourage takeover attempts could reduce the market value of our common stock.

 

We may become more leveraged

 

     Permanent financing for our investments is typically provided through a combination of public offerings of debt and equity securities and the incurrence or assumption of secured debt. The incurrence or assumption of indebtedness may cause us to become more leveraged, which could (1) require us to dedicate a greater portion of our cash flow to the payment of debt service, (2) make us more vulnerable to a downturn in the economy, (3) limit our ability to obtain additional financing, or (4) negatively affect our credit ratings or outlook by one or more of the rating agencies.

 

Cash available for distributions to stockholders may be insufficient to make dividend contributions at expected levels and are made at the discretion of the Board of Directors

 

     If cash available for distribution generated by our assets decreases due to dispositions or otherwise, we may be unable to make dividend distributions at expected levels.  Our inability to make expected distributions would likely result in a decrease in the market price of our common stock.  All distributions are made at the discretion of our Board of Directors in accordance with Delaware law and depend on our earnings, our financial condition, debt and equity capital available to us, our expectation of our future capital requirements and operating performance, restrictive covenants in our financial and other contractual arrangements, maintenance of our REIT qualification, restrictions under Delaware law and other factors as our Board of Directors may deem relevant from time to time.  Additionally, our ability to make distributions will be adversely affected if any of the risks described herein, or other significant adverse events, occur.

 

We are subject to covenants in our debt agreements that could have a material adverse impact on our business, results of operations and financial condition

 

     Our debt agreements contain various covenants, restrictions and events of default. Among other things, these provisions require us to maintain certain financial ratios and minimum net worth and impose certain limits on our ability to incur indebtedness, create liens and make investments or acquisitions. Breaches of these covenants could result in defaults under the instruments governing the applicable indebtedness, in addition to any other indebtedness cross-defaulted against such instruments. These defaults could have a material adverse impact on our business, results of operations and financial condition.

 

Limitations on our ability to access capital could have an adverse effect on our ability to make future investments or to meet our obligations and commitments

 

     We cannot assure you that we will be able to raise the capital necessary to make future investments or to meet our obligations and commitments as they mature.  Our access to capital depends upon a number of factors over which we have little or no control, including rising interest rates, inflation and other general market conditions; the market’s perception of our growth potential and our current and potential future earnings and cash distributions; the market price of the shares of our capital stock and the credit ratings of our debt securities; the financial stability of our lenders, which might impair their ability to meet their commitments to us or their willingness to make additional loans to us; changes in the credit ratings on U.S. government debt securities; or default or delay in payment by the U.S. of its obligations. If our access to capital is limited by these factors or other factors, it could negatively impact our ability to acquire properties, repay or refinance our indebtedness, fund operations or make distributions to our stockholders.

 

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Downgrades in our credit ratings could have a material adverse impact on our cost and availability of capital

 

     We plan to manage the Company to maintain a capital structure consistent with our current profile, but there can be no assurance that we will be able to maintain our current credit ratings. Any downgrades in terms of ratings or outlook by any or all of the rating agencies could have a material adverse impact on our cost and availability of capital, which could in turn have a material adverse impact on our results of operations, liquidity and/or financial condition.

 

Increases in interest rates could have a material adverse impact on our cost of capital

 

     An increase in interest rates may increase interest cost on new and existing variable rate debt.  Such increases in the cost of capital could adversely impact our ability to finance operations, the acquisition and development of properties, and refinance existing debt.  Additionally, increased interest rates may also result in less liquid property markets, limiting our ability to sell existing assets.

 

Fluctuations in the value of foreign currencies could adversely affect our results of operations and financial position

 

     Currency exchange rate fluctuations could affect our results of operations and financial position. We generate a portion of our revenue and expenses in such foreign currencies as the Canadian dollar and the British pound sterling. Although we may enter into foreign exchange agreements with financial institutions and/or obtain local currency mortgage debt in order to reduce our exposure to fluctuations in the value of foreign currencies, we cannot assure you that foreign currency fluctuations will not have a material adverse effect on us.

 

Our entry into hedge agreements may not effectively reduce our exposure to changes in interest rates or foreign currency exchange rates

 

     We enter into hedge agreements from time to time to manage some of our exposure to interest rate and foreign currency exchange rate volatility. These agreements involve risks, such as the risk that counterparties may fail to honor their obligations under these arrangements. In addition, these arrangements may not be effective in reducing our exposure to changes in interest rates or foreign currency exchange rates. When we use forward-starting interest rate swaps, there is a risk that we will not complete the long-term borrowing against which the swap is intended to hedge. If such events occur, our results of operations may be adversely affected.

 

Risks Arising from Our Status as a REIT

 

We might fail to qualify or remain qualified as a REIT

 

     We intend to operate as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”), and believe we have and will continue to operate in such a manner. If we lose our status as a REIT, we will face serious income tax consequences that will substantially reduce the funds available for satisfying our obligations and for distribution to our stockholders because:

          we would not be allowed a deduction for distributions to stockholders in computing our taxable income and would be subject to U.S. federal income tax at regular corporate rates;

          we could be subject to the federal alternative minimum tax and possibly increased state and local taxes; and

          unless we are entitled to relief under statutory provisions, we could not elect to be subject to tax as a REIT for four taxable years following the year during which we were disqualified.

 

     Since REIT qualification requires us to meet a number of complex requirements, it is possible that we may fail to fulfill them, and if we do, our earnings will be reduced by the amount of U.S. federal and other income taxes owed. A reduction in our earnings would affect the amount we could distribute to our stockholders. If we do not qualify as a REIT, we would not be required to make distributions to stockholders since a non-REIT is not required to pay dividends to stockholders in order to maintain REIT status or avoid an excise tax. In addition, if we fail to qualify as a REIT, all distributions to stockholders would continue to be treated as dividends to the extent of our current and accumulated earnings and profits, although corporate stockholders may be eligible for the dividends received deduction, and individual stockholders may be eligible for taxation at the rates generally applicable to long-term capital gains (currently at a maximum rate of 20%) with respect to distributions.

 

     As a result of all these factors, our failure to qualify as a REIT also could impair our ability to implement our business strategy and would adversely affect the value of our common stock. Qualification as a REIT involves the application of highly technical and complex Code provisions for which there are only limited judicial and administrative interpretations. The determination of various factual matters and circumstances not entirely within our control may affect our ability to remain qualified as a REIT. Although we believe that we qualify as a REIT, we cannot assure you that we will continue to qualify or remain qualified as a REIT for U.S. federal income tax purposes.

 

Certain subsidiaries might fail to qualify or remain qualified as a REIT

 

20


 

     We own interests in a number of entities which have elected to be taxed as REITs for U.S. federal income tax purposes, some of which we consolidate for financial reporting purposes but each of which is treated as a separate REIT for federal income tax purposes (each a “Subsidiary REIT”).  To qualify as a REIT, each Subsidiary REIT must independently satisfy all of the REIT qualification requirements under the Code, together with all other rules applicable to REITs.  Provided that each Subsidiary REIT qualifies as a REIT, our interests in the Subsidiary REITs will be treated as qualifying real estate assets for purposes of the REIT asset tests.  If a Subsidiary REIT fails to qualify as a REIT in any taxable year, such Subsidiary REIT will be subject to federal and state income taxes and may not be able to qualify as a REIT for the four subsequent taxable years.  Any such failure could have an adverse effect on our ability to comply with the REIT income and asset tests, and thus our ability to qualify as a REIT, unless we are able to avail ourselves of certain relief provisions.

 

The 90% annual distribution requirement will decrease our liquidity and may limit our ability to engage in otherwise beneficial transactions

 

     To comply with the 90% distribution requirement applicable to REITs and to avoid the nondeductible excise tax, we must make distributions to our stockholders. Although we anticipate that we generally will have sufficient cash or liquid assets to enable us to satisfy the REIT distribution requirement, it is possible that, from time to time, we may not have sufficient cash or other liquid assets to meet the 90% distribution requirement, or we may decide to retain cash or distribute such greater amount as may be necessary to avoid income and excise taxation. This may be due to timing differences between the actual receipt of income and actual payment of deductible expenses, on the one hand, and the inclusion of that income and deduction of those expenses in arriving at our taxable income, on the other hand. In addition, non-deductible expenses such as principal amortization or repayments or capital expenditures in excess of non-cash deductions may cause us to fail to have sufficient cash or liquid assets to enable us to satisfy the 90% distribution requirement. In the event that timing differences occur, or we deem it appropriate to retain cash, we may borrow funds, issue additional equity securities (although we cannot assure you that we will be able to do so), pay taxable stock dividends, if possible, distribute other property or securities or engage in another transaction intended to enable us to meet the REIT distribution requirements. This may require us to raise additional capital to meet our obligations.

 

The lease of qualified health care properties to a taxable REIT subsidiary is subject to special requirements

 

     We lease certain qualified health care properties to taxable REIT subsidiaries (or limited liability companies of which the taxable REIT subsidiaries are members), which lessees contract with managers (or related parties) to manage the health care operations at these properties. The rents from this taxable REIT subsidiary lessee structure are treated as qualifying rents from real property if (1) they are paid pursuant to an arms-length lease of a qualified health care property with a taxable REIT subsidiary and (2) the manager qualifies as an eligible independent contractor (as defined in the Code). If any of these conditions are not satisfied, then the rents will not be qualifying rents.

 

If certain sale-leaseback transactions are not characterized by the Internal Revenue Service (“IRS”) as “true leases,” we may be subject to adverse tax consequences

 

     We have purchased certain properties and leased them back to the sellers of such properties, and we may enter into similar transactions in the future. We intend for any such sale-leaseback transaction to be structured in such a manner that the lease will be characterized as a “true lease,” thereby allowing us to be treated as the owner of the property for U.S. federal income tax purposes. However, depending on the terms of any specific transaction, the IRS might take the position that the transaction is not a “true lease” but is more properly treated in some other manner. In the event any sale-leaseback transaction is challenged and successfully re-characterized by the IRS, we would not be entitled to claim the deductions for depreciation and cost recovery generally available to an owner of property. Furthermore, if a sale-leaseback transaction were so re-characterized, we might fail to satisfy the REIT asset tests or income tests and, consequently, could lose our REIT status effective with the year of re-characterization. Alternatively, the amount of our REIT taxable income could be recalculated, which may cause us to fail to meet the REIT annual distribution requirements for a taxable year.

 

We could be subject to changes in our tax rates, the adoption of new U.S. or international tax legislation, or exposure to additional tax liabilities

 

     We are subject to taxes in the U.S. and foreign jurisdictions.  Our analysis of the Tax Act may be impacted by any corrective legislation and any guidance provided by the U.S. Treasury, the IRS or by the General Explanation of the Tax Act, which is under preparation by the Staff of the Congressional Joint Committee on Taxation.  Our effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their interpretation.  We are also subject to the examination of our tax returns and other tax matters by the IRS and other tax authorities and governmental bodies.  We regularly assess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of our provision for taxes.  There can be no assurance as to the outcome of these examinations.  If we were subject to review or examination by the IRS or applicable foreign jurisdiction as the result of any new tax law changes (including the recently enacted Tax Act) the ultimate determination of which may change our taxes owed for an amount in excess of amounts previously accrued or recorded, our financial condition, operating results, and cash flows could be adversely affected.

21


 

 

Item 1B.  Unresolved Staff Comments

None.

22


 

Item 2.  Properties 

 

We own our corporate headquarters located at 4500 Dorr Street, Toledo, Ohio 43615. We also lease corporate offices in Canada, the United Kingdom and Luxembourg and have ground leases relating to certain of our properties. The following table sets forth certain information regarding the properties that comprise our consolidated real property and real estate loan investments as of December 31, 2017 (dollars in thousands and annualized revenues adjusted for timing of investment):

 

 

 

 

Triple-net

 

Seniors Housing Operating

Property Location

 

Number of Properties

 

Total Investment

 

Annualized Revenues

 

Number of Properties

 

Total Investment

 

Annualized Revenues

 

Alabama

 

4

 

$

34,374

 

$

4,198

 

-

 

$

-

 

$

-

 

Arizona

 

2

 

 

26,771

 

 

2,349

 

4

 

 

59,180

 

 

22,940

 

California

 

25

 

 

425,291

 

 

50,368

 

71

 

 

2,629,870

 

 

636,760

 

Colorado

 

8

 

 

253,330

 

 

22,718

 

5

 

 

137,842

 

 

39,864

 

Connecticut

 

13

 

 

162,800

 

 

20,314

 

17

 

 

420,700

 

 

135,459

 

District Of Columbia

 

-

 

 

-

 

 

-

 

1

 

 

62,508

 

 

14,169

 

Delaware

 

6

 

 

102,090

 

 

12,340

 

1

 

 

20,657

 

 

6,750

 

Florida

 

21

 

 

208,011

 

 

22,468

 

9

 

 

714,900

 

 

110,064

 

Georgia

 

3

 

 

21,769

 

 

4,435

 

7

 

 

119,906

 

 

35,284

 

Iowa

 

4

 

 

55,228

 

 

5,588

 

1

 

 

31,736

 

 

11,292

 

Idaho

 

2

 

 

21,801

 

 

3,547

 

-

 

 

-

 

 

-

 

Illinois

 

9

 

 

157,493

 

 

16,926

 

14

 

 

438,607

 

 

111,523

 

Indiana

 

32

 

 

462,707

 

 

50,889

 

-

 

 

-

 

 

-

 

Kansas

 

27

 

 

259,364

 

 

26,624

 

3

 

 

68,739

 

 

17,284

 

Kentucky

 

6

 

 

50,832

 

 

8,676

 

2

 

 

38,366

 

 

14,209

 

Louisiana

 

3

 

 

19,168

 

 

3,328

 

2

 

 

49,858

 

 

12,373

 

Massachusetts

 

20

 

 

185,084

 

 

32,601

 

39

 

 

1,124,085

 

 

253,943

 

Maryland

 

8

 

 

133,528

 

 

8,969

 

4

 

 

149,237

 

 

51,050

 

Maine

 

-

 

 

-

 

 

-

 

2

 

 

49,437

 

 

18,715

 

Michigan

 

6

 

 

96,814

 

 

10,165

 

5

 

 

108,521

 

 

24,860

 

Minnesota

 

10

 

 

222,546

 

 

18,809

 

4

 

 

111,503

 

 

21,595

 

Missouri

 

1

 

 

11,926

 

 

186

 

5

 

 

147,090

 

 

23,376

 

Mississippi

 

3

 

 

26,661

 

 

1,887

 

-

 

 

-

 

 

-

 

Montana

 

1

 

 

5,841

 

 

959

 

-

 

 

-

 

 

-

 

North Carolina

 

50

 

 

369,065

 

 

41,964

 

1

 

 

39,461

 

 

7,239

 

Nebraska

 

4

 

 

31,942

 

 

4,067

 

-

 

 

-

 

 

-

 

New Hampshire

 

4

 

 

51,186

 

 

7,599

 

4

 

 

117,062

 

 

29,986

 

New Jersey

 

56

 

 

1,229,004

 

 

132,850

 

8

 

 

233,766

 

 

65,306

 

New Mexico

 

-

 

 

-

 

 

-

 

1

 

 

18,199

 

 

1,375

 

Nevada

 

5

 

 

80,918

 

 

12,785

 

2

 

 

35,919

 

 

10,995

 

New York

 

6

 

 

147,412

 

 

15,993

 

10

 

 

334,217

 

 

87,283

 

Ohio

 

16

 

 

125,308

 

 

31,430

 

5

 

 

216,731

 

 

36,858

 

Oklahoma

 

21

 

 

225,662

 

 

20,181

 

2

 

 

39,679

 

 

3,374

 

Oregon

 

10

 

 

74,169

 

 

7,125

 

-

 

 

-

 

 

-

 

Pennsylvania

 

31

 

 

766,860

 

 

12,909

 

6

 

 

80,343

 

 

39,962

 

Rhode Island

 

-

 

 

-

 

 

-

 

3

 

 

59,215

 

 

20,345

 

South Carolina

 

5

 

 

31,653

 

 

5,698

 

-

 

 

-

 

 

-

 

Tennessee

 

4

 

 

39,654

 

 

3,839

 

2

 

 

48,830

 

 

15,741

 

Texas

 

37

 

 

387,507

 

 

48,760

 

30

 

 

928,494

 

 

205,362

 

Utah

 

2

 

 

30,108

 

 

2,582

 

1

 

 

16,315

 

 

10,546

 

Virginia

 

12

 

 

179,684

 

 

13,229

 

3

 

 

92,020

 

 

11,062

 

Vermont

 

-

 

 

-

 

 

-

 

1

 

 

26,501

 

 

6,710

 

Washington

 

18

 

 

318,379

 

 

33,773

 

12

 

 

403,565

 

 

78,355

 

Wisconsin

 

7

 

 

108,644

 

 

14,650

 

-

 

 

-

 

 

-

 

West Virginia

 

4

 

 

66,949

 

 

8,454

 

-

 

 

-

 

 

-

 

Total domestic

 

506

 

 

7,207,533

 

 

746,232

 

287

 

 

9,173,059

 

 

2,192,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada

 

6

 

 

160,418

 

 

11,023

 

103

 

 

2,077,853

 

 

440,222

 

United Kingdom

 

61

 

 

1,220,528

 

 

107,728

 

53

 

 

1,542,910

 

 

312,009

 

Total international

 

67

 

 

1,380,946

 

 

118,751

 

156

 

 

3,620,763

 

 

752,231

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Grand total

 

573

 

$

8,588,479

 

$

864,983

 

443

 

$

12,793,822

 

$

2,944,240

23


 

 

 

 

Outpatient Medical

Property Location

 

Number of Properties

 

Total Investment

 

Annualized Revenues

 

Alaska

 

2

 

$

23,414

 

$

2,423

 

Alabama

 

3

 

 

30,119

 

 

5,515

 

Arkansas

 

1

 

 

22,730

 

 

2,067

 

Arizona

 

4

 

 

62,649

 

 

9,453

 

California

 

32

 

 

866,727

 

 

91,492

 

Colorado

 

2

 

 

32,967

 

 

5,025

 

Connecticut

 

1

 

 

41,686

 

 

3,939

 

Florida

 

36

 

 

436,149

 

 

50,703

 

Georgia

 

10

 

 

169,521

 

 

28,178

 

Iowa

 

1

 

 

6,615

 

 

1,303

 

Illinois

 

5

 

 

49,505

 

 

8,749

 

Indiana

 

9

 

 

162,463

 

 

20,157

 

Kansas

 

7

 

 

72,142

 

 

12,695

 

Kentucky

 

1

 

 

7,297

 

 

679

 

Maryland

 

5

 

 

93,869

 

 

11,817

 

Maine

 

1

 

 

19,290

 

 

2,824

 

Michigan

 

2

 

 

30,159

 

 

4,141

 

Minnesota

 

8

 

 

165,704

 

 

26,127

 

Missouri

 

8

 

 

144,391

 

 

17,451

 

North Carolina

 

3

 

 

53,499

 

 

7,086

 

Nebraska

 

2

 

 

33,727

 

 

5,379

 

New Hampshire

 

1

 

 

13,344

 

 

1,758

 

New Jersey

 

8

 

 

266,546

 

 

44,194

 

New Mexico

 

3

 

 

31,760

 

 

3,731

 

Nevada

 

5

 

 

43,466

 

 

4,200

 

New York

 

8

 

 

109,193

 

 

7,214

 

Ohio

 

5

 

 

51,894

 

 

9,845

 

Oklahoma

 

2

 

 

23,633

 

 

3,318

 

Oregon

 

1

 

 

9,279

 

 

1,453

 

South Carolina

 

1

 

 

24,844

 

 

2,615

 

Tennessee

 

6

 

 

64,569

 

 

7,831

 

Texas

 

55

 

 

892,224

 

 

89,447

 

Virginia

 

2

 

 

31,824

 

 

4,846

 

Washington

 

6

 

 

170,665

 

 

20,456

 

Wisconsin

 

20

 

 

244,483

 

 

32,779

 

Total domestic

 

266

 

 

4,502,347

 

 

550,890

 

 

 

 

 

 

 

 

 

 

 

United Kingdom

 

4

 

 

286,434

 

 

25,880

 

Grand total

 

270

 

$

4,788,781

 

$

576,770

 

The following table sets forth occupancy, coverages and average annualized revenues for certain property types (excluding investments in unconsolidated entities):

 

 

Occupancy(1)

 

Coverages(1,2)

 

Average Annualized Revenues(3)

 

 

 

 

2017

 

2016

 

2017

 

2016

 

2017

 

2016

 

 

Triple-net(4)

 

85.8%

 

86.5%

 

 1.34x  

 

 1.43x  

 

$

15,663

 

$

16,841

 

per bed/unit

Seniors housing operating(5)

 

86.5%

 

88.7%

 

n/a

 

n/a

 

 

60,828

 

 

59,627

 

per unit

Outpatient medical(6)

 

93.7%

 

94.7%

 

n/a

 

n/a

 

 

33

 

 

33

 

per sq. ft.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) We use unaudited, periodic financial information provided solely by tenants/borrowers to calculate occupancy and coverages for properties other than outpatient medical buildings and have not independently verified the information.

(2) Represents the ratio of our triple-net customers' earnings before interest, taxes, depreciation, amortization, rent and management fees to contractual rent or interest due us. Data reflects the twelve months ended September 30 for the periods presented.

(3) Represents annualized revenues divided by total beds, units or square feet as presented in the tables above.

(4) Occupancy represents average quarterly operating occupancy based on the quarters ended September 30 and excludes properties that are unstabilized, closed or for which data is not available or meaningful.

(5) Occupancy represents average occupancy for the three months ended December 31.

(6) Occupancy represents the percentage of total rentable square feet leased and occupied (including month-to-month and holdover leases and excluding terminations) as of December 31.

24


 

The following table sets forth information regarding lease expirations for certain portions of our portfolio as of December 31, 2017 (dollars in thousands):

 

 

 

 

Expiration Year(1)

 

 

 

 

2018

 

 

2019

 

 

2020

 

 

2021

 

 

2022

 

 

2023

 

 

2024

 

 

2025

 

 

2026

 

 

2027

 

 

Thereafter

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Triple-net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Properties

 

 

100

 

 

-

 

 

14

 

 

10

 

 

13

 

 

11

 

 

4

 

 

59

 

 

31

 

 

45

 

 

272

  

Base rent(2)

 

$

107,517

 

$

-

 

$

17,740

 

$

16,576

 

$

9,895

 

$

8,348

 

$

10,842

 

$

76,589

 

$

63,138

 

$

95,730

 

$

482,337

 

% of base rent

 

 

12.1%

 

 

0.0%

 

 

2.0%

 

 

1.9%

 

 

1.1%

 

 

0.9%

 

 

1.2%

 

 

8.6%

 

 

7.1%

 

 

10.8%

 

 

54.3%

 

Units

 

 

8,715

 

 

-

 

 

1,225

 

 

1,620

 

 

1,220

 

 

1,432

 

 

692

 

 

4,489

 

 

3,662

 

 

4,647

 

 

26,065

 

% of units

 

 

16.2%

 

 

0.0%

 

 

2.3%

 

 

3.0%

 

 

2.3%

 

 

2.7%

 

 

1.3%

 

 

8.3%

 

 

6.8%

 

 

8.6%

 

 

48.5%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outpatient medical:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Square feet

 

 

2,382,066

 

 

1,173,527

 

 

1,312,277

 

 

1,502,213

 

 

1,701,977

 

 

1,048,663

 

 

1,143,704

 

 

736,777

 

 

1,133,674

 

 

402,904

 

 

4,359,985

  

Base rent(2)

 

$

50,744

 

$

32,011

 

$

35,425

 

$

39,984

 

$

45,079

 

$

28,599

 

$

32,946

 

$

21,255

 

$

28,705

 

$

11,425

 

$

98,411

 

% of base rent

 

 

12.0%

 

 

7.5%

 

 

8.3%

 

 

9.4%

 

 

10.6%

 

 

6.7%

 

 

7.8%

 

 

5.0%

 

 

6.8%

 

 

2.7%

 

 

23.2%

 

Leases

 

 

317

 

 

310

 

 

311

 

 

268

 

 

302

 

 

203

 

 

122

 

 

108

 

 

126

 

 

78

 

 

162

 

% of leases

 

 

13.7%

 

 

13.4%

 

 

13.5%

 

 

11.6%

 

 

13.1%

 

 

8.8%

 

 

5.3%

 

 

4.7%

 

 

5.5%

 

 

3.4%

 

 

6.9%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Excludes investments in unconsolidated entities. Investments classified as held for sale are included in 2018.

(2) The most recent monthly base rent including straight-line for leases with fixed escalators or annual cash rents with contingent escalators.  Base rent does not include tenant recoveries or amortization of above and below market lease intangibles.

 

Item 3.  Legal Proceedings

 

     From time to time, there are various legal proceedings pending against us that arise in the ordinary course of our business.  Management does not believe that the resolution of any of these legal proceedings either individually or in the aggregate will have a material adverse effect on our business, results of operations or financial condition.  Further, from time to time, we are party to certain legal proceedings for which third parties, such as tenants, operators and/or managers are contractually obligated to indemnify, defend and hold us harmless.  In some of these matters, the indemnitors have insurance for the potential damages.  In other matters, we are being defended by tenants and other obligated third parties and these indemnitors may not have sufficient insurance, assets, income or resources to satisfy their defense and indemnification obligations to us.  The unfavorable resolution of such legal proceedings could, individually or in the aggregate, materially adversely affect the indemnitors’ ability to satisfy their respective obligations to us, which, in turn, could have a material adverse effect on our business, results of operations or financial condition.  It is management’s opinion that there are currently no such legal proceedings pending that will, individually or in the aggregate, have such a material adverse effect. Despite management’s view of the ultimate resolution of these legal proceedings, we may have significant legal expenses and costs associated with the defense of such matters.  Further, management cannot predict the outcome of these legal proceedings and if management’s expectation regarding such matters is not correct, such proceedings could have a material adverse effect on our business, results of operations or financial condition.

 

Item 4.  Mine Safety Disclosures

 

None.

PART II

 

Item 5.  Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 

There were 4,761 stockholders of record as of January 31, 2018. The following table sets forth, for the periods indicated, the high and low prices of our common stock on the New York Stock Exchange (NYSE:WELL), and common dividends paid per share:

  

 

 

  

Sales Price

 

Dividends Paid

 

 

  

High

 

Low

 

Per Share

2017

  

 

 

 

 

 

 

 

 

 

First Quarter

  

$

71.17

 

$

64.63

 

$

0.87

 

Second Quarter

  

 

78.17

 

 

68.66

 

 

0.87

 

Third Quarter

  

 

75.91

 

 

69.77

 

 

0.87

 

Fourth Quarter

  

 

70.87

 

 

63.06

 

 

0.87

 

 

  

 

 

 

 

 

 

 

 

2016

  

 

 

 

 

 

 

 

 

 

First Quarter

  

$

70.45

 

$

52.80

 

$

0.86

 

Second Quarter

  

 

76.24

 

 

66.55

 

 

0.86

 

Third Quarter

  

 

80.19

 

 

72.34

 

 

0.86

 

Fourth Quarter

  

 

74.85

 

 

59.39

 

 

0.86

 

Our Board of Directors has approved a 2018 quarterly cash dividend rate of $0.87 per share of common stock per quarter, commencing with the February 2018 dividend. The declaration and payment of quarterly dividends remains subject to the review and approval of the Board of Directors.

25


 

 

Stockholder Return Performance Presentation

 

Set forth below is a line graph comparing the yearly percentage change and the cumulative total stockholder return on our shares of common stock against the cumulative total return of the S & P Composite-500 Stock Index and the FTSE NAREIT Equity Index. As of December 31, 2017, 157 companies comprised the FTSE NAREIT Equity Index, which consists of REITs identified by NAREIT as equity (those REITs which have at least 75% of their investments in real property). The data are based on the closing prices as of December 31 for each of the five years. 2012 equals $100 and dividends are assumed to be reinvested.

 

 

 

 

12/31/12

12/31/13

12/31/14

12/31/15

12/31/16

12/31/17

 

S & P 500

100.00

132.39

150.51

152.59

170.84

208.14

 

 Welltower Inc.

100.00

91.58

136.01

128.23

132.55

132.81

 

FTSE NAREIT Equity

100.00

102.47

133.35

137.61

149.33

157.14

 

 

Except to the extent that we specifically incorporate this information by reference, the foregoing Stockholder Return Performance Presentation shall not be deemed incorporated by reference by any general statement incorporating by reference this Annual Report on Form 10-K into any filing under the Securities Act of 1933, as amended, or under the Securities Exchange Act of 1934, as amended. This information shall not otherwise be deemed filed under such Acts.

  

Issuer Purchases of Equity Securities

Period

 

Total Number of Shares Purchased(1)

 

Average Price Paid Per Share

 

Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)

 

Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs

October 1, 2017 through October 31, 2017

 

-

 

$

-

 

 

 

 

November 1, 2017 through November 30, 2017

 

249

 

 

68.46

 

 

 

 

December 1, 2017 through December 31, 2017

 

32,072

 

 

67.94

 

 

 

 

Totals

 

32,321

 

$

67.94

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) During the three months ended December 31, 2017, the Company acquired shares of common stock held by employees who tendered owned shares to satisfy tax withholding obligations.

(2) No shares were purchased as part of publicly announced plans or programs.

26


 

Item 6.  Selected Financial Data

 

The following selected financial data for the five years ended December 31, 2017 are derived from our audited consolidated financial statements (in thousands, except per share data):

 

 

 

Year Ended December 31,

 

 

 

2013

 

2014

 

2015

 

2016

 

2017

Operating Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

2,880,608

 

$

3,343,546

 

$

3,859,826

 

$

4,281,160

 

$

4,316,641

Expenses

 

 

2,778,363

 

 

2,959,333

 

 

3,223,709

 

 

3,571,907

 

 

4,017,025

Income from continuing operations before income taxes and income (loss) from unconsolidated entities

 

 

102,245

 

 

384,213

 

 

636,117

 

 

709,253

 

 

299,616

Income tax (expense) benefit

 

 

(7,491)

 

 

1,267

 

 

(6,451)

 

 

19,128

 

 

(20,128)

Income (loss) from unconsolidated entities

 

 

(8,187)

 

 

(27,426)

 

 

(21,504)

 

 

(10,357)

 

 

(83,125)

Income from continuing operations

 

 

86,567

 

 

358,054

 

 

608,162

 

 

718,024

 

 

196,363

Income from discontinued operations, net

 

 

51,713

 

 

7,135

 

 

-

 

 

-

 

 

-

Gain (loss) on real estate dispositions, net

 

 

-

 

 

147,111

 

 

280,387

 

 

364,046

 

 

344,250

Net income

 

 

138,280

 

 

512,300

 

 

888,549

 

 

1,082,070

 

 

540,613

Preferred stock dividends

 

 

66,336

 

 

65,408

 

 

65,406

 

 

65,406

 

 

49,410

Preferred stock redemption charge

 

 

-

 

 

-

 

 

-

 

 

-

 

 

9,769

Net income (loss) attributable to noncontrolling interests

 

 

(6,770)

 

 

147

 

 

4,799

 

 

4,267

 

 

17,839

Net income attributable to common stockholders

 

$

78,714

 

$

446,745

 

$

818,344

 

$

1,012,397

 

$

463,595

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

276,929

 

 

306,272

 

 

348,240

 

 

358,275

 

 

367,237

 

Diluted

 

 

278,761

 

 

307,747

 

 

349,424

 

 

360,227

 

 

369,001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations attributable to common stockholders

 

$

0.10

 

$

1.44

 

$

2.35

 

$

2.83

 

$

1.26

 

Discontinued operations, net

 

 

0.19

 

 

0.02

 

 

-

 

 

-

 

 

-

 

Net income attributable to common stockholders *

 

$

0.28

 

$

1.46

 

$

2.35

 

$

2.83

 

$

1.26

Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations attributable to common stockholders

 

$

0.10

 

$

1.43

 

$

2.34

 

$

2.81

 

$

1.26

 

Discontinued operations, net

 

 

0.19

 

 

0.02

 

 

-

 

 

-

 

 

-

 

Net income attributable to common stockholders *

 

$

0.28

 

$

1.45

 

$

2.34

 

$

2.81

 

$

1.26

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash distributions per common share

 

$

3.06

 

$

3.18

 

$

3.30

 

$

3.44

 

$

3.48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

Balance Sheet Data

 

 

2013

 

 

2014

 

 

2015

 

 

2016

 

 

2017

 

Net real estate investments

 

$

21,680,221

 

$

22,851,196

 

$

26,888,685

 

$

26,563,629

 

$

26,171,077

 

Total assets

 

 

23,026,666

 

 

24,962,923

 

 

29,023,845

 

 

28,865,184

 

 

27,944,445

 

Total long-term obligations

 

 

10,594,723

 

 

10,776,640

 

 

12,967,686

 

 

12,358,245

 

 

11,731,936

 

Total liabilities

 

 

11,235,296

 

 

11,403,465

 

 

13,664,877

 

 

13,185,279

 

 

12,643,799

 

Total preferred stock

 

 

1,017,361

 

 

1,006,250

 

 

1,006,250

 

 

1,006,250

 

 

718,503

 

Total equity

 

 

11,756,331

 

 

13,473,049

 

 

15,175,885

 

 

15,281,472

 

 

14,925,452

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

* Amounts may not sum due to rounding

27


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

EXECUTIVE SUMMARY

 

 

 

 

 

 

     Company Overview

     Business Strategy

     Key Transactions

     Key Performance Indicators, Trends and Uncertainties

     Corporate Governance

29

29

30

30

32

 

 

 

 

 

 

LIQUIDITY AND CAPITAL RESOURCES

 

 

 

 

 

 

     Sources and Uses of Cash

     Off-Balance Sheet Arrangements

     Contractual Obligations

     Capital Structure

32

33

33

34

 

 

 

 

 

 

RESULTS OF OPERATIONS

 

 

 

 

 

 

     Summary

     Triple-net

     Seniors Housing Operating

     Outpatient Medical

     Non-Segment/Corporate

34

35

38

39

41

 

 

 

 

 

 

OTHER

 

 

 

 

 

 

     Non-GAAP Financial Measures

43

 

 

     Critical Accounting Policies

48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

28


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

     The following discussion and analysis is based primarily on the consolidated financial statements of Welltower Inc. presented in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) for the periods presented and should be read together with the notes thereto contained in this Annual Report on Form 10-K. Other important factors are identified in “Item 1 — Business” and “Item 1A — Risk Factors” above.

Executive Summary

Company Overview

     Welltower Inc. (NYSE:WELL), an S&P 500 company headquartered in Toledo, Ohio, is driving the transformation of health care infrastructure.  The Company invests with leading seniors housing operators, post-acute providers and health systems to fund the real estate and infrastructure needed to scale innovative care delivery models and improve people’s wellness and overall health care experience.  WelltowerTM, a real estate investment trust (“REIT”), owns interests in properties concentrated in major, high-growth markets in the United States (“U.S.”), Canada and the United Kingdom (“U.K.”), consisting of seniors housing and post-acute communities and outpatient medical properties.  Our capital programs, when combined with comprehensive planning, development and property management services, make us a single-source solution for acquiring, planning, developing, managing, repositioning and monetizing real estate assets.

     The following table summarizes our consolidated portfolio for the year ended December 31, 2017 (dollars in thousands):

 

 

 

Percentage of

 

Number of

 

Type of Property

NOI(1)

 

NOI

 

Properties

 

Triple-net

$

967,084

 

43.3%

 

573

 

Seniors housing operating

 

880,026

 

39.5%

 

443

 

Outpatient medical

 

384,068

 

17.2%

 

270

 

Totals

$

2,231,178

 

100.0%

 

1,286

 

 

 

 

 

 

 

 

 

(1) Represents consolidated NOI and excludes our share of investments in unconsolidated entities.  Entities in which we have a joint venture with a minority partner are shown at 100% of the joint venture amount. See Non-GAAP Financial Measures for additional information and reconciliation.

Business Strategy

     Our primary objectives are to protect stockholder capital and enhance stockholder value. We seek to pay consistent cash dividends to stockholders and create opportunities to increase dividend payments to stockholders as a result of annual increases in net operating income and portfolio growth. To meet these objectives, we invest across the full spectrum of seniors housing and health care real estate and diversify our investment portfolio by property type, relationship and geographic location.

     Substantially all of our revenues are derived from operating lease rentals, resident fees/services, and interest earned on outstanding loans receivable. These items represent our primary sources of liquidity to fund distributions and depend upon the continued ability of our obligors to make contractual rent and interest payments to us and the profitability of our operating properties. To the extent that our obligors/partners experience operating difficulties and become unable to generate sufficient cash to make payments or operating distributions to us, there could be a material adverse impact on our consolidated results of operations, liquidity and/or financial condition. To mitigate this risk, we monitor our investments through a variety of methods determined by the type of property. Our asset management process for seniors housing properties generally includes review of monthly financial statements and other operating data for each property, review of obligor/partner creditworthiness, property inspections, and review of covenant compliance relating to licensure, real estate taxes, letters of credit and other collateral. Our internal property management division manages and monitors the outpatient medical portfolio with a comprehensive process including review of tenant relations, lease expirations, the mix of health service providers, hospital/health system relationships, property performance, capital improvement needs, and market conditions among other things. We evaluate the operating environment in each property’s market to determine the likely trend in operating performance of the facility.  When we identify unacceptable trends, we seek to mitigate, eliminate or transfer the risk. Through these efforts, we are generally able to intervene at an early stage to address any negative trends, and in so doing, support both the collectability of revenue and the value of our investment.

     In addition to our asset management and research efforts, we also structure our relevant investments to help mitigate payment risk. Operating leases and loans are normally credit enhanced by guaranties and/or letters of credit. In addition, operating leases are typically structured as master leases and loans are generally cross-defaulted and cross-collateralized with other real estate loans, operating leases or agreements between us and the obligor and its affiliates.

     For the year ended December 31, 2017, rental income and resident fees/services represented 33% and 64%, respectively, of total revenues.  Substantially all of our operating leases are designed with escalating rent structures. Leases with fixed annual rental escalators are generally recognized on a straight-line basis over the initial lease period, subject to a collectability assessment. Rental income related to leases with contingent rental escalators is generally recorded based on the contractual cash rental payments due for the period. Our yield on loans receivable depends upon a number of factors, including the stated interest rate, the average principal amount outstanding during the term of the loan, and any interest rate adjustments.

     Our primary sources of cash include rent and interest receipts, resident fees/services, borrowings under our primary unsecured credit facility, public issuances of debt and equity securities, proceeds from investment dispositions, and principal payments on loans receivable. Our primary uses of cash include dividend distributions, debt service payments (including principal and interest), real

29


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

property investments (including acquisitions, capital expenditures, construction advances, and transaction costs), loan advances, property operating expenses, and general and administrative expenses.  Depending upon the availability and cost of external capital, we believe our liquidity is sufficient to fund these uses of cash.

     We also continuously evaluate opportunities to finance future investments.  New investments are generally funded from temporary borrowings under our primary unsecured credit facility, internally generated cash and the proceeds from investment dispositions. Our investments generate cash from net operating income and principal payments on loans receivable. Permanent financing for future investments, which replaces funds drawn under our primary unsecured credit facility, has historically been provided through a combination of the issuance of public debt and equity securities and the incurrence or assumption of secured debt.

     Depending upon market conditions, we believe that new investments will be available in the future with spreads over our cost of capital that will generate appropriate returns to our stockholders. It is also likely that investment dispositions may occur in the future. To the extent that investment dispositions exceed new investments, our revenues and cash flows from operations could be adversely affected. We expect to reinvest the proceeds from any investment dispositions in new investments. To the extent that new investment requirements exceed our available cash on-hand, we expect to borrow under our primary unsecured credit facility. At December 31, 2017, we had $243,777,000 of cash and cash equivalents, $65,526,000 of restricted cash and $2,258,635,000 of available borrowing capacity under our primary unsecured credit facility.

Key Transactions

          Capital.   During the year ended December 31, 2017, we extinguished $1,080,268,000 of secured debt at a blended average interest rate of 5.2%.  In addition, we redeemed all 11,500,000 shares of our 6.5% Series J Cumulative Redeemable Preferred Stock.  Also, for the year ended December 31, 2017, we raised $611,443,000 through our dividend reinvestment program and our Equity Shelf Program (as defined below).  The capital raised, in combination with available cash and borrowing capacity under our primary unsecured credit facility and proceeds from dispositions, supported new investment activity for the year.

 

     Investments. The following summarizes our property acquisitions and joint venture investments made during the year ended December 31, 2017 (dollars in thousands):

 

Properties

 

Investment Amount(1)

 

Capitalization Rates(2)

 

 

Book Amount(3)

 

Triple-net

9

$

170,076

 

6.4%

 

$

281,875

 

Seniors housing operating

8

 

375,400

 

6.6%

 

 

539,173

 

Outpatient medical

9

 

196,544

 

5.9%

 

 

224,232

 

Totals

26

$

742,020

 

6.3%

 

$

1,045,280

 

 

 

 

 

 

 

 

 

 

 

(1) Represents stated pro rata purchase price including cash and any assumed debt but excludes fair value adjustments pursuant to U.S. GAAP.

(2) Represents annualized contractual or projected net operating income to be received in cash divided by investment amounts.

(3) Represents amounts recorded on our books including fair value adjustments pursuant to U.S. GAAP.  See Note 3 to our consolidated financial statements for additional information.

 

     Dispositions. The following summarizes property dispositions made during the year ended December 31, 2017 (dollars in thousands):

 

Properties

 

Proceeds(1)

 

Capitalization Rates(2)

 

 

Book Amount(3)

 

Triple-net

59

$

1,190,791

 

6.9%

 

$

916,689

 

Seniors housing operating

3

 

105,349

 

4.6%

 

 

74,832

 

Outpatient medical

3

 

23,590

 

8.3%

 

 

19,697

 

Totals

65

$

1,319,730

 

6.7%

 

$

1,011,218

 

 

 

 

 

 

 

 

 

 

 

(1) Represents pro rata proceeds received upon disposition including any seller financing.

(2) Represents annualized contractual net operating income that was being received in cash at date of disposition divided by disposition proceeds.

(3) Represents carrying value of assets at time of disposition.  See Note 5 to our consolidated financial statements for additional information.

 

     Dividends. Our Board of Directors announced the 2018 annual cash dividend of $3.48 per common share ($0.87 per share quarterly), consistent with 2017, beginning in February 2018.  The dividend declared for the quarter ended December 31, 2017 represents the 187th consecutive quarterly dividend payment.

  

Key Performance Indicators, Trends and Uncertainties

     We utilize several key performance indicators to evaluate the various aspects of our business. These indicators are discussed below and relate to operating performance, credit strength and concentration risk.  Management uses these key performance indicators to facilitate internal and external comparisons to our historical operating results, in making operating decisions, and for budget planning

30


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

purposes.

     Operating Performance. We believe that net income and net income attributable to common stockholders (“NICS”) per the Statement of Comprehensive Income are the most appropriate earnings measures. Other useful supplemental measures of our operating performance include funds from operations attributable to common stockholders (“FFO”), consolidated net operating income (“NOI”) and same store NOI (“SSNOI”); however, these supplemental measures are not defined by U.S. GAAP. Please refer to the section entitled “Non-GAAP Financial Measures” for further discussion and reconciliations. These earnings measures are widely used by investors and analysts in the valuation, comparison, and investment recommendations of companies. The following table reflects the recent historical trends of our operating performance measures for the periods presented (in thousands):

  

 

 

 

 

Year Ended December 31,

 

 

 

 

2015

 

2016

 

2017

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

888,549

 

$

1,082,070

 

$

540,613

Net income attributable to common stockholders

 

 

818,344

 

 

1,012,397

 

 

463,595

Funds from operations attributable to common stockholders

 

 

1,409,640

 

 

1,582,940

 

 

1,165,576

Consolidated net operating income

 

 

2,237,569

 

 

2,404,177

 

 

2,232,716

Same store net operating income

 

 

1,523,666

 

 

1,499,511

 

 

1,519,193

 

     Credit Strength. We measure our credit strength both in terms of leverage ratios and coverage ratios. The leverage ratios indicate how much of our balance sheet capitalization is related to long-term debt, net of cash and Internal Revenue Code (“IRC”) section 1031 deposits. The coverage ratios indicate our ability to service interest and fixed charges (interest, secured debt principal amortization and preferred dividends). We expect to maintain capitalization ratios and coverage ratios sufficient to maintain a capital structure consistent with our current profile. The coverage ratios are based on adjusted earnings before interest, taxes, depreciation and amortization (“AEBITDA”). Please refer to the section entitled “Non-GAAP Financial Measures” for further discussion and reconciliation of these measures. Leverage ratios and coverage ratios are widely used by investors, analysts and rating agencies in the valuation, comparison, investment recommendations, and rating of companies. The following table reflects the recent historical trends for our credit strength measures for the periods presented:

  

 

 

 

 

Year Ended December 31,

 

 

 

 

2015

 

2016

 

2017

 

 

 

 

 

 

 

 

 

Net debt to book capitalization ratio

 

44.8%

 

42.9%

 

42.9%

Net debt to undepreciated book capitalization ratio

 

39.5%

 

37.4%

 

36.3%

Net debt to market capitalization ratio

 

32.5%

 

31.1%

 

31.2%

 

 

 

 

 

 

 

 

 

Adjusted interest coverage ratio

 

4.24x

 

4.21x

 

4.36x

Adjusted fixed charge coverage ratio

 

3.35x

 

3.34x

 

3.54x

 

     Concentration Risk. We evaluate our concentration risk in terms of NOI by property mix, relationship mix and geographic mix. Concentration risk is a valuable measure in understanding what portion of our NOI could be at risk if certain sectors were to experience downturns. Property mix measures the portion of our NOI that relates to our various property types. Relationship mix measures the portion of our NOI that relates to our top five relationships.  Geographic mix measures the portion of our NOI that relates to our top five states (or international equivalents). The following table reflects our recent historical trends of concentration risk by NOI for the periods indicated below:

31


 

 

 

 

December 31,(1)

 

 

 

 

2015

 

2016

 

2017

 

 

 

 

 

 

 

 

 

Property mix:

 

 

 

 

 

 

 

Triple-net

 

54%

 

50%

 

43%

 

Seniors housing operating

 

31%

 

34%

 

40%

 

Outpatient medical

 

15%

 

16%

 

17%

 

 

 

 

 

 

 

 

 

Relationship mix:

 

 

 

 

 

 

 

Sunrise Senior Living(2)

 

13%

 

13%

 

14%

 

Genesis HealthCare

 

17%

 

16%

 

9%

 

Revera(2)

 

5%

 

6%

 

7%

 

Brookdale Senior Living

 

7%

 

6%

 

7%

 

Benchmark Senior Living

 

4%

 

4%

 

4%

 

Remaining

 

54%

 

55%

 

59%

 

 

 

 

 

 

 

 

 

Geographic mix:

 

 

 

 

 

 

 

California

 

13%

 

10%

 

13%

 

United Kingdom

 

9%

 

8%

 

9%

 

New Jersey

 

8%

 

8%

 

8%

 

Canada

 

8%

 

7%

 

8%

 

Texas

 

7%

 

7%

 

7%

 

Remaining

 

55%

 

60%

 

55%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Excludes our share of investments in unconsolidated entities and non-segment/corporate NOI. Entities in which we have a joint venture with a minority partner are shown at 100% of the joint venture amount.

(2) Revera owns a controlling interest in Sunrise Senior Living. See Note 8 to our consolidated financial statements for additional information.

 

     We evaluate our key performance indicators in conjunction with current expectations to determine if historical trends are indicative of future results. Our expected results may not be achieved and actual results may differ materially from our expectations. Factors that may cause actual results to differ from expected results are described in more detail in “Item 1 — Business — Cautionary Statement Regarding Forward-Looking Statements” and “Item 1A — Risk Factors” and other sections of this Annual Report on Form 10-K. Management regularly monitors economic and other factors to develop strategic and tactical plans designed to improve performance and maximize our competitive position. Our ability to achieve our financial objectives is dependent upon our ability to effectively execute these plans and to appropriately respond to emerging economic and Company-specific trends. Please refer to “Item 1 — Business,” “Item 1A — Risk Factors” in this Annual Report on Form 10-K for further discussion of these risk factors.

Corporate Governance

     Maintaining investor confidence and trust is important in today’s business environment. Our Board of Directors and management are strongly committed to policies and procedures that reflect the highest level of ethical business practices. Our corporate governance guidelines provide the framework for our business operations and emphasize our commitment to increase stockholder value while meeting all applicable legal requirements. These guidelines meet the listing standards adopted by the New York Stock Exchange and are available on the Internet at www.welltower.com/investors/governance.  The information on our website is not incorporated by reference in this Annual Report on Form 10-K, and our web address is included as an inactive textual reference only.

Liquidity and Capital Resources

Sources and Uses of Cash

      During the fourth quarter of 2017, we adopted Accounting Standards Update (“ASU”) No. 2016-18, “Restricted Cash,” and ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments.”  See Note 2 to the consolidated financial statements for further information.

     Our primary sources of cash include rent and interest receipts, resident fees/services, borrowings under our primary unsecured credit facility, public issuances of debt and equity securities, proceeds from investment dispositions, and principal payments on loans receivable. Our primary uses of cash include dividend distributions, debt service payments (including principal and interest), real property investments (including acquisitions, capital expenditures, construction advances and transaction costs), loan advances, property operating expenses, and general and administrative expenses. These sources and uses of cash are reflected in our Consolidated Statements of Cash Flows and are discussed in further detail below.  The following is a summary of our sources and uses of cash flows for the periods presented (dollars in thousands):

  

32


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

Beginning cash, cash equivalents and restricted cash

 

$

553,423

 

$

422,690

 

$

(130,733)

 

-24%

 

$

607,220

 

$

184,530

 

44%

 

$

53,797

 

10%

Net cash provided from (used in):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Operating activities

 

 

1,382,599

 

 

1,639,064

 

 

256,465

 

19%

 

 

1,434,177

 

 

(204,887)

 

-13%

 

 

51,578

 

4%

   Investing activities

 

 

(3,502,075)

 

 

(183,443)

 

 

3,318,632

 

-95%

 

 

154,581

 

 

338,024

 

n/a

 

 

3,656,656

 

n/a

   Financing activities

 

 

1,997,318

 

 

(1,250,817)

 

 

(3,248,135)

 

n/a

 

 

(1,913,527)

 

 

(662,710)

 

53%

 

 

(3,910,845)

 

n/a

Effect of foreign currency translation

 

 

(8,575)

 

 

(20,274)

 

 

(11,699)

 

136%

 

 

26,852

 

 

47,126

 

n/a

 

 

35,427

 

n/a

Ending cash, cash equivalents and restricted cash

 

$

422,690

 

$

607,220

 

$

184,530

 

44%

 

$

309,303

 

$

(297,917)

 

-49%

 

$

(113,387)

 

-27%

 

     Operating Activities. The change in net cash provided from operating activities is attributable to changes in NOI, which is primarily due to dispositions in 2016 and 2017, partially offset by acquisitions and annual rent increasers.  Please see “Results of Operations” below for further discussion.  For the years ended December 31, 2015, 2016 and 2017, cash flows from operations exceeded cash distributions to stockholders.

Investing Activities.  The changes in net cash used in investing activities are primarily attributable to net changes in real property investments, real estate loans receivable, and investments in unconsolidated entities which are summarized above in “Key Transactions in 2017.”  Please refer to Notes 3, 6, and 7 of our consolidated financial statements for additional information.  The following is a summary of cash used in non-acquisition capital improvement activities for the periods presented (dollars in thousands):

  

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

New development

 

$

244,561

 

$

403,131

 

$

158,570

 

65%

 

$

232,715

 

$

(170,416)

 

-42%

 

$

(11,846)

 

-5%

Recurring capital expenditures, tenant improvements and lease commissions

 

 

64,458

 

 

66,332

 

 

1,874

 

3%

 

 

-

 

 

(66,332)

 

-100%

 

 

(64,458)

 

-100%

Renovations, redevelopments and other capital improvements

 

 

123,294

 

 

152,814

 

 

29,520

 

24%

 

 

250,276

 

 

97,462

 

64%

 

 

126,982

 

103%

Total

 

$

432,313

 

$

622,277

 

$

189,964

 

44%

 

$

482,991

 

$

(139,286)

 

-22%

 

$

50,678

 

12%

 

     The change in new development is primarily due to the number and size of construction projects on-going during the relevant periods.  Renovations, redevelopments and other capital improvements include expenditures to maximize property value, increase net operating income, maintain a market-competitive position, and/or achieve property stabilization.  Generally, these expenditures have increased as a result of acquisitions, primarily in our seniors housing operating segment.

     Financing Activities. The changes in net cash provided from financing activities are primarily attributable to changes related to our long-term debt arrangements, the issuance/redemptions of common and preferred stock, and dividend payments which are summarized above in “Key Transactions in 2017.”  Please refer to Notes 9, 10 and 13 of our consolidated financial statements for additional information.

 

Off-Balance Sheet Arrangements

     At December 31, 2017, we had investments in unconsolidated entities with our ownership generally ranging from 10% to 50%. Please see Note 7 to our consolidated financial statements for additional information.  We use financial derivative instruments to hedge interest rate and foreign currency exchange rate exposure. Please see Note 11 to our consolidated financial statements for additional information.  At December 31, 2017, we had fourteen outstanding letter of credit obligations. Please see Note 12 to our consolidated financial statements for additional information.

Contractual Obligations

     The following table summarizes our payment requirements under contractual obligations as of December 31, 2017 (in thousands):

  

33


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

 

Payments Due by Period

Contractual Obligations

 

Total

 

2018

 

2019-2020

 

2021-2022

 

Thereafter

Unsecured revolving credit facility(1)

 

$

719,000

 

$

-

 

$

-

 

$

719,000

 

$

-

Senior unsecured notes and term credit facilities:(2)

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     U.S. Dollar senior unsecured notes

 

 

6,050,000

 

 

450,000

 

 

1,050,000

 

 

1,050,000

 

 

3,500,000

     Canadian Dollar senior unsecured notes(3)

 

 

239,674

 

 

-

 

 

239,674

 

 

-

 

 

-

     Pounds Sterling senior unsecured notes(3)

 

 

1,420,545

 

 

-

 

 

-

 

 

-

 

 

1,420,545

     U.S. Dollar term credit facility

 

 

507,500

 

 

-

 

 

7,500

 

 

500,000

 

 

-

     Canadian Dollar term credit facility(3)

 

 

199,728

 

 

-

 

 

-

 

 

199,728

 

 

-

Secured debt:(2,3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Consolidated

 

 

2,618,408

 

 

396,588

 

 

707,184

 

 

456,634

 

 

1,058,002

     Unconsolidated  

 

 

753,807

 

 

31,087

 

 

133,312

 

 

36,628

 

 

552,780

Contractual interest obligations:(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Unsecured revolving credit facility

 

 

80,485

 

 

20,121

 

 

40,243

 

 

20,121

 

 

-

     Senior unsecured notes and term loans(3)

 

 

3,124,832

 

 

359,943

 

 

665,295

 

 

510,717

 

 

1,588,877

     Consolidated secured debt(3)

 

 

502,477

 

 

96,372

 

 

145,563

 

 

101,972

 

 

158,570

     Unconsolidated secured debt(3)

 

 

194,923

 

 

28,840

 

 

51,220

 

 

41,856

 

 

73,007

Capital lease obligations(5)

 

 

89,104

 

 

4,678

 

 

8,507

 

 

8,346

 

 

67,573

Operating lease obligations(5)

 

 

1,125,098

 

 

17,871

 

 

35,675

 

 

34,184

 

 

1,037,368

Purchase obligations(5)

 

 

441,647

 

 

304,188

 

 

137,459

 

 

-

 

 

-

Other long-term liabilities(6)

 

 

2,704

 

 

1,475

 

 

1,229

 

 

-

 

 

-

Total contractual obligations

 

$

18,069,932

 

$

1,711,163

 

$

3,222,861

 

$

3,679,186

 

$

9,456,722

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Relates to our unsecured revolving credit facility with an aggregate commitment of $3,000,000,000. See Note 9 to our consolidated financial statements.

(2) Amounts represent principal amounts due and do not reflect unamortized premiums/discounts or other fair value adjustments as reflected on the balance sheet.

(3) Based on foreign currency exchange rates in effect as of balance sheet date.

(4) Based on variable interest rates in effect as of December 31, 2017.

(5) See Note 12 to our consolidated financial statements.

(6) Primarily relates to payments to be made under a supplemental executive retirement plan for one former executive officer.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Structure

     Please refer to “Credit Strength” above for our leverage and coverage ratio trends.  Our debt agreements contain various covenants, restrictions and events of default. Certain agreements require us to maintain financial ratios and minimum net worth and impose certain limits on our ability to incur indebtedness, create liens and make investments or acquisitions. As of December 31, 2017, we believe we were in compliance with all of the covenants under our debt agreements. None of our debt agreements contain provisions for acceleration which could be triggered by our debt ratings. However, under our primary unsecured credit facility, the ratings on our senior unsecured notes are used to determine the fees and interest charged.  We plan to manage the Company to maintain compliance with our debt covenants and with a capital structure consistent with our current profile. Any downgrades in terms of ratings or outlook by any or all of the rating agencies could have a material adverse impact on our cost and availability of capital, which could in turn have a material adverse impact on our consolidated results of operations, liquidity and/or financial condition.

     On May 1, 2015, we filed with the Securities and Exchange Commission (“SEC”) (1) an open-ended automatic or “universal” shelf registration statement covering an indeterminate amount of future offerings of debt securities, common stock, preferred stock, depositary shares, warrants and units and (2) a registration statement in connection with our enhanced dividend reinvestment plan (“DRIP”) under which we may issue up to 15,000,000 shares of common stock. As of January 31, 2018, 2,108,286 shares of common stock remained available for issuance under the DRIP registration statement. We have entered into separate Equity Distribution Agreements with each of Morgan Stanley & Co. LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman Sachs & Co. LLC, UBS Securities LLC and Wells Fargo Securities, LLC relating to the offer and sale from time to time of up to $1,000,000,000 aggregate amount of our common stock (“Equity Shelf Program”).  The Equity Shelf Program also allows us to enter into forward sale agreements.  We expect that, if entered into, we will physically settle each forward sale agreement on one or more dates on or prior to the maturity date of that particular forward sale agreement, in which case we will expect to receive per share cash proceeds at settlement equal to the forward sale price under the relevant forward sale agreement.  However, we may elect to cash settle or net share settle a forward share agreement.  As of January 31, 2018, we had $784,083,000 of remaining capacity under the Equity Shelf Program and there were no outstanding forward sales agreements. Depending upon market conditions, we anticipate issuing securities under our registration statements to invest in additional properties and to repay borrowings under our primary unsecured credit facility.

Results of Operations

 

Summary

     Our primary sources of revenue include rent, resident fees/services, and interest income. Our primary expenses include interest

34


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

expense, depreciation and amortization, property operating expenses, other expenses, and general and administrative expenses.  We evaluate our business and make resource allocations on our three business segments: triple-net, seniors housing operating and outpatient medical.  The primary performance measures for our properties are NOI and SSNOI and other supplemental measures include FFO and AEBITDA, which are further discussed below.  Please see Non-GAAP Financial Measures for additional information and reconciliations.  The following is a summary of our results of operations for the periods presented (dollars in thousands, except per share amounts):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

Amount

 

%

 

2017

 

Amount

 

%

 

Amount

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to common stockholders

 

$

818,344

 

$

1,012,397

 

$

194,053

 

24%

 

$

463,595

 

$

(548,802)

 

-54%

 

$

(354,749)

 

-43%

Net income

 

 

888,549

 

 

1,082,070

 

 

193,521

 

22%

 

 

540,613

 

 

(541,457)

 

-50%

 

 

(347,936)

 

-39%

Funds from operations attributable to common stockholders

 

 

1,409,640

 

 

1,582,940

 

 

173,300

 

12%

 

 

1,165,576

 

 

(417,364)

 

-26%

 

 

(244,064)

 

-17%

Adjusted EBITDA

 

 

2,113,258

 

 

2,256,864

 

 

143,606

 

7%

 

 

2,128,429

 

 

(128,435)

 

-6%

 

 

15,171

 

1%

Consolidated NOI

 

 

2,237,569

 

 

2,404,177

 

 

166,608

 

7%

 

 

2,232,716

 

 

(171,461)

 

-7%

 

 

(4,853)

 

0%

Same store NOI

 

 

1,523,666

 

 

1,499,511

 

 

(24,155)

 

-2%

 

 

1,519,193

 

 

19,682

 

1%

 

 

(4,473)

 

0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share data (fully diluted):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to common stockholders

 

$

2.34

 

$

2.81

 

$

0.47

 

20%

 

$

1.26

 

$

(1.55)

 

-55%

 

$

(1.08)

 

-46%

 

Funds from operations attributable to common stockholders

 

 

4.03

 

 

4.39

 

 

0.36

 

9%

 

 

3.16

 

 

(1.23)

 

-28%

 

 

(0.87)

 

-22%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted interest coverage ratio

 

 

4.24x

 

 

4.21x

 

 

-0.03x

 

-1%

 

 

4.36x

 

 

0.15x

 

4%

 

 

0.12x

 

3%

Adjusted fixed charge coverage ratio

 

 

3.35x

 

 

3.34x

 

 

-0.01x

 

0%

 

 

3.54x

 

 

0.20x

 

6%

 

 

0.19x

 

6%

 

     The following table represents the changes in outstanding common stock for the period from January 1, 2015 to December 31, 2017 (in thousands):

 

 

 

Year Ended

 

 

 

 

 

December 31, 2015

 

December 31, 2016

 

December 31, 2017

 

Totals

Beginning balance

 

328,790

 

354,778

 

362,602

 

328,790

Public offerings

 

19,550

 

-

 

-

 

19,550

Dividend reinvestment plan issuances

 

4,024

 

4,145

 

5,640

 

13,809

Senior note conversions

 

1,330

 

-

 

-

 

1,330

Preferred stock conversions

 

-

 

-

 

4

 

4

Redemption of equity membership units

 

-

 

-

 

91

 

91

Option exercises

 

249

 

141

 

253

 

643

Equity Shelf Program issuances

 

696

 

3,135

 

2,987

 

6,818

Other, net

 

139

 

403

 

155

 

697

Ending balance

 

354,778

 

362,602

 

371,732

 

371,732

 

 

 

 

 

 

 

 

 

 

Average number of shares outstanding:

 

 

 

 

 

 

 

Basic

 

348,240

 

358,275

 

367,237

 

 

 

Diluted

 

349,424

 

360,227

 

369,001

 

 

 

     During the past three years, inflation has not significantly affected our earnings because of the moderate inflation rate. Additionally, a portion of our earnings are derived primarily from long-term investments with predictable rates of return. These investments are mainly financed with a combination of equity, senior unsecured notes, secured debt, and borrowings under our primary unsecured credit facility. During inflationary periods, which generally are accompanied by rising interest rates, our ability to grow may be adversely affected because the yield on new investments may increase at a slower rate than new borrowing costs. Presuming the current inflation rate remains moderate and long-term interest rates do not increase significantly, we believe that inflation will not impact the availability of equity and debt financing for us.

Triple-net

 

     The following is a summary of our NOI and SSNOI for the triple-net segment for the periods presented (dollars in thousands):

  

35


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

NOI

 

 $ 

1,175,806

 

 $ 

1,208,860

 

 $ 

33,054

 

3%

 

 $ 

967,084

 

 $ 

(241,776)

 

-20%

 

 $ 

(208,722)

 

-18%

Non-cash NOI attributable to same store properties(1)

 

 

(48,890)

 

 

(38,899)

 

 

9,991

 

-20%

 

 

(28,602)

 

 

10,297

 

-26%

 

 

20,288

 

-41%

NOI attributable to non same store properties(2)

 

 

(498,131)

 

 

(574,049)

 

 

(75,918)

 

15%

 

 

(333,279)

 

 

240,770

 

-42%

 

 

164,852

 

-33%

SSNOI(1)

 

 $ 

628,785

 

 $ 

595,912

 

 $ 

(32,873)

 

-5%

 

 $ 

605,203

 

 $ 

9,291

 

2%

 

 $ 

(23,582)

 

-4%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Relates to 418 same store properties.

(2) Primarily relates to the acquisition of 74 properties and the conversion of 17 construction projects into revenue-generating properties subsequent to January 1, 2015 as well as 48 properties sold or held for sale at December 31, 2017.

 

    The following is a summary of our results of operations for the triple-net segment for the periods presented (dollars in thousands):

  

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental income

 

$

1,094,827

 

 $ 

1,112,325

 

 $ 

17,498

 

2%

 

 $ 

885,811

 

 $ 

(226,514)

 

-20%

 

 $ 

(209,016)

 

-19%

 

Interest income

 

 

74,108

 

 

90,476

 

 

16,368

 

22%

 

 

73,742

 

 

(16,734)

 

-18%

 

 

(366)

 

0%

 

Other income

 

 

6,871

 

 

6,059

 

 

(812)

 

-12%

 

 

7,531

 

 

1,472

 

24%

 

 

660

 

10%

 

 

 

 

 

1,175,806

 

 

1,208,860

 

 

33,054

 

3%

 

 

967,084

 

 

(241,776)

 

-20%

 

 

(208,722)

 

-18%

 

NOI(1)

 

 

1,175,806

 

 

1,208,860

 

 

33,054

 

3%

 

 

967,084

 

 

(241,776)

 

-20%

 

 

(208,722)

 

-18%

Other expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

28,384

 

 

21,370

 

 

(7,014)

 

-25%

 

 

15,194

 

 

(6,176)

 

-29%

 

 

(13,190)

 

-46%

 

Loss (gain) on derivatives, net

 

 

(58,427)

 

 

68

 

 

58,495

 

n/a

 

 

2,284

 

 

2,216

 

3259%

 

 

60,711

 

-104%

 

Depreciation and amortization

 

 

288,242

 

 

297,197

 

 

8,955

 

3%

 

 

243,830

 

 

(53,367)

 

-18%

 

 

(44,412)

 

-15%

 

Transaction costs(2)

 

 

53,195

 

 

10,016

 

 

(43,179)

 

-81%

 

 

-

 

 

(10,016)

 

-100%

 

 

(53,195)

 

-100%

 

Loss (gain) on extinguishment of debt, net

 

 

10,095

 

 

863

 

 

(9,232)

 

-91%

 

 

29,083

 

 

28,220

 

3270%

 

 

18,988

 

188%

 

Provision for loan losses(3)

 

 

-

 

 

6,935

 

 

6,935

 

n/a

 

 

62,966

 

 

56,031

 

808%

 

 

62,966

 

n/a

 

Impairment of assets(4)

 

 

2,220

 

 

20,169

 

 

17,949

 

809%

 

 

96,909

 

 

76,740

 

380%

 

 

94,689

 

4265%

 

Other expenses(2)

 

 

35,648

 

 

-

 

 

(35,648)

 

-100%

 

 

116,689

 

 

116,689

 

n/a

 

 

81,041

 

227%

 

 

 

 

 

359,357

 

 

356,618

 

 

(2,739)

 

-1%

 

 

566,955

 

 

210,337

 

59%

 

 

207,598

 

58%

Income from continuing operations before income taxes and income (loss) from unconsolidated entities

 

 

816,449

 

 

852,242

 

 

35,793

 

4%

 

 

400,129

 

 

(452,113)

 

-53%

 

 

(416,320)

 

-51%

Income tax benefit (expense)

 

 

(4,244)

 

 

(1,087)

 

 

3,157

 

-74%

 

 

(4,291)

 

 

(3,204)

 

295%

 

 

(47)

 

1%

Income (loss) from unconsolidated entities

 

 

8,260

 

 

9,767

 

 

1,507

 

18%

 

 

19,428

 

 

9,661

 

99%

 

 

11,168

 

135%

Income from continuing operations

 

 

820,465

 

 

860,922

 

 

40,457

 

5%

 

 

415,266

 

 

(445,656)

 

-52%

 

 

(405,199)

 

-49%

Gain (loss) on real estate dispositions, net(4)

 

 

86,261

 

 

355,394

 

 

269,133

 

312%

 

 

286,325

 

 

(69,069)

 

-19%

 

 

200,064

 

232%

Net income

 

 

906,726

 

 

1,216,316

 

 

309,590

 

34%

 

 

701,591

 

 

(514,725)

 

-42%

 

 

(205,135)

 

-23%

Less: Net income attributable to noncontrolling interests

 

 

6,348

 

 

1,221

 

 

(5,127)

 

-81%

 

 

4,603

 

 

3,382

 

277%

 

 

(1,745)

 

-27%

Net income attributable to common stockholders

 

$

900,378

 

$

1,215,095

 

$

314,717

 

35%

 

$

696,988

 

$

(518,107)

 

-43%

 

$

(203,390)

 

-23%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) See Non-GAAP Financial Measures below.

(2) See Note 3 to our consolidated financial statements.

(3) See Note 6 to our consolidated financial statements.

(4) See Note 5 to our consolidated financial statements.

 

The 2017 decrease in rental income is primarily attributable to the disposition of properties exceeding new acquisitions and conversions of newly constructed triple-net properties. Certain of our leases contain annual rental escalators that are contingent upon changes in the Consumer Price Index (“CPI”) and/or changes in the gross operating revenues of the tenant’s properties.  These escalators are not fixed, so no straight-line rent is recorded; however, rental income is recorded based on the contractual cash rental payments due for the period.  If gross operating revenues at our facilities and/or the CPI do not increase, a portion of our revenues may not continue to increase.  Our leases could renew above or below current rent rates, resulting in an increase or decrease in rental income.  For the three months ended December 31, 2017, we had no triple-net lease renewals but we had 25 leases with rental rate increasers ranging from 0.15% to 0.36% in our triple-net portfolio. The 2017 decrease in interest income is primarily attributable to the volume of loan payoffs during 2016 and 2017 and the 2016 increase is attributable to higher loan volumes during the majority of 2016.

36


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

During the year ended December 31, 2017, we completed seven triple-net construction projects totaling $283,472,000 or $347,818 per bed/unit and two expansion projects totaling $10,336,000. The following is a summary of triple-net construction projects pending as of December 31, 2017 (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

Location

 

Units/Beds

 

 

Commitment

 

 

Balance

 

Est. Completion

Alexandria,VA

 

116

 

$

60,156

 

$

46,631

 

2Q18

Exton, PA

 

120

 

 

34,175

 

 

18,560

 

2Q18

Westerville, OH

 

90

 

 

22,800

 

 

3,595

 

4Q18

Total

 

326

 

$

117,131

 

$

68,786

 

 

 

     Total interest expense represents secured debt interest expense and related fees.  The change in secured debt interest expense is due to the net effect and timing of assumptions, segment transitions, fluctuations in foreign currency rates, extinguishments and principal amortizations. The fluctuations in loss (gain) on extinguishment of debt is primarily attributable to the volume of extinguishments and terms of the related secured debt. The following is a summary of our triple-net secured debt principal activity for the periods presented (dollars in thousands):

 

 

Year Ended

 

Year Ended

 

Year Ended

 

 

December 31, 2015

 

December 31, 2016

 

December 31, 2017

 

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

Beginning balance

 

$

670,769

 

5.337%

 

$

554,014

 

5.488%

 

$

594,199

 

4.580%

Debt issued

 

 

-

 

0.000%

 

 

166,155

 

2.205%

 

 

13,000

 

4.570%

Debt assumed

 

 

44,142

 

5.046%

 

 

-

 

0.000%

 

 

-

 

0.000%

Debt extinguished

 

 

(132,545)

 

4.695%

 

 

(118,500)

 

5.562%

 

 

(274,048)

 

5.954%

Foreign currency

 

 

(15,633)

 

5.315%

 

 

3,157

 

5.247%

 

 

20,186

 

2.909%

Principal payments

 

 

(12,719)

 

5.450%

 

 

(10,627)

 

5.682%

 

 

(5,863)

 

5.657%

Ending balance

 

$

554,014

 

5.488%

 

$

594,199

 

4.580%

 

$

347,474

 

3.546%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Monthly averages

 

$

551,803

 

5.518%

 

$

497,213

 

5.414%

 

$

408,688

 

3.909%

 

Depreciation and amortization decreased in 2017 primarily as a result of the disposition of triple-net properties. To the extent that we acquire or dispose of additional properties in the future, our provision for depreciation and amortization will change accordingly.  Changes in gains on sales of properties are related to the volume of property sales and the sales prices.  During the years ended December 31, 2017, 2016 and 2015, we recorded impairment charges totaling $96,909,000 related to 21 properties, $20,169,000 related to 22 properties, and $2,220,000 related to two properties, respectively. 

The provision for loan losses is related to our critical accounting estimate for the allowance for loan losses and is discussed in “Critical Accounting Policies” below and Note 6 to our consolidated financial statements.  During the years ended December 31, 2017 and 2016, we recorded provision for loan losses related to certain first mortgage loans to Genesis HealthCare (“Genesis”) of $62,966,000 and $6,935,000, respectively.

During the year ended December 31, 2017, other expenses primarily represents non-capitalizable transaction costs, including $88,316,000 related to a joint venture transaction with an existing seniors housing operator, including the conversion of properties from triple-net to seniors housing operating, an exchange of PropCo/OpCo interests and termination/restructuring of pre-existing relationships.

In April 2011, we completed the acquisition of substantially all of the real estate assets of privately-owned Genesis.  In conjunction with this transaction, we received the option to acquire an ownership interest in Genesis.  In February 2015, Genesis closed on a transaction to merge with Skilled Healthcare Group to become a publicly traded company which required us to record the value of the derivative asset due to the net settlement feature.  This event resulted in $58,427,000 gain. During the fourth quarter of 2015, the cost basis of this investment exceeded the fair value.  Management performed an assessment to determine whether the decline in fair value was other than temporary and concluded that it was.  As a result, we recognized an other than temporary impairment charge of $35,648,000 which was recorded in other expense.  During the fourth quarter of 2017, management recorded an additional other than temporary charge of $18,294,000 in other expenses on the Genesis equity investment.

A portion of our triple-net properties were formed through partnerships.  Income or loss from unconsolidated entities represents our share of net income or losses from partnerships where we are the noncontrolling partner.  Net income attributable to noncontrolling interests represents our partners’ share of net income relating to those partnerships where we are the controlling partner.

 

37


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

Seniors Housing Operating

 

     The following is a summary of our NOI and SSNOI for the seniors housing operating segment for the periods presented (dollars in thousands):

 

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

NOI

 

 $ 

701,262

 

 $ 

814,114

 

 $ 

112,852

 

16%

 

 $ 

880,026

 

 $ 

65,912

 

8%

 

 $ 

178,764

 

25%

Non-cash NOI attributable to same store properties(1)

 

 

1,003

 

 

1,990

 

 

987

 

98%

 

 

1,242

 

 

(748)

 

-38%

 

 

239

 

24%

NOI attributable to non same store properties(2)

 

 

(83,880)

 

 

(190,459)

 

 

(106,579)

 

127%

 

 

(246,731)

 

 

(56,272)

 

30%

 

 

(162,851)

 

194%

SSNOI(1)

 

 $ 

618,385

 

 $ 

625,645

 

 $ 

7,260

 

1%

 

 $ 

634,537

 

 $ 

8,892

 

1%

 

 $ 

16,152

 

3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Relates to 294 same store properties.

(2) Primarily relates to the acquisition of 129 properties subsequent to January 1, 2015.

 

The following is a summary of our results of operations for the seniors housing operating segment for the periods presented (dollars in thousands):

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Resident fees and services

 

$

2,158,031

 

$

2,504,731

 

$

346,700

 

16%

 

$

2,779,423

 

$

274,692

 

11%

 

$

621,392

 

29%

 

Interest income

 

 

4,180

 

 

4,180

 

 

-

 

0%

 

 

69

 

 

(4,111)

 

-98%

 

 

(4,111)

 

-98%

 

Other income

 

 

6,060

 

 

17,085

 

 

11,025

 

182%

 

 

5,127

 

 

(11,958)

 

-70%

 

 

(933)

 

-15%

 

 

 

 

 

2,168,271

 

 

2,525,996

 

 

357,725

 

16%

 

 

2,784,619

 

 

258,623

 

10%

 

 

616,348

 

28%

Property operating expenses

 

 

1,467,009

 

 

1,711,882

 

 

244,873

 

17%

 

 

1,904,593

 

 

192,711

 

11%

 

 

437,584

 

30%

 

NOI(1)

 

 

701,262

 

 

814,114

 

 

112,852

 

16%

 

 

880,026

 

 

65,912

 

8%

 

 

178,764

 

25%

Other expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

70,388

 

 

81,853

 

 

11,465

 

16%

 

 

63,265

 

 

(18,588)

 

-23%

 

 

(7,123)

 

-10%

 

Depreciation and amortization

 

 

351,733

 

 

415,429

 

 

63,696

 

18%

 

 

484,796

 

 

69,367

 

17%

 

 

133,063

 

38%

 

Transaction costs(2)

 

 

54,966

 

 

29,207

 

 

(25,759)

 

-47%

 

 

-

 

 

(29,207)

 

-100%

 

 

(54,966)

 

-100%

 

Loss (gain) on extinguishment of debt, net

 

 

(195)

 

 

(88)

 

 

107

 

-55%

 

 

3,785

 

 

3,873

 

-4401%

 

 

3,980

 

-2041%

 

Impairment of assets(3)

 

 

-

 

 

12,403

 

 

12,403

 

n/a

 

 

21,949

 

 

9,546

 

77%

 

 

21,949

 

n/a

 

Other expenses(2)

 

 

-

 

 

-

 

 

-

 

n/a

 

 

8,347

 

 

8,347

 

n/a

 

 

8,347

 

n/a

 

 

 

 

 

476,892

 

 

538,804

 

 

61,912

 

13%

 

 

582,142

 

 

43,338

 

8%

 

 

105,250

 

22%

Income (loss) from continuing operations before income from unconsolidated entities

 

 

224,370

 

 

275,310

 

 

50,940

 

23%

 

 

297,884

 

 

22,574

 

8%

 

 

73,514

 

33%

Income tax benefit (expense)

 

 

986

 

 

(3,762)

 

 

(4,748)

 

-482%

 

 

(16,430)

 

 

(12,668)

 

337%

 

 

(17,416)

 

-1766%

Income (loss) from unconsolidated entities

 

 

(32,672)

 

 

(20,442)

 

 

12,230

 

-37%

 

 

(105,236)

 

 

(84,794)

 

415%

 

 

(72,564)

 

222%

Income from continuing operations

 

 

192,684

 

 

251,106

 

 

58,422

 

30%

 

 

176,218

 

 

(74,888)

 

-30%

 

 

(16,466)

 

-9%

Gain (loss) on real estate dispositions, net(3)

 

 

-

 

 

9,880

 

 

9,880

 

n/a

 

 

56,295

 

 

46,415

 

470%

 

 

56,295

 

n/a

Net income (loss)

 

 

192,684

 

 

260,986

 

 

68,302

 

35%

 

 

232,513

 

 

(28,473)

 

-11%

 

 

39,829

 

21%

Less: Net income (loss) attributable to noncontrolling interests

 

 

(1,438)

 

 

2,292

 

 

3,730

 

-259%

 

 

8,472

 

 

6,180

 

270%

 

 

9,910

 

-689%

Net income (loss) attributable to common stockholders

 

$

194,122

 

$

258,694

 

$

64,572

 

33%

 

$

224,041

 

$

(34,653)

 

-13%

 

$

29,919

 

15%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) See Non-GAAP Financial Measures below.

(2) See Note 3 to our consolidated financial statements.

(3) See Note 5 to our consolidated financial statements.

 

      Fluctuations in resident fees/services and property operating expenses are primarily a result of acquisitions and the movement of U.S. and foreign currency exchange rates. The fluctuations in depreciation and amortization are due to acquisitions and variations in amortization of short-lived intangible assets. To the extent that we acquire or dispose of additional properties in the future, these amounts will change accordingly. The increase in other income for the year ended December 31, 2016 is primarily a result of insurance proceeds received relating to a property as well as a bargain purchase gain recognized in conjunction with a single property acquisition. 

    The majority of our seniors housing operating properties are formed through partnership interests.  The fluctuations in income (loss) from unconsolidated entities are largely due to the recognition of impairments related to one of our investments in unconsolidated

38


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

entities during the year ended December 31, 2017. In addition, losses are also attributable to depreciation and amortization of short-lived intangible assets related to certain investments in unconsolidated joint ventures in 2013 and 2014.   Net income attributable to noncontrolling interests represents our partners’ share of net income (loss) related to joint ventures.

     During the year ended December 31, 2017, we completed one seniors housing operating construction project representing $3,634,000 or $302,820 per unit.  The following is a summary of our seniors housing operating construction projects, excluding expansions, pending as of December 31, 2017 (dollars in thousands):

  

Location

 

Units/Beds

 

 

Commitment

 

 

Balance

 

Est. Completion

Chertsey, UK

 

94

 

$

42,210

 

$

35,814

 

1Q18

Bushey, UK

 

95

 

 

55,131

 

 

36,784

 

3Q18

Wandsworth, UK

 

98

 

 

78,739

 

 

29,502

 

1Q20

Total

 

287

 

$

176,080

 

 

102,100

 

 

 

      Interest expense represents secured debt interest expense which fluctuates based on the net effect and timing of assumptions, segment transitions, fluctuations in foreign currency rates, extinguishments and principal amortizations. The fluctuations in loss (gain) on extinguishment of debt is primarily attributable the volume of extinguishments and terms of the related secured debt.  The following is a summary of our seniors housing operating property secured debt principal activity (dollars in thousands):

 

 

 

Year Ended

 

 

Year Ended

 

Year Ended

 

 

December 31, 2015

 

 

December 31, 2016

 

December 31, 2017

 

 

 

 

 

Weighted Avg.

 

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

Amount

 

Interest Rate

 

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

Beginning balance

 

$

1,654,531

 

4.422%

 

 

$

2,290,552

 

3.958%

 

$

2,463,249

 

3.936%

Debt issued

 

 

228,685

 

2.776%

 

 

 

293,860

 

2.895%

 

 

228,772

 

2.722%

Debt assumed

 

 

842,316

 

3.420%

 

 

 

60,898

 

4.301%

 

 

-

 

0.000%

Debt extinguished

 

 

(285,599)

 

4.188%

 

 

 

(159,498)

 

3.656%

 

 

(668,804)

 

4.805%

Debt deconsolidated

 

 

-

 

0.000%

 

 

 

-

 

0.000%

 

 

(60,000)

 

3.799%

Foreign currency

 

 

(110,691)

 

3.625%

 

 

 

26,549

 

3.483%

 

 

72,636

 

3.234%

Principal payments

 

 

(38,690)

 

4.126%

 

 

 

(49,112)

 

3.888%

 

 

(47,153)

 

3.601%

Ending balance

 

$

2,290,552

 

3.958%

 

 

$

2,463,249

 

3.936%

 

$

1,988,700

 

3.661%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Monthly averages

 

$

1,894,609

 

4.261%

 

 

$

2,391,706

 

3.926%

 

$

2,065,477

 

3.662%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     The increases in gains on real estate dispositions is due to higher volumes of property sales. During the years ended December 31, 2017, and 2016, we recorded impairment charges totaling $21,949,000 and $12,403,000, relating to three and two properties, respectively.

 

Outpatient Medical

 

     The following is a summary of our NOI and SSNOI for the outpatient medical segment for the periods presented (dollars in thousands):

  

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

NOI(1)

 

 $ 

359,410

 

 $ 

380,264

 

 $ 

20,854

 

6%

 

 $ 

384,068

 

 $ 

3,804

 

1%

 

 $ 

24,658

 

7%

Non-cash NOI attributable to same store properties(1)

 

 

(6,095)

 

 

(3,073)

 

 

3,022

 

-50%

 

 

(1,764)

 

 

1,309

 

-43%

 

 

4,331

 

-71%

NOI attributable to non same store properties(2)

 

 

(76,819)

 

 

(99,237)

 

 

(22,418)

 

29%

 

 

(102,851)

 

 

(3,614)

 

4%

 

 

(26,032)

 

34%

SSNOI(1)

 

 $ 

276,496

 

 $ 

277,954

 

 $ 

1,458

 

1%

 

 $ 

279,453

 

 $ 

1,499

 

1%

 

 $ 

2,957

 

1%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Relates to 202 same store properties.

(2) Primarily relates to the acquisition of 28 properties and the conversion of 12 construction projects into revenue-generating properties subsequent to January 1, 2015 as well as 20 properties sold or held for sale at Dcember 31, 2017.

 

The following is a summary of our results of operations for the outpatient medical segment for the periods presented (dollars in thousands):

39


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental income

 

$

504,121

 

$

536,490

 

$

32,369

 

6%

 

$

560,060

 

$

23,570

 

4%

 

$

55,939

 

11%

 

Interest income

 

 

5,853

 

 

3,307

 

 

(2,546)

 

-43%

 

 

-

 

 

(3,307)

 

-100%

 

 

(5,853)

 

-100%

 

Other income

 

 

4,684

 

 

5,568

 

 

884

 

19%

 

 

3,340

 

 

(2,228)

 

-40%

 

 

(1,344)

 

-29%

 

 

 

 

 

514,658

 

 

545,365

 

 

30,707

 

6%

 

 

563,400

 

 

18,035

 

3%

 

 

48,742

 

9%

Property operating expenses

 

 

155,248

 

 

165,101

 

 

9,853

 

6%

 

 

179,332

 

 

14,231

 

9%

 

 

24,084

 

16%

 

NOI(1)

 

 

359,410

 

 

380,264

 

 

20,854

 

6%

 

 

384,068

 

 

3,804

 

1%

 

 

24,658

 

7%

Other expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

27,542

 

 

19,087

 

 

(8,455)

 

-31%

 

 

10,015

 

 

(9,072)

 

-48%

 

 

(17,527)

 

-64%

 

Depreciation and amortization

 

 

186,265

 

 

188,616

 

 

2,351

 

1%

 

 

193,094

 

 

4,478

 

2%

 

 

6,829

 

4%

 

Transaction costs(2)

 

 

2,765

 

 

3,687

 

 

922

 

33%

 

 

-

 

 

(3,687)

 

-100%

 

 

(2,765)

 

-100%

 

Loss (gain) on extinguishment of debt, net

 

 

-

 

 

-

 

 

-

 

n/a

 

 

4,373

 

 

4,373

 

n/a

 

 

4,373

 

n/a

 

Provision for loan losses(3)

 

 

-

 

 

3,280

 

 

3,280

 

n/a

 

 

-

 

 

(3,280)

 

-100%

 

 

-

 

n/a

 

Impairment of assets(4)

 

 

-

 

 

4,635

 

 

4,635

 

n/a

 

 

5,625

 

 

990

 

21%

 

 

5,625

 

n/a

 

Other expenses(2)

 

 

-

 

 

-

 

 

-

 

n/a

 

 

1,911

 

 

1,911

 

n/a

 

 

1,911

 

n/a

 

 

 

 

 

216,572

 

 

219,305

 

 

2,733

 

1%

 

 

215,018

 

 

(4,287)

 

-2%

 

 

(1,554)

 

-1%

Income from continuing operations before income taxes and income (loss)  from unconsolidated entities

 

 

142,838

 

 

160,959

 

 

18,121

 

13%

 

 

169,050

 

 

8,091

 

5%

 

 

26,212

 

18%

Income tax benefit (expense)

 

 

245

 

 

(511)

 

 

(756)

 

n/a

 

 

(1,477)

 

 

(966)

 

189%

 

 

(1,722)

 

n/a

Income (loss) from unconsolidated entities

 

 

2,908

 

 

318

 

 

(2,590)

 

-89%

 

 

2,683

 

 

2,365

 

744%

 

 

(225)

 

-8%

Income from continuing operations

 

 

145,991

 

 

160,766

 

 

14,775

 

10%

 

 

170,256

 

 

9,490

 

6%

 

 

24,265

 

17%

Gain (loss) on real estate dispositions, net(4)

 

 

194,126

 

 

(1,228)

 

 

(195,354)

 

n/a

 

 

1,630

 

 

2,858

 

n/a

 

 

(192,496)

 

-99%

Net income (loss)

 

 

340,117

 

 

159,538

 

 

(180,579)

 

-53%

 

 

171,886

 

 

12,348

 

8%

 

 

(168,231)

 

-49%

Less: Net income (loss) attributable to noncontrolling interests

 

 

(110)

 

 

768

 

 

878

 

n/a

 

 

4,765

 

 

3,997

 

520%

 

 

4,875

 

n/a

Net income (loss) attributable to common stockholders

 

$

340,227

 

$

158,770

 

$

(181,457)

 

-53%

 

$

167,121

 

$

8,351

 

5%

 

$

(173,106)

 

-51%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) See Non-GAAP Financial Measures below.

(2) See Note 3 to our consolidated financial statements.

(3) See Note 6 to our consolidated financial statements.

(3) See Note 5 to our consolidated financial statements.

 

The increases in rental income is primarily attributable to the acquisitions of new properties and the conversion of newly constructed outpatient medical properties from which we receive rent. Certain of our leases contain annual rental escalators that are contingent upon changes in the CPI.  These escalators are not fixed, so no straight-line rent is recorded; however, rental income is recorded based on the contractual cash rental payments due for the period.  If the CPI does not increase, a portion of our revenues may not continue to increase.  Revenue from real property that is sold would offset revenue increases and, to the extent that revenues from sold properties exceed those from new acquisitions, we would experience decreased revenues.  Our leases could renew above or below current rent rates, resulting in an increase or decrease in rental income.  For the three months ended December 31, 2017, our consolidated outpatient medical portfolio signed 79,129 square feet of new leases and 270,505 square feet of renewals.  The weighted-average term of these leases was six years, with a rate of $32.92 per square foot and tenant improvement and lease commission costs of $11.43 per square foot.  Substantially all of these leases during the referenced quarter contain an annual fixed or contingent escalation rent structure ranging from the change in CPI to 3.5%.   

The fluctuation in property operating expenses is primarily attributable to acquisitions and construction conversions of new outpatient medical facilities for which we incur certain property operating expenses.  The fluctuations in depreciation and amortization are due to acquisitions and variations in amortization of short-lived intangible assets. To the extent that we acquire or dispose of additional properties in the future, these amounts will change accordingly.

During the year ended December 31, 2016, we recorded a provision for loan loss related to our critical accounting estimate for the allowance for loan losses discussed in “Critical Accounting Policies” below and Note 6 to our consolidated financial statements. 

Changes in gains/losses on sales of properties are related to volume of property sales and the sales pricesDuring 2016 and 2017, we recognized impairment charges related to certain held-for-sale properties as the carrying values exceeded the estimated fair values less costs to sell.

40


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

During the year ended December 31, 2017, we completed four outpatient medical construction projects representing $63,036,000 or $311 per square foot. The following is a summary of outpatient medical construction projects pending as of December 31, 2017 (dollars in thousands):

  

Location

 

Square Feet

 

 

Commitment

 

 

Balance

 

Est. Completion

Palmer, AK

 

38,376

 

$

12,345

 

$

2,329

 

3Q18

Brooklyn, NY

 

140,955

 

 

105,177

 

 

49,901

 

3Q19

Total

 

179,331

 

$

117,522

 

$

52,230

 

 

 

     Total interest expense represents secured debt interest expense. The change in secured debt interest expense is primarily due to the net effect and timing of assumptions, extinguishments and principal amortizations. The fluctuations in loss (gain) on extinguishment of debt is primarily attributable the volume of extinguishments and terms of the related secured debt.  The following is a summary of our outpatient medical secured debt principal activity for the periods presented (dollars in thousands):

 

 

Year Ended

 

Year Ended

 

Year Ended

 

 

December 31, 2015

 

December 31, 2016

 

December 31, 2017

 

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

Beginning balance

 

$

609,268

 

5.838%

 

$

627,689

 

5.177%

 

$

404,079

 

4.846%

Debt assumed

 

 

120,959

 

2.113%

 

 

-

 

0.000%

 

 

23,094

 

6.670%

Debt extinguished

 

  

(88,182)

 

5.257%

 

  

(210,115)

 

5.970%

 

  

(137,416)

 

5.990%

Principal payments

 

  

(14,356)

 

5.975%

 

  

(13,495)

 

6.552%

 

  

(9,806)

 

6.850%

Ending balance

 

$

627,689

 

5.177%

 

$

404,079

 

4.846%

 

$

279,951

 

4.720%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Monthly averages

 

$

613,155

 

5.434%

 

$

536,774

 

5.106%

 

$

294,694

 

4.624%

 

     A portion of our outpatient medical properties were formed through partnerships.  Income or loss from unconsolidated entities represents our share of net income or losses from partnerships where we are the noncontrolling partner.  Net income attributable to noncontrolling interests represents our partners’ share of net income or loss relating to those partnerships where we are the controlling partner.

 

 Non-Segment/Corporate

     The following is a summary of our results of operations for the non-segment/corporate activities (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income

 

$

1,091

 

$

939

 

$

(152)

 

-14%

 

$

1,538

 

$

599

 

64%

 

$

447

 

41%

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

365,855

 

 

399,035

 

 

33,180

 

9%

 

 

396,148

 

 

(2,887)

 

-1%

 

 

30,293

 

8%

 

Loss (gain) on derivatives, net

 

 

-

 

 

(2,516)

 

 

(2,516)

 

n/a

 

 

-

 

 

2,516

 

-100%

 

 

-

 

n/a

 

General and administrative

 

 

147,416

 

 

155,241

 

 

7,825

 

5%

 

 

122,008

 

 

(33,233)

 

-21%

 

 

(25,408)

 

-17%

 

Loss (gain) on extinguishments of debt, net

 

 

24,777

 

 

16,439

 

 

(8,338)

 

-34%

 

 

-

 

 

(16,439)

 

-100%

 

 

(24,777)

 

-100%

 

Other expenses

 

 

10,583

 

 

11,998

 

 

1,415

 

13%

 

 

50,829

 

 

38,831

 

324%

 

 

40,246

 

380%

 

 

 

 

548,631

 

 

580,197

 

 

31,566

 

6%

 

 

568,985

 

 

(11,212)

 

-2%

 

 

20,354

 

4%

Loss from continuing operations before income taxes

 

 

(547,540)

 

 

(579,258)

 

 

(31,718)

 

6%

 

 

(567,447)

 

 

11,811

 

-2%

 

 

(19,907)

 

4%

Income tax benefit (expense)

 

 

(3,438)

 

 

24,488

 

 

27,926

 

n/a

 

 

2,070

 

 

(22,418)

 

-92%

 

 

5,508

 

n/a

Net loss

 

 

(550,978)

 

 

(554,770)

 

 

(3,792)

 

1%

 

 

(565,377)

 

 

(10,607)

 

2%

 

 

(14,399)

 

3%

Preferred stock dividends

 

 

65,406

 

 

65,406

 

 

-

 

0%

 

 

49,410

 

 

(15,996)

 

-24%

 

 

(15,996)

 

-24%

Preferred stock redemption charge

 

 

-

 

 

-

 

 

-

 

n/a

 

 

9,769

 

 

9,769

 

n/a

 

 

9,769

 

n/a

Net loss attributable to common stockholders

 

$

(616,384)

 

$

(620,176)

 

$

(3,792)

 

1%

 

$

(624,556)

 

$

(4,380)

 

1%

 

$

(8,172)

 

1%

 

     The following is a summary of our non-segment/corporate interest expense for the periods presented (dollars in thousands):

  

41


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

 

Year Ended

 

One Year Change

 

Year Ended

 

One Year Change

 

Two Year Change

 

 

December 31,

 

December 31,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2016

 

$

 

%

 

2017

 

$

 

%

 

$

 

%

Senior unsecured notes

 

$

341,265

 

$

368,775

 

$

27,510

 

8%

 

$

364,773

 

$

(4,002)

 

-1%

 

$

23,508

 

7%

Secured debt

 

  

357

 

  

310

 

  

(47)

 

-13%

 

  

127

 

  

(183)

 

-59%

 

  

(230)

 

-65%

Primary unsecured credit facility

 

  

10,812

 

  

16,811

 

  

5,999

 

55%

 

  

17,863

 

  

1,052

 

6%

 

  

7,051

 

65%

Loan expense

 

  

13,421

 

  

13,139

 

  

(282)

 

-2%

 

  

13,385

 

  

246

 

2%

 

  

(36)

 

0%

Totals

 

$

365,855

 

$

399,035

 

$

33,180

 

9%

 

$

396,148

 

$

(2,887)

 

-1%

 

$

30,293

 

8%

 

The change in interest expense on senior unsecured notes is due to the net effect of issuances and extinguishments, primarily the $450,000,000 of 4.70% senior unsecured notes extinguished in December 2016.  Please refer to Note 10 to consolidated financial statements for additional information.  The loss on extinguishment of debt in 2015 is primarily due to the early extinguishment of the 2016 senior unsecured notes. The loss on extinguishment of debt in 2016 is due to the early extinguishment of the 2017 senior unsecured notes. The change in interest expense on our primary unsecured credit facility is due primarily to the net effect and timing of draws, paydowns and variable interest rate changes.  Please refer to Note 9 of our consolidated financial statements for additional information regarding our primary unsecured credit facility.

     General and administrative expenses as a percentage of consolidated revenues for the years ended December 31, 2017, 2016 and 2015 were 2.83%, 3.63% and 3.82%, respectively.  The 2017 decrease in general and administrative expenses is primarily related to a reduction in professional service fees for tax and legal consulting and compensation costs as a result of execution of our strategic initiatives.  

     Other expenses for 2017 primarily represents $40,730,000 of costs related to finalization of an agreement with the University of Toledo Foundation to transfer our corporate headquarters as a donation. Other expenses for all years also includes severance-related costs associated with the departure of certain executive officers and key employees.  During 2017, we incurred expenses totaling approximately $3,811,000 in connection with the litigation captioned Welltower v. Brinker, Case No. G-4801-CI-0201702692-000 (Ct. Common Pleas, Toledo, Ohio).  These expenses were offset by:  1) $4,000,000 we received pursuant to the terms of the settlement of the litigation; and 2) approximately $2,848,000 that Mr. Brinker was owed under his Separation Agreement with us, which was forgiven pursuant to the terms of the settlement of the litigation. Other expenses in 2015 also included costs associated with the termination of our investment in a strategic outpatient medical partnership.

     The fluctuations in income taxes are primarily due to benefits recognized in the year ended December 31, 2016 related to the release of a valuation allowance reserve on a taxable subsidiary and the restructuring of an unconsolidated investment. The decrease in preferred dividends and the preferred stock redemption charge are due to the redemption of our 6.5% Series J preferred stock during the three months ended March 31, 2017.


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

Other

 

Non-GAAP Financial Measures

          We believe that net income and net income attributable to common stockholders (“NICS”), as defined by U.S. GAAP, are the most appropriate earnings measurements. However, we consider FFO, NOI, SSNOI, EBITDA and Adjusted EBITDA (“AEBITDA”) to be useful supplemental measures of our operating performance. Historical cost accounting for real estate assets in accordance with U.S. GAAP implicitly assumes that the value of real estate assets diminishes predictably over time as evidenced by the provision for depreciation. However, since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient. In response, the National Association of Real Estate Investment Trusts (“NAREIT”) created funds from operations attributable to common stockholders (“FFO”) as a supplemental measure of operating performance for REITs that excludes historical cost depreciation from net income. FFO, as defined by NAREIT, means NICS, computed in accordance with U.S. GAAP, excluding gains (or losses) from sales of real estate and impairment of depreciable assets, plus depreciation and amortization, and after adjustments for unconsolidated entities and noncontrolling interests.

     Consolidated net operating income (“NOI”) is used to evaluate the operating performance of our properties. We define NOI as total revenues, including tenant reimbursements, less property operating expenses. Property operating expenses represent costs associated with managing, maintaining and servicing tenants for our seniors housing operating and outpatient medical facility properties.  These expenses include, but are not limited to, property-related payroll and benefits, property management fees paid to operators, marketing, housekeeping, food service, maintenance, utilities, property taxes and insurance.  General and administrative expenses (excluded from NOI) represent costs unrelated to property operations.  These expenses include, but are not limited to, payroll and benefits, professional services, office expenses, and depreciation of corporate fixed assets.  Same store NOI (“SSNOI”) is used to evaluate the operating performance of our properties under a consistent population which eliminates changes in the composition of our portfolio.  As used herein, same store is generally defined as those revenue-generating properties in the portfolio for the reporting period subsequent to January 1, 2015.  Land parcels, loans, sub-leases and major capital restructurings as well as any properties acquired, developed/redeveloped, transitioned, sold or classified as held for sale during that period are excluded from the same store amounts.  We believe NOI and SSNOI provide investors relevant and useful information because they measure the operating performance of our properties at the property level on an unleveraged basis. We use NOI and SSNOI to make decisions about resource allocations and to assess the property level performance of our properties.

     EBITDA stands for earnings (net income) before interest, taxes, depreciation and amortization. We believe that EBITDA, along with net income and cash flow provided from operating activities, is an important supplemental measure because it provides additional information to assess and evaluate the performance of our operations. We primarily utilize EBITDA to measure our interest coverage ratio, which represents EBITDA divided by total interest, and our fixed charge coverage ratio, which represents EBITDA divided by fixed charges. Fixed charges include total interest, secured debt principal amortization, and preferred dividends. Covenants in our senior unsecured notes contain financial ratios based on a definition of EBITDA that is specific to those agreements. Failure to satisfy these covenants could result in an event of default that could have a material adverse impact on our cost and availability of capital, which could in turn have a material adverse impact on our consolidated results of operations, liquidity and/or financial condition. Due to the materiality of these debt agreements and the financial covenants, we have disclosed AEBITDA, which represents EBITDA as defined above excluding unconsolidated entities and adjusted for items per our covenant. We use AEBITDA to measure our adjusted fixed charge coverage ratio, which represents AEBITDA divided by fixed charges on a trailing twelve months basis. Fixed charges include total interest (excluding capitalized interest and non-cash interest expenses), secured debt principal amortization and preferred dividends. Our covenant requires an adjusted fixed charge coverage ratio of at least 1.50 times.

     Our supplemental reporting measures and similarly entitled financial measures are widely used by investors, equity and debt analysts and rating agencies in the valuation, comparison, rating and investment recommendations of companies. Management uses these financial measures to facilitate internal and external comparisons to our historical operating results and in making operating decisions. Additionally, these measures are utilized by the Board of Directors to evaluate management. None of our supplemental measures represent net income or cash flow provided from operating activities as determined in accordance with U.S. GAAP and should not be considered as alternative measures of profitability or liquidity. Finally, the supplemental measures, as defined by us, may not be comparable to similarly entitled items reported by other REITs or other companies.

43


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

     The table below reflects the reconciliation of FFO to NICS, the most directly comparable U.S. GAAP measure, for the periods presented. Noncontrolling interest and unconsolidated entity amounts represent adjustments to reflect our share of depreciation and amortization, gains/loss on real estate dispositions and impairments of assets.  Amounts are in thousands except for per share data.

 

 

 

 

Year Ended December 31,

FFO Reconciliation:

  

2015

 

2016

 

2017

Net income attributable to common stockholders

  

$

818,344

 

$

1,012,397

 

$

463,595

Depreciation and amortization

  

 

826,240

 

 

901,242

 

 

921,720

Impairment of assets

 

 

2,220

 

 

37,207

 

 

124,483

Loss (gain) on real estate dispositions, net

  

 

(280,387)

 

 

(364,046)

 

 

(344,250)

Noncontrolling interests

 

 

(39,271)

 

 

(71,527)

 

 

(60,018)

Unconsolidated entities

  

 

82,494

 

 

67,667

 

 

60,046

Funds from operations attributable to common stockholders

  

$

1,409,640

 

$

1,582,940

 

$

1,165,576

 

 

  

 

 

 

 

 

 

 

 

Average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

Basic

  

 

348,240

 

 

358,275

 

 

367,237

 

Diluted

  

 

349,424

 

 

360,227

 

 

369,001

 

 

  

 

 

 

 

 

 

 

 

Per share data:

  

 

 

 

 

 

 

 

 

Net income attributable to common stockholders

  

 

 

 

 

 

 

 

 

 

Basic

  

$

2.35

 

$

2.83

 

$

1.26

 

Diluted

  

 

2.34

 

 

2.81

 

 

1.26

 

 

  

 

 

 

 

 

 

 

 

Funds from operations attributable to common stockholders

  

 

 

 

 

 

 

 

 

 

Basic

  

$

4.05

 

$

4.42

 

$

3.17

 

Diluted

  

 

4.03

 

 

4.39

 

 

3.16

44


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

     The table below reflects the reconciliation of AEBITDA to net income, the most directly comparable U.S. GAAP measure, for the periods presented.  Dollars are in thousands.

 

 

 

Year Ended December 31,

AEBITDA Reconciliation:

 

2015

 

2016

 

2017

Net income

 

$

888,549

 

$

1,082,070

 

$

540,613

Interest expense

 

  

492,169

 

 

521,345

 

 

484,622

Income tax expense (benefit)

 

  

6,451

 

 

(19,128)

 

 

20,128

Depreciation and amortization

 

  

826,240

 

 

901,242

 

 

921,720

 

EBITDA

 

 

2,213,409

 

 

2,485,529

 

 

1,967,083

Stock-based compensation expense

 

  

30,844

 

 

28,869

 

 

19,102

Transaction costs

 

 

110,926

 

 

42,910

 

 

-

Provision for loan losses

 

  

-

 

 

10,215

 

 

62,966

Loss (gain) on extinguishment of debt, net

 

  

34,677

 

 

17,214

 

 

37,241

Impairment of assets

 

 

2,220

 

 

37,207

 

 

124,483

Loss (gain) on real estate dispositions, net

 

 

(280,387)

 

 

(364,046)

 

 

(344,250)

Loss (gain) on derivatives, net

 

 

(58,427)

 

 

(2,448)

 

 

2,284

Other expenses

 

 

40,636

 

 

7,721

 

 

176,395

Loss (income) from unconsolidated entities

 

 

21,504

 

 

10,357

 

 

83,125

Additional other income

 

 

(2,144)

 

 

(16,664)

 

 

-

AEBITDA

 

$

2,113,258

 

$

2,256,864

 

$

2,128,429

 

 

 

  

 

 

  

 

 

  

 

Adjusted Interest Coverage Ratio:

 

 

 

 

 

 

 

 

 

Interest expense

 

$

492,169

 

$

521,345

 

$

484,622

Capitalized interest

 

  

8,670

 

  

16,943

 

  

13,489

Non-cash interest expense

 

  

(2,586)

 

  

(1,681)

 

  

(10,359)

 

Total interest

 

  

498,253

 

  

536,607

 

  

487,752

AEBITDA

 

$

2,113,258

 

$

2,256,864

 

$

2,128,429

 

Adjusted interest coverage ratio

 

  

4.24x

 

 

4.21x

 

 

4.36x

 

 

 

  

 

 

  

 

 

  

 

Adjusted Fixed Charge Coverage Ratio:

 

 

 

 

 

 

 

 

 

Total interest

 

$

498,253

 

$

536,607

 

$

487,752

Secured debt principal payments

 

  

67,064

 

  

74,466

 

  

64,078

Preferred dividends

 

  

65,406

 

  

65,406

 

  

49,410

 

Total fixed charges

 

  

630,723

 

  

676,479

 

  

601,240

AEBITDA

 

$

2,113,258

 

$

2,256,864

 

$

2,128,429

 

Adjusted fixed charge coverage ratio

 

  

3.35x

 

 

3.34x

 

 

3.54x

 

     Our leverage ratios include book capitalization, undepreciated book capitalization, and market capitalization. Book capitalization represents the sum of net debt (defined as total long-term debt less cash and cash equivalents and any IRC section 1031 deposits), total equity and redeemable noncontrolling interests. Undepreciated book capitalization represents book capitalization adjusted for accumulated depreciation and amortization. Market capitalization represents book capitalization adjusted for the fair market value of our common stock. Our leverage ratios are defined as the proportion of net debt to total capitalization. The table below reflects the reconciliation of our leverage ratios to our balance sheets for the periods presented. Amounts are in thousands, except share price.

 

45


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

 

2015

 

 

2016

 

 

2017

Book capitalization:

 

 

 

 

 

 

 

 

 

Borrowings under primary unsecured credit facility

 

$

835,000

 

$

645,000

 

$

719,000

Long-term debt obligations(1)

 

 

12,132,686

 

 

11,713,245

 

 

11,012,936

Cash & cash equivalents(2)

 

 

(484,754)

 

 

(557,659)

 

 

(249,620)

Total net debt

 

 

12,482,932

 

 

11,800,586

 

 

11,482,316

Total equity

 

 

15,175,885

 

 

15,281,472

 

 

14,925,452

Redeemable noncontrolling interest

 

 

183,083

 

 

398,433

 

 

375,194

Book capitalization

 

$

27,841,900

 

$

27,480,491

 

$

26,782,962

 

Net debt to book capitalization ratio

 

 

44.8%

 

 

42.9%

 

 

42.9%

 

 

 

 

 

 

 

 

 

 

 

 

Undepreciated book capitalization:

 

 

 

 

 

 

 

 

 

Total net debt

 

$

12,482,932

 

$

11,800,586

 

$

11,482,316

Accumulated depreciation and amortization

 

 

3,796,297

 

 

4,093,494

 

 

4,838,370

Total equity

 

 

15,175,885

 

 

15,281,472

 

 

14,925,452

Redeemable noncontrolling interest

 

 

183,083

 

 

398,433

 

 

375,194

Undepreciated book capitalization

 

$

31,638,197

 

$

31,573,985

 

$

31,621,332

 

Net debt to undepreciated book capitalization ratio

 

 

39.5%

 

 

37.4%

 

 

36.3%

 

 

 

 

 

 

 

 

 

 

 

 

Market capitalization:

 

 

 

 

 

 

 

 

 

Common shares outstanding

 

 

354,778

 

 

362,602

 

 

371,732

Period end share price

 

$

68.03

 

$

66.93

 

$

63.77

Common equity market capitalization

 

$

24,135,547

 

$

24,268,952

 

$

23,705,350

Total net debt

 

 

12,482,932

 

 

11,800,586

 

 

11,482,316

Noncontrolling interests(3)

 

 

768,408

 

 

873,512

 

 

877,499

Preferred stock

 

 

1,006,250

 

 

1,006,250

 

 

718,503

Market capitalization:

 

$

38,393,137

 

$

37,949,300

 

$

36,783,668

 

Net debt to market capitalization ratio

 

 

32.5%

 

 

31.1%

 

 

31.2%

 

 

 

 

 

 

 

 

 

 

 

 

(1) Amounts include senior unsecured notes, secured debt and capital lease obligations as reflected on our consolidated balance sheet.

(2) Inclusive of IRC section 1031 deposits, if any.

(3) Includes all noncontrolling interests (redeemable and permanent) as reflected on our consolidated balance sheet.

 

     The following tables reflect the reconciliation of NOI and SSNOI to net income, the most directly comparable U.S. GAAP measure, for the years presented.  Dollar amounts are in thousands.

 

 

 

 

 

Year Ended December 31,

NOI Reconciliation:

 

2015

 

2016

 

2017

Net income

 

$

888,549

 

$

1,082,070

 

$

540,613

Loss (gain) on real estate dispositions, net

 

 

(280,387)

 

 

(364,046)

 

 

(344,250)

Loss (income) from unconsolidated entities

 

 

21,504

 

 

10,357

 

 

83,125

Income tax expense (benefit)

 

 

6,451

 

 

(19,128)

 

 

20,128

Other expenses

 

 

46,231

 

 

11,998

 

 

177,776

Impairment of assets

 

 

2,220

 

 

37,207

 

 

124,483

Provision for loan losses

 

 

-

 

 

10,215

 

 

62,966

Loss (gain) on extinguishment of debt, net

 

 

34,677

 

 

17,214

 

 

37,241

Loss (gain) on derivatives, net

 

 

(58,427)

 

 

(2,448)

 

 

2,284

Transaction costs

 

 

110,926

 

 

42,910

 

 

-

General and administrative expenses

 

 

147,416

 

 

155,241

 

 

122,008

Depreciation and amortization

 

 

826,240

 

 

901,242

 

 

921,720

Interest expense

 

 

492,169

 

 

521,345

 

 

484,622

Consolidated net operating income (NOI)

 

$

2,237,569

 

$

2,404,177

 

$

2,232,716

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI by segment:

 

 

 

 

 

 

 

 

 

 

Triple-net

 

$

1,175,806

 

$

1,208,860

 

$

967,084

 

Seniors housing operating

 

 

701,262

 

 

814,114

 

 

880,026

 

Outpatient medical

 

 

359,410

 

 

380,264

 

 

384,068

 

Non-segment/corporate

 

 

1,091

 

 

939

 

 

1,538

 

 

Total NOI

 

$

2,237,569

 

$

2,404,177

 

$

2,232,716

 

46


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

SSNOI Reconciliation:

 

2015

 

2016

 

2017

NOI:

 

 

 

 

 

 

 

 

 

 

Triple-net

 

$

1,175,806

 

$

1,208,860

 

$

967,084

 

Seniors housing operating

 

 

701,262

 

 

814,114

 

 

880,026

 

Outpatient medical

 

 

359,410

 

 

380,264

 

 

384,068

 

 

 

Total

 

 

2,236,478

 

 

2,403,238

 

 

2,231,178

Adjustments:

 

 

 

 

 

 

 

 

 

 

Triple-net:

 

 

 

 

 

 

 

 

 

 

 

Non-cash NOI on same store properties

 

 

(48,890)

 

 

(38,899)

 

 

(28,602)

 

 

NOI attributable to non same store properties

 

 

(498,131)

 

 

(574,049)

 

 

(333,279)

 

 

 

Subtotal

 

 

(547,021)

 

 

(612,948)

 

 

(361,881)

 

Seniors housing operating:

 

 

 

 

 

 

 

 

 

 

 

Non-cash NOI on same store properties

 

 

1,003

 

 

1,990

 

 

1,242

 

 

NOI attributable to non same store properties

 

 

(83,880)

 

 

(190,459)

 

 

(246,731)

 

 

 

Subtotal

 

 

(82,877)

 

 

(188,469)

 

 

(245,489)

 

Outpatient medical:

 

 

 

 

 

 

 

 

 

 

 

Non-cash NOI on same store properties

 

 

(6,095)

 

 

(3,073)

 

 

(1,764)

 

 

NOI attributable to non same store properties

 

 

(76,819)

 

 

(99,237)

 

 

(102,851)

 

 

 

Subtotal

 

 

(82,914)

 

 

(102,310)

 

 

(104,615)

 

 

 

Total

 

 

(712,812)

 

 

(903,727)

 

 

(711,985)

SSNOI by segment:

 

 

 

 

 

 

 

 

 

 

Triple-net

 

 

628,785

 

 

595,912

 

 

605,203

 

Seniors housing operating

 

 

618,385

 

 

625,645

 

 

634,537

 

Outpatient medical

 

 

276,496

 

 

277,954

 

 

279,453

 

 

 

Total

 

$

1,523,666

 

$

1,499,511

 

$

1,519,193

 

 

 

 

 

 

 

 

 

 

 

 

 

SSNOI Property Reconciliation:

 

 

 

 

 

 

 

 

 

 

Total properties

 

 

1,286

 

 

 

 

 

 

 

Acquisitions

 

 

(231)

 

 

 

 

 

 

 

Developments

 

 

(33)

 

 

 

 

 

 

 

Disposals/Held-for-sale

 

 

(71)

 

 

 

 

 

 

 

Segment transitions

 

 

(28)

 

 

 

 

 

 

 

Other(1)

 

 

(9)

 

 

 

 

 

 

 

 

Same store properties

 

 

914

 

 

 

 

 

 

(1) Includes eight land parcels and one loan.

47


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

Critical Accounting Policies

Our consolidated financial statements are prepared in accordance with U.S. GAAP, which requires us to make estimates and assumptions.  Management considers accounting estimates or assumptions critical if:

·         the nature of the estimates or assumptions is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change; and

·         the impact of the estimates and assumptions on financial condition or operating performance is material.

Management has discussed the development and selection of its critical accounting policies with the Audit Committee of the Board of Directors and the Audit Committee has reviewed the disclosure presented below relating to them.  Management believes the current assumptions and other considerations used to estimate amounts reflected in our consolidated financial statements are appropriate and are not reasonably likely to change in the future.  However, since these estimates require assumptions to be made that were uncertain at the time the estimate was made, they bear the risk of change.  If actual experience differs from the assumptions and other considerations used in estimating amounts reflected in our consolidated financial statements, the resulting changes could have a material adverse effect on our consolidated results of operations, liquidity and/or financial condition.  Please refer to Note 2 to our consolidated financial statements for further information on significant accounting policies that impact us and for the impact of new accounting standards, including accounting pronouncements that were issued but not yet adopted by us.

The following table presents information about our critical accounting policies, as well as the material assumptions used to develop each estimate:

 

Nature of Critical

Accounting Estimate

Assumptions/Approach

Used

Principles of Consolidation

The consolidated financial statements include our accounts, the accounts of our wholly-owned subsidiaries, and the accounts of joint venture entities in which we own a majority voting interest with the ability to control operations and where no substantive participating rights or substantive kick out rights have been granted to the noncontrolling interests.  In addition, we consolidate those entities deemed to be variable interest entities (“VIEs”) in which we are determined to be the primary beneficiary. All material intercompany transactions and balances have been eliminated in consolidation.

 

We make judgments about which entities are VIEs based on an assessment of whether (i) the equity investors as a group, if any, do not have a controlling financial interest, or (ii) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support. We make judgments with respect to our level of influence or control of an entity and whether we are (or are not) the primary beneficiary of a VIE. Consideration of various factors includes, but is not limited to, our ability to direct the activities that most significantly impact the entity's economic performance, our form of ownership interest, our representation on the entity's governing body, the size and seniority of our investment, our ability and the rights of other investors to participate in policy making decisions, replace the manager and/or liquidate the entity, if applicable. Our ability to correctly assess our influence or control over an entity at inception of our involvement or on a continuous basis when determining the primary beneficiary of a VIE affects the presentation of these entities in our consolidated financial statements. If we perform a primary beneficiary analysis at a date other than at inception of the VIE, our assumptions may be different and may result in the identification of a different primary beneficiary.

     

 

48


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

Nature of Critical

Accounting Estimate

Assumptions/Approach

Used

 

Real Estate Acquisitions

On January 1, 2017, we adopted Accounting Standards Update 2017-01, Clarifying the Definition of a Business (“ASU 2017-01”) which narrows the Financial Accounting Standards Board’s (“FASB”) definition of a business and provides a framework that gives entities a basis for making reasonable judgments about whether a transaction involves an asset or a business. ASU 2017-01 states that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the acquired asset is not a business. If this initial test is not met, an acquired asset cannot be considered a business unless it includes an input and a substantive process that together significantly contribute to the ability to create output. The primary differences between business combinations and asset acquisitions include recording the asset acquisition at relative fair value, capitalizing transaction costs, and the elimination of the measurement period in which to record adjustments to the transaction. We believe that substantially all our real estate acquisitions are considered asset acquisitions. We are applying ASU 2017-01 prospectively for acquisitions after January 1, 2017. Regardless of whether an acquisition is considered an asset acquisition or a business combination, the cost of real property acquired is allocated to net tangible and identifiable intangible assets based on their respective fair values. Tangible assets primarily consist of land, buildings, and improvements. The remaining purchase price is allocated among identifiable intangible assets primarily consisting of the above or below market component of in-place leases and the value of in-place leases. The total amount of other intangible assets acquired is further allocated to in-place lease values and customer relationship values based on management’s evaluation of the specific characteristics of each tenant’s lease and our overall relationship with that respective tenant. Real property developed by us is recorded at cost, including the capitalization of construction period interest.

 

We make estimates as part of our allocation of the purchase price of acquisitions to the various components of the acquisition based upon the relative fair value of each component. The most significant components of our allocations are typically the allocation of fair value to the buildings as-if-vacant, land, and in-place leases. In the case of the fair value of buildings and the allocation of value to land and other intangibles, our estimates of the values of these components will affect the amount of depreciation and amortization we record over the estimated useful life of the property acquired or the remaining lease term. In the case of the value of in-place leases, we make our best estimates based on our evaluation of the specific characteristics of each tenant's lease. Factors considered include estimates of carrying costs during hypothetical expected lease-up periods, market conditions, and costs to execute similar leases. Our assumptions affect the amount of future revenue that we will recognize over the remaining lease term for the acquired in-place leases.

We compute depreciation and amortization on our properties using the straight-line method based on their estimated useful lives which range from 15 to 40 years for buildings and five to 15 years for improvements. Amortization periods for intangibles are based on the remaining life of the lease or lease-up period.

 

Allowance for Loan Losses

We maintain an allowance for loan losses in accordance with U.S. GAAP.  The allowance for loan losses is maintained at a level believed adequate to absorb potential losses in our loans receivable.  The determination of the allowance is based on a quarterly evaluation of all outstanding loans.  If this evaluation indicates that there is a greater risk of loan charge-offs, additional allowances or placement on non-accrual status may be required.  A loan is impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due as scheduled according to the contractual terms of the original loan agreement or if it has been modified in a troubled debt restructuring.  Consistent with this definition, all loans on non-accrual are deemed impaired.  To the extent circumstances improve and the risk of collectability is diminished, we will return these loans to income accrual status.

 

The determination of the allowance is based on a quarterly evaluation of all outstanding loans, including general economic conditions and estimated collectability of loan payments. We evaluate the collectability of our loans receivable based on a combination of factors, including, but not limited to, delinquency status, historical loan charge-offs, financial strength of the borrower and guarantors, and value of the underlying collateral. Any loans with collectability concerns are subjected to a projected payoff valuation.  The valuation is based on the expected future cash flows and/or the estimated fair value of the underlying collateral. The valuation is compared to the outstanding balance to determine the reserve needed for each loan.  We may base our valuation on a loan’s observable market price, if any, or the fair value of collateral, net of sales costs, if the repayment of the loan is expected to be provided solely by the collateral.

       

 

49


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

Nature of Critical

Accounting Estimate

Assumptions/Approach

Used

Revenue Recognition

Revenue is recorded in accordance with U.S. GAAP, which requires that revenue be recognized after four basic criteria are met. These four criteria include persuasive evidence of an arrangement, the rendering of service, fixed and determinable income and reasonably assured collectability. If the collectability of revenue is determined incorrectly, the amount and timing of our reported revenue could be significantly affected. Interest income on loans is recognized as earned based upon the principal amount outstanding subject to an evaluation of collectability risk. Substantially all of our operating leases contain fixed and/or contingent escalating rent structures. Leases with fixed annual rental escalators are generally recognized on a straight-line basis over the initial lease period, subject to a collectability assessment. Rental income related to leases with contingent rental escalators is generally recorded based on the contractual cash rental payments due for the period.  We recognize resident fees and services, other than move-in fees, monthly as services are provided.  Lease agreements with residents generally have a term of one year and are cancelable by the resident with 30 days’ notice.

 

 

We evaluate the collectability of our revenues and related receivables on an on-going basis. We evaluate collectability based on assumptions and other considerations including, but not limited to, the certainty of payment, payment history, the financial strength of the investment’s underlying operations as measured by cash flows and payment coverages, the value of the underlying collateral and guaranties, and current economic conditions.

If our evaluation indicates that collectability is not reasonably assured, we may place an investment on non-accrual or reserve against all or a portion of current income as an offset to revenue.

 

 

Impairment of Long-Lived Assets

We review our long-lived assets for potential impairment in accordance with U.S. GAAP. An impairment charge must be recognized when the carrying value of a long-lived asset is not recoverable.  The carrying value is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset.  If it is determined that a permanent impairment of a long-lived asset has occurred, the carrying value of the asset is reduced to its fair value and an impairment charge is recognized for the difference between the carrying value and the fair value.

 

 

The net book value of long-lived assets is reviewed quarterly on a property by property basis to determine if there are indicators of impairment.  These indicators may include anticipated operating losses at the property level, the tenant’s inability to make rent payments, a decision to dispose of an asset before the end of its estimated useful life, and changes in the market that may permanently reduce the value of the property.  If indicators of impairment exist, then the undiscounted future cash flows from the most likely uses of the property are compared to the current net book value.  This analysis requires us to determine if indicators of impairment exist and to estimate the most likely stream of cash flows to be generated from the property during the period the property is expected to be held.  Properties that meet the held-for-sale criteria are recorded at the lesser of fair value less costs to sell or carrying value.

 

50


Item 7A. Quantitative and Qualitative Disclosures About Market Risk

     We are exposed to various market risks, including the potential loss arising from adverse changes in interest rates and foreign currency exchange rates. We seek to mitigate the underlying foreign currency exposures with gains and losses on derivative contracts hedging these exposures.  We seek to mitigate the effects of fluctuations in interest rates by matching the terms of new investments with new long-term fixed rate borrowings to the extent possible. We may or may not elect to use financial derivative instruments to hedge interest rate exposure. These decisions are principally based on our policy to match our variable rate investments with comparable borrowings, but are also based on the general trend in interest rates at the applicable dates and our perception of the future volatility of interest rates. This section is a discussion of the risks associated with potential fluctuations in interest rates and foreign currency exchange rates. For more information, see Notes 11 and 16 to our consolidated financial statements.

     We historically borrow on our primary unsecured credit facility to acquire, construct or make loans relating to health care and seniors housing properties. Then, as market conditions dictate, we will issue equity or long-term fixed rate debt to repay the borrowings under our primary unsecured credit facility.  We are subject to risks associated with debt financing, including the risk that existing indebtedness may not be refinanced or that the terms of refinancing may not be as favorable as the terms of current indebtedness. The majority of our borrowings were completed under indentures or contractual agreements that limit the amount of indebtedness we may incur. Accordingly, in the event that we are unable to raise additional equity or borrow money because of these limitations, our ability to acquire additional properties may be limited.

     A change in interest rates will not affect the interest expense associated with our fixed rate debt. Interest rate changes, however, will affect the fair value of our fixed rate debt. Changes in the interest rate environment upon maturity of this fixed rate debt could have an effect on our future cash flows and earnings, depending on whether the debt is replaced with other fixed rate debt, variable rate debt or equity, or repaid by the sale of assets. To illustrate the impact of changes in the interest rate markets, we performed a sensitivity analysis on our fixed rate debt instruments whereby we modeled the change in net present values arising from a hypothetical 1% increase in interest rates to determine the instruments’ change in fair value. The following table summarizes the analysis performed as of the dates indicated (in thousands):

  

 

 

December 31, 2017

 

December 31, 2016

 

 

Principal balance

 

Fair value change

 

Principal balance

 

Fair value change

Senior unsecured notes

 

$

7,710,219

 

$

(500,951)

 

$

7,568,832

 

$

(521,203)

Secured debt

 

 

1,749,958

 

 

(63,492)

 

 

2,489,276

 

 

(73,944)

Totals

 

$

9,460,177

 

$

(564,443)

 

$

10,058,108

 

$

(595,147)

 

     Our variable rate debt, including our primary unsecured credit facility, is reflected at fair value. At December 31, 2017, we had $2,294,678,000 outstanding related to our variable rate debt. Assuming no changes in outstanding balances, a 1% increase in interest rates would result in increased annual interest expense of $22,947,000. At December 31, 2016, we had $2,311,996,000 outstanding under our variable rate debt. Assuming no changes in outstanding balances, a 1% increase in interest rates would have resulted in increased annual interest expense of $23,120,000.

     We are subject to currency fluctuations that may, from time to time, affect our financial condition and results of operations. Increases or decreases in the value of the Canadian Dollar or British Pounds Sterling relative to the U.S. Dollar impact the amount of net income we earn from our investments in Canada and the United Kingdom. Based solely on our results for the year ended December 31, 2017, including the impact of existing hedging arrangements, if these exchange rates were to increase or decrease by 10%, our net income from these investments would increase or decrease, as applicable, by less than $12,000,000.  We will continue to mitigate these underlying foreign currency exposures with non-U.S. denominated borrowings and gains and losses on derivative contracts.  If we increase our international presence through investments in, or acquisitions or development of, seniors housing and health care properties outside the U.S., we may also decide to transact additional business or borrow funds in currencies other than U.S. Dollars, Canadian Dollars or British Pounds Sterling. To illustrate the impact of changes in foreign currency markets, we performed a sensitivity analysis on our derivative portfolio whereby we modeled the change in net present values arising from a hypothetical 1% increase in foreign currency exchange rates to determine the instruments’ change in fair value.  The following table summarizes the results of the analysis performed, excluding cross currency hedge activity (dollars in thousands):

 

 

December 31, 2017

 

December 31, 2016

 

 

Carrying value

 

Fair value change

 

Carrying value

 

Fair value change

Foreign currency exchange contracts

 

$

23,238

 

$

12,929

 

$

87,962

 

$

722

Debt designated as hedges

 

 

1,620,273

 

 

16,203

 

 

1,481,591

 

 

13,000

Totals

 

$

1,643,511

 

$

29,132

 

$

1,569,553

 

$

13,722

51


  

Item 8.  Financial Statements and Supplementary Data

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

The Board of Directors and Shareholders of Welltower Inc.

 

Opinion on the Financial Statements

 

     We have audited the accompanying consolidated balance sheets of Welltower Inc. and subsidiaries (the Company) as of December 31, 2017 and 2016, the related consolidated statements of comprehensive income, equity and cash flows for each of the three years in the period ended December 31, 2017, and the related notes and financial statement schedules listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2017 and 2016 and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2017, in conformity with U.S. generally accepted accounting principles.

 

     We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 28, 2018 expressed an unqualified opinion thereon.

 

Basis for Opinion

 

     These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

     We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

 

                                    /s/  Ernst & Young LLP

 

 

We have served as the Company’s auditor since 1970.

Toledo, Ohio

February 28, 2018

  

 

52


CONSOLIDATED BALANCE SHEETS

WELLTOWER INC. AND SUBSIDIARIES

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

  

2017

 

2016

Assets

  

 

Real estate investments:

 

 

 

 

 

 

 

Real property owned:

 

 

 

 

 

 

 

 

Land and land improvements

  

$

2,734,467

 

$

2,591,071

 

 

Buildings and improvements

 

 

25,373,117

 

 

24,496,153

 

 

Acquired lease intangibles

 

 

1,502,471

 

 

1,402,884

 

 

Real property held for sale, net of accumulated depreciation

 

 

734,147

 

 

1,044,859

 

 

Construction in progress

 

 

237,746

 

 

506,091

 

 

 

Gross real property owned

 

 

30,581,948

 

 

30,041,058

 

 

Less accumulated depreciation and amortization

 

 

(4,838,370)

 

 

(4,093,494)

 

 

 

Net real property owned

 

 

25,743,578

 

 

25,947,564

 

 

Real estate loans receivable

 

 

495,871

 

 

622,628

 

 

Less allowance for losses on loans receivable

 

 

(68,372)

 

 

(6,563)

 

 

 

Net real estate loans receivable

 

 

427,499

 

 

616,065

 

Net real estate investments

 

 

26,171,077

 

 

26,563,629

Other assets:

 

 

 

 

 

 

 

 

Investments in unconsolidated entities

 

 

445,585

 

 

457,138

 

 

Goodwill

 

 

68,321

 

 

68,321

 

 

Cash and cash equivalents

 

 

243,777

 

 

419,378

 

 

Restricted cash

 

 

65,526

 

 

187,842

 

 

Straight-line receivable

 

 

389,168

 

 

342,578

 

 

Receivables and other assets

 

 

560,991

 

 

826,298

 

 

 

Total other assets

 

 

1,773,368

 

 

2,301,555

Total assets

 

$

27,944,445

 

$

28,865,184

 

 

 

 

 

 

 

 

 

 

 

Liabilities and equity

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Borrowings under primary unsecured credit facility

 

$

719,000

 

$

645,000

 

 

Senior unsecured notes

 

 

8,331,722

 

 

8,161,619

 

 

Secured debt

 

 

2,608,976

 

 

3,477,699

 

 

Capital lease obligations

 

 

72,238

 

 

73,927

 

 

Accrued expenses and other liabilities

 

 

911,863

 

 

827,034

Total liabilities

 

 

12,643,799

 

 

13,185,279

 

 

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interests

 

 

375,194

 

 

398,433

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

Preferred stock

 

 

718,503

 

 

1,006,250

 

 

Common stock

 

 

372,449

 

 

363,071

 

 

Capital in excess of par value

 

 

17,662,681

 

 

16,999,691

 

 

Treasury stock

 

 

(64,559)

 

 

(54,741)

 

 

Cumulative net income

 

 

5,316,580

 

 

4,803,575

 

 

Cumulative dividends

 

 

(9,471,712)

 

 

(8,144,981)

 

 

Accumulated other comprehensive income (loss)

 

 

(111,465)

 

 

(169,531)

 

 

Other equity

 

 

670

 

 

3,059

 

 

 

Total Welltower Inc. stockholders’ equity

 

 

14,423,147

 

 

14,806,393

 

 

Noncontrolling interests

 

 

502,305

 

 

475,079

Total equity

 

 

14,925,452

 

 

15,281,472

Total liabilities and equity

 

$

27,944,445

 

$

28,865,184

 

See accompanying notes

 

53


CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

WELLTOWER INC. AND SUBSIDIARIES

(In thousands, except per share data)

 

 

 

 

Year Ended December 31,

 

 

 

 

2017

 

2016

 

2015

Revenues:

 

 

 

 

 

 

 

 

 

 

Rental income

  

$

1,445,871

 

$

1,648,815

 

$

1,598,948

 

Resident fees and services

 

 

2,779,423

 

 

2,504,731

 

 

2,158,031

 

Interest income

 

 

73,811

 

 

97,963

 

 

84,141

 

Other income

 

 

17,536

 

 

29,651

 

 

18,706

 

 

Total revenues

 

 

4,316,641

 

 

4,281,160

 

 

3,859,826

Expenses:

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

484,622

 

 

521,345

 

 

492,169

 

Property operating expenses

 

 

2,083,925

 

 

1,876,983

 

 

1,622,257

 

Depreciation and amortization

 

 

921,720

 

 

901,242

 

 

826,240

 

General and administrative

 

 

122,008

 

 

155,241

 

 

147,416

 

Transaction costs

 

 

-

 

 

42,910

 

 

110,926

 

Loss (gain) on derivatives, net

 

 

2,284

 

 

(2,448)

 

 

(58,427)

 

Loss (gain) on extinguishment of debt, net

 

 

37,241

 

 

17,214

 

 

34,677

 

Provision for loan losses

 

 

62,966

 

 

10,215

 

 

-

 

Impairment of assets

 

 

124,483

 

 

37,207

 

 

2,220

 

Other expenses

 

 

177,776

 

 

11,998

 

 

46,231

 

 

Total expenses

 

 

4,017,025

 

 

3,571,907

 

 

3,223,709

Income from continuing operations before income taxes

 

 

 

 

 

 

 

 

 

 

and income from unconsolidated entities

 

 

299,616

 

 

709,253

 

 

636,117

Income tax (expense) benefit

 

 

(20,128)

 

 

19,128

 

 

(6,451)

Income (loss) from unconsolidated entities

 

 

(83,125)

 

 

(10,357)

 

 

(21,504)

Income from continuing operations

 

 

196,363

 

 

718,024

 

 

608,162

Gain (loss) on real estate dispositions, net

 

 

344,250

 

 

364,046

 

 

280,387

Net income

 

 

540,613

 

 

1,082,070

 

 

888,549

Less:  Preferred stock dividends

 

 

49,410

 

 

65,406

 

 

65,406

Less:  Preferred stock redemption charge

 

 

9,769

 

 

-

 

 

-

Less:  Net income (loss) attributable to noncontrolling interests(1)

 

 

17,839

 

 

4,267

 

 

4,799

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to common stockholders

 

$

463,595

 

$

1,012,397

 

$

818,344

 

 

 

 

 

 

 

 

 

 

 

 

Average number of common shares outstanding:

 

 

 

 

 

 

 

 

 

 

Basic

 

 

367,237

 

 

358,275

 

 

348,240

 

Diluted

 

 

369,001

 

 

360,227

 

 

349,424

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.53

 

$

2.00

 

$

1.75

 

Net income attributable to common stockholders

 

$

1.26

 

$

2.83

 

$

2.35

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted:

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.53

 

$

1.99

 

$

1.74

 

Net income attributable to common stockholders

 

$

1.26

 

$

2.81

 

$

2.34

 

 

 

 

 

 

 

 

 

 

 (1) Includes amounts attributable to redeemable noncontrolling interests

See accompanying notes

 

54


CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (CONTINUED)

WELLTOWER INC. AND SUBSIDIARIES

(In thousands)

 

 

 

 

Year Ended December 31,

 

 

 

 

2017

 

2016

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

540,613

 

$

1,082,070

 

$

888,549

 

 

 

  

 

 

 

 

 

 

 

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

Unrecognized gain (loss) on equity investments

 

 

-

 

 

5,120

 

 

-

 

Reclassification adjustment for write down of equity investment

 

 

(5,120)

 

 

-

 

 

-

 

Unrecognized gain (loss) on cash flow hedges

 

 

2

 

 

1,414

 

 

(766)

 

Unrecognized actuarial gain (loss)

 

 

269

 

 

190

 

 

246

 

Foreign currency translation gain (loss)

 

 

85,263

 

 

(85,557)

 

 

(46,679)

Total other comprehensive income (loss)

 

 

80,414

 

 

(78,833)

 

 

(47,199)

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive income

 

 

621,027

 

 

1,003,237

 

 

841,350

Less: Total comprehensive income (loss) attributable to noncontrolling interests(1)

 

 

40,187

 

 

6,722

 

 

(31,166)

Total comprehensive income attributable to stockholders

 

$

580,840

 

$

996,515

 

$

872,516

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes amounts attributable to redeemable noncontrolling interests.

 

 

 

 

See accompanying notes

 

55


CONSOLIDATED STATEMENTS OF EQUITY

WELLTOWER INC. AND SUBSIDIARIES

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital in

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

Preferred

Common

Excess of

Treasury

Cumulative

Cumulative

Comprehensive

Other

Noncontrolling

 

 

 

 

 

Stock

Stock

Par Value

Stock

Net Income

Dividends

Income (Loss)

Equity

Interests

Total

Balances at December 31, 2014

$

1,006,250

$

328,835

$

14,740,712

$

(35,241)

$

2,842,022

$

(5,635,923)

$

(77,009)

$

5,507

$

297,896

$

13,473,049

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

883,750

 

 

 

 

 

 

 

4,878

 

888,628

 

Other comprehensive income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

(11,234)

 

 

 

(35,965)

 

(47,199)

Total comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

841,429

Net change in noncontrolling interests

 

 

 

 

 

(23,077)

 

 

 

 

 

 

 

 

 

 

 

318,516

 

295,439

Amounts related to issuance of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

from dividend reinvestment and stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

incentive plans, net of forfeitures

 

 

 

126

 

25,053

 

(9,131)

 

 

 

 

 

 

 

(2,107)

 

 

 

13,941

Net proceeds from issuance of common stock

 

 

 

24,520

 

1,730,181

 

 

 

 

 

 

 

 

 

 

 

 

 

1,754,701

Equity component of convertible debt

 

 

 

1,330

 

5,431

 

 

 

 

 

 

 

 

 

 

 

 

 

6,761

Option compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

698

 

 

 

698

Cash dividends paid:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock dividends

 

 

 

 

 

 

 

 

 

 

 

(1,144,727)

 

 

 

 

 

 

 

(1,144,727)

 

Preferred stock dividends

 

 

 

 

 

 

 

 

 

 

 

(65,406)

 

 

 

 

 

 

 

(65,406)

Balances at December 31, 2015

 

1,006,250

 

354,811

 

16,478,300

 

(44,372)

 

3,725,772

 

(6,846,056)

 

(88,243)

 

4,098

 

585,325

 

15,175,885

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

1,077,803

 

 

 

 

 

 

 

9,277

 

1,087,080

 

Other comprehensive income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

(81,288)

 

 

 

2,455

 

(78,833)

Total comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,008,247

Net change in noncontrolling interests

 

 

 

 

 

(51,478)

 

 

 

 

 

 

 

 

 

 

 

(121,978)

 

(173,456)

Amounts related to issuance of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

from dividend reinvestment and stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

incentive plans, net of forfeitures

 

 

 

839

 

46,938

 

(10,369)

 

 

 

 

 

 

 

(1,305)

 

 

 

36,103

Net proceeds from issuance of common stock

 

 

 

7,421

 

525,931

 

 

 

 

 

 

 

 

 

 

 

 

 

533,352

Option compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

266

 

 

 

266

Cash dividends paid:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock dividends

 

 

 

 

 

 

 

 

 

 

 

(1,233,519)

 

 

 

 

 

 

 

(1,233,519)

 

Preferred stock dividends

 

 

 

 

 

 

 

 

 

 

 

(65,406)

 

 

 

 

 

 

 

(65,406)

Balances at December 31, 2016

 

1,006,250

 

363,071

 

16,999,691

 

(54,741)

 

4,803,575

 

(8,144,981)

 

(169,531)

 

3,059

 

475,079

 

15,281,472

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

522,774

 

 

 

 

 

 

 

20,819

 

543,593

 

Other comprehensive income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

58,066

 

 

 

22,348

 

80,414

Total comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

624,007

Net change in noncontrolling interests

 

 

 

  

 

13,473

 

 

 

 

 

 

 

 

 

 

 

(15,941)

 

(2,468)

Amounts related to issuance of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

from dividend reinvestment and stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

incentive plans, net of forfeitures

 

 

 

402

 

21,494

 

(9,807)

 

 

 

 

 

 

 

(2,399)

 

 

 

9,690

Net proceeds from issuance of common stock

 

 

 

8,881

 

612,555

 

 

 

 

 

 

 

 

 

 

 

 

 

621,436

Redemption of equity membership units

 

  

 

91

 

5,465

 

(11)

 

 

 

 

 

 

 

 

 

 

 

5,545

Redemption of preferred stock

 

(287,500)

 

 

 

9,760

 

 

 

(9,769)

 

  

 

 

 

 

 

 

 

(287,509)

Conversion of preferred stock

 

(247)

 

4

 

243

 

 

 

 

 

 

 

 

 

 

 

 

 

-

Option compensation expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10

 

 

 

10

Cash dividends paid:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock dividends

 

 

 

 

 

 

 

 

 

 

 

(1,277,321)

 

 

 

 

 

 

 

(1,277,321)

 

Preferred stock dividends

 

 

 

 

 

 

 

 

 

 

 

(49,410)

 

 

 

 

 

 

 

(49,410)

Balances at December 31, 2017

$

718,503

$

372,449

$

17,662,681

$

(64,559)

$

5,316,580

$

(9,471,712)

$

(111,465)

$

670

$

502,305

$

14,925,452

 

See accompanying notes

 

56


CONSOLIDATED STATEMENTS OF CASH FLOWS

WELLTOWER INC. AND SUBSIDIARIES

(in thousands)

 

 

 

 

  

Year Ended December 31,

 

  

2017

 

2016

 

2015

Operating activities:

  

 

 

 

 

 

 

 

 

Net income

  

$

540,613

 

$

1,082,070

 

$

888,549

Adjustments to reconcile net income to

  

 

 

 

 

 

 

 

 

 

net cash provided from (used in) operating activities:

  

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

  

 

921,720

 

 

901,242

 

 

826,240

 

 

Other amortization expenses

  

 

16,521

 

 

8,822

 

 

4,991

 

 

Provision for loan losses

  

 

62,966

 

 

10,215

 

 

-

 

 

Impairment of assets

  

 

124,483

 

 

37,207

 

 

2,220

 

 

Stock-based compensation expense

  

 

19,102

 

 

28,869

 

 

30,844

 

 

Loss (gain) on derivatives, net

  

 

2,284

 

 

(2,448)

 

 

(58,427)

 

 

Loss (gain) on extinguishment of debt, net

  

 

37,241

 

 

17,214

 

 

34,677

 

 

Loss (income) from unconsolidated entities

 

 

83,125

 

 

10,357

 

 

21,504

 

 

Rental income in excess of cash received

  

 

(80,398)

 

 

(83,233)

 

 

(115,756)

 

 

Amortization related to above (below) market leases, net

  

 

357

 

 

322

 

 

4,018

 

 

Loss (gain) on sales of properties, net

  

 

(344,250)

 

 

(364,046)

 

 

(280,387)

 

 

Other (income) expense, net

 

 

2

 

 

(4,853)

 

 

31,979

 

 

Distributions by unconsolidated entities

  

 

116

 

 

1,065

 

 

637

 

 

Increase (decrease) in accrued expenses and other liabilities

  

 

26,809

 

 

14,298

 

 

(8,968)

 

 

Decrease (increase) in receivables and other assets

  

 

23,486

 

 

(18,037)

 

 

478

Net cash provided from (used in) operating activities

  

 

1,434,177

 

 

1,639,064

 

 

1,382,599

 

 

 

 

  

 

 

 

 

 

 

 

 

Investing activities:

  

 

 

 

 

 

 

 

 

 

Cash disbursed for acquisitions

  

 

(805,264)

 

 

(2,145,374)

 

 

(3,353,087)

 

Cash disbursed for capital improvements to existing properties

 

 

(250,276)

 

 

(219,146)

 

 

(187,752)

 

Cash disbursed for construction in progress

 

 

(232,715)

 

 

(403,131)

 

 

(244,561)

 

Capitalized interest

  

 

(13,489)

 

 

(16,943)

 

 

(8,670)

 

Investment in real estate loans receivable

  

 

(83,738)

 

 

(129,884)

 

 

(598,722)

 

Other investments, net of payments

  

 

57,385

 

 

4,760

 

 

(141,994)

 

Principal collected on real estate loans receivable

  

 

96,023

 

 

249,552

 

 

131,830

 

Contributions to unconsolidated entities

  

 

(114,365)

 

 

(101,415)

 

 

(160,323)

 

Distributions by unconsolidated entities

 

 

70,287

 

 

119,723

 

 

130,880

 

Proceeds from (payments on) derivatives

 

 

52,719

 

 

108,347

 

 

106,360

 

Proceeds from sales of real property

  

 

1,378,014

 

 

2,350,068

 

 

823,964

Net cash provided from (used in) investing activities

  

 

154,581

 

 

(183,443)

 

 

(3,502,075)

 

 

 

 

  

 

 

 

 

 

 

 

 

Financing activities:

  

 

 

 

 

 

 

 

 

 

Net increase (decrease) under unsecured credit facilities

  

 

74,000

 

 

(190,000)

 

 

835,000

 

Proceeds from issuance of senior unsecured notes

  

 

7,500

 

 

693,560

 

 

1,451,434

 

Payments to extinguish senior unsecured notes

  

 

(5,000)

 

 

(865,863)

 

 

(558,830)

 

Net proceeds from the issuance of secured debt

  

 

241,772

 

 

460,015

 

 

228,685

 

Payments on secured debt

  

 

(1,144,346)

 

 

(563,759)

 

 

(573,390)

 

Net proceeds from the issuance of common stock

  

 

621,987

 

 

534,194

 

 

1,755,722

 

Redemption of preferred stock

  

 

(287,500)

 

 

-

 

 

-

 

Decrease (increase) in deferred loan expenses

  

 

(54,333)

 

 

(22,196)

 

 

(11,513)

 

Contributions by noncontrolling interests(1)

  

 

56,560

 

 

148,666

 

 

173,018

 

Distributions to noncontrolling interests(1)

  

 

(87,711)

 

 

(134,578)

 

 

(50,877)

 

Acquisitions of noncontrolling interests

 

 

-

 

 

-

 

 

(5,663)

 

Cash distributions to stockholders

  

 

(1,325,617)

 

 

(1,298,925)

 

 

(1,210,133)

 

Other financing activities

 

 

(10,839)

 

 

(11,931)

 

 

(36,135)

Net cash provided from (used in) financing activities

  

 

(1,913,527)

 

 

(1,250,817)

 

 

1,997,318

Effect of foreign currency translation on cash and cash equivalents

 

 

26,852

 

 

(20,274)

 

 

(8,575)

Increase (decrease) in cash, cash equivalents and restricted cash

  

 

(297,917)

 

 

184,530

 

 

(130,733)

Cash, cash equivalents and restricted cash at beginning of period

  

 

607,220

 

 

422,690

 

 

553,423

Cash, cash equivalents and restricted cash at end of period

  

$

309,303

 

$

607,220

 

$

422,690

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information:

 

 

 

 

 

 

 

 

 

 

Interest paid

 

$

488,265

 

$

541,545

 

$

492,771

 

Income taxes paid

 

 

10,410

 

 

8,011

 

 

12,214

(1)     Includes amounts attributable to redeemable noncontrolling interests.

 

See accompanying notes.

57


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

1. Business

 

     Welltower Inc., an S&P 500 company headquartered in Toledo, Ohio, is driving the transformation of health care infrastructure.  The Company invests with leading seniors housing operators, post-acute providers and health systems to fund the real estate and infrastructure needed to scale innovative care delivery models and improve people’s wellness and overall health care experience.  WelltowerTM, a real estate investment trust (“REIT”), owns interests in properties concentrated in major, high-growth markets in the United States (“U.S.”), Canada and the United Kingdom (“U.K.”), consisting of seniors housing and post-acute communities and outpatient medical properties.

 

2. Accounting Policies and Related Matters

Use of Estimates

     The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires us to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Principles of Consolidation

     The consolidated financial statements include the accounts of our wholly-owned subsidiaries and joint venture (“JV”) entities that we control, through voting rights or other means. All material intercompany transactions and balances have been eliminated in consolidation. At inception of JV transactions, we identify entities for which control is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and determine which business enterprise is the primary beneficiary of its operations. A VIE is broadly defined as an entity where either (i) the equity investors as a group, if any, do not have a controlling financial interest, or (ii) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support. We consolidate investments in VIEs when we are determined to be the primary beneficiary.  Accounting Standards Codification Topic 810, Consolidations (“ASC 810”), requires enterprises to perform a qualitative approach to determining whether or not a VIE will need to be consolidated. This evaluation is based on an enterprise’s ability to direct and influence the activities of a VIE that most significantly impact that entity’s economic performance. For investments in JVs, U.S. GAAP may preclude consolidation by the sole general partner in certain circumstances based on the type of rights held by the limited partner(s).  We assess the limited partners’ rights and their impact on our consolidation conclusions, and we reassess if there is a change to the terms or in the exercisability of the rights of the limited partners, the sole general partner increases or decreases its ownership of limited partnership interests, or there is an increase or decrease in the number of outstanding limited partnership interests. We similarly evaluate the rights of managing members of limited liability companies.

Revenue Recognition

     Revenue is recorded in accordance with U.S. GAAP, which requires that revenue be recognized after four basic criteria are met. These four criteria include persuasive evidence of an arrangement, the rendering of service, fixed and determinable income, and reasonably assured collectability. Interest income on loans is recognized as earned based upon the principal amount outstanding subject to an evaluation of collectability risk. Substantially all of our operating leases contain escalating rent structures. Leases with fixed annual rental escalators are generally recognized on a straight-line basis over the initial lease period, subject to a collectability assessment. Rental income related to leases with contingent rental escalators is generally recorded based on the contractual cash rental payments due for the period.  Leases in our outpatient medical portfolio typically include some form of operating expense reimbursement by the tenant.  Certain payments made to operators are treated as lease incentives and amortized as a reduction of revenue over the lease term.  We recognize resident fees and services, other than move-in fees, monthly as services are provided.  Lease agreements with residents generally have a term of one year and are cancelable by the resident with 30 days’ notice.

Cash and Cash Equivalents

     Cash and cash equivalents consist of all highly liquid investments with an original maturity of three months or less.

Restricted Cash

     Restricted cash primarily consists of amounts held by lenders to provide future payments for real estate taxes, insurance, tenant and capital improvements, amounts held in escrow relating to acquisitions we are entitled to receive over a period of time as outlined in the escrow agreement and net proceeds from property sales that were executed as tax-deferred dispositions under Internal Revenue Code (“IRC”) section 1031At December 31, 2017, $5,843,000 of sales proceeds is on deposit in a IRC section 1031 exchange escrow account with a qualified intermediary. 

Deferred Loan Expenses

     Deferred loan expenses are costs incurred by us in connection with the issuance, assumption and amendments of debt arrangements. Deferred loan expenses related to debt instruments, excluding the primary unsecured credit facility, are recorded as a reduction of the related debt liability.  Deferred loan expenses related to the primary unsecured credit facility are included in other assets.  We amortize these costs over the term of the debt using the straight-line method, which approximates the effective interest

58


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

method.

Investments in Unconsolidated Entities

     Investments in entities that we do not consolidate but have the ability to exercise significant influence over operating and financial policies are reported under the equity method of accounting.  Under the equity method, our share of the investee’s earnings or losses is included in our consolidated results of operations. The initial carrying value of investments in unconsolidated entities is based on the amount paid to purchase the entity interest inclusive of transaction costs.  To the extent that our cost basis is different from the basis reflected at the entity level, the basis difference is generally amortized over the lives of the related assets and liabilities, and such amortization is included in our share of equity in earnings of the entity.  We evaluate our equity method investments for impairment based upon a comparison of the estimated fair value of the equity method investment to its carrying value. When we determine a decline in the estimated fair value of such an investment below its carrying value is other-than-temporary, an impairment is recorded.

Marketable Securities

     We classify marketable securities as available-for-sale.  These securities are carried at their fair value with unrealized gains and losses recognized in stockholders’ equity as a component of accumulated other comprehensive income.  When we determine declines in fair value of marketable securities are other-than-temporary, a loss is recognized in earnings.

Redeemable Noncontrolling Interests

     Certain noncontrolling interests are redeemable at fair value.  Accordingly, we record the carrying amount of the noncontrolling interests at the greater of (i) the initial carrying amount, increased or decreased for the noncontrolling interest’s share of net income or loss and its share of other comprehensive income or loss, and dividends or (ii) the redemption value.  If it is probable that the interests will be redeemed in the future, we accrete the carrying value to the redemption value over the period until expected redemption, currently a weighted-average period of approximately four years.  In accordance with ASC 810, the redeemable noncontrolling interests are classified outside of permanent equity, as a mezzanine item, in the balance sheet.  At December 31, 2017, the current redemption value of redeemable noncontrolling interests exceeded the carrying value of $375,194,000 by $29,587,000.

     During 2014 and 2015, we entered into DownREIT partnerships which give a real estate seller the ability to exchange its property on a tax deferred basis for equity membership interests (“OP units”).  The OP units may be redeemed any time following the first anniversary of the date of issuance at the election of the holders for one share of our common stock per unit or, at our option, cash.

Real Property Owned

     On January 1, 2017, we adopted Accounting Standards Update (“ASU”) 2017-01, Clarifying the Definition of a Business (“ASU 2017-01”) which narrows the Financial Accounting Standards Board’s (“FASB”) definition of a business and provides a framework that gives entities a basis for making reasonable judgments about whether a transaction involves an asset or a business. ASU 2017-01 states that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the acquired asset is not a business. If this initial test is not met, an acquired asset cannot be considered a business unless it includes an input and a substantive process that together significantly contribute to the ability to create output. The primary differences between business combinations and asset acquisitions include recording the asset acquisition at relative fair value, capitalizing transaction costs, and the elimination of the measurement period in which to record adjustments to the transaction. We believe that substantially all our real estate acquisitions are considered asset acquisitions.  We are applying ASU 2017-01 prospectively for acquisitions after January 1, 2017. Real property developed by us is recorded at cost, including the capitalization of construction period interest. Expenditures for repairs and maintenance are expensed as incurred.

     Regardless of whether an acquisition is considered an asset acquisition or a business combination, the cost of real property acquired, which represents substantially all of the purchase price, is allocated to net tangible and identifiable intangible assets based on their relative fair values. These properties are depreciated on a straight-line basis over their estimated useful lives which range from 15 to 40 years for buildings and 5 to 15 years for improvements. Tangible assets primarily consist of land, buildings and improvements, including those related to capital leases.  We consider costs incurred in conjunction with re-leasing properties, including tenant improvements and lease commissions, to represent the acquisition of productive assets and, accordingly, such costs are reflected as investment activities in our consolidated statement of cash flows.

     The remaining purchase price is allocated among identifiable intangible assets primarily consisting of the above or below market component of in-place leases and the value associated with the presence of in-place leases.  The value allocable to the above or below market component of the acquired in-place lease is determined based upon the present value (using a discount rate which reflects the risks associated with the acquired leases) of the difference between (i) the contractual amounts to be paid pursuant to the lease over its remaining term, and (ii) management’s estimate of the amounts that would be paid using fair market rates over the remaining term of the lease. The amounts allocated to above market leases are included in acquired lease intangibles and below market leases are included in other liabilities in the balance sheet and are amortized to rental income over the remaining terms of the respective leases or lease-up period.

     The total amount of other intangible assets acquired is further allocated to in-place lease values and customer relationship values for in-place tenants based on management’s evaluation of the specific characteristics of each tenant’s lease and our overall relationship with that respective tenant. Characteristics considered by management in allocating these values include the nature and extent of our

59


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals, among other factors.  The total amount of other intangible assets acquired is further allocated to in-place lease values for in-place residents with such value representing (i) value associated with lost revenue related to tenant reimbursable operating costs that would be incurred in an assumed re-leasing period, and (ii) value associated with lost rental revenue from existing leases during an assumed re-leasing period.  This intangible asset will be amortized over the remaining life of the lease.

     The net book value of long-lived assets is reviewed quarterly on a property by property basis to determine if facts and circumstances suggest that the assets may be impaired or that the depreciable life may need to be changed. We consider external factors relating to each asset and the existence of a master lease which may link the cash flows of an individual asset to a larger portfolio of assets leased to the same tenant. If these factors and the projected undiscounted cash flows of the assets over the remaining depreciation period indicate that the assets will not be recoverable, the carrying value is reduced to the estimated fair market value.  In addition, we are exposed to the risks inherent in concentrating investments in real estate, and in particular, the seniors housing and health care industries. A downturn in the real estate industry could adversely affect the value of our properties and our ability to sell properties for a price or on terms acceptable to us.  Additionally, properties that meet the held-for-sale criteria are recorded at the lessor of fair value less costs to sell or the carrying value.

Capitalization of Construction Period Interest

     We capitalize interest costs associated with funds used for the construction of properties owned directly by us. The amount capitalized is based upon the balance outstanding during the construction period using the rate of interest which approximates our Company-wide cost of financing. Our interest expense reflected in the consolidated statements of comprehensive income has been reduced by the amounts capitalized.

Gain on Real Estate Dispositions

     We recognize sales of real estate assets only upon the closing of the transaction with the purchaser. Payments received from purchasers prior to closing are recorded as deposits and classified as other assets on our consolidated balance sheets. Gains on real estate assets sold are recognized using the full accrual method upon closing when (i) the collectability of the sales price is reasonably assured, (ii) we are not obligated to perform significant activities after the sale to earn the profit, (iii) we have received adequate initial investment from the purchaser, and (iv) other profit recognition criteria have been satisfied. Gains may be deferred in whole or in part until the sales satisfy the requirements of gain recognition on sales of real estate.

Real Estate Loans Receivable

     Real estate loans receivable consist of mortgage loans and other real estate loans. Interest income on loans is recognized as earned based upon the principal amount outstanding subject to an evaluation of collectability risks. The loans are primarily collateralized by a first, second or third mortgage lien, a leasehold mortgage on, or an assignment of the partnership interest in, the related properties, corporate guaranties and/or personal guaranties.

Allowance for Losses on Loans Receivable

     The allowance for losses on loans receivable is maintained at a level believed adequate to absorb potential losses in our loans receivable. The determination of the allowance is based on a quarterly evaluation of these loans, including general economic conditions and estimated collectability of loan payments. We evaluate the collectability of our loans receivable based on a combination of factors, including, but not limited to, delinquency status, historical loan charge-offs, financial strength of the borrower and guarantors, and value of the underlying collateral. If such factors indicate that there is greater risk of loan charge-offs, additional allowances or placement on non-accrual status may be required. A loan is impaired when, based on current information and events, it is probable that we will be unable to collect all amounts due as scheduled according to the contractual terms of the original loan agreement. Consistent with this definition, all loans on non-accrual are deemed impaired. To the extent circumstances improve and the risk of collectability is diminished, we will return these loans to income accrual status. While a loan is on non-accrual status, any cash receipts are applied against the outstanding principal balance.  Any loans with collectability concerns are subjected to a projected payoff valuation.  The valuation is based on the expected future cash flows and/or the estimated fair value of the underlying collateral.  The valuation is compared to the outstanding balance to determine the reserve needed for each loan.  We may base our valuation on a loan’s observable market price, if any, or the fair value of collateral, net of sales costs, if the repayment of the loan is expected to be provided solely by the collateral.

Goodwill

    We account for goodwill in accordance with U.S. GAAP. Goodwill is tested annually for impairment and is tested for impairment more frequently if events and circumstances indicate that the asset might be impaired. An impairment loss is recognized to the extent that the carrying amount, including goodwill, exceeds the reporting unit’s fair value and the implied fair value of goodwill is less than the carrying amount of that goodwill.  We have not had any goodwill impairments.

 Fair Value of Derivative Instruments

     Derivatives are recorded at fair value on the balance sheet as assets or liabilities.  The valuation of derivative instruments requires us to make estimates and judgments that affect the fair value of the instruments.  Fair values of our derivatives are estimated by

60


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

pricing models that consider the forward yield curves and discount rates.  The fair value of our forward exchange contracts are estimated by pricing models that consider foreign currency spot rates, forward trade rates and discount rates.  Such amounts and the recognition of such amounts are subject to significant estimates that may change in the future. See Note 11 for additional information.

Federal Income Tax

    We have elected to be treated as a REIT under the applicable provisions of the IRC, commencing with our first taxable year, and made no provision for U.S. federal income tax purposes prior to our acquisition of our taxable REIT subsidiaries (“TRSs”). As a result of these as well as subsequent acquisitions, we now record income tax expense or benefit with respect to certain of our entities that are taxed as TRSs under provisions similar to those applicable to regular corporations and not under the REIT provisions. We account for deferred income taxes using the asset and liability method and recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in our consolidated financial statements or tax returns. Under this method, we determine deferred tax assets and liabilities based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Any increase or decrease in the deferred tax liability that results from a change in circumstances, and that causes a change in our judgment about expected future tax consequences of events, is included in the tax provision when such changes occur. Deferred income taxes also reflect the impact of operating loss and tax credit carryforwards. A valuation allowance is provided if we believe it is more likely than not that all or some portion of the deferred tax asset will not be realized. Any increase or decrease in the valuation allowance that results from a change in circumstances, and that causes a change in our judgment about the realizability of the related deferred tax asset, is included in the tax provision when such changes occur.  See Note 18 for additional information.

Foreign Currency

    Certain of our subsidiaries’ functional currencies are the local currencies of their respective countries. We translate the results of operations of our foreign subsidiaries into U.S. dollars using average rates of exchange in effect during the period, and we translate balance sheet accounts using exchange rates in effect at the end of the period. We record resulting currency translation adjustments in accumulated other comprehensive income, a component of stockholders’ equity, on our consolidated balance sheets. We record transaction gains and losses in our consolidated statements of comprehensive income.

Earnings Per Share

     Basic earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of shares outstanding for the period adjusted for non-vested shares of restricted stock. The computation of diluted earnings per share is similar to basic earnings per share, except that the number of shares is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common shares had been issued.

Reclassifications

     Certain amounts in prior years have been reclassified to conform to current year presentation.

New Accounting Standards

     During the year ended December 31, 2017, we adopted the following additional accounting standards, each of which did not have a material impact on our consolidated financial statements:

·          We adopted ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting” on January 1, 2017, which allows companies to make a policy election as to whether they will include an estimate of awards expected to be forfeited or whether they will account for forfeitures as they occur.  We elected to account for forfeitures as they occur. This election had an immaterial impact on our consolidated financial statements.  The standard also requires an employer to classify as a financing activity in the consolidated statement of cash flow the cash paid to a tax authority when shares are withheld to satisfy the employer’s statutory income tax withholding obligation.  This aspect of the standard is required to be applied on a retrospective basis and resulted in an increase in net cash provided by operating activities and a decrease in net cash used in financing activities of $10,369,000 and $9,131,000 for the years ended December 31, 2016 and 2015, respectively.  Upon adoption, no other provisions of ASU 2016-09 had an effect on our consolidated financial statements or related footnote disclosures.

 

·          During the three months ended December 31, 2017, we adopted ASU No. 2016-18, “Restricted Cash,” and ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments.”  ASU No. 2016-18 requires an entity to reconcile and explain the period over period change in total cash, cash equivalents and restricted cash within its consolidated statement of cash flows and ASU 2016-15 provides guidance clarifying how certain cash receipts and cash payments should be classified.  We adopted these accounting standards retrospectively and, accordingly, certain line items in the consolidated statement of cash flows have been reclassified to conform to the current presentation.  The following table summarizes the change in cash flows as reported and as previously reported prior to the adoption of these standards (in thousands):

61


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

  

December 31, 2016

 

December 31, 2015

 

 

 

 

 

 

 

As Previously

 

 

 

 

 

As Previously

 

 

 

As Reported

 

 

Reported

 

As Reported

 

 

Reported

 

Cash disbursed for acquisitions

 

$

(2,145,374)

 

$

(2,145,590)

 

$

(3,353,087)

 

$

(3,364,891)

 

Decrease (increase) in restricted cash

 

 

-

 

 

(125,844)

 

 

-

 

 

29,719

 

Net cash provided from (used in) investing activities

 

 

(183,443)

 

 

(309,503)

 

 

(3,502,075)

 

 

(3,484,160)

 

Increase (decrease) in balance(1)

 

 

184,530

 

 

58,470

 

 

(130,733)

 

 

(112,818)

 

Balance at beginning of period(1)

 

 

422,690

 

 

360,908

 

 

553,423

 

 

473,726

 

Balance at end of period(1)

 

 

607,220

 

 

419,378

 

 

422,690

 

 

360,908

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Amounts in As Reported column include cash and cash equivalents and restricted cash as required.  Amounts in the As Previously Reported column reflect only cash and cash equivalents.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

      The following ASUs have been issued but not yet adopted:    

·          In 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (ASC 606),” which is a comprehensive new revenue recognition model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services.  ASC 606 is effective for us beginning January 1, 2018 and we will use the modified retrospective method of adoption. 

 

We have evaluated our various revenue streams to identify whether they would be subject to the provisions of ASC 606 and any differences in timing, measurement, or presentation of revenue recognition.  A significant source of our revenue is generated through leasing arrangements, which are specifically excluded from ASU 2014-09.  Management contracts are present in our seniors housing operating and outpatient medical segments and represent agreements to provide asset and property management, leasing, marketing and other services.  We do not believe that the pattern and timing of recognition of income for these contracts will change under the provisions of ASC 606.  In addition, revenue recognition for real estate sales is mainly based on the transfer of control and when it is probable that we will collect substantially all of the related consideration.  We expect that the new guidance will result in more transactions qualifying as sales of real estate and being recognized at an earlier date than under the current guidance.

 

·         In 2016, the FASB issued ASU No. 2016-01, “Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities,” which will require entities to measure their financial instrument investments at fair value and recognize any changes in fair value in net income unless the investments qualify for the new practicability exception.  The practicability exception will be available for equity investments that do not have readily determinable fair values.  ASU 2016-01 is effective for fiscal years and interim periods within those years, beginning after December 15, 2017.  This standard will require us to recognize gains and losses from changes in the fair value of our available-for-sale equity securities through the consolidated statement of comprehensive income rather than through accumulated other comprehensive income beginning in 2018.

 

·          In 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” which requires lessees to recognize assets and liabilities on their consolidated balance sheet related to the rights and obligations created by most leases, while continuing to recognize expenses on their consolidated statements of comprehensive income over the lease term.  It will also require disclosures designed to give financial statement users information regarding amount, timing, and uncertainty of cash flows arising from leases.  The FASB issued an Exposure Draft in January 2018 proposing to amend ASU 2016-02, which would provide lessors with a practical expedient, by class of underlying assets, to not separate non-lease components from the related lease components and, instead, to account for those components as a single lease component, if certain criteria are met.  ASU 2016-02 and the Exposure Draft are effective for us beginning January 1, 2019, with early adoption permitted.  Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the consolidated financial statements.  We are currently evaluating the impact of this guidance on our consolidated financial statements from both the lessee and lessor perspective.  We believe that adoption will likely have a material impact to our consolidated financial statements for the recognition of certain operating leases as right-of-use assets and lease liabilities and related amortizations.  We expect to utilize the practical expedients proposed in the Exposure Draft as part of our adoption of this guidance.

 

·         In 2016, the FASB issued ASU No. 2016-13, “Measurement of Credit Losses on Financial Instruments.”  This standard requires a new forward-looking “expected loss” model to be used for receivables, held-to-maturity debt, loans, and other instruments.  ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019, and early adoption is permitted for fiscal years beginning after December 15, 2018.  We are currently evaluating the impact that the standard will have on our consolidated financial statements.

62


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

·         In 2017, the FASB issued ASU No. 2017-05, “Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets.”  The standard clarifies that a financial asset is within the scope of Subtopic 610-20 if it meets the definition of an in substance nonfinancial asset.  The standard also defines the term in substance nonfinancial asset and clarifies that an entity should identify each distinct nonfinancial asset or in substance nonfinancial asset promised to a counterparty and derecognize each asset when a counterparty obtains control over it.  ASU 2017-05 is effective for annual periods beginning after December 15, 2017 and interim periods therein.  Entities may use either a full or modified adoption approach.  We are assessing the impact of the standard but do not expect it to have a material impact on our consolidated financial statements or disclosures.

  

 

3. Real Property Acquisitions and Development

 

    The total purchase price for all properties acquired has been allocated to the tangible and identifiable intangible assets, liabilities and noncontrolling interests based upon their relative fair values in accordance with our accounting policies. The results of operations for these acquisitions have been included in our consolidated results of operations since the date of acquisition and are a component of the appropriate segments.  Transaction costs primarily represent costs incurred with property acquisitions, including due diligence costs, fees for legal and valuation services, termination of pre-existing relationships computed based on the fair value of the assets acquired, lease termination fees, and other acquisition-related costs.  Effective January 1, 2017, with our adoption of ASU 2017-01, transaction costs incurred for asset acquisitions are capitalized as a component of purchase price and all other non-capitalizable costs are reflected in “Other Expenses” on our consolidated statement of comprehensive income.  Acquisitions that occurred prior to January 1, 2017, were accounted for as business combinations.  Certain of our subsidiaries’ functional currencies are the local currencies of their respective countries.  See Notes 2 and 11 for information regarding our foreign currency policies.  During the year ended December 31, 2017, we finalized our purchase price allocation of certain previously reported acquisitions and there were no material changes from those previously disclosed.

 

     Triple-Net Activity

 

     The following provides our purchase price allocations and other triple-net real property investment activity for the periods presented (in thousands):

 

 

 

Year Ended December 31,

 

 

 

 

2017

 

 

2016

 

 

2015

Land and land improvements  

 

$

 33,416   

 

$

104,754

 

$

95,835

Buildings and improvements  

 

 

 248,459   

 

 

418,633

 

 

1,061,431

Acquired lease intangibles  

 

 

 -   

 

 

2,876

 

 

4,408

Receivables and other assets  

 

 

 -   

 

 

551

 

 

194

 

Total assets acquired(1)

 

 

 281,875   

 

 

526,814

 

 

1,161,868

Secured debt  

 

 

-

 

 

-

 

 

(47,741)

Accrued expenses and other liabilities

 

 

(21,236)

 

 

(3,384)

 

 

(2,905)

 

Total liabilities assumed

 

 

(21,236)

 

 

(3,384)

 

 

(50,646)

Noncontrolling interests

 

 

(7,275)

 

 

(26,771)

 

 

(13,465)

Non-cash acquisition related activity(2)

 

 

(54,901)

 

 

(51,733)

 

 

(38,355)

 

Cash disbursed for acquisitions

 

 

198,463

 

 

444,926

 

 

1,059,402

Construction in progress additions

 

 

120,797

 

 

181,084

 

 

143,140

Less:  Capitalized interest

 

 

(4,713)

 

 

(8,729)

 

 

(5,699)

          Accruals

    Foreign currency translation

 

 

(610)

 

 

(3,665)

 

 

(167)

Cash disbursed for construction in progress

 

 

115,474

 

 

168,690

 

 

137,274

Capital improvements to existing properties

 

 

19,989

 

 

32,603

 

 

45,293

 

Total cash invested in real property, net of cash acquired  

 

$

 333,926   

 

$

646,219

 

$

1,241,969

 

 

 

 

 

 

 

 

 

 

 

 

(1) Excludes $318,000, $682,000 and $16,578,000 of cash and restricted cash acquired during the years ended December 31, 2017, 2016 and 2015, respectively. 

 

(2)  For the year ended December 31, 2017, $54,901,000 is related to the acquisition of assets previously financed as real estate loans receivable.  For the year ended December 31, 2016, primarily relates to $45,044,000 for the acquisition of assets previously financed as real estate loans receivable and $6,630,000 previously financed as an equity investment.  For the year ended December 31, 2015, primarily relates to $23,288,000 for the acquisition of assets previously financed as real estate loans receivable and $6,743,000 previously financed as equity investments.

 

Seniors Housing Operating Activity

     Acquisitions of seniors housing operating properties are structured under RIDEA, which is described in Note 18.  This structure results in the inclusion of all resident revenues and related property operating expenses from the operation of these qualified health care properties in our consolidated statements of comprehensive income. The following is a summary of our seniors housing operating real property investment activity for the periods presented (in thousands):

63


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

2017

 

 

2016

 

2015

Land and land improvements  

 

$

 42,525   

 

$

164,653

$

218,581

Buildings and improvements  

 

 

 428,777   

 

 

1,518,472

 

2,367,486

Acquired lease intangibles  

 

 

 63,912   

 

 

115,643

 

187,512

Receivables and other assets  

 

 

 3,959   

 

 

2,462

 

29,501

 

Total assets acquired(1)

 

 

 539,173   

 

 

1,801,230

 

2,803,080

Secured debt  

 

 

-

 

 

(63,732)

 

(871,471)

Senior unsecured notes

 

 

-

 

 

-

 

(24,621)

Accrued expenses and other liabilities

 

 

(46,301)

 

 

(23,681)

 

(81,778)

 

Total liabilities assumed

 

 

(46,301)

 

 

(87,413)

 

(977,870)

Noncontrolling interests

 

 

(4,701)

 

 

(6,007)

 

(183,854)

Non-cash acquisition related activity

 

 

 (67,633)(2)

 

 

 (47,065)(3)

 

-

     Cash disbursed for acquisitions

 

 

420,538

 

 

1,660,745

 

1,641,356

Construction in progress additions

 

 

84,874

 

 

157,845

 

44,173

Less:  Capitalized interest

 

 

(9,106)

 

 

(5,793)

 

(1,740)

Less:  Foreign currency translation

 

 

(6,830)

 

 

(8,500)

 

(2,499)

Cash disbursed for construction in progress

 

 

68,938

 

 

143,552

 

39,934

Capital improvements to existing properties

 

 

185,473

 

 

138,673

 

104,308

 

Total cash invested in real property, net of cash acquired  

 

$

 674,949   

 

$

1,942,970

$

1,785,598

 

 

 

 

 

 

 

 

 

 

 

(1) Excludes $6,273,000, $351,000 and $42,728,000 of cash and restricted cash acquired during the years ended December 31, 2017, 2016 and 2015, respectively.

 

(2) Includes $59,665,000 related to the acquisition of assets previously financed as investments in unconsolidated entities, and $6,349,000 related to the acquisition of assets previously financed as real estate loans receivable.

 

(3) Includes $43,372,000 related to the acquisition of assets previously financed as investments in unconsolidated entities.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

64


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

     Outpatient Medical Activity

 

     The following is a summary of our outpatient medical real property investment activity for the periods presented (in thousands):

 

 

 

Year Ended December 31,

 

 

 

 

2017

 

 

2016

 

 

2015

Land and land improvements  

 

$

 40,565   

 

$

5,738

 

$

223,708

Buildings and improvements  

 

 

 159,643   

 

 

46,056

 

 

614,770

Acquired lease intangibles  

 

 

 24,014   

 

 

4,592

 

 

45,226

Receivables and other assets  

 

 

 10   

 

 

-

 

 

939

 

Total assets acquired

 

 

 224,232   

 

 

56,386

 

 

884,643

Secured debt  

 

 

(25,708)

 

 

-

 

 

(120,977)

Accrued expenses and other liabilities

 

 

(3,181)

 

 

(1,670)

 

 

(7,777)

 

Total liabilities assumed

 

 

(28,889)

 

 

(1,670)

 

 

(128,754)

Noncontrolling interests

 

 

(9,080)

 

 

-

 

 

(76,535)

Non-cash acquisition related activity

 

 

 -    

 

 

 (15,013)(2)

 

 

 (27,025)(3)

     Cash disbursed for acquisitions(1)

 

 

186,263

 

 

39,703

 

 

652,329

Construction in progress additions

 

 

37,094

 

 

113,933

 

 

70,560

Less:  Capitalized interest

 

 

(2,406)

 

 

(3,723)

 

 

(1,286)

          Accruals(4)

 

 

13,615

 

 

(19,321)

 

 

(1,921)

Cash disbursed for construction in progress

 

 

48,303

 

 

90,889

 

 

67,353

Capital improvements to existing properties

 

 

44,814

 

 

47,870

 

 

38,151

 

Total cash invested in real property, net of cash acquired  

 

$

 279,380   

 

$

178,462

 

$

757,833

 

 

 

 

 

 

 

 

 

 

 

 

(1) Excludes $5,522,000 of cash acquired during the year ended December 31, 2015.

 

(2) The non-cash activity relates to the acquisition of assets previously financed as real estate loans.  Please refer to Note 6 for additional information.

 

(3) The non-cash activity relates to the acquisition of a controlling interest in a portfolio of properties that was historically reported as an unconsolidated property investment.

 

(4) Represents non-cash consideration accruals for amounts to be paid in future periods for properties that converted, off-set by amounts paid in the current period.

  

     Construction Activity

 

     The following is a summary of the construction projects that were placed into service and began generating revenues during the periods presented (in thousands):

 

 

 

 

Year Ended

 

 

 

 

December 31, 2017

 

December 31, 2016

 

December 31, 2015

 

Development projects:

 

 

 

 

 

 

 

 

 

 

 

Triple-net

 

$

283,472

 

$

46,094

 

$

104,844

 

 

Seniors housing operating

 

 

3,634

 

 

18,979

 

 

19,869

 

 

Outpatient medical

 

 

63,036

 

 

108,001

 

 

16,592

 

 

Total development projects

 

 

350,142

 

 

173,074

 

 

141,305

 

Expansion projects

 

 

10,336

 

 

11,363

 

 

38,808

Total construction in progress conversions

 

$

360,478

 

$

184,437

 

$

180,113

 

     At December 31, 2017, future minimum lease payments receivable under operating leases (excluding properties in our seniors housing operating partnerships and excluding any operating expense reimbursements) are as follows (in thousands):

2018

 

$

1,098,987

2019

 

 

1,056,731

2020

 

 

1,034,583

2021

 

 

980,716

2022

 

 

944,028

Thereafter

 

 

7,771,145

Totals

 

$

12,886,190

65


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

4. Real Estate Intangibles

 

     The following is a summary of our real estate intangibles, excluding those classified as held for sale, as of the dates indicated (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

December 31, 2017

 

December 31, 2016

Assets:

  

 

 

 

 

 

 

In place lease intangibles

  

$

1,352,139

 

$

1,252,143

 

Above market tenant leases

  

 

58,443

 

 

61,700

 

Below market ground leases

  

 

58,784

 

 

61,628

 

Lease commissions

  

 

33,105

 

 

27,413

 

Gross historical cost

  

 

1,502,471

 

 

1,402,884

 

Accumulated amortization

  

 

(1,125,437)

 

 

(966,714)

 

Net book value

  

$

377,034

 

$

436,170

 

 

  

 

 

 

 

 

 

Weighted-average amortization period in years

  

 

15.1

 

 

13.7

 

 

  

 

 

 

 

 

Liabilities:

  

 

 

 

 

 

 

Below market tenant leases

  

$

60,430

 

$

89,468

 

Above market ground leases

  

 

8,540

 

 

8,107

 

Gross historical cost

  

 

68,970

 

 

97,575

 

Accumulated amortization

  

 

(39,629)

 

 

(52,134)

 

Net book value

  

$

29,341

 

$

45,441

 

 

  

 

 

 

 

 

 

Weighted-average amortization period in years

  

 

20.1

 

 

15.2

 

 

 

 

 

 

 

 

     The following is a summary of real estate intangible amortization for the periods presented (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

2017

 

2016

 

2015

Rental income related to above/below market tenant leases, net

 

$

875

 

$

919

 

$

(2,746)

Property operating expenses related to above/below market ground leases, net

 

 

(1,231)

 

 

(1,241)

 

 

(1,272)

Depreciation and amortization related to in place lease intangibles and lease commissions

 

 

(145,132)

 

 

(132,141)

 

 

(115,855)

 

 

 

 

 

 

 

 

 

 

     The future estimated aggregate amortization of intangible assets and liabilities is as follows for the periods presented (in thousands):

 

 

 

Assets

 

 

Liabilities

2018

 

$

111,339

 

$

3,765

2019

 

 

55,336

 

 

3,306

2020

 

 

34,402

 

 

2,809

2021

 

 

20,419

 

 

2,321

2022

 

 

17,213

 

 

1,856

Thereafter

 

 

138,325

 

 

15,284

Totals

 

$

377,034

 

$

29,341

 

5. Dispositions, Assets Held for Sale and Discontinued Operations

We periodically sell properties for various reasons, including favorable market conditions, the exercise of tenant purchase options, or reduction of concentrations (e.g. property type, relationship, or geography).  At December 31, 2017, 50 triple-net, three seniors housing operating and 20 outpatient medical properties with an aggregate net real estate balance of $734,147,000 were classified as held for sale. Secured debt related to the held for sale properties totaled $66,872,000. Impairment of assets, as reflected in our consolidated statements of comprehensive income, primarily represents the charges necessary to adjust the carrying values of certain properties to estimated fair values less costs to sell.  The following is a summary of our real property disposition activity for the periods presented (in thousands):

66


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

 

December 31, 2017

 

December 31, 2016

 

December 31, 2015

Real property dispositions:

 

 

 

 

 

 

 

 

 

 

Triple-net

 

$

916,689

 

$

1,773,614

 

$

356,300

 

Seniors housing operating

 

 

74,832

 

 

-

 

 

-

 

Outpatient medical(1)

 

 

19,697

 

 

78,786

 

 

181,553

 

Land parcels

 

 

-

 

 

-

 

 

5,724

 

Total dispositions

 

 

1,011,218

 

 

1,852,400

 

 

543,577

Gain (loss) on sales of real property, net

 

 

344,250

 

 

364,046

 

 

280,387

Net other assets (liabilities) disposed

 

 

22,546

 

 

133,622

 

 

-

Proceeds from real property sales

 

$

1,378,014

 

$

2,350,068

 

$

823,964

 

 

 

 

 

 

 

 

 

 

 

 

(1) Dispositions occurring in the year ended December 31, 2015 primarily relate to the disposition of an unconsolidated equity investment with Forest City Enterprises.

 

 

 

 

 

 

 

 

 

 

 

During the year ended December 31, 2016, we completed two portfolio dispositions of properties leased to Genesis HealthCare (“Genesis”) for which we received loans in the amount of $74,445,000 for termination fees relating to the properties sold under the master lease.  The related termination fee income has been deferred and will be recognized as the principal balance of the loans are repaid.  At December 31, 2017, $61,994,000 of principal is outstanding on the loans. 

 

Dispositions and Assets Held for Sale

 

Pursuant to our adoption of ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (ASU 2014-08”), operating results attributable to properties sold subsequent to or classified as held for sale after January 1, 2014 and which do not meet the definition of discontinued operations are no longer reclassified on our consolidated statements of comprehensive income.  The following represents the activity related to these properties for the periods presented (in thousands):

 

 

 

Year Ended

 

 

 

 

December 31,

 

 

 

 

2017

 

2016

 

2015

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

Rental income

 

$

120,681

 

$

401,742

 

$

435,404

 

Expenses:

 

  

 

 

 

 

 

 

 

 

 

Interest expense

 

  

6,570

 

 

47,083

 

 

68,978

 

 

Property operating expenses

 

  

12,402

 

 

20,847

 

 

22,313

 

 

Provision for depreciation

 

  

31,736

 

 

98,949

 

 

114,869

 

 

Total expenses

 

 

50,708

 

 

166,879

 

 

206,160

 

Income (loss) from real estate dispositions, net

 

$

69,973

 

$

234,863

 

$

229,244

 

 

6. Real Estate Loans Receivable

     The following is a summary of our real estate loans receivable (in thousands):

 

 

 

 

December 31,

 

 

 

2017

 

2016

Mortgage loans

 

$

374,492

 

$

485,735

Other real estate loans

 

 

121,379

 

 

136,893

Totals

 

$

495,871

 

$

622,628

     The following is a summary of our real estate loan activity for the periods presented (in thousands):

67


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

 

December 31, 2017

 

December 31, 2016

 

December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outpatient

 

 

 

 

Outpatient

 

 

 

 

Outpatient

 

 

 

 

 

Triple-net

Medical

Totals

 

Triple-net

Medical

Totals

 

Triple-net

Medical

Totals

Advances on real estate loans receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments in new loans

 

$

12,091

$

-

$

12,091

 

$

8,445

$

-

$

8,445

 

$

530,497

$

-

$

530,497

 

Draws on existing loans

 

 

71,647

 

-

 

71,647

 

 

118,788

 

2,651

 

121,439

 

 

65,614

 

2,611

 

68,225

 

Net cash advances on real estate loans

 

 

83,738

 

-

 

83,738

 

 

127,233

 

2,651

 

129,884

 

 

596,111

 

2,611

 

598,722

Receipts on real estate loans receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan payoffs

 

 

157,912

 

60,500

 

218,412

 

 

275,439

 

27,303

 

302,742

 

 

121,778

 

-

 

121,778

 

Principal payments on loans

 

 

1,219

 

-

 

1,219

 

 

6,867

 

-

 

6,867

 

 

33,340

 

-

 

33,340

 

   Sub-total

 

 

159,131

 

60,500

 

219,631

 

 

282,306

 

27,303

 

309,609

 

 

155,118

 

-

 

155,118

 

Less: Non-cash activity(1)

 

 

(63,108)

 

(60,500)

 

(123,608)

 

 

(45,044)

 

(15,013)

 

(60,057)

 

 

(23,288)

 

-

 

(23,288)

 

Net cash receipts on real estate loans

 

 

96,023

 

-

 

96,023

 

 

237,262

 

12,290

 

249,552

 

 

131,830

 

-

 

131,830

Net cash advances (receipts) on real estate loans

 

 

(12,285)

 

-

 

(12,285)

 

 

(110,029)

 

(9,639)

 

(119,668)

 

 

464,281

 

2,611

 

466,892

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in balance due to foreign currency translation

 

9,136

 

-

 

9,136

 

 

(14,086)

 

-

 

(14,086)

 

 

(4,281)

 

-

 

(4,281)

Loan impairments(2)

 

 

-

 

-

 

-

 

 

-

 

(3,053)

 

(3,053)

 

 

-

 

-

 

-

Net change in real estate loans receivable

 

$

(66,257)

$

(60,500)

$

(126,757)

 

$

(169,159)

$

(27,705)

$

(196,864)

 

$

436,712

$

2,611

$

439,323

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Primarily represents aquisitions of assets previously financed as a real estate loans.  Please see Note 3 for additional information.

 

(2) Represents a direct write down of an impaired loan receivable.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     In 2016, we restructured two existing real estate loans in the triple-net segment to Genesis.  The two existing loans, with a combined principal balance of $317,000,000, were scheduled to mature in 2017 and 2018.  These loans were restructured into four separate loans effective October 1, 2016.  Each loan had a five year term, a 10% interest rate and 25 basis point annual escalator.  We recorded a loan loss charge in the amount of $6,935,000 on one of the loans as the present value of expected future cash flows was less than the carrying value of the loan.  During 2017, we recorded a provision for loan loss of $62,966,000 relating to three real estate loans receivable to Genesis.  The allowance for losses on loans receivable for these three loans totals $68,372,000 and is deemed to be sufficient to absorb expected losses relating to the loans.  Such allowance was based on an estimation of expected future cash flows discounted at the effective interest rate for each loan. Please see Note 21 for additional information.

     The following is a summary of the allowance for losses on loans receivable for the periods presented (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

2017

 

2016

 

2015

Balance at beginning of  year

$

6,563

 

$

-

 

$

-

Provision for loan losses(1)

 

62,966

 

 

6,935

 

 

-

Change in present value

  

(1,157)

 

  

(372)

 

  

-

Balance at end of  year

$

68,372

 

$

6,563

 

$

-

 

 

 

 

 

 

 

 

 

 

(1) Excludes direct write down of an impaired loan receivable in 2016.

 

 

 

 

 

 

 

 

 

 


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

The following is a summary of our loan impairments (in thousands):

 

 

 

 

Year Ended December 31,

 

 

 

2017

 

2016

 

2015

Balance of impaired loans at end of  year

 

$

282,882

 

$

377,549

 

$

-

Allowance for loan losses

 

 

68,372

 

 

6,563

 

 

-

Balance of impaired loans not reserved

 

$

214,510

 

$

370,986

 

$

-

Average impaired loans for the year

 

$

330,216

 

$

188,775

 

$

10,500

Interest recognized on impaired loans(1)

 

 

27,793

 

 

8,707

 

 

-

 

 

 

 

 

 

 

 

 

 

 

(1) Represents cash interest recognized in the period since loans were identified as impaired.

 

 

 

 

 

 

 

7. Investments in Unconsolidated Entities

 

     We participate in a number of joint ventures, which generally invest in seniors housing and health care real estate.  The results of operations for these properties have been included in our consolidated results of operations from the date of acquisition by the joint ventures and are reflected in our consolidated statements of comprehensive income as income or loss from unconsolidated entities.  The following is a summary of our investments in unconsolidated entities (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

Percentage Ownership(1)

 

December 31, 2017

 

December 31, 2016

 

Triple-net

10% to 49%

 

$

22,856

 

$

27,005

 

Seniors housing operating

10% to 50%

 

 

352,430

 

 

407,172

 

Outpatient medical

43%

 

 

70,299

 

 

22,961

 

Total

 

 

$

445,585

 

$

457,138

 

(1) Excludes ownership of in substance real estate.

 

 

 

 

 

 

 

 

 

 

     During the year ended December 31, 2017, we increased our ownership in Sunrise Senior Living Management, Inc. (“Sunrise”) from 24% to 34%.  Sunrise provides comprehensive property management and accounting services with respect to certain of our seniors housing operating properties that Sunrise operates, for which we pay annual management fees pursuant to long-term management agreements.  Our management agreements with Sunrise have initial terms expiring through December 2032 plus, if applicable, optional renewal periods ranging from an additional 5 to 15 years depending on the property.  The management fees payable to Sunrise under the management agreements include a fee based on a percentage of revenues generated by the applicable properties plus, if applicable, positive or negative adjustments based on specified performance targets.  For the years ended December 31, 2017, 2016 and 2015, we recognized fees to Sunrise of $37,573,000, $37,751,000, and $36,403,000, respectively, the majority of which are reflected within property operating expenses in our consolidated statements of comprehensive income.

 

     At December 31, 2017, the aggregate unamortized basis difference of our joint venture investments of $110,063,000 is primarily attributable to the difference between the amount for which we purchased our interest in the entity, including transaction costs, and the historical carrying value of the net assets of the entity.  This difference is being amortized over the remaining useful life of the related assets and included in the reported amount of income from unconsolidated entities.

 

     Summary combined financial information for our investments in unconsolidated entities held for the periods presented is as follows (in thousands):

 

 

December 31, 2017

 

 

December 31, 2016

Net real estate investments

$

2,955,527

 

$

2,595,107

Other assets

 

2,582,943

 

 

2,298,503

Total assets

 

5,538,470

 

 

4,893,610

Total liabilities

 

4,037,145

 

 

3,588,007

Total equity

$

1,501,325

 

$

1,305,603

 

 

Year Ended December 31,

 

 

2017

 

 

 

2016

 

 

 

2015

Total revenues

$

2,074,139

 

 

$

1,867,464

 

 

$

2,947,993

Net income (loss)

 

(264,473)

 

 

 

(86,167)

 

 

 

(40,116)

 

8. Credit Concentration

69


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

     We use consolidated net operating income (“NOI”) as our credit concentration metric.  See Note 17 for additional information and reconciliation.  The following table summarizes certain information about our credit concentration for the year ended December 31, 2017, excluding our share of NOI in unconsolidated entities (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

Number of

 

Total

 

Percent of

Concentration by relationship:(1)

 

Properties

 

NOI

 

NOI(2)

 

Sunrise Senior Living(3)

 

158

 

$

315,409

 

14%

 

Genesis HealthCare

 

86

 

 

190,506

 

9%

 

Revera(3)

 

98

 

 

156,698

 

7%

 

Brookdale Senior Living

 

137

 

 

151,026

 

7%

 

Benchmark Senior Living

 

48

 

 

97,779

 

4%

 

Remaining portfolio

 

759

 

 

1,321,298

 

59%

 

Totals

 

1,286

 

$

2,232,716

 

100%

 

 

 

 

 

 

 

 

 

 

(1) Genesis HealthCare is in our triple-net segment. Sunrise Senior Living and Revera are in our seniors housing operating segment.  Brookdale Senior Living and Benchmark Senior Living are in both our triple-net and seniors housing operating segments.

 

(2) NOI with our top five relationships comprised 45% of total NOI for the year ending December 31, 2016.

 

(3) Revera owns a controlling interest in Sunrise Senior Living. For the year ended December 31, 2017, we recognized $1,032,562,000 of revenue from properties managed by Sunrise Senior Living.

 

 

 

 

 

 

 

 

 

9. Borrowings Under Credit Facilities and Related Items

     At December 31, 2017, we had a primary unsecured credit facility with a consortium of 29 banks that includes a $3,000,000,000 unsecured revolving credit facility, a $500,000,000 unsecured term credit facility, and a $250,000,000 Canadian-denominated unsecured term credit facility.  We have an option, through an accordion feature, to upsize the unsecured revolving credit facility and the $500,000,000 unsecured term credit facility by up to an additional $1,000,000,000, in the aggregate, and the $250,000,000 Canadian-denominated unsecured term credit facility by up to an additional $250,000,000.  The primary unsecured credit facility also allows us to borrow up to $1,000,000,000 in alternate currencies (none outstanding at December 31, 2017).  Borrowings under the unsecured revolving credit facility are subject to interest payable at the applicable margin over LIBOR interest rate (2.46% at December 31, 2017).  The applicable margin is based on certain of our debt ratings and was 0.90% at December 31, 2017.  In addition, we pay a facility fee quarterly to each bank based on the bank’s commitment amount.  The facility fee depends on certain of our debt ratings and was 0.15% at December 31, 2017.  The term credit facilities mature on May 13, 2021. The revolving credit facility is scheduled to mature on May 13, 2020 and can be extended for two successive terms of six months each at our option.

     The following information relates to aggregate borrowings under the primary unsecured revolving credit facility for the periods presented (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2017

 

2016

 

2015

Balance outstanding at year end(1)

 

$

719,000

 

$

645,000

 

$

835,000

Maximum amount outstanding at any month end

 

$

1,010,000

 

$

1,560,000

 

$

835,000

Average amount outstanding (total of daily

 

  

 

 

  

 

 

  

 

 

principal balances divided by days in period)

 

$

597,422

 

$

762,896

 

$

452,644

Weighted-average interest rate (actual interest

 

 

 

 

 

 

 

 

 

 

expense divided by average borrowings outstanding)

 

 

2.02%

 

 

1.39%

 

 

1.17%

 

 

 

 

 

 

 

 

 

 

 

(1) As of December 31, 2017, letters of credit in the aggregate amount of $22,365,000 have been issued, which reduce the available borrowing capacity on our primary unsecured revolving credit facility.

 

 

 

 

 

 

 

 

 

 

 

 

10. Senior Unsecured Notes and Secured Debt

We may repurchase, redeem or refinance senior unsecured notes from time to time, taking advantage of favorable market conditions when available. We may purchase senior notes for cash through open market purchases, privately negotiated transactions, a tender offer or, in some cases, through the early redemption of such securities pursuant to their terms.   The senior unsecured notes are redeemable at our option, at any time in whole or from time to time in part, at a redemption price equal to the sum of (1) the principal amount of the notes (or portion of such notes) being redeemed plus accrued and unpaid interest thereon up to the redemption date and (2) any “make-whole” amount due under the terms of the notes in connection with early redemptions.   Redemptions and repurchases of debt, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, and other factors.   At December 31, 2017, the annual principal payments due on these debt obligations were as follows (in thousands):

70


 

 

 

 

 

 

 

 

 

 

 

 

Senior

 

Secured

 

 

 

 

 

Unsecured Notes(1,2)

 

Debt (1,3)

 

Totals

2018

 

$

450,000

 

$

396,588

 

$

846,588

2019

 

 

600,000

 

 

522,458

 

 

1,122,458

2020

 

 

697,174

 

 

184,726

 

 

881,900

2021(4)

 

 

1,149,728

 

 

221,784

 

 

1,371,512

2022(5,6)

 

 

600,000

 

 

234,850

 

 

834,850

Thereafter(7,8,9,10)

 

 

4,920,545

 

 

1,058,002

 

 

5,978,547

Totals

 

$

8,417,447

 

$

2,618,408

 

$

11,035,855

 

 

 

 

 

 

 

 

 

 

(1) Amounts represent principal amounts due and do not include unamortized premiums/discounts, debt issuance costs, or other fair value adjustments as reflected on the consolidated balance sheet.

(2) Annual interest rates range from 2.1% to 6.5%.

(3) Annual interest rates range from 1.69% to 7.98%.  Carrying value of the properties securing the debt totaled $5,475,672,000 at December 31, 2017.

(4) In November 2015, one of our wholly-owned subsidiaries issued and we guaranteed $300,000,000 of Canadian-denominated 3.35% senior unsecured notes due 2020 (approximately $239,674,000 based on the Canadian/U.S. Dollar exchange rate on December 31, 2017).

(5) On May 13, 2016, we refinanced the funding on a $250,000,000 Canadian-denominated unsecured term credit facility (approximately $199,728,000 based on the Canadian/U.S. Dollar exchange rate on December 31, 2017).  The loan matures on May 13, 2021 and bears interest at the Canadian Dealer Offered Rate plus 95 basis points (2.28% at December 31, 2017).

(6) On May 13, 2016, we refinanced the funding on a $500,000,000 unsecured term credit facility.  The loan matures on May 13, 2021 and bears interest at LIBOR plus 95 basis points (2.41% at December 31, 2017).

(7)  On November 20, 2013, we completed the sale of £550,000,000 (approximately $744,095,000 based on the Pounds Sterling/U.S. Dollar exchange rate in effect on December 31, 2017) of 4.8% senior unsecured notes due 2028.

(8)  On November 25, 2014, we completed the sale of £500,000,000 (approximately $676,450,000 based on the Pounds Sterling/U.S. Dollar exchange rate in effect on December 31, 2017) of 4.5% senior unsecured notes due 2034.

(9)  In May 2015, we issued $750,000,000 of 4.0% senior unsecured notes due 2025.  In October 2015, we issued an additional $500,000,000 of these notes under a re-opening of the offer.

(10) In March 2016, we issued $700,000,000 of 4.25% senior unsecured notes due 2026. 

 

    The following is a summary of our senior unsecured note principal activity during the periods presented (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

December 31, 2017

 

December 31, 2016

 

December 31, 2015

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

Beginning balance

 $ 

8,260,038

 

4.245%

 

 $ 

8,645,758

 

4.237%

 

 $ 

7,817,154

 

4.385%

Debt issued

 

7,500

 

1.973%

 

 

705,000

 

4.228%

 

 

1,475,540

 

3.901%

Debt assumed

 

-

 

0.000%

 

 

-

 

0.000%

 

 

24,621

 

6.000%

Debt extinguished

  

(5,000)

 

1.830%

 

  

(850,000)

 

4.194%

 

  

(300,000)

 

6.200%

Debt redeemed

 

-

 

0.000%

 

 

-

 

0.000%

 

 

(240,249)

 

3.303%

Foreign currency

 

154,909

 

4.288%

 

 

(240,720)

 

4.565%

 

 

(131,308)

 

3.966%

Ending balance

 $ 

8,417,447

 

4.306%

 

 $ 

8,260,038

 

4.245%

 

 $ 

8,645,758

 

4.237%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     The following is a summary of our secured debt principal activity for the periods presented (dollars in thousands):  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

  

December 31, 2017

 

December 31, 2016

 

December 31, 2015

 

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

 

 

Weighted Avg.

 

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

 

Amount

 

Interest Rate

Beginning balance

 

$

3,465,066

 

4.094%

 

$

3,478,207

 

4.440%

 

$

2,941,765

 

4.940%

Debt issued

 

 

241,772

 

2.822%

 

 

460,015

 

2.646%

 

 

228,685

 

2.776%

Debt assumed

 

 

23,094

 

6.670%

 

 

60,898

 

4.301%

 

 

1,007,482

 

3.334%

Debt extinguished

 

 

(1,080,268)

 

5.247%

 

 

(489,293)

 

5.105%

 

 

(506,326)

 

4.506%

Principal payments

 

 

(64,078)

 

4.340%

 

 

(74,466)

 

4.663%

 

 

(67,064)

 

4.801%

Debt deconsolidated

 

 

(60,000)

 

3.799%

 

 

-

 

0.000%

 

 

-

 

0.000%

Foreign currency

 

 

92,822

 

3.164%

 

 

29,705

 

3.670%

 

 

(126,335)

 

3.834%

Ending balance

 

$

2,618,408

 

3.761%

 

$

3,465,066

 

4.094%

 

$

3,478,207

 

4.440%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Our debt agreements contain various covenants, restrictions and events of default. Certain agreements require us to maintain certain financial ratios and minimum net worth and impose certain limits on our ability to incur indebtedness, create liens and make investments or acquisitions. As of December 31, 2017, we believe we were in compliance with all of the covenants under our debt agreements.

71


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

11. Derivative Instruments

     We are exposed to various market risks, including the potential loss arising from adverse changes in interest rates. We may elect to use financial derivative instruments to hedge interest rate exposure. These decisions are principally based on our policy to manage the general trend in interest rates at the applicable dates and our perception of the future volatility of interest rates.  In addition, non-U.S. investments expose us to the potential losses associated with adverse changes in foreign currency to U.S. Dollar exchange rates.  We have elected to manage these risks through the use of forward exchange contracts and issuing debt in foreign currencies.

Interest Rate Swap Contracts and Foreign Currency Forward Contracts Designated as Cash Flow Hedges

     For instruments that are designated as and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income (“OCI”), and reclassified into earnings in the same period, or periods, during which the hedged transaction affects earnings.  Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in earnings.  Approximately $914,000 of gains, which are included in accumulated other comprehensive income (“AOCI”), are expected to be reclassified into earnings in the next 12 months.

Foreign Currency Hedges

     For instruments that are designated and qualify as net investment hedges, the variability in the foreign currency to U.S. dollar of the instrument is recorded as a cumulative translation adjustment component of OCI.  During the years ended December 31, 2017 and 2016, we settled certain net investment hedges generating cash proceeds of $52,719,000 and $108,347,000, respectively.  The balance of the cumulative translation adjustment will be reclassified to earnings when the hedged investment is sold or substantially liquidated. 

     The following presents the notional amount of derivatives and other financial instruments as of the dates indicated (in thousands):

 

 

 

 

 

 

 

 

December 31, 2017

 

December 31, 2016

Derivatives designated as net investment hedges:

 

 

 

 

Denominated in Canadian Dollars

$

575,000

$

900,000

Denominated in Pounds Sterling

£

550,000

£

550,000

 

 

 

 

 

Financial instruments designated as net investment hedges:

 

 

 

 

Denominated in Canadian Dollars

$

250,000

$

250,000

Denominated in Pounds Sterling

£

1,050,000

£

1,050,000

 

 

 

 

 

Derivatives designated as cash flow hedges:

 

 

 

 

Denominated in U.S. Dollars

$

-

$

57,000

Denominated in Canadian Dollars

$

36,000

$

54,000

Denominated in Pounds Sterling

£

-

£

48,000

 

 

 

 

 

Derivative instruments not designated:

 

 

 

 

Denominated in U.S. Dollars

$

408,007

$

-

Denominated in Canadian Dollars

$

80,000

$

37,000

 

 

 

 

 

 

 

 

 

 

     The following presents the impact of derivative instruments on the consolidated statements of comprehensive income for the periods presented (in thousands):

72


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

 

Location

 

December 31, 2017

 

December 31, 2016

 

December 31, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (loss) on forward exchange contracts recognized in income

 

Interest expense

 

$

(2,476)

 

$

8,544

 

$

14,474

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss (gain) on option exercise(1)

 

Loss (gain) on derivatives, net

 

$

-

 

$

-

 

$

(58,427)

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on release of cumulative translation adjustment related to ineffectiveness on net investment hedge

 

Loss (gain) on derivatives, net

 

$

-

 

$

(2,516)

 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (loss) on forward exchange contracts and term loans designated as net investment hedge recognized in OCI

 

OCI

 

$

(252,168)

 

$

357,021

 

$

298,116

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) In April 2011, we completed the acquisition of substantially all of the real estate assets of privately-owned Genesis.  In conjunction with this transaction, we received the option to acquire an ownership interest in Genesis.  In February 2015, Genesis closed on a transaction to merge with Skilled Healthcare Group to become a publicly traded company which required us to record the value of the derivative asset due to the net settlement feature.

 

12. Commitments and Contingencies

     At December 31, 2017, we had fourteen outstanding letter of credit obligations totaling $159,151,000 and expiring between 2018 and 2024.  At December 31, 2017, we had outstanding construction in process of $237,746,000 for leased properties and were committed to providing additional funds of approximately $429,815,000 to complete construction. At December 31, 2017, we had contingent purchase obligations totaling $11,832,000. These contingent purchase obligations relate to unfunded capital improvement obligations and contingent obligations on acquisitions. Rents due from the tenant are increased to reflect the additional investment in the property. In December 2017, we finalized an agreement with the University of Toledo Foundation to transfer our corporate headquarters as a gift and recognized an expense of $40,730,000.

     We evaluate our leases for operating versus capital lease treatment in accordance with ASC Topic 840 “Leases.”  A lease is classified as a capital lease if it provides for transfer of ownership of the leased asset at the end of the lease term, contains a bargain purchase option, has a lease term greater than 75% of the economic life of the leased asset, or if the net present value of the future minimum lease payments are in excess of 90% of the fair value of the leased asset. Certain leases contain bargain purchase options and have been classified as capital leases.  At December 31, 2017, we had operating lease obligations of $1,125,098,000 relating to certain ground leases and Company office space. Regarding the ground leases, we have sublease agreements with certain of our operators that require the operators to reimburse us for our monthly operating lease obligations. At December 31, 2017, aggregate future minimum rentals to be received under these noncancelable subleases totaled $77,385,000.

     At December 31, 2017, future minimum lease payments due under operating and capital leases are as follows (in thousands):

 

 

 

 

 

 

 

 

 

Operating Leases

 

Capital Leases(1)

2018

 

$

17,871

 

$

4,678

2019

 

 

18,070

 

 

4,334

2020

 

 

17,605

 

 

4,173

2021

 

 

17,419

 

 

4,173

2022

 

 

16,765

 

 

4,173

Thereafter

 

 

1,037,368

 

 

67,573

Totals

 

$

1,125,098

 

$

89,104

 

 

 

 

 

 

 

(1) Amounts above represent principal and interest obligations under capital lease arrangements.  Related assets with a gross value of $167,324,000 and accumulated depreciation of $29,303,000 are recorded in real property.

 

 

 

 

 

 

 

13. Stockholders’ Equity

 

     The following is a summary of our stockholder’s equity capital accounts as of the dates indicated:

73


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

December 31, 2017

 

December 31, 2016

Preferred Stock, $1.00 par value:

 

 

 

 

 

Authorized shares

 

50,000,000

 

50,000,000

 

Issued shares

 

14,375,000

 

25,875,000

 

Outstanding shares

 

14,370,060

 

25,875,000

 

 

 

 

 

 

Common Stock, $1.00 par value:

 

 

 

 

 

Authorized shares

 

700,000,000

 

700,000,000

 

Issued shares

 

372,852,311

 

363,576,924

 

Outstanding shares

 

371,731,551

 

362,602,173

 

 

 

 

 

 

     Preferred Stock.  The following is a summary of our preferred stock activity during the periods presented:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

December 31, 2017

 

December 31, 2016

 

December 31, 2015

 

 

 

 

Weighted Avg.

 

 

 

Weighted Avg.

 

 

 

Weighted Avg.

 

 

Shares

 

Dividend Rate

 

Shares

 

Dividend Rate

 

Shares

 

Dividend Rate

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

 

25,875,000

 

6.500%

 

25,875,000

 

6.500%

 

25,875,000

 

6.500%

Shares redeemed

 

(11,500,000)

 

6.500%

 

-

 

0.000%

 

-

 

0.000%

Shares converted

 

(4,940)

 

6.500%

 

-

 

0.000%

 

-

 

0.000%

Ending balance

 

14,370,060

 

6.500%

 

25,875,000

 

6.500%

 

25,875,000

 

6.500%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     During the three months ended March 31, 2011, we issued 14,375,000 of 6.50% Series I Cumulative Convertible Perpetual Preferred Stock.  These shares have a liquidation value of $50.00 per share.  Dividends are payable quarterly in arrears.  The preferred stock is not redeemable by us.  The preferred shares are convertible, at the holder’s option, into 0.8460 shares of common stock (equal to an initial conversion price of approximately $59.10).  During the year ended December 31, 2017, 4,940 shares of Series I preferred stock were converted into common stock.

 

     During the three months ended March 31, 2012, we issued 11,500,000 of 6.50% Series J Cumulative Redeemable Preferred Stock.  During the year ended December 31, 2017, we recognized a charge of $9,769,000 in connection with the redemption of the Series J preferred stock.

 

     Common Stock. The following is a summary of our common stock activity during the periods indicated (dollars in thousands, except average price amounts):

74


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares Issued

 

 

Average Price

 

 

Gross Proceeds

 

 

Net Proceeds

 

 

 

 

 

 

 

 

 

 

 

 

February 2015 public issuance

 

19,550,000

 

$

 75.50  

 

$

1,476,025

 

$

1,423,935

2015 Dividend reinvestment plan issuances

 

4,024,169

 

 

 67.72  

 

 

272,531

 

 

272,531

2015 Option exercises

 

249,054

 

 

 47.35  

 

 

11,793

 

 

11,793

2015 Equity Shelf Program issuances

 

696,070

 

 

 69.23  

 

 

48,186

 

 

47,463

2015 Stock incentive plans, net of forfeitures

 

137,837

 

 

  

 

 

-

 

 

-

2015 Senior note conversions

 

1,330,474

 

 

 

 

 

-

 

 

-

2015 Totals

 

25,987,604

 

 

 

 

$

1,808,535

 

$

1,755,722

 

 

 

 

 

 

 

 

 

 

 

 

2016 Dividend reinvestment plan issuances

 

4,145,457

 

$

 70.34  

 

$

291,852

 

$

291,571

2016 Option exercises

 

141,405

 

 

 47.13  

 

 

6,664

 

 

6,664

2016 Equity Shelf Program issuances

 

3,134,901

 

 

 75.27  

 

 

238,286

 

 

235,959

2016 Stock incentive plans, net of forfeitures

 

402,740

 

 

  

 

 

-

 

 

-

2016 Totals

 

7,824,503

 

 

 

 

$

536,802

 

$

534,194

 

 

 

 

 

 

 

 

 

 

 

 

2017 Dividend reinvestment plan issuances

 

5,640,008

 

$

 69.97  

 

$

395,526

 

$

394,639

2017 Option exercises

 

252,979

 

 

 51.16  

 

 

12,942

 

 

12,942

2017 Equity Shelf Program issuances

 

2,986,574

 

 

 71.79  

 

 

215,917

 

 

214,406

2017 Preferred stock conversions

 

4,300

 

 

 

 

 

-

 

 

-

2017 Redemption of equity membership units

 

91,180

 

 

 

 

 

-

 

 

-

2017 Stock incentive plans, net of forfeitures

 

154,337

 

 

  

 

 

-

 

 

-

2017 Totals

 

9,129,378

 

 

 

 

$

624,385

 

$

621,987

 

 

  

 

 

 

 

 

 

 

 

 

     Dividends.  The increase in dividends is primarily attributable to increases in our common shares outstanding, offset by the redemption of the Series J preferred stock, as described above.  Please refer to Note 18 for information related to federal income tax of dividends.  The following is a summary of our dividend payments (in thousands, except per share amounts):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

December 31, 2017

 

December 31, 2016

 

December 31, 2015

  

 

Per Share

 

Amount

 

Per Share

 

Amount

 

Per Share

 

Amount

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

$

3.4800

 

$

1,277,321

 

$

3.4400

 

$

1,233,519

 

$

3.3000

 

$

1,144,727

Series I Preferred Stock

 

 

3.2500

 

 

46,711

 

 

3.2500

 

 

46,719

 

 

3.2500

 

 

46,719

Series J Preferred Stock

 

 

0.2347

 

 

2,699

 

 

1.6251

 

 

18,687

 

 

1.6251

 

 

18,687

Totals

 

 

 

 

$

1,326,731

 

 

 

 

$

1,298,925

 

 

 

 

$

1,210,133

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Accumulated Other Comprehensive Income. The following is a summary of accumulated other comprehensive income/(loss) for the periods presented (in thousands):

75


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrecognized gains (losses) related to:

 

 

 

 

 

 

 Foreign Currency Translation

 

 

Equity Investments

 

 

Actuarial losses

 

 

Cash Flow Hedges

 

 

Total

Balance at December 31, 2016

 

$

(173,496)

 

$

5,120

 

$

(1,153)

 

$

(2)

 

$

(169,531)

Other comprehensive income (loss) before reclassification adjustments

 

  

62,915

 

 

-

 

 

269

 

 

2

 

 

63,186

Reclassification adjustment for write down of equity investment

 

 

-

 

 

(5,120)

 

 

-

 

 

-

 

 

(5,120)

Net current-period other comprehensive income (loss)

 

  

62,915

 

 

(5,120)

 

 

269

 

 

2

 

 

58,066

Balance at December 31, 2017

 

$

(110,581)

 

$

-

 

$

(884)

 

$

-

 

$

(111,465)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2015

 

$

(85,484)

 

$

-

 

$

(1,343)

 

$

(1,416)

 

$

(88,243)

Other comprehensive income (loss) before reclassification adjustments

 

  

(90,528)

 

 

5,120

 

 

190

 

 

1,414

 

 

(83,804)

Reclassification amount to net income

 

 

2,516

 

 

-

 

 

-

 

 

-

 

 

2,516

Net current-period other comprehensive income (loss)

 

  

(88,012)

 

 

5,120

 

 

190

 

 

1,414

 

 

(81,288)

Balance at December 31, 2016

 

$

(173,496)

 

$

5,120

 

$

(1,153)

 

$

(2)

 

$

(169,531)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Other Equity.  Other equity consists of accumulated option compensation expense, which represents the amount of amortized compensation costs related to stock options awarded to employees and directors.

 

14. Stock Incentive Plans

     In May 2016, our shareholders approved the 2016 Long-Term Incentive Plan (“2016 Plan”), which authorizes up to 10,000,000 shares of common stock to be issued at the discretion of the Compensation Committee of the Board of Directors. Awards granted after May 5, 2016 are issued out of the 2016 Plan.  The awards granted under the Amended and Restated 2005 Long-Term Incentive Plan continue to vest and options expire ten years from the date of grant.  Our non-employee directors, officers and key employees are eligible to participate in the 2016 Plan. The 2016 Plan allows for the issuance of, among other things, stock options, stock appreciation rights, restricted stock, deferred stock units, and dividend equivalent rights. Vesting periods for options, deferred stock units, and restricted shares generally range from three to five years.

     Under our long-term incentive plan, certain restricted stock awards are market and performance based.  We will grant a target number of restricted stock units, with the ultimate award determined by the total shareholder return and operating performance metrics, measured in each case over a measurement period of two to three years.  Awards vest over two to three years after the end of the performance period with a portion vesting immediately at the end of the performance periods.  The expected term represents the period from the grant date to the end of the performance period.  Compensation expense for these performance grants is measured based on the probability of achievement of certain performance goals and is recognized over both the performance period and vesting period.  For the portion of the grant for which the award is determined by the operating performance metrics, the compensation cost is based on the grant date closing price and management’s estimate of corporate achievement of the financial metrics.  If the estimated number of performance based restricted stock to be earned changes, an adjustment will be recorded to recognize the accumulated difference between the revised and previous estimates.  For the portion of the grant determined by the total shareholder return, management used a Monte Carlo model to assess the fair value and compensation cost. 

     The following table summarizes compensation expense (a component of general and administrative expenses) recognized for the periods presented (in thousands):

  

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

2017

 

2016

 

2015

Stock options

 

$

10

 

$

266

 

$

698

Restricted stock

 

 

19,092

 

 

28,603

 

 

30,146

 

 

$

19,102

 

$

28,869

 

$

30,844

 

 

 

 

 

 

 

 

 

 

Stock Options

     We have not granted stock options since the year ended December 31, 2012 but some remain outstanding.  As of December 31, 2016, there was no unrecognized compensation expense related to unvested stock options.  Stock options outstanding at December 31, 2017 have an aggregate intrinsic value of $1,346,000.

76


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

Restricted Stock

The fair value of the restricted stock is equal to the market price of the Company’s common stock on the date of grant and is amortized over the vesting periods.   As of December 31, 2017, there was $31,709,000 of total unrecognized compensation expense related to unvested restricted stock that is expected to be recognized over a weighted-average period of three years.  The following table summarizes information about non-vested restricted stock incentive awards as of and for the year ended December 31, 2017:

 

 

 

Restricted Stock

 

 

Number of

 

Weighted-Average

 

 

Shares

 

Grant Date

 

  

(000's)

 

Fair Value

Non-vested at December 31, 2016

  

987

 

$

58.98

Vested

  

(477)

 

 

63.15

Granted

  

247

 

 

69.78

Terminated

  

(59)

 

 

63.20

Non-vested at December 31, 2017

  

698

 

$

61.00

 

15. Earnings Per Share

     The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share data):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2017

 

2016

 

2015

Numerator for basic and diluted earnings per share -

 

 

 

 

 

 

 

 

 

 

net income attributable to common stockholders

 

$

463,595

 

$

1,012,397

 

$

818,344

 

 

 

 

 

 

 

 

 

 

 

Denominator for basic earnings per

 

 

 

 

 

 

 

 

 

 

share: weighted-average shares

 

 

367,237

 

 

358,275

 

 

348,240

Effect of dilutive securities:

 

 

 

 

 

 

 

 

 

 

Employee stock options

 

 

47

 

 

110

 

 

143

 

Non-vested restricted shares

 

 

482

 

 

449

 

 

535

 

Redeemable shares

 

 

1,235

 

 

1,393

 

 

310

 

Convertible senior unsecured notes

 

 

-

 

 

-

 

 

196

Dilutive potential common shares

 

 

1,764

 

 

1,952

 

 

1,184

Denominator for diluted earnings per

 

 

 

 

 

 

 

 

 

 

share: adjusted-weighted average shares

 

 

369,001

 

 

360,227

 

 

349,424

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share

 

$

1.26

 

$

2.83

 

$

2.35

Diluted earnings per share

 

$

1.26

 

$

2.81

 

$

2.34

 

 

 

 

 

 

 

 

 

 

 

Stock options outstanding were anti-dilutive for the years ended December 31, 2017, 2016 and 2015.  The Series I Cumulative Convertible Perpetual Preferred Stock were excluded from the calculations as the effect of the conversions also were anti-dilutive.

77


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

16. Disclosure about Fair Value of Financial Instruments

 

     U.S. GAAP provides authoritative guidance for measuring and disclosing fair value measurements of assets and liabilities.  The guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  The guidance also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The guidance describes three levels of inputs that may be used to measure fair value:

·         Level 1 - Quoted prices in active markets for identical assets or liabilities.

·         Level 2 - Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. 

·         Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

     The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value.

 

Mortgage Loans and Other Real Estate Loans Receivable — The carrying value of mortgage loans and other real estate loans receivable is net of related reserves.  The fair value is generally estimated by using Level 2 and Level 3 inputs such as discounting the estimated future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. 

 

Cash and Cash Equivalents and Restricted Cash — The carrying amount approximates fair value.

 

Available-for-sale Equity Investments — Available-for-sale equity investments are recorded at their fair value based on Level 1 publicly available trading prices.

 

Borrowings Under Primary Unsecured Credit Facility — The carrying amount of the primary unsecured credit facility approximates fair value because the borrowings are interest rate adjustable.

 

Senior Unsecured Notes — The fair value of the senior unsecured notes payable was estimated based on Level 1 publicly available trading prices.  The carrying amount of the variable rate senior unsecured notes approximates fair value because they are interest rate adjustable.

 

Secured Debt — The fair value of fixed rate secured debt is estimated using Level 2 inputs by discounting the estimated future cash flows using the current rates at which similar loans would be made with similar credit ratings and for the same remaining maturities.  The carrying amount of variable rate secured debt approximates fair value because the borrowings are interest rate adjustable.

 

Foreign Currency Forward Contracts — Foreign currency forward contracts are recorded in other assets or other liabilities on the balance sheet at fair market value.  Fair market value is determined using Level 2 inputs by estimating the future value of the currency pair based on existing exchange rates, comprised of current spot and traded forward points, and calculating a present value of the net amount using a discount factor based on observable traded interest rates.

 

Redeemable OP Unitholder Interests — Our redeemable OP unitholder interests are recorded on the balance sheet at fair value using Level 2 inputs.  The fair value is measured using the closing price of our common stock, as units may be redeemed at the election of the holder for cash or, at our option, one share of our common stock per unit, subject to adjustment in certain circumstances.

 

     The carrying amounts and estimated fair values of our financial instruments are as follows as of the dates presented (in thousands):

78


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2017

 

December 31, 2016

 

 

 

Carrying

 

Fair

 

Carrying

 

Fair

 

 

 

Amount

 

Value

 

Amount

 

Value

Financial Assets:

 

  

 

 

 

 

 

 

 

 

 

 

 

Mortgage loans receivable

 

$

306,120

 

$

332,508

 

$

485,735

 

$

521,773

 

Other real estate loans receivable

 

  

121,379

 

 

125,480

 

 

136,893

 

 

138,050

 

Available-for-sale equity investments

 

  

7,269

 

 

7,269

 

 

27,899

 

 

27,899

 

Cash and cash equivalents

 

  

243,777

 

 

243,777

 

 

419,378

 

 

419,378

 

Restricted cash

 

 

65,526

 

 

65,526

 

 

187,842

 

 

187,842

 

Foreign currency forward contracts

 

 

15,604

 

 

15,604

 

 

135,561

 

 

135,561

 

 

 

  

 

 

 

 

 

 

 

 

 

 

Financial Liabilities:

 

  

 

 

 

 

 

 

 

 

 

 

 

Borrowings under unsecured lines of credit arrangements

 

$

719,000

 

$

719,000

 

$

645,000

 

$

645,000

 

Senior unsecured notes

 

  

8,331,722

 

 

9,168,432

 

 

8,161,619

 

 

8,879,176

 

Secured debt

 

  

2,608,976

 

 

2,641,997

 

 

3,477,699

 

 

3,558,378

 

Foreign currency forward contracts

 

 

38,654

 

 

38,654

 

 

4,342

 

 

4,342

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Redeemable OP unitholder interests

 

$

97,476

 

$

97,476

 

$

110,502

 

$

110,502

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Items Measured at Fair Value on a Recurring Basis

 

     The market approach is utilized to measure fair value for our financial assets and liabilities reported at fair value on a recurring basis.  The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.  The following summarizes items measured at fair value on a recurring basis (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements as of December 31, 2017

 

 

Total

 

Level 1

 

Level 2

 

Level 3

Available-for-sale equity investments(1)

 

$

7,269

 

$

7,269

 

$

-

 

$

-

Foreign currency forward contracts, net(2)

 

 

(23,050)

 

 

-

 

 

(23,050)

 

 

-

Redeemable OP unitholder interests

 

 

97,476

 

 

-

 

 

97,476

 

 

-

 Totals 

 

$

81,695

 

$

7,269

 

$

74,426

 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Unrealized gains or losses on available-for-sale equity investments are recorded in accumulated other comprehensive income (loss) at each measurement date. During the years ended December 31, 2017 and 2015, we recognized other than temporary impairment charges of $18,294,000 and $35,648,000, respectively, on the Genesis HealthCare stock investment.  Also, see Note 11 for details related to the gain on the derivative asset originally recognized.

(2) Please see Note 11 for additional information.

 

 

 

 

 

 

 

 

 

 

 

 

 

Items Measured at Fair Value on a Nonrecurring Basis

 

     In addition to items that are measured at fair value on a recurring basis, we also have assets and liabilities in our balance sheet that are measured at fair value on a nonrecurring basis.  Assets, liabilities and noncontrolling interests that are measured at fair value on a nonrecurring basis include those acquired/assumed in asset acquisitions and business combinations (see Note 3), and asset impairments (see Note 5 for impairments of real property and Note 6 for impairments of loans receivable). We have determined that the fair value measurements included in each of these assets and liabilities rely primarily on company-specific inputs and our assumptions about the use of the assets and settlement of liabilities as observable inputs are not available. As such, we have determined that each of these fair value measurements generally reside within Level 3 of the fair value hierarchy. We estimate the fair value of real estate and related intangibles using the income approach and unobservable data such as net operating income and estimated capitalization and discount rates.  We also consider local and national industry market data including comparable sales, and commonly engage an external real estate appraiser to assist us in our estimation of fair value.  We estimate the fair value of assets held for sale based on current sales price expectations or, in the absence of such price expectations, Level 3 inputs described above.  We estimate the fair value of loans receivable using projected payoff valuations based on the expected future cash flows and/or the estimated fair value of the underlying collateral.  We may base our valuation on a loan’s observable market price, if any, or the fair value of collateral, net of sales costs, if the repayment of the loan is expected to be provided solely by the collateral.  We estimate the fair value of secured debt assumed in business combinations and asset acquisitions using current interest rates at which similar borrowings could be obtained on the transaction date.

79


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

17. Segment Reporting

     We invest in seniors housing and health care real estate. We evaluate our business and make resource allocations on our three operating segments: triple-net, seniors housing operating and outpatient medical. Our triple-net properties include long-term/post-acute care facilities, assisted living facilities, independent living/continuing care retirement communities, independent support living facilities (Canada), care homes with and without nursing (U.K.), and combinations thereof.  Under the triple-net segment, we invest in seniors housing and health care real estate through acquisition and financing of primarily single tenant properties.  Properties acquired are primarily leased under triple-net leases and we are not involved in the management of the property.  Our seniors housing operating properties include the seniors housing communities referenced above that are owned and/or operated through RIDEA structures (see Note 18). Our outpatient medical properties include outpatient medical buildings which are typically leased to multiple tenants and generally require a certain level of property management by us.

     We evaluate performance based upon consolidated net operating income (“NOI”) of each segment.  We define NOI as total revenues, including tenant reimbursements, less property operating expenses.  We believe NOI provides investors relevant and useful information because it measures the operating performance of our properties at the property level on an unleveraged basis.  We use NOI to make decisions about resource allocations and to assess the property level performance of our properties.

      Non-segment revenue consists mainly of interest income on certain non-real estate investments and other income. Non-segment assets consist of corporate assets including cash, deferred loan expenses and corporate offices and equipment among others. Non-property specific revenues and expenses are not allocated to individual segments in determining NOI.

     The accounting policies of the segments are the same as those described in the summary of significant accounting policies (see Note 2). The results of operations for all acquisitions described in Note 3 are included in our consolidated results of operations from the acquisition dates and are components of the appropriate segments.  There are no intersegment sales or transfers.

     Summary information for the reportable segments (which excludes unconsolidated entities) during the years ended December 31, 2017, 2016 and 2015 is as follows (in thousands):

 

Year Ended December 31, 2017:

 

Triple-net

 

Seniors Housing Operating

 

Outpatient Medical

 

Non-segment / Corporate

 

Total

Rental income

$

885,811

$

-

$

560,060

$

-

$

1,445,871

Resident fees and services

 

-

 

2,779,423

 

-

 

-

 

2,779,423

Interest income

 

73,742

 

69

 

-

 

-

 

73,811

Other income

 

7,531

 

5,127

 

3,340

 

1,538

 

17,536

Total revenues

 

967,084

 

2,784,619

 

563,400

 

1,538

 

4,316,641

 

 

 

 

 

 

 

 

 

 

 

Property operating expenses

 

-

 

1,904,593

 

179,332

 

-

 

2,083,925

Consolidated net operating income

 

967,084

 

880,026

 

384,068

 

1,538

 

2,232,716

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

15,194

 

63,265

 

10,015

 

396,148

 

484,622

Loss (gain) on derivatives, net

 

2,284

 

-

 

-

 

-

 

2,284

Depreciation and amortization

 

243,830

 

484,796

 

193,094

 

-

 

921,720

General and administrative

 

-

 

-

 

-

 

122,008

 

122,008

Loss (gain) on extinguishment of debt, net

 

29,083

 

3,785

 

4,373

 

-

 

37,241

Provision for loan losses

 

62,966

 

-

 

-

 

-

 

62,966

Impairment of assets

 

96,909

 

21,949

 

5,625

 

-

 

124,483

Other expenses

 

 116,689 (1)

 

8,347

 

1,911

 

 50,829 (2)

 

177,776

Income (loss) from continuing operations before income taxes and income (loss) from unconsolidated entities

 

400,129

 

297,884

 

169,050

 

(567,447)

 

299,616

Income tax benefit (expense)

 

(4,291)

 

(16,430)

 

(1,477)

 

2,070

 

(20,128)

(Loss) income from unconsolidated entities

 

19,428

 

(105,236)

 

2,683

 

-

 

(83,125)

Income (loss) from continuing operations

 

415,266

 

176,218

 

170,256

 

(565,377)

 

196,363

Gain (loss) on real estate dispositions, net

 

286,325

 

56,295

 

1,630

 

-

 

344,250

Net income (loss)

$

701,591

$

232,513

$

171,886

$

(565,377)

$

540,613

 

 

 

 

 

 

 

 

 

 

 

Total assets

$

9,325,344

$

13,432,001

$

5,082,145

$

104,955

$

27,944,445

 

 

 

 

 

 

 

 

 

 

 

(1) Primarily represents non-capitalizable transaction costs, including $88,316,000 due to a joint venture transaction with an existing seniors housing operator which converted a portfolio of properties from triple-net to seniors housing operating, an exchange of PropCo/OpCo interests, and termination/restructuring of pre-existing relationships. In addition, includes $18,294,000 other than temporary impairment charge on the Genesis available-for-sale equity investment (see also Notes 11 and 16).

(2) Primarily related to $40,730,000 recognized for the donation of the corporate headquarters. See also Note 12.

80


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

Year Ended December 31, 2016:

 

Triple-net

 

Seniors Housing Operating

 

Outpatient Medical

 

Non-segment / Corporate

 

Total

Rental income

$

1,112,325

$

-

$

536,490

$

-

$

1,648,815

Resident fees and services

 

-

 

2,504,731

 

-

 

-

 

2,504,731

Interest income

 

90,476

 

4,180

 

3,307

 

-

 

97,963

Other income

 

6,059

 

17,085

 

5,568

 

939

 

29,651

Total revenues

 

1,208,860

 

2,525,996

 

545,365

 

939

 

4,281,160

 

 

 

 

 

 

 

 

 

 

 

Property operating expenses

 

-

 

1,711,882

 

165,101

 

-

 

1,876,983

Consolidated net operating income

 

1,208,860

 

814,114

 

380,264

 

939

 

2,404,177

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

21,370

 

81,853

 

19,087

 

399,035

 

521,345

Loss (gain) on derivatives, net

 

68

 

-

 

-

 

(2,516)

 

(2,448)

Depreciation and amortization

 

297,197

 

415,429

 

188,616

 

-

 

901,242

General and administrative

 

-

 

-

 

-

 

155,241

 

155,241

Transaction costs

 

10,016

 

29,207

 

3,687

 

-

 

42,910

Loss (gain) on extinguishment of debt, net

 

863

 

(88)

 

-

 

16,439

 

17,214

Provision for loan losses

 

6,935

 

-

 

3,280

 

-

 

10,215

Impairment of assets

 

20,169

 

12,403

 

4,635

 

-

 

37,207

Other expenses

 

-

 

-

 

-

 

11,998

 

11,998

Income (loss) from continuing operations before income taxes and income (loss) from unconsolidated entities

 

852,242

 

275,310

 

160,959

 

(579,258)

 

709,253

Income tax benefit (expense)

 

(1,087)

 

(3,762)

 

(511)

 

24,488

 

19,128

(Loss) income from unconsolidated entities

 

9,767

 

(20,442)

 

318

 

-

 

(10,357)

Income (loss) from continuing operations

 

860,922

 

251,106

 

160,766

 

(554,770)

 

718,024

Gain (loss) on real estate dispositions, net

 

355,394

 

9,880

 

(1,228)

 

-

 

364,046

Net income (loss)

$

1,216,316

$

260,986

$

159,538

$

(554,770)

$

1,082,070

 

 

 

 

 

 

 

 

 

 

 

Total assets

$

10,713,032

$

12,851,414

$

4,951,538

$

349,200

$

28,865,184

 

Year Ended December 31, 2015:

 

Triple-net

 

Seniors Housing Operating

 

Outpatient Medical

 

Non-segment / Corporate

 

Total

Rental income

$

1,094,827

$

-

$

504,121

$

-

$

1,598,948

Resident fees and services

 

-

 

2,158,031

 

-

 

-

 

2,158,031

Interest income

 

74,108

 

4,180

 

5,853

 

-

 

84,141

Other income

 

6,871

 

6,060

 

4,684

 

1,091

 

18,706

Total revenues

 

1,175,806

 

2,168,271

 

514,658

 

1,091

 

3,859,826

 

 

 

 

 

 

 

 

 

 

 

Property operating expenses

 

-

 

1,467,009

 

155,248

 

-

 

1,622,257

Consolidated net operating income

 

1,175,806

 

701,262

 

359,410

 

1,091

 

2,237,569

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

28,384

 

70,388

 

27,542

 

365,855

 

492,169

Loss (gain) on derivatives, net

 

(58,427)

 

-

 

-

 

-

 

(58,427)

Depreciation and amortization

 

288,242

 

351,733

 

186,265

 

-

 

826,240

General and administrative

 

-

 

-

 

-

 

147,416

 

147,416

Transaction costs

 

53,195

 

54,966

 

2,765

 

-

 

110,926

Loss (gain) on extinguishment of debt, net

 

10,095

 

(195)

 

-

 

24,777

 

34,677

Impairment of assets

 

2,220

 

-

 

-

 

-

 

2,220

Other expenses

 

35,648

 

-

 

-

 

10,583

 

46,231

Income (loss) from continuing operations before income taxes and income (loss) from unconsolidated entities

 

816,449

 

224,370

 

142,838

 

(547,540)

 

636,117

Income tax benefit (expense)

 

(4,244)

 

986

 

245

 

(3,438)

 

(6,451)

(Loss) income from unconsolidated entities

 

8,260

 

(32,672)

 

2,908

 

-

 

(21,504)

Income from continuing operations

 

820,465

 

192,684

 

145,991

 

(550,978)

 

608,162

Gain (loss) on real estate dispositions, net

 

86,261

 

-

 

194,126

 

-

 

280,387

Net income (loss)

$

906,726

$

192,684

$

340,117

$

(550,978)

$

888,549

     Our portfolio of properties and other investments are located in the U.S., the U.K. and Canada. Revenues and assets are attributed to the country in which the property is physically located. The following is a summary of geographic information for the periods presented (dollars in thousands):

81


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

December 31, 2017

 

 

December 31, 2016

 

 

December 31, 2015

Revenues:

 

Amount

%

 

 

Amount

%

 

 

Amount

%

United States

$

3,464,527

80.3%

 

$

3,453,485

80.6%

 

$

3,133,327

81.1%

United Kingdom

 

407,351

9.4%

 

 

388,383

9.1%

 

 

407,745

10.6%

Canada

 

444,763

10.3%

 

 

439,292

10.3%

 

 

318,754

8.3%

Total

$

4,316,641

100.0%

 

$

4,281,160

100.0%

 

$

3,859,826

100.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of

 

 

 

 

 

 

December 31, 2017

 

 

December 31, 2016

 

 

 

 

Assets:

 

Amount

%

 

 

Amount

%

 

 

 

 

United States

$

22,274,443

79.7%

 

$

23,572,459

81.7%

 

 

 

 

United Kingdom

 

3,239,039

11.6%

 

 

2,782,489

9.6%

 

 

 

 

Canada

 

2,430,963

8.7%

 

 

2,510,236

8.7%

 

 

 

 

Total

$

27,944,445

100.0%

 

$

28,865,184

100.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18. Income Taxes and Distributions

 

We elected to be taxed as a REIT commencing with our first taxable year.  To qualify as a REIT for federal income tax purposes, at least 90% of taxable income (excluding 100% of net capital gains) must be distributed to stockholders.  REITs that do not distribute a certain amount of current year taxable income are also subject to a 4% federal excise tax. The main differences between net income for federal income tax purposes and consolidated financial statement purposes are the recognition of straight-line rent for reporting purposes, basis differences in acquisitions, recording of impairments, differing useful lives and depreciation and amortization methods for real property and the provision for loan losses for reporting purposes versus bad debt expense for tax purposes.

 

Cash distributions paid to common stockholders, for federal income tax purposes, are as follows for the periods presented:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

2017

 

 

2016

 

 

2015

Per Share:

 

  

 

 

 

 

 

 

 

 

Ordinary income

 

$

1.8117

 

$

2.5067

 

$

1.9134

 

Qualified dividend*

 

 

0.0038

 

 

0.0047

 

 

0.0529

 

Return of capital

 

  

0.0929

 

  

0.0573

 

  

0.0503

 

Long-term capital gains

 

 

1.5750

 

 

0.4593

 

 

0.9352

 

Unrecaptured section 1250 gains*

 

  

0.3557

 

  

0.4120

 

  

0.3482

 

Totals

 

$

3.4800

 

$

3.4400

 

$

3.3000

 

 

 

 

 

 

 

 

 

 

 

 

*Informational purposes only

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Our consolidated provision for income tax expense (benefit) is as follows for the periods presented (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

Current

 

$

7,633

 

$

14,944

 

$

10,177

Deferred

 

  

12,495

 

  

(34,072)

 

  

(3,726)

Totals

 

$

20,128

 

$

(19,128)

 

$

6,451

 

 

 

 

 

 

 

 

 

 

      REITs generally are not subject to U.S. federal income taxes on that portion of REIT taxable income or capital gain that is distributed to stockholders.  For the tax year ended December 31, 2017, as a result of acquisitions located in Canada and the U.K., we were subject to foreign income taxes under the respective tax laws of these jurisdictions. 

 

     The provision for income taxes for the year ended December 31, 2017 primarily relates to state taxes, foreign taxes, and taxes based on income generated by entities that are structured as TRSs.  For the tax years ended December 31, 2017, 2016 and 2015, the foreign tax provision/(benefit) amount included in the consolidated provision for income taxes was $4,806,000, ($3,315,000) and $7,385,000, respectively.

 

82


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

     A reconciliation of income taxes, which is computed by applying the federal corporate tax rate for the years ended December 31, 2017, 2016 and 2015, to the income tax expense/(benefit) is as follows for the periods presented (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

Tax at statutory rate on earnings from continuing operations before unconsolidated entities, noncontrolling interests and income taxes

 

$

199,588

 

$

372,030

 

$

313,250

Increase (decrease) in valuation allowance(1)

 

 

30,445

 

 

(2,128)

 

 

13,759

Tax at statutory rate on earnings not subject to federal income taxes

 

 

(234,468)

 

 

(399,571)

 

 

(319,832)

Foreign permanent depreciation

 

 

10,065

 

 

9,205

 

 

7,500

Other differences

 

 

14,498

 

 

1,336

 

 

(8,226)

Totals

 

$

20,128

 

$

(19,128)

 

$

6,451

 

 

 

 

 

 

 

 

 

 

(1) Excluding purchase price accounting.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     Each TRS and foreign entity subject to income taxes is a tax paying component for purposes of classifying deferred tax assets and liabilities. The tax effects of taxable and deductible temporary differences, as well as tax asset/(liability) attributes, are summarized as follows for the periods presented (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

Investments and property, primarily differences in investment basis, depreciation and amortization, the basis of land assets and the treatment of interests and certain costs

 

$

(11,812)

 

$

(7,089)

 

$

(30,564)

Operating loss and interest deduction carryforwards

 

  

94,654

 

  

82,469

 

  

75,455

Expense accruals and other

 

 

25,146

 

 

15,978

 

 

6,259

Valuation allowance

 

 

(127,283)

 

 

(96,838)

 

 

(98,966)

Net deferred tax assets (liabilities)

 

$

(19,295)

 

$

(5,480)

 

$

(47,816)

 

 

 

 

 

 

 

 

 

 

    We assess the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets.  We apply the concepts on an entity-by-entity, jurisdiction-by-jurisdiction basis.  With respect to the analysis of certain entities in multiple jurisdictions, a significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three-year period ended December 31, 2017.  Such objective evidence limits the ability to consider other subjective evidence such as our projections for future growth. 

 

     On the basis of the evaluations performed as required by the codification, valuation allowances totaling $127,283,000 were recorded on U.S. taxable REIT subsidiaries as well as entities in other jurisdictions to limit the deferred tax assets to the amount that we believe is more likely that not realizable.  However, the amount of the deferred tax asset considered realizable could be adjusted if (i) estimates of future taxable income during the carryforward period are reduced or increased or (ii) objective negative evidence in the form of cumulative losses is no longer present (and additional weight may be given to subjective evidence such as our projections for growth).  The valuation allowance rollforward is summarized as follows for the periods presented (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

2017

 

 

2016

 

 

2015

Beginning balance

 

$

96,838

 

$

98,966

 

$

85,207

   Expense (benefit)

 

 

30,445

 

 

(2,128)

 

 

13,759

Ending balance

 

$

127,283

 

$

96,838

 

$

98,966

 

 

 

 

 

 

 

 

 

 

       As a result of certain acquisitions, we are subject to corporate level taxes for any related asset dispositions that may occur during the five-year period immediately after such assets were owned by a C corporation (“built-in gains tax”). The amount of income potentially subject to this special corporate level tax is generally equal to the lesser of (a) the excess of the fair value of the asset over its adjusted tax basis as of the date it became a REIT asset, or (b) the actual amount of gain. Some but not all gains recognized during this period of time could be offset by available net operating losses and capital loss carryforwards.  During the year ended December 31, 2016, we acquired certain additional assets with built-in gains as of the date of acquisition that could be subject to the built-in gains tax if disposed of prior to the expiration of the applicable ten-year period.  We have not recorded a deferred tax liability as a result of the potential built-in gains tax based on our intentions with respect to such properties and available tax planning strategies.

 

      Under the provisions of the REIT Investment Diversification and Empowerment Act of 2007 (“RIDEA”), for taxable years beginning after July 30, 2008, the REIT may lease “qualified health care properties” on an arm’s-length basis to a TRS if the property

83


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

is operated on behalf of such subsidiary by a person who qualifies as an “eligible independent contractor.” Generally, the rent received from the TRS will meet the related party rent exception and will be treated as “rents from real property.” A “qualified health care property” includes real property and any personal property that is, or is necessary or incidental to the use of, a hospital, nursing facility, assisted living facility, congregate care facility, qualified continuing care facility, or other licensed facility which extends medical or nursing or ancillary services to patients.  We have entered into various joint ventures that were structured under RIDEA.  Resident level rents and related operating expenses for these facilities are reported in the consolidated financial statements and are subject to federal, state and foreign income taxes as the operations of such facilities are included in a TRS.  Certain net operating loss carryforwards could be utilized to offset taxable income in future years.

 

     Given the applicable statute of limitations, we generally are subject to audit by the Internal Revenue Service (“IRS”) for the year ended December 31, 2014 and subsequent years. The statute of limitations may vary in the states in which we own properties or conduct business.  We do not expect to be subject to audit by state taxing authorities for any year prior to the year ended December 31, 2011. We are also subject to audit by the Canada Revenue Agency and provincial authorities generally for periods subsequent to May 2012 related to entities acquired or formed in connection with acquisitions, and by the U.K.’s HM Revenue & Customs for periods subsequent to August 2012 related to entities acquired or formed in connection with acquisitions.  

 

      At December 31, 2017, we had a net operating loss (“NOL”) carryforward related to the REIT of $448,475,000. Due to our uncertainty regarding the realization of certain deferred tax assets, we have not recorded a deferred tax asset related to NOLs generated by the REIT.  These amounts can be used to offset future taxable income (and/or taxable income for prior years if an audit determines that tax is owed), if any. The REIT will be entitled to utilize NOLs and tax credit carryforwards only to the extent that REIT taxable income exceeds our deduction for dividends paid.  The NOL carryforwards generated through December 31, 2017 will expire through 2036.  Beginning with tax years after December 31, 2017, the Tax Cuts and Jobs Act (“Tax Act”) eliminates the carryback period, limits the NOLs to 80% of taxable income and replaces the 20-year carryforward period with an indefinite carryforward period.

 

     At December 31, 2017 and 2016, we had an NOL carryforward related to Canadian entities of $134,552,000, and $104,988,000, respectively.  These Canadian losses have a 20-year carryforward period.  At December 31, 2017 and 2016, we had an NOL carryforward related to U.K. entities of $183,712,000 and $158,156,000, respectively.  These U.K. losses do not have a finite carryforward period.

 

We did not identify items for which the income tax effects of the Tax Act have not been completed and a reasonable estimate could not be determined as of December 31, 2017.  Our analysis of the Tax Act may be impacted by any corrective legislation and any guidance provided by the U.S. Treasury, the IRS or by the General Explanation of the Tax Act, which is under preparation by the Staff of the Congressional Joint Committee on Taxation.  Based on the Tax Act as enacted, we do not believe there will be further material impacts to the consolidated financial statements related to the other Tax Act provisions but cannot assure you as to the outcome of this matter.

  

84


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

19. Quarterly Results of Operations (Unaudited)

 

The following is a summary of our unaudited quarterly results of operations for the years ended December 31, 2017 and 2016 (in thousands, except per share data). The sum of individual quarterly amounts may not agree to the annual amounts included in the consolidated statements of comprehensive income due to rounding.

 

 

 

Year Ended December 31, 2017

 

 

 

1st Quarter

 

2nd Quarter

 

3rd Quarter

 

4th Quarter(1)

Revenues

 

$

1,062,298

 

$

1,058,602

 

$

1,091,483

 

$

1,104,257

Net income (loss) attributable to common stockholders

 

 

312,639

 

 

188,429

 

 

74,043

 

 

(111,523)

Net income (loss) attributable to common stockholders per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.86

 

$

0.51

 

$

0.20

 

$

(0.31)

 

Diluted

 

$

0.86

 

$

0.51

 

$

0.20

 

$

(0.31)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31, 2016

 

 

 

1st Quarter

 

2nd Quarter

 

3rd Quarter(2)

 

4th Quarter

Revenues

 

$

1,047,050

 

$

1,076,657

 

$

1,079,133

 

$

1,078,321

Net income attributable to common stockholders

 

 

148,969

 

 

195,474

 

 

334,910

 

 

333,044

Net income attributable to common stockholders per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.42

 

$

0.55

 

$

0.93

 

$

0.92

 

Diluted

 

$

0.42

 

$

0.54

 

$

0.93

 

$

0.91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) The decrease in net income (loss) and amounts per share are primarily attributable to $99,821,100 impairment of assets and $62,966,000 provision for loan losses recognized in the fourth quarter as compared to none in the third quarter.

(2) The increase in net income and amounts per share are primarily attributable to gains on sales of real estate of $162,351,000 for the third quarter as compared to gains of $1,530,000 for the second quarter.

 

20. Variable Interest Entities

 

     We have entered into joint ventures to own certain seniors housing and outpatient medical assets which are deemed to be variable interest entities (“VIEs”).   We have concluded that we are the primary beneficiary of these VIEs based on a combination of operational control of the joint venture and the rights to receive residual returns or the obligation to absorb losses arising from the joint ventures.  Except for capital contributions associated with the initial joint venture formations, the joint ventures have been and are expected to be funded from the ongoing operations of the underlying properties.  Accordingly, such joint ventures have been consolidated, and the table below summarizes the balance sheets of consolidated VIEs in the aggregate (in thousands):

 

 

 

December 31, 2017

 

 

December 31, 2016

Assets

 

 

 

 

 

 

 

 

Net real property owned

 

$

1,002,137 

 

 

$

989,596 

 

Cash and cash equivalents

 

 

12,308 

 

 

 

10,501 

 

Receivables and other assets

 

 

16,330 

 

 

 

12,102 

 

Total assets(1)

 

$

1,030,775 

 

 

$

1,012,199 

 

 

 

 

 

 

 

 

 

Liabilities and equity

 

 

 

 

 

 

 

 

Secured debt

 

$

471,103 

 

 

$

450,255 

 

Accrued expenses and other liabilities

 

 

14,832 

 

 

 

13,803 

 

Redeemable noncontrolling interests

 

 

171,898 

 

 

 

185,556 

 

Total equity

 

 

372,942 

 

 

 

362,585 

 

Total liabilities and equity

 

$

1,030,775 

 

 

$

1,012,199 

 

 

 

 

 

 

 

 

 

(1) Note that assets of the consolidated VIEs can only be used to settle obligations relating to such VIEs. Liabilities of the consolidated VIEs represent claims against the specific assets of the VIEs.

 

21. Subsequent Events

 

Genesis Restructuring. Subsequent to December 31, 2017, we entered into agreements with Genesis, our largest triple-net relationship, which included the following terms:

 

·         Master Lease: Effective January 1, 2018, the Genesis annual cash rent obligation under the Welltower master lease was reduced by $35 million and the term was extended by 5 years. Additionally, lease escalators will be set to 2.5% in year one and 2% thereafter, and rent will be reset on January 31, 2023 in such fashion to permit the rent payable to Welltower to increase up to $35 million subject to increases in Genesis’s EBITDAR relative to the trailing twelve months ended December 31, 2017, generated by the properties comprising the Welltower master lease portfolio.

 

·         Term Loan: Welltower and Omega Healthcare Investors, Inc. (“Omega”) have entered into an agreement with Genesis to amend and expand the existing Genesis $120 million term loan agreement. Welltower will fund a $24 million tranche and will receive priority of repayment among lenders.

 


WELLTOWER INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

·         Real Estate Loans: As of December 31, 2017, Welltower had approximately $267 million (excluding allowances and non-accrual interest) of real estate loans. Welltower and Genesis have entered into a definitive agreement to amend the annual interest rate beginning February 15, 2018 to 12%, of which 7% will be paid in cash and 5% will be paid-in-kind.

 

·         Interest: Genesis continues to seek refinancing and asset sale transactions to secure commitments to repay no less than $105 million of obligations. If Genesis is unsuccessful in securing such commitments or otherwise reducing the outstanding obligation on or before April 1, 2018, the cash pay component of loan interest will increase by approximately $2 million annually.

  


  

Item 9.  Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 

Not applicable.

 

Item 9A.  Controls and Procedures

 

Disclosure Controls and Procedures

 

An evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report.

 

Management’s Report on Internal Control over Financial Reporting

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) of the Securities Exchange Act of 1934, as amended). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Management has assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2017 based on the criteria established by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) in a report entitled Internal Control — Integrated Framework. 

 

Based on this assessment, using the criteria above, management concluded that the Company’s system of internal control over financial reporting was effective as of December 31, 2017.

 

The independent registered public accounting firm of Ernst & Young LLP, as auditors of the Company’s consolidated financial statements, has issued an attestation report on the Company’s internal control over financial reporting.

 

Changes in Internal Control over Financial Reporting

 

No change in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Securities Exchange Act of 1934, as amended) occurred during the fourth quarter of the one-year period covered by this report that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

87


  

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

The Board of Directors and Shareholders of Welltower Inc.

 

Opinion on Internal Control over Financial reporting

 

     We have audited Welltower Inc. and subsidiaries’ internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the “COSO Criteria”). In our opinion, Welltower Inc. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on the COSO Criteria.

 

     We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Welltower Inc. and subsidiaries as of December 31, 2017 and 2016, the related consolidated statements of comprehensive income, equity and cash flows for each of the three years in the period ended December 31, 2017, and the related notes and financial statement schedules listed in the index at Item 15(a) of the Company and our report dated February 28, 2018 expressed an unqualified opinion thereon.

 

Basis for Opinion

 

     The Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

     We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

 

     Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

 

Definition and Limitations of Internal Control over Financial Reporting

 

     A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

 

     Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

       /s/  Ernst & Young LLP

 

Toledo, Ohio

February 28, 2018

 

Item 9B. Other Information

     None.

88


  

PART III

 

Item 10.  Directors, Executive Officers and Corporate Governance

 

The information required by this Item is incorporated herein by reference to the information under the headings “Election of Directors,” “Corporate Governance,” “Executive Officers,” and “Security Ownership of Directors and Management and Certain Beneficial Owners — Section 16(a) Beneficial Ownership Reporting Compliance” in our definitive proxy statement, which will be filed with the Securities and Exchange Commission (the “Commission”) prior to May 1, 2018.

 

We have adopted a Code of Business Conduct and Ethics that applies to our directors, officers and employees. The code is posted on the Internet at www.welltower.com/investors/governance. Any amendment to, or waivers from, the code that relate to any officer or director of the Company will be promptly disclosed on the Internet at www.welltower.com.

 

In addition, the Board has adopted charters for the Audit, Compensation and Nominating/Corporate Governance Committees. These charters are posted on the Internet at www.welltower.com/investors/governance.  Please refer to “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations – Executive Summary – Corporate Governance” in the Annual Report on Form 10-K for further discussion of corporate governance.

 

The information on our website is not incorporated by reference in this Annual Report on Form 10-K, and our web address is included as an inactive textual reference only.

 

Item 11.  Executive Compensation

 

The information required by this Item is incorporated herein by reference to the information under the headings “Executive Compensation” and “Director Compensation” in our definitive proxy statement, which will be filed with the Commission prior to May 1, 2018.

 

Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 

The information required by this Item is incorporated herein by reference to the information under the headings “Security Ownership of Directors and Management and Certain Beneficial Owners” and “Equity Compensation Plan Information” in our definitive proxy statement, which will be filed with the Commission prior to May 1, 2018.

 

Item 13.  Certain Relationships and Related Transactions and Director Independence 

 

The information required by this Item is incorporated herein by reference to the information under the headings “Corporate Governance — Independence and Meetings” and “Security Ownership of Directors and Management and Certain Beneficial Owners — Certain Relationships and Related Transactions” in our definitive proxy statement, which will be filed with the Commission prior to May 1, 2018.

 

Item 14.  Principal Accounting Fees and Services

 

The information required by this Item is incorporated herein by reference to the information under the heading “Ratification of the Appointment of the Independent Registered Public Accounting Firm” in our definitive proxy statement, which will be filed with the Commission prior to May 1, 2018.

89


  

PART IV

 

Item 15. Exhibits and Financial Statement Schedules

 

(a) 1.           Our Consolidated Financial Statements are included in Part II, Item 8: 

 

Report of Independent Registered Public Accounting Firm

52

Consolidated Balance Sheets – December 31, 2017 and 2016

53

Consolidated Statements of  Comprehensive Income — Years ended  December 31, 2017, 2016 and  2015

54

Consolidated Statements of  Equity — Years ended  December 31, 2017, 2016 and  2015

56

Consolidated Statements of  Cash Flows — Years ended  December 31, 2017, 2016 and  2015

57

Notes to Consolidated Financial Statements

58

 

     2.            The following Financial Statement Schedules are included beginning on page 97:

 

                    III – Real Estate and Accumulated Depreciation

                    IV – Mortgage Loans on Real Estate

 

The financial statement schedule required by Item15(a) (Schedule II, Valuation and Qualifying Accounts) is included in Item 8 of this Annual Report on Form 10-K.

 

 

(b)           Exhibits: 

 

The exhibits listed below are either filed with this Form 10-K or incorporated by reference in accordance with Rule 12b-32 of the Securities Exchange Act of 1934.

  

90


  

3.1(a)     Second Restated Certificate of Incorporation of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 10-K filed March 20, 2000 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(b)     Certificate of Amendment of Second Restated Certificate of Incorporation of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 10-K filed March 20, 2000 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(c)      Certificate of Amendment of Second Restated Certificate of Incorporation of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 8-K filed June 13, 2003 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(d)     Certificate of Amendment of Second Restated Certificate of Incorporation of the Company (filed with the Commission as Exhibit 3.9 to the Company’s Form 10-Q filed August 9, 2007 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(e)      Certificate of Change of Location of Registered Office and of Registered Agent of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 10-Q filed August 6, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(f)      Certificate of Designation of 6.50% Series I Cumulative Convertible Perpetual Preferred Stock of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 8-K filed March 7, 2011 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(g)      Certificate of Amendment of Second Restated Certificate of Incorporation of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 8-K filed May 10, 2011 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(h)     Certificate of Amendment of Second Restated Certificate of Incorporation of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 8-K filed May 6, 2014 (File No. 001-08923), and incorporated herein by reference thereto).

3.1(i)       Certificate of Amendment of Second Restated Certificate of Incorporation of the Company (filed with the Commission as Exhibit 3.1 to the Company’s Form 8-K filed September 30, 2015 (File No. 001-08923), and incorporated herein by reference thereto).

3.2          Fifth Amended and Restated By-Laws of the Company (filed with the Commission as Exhibit 3.2 to the Company’s Form 10-Q filed October 30, 2015 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(a)     Indenture, dated as of March 15, 2010, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.1 to the Company’s Form 8-K filed March 15, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(b)     Supplemental Indenture No. 1, dated as of March 15, 2010, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed March 15, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(c)      Amendment No. 1 to Supplemental Indenture No. 1, dated as of June 18, 2010, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.3 to the Company’s Form 8-K filed June 18, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(d)     Supplemental Indenture No. 2, dated as of April 7, 2010, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed April 7, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(e)      Amendment No. 1 to Supplemental Indenture No. 2, dated as of June 8, 2010, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.3 to the Company’s Form 8-K filed June 8, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

91


  

4.1(f)      Supplemental Indenture No. 3, dated as of September 10, 2010, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed September 13, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(g)      Supplemental Indenture No. 4, dated as of November 16, 2010, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed November 16, 2010 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(h)     Supplemental Indenture No. 5, dated as of March 14, 2011, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed March 14, 2011 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(i)       Supplemental Indenture No. 6, dated as of April 3, 2012, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed April 4, 2012 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(j)      Supplemental Indenture No. 7, dated as of December 6, 2012, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed December 11, 2012 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(k)     Supplemental Indenture No. 8, dated as of October 7, 2013, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed October 9, 2013 (File No. 001-08923), and incorporated herein by reference thereto).  

4.1(l)       Supplemental Indenture No. 9, dated as of November 20, 2013, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed November 20, 2013 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(m)    Supplemental Indenture No. 10, dated as of November 25, 2014, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed November 25, 2014 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(n)     Supplemental Indenture No. 11, dated as of May 26, 2015, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed May 27, 2015 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(o)     Amendment No. 1 to Supplemental Indenture No. 11, dated as of October 19, 2015, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.3 to the Company’s Form 8-K filed October 20, 2015 (File No. 001-08923), and incorporated herein by reference thereto).

4.1(p)     Supplemental Indenture No. 12, dated as of March 1, 2016, between the Company and The Bank of New York Mellon Trust Company, N.A. (filed with the Commission as Exhibit 4.2 to the Company’s Form 8-K filed March 3, 2016 (File No. 001-08923), and incorporated herein by reference thereto).

4.2          Form of Indenture for Senior Subordinated Debt Securities (filed with the Commission as Exhibit 4.9 to the Company’s Form S-3 (File No. 333-73936) filed November 21, 2001, and incorporated herein by reference thereto).

4.3          Form of Indenture for Junior Subordinated Debt Securities (filed with the Commission as Exhibit 4.10 to the Company’s Form S-3 (File No. 333-73936) filed November 21, 2001, and incorporated herein by reference thereto).

4.4(a)     Indenture, dated as of November 25, 2015, by and among HCN Canadian Holdings-1 LP, the Company and BNY Trust Company of Canada (filed with the Commission as Exhibit 4.5(a) to the Company’s Form 10-K  filed February 18, 2016 (File No. 001-08923), and incorporated herein by reference thereto).

4.4(b)     First Supplemental Indenture, dated as of November 25, 2015, by and among HCN Canadian Holdings-1 LP, the Company and BNY Trust Company of Canada (filed with the Commission as Exhibit 4.5(b) to the Company’s Form 10-K filed February 18, 2016 (File No. 001-08923), and incorporated herein by reference thereto).

92


  

10.1        Credit Agreement dated as of May 13, 2016 by and among the Company; the lenders listed therein; KeyBank National Association, as administrative agent, L/C issuer and a swingline lender; Bank of America, N.A. and JPMorgan Chase Bank, N.A., as co-syndication agents; Deutsche Bank Securities Inc., as documentation agent; Merrill Lynch, Pierce, Fenner & Smith Incorporated, JPMorgan Chase Bank, N.A., KeyBanc Capital Markets Inc. and Deutsche Bank Securities Inc., as U.S. joint lead arrangers; Merrill Lynch, Pierce, Fenner & Smith Incorporated, JPMorgan Chase Bank, N.A., KeyBanc Capital Markets Inc. and RBC Capital Markets, as Canadian joint lead arrangers; and Merrill Lynch, Pierce, Fenner & Smith Incorporated and JPMorgan Chase Bank, N.A., as joint book runners (filed with the Commission as Exhibit 10.1 to the Company’s Form 8-K filed May 16, 2016 (File No. 001-08923), and incorporated herein by reference thereto).

10.2        Equity Purchase Agreement, dated as of February 28, 2011, by and among the Company, FC-GEN Investment, LLC and FC-GEN Operations Investment, LLC (filed with the Commission as Exhibit 10.1 to the Company’s Form 8-K filed February 28, 2011 (File No. 001-08923), and incorporated herein by reference thereto).

10.3(a)   Amended and Restated Health Care REIT, Inc. 2005 Long-Term Incentive Plan (filed with the Commission as Appendix A to the Company’s Proxy Statement for the 2009 Annual Meeting of Stockholders, filed March 25, 2009 (File No. 001-08923), and incorporated herein by reference thereto).*

10.3(b)   Form of Stock Option Agreement (with Dividend Equivalent Rights) for Executive Officers under the 2005 Long-Term Incentive Plan (filed with the Commission as Exhibit 10.9 to the Company’s Form 8-K filed January 5, 2009 (File No. 001-08923), and incorporated herein by reference thereto).*

10.3(c)   Form of Stock Option Agreement (without Dividend Equivalent Rights) for Executive Officers under the Amended and Restated 2005 Long-Term Incentive Plan (filed with the Commission as Exhibit 10.2 to the Company’s Form 10-Q filed May 10, 2010 (File No. 001-08923), and incorporated herein by reference thereto).*

10.3(d)   Form of Restricted Stock Agreement for the Chief Executive Officer under the Amended and Restated 2005 Long-Term Incentive Plan (filed with the Commission as Exhibit 10.3 to the Company’s Form 10-Q filed May 10, 2010 (File No. 001-08923), and incorporated herein by reference thereto).*

10.3(e)   Form of Restricted Stock Agreement for Executive Officers under the Amended and Restated 2005 Long-Term Incentive Plan (filed with the Commission as Exhibit 10.4 to the Company’s Form 10-Q filed May 10, 2010 (File No. 001-08923), and incorporated herein by reference thereto).*

10.4(a)   Amended and Restated Employment Agreement, dated January 3, 2017, between the Company and Thomas J. DeRosa (filed with the Commission as Exhibit 10.4(a) to the Company’s Form 10-K filed February 22, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.4(b)   Performance-Based Restricted Stock Unit Grant Agreement, dated effective as of July 30, 2014, between the Company and Thomas J. DeRosa (filed with the Commission as Exhibit 10.2 to the Company’s Form 10-Q filed November 4, 2014 (File No. 001-08923), and incorporated herein by reference thereto).*

10.5(a)   Employment Contract, dated May 6, 2014, between HCN UK Management Services Limited and John Goodey.*

10.5(b)   Deed of Assignment and Amendment of Employment Contract, dated effective October 3, 2017, between HCN UK Management Services Limited, John Goodey, and the Company.*

10.6        Third Amended and Restated Employment Agreement, dated June 16, 2017, between the Company and Scott A. Estes (filed with the Commission as Exhibit 10.1 to the Company’s Form 10-Q filed July 28, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.7        Resignation Agreement, dated October 3, 2017, between the Company and Scott A. Estes (filed with the Commission as Exhibit 10.1 to the Company’s Form 10-Q filed November 7, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.8        Amended and Restated Employment Agreement, dated December 29, 2008, between the Company and Jeffrey H. Miller (filed with the Commission as Exhibit 10.8 to the Company’s Form 10-K filed March 2, 2009 (File No. 001-08923), and incorporated herein by reference thereto).*

93


  

10.9        Executive Retirement Agreement, dated as of February 16, 2017, by and between Jeffery H. Miller and the Company (filed with the Commission as Exhibit 10.8 to the Company’s Form 10-K filed February 22, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.10      Amended and Restated Employment Agreement, dated June 16, 2017, by and between the Company and Mercedes T. Kerr (filed with the Commission as Exhibit 10.2 to the Company’s Form 10-Q filed July 28, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.11      Form of Indemnification Agreement between the Company and each director, executive officer and officer of the Company (filed with the Commission as Exhibit 10.1 to the Company’s Form 8-K filed February 18, 2005 (File No. 001-08923), and incorporated herein by reference thereto).*

10.12      Summary of Director Compensation.*

10.13(a) Health Care REIT, Inc. 2015-2017 Long-Term Incentive Program (filed with the Commission as Exhibit 10.3 to the Company’s Form 10-Q filed August 4, 2015 (File No. 001-08923), and incorporated herein by reference thereto).*

10.13(b) Form of Performance Restricted Stock Unit Award Agreement under the 2015-2017 Long-Term Incentive Program (filed with the Commission as Exhibit 10.4 to the Company’s Form 10-Q filed August 4, 2015 (File No. 001-08923), and incorporated herein by reference thereto).*

10.14(a) Welltower Inc. 2016 Long-Term Incentive Plan (filed with the Commission as Exhibit 10.1 to the Company’s Form 8-K filed May 10, 2016 (File No. 001-08923), and incorporated herein by reference thereto).*

10.14(b) Form of Restricted Stock Grant Notice for Executive Officers under the 2016 Long-Term Incentive Plan.*

10.14(c) Form of Restricted Stock Grant Notice for Senior Vice Presidents under the 2016 Long-Term Incentive Plan.*

10.14(d) Form of Deferred Stock Unit Grant Agreement for Non-Employee Directors under the 2016 Long-Term Incentive Plan.*

10.15(a) Welltower Inc. 2016-2018 Long-Term Incentive Program (filed with the Commission as Exhibit 10.3 to the Company’s Form 10-Q filed August 2, 2016 (File No. 001-08923), and incorporated herein by reference thereto).*

10.15(b) Form of Performance Restricted Stock Unit Award Agreement under the 2016-2018 Long-Term Incentive Program.*

10.16(a) Welltower Inc. 2017-2019 Long-Term Incentive Program (filed with the Commission as Exhibit 10.4 to the Company’s Form 10-Q filed May 5, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.16(b) Form of Award Notice under the 2017-2019 Long-Term Incentive Program.*

10.16(c) Welltower Inc. 2017-2019 Long-Term Incentive Program – Bridge 1 (filed with the Commission as Exhibit 10.2 to the Company’s Form 10-Q filed November 7, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.16(d) Form of Award Notice under the 2017-2019 Long Term Incentive Program – Bridge 1.*

10.16(e) Welltower Inc. 2017-2019 Long-Term Incentive Program – Bridge 2 (filed with the Commission as Exhibit 10.3 to the Company’s Form 10-Q filed November 7, 2017 (File No. 001-08923), and incorporated herein by reference thereto).*

10.16(f) Form of Award Notice under the 2017-2019 Long Term Incentive Program – Bridge 2.*

10.17(a) Welltower Inc. 2018-2020 Long-Term Incentive Program.*

10.17(b) Form of Restricted Stock Unit Award Agreement under the 2018-2020 Long-Term Incentive Program.*

12           Statement Regarding Computation of Ratio of Earnings to Fixed Charges and Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends (Unaudited).

21           Subsidiaries of the Company.

23           Consent of Ernst & Young LLP, independent registered public accounting firm.

94


  

24           Powers of Attorney.

31.1        Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.

31.2        Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.

32.1        Certification pursuant to 18 U.S.C. Section 1350 by Chief Executive Officer.

32.2        Certification pursuant to 18 U.S.C. Section 1350 by Chief Financial Officer.

101.INS     XBRL Instance Document**

101.SCH   XBRL Taxonomy Extension Schema Document**

101.CAL   XBRL Taxonomy Extension Calculation Linkbase Document**

101.LAB   XBRL Taxonomy Extension Label Linkbase Document**

101.PRE    XBRL Taxonomy Extension Presentation Linkbase Document**

101.DEF    XBRL Taxonomy Extension Definition Linkbase Document**

                           

 

*

 

Management Contract or Compensatory Plan or Arrangement.

**

 

Attached as Exhibit 101 to this Annual Report on Form 10-K are the following materials, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets at December 31, 2017 and 2016, (ii) the Consolidated Statements of Comprehensive Income for the years ended December 31, 2017, 2016 and 2015, (iii) the Consolidated Statements of Equity for the years ended December 31, 2017, 2016 and 2015, (iv) the Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016 and 2015, (v) the Notes to Consolidated Financial Statements, (vi) Schedule III – Real Estate and Accumulated Depreciation and (vii) Schedule IV – Mortgage Loans on Real Estate.

 

 

Item 16.  Form 10-K Summary

Not applicable.

  

95


  

SIGNATURES

    Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date:  February 28, 2018

                                                                                                                   WELLTOWER INC.

 

                                                                                                                   By: /s/  T homas J. DeRosa                                             

                                                                                                                           Thomas J. DeRosa,

                                                                                                                           Chief Executive Officer and Director

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on February 28, 2018 by the following persons on behalf of the Registrant and in the capacities indicated.

 

                        /s/  Jeffrey H. Donahue **                        

                                        /s/  Sergio D. Rivera **                             

          Jeffrey H. Donahue, Chairman of the Board           

                                        Sergio D. Rivera, Director                             

 

 

                          /s/  Kenneth J. Bacon **                           

                                     /s/  R. Scott Trumbull **                          

                          Kenneth J. Bacon, Director                              

                                       R. Scott Trumbull, Director                           

 

 

                             /s/  Fred S. Klipsch **                             

                                        /s/  Gary Whitelaw **                             

                             Fred S. Klipsch, Director                                

                Gary Whitelaw, Director

 

 

                        /s/  Geoffrey G. Meyers  **                        

                                       /s/  Thomas J. DeRosa **                           

                        Geoffrey G. Meyers, Director                         

     Thomas J. DeRosa, Chief Executive Officer and Director

 

                                     (Principal Executive Officer)                          

 

 

                      /s/  Timothy J. Naughton  **                       

                                         /s/  John A. Goodey **                              

                       Timothy J. Naughton, Director                       

                John A. Goodey, Executive Vice President and Chief    

 

                      Financial Officer (Principal Financial Officer)

 

 

                           /s/  Sharon M. Oster **                           

                 /s/  Paul D. Nungester, Jr.**                                         

                           Sharon M. Oster, Director                            

                 Paul D. Nungester, Jr., Senior Vice President and

 

                   Controller (Principal Accounting Officer)

                           /s/  Judith C. Pelham **                           

**By:                                                                      /s/  Thomas J. DeRosa          

                           Judith C. Pelham, Director                           

Thomas J. DeRosa, Attorney-in-Fact

 

 

 

 

 

 

 

 

 

 

 

 

 

 

96


  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Welltower Inc.

 

 

Schedule III

 

 

Real Estate and Accumulated Depreciation

 

 

December 31, 2017

 

 

(Dollars in thousands)

 

 

 

Initial Cost to Company

 

 

 

Gross Amount at Which Carried at Close of Period

 

 

 

 

 

 

Description

 

Encumbrances

 

Land

 

Building & Improvements

 

Cost Capitalized Subsequent to Acquisition

 

Land

 

Building & Improvements

 

Accumulated Depreciation(1)

 

Year Acquired

 

Year Built

 

Address

Triple-net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Abilene, TX

$

-

$

950

$

20,987

$

361

$

950

$

21,348

$

1,990

 

2014

 

1998

 

6565 Central Park Boulevard

Abilene, TX

 

-

 

990

 

8,187

 

1,089

 

990

 

9,276

 

739

 

2014

 

1985

 

1250 East N 10th Street

Aboite Twp, IN

 

-

 

1,770

 

19,930

 

1,601

 

1,770

 

21,531

 

4,048

 

2010

 

2008

 

611 W County Line Rd South

Agawam, MA

 

-

 

880

 

16,112

 

2,134

 

880

 

18,246

 

7,621

 

2002

 

1993

 

1200 Suffield St.

Albertville, AL

 

-

 

170

 

6,203

 

280

 

176

 

6,477

 

1,613

 

2010

 

1999

 

151 Woodham Dr.

Ames, IA

 

-

 

330

 

8,870

 

-

 

330

 

8,870

 

1,835

 

2010

 

1999

 

1325 Coconino Rd.

Anderson, SC

 

-

 

710

 

6,290

 

419

 

710

 

6,709

 

3,278

 

2003

 

1986

 

311 Simpson Rd.

Ankeny, IA

 

-

 

1,129

 

10,270

 

-

 

1,129

 

10,270

 

534

 

2016

 

2012

 

1275 SW State Street

Apple Valley, CA

 

-

 

480

 

16,639

 

168

 

486

 

16,801

 

4,199

 

2010

 

1999

 

11825 Apple Valley Rd.

Asheboro, NC

 

-

 

290

 

5,032

 

165

 

290

 

5,197

 

2,019

 

2003

 

1998

 

514 Vision Dr.

Asheville, NC

 

-

 

204

 

3,489

 

-

 

204

 

3,489

 

1,777

 

1999

 

1999

 

4 Walden Ridge Dr.

Asheville, NC

 

-

 

280

 

1,955

 

351

 

280

 

2,306

 

983

 

2003

 

1992

 

308 Overlook Rd.

Atchison, KS

 

-

 

140

 

5,610

 

19

 

140

 

5,629

 

316

 

2015

 

2001

 

1301 N 4th St.

Atlanta, GA

 

-

 

2,058

 

14,914

 

1,143

 

2,080

 

16,035

 

11,518

 

1997

 

1999

 

1460 S Johnson Ferry Rd.

Aurora, OH

 

-

 

1,760

 

14,148

 

106

 

1,760

 

14,254

 

2,943

 

2011

 

2002

 

505 S. Chillicothe Rd

Aurora, CO

 

-

 

2,440

 

28,172

 

-

 

2,440

 

28,172

 

10,233

 

2006

 

2007

 

14211 E. Evans Ave.

Austin, TX

 

-

 

880

 

9,520

 

1,216

 

885

 

10,731

 

5,451

 

1999

 

1998

 

12429 Scofield Farms Dr.

Avon, IN

 

-

 

1,830

 

14,470

 

-

 

1,830

 

14,470

 

3,127

 

2010

 

2004

 

182 S Country RD. 550E

Avon, IN

 

-

 

900

 

19,444

 

-

 

900

 

19,444

 

1,762

 

2014

 

2013

 

10307 E. CR 100 N

Avon Lake, OH

 

-

 

790

 

10,421

 

5,822

 

790

 

16,243

 

2,666

 

2011

 

2001

 

345 Lear Rd.

Baldwin City, KS

 

-

 

190

 

4,810

 

48

 

190

 

4,858

 

279

 

2015

 

2000

 

321 Crimson Ave

Bartlesville, OK

 

-

 

100

 

1,380

 

-

 

100

 

1,380

 

795

 

1996

 

1995

 

5420 S.E. Adams Blvd.

Bellingham, WA

 

-

 

1,500

 

19,861

 

321

 

1,507

 

20,175

 

4,945

 

2010

 

1996

 

4415 Columbine Dr.

Benbrook, TX

 

-

 

1,550

 

13,553

 

2,206

 

1,550

 

15,759

 

2,484

 

2011

 

1984

 

4242 Bryant Irvin Road

Bethel Park, PA

 

-

 

1,700

 

16,007

 

-

 

1,700

 

16,007

 

3,837

 

2007

 

2009

 

5785 Baptist Road

Beverly Hills, CA

 

-

 

6,000

 

13,385

 

-

 

6,000

 

13,385

 

1,079

 

2014

 

2000

 

220 N Clark Drive

Bexleyheath, UKI

 

-

 

3,750

 

10,807

 

1,407

 

4,113

 

11,851

 

970

 

2014

 

1996

 

35 West Street

Birmingham, UKG

 

-

 

1,647

 

14,853

 

1,594

 

1,806

 

16,288

 

1,160

 

2015

 

2010

 

Clinton Street, Winson Green

Birmingham, UKG

 

-

 

1,591

 

19,092

 

1,998

 

1,745

 

20,937

 

1,469

 

2015

 

2010

 

Braymoor Road, Tile Cross

Birmingham, UKG

 

-

 

1,462

 

9,056

 

1,016

 

1,603

 

9,931

 

718

 

2015

 

2010

 

Clinton Street, Winson Green

Birmingham, UKG

 

-

 

1,184

 

10,085

 

1,089

 

1,299

 

11,059

 

782

 

2015

 

1997

 

122 Tile Cross Road, Garretts Green

Bloomington, IN

 

-

 

670

 

17,423

 

-

 

670

 

17,423

 

1,156

 

2015

 

2015

 

363 S. Fieldstone Boulevard

Boardman, OH

 

-

 

1,200

 

12,800

 

-

 

1,200

 

12,800

 

3,877

 

2008

 

2008

 

8049 South Ave.

Bowling Green, KY

 

-

 

3,800

 

26,700

 

149

 

3,800

 

26,849

 

6,423

 

2008

 

1992

 

1300 Campbell Lane

Bracknell, UKJ

 

-

 

4,329

 

12,167

 

-

 

4,329

 

12,167

 

108

 

2014

 

2017

 

Bagshot Road

Bradenton, FL

 

-

 

252

 

3,298

 

-

 

252

 

3,298

 

1,915

 

1996

 

1995

 

6101 Pointe W. Blvd.

Bradenton, FL

 

-

 

480

 

9,953

 

-

 

480

 

9,953

 

1,450

 

2012

 

2000

 

2800 60th Avenue West

Braintree, MA

 

-

 

170

 

7,157

 

1,290

 

170

 

8,447

 

8,414

 

1997

 

1968

 

1102 Washington St.

Braintree, UKH

 

-

 

-

 

13,296

 

1,285

 

-

 

14,581

 

1,281

 

2014

 

2009

 

Meadow Park Tortoiseshell Way

Brandon, MS

 

-

 

1,220

 

10,241

 

-

 

1,220

 

10,241

 

2,011

 

2010

 

1999

 

140 Castlewoods Blvd

Brecksville, OH

 

-

 

990

 

19,353

 

-

 

990

 

19,353

 

1,746

 

2014

 

2011

 

8757 Brecksville Road

Brentwood, UKH

 

38,810

 

8,537

 

45,869

 

5,304

 

9,362

 

50,348

 

1,335

 

2016

 

2013

 

London Road

Brick, NJ

 

-

 

1,290

 

25,247

 

916

 

1,290

 

26,163

 

4,357

 

2011

 

2000

 

458 Jack Martin Blvd.

Brick, NJ

 

-

 

1,170

 

17,372

 

1,405

 

1,188

 

18,758

 

3,605

 

2010

 

1998

 

515 Jack Martin Blvd

Brick, NJ

 

-

 

690

 

17,125

 

5,548

 

692

 

22,671

 

3,534

 

2010

 

1999

 

1594 Route 88

Bridgewater, NJ

 

-

 

1,850

 

3,050

 

48

 

1,850

 

3,098

 

1,546

 

2004

 

1970

 

875 Route 202/206 North

Bridgewater, NJ

 

-

 

1,730

 

48,201

 

1,406

 

1,766

 

49,571

 

8,989

 

2010

 

1999

 

2005 Route 22 West

Bridgewater, NJ

 

-

 

1,800

 

31,810

 

1,347

 

1,800

 

33,157

 

5,419

 

2011

 

2001

 

680 US-202/206 North

Broadview Heights, OH

 

-

 

920

 

12,400

 

2,393

 

920

 

14,793

 

5,769

 

2001

 

1984

 

2801 E. Royalton Rd.

Brookfield, WI

 

-

 

1,300

 

12,830

 

-

 

1,300

 

12,830

 

1,435

 

2012

 

2013

 

1185 Davidson Road

Brooks, AB

 

2,016

 

376

 

4,951

 

563

 

415

 

5,474

 

483

 

2014

 

2000

 

951 Cassils Road West

Burleson, TX

 

-

 

670

 

13,985

 

1,646

 

670

 

15,631

 

2,588

 

2011

 

1988

 

300 Huguley Boulevard

Burlington, NC

 

-

 

280

 

4,297

 

707

 

280

 

5,004

 

1,917

 

2003

 

2000

 

3619 S. Mebane St.

Burlington, NC

 

-

 

460

 

5,467

 

-

 

460

 

5,467

 

2,142

 

2003

 

1997

 

3615 S. Mebane St.

Burlington, NJ

 

-

 

1,700

 

12,554

 

501

 

1,700

 

13,055

 

2,809

 

2011

 

1965

 

115 Sunset Road

Burlington, NJ

 

-

 

1,170

 

19,205

 

172

 

1,170

 

19,377

 

3,560

 

2011

 

1994

 

2305 Rancocas Road

Burnaby, BC

 

8,341

 

7,623

 

13,844

 

2,267

 

8,429

 

15,306

 

1,372

 

2014

 

2006

 

7195 Canada Way

Calgary, AB

 

17,109

 

2,341

 

42,768

 

4,787

 

2,588

 

47,307

 

4,026

 

2014

 

1971

 

1729-90th Avenue SW

Calgary, AB

 

28,391

 

4,569

 

70,199

 

7,897

 

5,051

 

77,613

 

6,544

 

2014

 

2001

 

500 Midpark Way SE

Camberley, UKJ

 

-

 

10,580

 

41,548

 

-

 

10,580

 

41,548

 

559

 

2016

 

2017

 

Pembroke Broadway

Canton, MA

 

-

 

820

 

8,201

 

263

 

820

 

8,464

 

6,353

 

2002

 

1993

 

One Meadowbrook Way

Canton, OH

 

-

 

300

 

2,098

 

-

 

300

 

2,098

 

1,066

 

1998

 

1998

 

1119 Perry Dr., N.W.

Cape Coral, FL

 

-

 

530

 

3,281

 

-

 

530

 

3,281

 

1,396

 

2002

 

2000

 

911 Santa Barbara Blvd.

Cape Coral, FL

 

8,530

 

760

 

18,868

 

-

 

760

 

18,868

 

2,778

 

2012

 

2009

 

831 Santa Barbara Boulevard

Cape May Court House, NJ

 

-

 

1,440

 

17,002

 

1,775

 

1,440

 

18,777

 

1,746

 

2014

 

1990

 

144 Magnolia Drive

Carmel, IN

 

-

 

1,700

 

19,491

 

-

 

1,700

 

19,491

 

1,421

 

2015

 

2015

 

12315 Pennsylvania Street

Carrollton, TX

 

-

 

2,010

 

19,549

 

-

 

2,010

 

19,549

 

663

 

2014

 

2016

 

2645 East Trinity Mills Road

Cary, NC

 

-

 

1,500

 

4,350

 

986

 

1,500

 

5,336

 

2,570

 

1998

 

1996

 

111 MacArthur

Castleton, IN

 

-

 

920

 

15,137

 

-

 

920

 

15,137

 

1,427

 

2014

 

2013

 

8405 Clearvista Lake

Cedar Grove, NJ

 

-

 

2,850

 

27,737

 

20

 

2,850

 

27,757

 

5,210

 

2011

 

1970

 

536 Ridge Road

Centreville, MD

 

-

 

600

 

14,602

 

241

 

600

 

14,843

 

2,822

 

2011

 

1978

 

205 Armstrong Avenue

Chapel Hill, NC

 

-

 

354

 

2,646

 

783

 

354

 

3,429

 

1,428

 

2002

 

1997

 

100 Lanark Rd.

Charles Town, WV

 

-

 

230

 

22,834

 

140

 

230

 

22,974

 

4,081

 

2011

 

1997

 

219 Prospect Ave

Charleston, WV

 

-

 

440

 

17,575

 

306

 

440

 

17,881

 

3,203

 

2011

 

1998

 

1000 Association Drive, North Gate Business Park

Chatham, VA

 

-

 

320

 

14,039

 

-

 

320

 

14,039

 

1,372

 

2014

 

2009

 

100 Rorer Street

Chelmsford, MA

 

-

 

1,040

 

10,951

 

1,499

 

1,040

 

12,450

 

4,320

 

2003

 

1997

 

4 Technology Dr.

Chester, VA

 

-

 

1,320

 

18,127

 

-

 

1,320

 

18,127

 

1,733

 

2014

 

2009

 

12001 Iron Bridge Road

Chickasha, OK

 

-

 

85

 

1,395

 

-

 

85

 

1,395

 

798

 

1996

 

1996

 

801 Country Club Rd.

Cinnaminson, NJ

 

-

 

860

 

6,663

 

172

 

860

 

6,835

 

1,461

 

2011

 

1965

 

1700 Wynwood Drive

Citrus Heights, CA

 

-

 

2,300

 

31,876

 

589

 

2,300

 

32,465

 

8,132

 

2010

 

1997

 

7418 Stock Ranch Rd.

Claremore, OK

 

-

 

155

 

1,427

 

6,130

 

155

 

7,557

 

1,410

 

1996

 

1996

 

1605 N. Hwy. 88

Clarksville, TN

 

-

 

330

 

2,292

 

-

 

330

 

2,292

 

1,159

 

1998

 

1998

 

2183 Memorial Dr.

Clayton, NC

 

-

 

520

 

15,733

 

-

 

520

 

15,733

 

1,339

 

2014

 

2013

 

84 Johnson Estate Road

Cleburne, TX

 

-

 

520

 

5,369

 

-

 

520

 

5,369

 

1,524

 

2006

 

2007

 

402 S Colonial Drive

Clevedon, UKK

 

-

 

2,838

 

16,927

 

1,910

 

3,112

 

18,563

 

1,631

 

2014

 

1994

 

18/19 Elton Road

Cobham, UKJ

 

-

 

9,808

 

24,991

 

3,362

 

10,756

 

27,406

 

3,164

 

2013

 

2013

 

Redhill Road

Colchester, CT

 

-

 

980

 

4,860

 

544

 

980

 

5,404

 

1,252

 

2011

 

1986

 

59 Harrington  Court

Colorado Springs, CO

 

-

 

4,280

 

62,168

 

-

 

4,280

 

62,168

 

3,730

 

2015

 

2008

 

1605 Elm Creek View

Colorado Springs, CO

 

-

 

1,730

 

25,493

 

693

 

1,730

 

26,186

 

1,184

 

2016

 

2016

 

2818 Grand Vista Circle

Colts Neck, NJ

 

-

 

780

 

14,733

 

1,371

 

1,082

 

15,802

 

3,108

 

2010

 

2002

 

3 Meridian Circle

Columbia, TN

 

-

 

341

 

2,295

 

-

 

341

 

2,295

 

1,165

 

1999

 

1999

 

5011 Trotwood Ave.

Columbia Heights, MN

 

-

 

825

 

14,175

 

163

 

825

 

14,338

 

2,359

 

2011

 

2009

 

3807 Hart Boulevard

Columbus, IN

 

-

 

610

 

3,190

 

-

 

610

 

3,190

 

676

 

2010

 

1998

 

2564 Foxpointe Dr.

Concord, NC

 

-

 

550

 

3,921

 

55

 

550

 

3,976

 

1,693

 

2003

 

1997

 

2452 Rock Hill Church Rd.

Concord, NH

 

-

 

1,760

 

43,179

 

634

 

1,760

 

43,813

 

7,855

 

2011

 

1994

 

239 Pleasant Street

Congleton, UKD

 

-

 

2,036

 

5,120

 

691

 

2,232

 

5,615

 

460

 

2014

 

1994

 

Rood Hill

Conroe, TX

 

-

 

980

 

7,771

 

-

 

980

 

7,771

 

1,736

 

2009

 

2010

 

903 Longmire Road

Coppell, TX

 

-

 

1,550

 

8,386

 

100

 

1,550

 

8,486

 

1,084

 

2012

 

2013

 

1530 East Sandy Lake Road

Corby, UKF

 

-

 

1,228

 

5,144

 

-

 

1,228

 

5,144

 

108

 

2017

 

1997

 

25 Rockingham Road

Coventry, UKG

 

-

 

1,962

 

13,830

 

1,526

 

2,151

 

15,166

 

1,113

 

2015

 

2014

 

Banner Lane, Tile Hill

Crawfordsville, IN

 

-

 

720

 

17,239

 

1,426

 

720

 

18,665

 

1,695

 

2014

 

2013

 

517 Concord Road

Danville, VA

 

-

 

410

 

3,954

 

722

 

410

 

4,676

 

1,853

 

2003

 

1998

 

149 Executive Ct.

Danville, VA

 

-

 

240

 

8,436

 

-

 

240

 

8,436

 

822

 

2014

 

1996

 

508 Rison Street

Daphne, AL

 

-

 

2,880

 

8,670

 

384

 

2,880

 

9,054

 

1,366

 

2012

 

2001

 

27440 County Road 13

Dedham, MA

 

-

 

1,360

 

9,830

 

-

 

1,360

 

9,830

 

4,418

 

2002

 

1996

 

10 CareMatrix Dr.

Denton, TX

 

-

 

1,760

 

8,305

 

100

 

1,760

 

8,405

 

1,538

 

2010

 

2011

 

2125 Brinker Rd

Derby, UKF

 

-

 

2,503

 

9,058

 

-

 

2,503

 

9,058

 

529

 

2014

 

2015

 

Rykneld Road

Dover, DE

 

-

 

600

 

22,266

 

141

 

600

 

22,407

 

4,104

 

2011

 

1984

 

1080 Silver Lake Blvd.

Dresher, PA

 

-

 

2,060

 

40,236

 

1,148

 

2,120

 

41,324

 

7,471

 

2010

 

2001

 

1405 N. Limekiln Pike

Dundalk, MD

 

-

 

1,770

 

32,047

 

784

 

1,770

 

32,831

 

5,984

 

2011

 

1978

 

7232 German Hill Road

Durham, NC

 

-

 

1,476

 

10,659

 

2,196

 

1,476

 

12,855

 

11,283

 

1997

 

1999

 

4434 Ben Franklin Blvd.

Eagan, MN

 

16,741

 

2,260

 

31,643

 

4

 

2,260

 

31,647

 

1,772

 

2015

 

2004

 

3810 Alder Avenue

East Brunswick, NJ

 

-

 

1,380

 

34,229

 

835

 

1,380

 

35,064

 

5,769

 

2011

 

1998

 

606 Cranbury Rd.

East Norriton, PA

 

-

 

1,200

 

28,129

 

1,604

 

1,264

 

29,670

 

5,414

 

2010

 

1988

 

2101 New Hope St

Eastbourne, UKJ

 

-

 

4,071

 

24,438

 

2,755

 

4,465

 

26,799

 

2,323

 

2014

 

1999

 

Carew Road

Eden, NC

 

-

 

390

 

4,877

 

-

 

390

 

4,877

 

1,931

 

2003

 

1998

 

314 W. Kings Hwy.

Edmond, OK

 

-

 

410

 

8,388

 

-

 

410

 

8,388

 

1,321

 

2012

 

2001

 

15401 North Pennsylvania Avenue

Edmond, OK

 

-

 

1,810

 

14,849

 

1,921

 

1,810

 

16,770

 

1,530

 

2014

 

1985

 

1225 Lakeshore Drive

Edmond, OK

 

-

 

1,650

 

25,167

 

-

 

1,650

 

25,167

 

621

 

2014

 

2017

 

2709 East Danforth Road

Elizabeth City, NC

 

-

 

200

 

2,760

 

2,011

 

200

 

4,771

 

2,152

 

1998

 

1999

 

400 Hastings Lane

Emeryville, CA

 

-

 

2,560

 

57,491

 

641

 

2,560

 

58,132

 

5,204

 

2014

 

2010

 

1440 40th Street

Englewood, NJ

 

-

 

930

 

4,514

 

26

 

930

 

4,540

 

936

 

2011

 

1966

 

333 Grand Avenue

Englishtown, NJ

 

-

 

690

 

12,520

 

1,489

 

769

 

13,930

 

2,718

 

2010

 

1997

 

49 Lasatta Ave

Epsom, UKJ

 

39,175

 

20,159

 

34,803

 

5,346

 

22,106

 

38,201

 

1,014

 

2016

 

2014

 

450-458 Reigate Road

Eureka, KS

 

-

 

50

 

3,950

 

70

 

50

 

4,020

 

225

 

2015

 

1994

 

1820 E River St

Everett, WA

 

-

 

1,400

 

5,476

 

-

 

1,400

 

5,476

 

2,689

 

1999

 

1999

 

2015 Lake Heights Dr.

Fairfield, CA

 

-

 

1,460

 

14,040

 

1,541

 

1,460

 

15,581

 

6,266

 

2002

 

1998

 

3350 Cherry Hills St.

Fairhope, AL

 

-

 

570

 

9,119

 

112

 

570

 

9,231

 

1,402

 

2012

 

1987

 

50 Spring Run Road

Fall River, MA

 

-

 

620

 

5,829

 

4,856

 

620

 

10,685

 

5,212

 

1996

 

1973

 

1748 Highland Ave.

Fanwood, NJ

 

-

 

2,850

 

55,175

 

1,071

 

2,850

 

56,246

 

9,157

 

2011

 

1982

 

295 South Ave.

Faribault, MN

 

-

 

780

 

11,539

 

50

 

780

 

11,590

 

658

 

2015

 

2003

 

828 1st Street NE

Farnborough, UKJ

 

-

 

2,036

 

5,737

 

751

 

2,232

 

6,291

 

501

 

2014

 

1980

 

Bruntile Close, Reading Road

Fayetteville, PA

 

-

 

2,150

 

32,951

 

1,802

 

2,150

 

34,753

 

2,191

 

2015

 

1991

 

6375 Chambersburg Road

Fayetteville, NY

 

-

 

410

 

3,962

 

500

 

410

 

4,462

 

1,866

 

2001

 

1997

 

5125 Highbridge St.

Findlay, OH

 

-

 

200

 

1,800

 

-

 

200

 

1,800

 

976

 

1997

 

1997

 

725 Fox Run Rd.

Fishers, IN

 

-

 

1,500

 

14,500

 

-

 

1,500

 

14,500

 

3,132

 

2010

 

2000

 

9745 Olympia Dr.

Florence, NJ

 

-

 

300

 

2,978

 

-

 

300

 

2,978

 

1,262

 

2002

 

1999

 

901 Broad St.

Florence, AL

 

-

 

353

 

13,049

 

200

 

385

 

13,217

 

3,234

 

2010

 

1999

 

3275 County Road 47

Flourtown, PA

 

-

 

1,800

 

14,830

 

266

 

1,800

 

15,096

 

2,866

 

2011

 

1908

 

350 Haws Lane

Flower Mound, TX

 

-

 

1,800

 

8,414

 

100

 

1,800

 

8,514

 

1,276

 

2011

 

2012

 

4141 Long Prairie Road

Folsom, CA

 

-

 

-

 

33,600

 

-

 

1,582

 

32,018

 

4,045

 

2013

 

2009

 

330 Montrose Drive

Forest City, NC

 

-

 

320

 

4,497

 

-

 

320

 

4,497

 

1,797

 

2003

 

1999

 

493 Piney Ridge Rd.

Fort Ashby, WV

 

-

 

330

 

19,566

 

356

 

330

 

19,922

 

3,512

 

2011

 

1980

 

Diane Drive, Box 686

Fort Collins, CO

 

-

 

3,680

 

58,608

 

-

 

3,680

 

58,608

 

3,505

 

2015

 

2007

 

4750 Pleasant Oak Drive

Fort Wayne, IN

 

-

 

170

 

8,232

 

-

 

170

 

8,232

 

2,408

 

2006

 

2006

 

2626 Fairfield Ave.

Fort Worth, TX

 

-

 

450

 

13,615

 

5,086

 

450

 

18,701

 

3,614

 

2010

 

2011

 

425 Alabama Ave.

Franconia, NH

 

-

 

360

 

11,320

 

70

 

360

 

11,390

 

2,119

 

2011

 

1971

 

93 Main Street

Fredericksburg, VA

 

-

 

1,000

 

20,000

 

1,200

 

1,000

 

21,200

 

6,879

 

2005

 

1999

 

3500 Meekins Dr.

Fredericksburg, VA

 

-

 

1,130

 

23,202

 

-

 

1,130

 

23,202

 

2,045

 

2014

 

2010

 

140 Brimley Drive

Fremont, CA

 

-

 

3,400

 

25,300

 

3,203

 

3,456

 

28,447

 

9,360

 

2005

 

1987

 

2860 Country Dr.

Fresno, CA

 

-

 

2,500

 

35,800

 

118

 

2,500

 

35,918

 

8,599

 

2008

 

1991

 

7173 North Sharon Avenue

Gardner, KS

 

-

 

200

 

2,800

 

91

 

200

 

2,891

 

172

 

2015

 

2000

 

869 Juniper Terrace

Gardnerville, NV

 

-

 

1,143

 

10,831

 

1,075

 

1,164

 

11,885

 

8,717

 

1998

 

1999

 

1565-A Virginia Ranch Rd.

Gastonia, NC

 

-

 

470

 

6,129

 

-

 

470

 

6,129

 

2,390

 

2003

 

1998

 

1680 S. New Hope Rd.

Gastonia, NC

 

-

 

310

 

3,096

 

22

 

310

 

3,118

 

1,283

 

2003

 

1994

 

1717 Union Rd.

Gastonia, NC

 

-

 

400

 

5,029

 

120

 

400

 

5,149

 

2,022

 

2003

 

1996

 

1750 Robinwood Rd.

Georgetown, TX

 

-

 

200

 

2,100

 

-

 

200

 

2,100

 

1,127

 

1997

 

1997

 

2600 University Dr., E.

Gettysburg, PA

 

-

 

590

 

8,913

 

118

 

590

 

9,031

 

1,844

 

2011

 

1987

 

867 York Road

Gig Harbor, WA

 

-

 

1,560

 

15,947

 

253

 

1,583

 

16,177

 

3,863

 

2010

 

1994

 

3213 45th St. Court NW

Granbury, TX

 

-

 

2,550

 

2,940

 

777

 

2,550

 

3,717

 

597

 

2012

 

1996

 

916 East Highway 377

Grand Ledge, MI

 

-

 

1,150

 

16,286

 

5,119

 

1,150

 

21,405

 

3,731

 

2010

 

1999

 

4775 Village Dr

Granger, IN

 

-

 

1,670

 

21,280

 

2,401

 

1,670

 

23,681

 

4,392

 

2010

 

2009

 

6330 North Fir Rd

Grapevine, TX

 

-

 

2,220

 

17,648

 

-

 

2,220

 

17,648

 

1,105

 

2013

 

2014

 

4545 Merlot Drive

Greeley, CO

 

-

 

1,077

 

18,051

 

-

 

1,077

 

18,051

 

270

 

2017

 

2009

 

5300 West 29th Street

Greenfield, WI

 

-

 

-

 

15,204

 

-

 

890

 

14,314

 

1,685

 

2013

 

1983

 

5017 South 110th Street

Greensboro, NC

 

-

 

330

 

2,970

 

554

 

330

 

3,524

 

1,425

 

2003

 

1996

 

5809 Old Oak Ridge Rd.

Greensboro, NC

 

-

 

560

 

5,507

 

1,013

 

560

 

6,520

 

2,618

 

2003

 

1997

 

4400 Lawndale Dr.

Greenville, SC

 

-

 

310

 

4,750

 

-

 

310

 

4,750

 

1,814

 

2004

 

1997

 

23 Southpointe Dr.

Greenville, NC

 

-

 

290

 

4,393

 

168

 

290

 

4,561

 

1,774

 

2003

 

1998

 

2715 Dickinson Ave.

Greenwood, IN

 

-

 

1,550

 

22,770

 

81

 

1,550

 

22,851

 

4,334

 

2010

 

2007

 

2339 South SR 135

Groton, CT

 

-

 

2,430

 

19,941

 

968

 

2,430

 

20,909

 

4,156

 

2011

 

1975

 

1145 Poquonnock Road

Haddonfield, NJ

 

-

 

520

 

16,363

 

-

 

520

 

16,363

 

1,293

 

2011

 

2015

 

132 Warwick Road

Hamburg, PA

 

-

 

840

 

10,543

 

222

 

840

 

10,765

 

2,271

 

2011

 

1966

 

125 Holly Road

Hamilton, NJ

 

-

 

440

 

4,469

 

-

 

440

 

4,469

 

1,882

 

2001

 

1998

 

1645 Whitehorse-Mercerville Rd.

Hanford, UKG

 

-

 

1,382

 

9,829

 

1,083

 

1,515

 

10,779

 

1,257

 

2013

 

2012

 

Bankhouse Road

Harrow, UKI

 

-

 

7,402

 

8,266

 

1,514

 

8,117

 

9,064

 

772

 

2014

 

2001

 

177 Preston Hill

Hatboro, PA

 

-

 

-

 

28,112

 

1,771

 

-

 

29,883

 

5,298

 

2011

 

1996

 

3485 Davisville Road

Hatfield, UKH

 

-

 

2,924

 

7,527

 

1,010

 

3,206

 

8,254

 

970

 

2013

 

2012

 

St Albans Road East

Hattiesburg, MS

 

-

 

450

 

13,469

 

-

 

450

 

13,469

 

2,364

 

2010

 

2009

 

217 Methodist Hospital Blvd

Haverford, PA

 

-

 

1,880

 

33,993

 

1,080

 

1,884

 

35,069

 

6,307

 

2010

 

2000

 

731 Old Buck Lane

Hermitage, TN

 

-

 

1,500

 

9,943

 

-

 

1,500

 

9,943

 

1,695

 

2011

 

2006

 

4131 Andrew Jackson Parkway

Herne Bay, UKJ

 

-

 

1,900

 

24,353

 

2,537

 

2,083

 

26,706

 

3,389

 

2013

 

2011

 

165 Reculver Road

Hiawatha, KS

 

-

 

40

 

4,210

 

29

 

40

 

4,239

 

247

 

2015

 

1996

 

400 Kansas Ave

Hickory, NC

 

-

 

290

 

987

 

232

 

290

 

1,219

 

627

 

2003

 

1994

 

2530 16th St. N.E.

High Point, NC

 

-

 

560

 

4,443

 

793

 

560

 

5,236

 

2,083

 

2003

 

2000

 

1568 Skeet Club Rd.

High Point, NC

 

-

 

370

 

2,185

 

410

 

370

 

2,595

 

1,090

 

2003

 

1999

 

1564 Skeet Club Rd.

High Point, NC

 

-

 

330

 

3,395

 

28

 

330

 

3,423

 

1,370

 

2003

 

1994

 

201 W. Hartley Dr.

High Point, NC

 

-

 

430

 

4,143

 

-

 

430

 

4,143

 

1,646

 

2003

 

1998

 

1560 Skeet Club Rd.

Highland Park, IL

 

-

 

2,820

 

15,832

 

189

 

2,820

 

16,021

 

2,136

 

2011

 

2012

 

1651 Richfield Avenue

Highlands Ranch, CO

 

-

 

940

 

3,721

 

4,983

 

940

 

8,704

 

2,091

 

2002

 

1999

 

9160 S. University Blvd.

Hinckley, UKF

 

-

 

2,159

 

4,194

 

614

 

2,368

 

4,599

 

592

 

2013

 

2013

 

Tudor Road

Hindhead, UKJ

 

47,374

 

17,852

 

48,645

 

6,463

 

19,576

 

53,383

 

1,392

 

2016

 

2012

 

Portsmouth Road

Hockessin, DE

 

-

 

1,120

 

6,308

 

1,247

 

1,120

 

7,555

 

718

 

2014

 

1992

 

100 Saint Claire Drive

Holton, KS

 

-

 

40

 

7,460

 

13

 

40

 

7,473

 

407

 

2015

 

1996

 

410 Juniper Dr

Howard, WI

 

-

 

579

 

32,122

 

-

 

579

 

32,122

 

157

 

2017

 

2016

 

2790 Elm Tree Hill

Howell, NJ

 

8,835

 

1,066

 

21,577

 

769

 

1,071

 

22,341

 

4,129

 

2010

 

2007

 

100 Meridian Place

Hutchinson, KS

 

-

 

600

 

10,590

 

194

 

600

 

10,784

 

3,716

 

2004

 

1997

 

2416 Brentwood

Indianapolis, IN

 

-

 

870

 

14,688

 

-

 

870

 

14,688

 

1,390

 

2014

 

2014

 

1635 N Arlington Avenue

Indianapolis, IN

 

-

 

890

 

18,781

 

-

 

890

 

18,781

 

1,639

 

2014

 

2014

 

5404 Georgetown Road

Jackson, NJ

 

-

 

6,500

 

26,405

 

3,107

 

6,500

 

29,512

 

3,820

 

2012

 

2001

 

2 Kathleen Drive

Jacksonville, FL

 

-

 

750

 

25,231

 

-

 

750

 

25,231

 

987

 

2013

 

2014

 

5939 Roosevelt Boulevard

Jacksonville, FL

 

-

 

-

 

26,381

 

-

 

-

 

26,381

 

1,031

 

2013

 

2014

 

4000 San Pablo Parkway

Kansas City, KS

 

-

 

700

 

20,116

 

-

 

700

 

20,116

 

1,113

 

2015

 

2015

 

8900 Parallel Parkway

Katy, TX

 

-

 

1,778

 

22,622

 

-

 

1,778

 

22,622

 

387

 

2017

 

2015

 

24802 Kingsland Boulevard

Kenner, LA

 

-

 

1,100

 

10,036

 

328

 

1,100

 

10,364

 

9,033

 

1998

 

2000

 

1600 Joe Yenni Blvd

Kennett Square, PA

 

-

 

1,050

 

22,946

 

316

 

1,083

 

23,229

 

4,219

 

2010

 

2008

 

301 Victoria Gardens Dr.

Kingston upon Thames, UKI

 

56,849

 

33,063

 

46,696

 

7,751

 

36,258

 

51,252

 

1,351

 

2016

 

2014

 

Coombe Lane West

Kirkland, WA

 

-

 

1,880

 

4,315

 

683

 

1,880

 

4,998

 

1,792

 

2003

 

1996

 

6505 Lakeview Dr.

Kirkstall, UKE

 

-

 

2,437

 

9,414

 

1,145

 

2,672

 

10,324

 

1,207

 

2013

 

2009

 

29 Broad Lane

Kokomo, IN

 

-

 

710

 

16,044

 

-

 

710

 

16,044

 

1,515

 

2014

 

2014

 

2200 S. Dixon Rd

Lafayette, LA

 

-

 

1,928

 

10,483

 

25

 

1,928

 

10,509

 

4,358

 

2006

 

1993

 

204 Energy Parkway

Lafayette, CO

 

-

 

1,420

 

20,192

 

-

 

1,420

 

20,192

 

1,430

 

2015

 

2015

 

329 Exempla Circle

Lafayette, IN

 

-

 

670

 

16,833

 

-

 

670

 

16,833

 

1,372

 

2015

 

2014

 

2402 South Street

Lakeway, TX

 

-

 

5,142

 

23,203

 

-

 

5,142

 

23,203

 

2,550

 

2007

 

2011

 

2000 Medical Dr

Lakewood, CO

 

-

 

2,160

 

28,091

 

62

 

2,160

 

28,153

 

2,823

 

2014

 

2010

 

7395 West Eastman Place

Lakewood Ranch, FL

 

-

 

650

 

6,714

 

1,988

 

650

 

8,702

 

1,240

 

2011

 

2012

 

8230 Nature's Way

Lakewood Ranch, FL

 

-

 

1,000

 

22,388

 

-

 

1,000

 

22,388

 

3,234

 

2012

 

2005

 

8220 Natures Way

Lancaster, CA

 

-

 

700

 

15,295

 

625

 

712

 

15,907

 

4,279

 

2010

 

1999

 

43051 15th St. West

Lancaster, PA

 

-

 

1,680

 

14,039

 

-

 

1,680

 

14,039

 

364

 

2015

 

2017

 

31 Millersville Road

Langhorne, PA

 

-

 

1,350

 

24,881

 

171

 

1,350

 

25,052

 

4,717

 

2011

 

1979

 

262 Toll Gate Road

LaPlata, MD

 

-

 

700

 

19,068

 

466

 

700

 

19,534

 

3,653

 

2011

 

1984

 

One Magnolia Drive

Las Vegas, NV

 

-

 

580

 

23,420

 

-

 

580

 

23,420

 

3,967

 

2011

 

2002

 

2500 North Tenaya Way

Lawrence, KS

 

-

 

250

 

8,716

 

-

 

250

 

8,716

 

1,245

 

2012

 

1996

 

3220 Peterson Road

Lecanto, FL

 

-

 

200

 

6,900

 

-

 

200

 

6,900

 

2,541

 

2004

 

1986

 

2341 W. Norvell Bryant Hwy.

Lee, MA

 

-

 

290

 

18,135

 

926

 

290

 

19,061

 

7,947

 

2002

 

1998

 

600 & 620 Laurel St.

Leeds, UKE

 

-

 

1,974

 

13,239

 

1,470

 

2,165

 

14,518

 

1,007

 

2015

 

2013

 

100 Grove Lane

Leicester, UKF

 

-

 

3,060

 

24,410

 

2,654

 

3,355

 

26,769

 

3,516

 

2012

 

2010

 

307 London Road

Lenoir, NC

 

-

 

190

 

3,748

 

641

 

190

 

4,389

 

1,739

 

2003

 

1998

 

1145 Powell Rd., N.E.

Lethbridge, AB

 

1,505

 

1,214

 

2,750

 

419

 

1,342

 

3,040

 

348

 

2014

 

2003

 

785 Columbia Boulevard West

Lexana, KS

 

-

 

480

 

1,770

 

148

 

480

 

1,918

 

120

 

2015

 

1994

 

8710 Caenen Lake Rd

Lexington, NC

 

-

 

200

 

3,900

 

1,015

 

200

 

4,915

 

2,011

 

2002

 

1997

 

161 Young Dr.

Libertyville, IL

 

-

 

6,500

 

40,024

 

-

 

6,500

 

40,024

 

7,376

 

2011

 

2001

 

901 Florsheim Dr

Lichfield, UKG

 

-

 

1,382

 

30,324

 

3,063

 

1,515

 

33,254

 

2,350

 

2015

 

2012

 

Wissage Road

Lillington, NC

 

-

 

470

 

17,579

 

-

 

470

 

17,579

 

1,598

 

2014

 

2013

 

54 Red Mulberry Way

Lillington, NC

 

-

 

500

 

16,451

 

-

 

500

 

16,451

 

1,402

 

2014

 

1999

 

2041 NC-210 N

Lincoln, NE

 

-

 

390

 

13,807

 

95

 

390

 

13,902

 

2,789

 

2010

 

2000

 

7208 Van Dorn St.

Linwood, NJ

 

-

 

800

 

21,984

 

1,056

 

859

 

22,980

 

4,341

 

2010

 

1997

 

432 Central Ave

Litchfield, CT

 

-

 

1,240

 

17,908

 

10,991

 

1,258

 

28,882

 

4,068

 

2010

 

1998

 

19 Constitution Way

Lititz, PA

 

-

 

1,200

 

13,836

 

-

 

1,200

 

13,836

 

359

 

2015

 

2016

 

80 West Millport Road

Little Neck, NY

 

-

 

3,350

 

38,461

 

1,265

 

3,357

 

39,720

 

7,308

 

2010

 

2000

 

55-15 Little Neck Pkwy.

Livermore, CA

 

-

 

4,100

 

24,996

 

-

 

4,100

 

24,996

 

2,008

 

2014

 

1974

 

35 Fenton Street

Livingston, NJ

 

-

 

8,000

 

44,424

 

-

 

8,000

 

44,424

 

667

 

2015

 

2017

 

369 E Mt Pleasant Avenue

London, UKI

 

-

 

8,158

 

17,545

 

-

 

8,158

 

17,545

 

579

 

2015

 

2016

 

6 Victoria Drive

Longview, TX

 

-

 

610

 

5,520

 

-

 

610

 

5,520

 

1,576

 

2006

 

2007

 

311 E Hawkins Pkwy

Longwood, FL

 

-

 

1,260

 

6,445

 

-

 

1,260

 

6,445

 

1,172

 

2011

 

2011

 

425 South Ronald Reagan Boulevard

Louisburg, KS

 

-

 

280

 

4,320

 

35

 

280

 

4,355

 

240

 

2015

 

1996

 

202 Rogers St

Louisville, KY

 

-

 

490

 

10,010

 

2,768

 

490

 

12,778

 

4,594

 

2005

 

1978

 

4604 Lowe Rd

Lowell, MA

 

-

 

680

 

3,378

 

44

 

680

 

3,422

 

824

 

2011

 

1969

 

30 Princeton Blvd

Loxley, UKE

 

-

 

1,369

 

15,668

 

1,646

 

1,502

 

17,182

 

2,161

 

2013

 

2008

 

Loxley Road

Lutherville, MD

 

-

 

1,100

 

19,786

 

1,744

 

1,100

 

21,530

 

3,877

 

2011

 

1988

 

515 Brightfield Road

Lynchburg, VA

 

-

 

340

 

16,114

 

-

 

340

 

16,114

 

1,484

 

2014

 

2013

 

189 Monica Blvd

Macungie, PA

 

-

 

960

 

29,033

 

84

 

960

 

29,117

 

5,262

 

2011

 

1994

 

1718 Spring Creek Road

Mahwah, NJ

 

-

 

1,605

 

27,249

 

-

 

1,605

 

27,249

 

1,826

 

2012

 

2015

 

15 Edison Road

Manalapan, NJ

 

-

 

900

 

22,624

 

589

 

900

 

23,213

 

3,813

 

2011

 

2001

 

445 Route 9 South

Manassas, VA

 

-

 

750

 

7,446

 

530

 

750

 

7,976

 

2,899

 

2003

 

1996

 

8341 Barrett Dr.

Mankato, MN

 

-

 

1,460

 

32,104

 

13

 

1,460

 

32,117

 

1,792

 

2015

 

2006

 

100 Dublin Road

Mansfield, TX

 

-

 

660

 

5,251

 

-

 

660

 

5,251

 

1,516

 

2006

 

2007

 

2281 Country Club Dr

Manteca, CA

 

-

 

1,300

 

12,125

 

1,566

 

1,312

 

13,679

 

5,000

 

2005

 

1986

 

430 N. Union Rd.

Marietta, PA

 

-

 

1,050

 

13,633

 

-

 

1,050

 

13,633

 

868

 

2015

 

1999

 

2760 Maytown Road

Marion, IN

 

-

 

720

 

12,750

 

1,136

 

720

 

13,886

 

1,264

 

2014

 

2012

 

614 W. 14th Street

Marion, IN

 

-

 

990

 

9,190

 

824

 

990

 

10,014

 

1,083

 

2014

 

1976

 

505 N. Bradner Avenue

Marlborough, UKK

 

-

 

2,677

 

6,822

 

918

 

2,936

 

7,482

 

622

 

2014

 

1999

 

The Common

Marlow, UKJ

 

-

 

9,619

 

42,134

 

-

 

9,619

 

42,134

 

1,970

 

2013

 

2014

 

210 Little Marlow Road

Martinsville, VA

 

-

 

349

 

-

 

-

 

349

 

-

 

-

 

2003

 

1900

 

Rolling Hills Rd. & US Hwy. 58

Marysville, WA

 

-

 

620

 

4,780

 

903

 

620

 

5,683

 

2,072

 

2003

 

1998

 

9802 48th Dr. N.E.

Matawan, NJ

 

-

 

1,830

 

20,618

 

166

 

1,830

 

20,784

 

3,552

 

2011

 

1965

 

625 State Highway 34

Matthews, NC

 

-

 

560

 

4,738

 

-

 

560

 

4,738

 

1,920

 

2003

 

1998

 

2404 Plantation Center Dr.

McHenry, IL

 

-

 

1,576

 

-

 

-

 

1,576

 

-

 

-

 

2006

 

1900

 

5200 Block of Bull Valley Road

McKinney, TX

 

-

 

1,570

 

7,389

 

-

 

1,570

 

7,389

 

1,666

 

2009

 

2010

 

2701 Alma Rd.

McMurray, PA

 

-

 

1,440

 

15,805

 

3,894

 

1,440

 

19,699

 

3,093

 

2010

 

2011

 

240 Cedar Hill Dr

Mechanicsburg, PA

 

-

 

1,350

 

16,650

 

-

 

1,350

 

16,650

 

2,888

 

2011

 

1971

 

4950 Wilson Lane

Medicine Hat, AB

 

2,471

 

932

 

5,566

 

686

 

1,031

 

6,154

 

559

 

2014

 

1999

 

65 Valleyview Drive SW

Melville, NY

 

-

 

4,280

 

73,283

 

4,616

 

4,306

 

77,874

 

13,828

 

2010

 

2001

 

70 Pinelawn Rd

Mendham, NJ

 

-

 

1,240

 

27,169

 

638

 

1,240

 

27,807

 

5,006

 

2011

 

1968

 

84 Cold Hill Road

Menomonee Falls, WI

 

-

 

1,020

 

6,984

 

1,652

 

1,020

 

8,636

 

2,057

 

2006

 

2007

 

W128 N6900 Northfield Drive

Mercerville, NJ

 

-

 

860

 

9,929

 

173

 

860

 

10,102

 

2,012

 

2011

 

1967

 

2240 White Horse- Merceville Road

Meriden, CT

 

-

 

1,300

 

1,472

 

233

 

1,300

 

1,705

 

623

 

2011

 

1968

 

845 Paddock Ave

Merrillville, IN

 

-

 

700

 

11,699

 

154

 

700

 

11,853

 

3,105

 

2007

 

2008

 

9509 Georgia St.

Mesa, AZ

 

-

 

950

 

9,087

 

1,567

 

950

 

10,654

 

4,657

 

1999

 

2000

 

7231 E. Broadway

Middleburg Heights, OH

 

-

 

960

 

7,780

 

-

 

960

 

7,780

 

2,758

 

2004

 

1998

 

15435 Bagley Rd.

Middleton, WI

 

-

 

420

 

4,006

 

600

 

420

 

4,606

 

1,802

 

2001

 

1991

 

6701 Stonefield  Rd.

Midland, MI

 

-

 

200

 

11,025

 

5,522

 

200

 

16,547

 

2,555

 

2010

 

1994

 

2325 Rockwell Dr

Mill Creek, WA

 

-

 

10,150

 

60,274

 

935

 

10,179

 

61,179

 

17,227

 

2010

 

1998

 

14905 Bothell-Everett Hwy

Millville, NJ

 

-

 

840

 

29,944

 

129

 

840

 

30,073

 

5,532

 

2011

 

1986

 

54 Sharp Street

Milton Keynes, UKJ

 

-

 

1,826

 

18,654

 

1,979

 

2,002

 

20,456

 

1,488

 

2015

 

2007

 

Tunbridge Grove, Kents Hill

Mishawaka, IN

 

-

 

740

 

16,114

 

-

 

740

 

16,114

 

1,569

 

2014

 

2013

 

60257 Bodnar Blvd

Missoula, MT

 

-

 

550

 

7,490

 

377

 

550

 

7,867

 

2,576

 

2005

 

1998

 

3620 American Way

Monmouth Junction, NJ

 

-

 

720

 

6,209

 

86

 

720

 

6,295

 

1,323

 

2011

 

1996

 

2 Deer Park Drive

Monroe, NC

 

-

 

470

 

3,681

 

648

 

470

 

4,329

 

1,750

 

2003

 

2001

 

918 Fitzgerald St.

Monroe, NC

 

-

 

310

 

4,799

 

857

 

310

 

5,656

 

2,181

 

2003

 

2000

 

919 Fitzgerald St.

Monroe, NC

 

-

 

450

 

4,021

 

114

 

450

 

4,135

 

1,669

 

2003

 

1997

 

1316 Patterson Ave.

Monroe Township, NJ

 

-

 

3,250

 

27,771

 

219

 

3,250

 

27,991

 

1,454

 

2015

 

1996

 

319 Forsgate Drive

Monroe Twp, NJ

 

-

 

1,160

 

13,193

 

114

 

1,160

 

13,307

 

2,666

 

2011

 

1996

 

292 Applegarth Road

Montville, NJ

 

-

 

3,500

 

31,002

 

1,073

 

3,500

 

32,075

 

5,350

 

2011

 

1988

 

165 Changebridge Rd.

Moorestown, NJ

 

-

 

2,060

 

51,628

 

1,653

 

2,071

 

53,270

 

9,619

 

2010

 

2000

 

1205 N. Church St

Moorestown, NJ

 

-

 

6,400

 

23,875

 

27

 

6,400

 

23,902

 

2,531

 

2012

 

2014

 

250 Marter Avenue

Morehead City, NC

 

-

 

200

 

3,104

 

1,648

 

200

 

4,752

 

2,149

 

1999

 

1999

 

107 Bryan St.

Morton Grove, IL

 

-

 

1,900

 

19,374

 

159

 

1,900

 

19,533

 

3,201

 

2010

 

2011

 

5520 N. Lincoln Ave.

Moulton, UKF

 

-

 

1,695

 

12,510

 

-

 

1,695

 

12,510

 

247

 

2017

 

1995

 

Northampton Lane North

Mount Pleasant, SC

 

-

 

-

 

17,200

 

-

 

4,052

 

13,149

 

2,586

 

2013

 

1985

 

1200 Hospital Drive

Nacogdoches, TX

 

-

 

390

 

5,754

 

-

 

390

 

5,754

 

1,636

 

2006

 

2007

 

5902 North St

Naperville, IL

 

-

 

3,470

 

29,547

 

-

 

3,470

 

29,547

 

5,550

 

2011

 

2001

 

504 North River Road

Nashville, TN

 

-

 

4,910

 

29,590

 

-

 

4,910

 

29,590

 

7,529

 

2008

 

2007

 

15 Burton Hills Boulevard

Naugatuck, CT

 

-

 

1,200

 

15,826

 

199

 

1,200

 

16,025

 

3,028

 

2011

 

1980

 

4 Hazel Avenue

Needham, MA

 

-

 

1,610

 

13,715

 

366

 

1,610

 

14,081

 

6,424

 

2002

 

1994

 

100 West St.

New Moston, UKD

 

-

 

1,480

 

4,378

 

566

 

1,623

 

4,801

 

585

 

2013

 

2010

 

90a Broadway

Newark, DE

 

-

 

560

 

21,220

 

1,488

 

560

 

22,708

 

7,504

 

2004

 

1998

 

200 E. Village Rd.

Newcastle Under Lyme, UKG

 

-

 

1,110

 

5,655

 

654

 

1,218

 

6,202

 

721

 

2013

 

2010

 

Hempstalls Lane

Newcastle-under-Lyme, UKG

 

-

 

1,125

 

5,537

 

644

 

1,234

 

6,072

 

505

 

2014

 

1999

 

Silverdale Road

Norman, OK

 

-

 

55

 

1,484

 

-

 

55

 

1,484

 

906

 

1995

 

1995

 

1701 Alameda Dr.

Norman, OK

 

-

 

1,480

 

33,330

 

-

 

1,480

 

33,330

 

4,715

 

2012

 

1985

 

800 Canadian Trails Drive

North Augusta, SC

 

-

 

332

 

2,558

 

-

 

332

 

2,558

 

1,288

 

1999

 

1998

 

105 North Hills Dr.

North Cape May, NJ

 

-

 

600

 

22,266

 

118

 

600

 

22,384

 

4,099

 

2011

 

1995

 

700 Townbank Road

Northampton, UKF

 

-

 

5,182

 

17,348

 

2,177

 

5,682

 

19,024

 

2,300

 

2013

 

2011

 

Cliftonville Road

Northampton, UKF

 

-

 

2,013

 

6,257

 

799

 

2,208

 

6,862

 

543

 

2014

 

2014

 

Cliftonville Road

Nuneaton, UKG

 

-

 

3,325

 

8,983

 

1,189

 

3,646

 

9,850

 

1,147

 

2013

 

2011

 

132 Coventry Road

Nuthall, UKF

 

-

 

1,628

 

6,263

 

762

 

1,786

 

6,868

 

530

 

2014

 

2014

 

172A Nottingham Road

Nuthall, UKF

 

-

 

2,498

 

10,436

 

1,250

 

2,740

 

11,444

 

1,346

 

2013

 

2011

 

172 Nottingham Road

Oakland, CA

 

-

 

4,760

 

16,143

 

109

 

4,760

 

16,252

 

1,500

 

2014

 

2002

 

468 Perkins Street

Ocala, FL

 

-

 

1,340

 

10,564

 

-

 

1,340

 

10,564

 

2,468

 

2008

 

2009

 

2650 SE 18TH Avenue

Ogden, UT

 

-

 

360

 

6,700

 

699

 

360

 

7,399

 

2,509

 

2004

 

1998

 

1340 N. Washington Blv.

Oklahoma City, OK

 

-

 

590

 

7,513

 

-

 

590

 

7,513

 

1,968

 

2007

 

2008

 

13200 S. May Ave

Oklahoma City, OK

 

-

 

760

 

7,017

 

-

 

760

 

7,017

 

1,788

 

2007

 

2009

 

11320 N. Council Road

Olathe, KS

 

-

 

1,930

 

19,765

 

553

 

1,930

 

20,318

 

1,138

 

2016

 

2015

 

21250 W 151 Street

Omaha, NE

 

-

 

370

 

10,230

 

-

 

370

 

10,230

 

2,096

 

2010

 

1998

 

11909 Miracle Hills Dr.

Omaha, NE

 

-

 

380

 

8,769

 

-

 

380

 

8,769

 

1,896

 

2010

 

1999

 

5728 South 108th St.

Ona, WV

 

-

 

950

 

15,998

 

-

 

950

 

15,998

 

980

 

2015

 

2007

 

100 Weatherholt Drive

Oneonta, NY

 

-

 

80

 

5,020

 

-

 

80

 

5,020

 

1,315

 

2007

 

1996

 

1846 County Highway 48

Orem, UT

 

-

 

2,150

 

24,107

 

-

 

2,150

 

24,107

 

1,400

 

2015

 

2014

 

250 East Center Street

Osage City, KS

 

-

 

50

 

1,700

 

136

 

50

 

1,836

 

119

 

2015

 

1996

 

1403 Laing St

Osawatomie, KS

 

-

 

130

 

2,970

 

126

 

130

 

3,096

 

186

 

2015

 

2003

 

1520 Parker Ave

Ottawa, KS

 

-

 

160

 

6,590

 

40

 

160

 

6,630

 

370

 

2015

 

2007

 

2250 S Elm St

Overland Park, KS

 

-

 

3,730

 

27,076

 

340

 

3,730

 

27,416

 

6,190

 

2008

 

2009

 

12000 Lamar Avenue

Overland Park, KS

 

-

 

4,500

 

29,105

 

7,295

 

4,500

 

36,400

 

7,345

 

2010

 

1988

 

6101 W 119th St

Overland Park, KS

 

-

 

410

 

2,840

 

70

 

410

 

2,910

 

184

 

2015

 

2004

 

14430 Metcalf Ave

Overland Park, KS

 

-

 

1,300

 

25,311

 

677

 

1,300

 

25,988

 

1,464

 

2016

 

2015

 

7600 Antioch Road

Owasso, OK

 

-

 

215

 

1,380

 

-

 

215

 

1,380

 

769

 

1996

 

1996

 

12807 E. 86th Place N.

Owensboro, KY

 

-

 

225

 

13,275

 

-

 

225

 

13,275

 

4,813

 

2005

 

1964

 

1205 Leitchfield Rd.

Owenton, KY

 

-

 

100

 

2,400

 

-

 

100

 

2,400

 

1,059

 

2005

 

1979

 

905 Hwy. 127 N.

Oxford, MI

 

-

 

1,430

 

15,791

 

-

 

1,430

 

15,791

 

3,172

 

2010

 

2001

 

701 Market St

Palestine, TX

 

-

 

180

 

4,320

 

1,300

 

180

 

5,620

 

1,668

 

2006

 

2005

 

1625 W. Spring St.

Palm Coast, FL

 

-

 

870

 

10,957

 

-

 

870

 

10,957

 

2,421

 

2008

 

2010

 

50 Town Ct.

Panama City Beach, FL

 

-

 

900

 

6,402

 

-

 

900

 

6,402

 

981

 

2011

 

2005

 

6012 Magnolia Beach Road

Paola, KS

 

-

 

190

 

5,610

 

57

 

190

 

5,667

 

320

 

2015

 

2000

 

601 N. East Street

Paris, TX

 

-

 

490

 

5,452

 

-

 

490

 

5,452

 

4,057

 

2005

 

2006

 

750 N Collegiate Dr

Paso Robles, CA

 

-

 

1,770

 

8,630

 

693

 

1,770

 

9,323

 

3,811

 

2002

 

1998

 

1919 Creston Rd.

Pella, IA

 

-

 

870

 

6,716

 

89

 

870

 

6,805

 

955

 

2012

 

2002

 

2602 Fifield Road

Pennington, NJ

 

-

 

1,380

 

27,620

 

937

 

1,476

 

28,462

 

4,740

 

2011

 

2000

 

143 West Franklin Avenue

Pennsauken, NJ

 

-

 

900

 

10,780

 

179

 

900

 

10,959

 

2,340

 

2011

 

1985

 

5101 North Park Drive

Petoskey, MI

 

-

 

860

 

14,452

 

-

 

860

 

14,452

 

2,750

 

2011

 

1997

 

965 Hager Dr

Philadelphia, PA

 

-

 

2,930

 

10,433

 

3,536

 

2,930

 

13,969

 

2,765

 

2011

 

1952

 

1526 Lombard Street

Phillipsburg, NJ

 

-

 

800

 

21,175

 

238

 

800

 

21,413

 

4,046

 

2011

 

1992

 

290 Red School Lane

Phillipsburg, NJ

 

-

 

300

 

8,114

 

101

 

300

 

8,215

 

1,546

 

2011

 

1905

 

843 Wilbur Avenue

Pinehurst, NC

 

-

 

290

 

2,690

 

484

 

290

 

3,174

 

1,320

 

2003

 

1998

 

17 Regional Dr.

Piqua, OH

 

-

 

204

 

1,885

 

-

 

204

 

1,885

 

979

 

1997

 

1997

 

1744 W. High St.

Piscataway, NJ

 

-

 

3,100

 

33,501

 

-

 

3,100

 

33,501

 

477

 

2013

 

2017

 

10 Sterling Drive

Pittsburgh, PA

 

-

 

1,750

 

8,572

 

115

 

1,750

 

8,687

 

3,096

 

2005

 

1998

 

100 Knoedler Rd.

Plainview, NY

 

-

 

3,990

 

11,969

 

1,085

 

3,990

 

13,054

 

2,355

 

2011

 

1963

 

150 Sunnyside Blvd

Plano, TX

 

-

 

1,840

 

20,152

 

560

 

1,840

 

20,712

 

968

 

2016

 

2016

 

3325 W Plano Parkway

Plattsmouth, NE

 

-

 

250

 

5,650

 

-

 

250

 

5,650

 

1,218

 

2010

 

1999

 

1913 E. Highway 34

Plymouth, MI

 

-

 

1,490

 

19,990

 

330

 

1,490

 

20,320

 

3,862

 

2010

 

1972

 

14707 Northville Rd

Princeton, NJ

 

-

 

1,730

 

30,888

 

1,713

 

1,810

 

32,521

 

5,525

 

2011

 

2001

 

155 Raymond Road

Prior Lake, MN

 

14,033

 

1,870

 

29,849

 

13

 

1,870

 

29,862

 

1,666

 

2015

 

2003

 

4685 Park Nicollet Avenue

Puyallup, WA

 

-

 

1,150

 

20,776

 

445

 

1,156

 

21,216

 

5,246

 

2010

 

1985

 

123 Fourth Ave. NW

Raleigh, NC

 

-

 

7,598

 

88,870

 

-

 

7,598

 

88,870

 

1,959

 

2008

 

2017

 

4030 Cardinal at North Hills St

Raleigh, NC

 

-

 

3,530

 

59,589

 

-

 

3,530

 

59,589

 

8,253

 

2012

 

2002

 

5301 Creedmoor Road

Raleigh, NC

 

-

 

2,580

 

16,837

 

-

 

2,580

 

16,837

 

2,497

 

2012

 

1988

 

7900 Creedmoor Road

Reading, PA

 

-

 

980

 

19,906

 

140

 

980

 

20,046

 

3,736

 

2011

 

1994

 

5501 Perkiomen Ave

Red Bank, NJ

 

-

 

1,050

 

21,275

 

565

 

1,050

 

21,840

 

3,593

 

2011

 

1997

 

One Hartford Dr.

Rehoboth Beach, DE

 

-

 

960

 

24,248

 

8,708

 

977

 

32,938

 

5,180

 

2010

 

1999

 

36101 Seaside Blvd

Reidsville, NC

 

-

 

170

 

3,830

 

857

 

170

 

4,687

 

1,935

 

2002

 

1998

 

2931 Vance St.

Reno, NV

 

-

 

1,060

 

11,440

 

605

 

1,060

 

12,045

 

4,148

 

2004

 

1998

 

5165 Summit Ridge Road

Richmond, IN

 

-

 

700

 

14,222

 

393

 

700

 

14,615

 

813

 

2016

 

2015

 

400 Industries Road

Richmond, VA

 

-

 

-

 

12,000

 

-

 

250

 

11,750

 

1,624

 

2013

 

1989

 

2220 Edward Holland Drive

Ridgeland, MS

 

-

 

520

 

7,675

 

427

 

520

 

8,102

 

2,966

 

2003

 

1997

 

410 Orchard Park

Rochdale, MA

 

-

 

-

 

7,100

 

-

 

690

 

6,410

 

841

 

2013

 

1994

 

111 Huntoon Memorial Highway

Rockville, CT

 

-

 

1,500

 

4,835

 

181

 

1,500

 

5,016

 

1,248

 

2011

 

1960

 

1253 Hartford Turnpike

Rockville Centre, NY

 

-

 

4,290

 

20,310

 

868

 

4,290

 

21,178

 

3,656

 

2011

 

2002

 

260 Maple Ave

Rockwall, TX

 

-

 

2,220

 

17,650

 

-

 

2,220

 

17,650

 

1,131

 

2012

 

2014

 

720 E Ralph Hall Parkway

Rocky Hill, CT

 

-

 

1,090

 

6,710

 

1,500

 

1,090

 

8,210

 

2,889

 

2003

 

1996

 

60 Cold Spring Rd.

Rohnert Park, CA

 

-

 

6,500

 

18,700

 

2,116

 

6,546

 

20,769

 

7,032

 

2005

 

1986

 

4855 Snyder Lane

Romeoville, IL

 

-

 

1,895

 

-

 

-

 

1,895

 

-

 

-

 

2006

 

1900

 

Grand Haven Circle

Roseville, MN

 

-

 

2,140

 

24,679

 

67

 

2,140

 

24,746

 

1,391

 

2015

 

1989

 

2750 North Victoria Street

Roswell, GA

 

-

 

1,107

 

9,627

 

1,086

 

1,114

 

10,706

 

7,942

 

1997

 

1999

 

655 Mansell Rd.

Rugeley, UKG

 

-

 

1,900

 

10,262

 

1,175

 

2,083

 

11,253

 

1,387

 

2013

 

2010

 

Horse Fair

Ruston, LA

 

-

 

710

 

9,790

 

-

 

710

 

9,790

 

1,842

 

2011

 

1988

 

1401 Ezelle St

Sacramento, CA

 

-

 

940

 

14,781

 

251

 

952

 

15,020

 

3,718

 

2010

 

1978

 

6350 Riverside Blvd

Salem, OR

 

-

 

449

 

5,171

 

-

 

449

 

5,172

 

2,585

 

1999

 

1998

 

1355 Boone Rd. S.E.

Salisbury, NC

 

-

 

370

 

5,697

 

168

 

370

 

5,865

 

2,284

 

2003

 

1997

 

2201 Statesville Blvd.

San Angelo, TX

 

-

 

260

 

8,800

 

425

 

260

 

9,225

 

3,122

 

2004

 

1997

 

2695 Valleyview Blvd.

San Angelo, TX

 

-

 

1,050

 

24,689

 

1,052

 

1,050

 

25,741

 

2,358

 

2014

 

1999

 

6101 Grand Court Road

San Antonio, TX

 

-

 

-

 

17,303

 

-

 

-

 

17,303

 

7,106

 

2007

 

2007

 

8902 Floyd Curl Dr.

San Bernardino, CA

 

-

 

3,700

 

14,300

 

687

 

3,700

 

14,987

 

3,490

 

2008

 

1993

 

1760 W. 16th St.

San Diego, CA

 

-

 

-

 

22,003

 

1,845

 

-

 

23,848

 

5,472

 

2008

 

1992

 

555 Washington St.

Sanatoga, PA

 

-

 

980

 

30,695

 

92

 

980

 

30,787

 

5,551

 

2011

 

1993

 

225 Evergreen Road

Sand Springs, OK

 

-

 

910

 

19,654

 

-

 

910

 

19,654

 

2,832

 

2012

 

2002

 

4402 South 129th Avenue West

Sarasota, FL

 

-

 

475

 

3,175

 

-

 

475

 

3,175

 

1,843

 

1996

 

1995

 

8450 McIntosh Rd.

Sarasota, FL

 

-

 

3,360

 

19,140

 

-

 

3,360

 

19,140

 

3,179

 

2011

 

2006

 

6150 Edgelake Drive

Scranton, PA

 

-

 

440

 

17,609

 

-

 

440

 

17,609

 

1,533

 

2014

 

2005

 

2741 Blvd. Ave

Scranton, PA

 

-

 

320

 

12,144

 

-

 

320

 

12,144

 

1,059

 

2014

 

2013

 

2751 Boulevard Ave

Seattle, WA

 

-

 

5,190

 

9,350

 

564

 

5,199

 

9,905

 

3,373

 

2010

 

1962

 

11501 15th Ave NE

Seattle, WA

 

27,180

 

10,670

 

37,291

 

894

 

10,700

 

38,155

 

11,465

 

2010

 

2005

 

805 4th Ave N

Selbyville, DE

 

-

 

750

 

25,912

 

415

 

769

 

26,308

 

4,848

 

2010

 

2008

 

21111 Arrington Dr

Seven Fields, PA

 

-

 

484

 

4,663

 

60

 

484

 

4,722

 

2,364

 

1999

 

1999

 

500 Seven Fields Blvd.

Severna Park, MD

 

-

 

2,120

 

31,273

 

808

 

2,120

 

32,081

 

5,756

 

2011

 

1981

 

24 Truckhouse Road

Shawnee, OK

 

-

 

80

 

1,400

 

-

 

80

 

1,400

 

804

 

1996

 

1995

 

3947 Kickapoo

Shelbyville, KY

 

-

 

630

 

3,870

 

630

 

630

 

4,500

 

1,474

 

2005

 

1965

 

1871 Midland Trail

Sherman, TX

 

-

 

700

 

5,221

 

-

 

700

 

5,221

 

1,555

 

2005

 

2006

 

1011 E. Pecan Grove Rd.

Shrewsbury, NJ

 

-

 

2,120

 

38,116

 

1,080

 

2,128

 

39,188

 

7,156

 

2010

 

2000

 

5 Meridian Way

Silvis, IL

 

-

 

880

 

16,420

 

139

 

880

 

16,559

 

3,247

 

2010

 

2005

 

1900 10th St.

Sittingbourne, UKJ

 

-

 

1,357

 

6,539

 

763

 

1,488

 

7,170

 

573

 

2014

 

1997

 

200 London Road

Smithfield, NC

 

-

 

290

 

5,680

 

-

 

290

 

5,680

 

2,228

 

2003

 

1998

 

830 Berkshire Rd.

Smithfield, NC

 

-

 

360

 

8,216

 

-

 

360

 

8,216

 

715

 

2014

 

1999

 

250 Highway 210 West

Sonoma, CA

 

-

 

1,100

 

18,400

 

1,700

 

1,109

 

20,090

 

6,758

 

2005

 

1988

 

800 Oregon St.

South Bend, IN

 

-

 

670

 

17,770

 

-

 

670

 

17,770

 

1,604

 

2014

 

2014

 

52565 State Road 933

South Boston, MA

 

-

 

385

 

2,002

 

5,218

 

385

 

7,220

 

3,652

 

1995

 

1961

 

804 E. Seventh St.

Southampton, UKJ

 

-

 

1,612

 

16,803

 

-

 

1,612

 

16,803

 

114

 

2017

 

2013

 

Botley Road, Park Gate

Southbury, CT

 

-

 

1,860

 

23,613

 

958

 

1,860

 

24,571

 

4,300

 

2011

 

2001

 

655 Main St

Springfield, IL

 

-

 

-

 

10,100

 

-

 

768

 

9,332

 

1,682

 

2013

 

2010

 

701 North Walnut Street

Springfield, IL

 

-

 

990

 

13,378

 

1,084

 

990

 

14,462

 

1,292

 

2014

 

2013

 

3089 Old Jacksonville Road

St. Louis, MO

 

-

 

1,890

 

12,390

 

-

 

1,890

 

12,390

 

2,354

 

2010

 

1963

 

6543 Chippewa St

St. Paul, MN

 

-

 

2,100

 

33,019

 

78

 

2,100

 

33,097

 

1,843

 

2015

 

1996

 

750 Mississippi River

Stafford, UKG

 

-

 

2,131

 

8,739

 

-

 

2,131

 

8,739

 

294

 

2014

 

2016

 

Stone Road

Stamford, UKF

 

-

 

1,820

 

3,238

 

489

 

1,996

 

3,551

 

303

 

2014

 

1998

 

Priory Road

Statesville, NC

 

-

 

150

 

1,447

 

266

 

150

 

1,713

 

710

 

2003

 

1990

 

2441 E. Broad St.

Statesville, NC

 

-

 

310

 

6,183

 

8

 

310

 

6,191

 

2,365

 

2003

 

1996

 

2806 Peachtree Place

Statesville, NC

 

-

 

140

 

3,627

 

-

 

140

 

3,627

 

1,416

 

2003

 

1999

 

2814 Peachtree Rd.

Stillwater, OK

 

-

 

80

 

1,400

 

-

 

80

 

1,400

 

806

 

1995

 

1995

 

1616 McElroy Rd.

Stockton, CA

 

-

 

2,280

 

5,983

 

397

 

2,372

 

6,288

 

1,821

 

2010

 

1988

 

6725 Inglewood

Stratford-upon-Avon, UKG

 

-

 

790

 

14,508

 

1,478

 

866

 

15,910

 

1,123

 

2015

 

2012

 

Scholars Lane

Stroudsburg, PA

 

-

 

340

 

16,313

 

-

 

340

 

16,313

 

1,573

 

2014

 

2011

 

370 Whitestone Corner Road

Summit, NJ

 

-

 

3,080

 

14,152

 

-

 

3,080

 

14,152

 

2,633

 

2011

 

2001

 

41 Springfield Avenue

Sunninghill, UKJ

 

-

 

12,338

 

44,799

 

-

 

12,338

 

44,799

 

600

 

2014

 

2017

 

Bagshot Road

Superior, WI

 

-

 

1,020

 

13,735

 

6,159

 

1,020

 

19,894

 

2,361

 

2009

 

2010

 

1915 North 34th Street

Swanton, OH

 

-

 

330

 

6,370

 

-

 

330

 

6,370

 

2,392

 

2004

 

1950

 

401 W. Airport Hwy.

Terre Haute, IN

 

-

 

1,370

 

18,016

 

-

 

1,370

 

18,016

 

1,408

 

2015

 

2015

 

395 8th Avenue

Texarkana, TX

 

-

 

192

 

1,403

 

-

 

192

 

1,403

 

781

 

1996

 

1996

 

4204 Moores Lane

The Villages, FL

 

-

 

1,035

 

7,446

 

-

 

1,035

 

7,446

 

878

 

2013

 

2014

 

2450 Parr Drive

Thomasville, GA

 

-

 

530

 

12,520

 

-

 

530

 

12,520

 

1,757

 

2011

 

2006

 

423 Covington Avenue

Tomball, TX

 

-

 

1,050

 

13,300

 

840

 

1,050

 

14,140

 

2,438

 

2011

 

2001

 

1221 Graham Dr

Toms River, NJ

 

-

 

1,610

 

34,627

 

865

 

1,679

 

35,423

 

6,545

 

2010

 

2005

 

1587 Old Freehold Rd

Tonganoxie, KS

 

-

 

310

 

3,690

 

72

 

310

 

3,762

 

234

 

2015

 

2009

 

120 W 8th St

Topeka, KS

 

-

 

260

 

12,712

 

-

 

260

 

12,712

 

1,892

 

2012

 

2011

 

1931 Southwest Arvonia Place

Towson, MD

 

-

 

1,180

 

13,280

 

195

 

1,180

 

13,475

 

2,589

 

2011

 

1973

 

7700 York Road

Troy, OH

 

-

 

200

 

2,000

 

4,254

 

200

 

6,254

 

2,009

 

1997

 

1997

 

81 S. Stanfield Rd.

Troy, OH

 

-

 

470

 

16,730

 

-

 

470

 

16,730

 

6,074

 

2004

 

1971

 

512 Crescent Drive

Trumbull, CT

 

-

 

4,440

 

43,384

 

-

 

4,440

 

43,384

 

7,703

 

2011

 

2001

 

6949 Main Street

Tulsa, OK

 

-

 

3,003

 

6,025

 

20

 

3,003

 

6,045

 

3,432

 

2006

 

1992

 

3219 S. 79th E. Ave.

Tulsa, OK

 

-

 

1,390

 

7,110

 

1,102

 

1,390

 

8,212

 

1,708

 

2010

 

1998

 

7220 S. Yale Ave.

Tulsa, OK

 

-

 

1,320

 

10,087

 

-

 

1,320

 

10,087

 

1,529

 

2011

 

2012

 

7902 South Mingo Road East

Tulsa, OK

 

-

 

1,100

 

27,007

 

-

 

1,100

 

27,007

 

597

 

2015

 

2017

 

18001 East 51st Street

Tulsa, OK

 

13,000

 

1,752

 

28,421

 

-

 

1,752

 

28,421

 

407

 

2017

 

2014

 

701 W 71st Street South

Tulsa, OK

 

-

 

890

 

9,410

 

-

 

890

 

9,410

 

44

 

2017

 

2009

 

7210 South Yale Avenue

Tyler, TX

 

-

 

650

 

5,268

 

-

 

650

 

5,268

 

1,509

 

2006

 

2007

 

5550 Old Jacksonville Hwy.

Upper Providence, PA

 

-

 

1,900

 

28,195

 

-

 

1,900

 

28,195

 

1,968

 

2013

 

2015

 

1133 Black Rock Road

Vacaville, CA

 

-

 

900

 

17,100

 

1,651

 

900

 

18,751

 

6,462

 

2005

 

1987

 

799 Yellowstone Dr.

Vallejo, CA

 

-

 

4,000

 

18,000

 

2,344

 

4,030

 

20,315

 

6,950

 

2005

 

1989

 

350 Locust Dr.

Vallejo, CA

 

-

 

2,330

 

15,407

 

310

 

2,330

 

15,717

 

4,110

 

2010

 

1990

 

2261 Tuolumne

Valparaiso, IN

 

-

 

112

 

2,558

 

-

 

112

 

2,558

 

1,146

 

2001

 

1998

 

2601 Valparaiso St.

Valparaiso, IN

 

-

 

108

 

2,962

 

-

 

108

 

2,962

 

1,309

 

2001

 

1999

 

2501 Valparaiso St.

Vancouver, WA

 

-

 

1,820

 

19,042

 

270

 

1,821

 

19,311

 

4,822

 

2010

 

2006

 

10011 NE 118th Ave

Venice, FL

 

-

 

1,150

 

10,674

 

-

 

1,150

 

10,674

 

2,415

 

2008

 

2009

 

1600 Center Rd.

Vero Beach, FL

 

-

 

263

 

3,187

 

-

 

263

 

3,187

 

1,398

 

2001

 

1999

 

420 4th Ct.

Vero Beach, FL

 

-

 

297

 

3,263

 

-

 

297

 

3,263

 

1,441

 

2001

 

1996

 

410 4th Ct.

Virginia Beach, VA

 

-

 

1,540

 

22,593

 

-

 

1,540

 

22,593

 

1,996

 

2014

 

1993

 

5520 Indian River Rd

Voorhees, NJ

 

-

 

1,800

 

37,299

 

671

 

1,800

 

37,970

 

7,042

 

2011

 

1965

 

2601 Evesham Road

Voorhees, NJ

 

-

 

1,900

 

26,040

 

894

 

1,900

 

26,934

 

5,017

 

2011

 

1985

 

3001 Evesham Road

Voorhees, NJ

 

-

 

3,100

 

25,950

 

26

 

3,100

 

25,976

 

3,724

 

2011

 

2013

 

113 South Route 73

Voorhees, NJ

 

-

 

3,700

 

24,312

 

1,631

 

3,847

 

25,796

 

3,228

 

2012

 

2013

 

311 Route 73

Wabash, IN

 

-

 

670

 

14,588

 

-

 

670

 

14,588

 

1,381

 

2014

 

2013

 

20 John Kissinger Drive

Waconia, MN

 

-

 

890

 

14,726

 

4,495

 

890

 

19,221

 

3,073

 

2011

 

2005

 

500 Cherry Street

Wake Forest, NC

 

-

 

200

 

3,003

 

1,742

 

200

 

4,745

 

2,197

 

1998

 

1999

 

611 S. Brooks St.

Wall, NJ

 

-

 

1,650

 

25,350

 

2,499

 

1,692

 

27,807

 

4,554

 

2011

 

2003

 

2021 Highway 35

Walsall, UKG

 

-

 

1,184

 

8,562

 

942

 

1,299

 

9,389

 

702

 

2015

 

2015

 

Little Aston Road

Wamego, KS

 

-

 

40

 

2,510

 

55

 

40

 

2,565

 

149

 

2015

 

1996

 

1607 4th St

Wareham, MA

 

-

 

875

 

10,313

 

1,701

 

875

 

12,014

 

5,255

 

2002

 

1989

 

50 Indian Neck Rd.

Warren, NJ

 

-

 

2,000

 

30,810

 

1,014

 

2,000

 

31,824

 

5,165

 

2011

 

1999

 

274 King George Rd

Watchung, NJ

 

-

 

1,920

 

24,880

 

1,138

 

1,991

 

25,947

 

4,363

 

2011

 

2000

 

680 Mountain Boulevard

Waukee, IA

 

-

 

1,870

 

31,878

 

1,075

 

1,870

 

32,953

 

4,544

 

2012

 

2007

 

1650 SE Holiday Crest Circle

Waxahachie, TX

 

-

 

650

 

5,763

 

-

 

650

 

5,763

 

1,521

 

2007

 

2008

 

1329 Brown St.

Weatherford, TX

 

-

 

660

 

5,261

 

-

 

660

 

5,261

 

1,519

 

2006

 

2007

 

1818 Martin Drive

Wellingborough, UKF

 

-

 

1,480

 

5,724

 

696

 

1,623

 

6,277

 

538

 

2015

 

2015

 

159 Northampton

West Bend, WI

 

-

 

620

 

17,790

 

38

 

620

 

17,828

 

2,837

 

2010

 

2011

 

2130 Continental Dr

West Chester, PA

 

-

 

1,350

 

29,237

 

260

 

1,350

 

29,497

 

5,462

 

2011

 

1974

 

800 West Miner Street

West Orange, NJ

 

-

 

2,280

 

10,687

 

187

 

2,280

 

10,874

 

2,249

 

2011

 

1963

 

20 Summit Street

Westerville, OH

 

-

 

740

 

8,287

 

3,105

 

740

 

11,392

 

9,171

 

1998

 

2001

 

690 Cooper Rd.

Westfield, IN

 

-

 

890

 

15,964

 

-

 

890

 

15,964

 

1,499

 

2014

 

2013

 

937 E. 186th Street

Westfield, NJ

 

-

 

2,270

 

16,589

 

497

 

2,270

 

17,086

 

3,481

 

2011

 

1970

 

1515 Lamberts Mill Road

Weston Super Mare, UKK

 

-

 

2,517

 

7,054

 

925

 

2,760

 

7,736

 

905

 

2013

 

2011

 

141b Milton Road

White Lake, MI

 

-

 

2,920

 

20,179

 

92

 

2,920

 

20,271

 

3,951

 

2010

 

2000

 

935 Union Lake Rd

Wichita, KS

 

-

 

1,400

 

11,000

 

-

 

1,400

 

11,000

 

4,399

 

2006

 

1997

 

505 North Maize Road

Wichita, KS

 

-

 

860

 

8,873

 

-

 

860

 

8,873

 

1,527

 

2011

 

2012

 

10604 E 13th Street North

Wichita, KS

 

13,001

 

627

 

19,748

 

-

 

629

 

19,752

 

2,810

 

2012

 

2009

 

2050 North Webb Road

Wichita, KS

 

-

 

260

 

2,240

 

114

 

260

 

2,354

 

137

 

2015

 

1992

 

900 N Bayshore Dr

Wichita, KS

 

-

 

900

 

10,134

 

-

 

900

 

10,134

 

1,646

 

2011

 

2012

 

10600 E 13th Street North

Williamstown, KY

 

-

 

70

 

6,430

 

-

 

70

 

6,430

 

2,352

 

2005

 

1987

 

201 Kimberly Lane

Wilmington, DE

 

-

 

800

 

9,494

 

114

 

800

 

9,608

 

1,906

 

2011

 

1970

 

810 S Broom Street

Wilmington, NC

 

-

 

210

 

2,991

 

-

 

210

 

2,991

 

1,489

 

1999

 

1999

 

3501 Converse Dr.

Wilmington, NC

 

-

 

400

 

15,356

 

-

 

400

 

15,356

 

1,401

 

2014

 

2012

 

3828 Independence Blvd

Windsor, CT

 

-

 

2,250

 

8,539

 

1,855

 

2,250

 

10,394

 

2,104

 

2011

 

1969

 

One Emerson Drive

Windsor, CT

 

-

 

1,800

 

600

 

970

 

1,800

 

1,570

 

470

 

2011

 

1974

 

One Emerson Drive

Winston-Salem, NC

 

-

 

360

 

2,514

 

459

 

360

 

2,973

 

1,199

 

2003

 

1996

 

2980 Reynolda Rd.

Winter Garden, FL

 

-

 

1,110

 

7,937

 

-

 

1,110

 

7,937

 

1,145

 

2012

 

2013

 

720 Roper Road

Witherwack, UKC

 

-

 

944

 

6,915

 

759

 

1,035

 

7,583

 

888

 

2013

 

2009

 

Whitchurch Road

Wolverhampton, UKG

 

-

 

1,573

 

6,678

 

797

 

1,725

 

7,323

 

865

 

2013

 

2011

 

378 Prestonwood Road

Woodbury, MN

 

-

 

1,317

 

20,935

 

-

 

1,317

 

20,935

 

454

 

2017

 

2015

 

2195 Century Avenue South

Worcester, MA

 

-

 

3,500

 

54,099

 

-

 

3,500

 

54,099

 

11,586

 

2007

 

2009

 

101 Barry Road

Worcester, MA

 

-

 

2,300

 

9,060

 

6,000

 

2,300

 

15,060

 

3,152

 

2008

 

1993

 

378 Plantation St.

Wyncote, PA

 

-

 

2,700

 

22,244

 

274

 

2,700

 

22,518

 

4,282

 

2011

 

1960

 

1245 Church Road

York, UKE

 

-

 

2,961

 

8,266

 

1,085

 

3,247

 

9,064

 

758

 

2014

 

2006

 

Rosetta Way, Boroughbridge Road

Youngsville, NC

 

-

 

380

 

10,689

 

-

 

380

 

10,689

 

950

 

2014

 

2013

 

100 Sunset Drive

Zionsville, IN

$

-

$

1,610

$

22,400

$

1,691

$

1,610

$

24,091

$

4,523

 

2010

 

2009

 

11755 N Michigan Rd

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Triple-net total

$

343,361

$

818,863

$

7,759,508

$

382,344

$

847,780

$

8,112,937

$

1,380,023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

97


  

 

  

98


  

Welltower Inc.

 

 

Schedule III

 

 

Real Estate and Accumulated Depreciation

 

 

December 31, 2017

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

Initial Cost to Company

 

 

 

Gross Amount at Which Carried at Close of Period

 

 

 

 

 

 

Description

 

 

Encumbrances

 

Land

 

Building & Improvements

 

Cost Capitalized Subsequent to Acquisition

 

Land

 

Building & Improvements

 

Accumulated Depreciation(1)

 

Year Acquired

 

Year Built

 

Address

Seniors housing operating:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acton, MA

 

$

-

$

-

$

31,346

$

1,484

$

14

$

32,816

$

5,154

 

2013

 

2000

 

10 Devon Drive

Adderbury, UKJ

 

 

-

 

2,274

 

13,222

 

-

 

2,274

 

13,222

 

280

 

2015

 

2017

 

Banbury Road

Agawam, MA

 

 

-

 

880

 

10,044

 

671

 

959

 

10,636

 

2,802

 

2011

 

1996

 

153 Cardinal Drive

Albuquerque, NM

 

 

-

 

1,270

 

20,837

 

1,824

 

1,276

 

22,655

 

5,732

 

2010

 

1984

 

500 Paisano St NE

Alhambra, CA

 

 

-

 

600

 

6,305

 

9,025

 

600

 

15,330

 

1,776

 

2011

 

1923

 

1118 N. Stoneman Ave.

Altrincham, UKD

 

 

-

 

4,244

 

25,187

 

3,246

 

4,654

 

28,023

 

5,255

 

2012

 

2009

 

295 Hale Road

Amherstview, ON

 

 

583

 

473

 

4,446

 

770

 

537

 

5,152

 

717

 

2015

 

1974

 

4567 Bath Road

Arlington, VA

 

 

-

 

8,385

 

31,198

 

15,714

 

8,385

 

46,912

 

-

 

2017

 

1992

 

900 N Taylor Street

Arlington, TX

 

 

20,668

 

1,660

 

37,395

 

3,110

 

1,709

 

40,456

 

9,983

 

2012

 

2000

 

1250 West Pioneer Parkway

Arnprior, ON

 

 

303

 

788

 

6,283

 

961

 

880

 

7,152

 

1,435

 

2013

 

1991

 

15 Arthur Street

Atlanta, GA

 

 

-

 

2,100

 

20,603

 

1,167

 

2,154

 

21,717

 

3,478

 

2014

 

2000

 

1000 Lenox Park Blvd NE

Austin, TX

 

 

-

 

1,560

 

21,413

 

185

 

1,560

 

21,598

 

2,408

 

2014

 

2013

 

11330 Farrah Lane

Austin, TX

 

 

-

 

4,200

 

74,850

 

510

 

4,200

 

75,361

 

6,004

 

2015

 

2014

 

4310 Bee Caves Road

Avon, CT

 

 

-

 

1,550

 

30,571

 

3,806

 

1,588

 

34,339

 

9,420

 

2011

 

1998

 

101 Bickford Extension

Azusa, CA

 

 

-

 

570

 

3,141

 

7,769

 

570

 

10,910

 

3,003

 

1998

 

1953

 

125 W. Sierra Madre Ave.

Bagshot, UKJ

 

 

-

 

4,960

 

29,881

 

3,750

 

5,445

 

33,146

 

6,692

 

2012

 

2009

 

14 - 16 London Road

Banstead, UKJ

 

 

-

 

6,695

 

55,113

 

7,232

 

7,342

 

61,698

 

10,975

 

2012

 

2005

 

Croydon Lane

Basingstoke, UKJ

 

 

-

 

3,420

 

18,853

 

2,220

 

3,750

 

20,742

 

2,112

 

2014

 

2012

 

Grove Road

Basking Ridge, NJ

 

 

-

 

2,356

 

37,710

 

1,359

 

2,395

 

39,031

 

6,952

 

2013

 

2002

 

404 King George Road

Bassett, UKJ

 

 

-

 

4,874

 

32,304

 

5,617

 

5,358

 

37,436

 

7,099

 

2013

 

2006

 

111 Burgess Road

Bath, UKK

 

 

-

 

2,855

 

12,485

 

-

 

2,855

 

12,485

 

237

 

2015

 

2017

 

Clarks Way, Rush Hill

Baton Rouge, LA

 

 

9,017

 

790

 

29,436

 

612

 

842

 

29,996

 

5,264

 

2013

 

2009

 

9351 Siegen Lane

Beaconsfield, UKJ

 

 

-

 

5,566

 

50,952

 

5,591

 

6,115

 

55,993

 

9,757

 

2013

 

2009

 

30-34 Station Road

Beaconsfield, QC

 

 

-

 

1,149

 

17,484

 

2,304

 

1,335

 

19,602

 

4,833

 

2013

 

2008

 

505 Elm Avenue

Bedford, NH

 

 

-

 

2,527

 

28,748

 

2,105

 

2,548

 

30,832

 

4,927

 

2011

 

2012

 

5 Corporate Drive

Bee Cave, TX

 

 

-

 

1,820

 

21,084

 

708

 

1,820

 

21,792

 

1,755

 

2016

 

2014

 

14058 A Bee Cave Parkway

Bellevue, WA

 

 

-

 

2,800

 

19,004

 

2,072

 

2,816

 

21,060

 

4,586

 

2013

 

1998

 

15928 NE 8th Street

Belmont, CA

 

 

-

 

3,000

 

23,526

 

2,254

 

3,000

 

25,780

 

6,244

 

2011

 

1971

 

1301 Ralston Avenue

Belmont, CA

 

 

-

 

-

 

35,300

 

1,837

 

37

 

37,100

 

6,940

 

2013

 

2002

 

1010 Alameda de Las Pulgas

Berkeley, CA

 

 

12,433

 

3,050

 

32,677

 

3,757

 

3,050

 

36,434

 

3,323

 

2016

 

1966

 

2235 Sacramento Street

Bethesda, MD

 

 

-

 

-

 

45,309

 

593

 

3

 

45,900

 

8,359

 

2013

 

2009

 

8300 Burdett Road

Bethesda, MD

 

 

-

 

-

 

45

 

489

 

-

 

534

 

67

 

2013

 

2009

 

8300 Burdett Road

Bethesda, MD

 

 

-

 

-

 

212

 

871

 

-

 

1,083

 

128

 

2013

 

2009

 

8300 Burdett Road

Billerica, MA

 

 

-

 

1,619

 

21,381

 

753

 

1,624

 

22,130

 

2,501

 

2015

 

2000

 

20 Charnstaffe Lane

Birmingham, UKG

 

 

-

 

4

 

21,321

 

2,252

 

30

 

23,547

 

4,629

 

2013

 

2006

 

5 Church Road, Edgbaston

Birmingham, UKG

 

 

-

 

1,480

 

13,014

 

1,500

 

1,623

 

14,371

 

423

 

2015

 

2016

 

47 Bristol Road South

Birmingham, UKG

 

 

-

 

2,807

 

11,313

 

1,449

 

3,078

 

12,491

 

335

 

2015

 

2016

 

134 Jockey Road

Blainville, QC

 

 

-

 

2,077

 

8,902

 

1,398

 

2,306

 

10,071

 

2,907

 

2013

 

2008

 

50 des Chateaux Boulevard

Bloomfield Hills, MI

 

 

-

 

2,000

 

35,662

 

767

 

2,008

 

36,421

 

6,477

 

2013

 

2009

 

6790 Telegraph Road

Borehamwood, UKH

 

 

-

 

5,367

 

41,937

 

5,041

 

5,900

 

46,445

 

8,293

 

2012

 

2003

 

Edgwarebury Lane

Bothell, WA

 

 

-

 

1,350

 

13,439

 

4,808

 

1,361

 

18,237

 

1,626

 

2015

 

1988

 

10605 NE 185th Street

Boulder, CO

 

 

-

 

2,994

 

27,458

 

2,065

 

3,022

 

29,495

 

6,557

 

2013

 

2003

 

3955 28th Street

Bournemouth, UKK

 

 

-

 

5,527

 

42,547

 

5,311

 

6,061

 

47,324

 

6,943

 

2013

 

2008

 

42 Belle Vue Road

Braintree, MA

 

 

-

 

-

 

41,290

 

862

 

56

 

42,097

 

7,828

 

2013

 

2007

 

618 Granite Street

Brampton, ON

 

 

45,677

 

10,256

 

60,021

 

5,524

 

11,107

 

64,694

 

8,646

 

2015

 

2009

 

100 Ken Whillans Drive

Brighton, MA

 

 

9,911

 

2,100

 

14,616

 

1,391

 

2,109

 

15,998

 

4,149

 

2011

 

1995

 

50 Sutherland Road 

Brockport, NY

 

 

-

 

1,500

 

23,496

 

503

 

1,705

 

23,794

 

3,164

 

2015

 

1999

 

90 West Avenue

Brockville, ON

 

 

4,808

 

484

 

7,445

 

1,040

 

543

 

8,426

 

1,034

 

2015

 

1996

 

1026 Bridlewood Drive

Brookfield, CT

 

 

-

 

2,250

 

30,180

 

2,422

 

2,262

 

32,590

 

8,207

 

2011

 

1999

 

246A Federal Road 

Broomfield, CO

 

 

-

 

4,140

 

44,547

 

11,669

 

10,135

 

50,221

 

14,474

 

2013

 

2009

 

400 Summit Blvd

Brossard, QC

 

 

11,807

 

5,499

 

31,854

 

3,168

 

5,912

 

34,609

 

4,674

 

2015

 

1989

 

2455 Boulevard Rome

Buckingham, UKJ

 

 

-

 

2,979

 

13,880

 

1,764

 

3,267

 

15,356

 

2,047

 

2014

 

1883

 

Church Street

Buffalo Grove, IL

 

 

-

 

2,850

 

49,129

 

1,272

 

2,850

 

50,401

 

9,134

 

2012

 

2003

 

500 McHenry Road

Burbank, CA

 

 

-

 

4,940

 

43,466

 

1,324

 

4,940

 

44,790

 

9,465

 

2012

 

2002

 

455 E. Angeleno Avenue

Burbank, CA

 

 

19,593

 

3,610

 

50,817

 

3,284

 

3,610

 

54,101

 

4,187

 

2016

 

1985

 

2721 Willow Street

Burleson, TX

 

 

-

 

3,150

 

10,437

 

626

 

3,150

 

11,063

 

1,049

 

2012

 

2014

 

621 Old Highway 1187

Burlingame, CA

 

 

-

 

-

 

62,786

 

-

 

-

 

62,786

 

980

 

2016

 

2015

 

1818 Trousdale Avenue

Burlington, ON

 

 

13,151

 

1,309

 

19,311

 

2,496

 

1,453

 

21,663

 

4,163

 

2013

 

1990

 

500 Appleby Line

Burlington, MA

 

 

-

 

2,443

 

34,354

 

1,350

 

2,522

 

35,626

 

6,963

 

2013

 

2005

 

24 Mall Road

Burlington, MA

 

 

-

 

2,750

 

57,488

 

3,167

 

2,750

 

60,655

 

3,673

 

2016

 

2011

 

50 Greenleaf Way

Calabasas, CA

 

 

-

 

-

 

6,438

 

977

 

-

 

7,415

 

5,256

 

2013

 

1972

 

25100 Calabasas Road

Calgary, AB

 

 

12,898

 

2,252

 

37,415

 

4,862

 

2,492

 

42,036

 

8,321

 

2013

 

2003

 

20 Promenade Way SE

Calgary, AB

 

 

14,751

 

2,793

 

41,179

 

4,956

 

3,098

 

45,831

 

8,857

 

2013

 

1998

 

80 Edenwold Drive NW

Calgary, AB

 

 

11,678

 

3,122

 

38,971

 

4,817

 

3,464

 

43,446

 

8,314

 

2013

 

1998

 

150 Scotia Landing NW

Calgary, AB

 

 

23,927

 

3,431

 

28,983

 

4,572

 

3,810

 

33,176

 

5,378

 

2013

 

1989

 

9229 16th Street SW

Calgary, AB

 

 

26,364

 

2,385

 

36,776

 

4,457

 

2,642

 

40,978

 

5,167

 

2015

 

2006

 

2220-162nd Avenue SW

Camberley, UKJ

 

 

-

 

2,654

 

5,736

 

19,242

 

7,914

 

19,717

 

624

 

2014

 

2016

 

Fernhill Road

Camberley, UKJ

 

 

-

 

731

 

3,164

 

-

 

731

 

3,164

 

24

 

2014

 

2017

 

Fernhill Road

Cardiff, UKL

 

 

-

 

3,191

 

12,566

 

1,786

 

3,499

 

14,043

 

3,315

 

2013

 

2007

 

127 Cyncoed Road

Cardiff by the Sea, CA

 

 

37,915

 

5,880

 

64,711

 

1,925

 

5,880

 

66,636

 

14,057

 

2011

 

2009

 

3535 Manchester Avenue

Carol Stream, IL

 

 

-

 

1,730

 

55,048

 

1,723

 

1,730

 

56,771

 

11,184

 

2012

 

2001

 

545 Belmont Lane

Carrollton, TX

 

 

-

 

4,280

 

31,444

 

941

 

4,280

 

32,385

 

3,353

 

2013

 

2010

 

2105 North Josey Lane

Cary, NC

 

 

-

 

740

 

45,240

 

635

 

740

 

45,875

 

7,154

 

2013

 

2009

 

1206 West Chatham Street

Cedar Park, TX

 

 

-

 

1,750

 

15,664

 

759

 

1,750

 

16,422

 

649

 

2016

 

2015

 

800 C-Bar Ranch Trail

Centerville, MA

 

 

-

 

1,300

 

27,357

 

1,113

 

1,324

 

28,446

 

6,327

 

2011

 

1998

 

22 Richardson Road

Cerritos, CA

 

 

-

 

-

 

27,494

 

5,633

 

-

 

33,127

 

3,641

 

2016

 

2002

 

11000 New Falcon Way

Chatham, ON

 

 

1,253

 

1,098

 

12,462

 

2,960

 

1,290

 

15,230

 

2,947

 

2015

 

1965

 

25 Keil Drive North

Chelmsford, MA

 

 

-

 

1,589

 

26,432

 

1,214

 

1,651

 

27,585

 

2,988

 

2015

 

1997

 

199 Chelmsford Street

Chertsey, UKJ

 

 

-

 

-

 

105

 

-

 

-

 

105

 

-

 

2015

 

1900

 

Bittams Lane

Chesterfield, MO

 

 

-

 

1,857

 

48,366

 

1,299

 

1,917

 

49,605

 

8,273

 

2013

 

2001

 

1880 Clarkson Road

Chorleywood, UKH

 

 

-

 

5,636

 

43,191

 

6,324

 

6,184

 

48,967

 

8,985

 

2013

 

2007

 

High View, Rickmansworth Road

Chula Vista, CA

 

 

-

 

2,072

 

22,163

 

863

 

2,128

 

22,970

 

4,259

 

2013

 

2003

 

3302 Bonita Road

Church Crookham, UKJ

 

 

-

 

2,591

 

14,215

 

1,832

 

2,855

 

15,783

 

2,283

 

2014

 

2014

 

Bourley Road

Cincinnati, OH

 

 

-

 

2,060

 

109,388

 

13,115

 

2,078

 

122,485

 

22,924

 

2007

 

2010

 

5445 Kenwood Road

Claremont, CA

 

 

-

 

2,430

 

9,928

 

1,375

 

2,483

 

11,249

 

2,373

 

2013

 

2001

 

2053 North Towne Avenue

Cohasset, MA

 

 

-

 

2,485

 

26,147

 

1,758

 

2,487

 

27,903

 

5,172

 

2013

 

1998

 

125 King Street (Rt 3A)

Colleyville, TX

 

 

-

 

1,050

 

17,082

 

40

 

1,050

 

17,122

 

459

 

2016

 

2013

 

8100 Precinct Line Road

Colorado Springs, CO

 

 

-

 

800

 

14,756

 

1,801

 

1,017

 

16,341

 

3,010

 

2013

 

2001

 

2105 University Park Boulevard

Concord, NH

 

 

-

 

720

 

21,164

 

789

 

779

 

21,893

 

4,812

 

2011

 

2001

 

300 Pleasant Street 

Coquitlam, BC

 

 

10,477

 

3,047

 

24,567

 

3,268

 

3,375

 

27,507

 

6,467

 

2013

 

1990

 

1142 Dufferin Street

Costa Mesa, CA

 

 

-

 

2,050

 

19,969

 

1,320

 

2,050

 

21,289

 

5,139

 

2011

 

1965

 

350 West Bay St

Crystal Lake, IL

 

 

-

 

875

 

12,461

 

1,259

 

893

 

13,701

 

3,023

 

2013

 

2001

 

751 E Terra Cotta Avenue

Dallas, TX

 

 

-

 

6,330

 

114,794

 

1,199

 

6,330

 

115,993

 

10,306

 

2015

 

2013

 

3535 N Hall Street

Danvers, MA

 

 

-

 

1,120

 

14,557

 

1,045

 

1,145

 

15,576

 

3,873

 

2011

 

2000

 

1 Veronica Drive

Danvers, MA

 

 

-

 

2,203

 

28,761

 

276

 

2,257

 

28,983

 

3,667

 

2015

 

1997

 

9 Summer Street

Davenport, IA

 

 

-

 

1,403

 

35,893

 

3,632

 

1,480

 

39,448

 

9,192

 

2006

 

2009

 

4500 Elmore Ave.

Decatur, GA

 

 

-

 

1,946

 

26,575

 

2,080

 

1,946

 

28,656

 

5,798

 

2013

 

1998

 

920 Clairemont Avenue

Denver, CO

 

 

12,033

 

1,450

 

19,389

 

3,119

 

1,470

 

22,489

 

4,114

 

2012

 

1997

 

4901 South Monaco Street

Denver, CO

 

 

-

 

2,910

 

35,838

 

1,459

 

2,962

 

37,246

 

8,399

 

2012

 

2007

 

8101 E Mississippi Avenue

Dix Hills, NY

 

 

-

 

3,808

 

39,014

 

1,430

 

3,824

 

40,428

 

7,473

 

2013

 

2003

 

337 Deer Park Road

Dollard-Des-Ormeaux, QC

 

 

-

 

1,957

 

14,431

 

1,982

 

2,222

 

16,149

 

4,757

 

2013

 

2008

 

4377 St. Jean Blvd

Dresher, PA

 

 

6,966

 

1,900

 

10,664

 

896

 

1,914

 

11,547

 

3,259

 

2013

 

2006

 

1650 Susquehanna Road

Dublin, OH

 

 

-

 

1,680

 

43,423

 

6,429

 

1,847

 

49,685

 

12,524

 

2010

 

1990

 

6470 Post Rd

Dublin, OH

 

 

-

 

1,169

 

25,345

 

-

 

1,169

 

25,345

 

452

 

2016

 

2015

 

4175 Stoneridge Lane

East Haven, CT

 

 

-

 

2,660

 

35,533

 

3,109

 

2,681

 

38,621

 

11,385

 

2011

 

2000

 

111 South Shore Drive 

East Meadow, NY

 

 

-

 

69

 

45,991

 

1,360

 

124

 

47,296

 

8,545

 

2013

 

2002

 

1555 Glen Curtiss Boulevard

East Setauket, NY

 

 

-

 

4,920

 

37,354

 

1,349

 

4,975

 

38,648

 

7,038

 

2013

 

2002

 

1 Sunrise Drive

Eastbourne, UKJ

 

 

-

 

4,145

 

33,744

 

3,892

 

4,557

 

37,224

 

7,009

 

2013

 

2008

 

6 Upper Kings Drive

Edgbaston, UKG

 

 

-

 

2,720

 

13,969

 

1,680

 

2,983

 

15,386

 

1,130

 

2014

 

2015

 

Pershore Road

Edgewater, NJ

 

 

-

 

4,561

 

25,047

 

1,349

 

4,564

 

26,393

 

5,108

 

2013

 

2000

 

351 River Road

Edison, NJ

 

 

-

 

1,892

 

32,314

 

1,463

 

1,905

 

33,764

 

8,522

 

2013

 

1996

 

1801 Oak Tree Road

Edmonds, WA

 

 

-

 

1,650

 

24,449

 

2,665

 

1,651

 

27,113

 

2,679

 

2015

 

1976

 

21500 72nd Avenue West

Edmonton, AB

 

 

9,439

 

1,589

 

29,819

 

3,890

 

1,778

 

33,520

 

6,718

 

2013

 

1999

 

103 Rabbit Hill Court NW

Edmonton, AB

 

 

12,242

 

2,063

 

37,293

 

4,948

 

2,281

 

42,023

 

10,604

 

2013

 

1968

 

10015 103rd Avenue NW

Encinitas, CA

 

 

-

 

1,460

 

7,721

 

2,946

 

1,460

 

10,667

 

4,504

 

2000

 

1988

 

335 Saxony Rd.

Encino, CA

 

 

-

 

5,040

 

46,255

 

1,930

 

5,040

 

48,185

 

9,720

 

2012

 

2003

 

15451 Ventura Boulevard

Escondido, CA

 

 

-

 

1,520

 

24,024

 

1,358

 

1,520

 

25,382

 

6,200

 

2011

 

1987

 

1500 Borden Rd

Esher, UKJ

 

 

-

 

5,783

 

48,361

 

5,320

 

6,346

 

53,118

 

9,005

 

2013

 

2006

 

42 Copsem Lane

Fairfax, VA

 

 

-

 

19

 

2,678

 

239

 

53

 

2,883

 

822

 

2013

 

1991

 

9207 Arlington Boulevard

Fairfield, NJ

 

 

-

 

3,120

 

43,868

 

1,125

 

3,175

 

44,937

 

8,407

 

2013

 

1998

 

47 Greenbrook Road

Fareham, UKJ

 

 

-

 

3,408

 

17,970

 

2,324

 

3,743

 

19,960

 

2,442

 

2014

 

2012

 

Redlands Lane

Flossmoor, IL

 

 

-

 

1,292

 

9,496

 

1,633

 

1,339

 

11,082

 

2,631

 

2013

 

2000

 

19715 Governors Highway

Folsom, CA

 

 

-

 

1,490

 

32,754

 

37

 

1,490

 

32,791

 

3,354

 

2015

 

2014

 

1574 Creekside Drive

Fort Worth, TX

 

 

-

 

2,080

 

27,888

 

3,638

 

2,093

 

31,513

 

7,915

 

2012

 

2001

 

2151 Green Oaks Road

Fort Worth, TX

 

 

-

 

1,740

 

19,799

 

1,012

 

1,740

 

20,811

 

1,610

 

2016

 

2014

 

7001 Bryant Irvin Road

Franklin, MA

 

 

-

 

2,430

 

30,597

 

2,484

 

2,458

 

33,053

 

5,582

 

2013

 

1999

 

4 Forge Hill Road

Frome, UKK

 

 

-

 

2,720

 

14,813

 

1,861

 

2,983

 

16,411

 

1,747

 

2014

 

2012

 

Welshmill Lane

Fullerton, CA

 

 

-

 

1,964

 

19,989

 

837

 

1,998

 

20,792

 

4,094

 

2013

 

2008

 

2226 North Euclid Street

Gahanna, OH

 

 

-

 

772

 

11,214

 

1,337

 

787

 

12,537

 

2,302

 

2013

 

1998

 

775 East Johnstown Road

Gilbert, AZ

 

 

15,747

 

2,160

 

28,246

 

949

 

2,176

 

29,179

 

7,465

 

2013

 

2008

 

580 S. Gilbert Road

Gilroy, CA

 

 

-

 

760

 

13,880

 

24,812

 

1,578

 

37,875

 

10,084

 

2006

 

2007

 

7610 Isabella Way

Glen Cove, NY

 

 

-

 

4,594

 

35,236

 

1,661

 

4,634

 

36,857

 

8,125

 

2013

 

1998

 

39 Forest Avenue

Glenview, IL

 

 

-

 

2,090

 

69,288

 

2,757

 

2,090

 

72,045

 

13,683

 

2012

 

2001

 

2200 Golf Road

Golden Valley, MN

 

 

19,022

 

1,520

 

33,513

 

1,126

 

1,545

 

34,614

 

6,045

 

2013

 

2005

 

4950 Olson Memorial Highway

Granbury, TX

 

 

-

 

2,040

 

30,670

 

502

 

2,040

 

31,172

 

5,475

 

2011

 

2009

 

100 Watermark Boulevard

Grimsby, ON

 

 

-

 

636

 

5,617

 

803

 

708

 

6,348

 

885

 

2015

 

1991

 

84 Main Street East

Grosse Pointe Woods, MI

 

 

-

 

950

 

13,662

 

494

 

950

 

14,156

 

2,422

 

2013

 

2006

 

1850 Vernier Road

Grosse Pointe Woods, MI

 

 

-

 

1,430

 

31,777

 

962

 

1,435

 

32,734

 

5,626

 

2013

 

2005

 

21260 Mack Avenue

Guelph, ON

 

 

4,486

 

1,190

 

7,597

 

1,183

 

1,333

 

8,638

 

1,432

 

2015

 

1978

 

165 Cole Road

Guildford, UKJ

 

 

-

 

5,361

 

56,494

 

6,278

 

5,879

 

62,254

 

10,783

 

2013

 

2006

 

Astolat Way, Peasmarsh

Gurnee, IL

 

 

-

 

890

 

27,931

 

1,900

 

935

 

29,786

 

4,857

 

2013

 

2002

 

500 North Hunt Club Road

Hamden, CT

 

 

-

 

1,460

 

24,093

 

1,698

 

1,487

 

25,764

 

6,780

 

2011

 

1999

 

35 Hamden Hills Drive 

Hampshire, UKJ

 

 

-

 

4,172

 

26,035

 

3,010

 

4,584

 

28,633

 

5,267

 

2013

 

2006

 

22-26 Church Road

Haverhill, MA

 

 

-

 

1,720

 

50,046

 

968

 

1,723

 

51,010

 

6,411

 

2015

 

1997

 

254 Amesbury Road

Henderson, NV

 

 

-

 

880

 

29,809

 

645

 

897

 

30,437

 

5,605

 

2011

 

2009

 

1935 Paseo Verde Parkway

Henderson, NV

 

 

-

 

1,190

 

11,600

 

774

 

1,252

 

12,312

 

3,374

 

2013

 

2008

 

1555 West Horizon Ridge Parkway

High Wycombe, UKJ

 

 

-

 

3,784

 

14,191

 

-

 

3,784

 

14,191

 

241

 

2015

 

2017

 

The Row Lane End

Highland Park, IL

 

 

-

 

2,250

 

25,313

 

1,223

 

2,265

 

26,521

 

5,662

 

2013

 

2005

 

1601 Green Bay Road

Hingham, MA

 

 

-

 

1,440

 

32,292

 

176

 

1,440

 

32,467

 

3,666

 

2015

 

2012

 

1 Sgt. William B Terry Drive

Holbrook, NY

 

 

-

 

3,957

 

35,337

 

1,109

 

4,021

 

36,382

 

6,615

 

2013

 

2001

 

320 Patchogue Holbrook Road

Horley, UKJ

 

 

-

 

2,332

 

12,144

 

1,521

 

2,565

 

13,432

 

1,981

 

2014

 

2014

 

Court Lodge Road

Houston, TX

 

 

-

 

3,830

 

55,674

 

6,489

 

3,830

 

62,163

 

13,392

 

2012

 

1998

 

2929 West Holcombe Boulevard

Houston, TX

 

 

16,922

 

1,040

 

31,965

 

5,561

 

1,049

 

37,517

 

7,104

 

2012

 

1999

 

505 Bering Drive

Houston, TX

 

 

-

 

1,750

 

15,603

 

1,264

 

1,750

 

16,867

 

738

 

2016

 

2014

 

10120 Louetta Road

Huntington Beach, CA

 

 

-

 

3,808

 

31,172

 

2,429

 

3,886

 

33,523

 

7,290

 

2013

 

2004

 

7401 Yorktown Avenue

Irving, TX

 

 

-

 

1,030

 

6,823

 

1,508

 

1,030

 

8,331

 

2,428

 

2007

 

1999

 

8855 West Valley Ranch Parkway

Johns Creek, GA

 

 

-

 

1,580

 

23,285

 

586

 

1,588

 

23,863

 

4,448

 

2013

 

2009

 

11405 Medlock Bridge Road

Kanata, ON

 

 

-

 

1,689

 

28,670

 

2,642

 

1,812

 

31,189

 

5,491

 

2012

 

2005

 

70 Stonehaven Drive

Kansas City, MO

 

 

-

 

1,820

 

34,898

 

4,570

 

1,845

 

39,443

 

10,363

 

2010

 

1980

 

12100 Wornall Road

Kansas City, MO

 

 

5,620

 

1,930

 

39,997

 

4,369

 

1,963

 

44,333

 

11,808

 

2010

 

1986

 

6500 North Cosby Ave

Kansas City, MO

 

 

-

 

541

 

23,962

 

173

 

545

 

24,131

 

2,418

 

2015

 

2014

 

6460 North Cosby Avenue

Kelowna, BC

 

 

5,942

 

2,688

 

13,647

 

2,103

 

2,984

 

15,453

 

3,689

 

2013

 

1999

 

863 Leon Avenue

Kennebunk, ME

 

 

-

 

2,700

 

30,204

 

4,739

 

3,200

 

34,442

 

11,037

 

2013

 

2006

 

One Huntington Common Drive

Kingston, ON

 

 

4,767

 

1,030

 

11,416

 

1,637

 

1,154

 

12,928

 

1,574

 

2015

 

1983

 

181 Ontario Street

Kingwood, TX

 

 

-

 

480

 

9,777

 

1,080

 

480

 

10,857

 

2,524

 

2011

 

1999

 

22955 Eastex Freeway

Kingwood, TX

 

 

-

 

1,683

 

24,207

 

2,448

 

1,683

 

26,655

 

496

 

2017

 

2012

 

24025 Kingwood Place

Kirkland, WA

 

 

24,600

 

3,450

 

38,709

 

848

 

3,515

 

39,491

 

7,883

 

2011

 

2009

 

14 Main Street South

Kitchener, ON

 

 

1,514

 

708

 

2,744

 

393

 

708

 

3,138

 

727

 

2013

 

1979

 

164 - 168 Ferfus Avenue

Kitchener, ON

 

 

4,833

 

1,130

 

9,939

 

1,367

 

1,267

 

11,169

 

2,307

 

2013

 

1988

 

20 Fieldgate Street

Kitchener, ON

 

 

3,682

 

1,093

 

7,327

 

1,030

 

1,212

 

8,239

 

2,164

 

2013

 

1964

 

290 Queen Street South

Kitchener, ON

 

 

13,681

 

1,341

 

13,939

 

4,064

 

1,443

 

17,901

 

1,974

 

2016

 

2003

 

1250 Weber Street E

La Palma, CA

 

 

-

 

2,950

 

16,591

 

822

 

2,966

 

17,398

 

3,346

 

2013

 

2003

 

5321 La Palma Avenue

Lafayette Hill, PA

 

 

-

 

1,750

 

11,848

 

2,214

 

1,867

 

13,945

 

3,430

 

2013

 

1998

 

429 Ridge Pike

Laguna Hills, CA

 

 

-

 

12,820

 

75,926

 

11,912

 

12,820

 

87,838

 

6,020

 

2016

 

1988

 

24903 Moulton Parkway

Laguna Woods, CA

 

 

-

 

11,280

 

76,485

 

9,929

 

11,280

 

86,414

 

6,754

 

2016

 

1987

 

24441 Calle Sonora

Laguna Woods, CA

 

 

-

 

9,150

 

57,842

 

6,364

 

9,150

 

64,206

 

5,550

 

2016

 

1986

 

24962 Calle Aragon

Lake Zurich, IL

 

 

-

 

1,470

 

9,830

 

2,940

 

1,470

 

12,770

 

4,074

 

2011

 

2007

 

550 America Court

Lawrenceville, GA

 

 

-

 

1,500

 

29,003

 

677

 

1,508

 

29,672

 

5,615

 

2013

 

2008

 

1375 Webb Gin House Road

Leatherhead, UKJ

 

 

-

 

4,967

 

18,859

 

-

 

4,967

 

18,859

 

226

 

2015

 

2017

 

Rectory Lane

Leawood, KS

 

 

15,021

 

2,490

 

32,493

 

3,799

 

5,690

 

33,091

 

7,993

 

2012

 

1999

 

4400 West 115th Street

Lenexa, KS

 

 

9,396

 

826

 

26,251

 

947

 

850

 

27,173

 

5,665

 

2013

 

2006

 

15055 West 87th Street Parkway

Leominster, MA

 

 

-

 

944

 

23,164

 

647

 

992

 

23,763

 

2,958

 

2015

 

1999

 

1160 Main Street

Lincroft, NJ

 

 

-

 

9

 

19,958

 

1,453

 

29

 

21,391

 

3,979

 

2013

 

2002

 

734 Newman Springs Road

Lombard, IL

 

 

16,297

 

2,130

 

59,943

 

1,390

 

2,147

 

61,316

 

10,789

 

2013

 

2009

 

2210 Fountain Square Dr

London, UKI

 

 

-

 

3,121

 

10,027

 

1,459

 

3,428

 

11,179

 

1,391

 

2014

 

2012

 

71 Hatch Lane

London, ON

 

 

476

 

987

 

8,228

 

1,425

 

1,122

 

9,517

 

1,321

 

2015

 

1989

 

760 Horizon Drive

London, ON

 

 

12,381

 

1,969

 

16,985

 

2,873

 

2,177

 

19,650

 

2,795

 

2015

 

1953

 

1486 Richmond Street North

London, ON

 

 

-

 

1,445

 

13,631

 

1,944

 

1,689

 

15,331

 

1,917

 

2015

 

1950

 

81 Grand Avenue

Longueuil, QC

 

 

10,257

 

3,992

 

23,711

 

4,195

 

4,469

 

27,428

 

3,623

 

2015

 

1989

 

70 Rue Levis

Los Angeles, CA

 

 

-

 

-

 

11,430

 

2,124

 

-

 

13,554

 

3,397

 

2008

 

1971

 

330 North Hayworth Avenue

Los Angeles, CA

 

 

61,460

 

-

 

114,438

 

1,908

 

-

 

116,346

 

25,572

 

2011

 

2009

 

10475 Wilshire Boulevard

Los Angeles, CA

 

 

-

 

3,540

 

19,007

 

2,250

 

3,540

 

21,257

 

4,179

 

2012

 

2001

 

2051 N. Highland Avenue

Los Angeles, CA

 

 

-

 

-

 

28,050

 

1,960

 

-

 

30,010

 

2,169

 

2016

 

2006

 

4061 Grand View Boulevard

Louisville, KY

 

 

-

 

2,420

 

20,816

 

1,505

 

2,420

 

22,321

 

4,614

 

2012

 

1999

 

4600 Bowling Boulevard

Louisville, KY

 

 

10,775

 

1,600

 

20,326

 

647

 

1,600

 

20,973

 

4,334

 

2013

 

2010

 

6700 Overlook Drive

Lynnfield, MA

 

 

-

 

3,165

 

45,200

 

2,027

 

3,165

 

47,226

 

8,848

 

2013

 

2006

 

55 Salem Street

Malvern, PA

 

 

-

 

1,651

 

17,194

 

1,803

 

1,739

 

18,910

 

4,875

 

2013

 

1998

 

324 Lancaster Avenue

Mansfield, MA

 

 

-

 

3,320

 

57,011

 

8,265

 

3,447

 

65,149

 

15,871

 

2011

 

1998

 

25 Cobb Street 

Maple Ridge, BC

 

 

9,158

 

2,875

 

11,922

 

1,158

 

3,095

 

12,860

 

1,306

 

2015

 

2009

 

12241 224th Street

Marieville, QC

 

 

7,008

 

1,278

 

12,113

 

1,138

 

1,419

 

13,110

 

1,453

 

2015

 

2002

 

425 rue Claude de Ramezay

Markham, ON

 

 

41,037

 

3,727

 

48,939

 

6,060

 

4,161

 

54,564

 

13,923

 

2013

 

1981

 

7700 Bayview Avenue

Marlboro, NJ

 

 

-

 

2,222

 

14,888

 

1,058

 

2,250

 

15,918

 

3,273

 

2013

 

2002

 

3A South Main Street

Medicine Hat, AB

 

 

11,543

 

1,432

 

14,141

 

1,390

 

1,591

 

15,372

 

2,746

 

2015

 

1999

 

223 Park Meadows Drive SE

Melbourne, FL

 

 

-

 

7,070

 

48,257

 

28,853

 

7,070

 

77,110

 

14,328

 

2007

 

2009

 

7300 Watersong Lane

Memphis, TN

 

 

-

 

1,800

 

17,744

 

1,477

 

1,800

 

19,221

 

4,957

 

2012

 

1999

 

6605 Quail Hollow Road

Meriden, CT

 

 

-

 

1,500

 

14,874

 

1,103

 

1,538

 

15,940

 

5,185

 

2011

 

2001

 

511 Kensington Avenue 

Metairie, LA

 

 

12,773

 

725

 

27,708

 

663

 

725

 

28,372

 

4,812

 

2013

 

2009

 

3732 West Esplanade Ave. S

Middletown, CT

 

 

-

 

1,430

 

24,242

 

1,487

 

1,441

 

25,717

 

6,965

 

2011

 

1999

 

645 Saybrook Road

Middletown, RI

 

 

-

 

2,480

 

24,628

 

1,777

 

2,511

 

26,373

 

7,065

 

2011

 

1998

 

303 Valley Road

Milford, CT

 

 

-

 

3,210

 

17,364

 

1,835

 

3,233

 

19,176

 

5,738

 

2011

 

1999

 

77 Plains Road 

Milton, ON

 

 

15,391

 

4,542

 

25,321

 

4,512

 

5,039

 

29,335

 

3,036

 

2015

 

2012

 

611 Farmstead Drive

Minnetonka, MN

 

 

13,654

 

2,080

 

24,360

 

2,289

 

2,376

 

26,353

 

5,430

 

2012

 

1999

 

500 Carlson Parkway

Minnetonka, MN

 

 

15,651

 

920

 

29,344

 

803

 

954

 

30,112

 

5,056

 

2013

 

2006

 

18605 Old Excelsior Blvd.

Mission Viejo, CA

 

 

14,118

 

6,600

 

52,118

 

5,565

 

6,600

 

57,683

 

4,621

 

2016

 

1998

 

27783 Center Drive

Mississauga, ON

 

 

9,409

 

1,602

 

17,996

 

2,334

 

1,771

 

20,161

 

4,016

 

2013

 

1984

 

1130 Bough Beeches Boulevard

Mississauga, ON

 

 

3,169

 

873

 

4,655

 

728

 

966

 

5,290

 

1,091

 

2013

 

1978

 

3051 Constitution Boulevard

Mississauga, ON

 

 

30,008

 

3,649

 

35,137

 

4,715

 

4,053

 

39,449

 

7,892

 

2015

 

1988

 

1490 Rathburn Road East

Mississauga, ON

 

 

6,471

 

2,548

 

15,158

 

3,195

 

2,817

 

18,085

 

2,977

 

2015

 

1989

 

85 King Street East

Mobberley, UKD

 

 

-

 

5,146

 

26,665

 

3,417

 

5,654

 

29,573

 

6,980

 

2013

 

2007

 

Barclay Park, Hall Lane

Monterey, CA

 

 

-

 

6,440

 

29,101

 

942

 

6,440

 

30,043

 

5,624

 

2013

 

2009

 

1110 Cass St.

Montgomery Village, MD

 

 

-

 

3,530

 

18,246

 

6,448

 

4,187

 

24,037

 

7,944

 

2013

 

1993

 

19310 Club House Road

Moose Jaw, SK

 

 

2,476

 

582

 

12,973

 

1,925

 

643

 

14,837

 

2,931

 

2013

 

2001

 

425 4th Avenue NW

Murphy, TX

 

 

-

 

1,950

 

19,182

 

778

 

1,950

 

19,960

 

1,214

 

2015

 

2012

 

304 West FM 544

Mystic, CT

 

 

-

 

1,400

 

18,274

 

954

 

1,427

 

19,201

 

5,096

 

2011

 

2001

 

20 Academy Lane  Mystic

Naperville, IL

 

 

-

 

1,550

 

12,237

 

2,283

 

1,550

 

14,520

 

3,380

 

2012

 

2013

 

1936 Brookdale Road

Naperville, IL

 

 

-

 

1,540

 

28,204

 

1,178

 

1,546

 

29,377

 

5,687

 

2013

 

2002

 

535 West Ogden Avenue

Naples, FL

 

 

57,022

 

8,989

 

119,398

 

4,088

 

9,074

 

123,401

 

15,758

 

2015

 

2000

 

4800 Aston Gardens Way

Nashua, NH

 

 

-

 

1,264

 

43,026

 

611

 

1,264

 

43,637

 

4,311

 

2015

 

1999

 

674 West Hollis Street

Nashville, TN

 

 

-

 

3,900

 

35,788

 

2,198

 

3,900

 

37,986

 

9,120

 

2012

 

1999

 

4206 Stammer Place

Needham, MA

 

 

-

 

1,240

 

32,992

 

1,186

 

1,240

 

34,178

 

1,952

 

2016

 

2011

 

880 Greendale Avenue

Nepean, ON

 

 

6,045

 

1,575

 

5,770

 

1,038

 

1,757

 

6,626

 

1,377

 

2015

 

1988

 

1 Mill Hill Road

New Braunfels, TX

 

 

-

 

1,200

 

19,800

 

10,296

 

2,729

 

28,567

 

4,142

 

2011

 

2009

 

2294 East Common Street

Newbury, UKJ

 

 

-

 

2,850

 

12,796

 

1,591

 

3,125

 

14,111

 

467

 

2015

 

2016

 

370 London Road

Newburyport, MA

 

 

-

 

1,750

 

29,187

 

1,162

 

1,750

 

30,350

 

1,855

 

2016

 

2015

 

4 Wallace Bashaw Junior Way

Newmarket, UKH

 

 

-

 

4,071

 

11,902

 

1,806

 

4,471

 

13,308

 

1,702

 

2014

 

2011

 

Jeddah Way

Newton, MA

 

 

-

 

2,250

 

43,614

 

1,116

 

2,263

 

44,717

 

10,785

 

2011

 

1996

 

2300 Washington Street

Newton, MA

 

 

15,227

 

2,500

 

30,681

 

2,367

 

2,521

 

33,027

 

8,396

 

2011

 

1996

 

280 Newtonville Avenue 

Newton, MA

 

 

-

 

3,360

 

25,099

 

1,618

 

3,385

 

26,692

 

7,199

 

2011

 

1994

 

430 Centre Street

Newtown Square, PA

 

 

-

 

1,930

 

14,420

 

1,041

 

1,941

 

15,450

 

4,093

 

2013

 

2004

 

333 S. Newtown Street Rd.

Niagara Falls, ON

 

 

7,109

 

1,225

 

7,963

 

1,272

 

1,355

 

9,105

 

1,340

 

2015

 

1991

 

7860 Lundy's Lane

Niantic, CT

 

 

-

 

1,320

 

25,986

 

4,432

 

1,334

 

30,404

 

6,405

 

2011

 

2001

 

417 Main Street

North Andover, MA

 

 

-

 

1,960

 

34,976

 

1,780

 

2,092

 

36,624

 

8,965

 

2011

 

1995

 

700 Chickering Road 

North Chelmsford, MA

 

 

-

 

880

 

18,478

 

935

 

951

 

19,342

 

4,544

 

2011

 

1998

 

2 Technology Drive 

North Dartmouth, MA

 

 

-

 

1,700

 

35,337

 

1,628

 

1,700

 

36,965

 

2,298

 

2016

 

1997

 

239 Cross Road

North Tustin, CA

 

 

-

 

2,880

 

18,059

 

825

 

2,975

 

18,788

 

3,056

 

2013

 

2000

 

12291 Newport Avenue

Oak Park, IL

 

 

-

 

1,250

 

40,383

 

1,496

 

1,250

 

41,879

 

8,350

 

2012

 

2004

 

1035 Madison Street

Oakland, CA

 

 

-

 

3,877

 

47,508

 

2,965

 

3,901

 

50,449

 

9,458

 

2013

 

1999

 

11889 Skyline Boulevard

Oakton, VA

 

 

-

 

2,250

 

37,576

 

1,983

 

2,300

 

39,509

 

7,200

 

2013

 

1997

 

2863 Hunter Mill Road

Oakville, ON

 

 

6,158

 

1,252

 

7,382

 

996

 

1,392

 

8,239

 

1,733

 

2013

 

1982

 

289 and 299 Randall Street

Oakville, ON

 

 

10,439

 

2,134

 

29,963

 

4,098

 

2,363

 

33,832

 

7,199

 

2013

 

1994

 

25 Lakeshore Road West

Oakville, ON

 

 

5,462

 

1,271

 

13,754

 

1,924

 

1,405

 

15,543

 

2,791

 

2013

 

1988

 

345 Church Street

Oceanside, CA

 

 

-

 

2,160

 

18,352

 

3,776

 

2,210

 

22,078

 

5,314

 

2011

 

2005

 

3500 Lake Boulevard

Okotoks, AB

 

 

19,493

 

714

 

20,943

 

2,475

 

789

 

23,342

 

3,412

 

2015

 

2010

 

51 Riverside Gate

Oshawa, ON

 

 

3,144

 

841

 

7,570

 

1,252

 

963

 

8,700

 

1,774

 

2013

 

1991

 

649 King Street East

Ottawa, ON

 

 

10,658

 

1,341

 

15,425

 

2,752

 

1,520

 

17,998

 

1,930

 

2015

 

2001

 

110 Berrigan Drive

Ottawa, ON

 

 

19,984

 

3,454

 

23,309

 

3,639

 

3,872

 

26,530

 

6,517

 

2015

 

1966

 

2370 Carling Avenue

Ottawa, ON

 

 

22,945

 

4,305

 

39,106

 

3,494

 

4,632

 

42,274

 

5,449

 

2015

 

2005

 

751 Peter Morand Crescent

Ottawa, ON

 

 

7,940

 

2,103

 

18,421

 

4,560

 

2,345

 

22,739

 

2,719

 

2015

 

1989

 

1 Eaton Street

Ottawa, ON

 

 

15,092

 

2,963

 

26,424

 

4,480

 

3,294

 

30,571

 

3,225

 

2015

 

2008

 

691 Valin Street

Ottawa, ON

 

 

11,412

 

1,561

 

18,170

 

2,770

 

1,762

 

20,738

 

2,116

 

2015

 

2006

 

22 Barnstone Drive

Ottawa, ON

 

 

14,405

 

3,403

 

31,090

 

4,983

 

3,775

 

35,702

 

3,631

 

2015

 

2009

 

990 Hunt Club Road

Ottawa, ON

 

 

19,417

 

3,411

 

28,335

 

7,128

 

3,799

 

35,075

 

4,910

 

2015

 

2009

 

2 Valley Stream Drive

Ottawa, ON

 

 

3,112

 

724

 

4,710

 

705

 

801

 

5,339

 

1,122

 

2013

 

1995

 

1345 Ogilvie Road

Ottawa, ON

 

 

2,266

 

818

 

2,165

 

1,502

 

753

 

3,732

 

853

 

2013

 

1993

 

370 Kennedy Lane

Ottawa, ON

 

 

10,914

 

2,809

 

27,299

 

3,891

 

3,109

 

30,890

 

7,089

 

2013

 

1998

 

43 Aylmer Avenue

Ottawa, ON

 

 

4,994

 

1,156

 

9,758

 

1,408

 

1,336

 

10,987

 

2,038

 

2013

 

1998

 

1351 Hunt Club Road

Ottawa, ON

 

 

6,500

 

746

 

7,800

 

1,211

 

831

 

8,926

 

1,739

 

2013

 

1999

 

140 Darlington Private

Ottawa, ON

 

 

9,796

 

1,176

 

12,764

 

1,941

 

1,320

 

14,560

 

1,649

 

2015

 

1987

 

10 Vaughan Street

Overland Park, KS

 

 

3,336

 

1,540

 

16,269

 

1,331

 

1,728

 

17,413

 

3,549

 

2012

 

1998

 

9201 Foster

Palo Alto, CA

 

 

16,217

 

-

 

39,639

 

2,696

 

24

 

42,311

 

7,559

 

2013

 

2007

 

2701 El Camino Real

Paramus, NJ

 

 

-

 

2,840

 

35,728

 

1,566

 

2,903

 

37,231

 

6,566

 

2013

 

1998

 

567 Paramus Road

Parkland, FL

 

 

56,604

 

4,880

 

111,481

 

3,276

 

4,885

 

114,751

 

15,436

 

2015

 

2000

 

5999 University Drive

Peabody, MA

 

 

6,117

 

2,250

 

16,071

 

995

 

2,324

 

16,992

 

2,353

 

2013

 

1994

 

73 Margin Street

Pembroke, ON

 

 

-

 

1,931

 

9,427

 

1,075

 

2,071

 

10,362

 

1,804

 

2012

 

1999

 

1111 Pembroke Street West

Pittsburgh, PA

 

 

-

 

1,580

 

18,017

 

807

 

1,587

 

18,817

 

3,881

 

2013

 

2009

 

900 Lincoln Club Dr.

Placentia, CA

 

 

-

 

8,480

 

17,076

 

2,448

 

8,480

 

19,525

 

2,402

 

2016

 

1987

 

1180 N Bradford Avenue

Plainview, NY

 

 

-

 

3,066

 

19,901

 

764

 

3,182

 

20,549

 

3,521

 

2013

 

2001

 

1231 Old Country Road

Plano, TX

 

 

27,671

 

3,120

 

59,950

 

2,205

 

3,173

 

62,102

 

14,899

 

2013

 

2006

 

4800 West Parker Road

Plano, TX

 

 

-

 

1,750

 

15,390

 

1,660

 

1,750

 

17,051

 

1,053

 

2016

 

2014

 

3690 Mapleshade Lane

Playa Vista, CA

 

 

-

 

1,580

 

40,531

 

1,029

 

1,605

 

41,536

 

7,854

 

2013

 

2006

 

5555 Playa Vista Drive

Plymouth, MA

 

 

-

 

1,444

 

34,951

 

697

 

1,444

 

35,648

 

4,039

 

2015

 

1998

 

157 South Street

Plymouth, MA

 

 

13,462

 

2,550

 

35,055

 

2,123

 

2,550

 

37,178

 

2,440

 

2016

 

1970

 

60 Stafford Hill

Port Perry, ON

 

 

9,905

 

3,685

 

26,788

 

5,059

 

4,079

 

31,453

 

2,988

 

2015

 

2009

 

15987 Simcoe Street

Port St. Lucie, FL

 

 

-

 

8,700

 

47,230

 

20,372

 

8,700

 

67,602

 

11,380

 

2008

 

2010

 

10685 SW Stony Creek Way

Providence, RI

 

 

-

 

2,655

 

21,910

 

320

 

2,655

 

22,230

 

8,980

 

2011

 

1998

 

700 Smith Street

Purley, UKI

 

 

-

 

7,365

 

35,161

 

4,583

 

8,077

 

39,033

 

8,201

 

2012

 

2005

 

21 Russell Hill Road

Queensbury, NY

 

 

-

 

1,260

 

21,744

 

964

 

1,260

 

22,708

 

2,401

 

2015

 

1999

 

27 Woodvale Road

Quincy, MA

 

 

-

 

1,350

 

12,584

 

831

 

1,428

 

13,337

 

3,635

 

2011

 

1998

 

2003 Falls Boulevard

Rancho Cucamonga, CA

 

 

-

 

1,480

 

10,055

 

1,141

 

1,567

 

11,109

 

2,568

 

2013

 

2001

 

9519 Baseline Road

Rancho Palos Verdes, CA

 

 

-

 

5,450

 

60,034

 

2,023

 

5,450

 

62,057

 

12,432

 

2012

 

2004

 

5701 Crestridge Road

Randolph, NJ

 

 

-

 

1,540

 

46,934

 

799

 

1,570

 

47,703

 

8,586

 

2013

 

2006

 

648 Route 10 West

Red Deer, AB

 

 

13,102

 

1,247

 

19,283

 

2,324

 

1,379

 

21,476

 

2,820

 

2015

 

2004

 

3100 - 22 Street

Red Deer, AB

 

 

15,419

 

1,199

 

22,339

 

2,756

 

1,328

 

24,966

 

3,330

 

2015

 

2004

 

10 Inglewood Drive

Redondo Beach, CA

 

 

-

 

-

 

9,557

 

878

 

-

 

10,435

 

5,609

 

2011

 

1957

 

514 North Prospect Ave

Regina, SK

 

 

7,115

 

1,485

 

21,148

 

2,618

 

1,662

 

23,590

 

5,180

 

2013

 

1999

 

3651 Albert Street

Regina, SK

 

 

6,980

 

1,244

 

21,036

 

2,720

 

1,380

 

23,620

 

4,380

 

2013

 

2004

 

3105 Hillsdale Street

Regina, SK

 

 

16,884

 

1,539

 

24,053

 

4,834

 

1,704

 

28,722

 

3,385

 

2015

 

1992

 

1801 McIntyre Street

Renton, WA

 

 

20,790

 

3,080

 

51,824

 

1,123

 

3,119

 

52,908

 

10,446

 

2011

 

2007

 

104 Burnett Avenue South

Ridgefield, CT

 

 

-

 

3,100

 

80,614

 

4,737

 

3,150

 

85,302

 

11,313

 

2015

 

1998

 

640 Danbury Road

Riviere-du-Loup, QC

 

 

3,326

 

592

 

7,601

 

938

 

642

 

8,489

 

895

 

2015

 

1956

 

35 des Cedres

Riviere-du-Loup, QC

 

 

9,515

 

1,454

 

16,848

 

4,901

 

1,700

 

21,503

 

2,890

 

2015

 

1993

 

230-235 rue Des Chenes

Rocky Hill, CT

 

 

-

 

810

 

16,351

 

744

 

909

 

16,995

 

4,150

 

2011

 

2000

 

1160 Elm Street

Romeoville, IL

 

 

-

 

854

 

12,646

 

60,571

 

6,174

 

67,897

 

14,427

 

2006

 

2010

 

605 S Edward Dr.

Roseville, MN

 

 

-

 

1,540

 

35,877

 

932

 

1,607

 

36,741

 

6,269

 

2013

 

2002

 

2555 Snelling Avenue, North

Roseville, CA

 

 

-

 

3,300

 

41,652

 

3,235

 

3,300

 

44,886

 

3,868

 

2016

 

2000

 

5161 Foothills Boulevard

Roswell, GA

 

 

-

 

2,080

 

6,486

 

1,558

 

2,385

 

7,739

 

1,891

 

2012

 

1997

 

75 Magnolia Street

Sacramento, CA

 

 

-

 

1,300

 

23,394

 

1,226

 

1,334

 

24,587

 

4,343

 

2013

 

2004

 

345 Munroe Street

Saint-Lambert, QC

 

 

37,529

 

10,259

 

61,903

 

5,961

 

11,414

 

66,709

 

10,015

 

2015

 

1989

 

1705 Avenue Victoria

Salem, NH

 

 

-

 

980

 

32,721

 

4,181

 

1,054

 

36,828

 

7,726

 

2011

 

2000

 

242 Main Street

Salinas, CA

 

 

-

 

5,110

 

41,424

 

5,493

 

5,110

 

46,916

 

4,462

 

2016

 

1990

 

1320 Padre Drive

Salisbury, UKK

 

 

-

 

2,720

 

15,269

 

1,820

 

2,983

 

16,826

 

1,636

 

2014

 

2013

 

Shapland Close

Salt Lake City, UT

 

 

-

 

1,360

 

19,691

 

1,949

 

1,360

 

21,640

 

6,685

 

2011

 

1986

 

1430 E. 4500 S.

San Antonio, TX

 

 

-

 

6,120

 

28,169

 

2,482

 

6,120

 

30,651

 

5,207

 

2010

 

2011

 

2702 Cembalo Blvd

San Antonio, TX

 

 

-

 

5,045

 

58,048

 

3,129

 

5,045

 

61,177

 

656

 

2017

 

2015

 

11300 Wild Pine

San Diego, CA

 

 

-

 

4,200

 

30,707

 

513

 

4,243

 

31,177

 

4,952

 

2011

 

2011

 

2567 Second Avenue

San Diego, CA

 

 

-

 

5,810

 

63,078

 

2,329

 

5,810

 

65,407

 

15,249

 

2012

 

2001

 

13075 Evening Creek Drive S

San Diego, CA

 

 

-

 

3,000

 

27,164

 

763

 

3,000

 

27,927

 

4,709

 

2013

 

2003

 

810 Turquoise Street

San Francisco, CA

 

 

-

 

5,920

 

91,639

 

11,529

 

5,920

 

103,168

 

7,666

 

2016

 

1998

 

1550 Sutter Street

San Francisco, CA

 

 

-

 

11,800

 

77,214

 

9,132

 

11,800

 

86,346

 

6,679

 

2016

 

1923

 

1601 19th Avenue

San Gabriel, CA

 

 

-

 

3,120

 

15,566

 

860

 

3,138

 

16,407

 

3,283

 

2013

 

2005

 

8332 Huntington Drive

San Jose, CA

 

 

-

 

2,850

 

35,098

 

600

 

2,858

 

35,690

 

7,052

 

2011

 

2009

 

1420 Curvi Drive

San Jose, CA

 

 

-

 

3,280

 

46,823

 

2,355

 

3,280

 

49,178

 

9,756

 

2012

 

2002

 

500 S Winchester Boulevard

San Jose, CA

 

 

-

 

11,900

 

27,647

 

3,271

 

11,900

 

30,918

 

3,497

 

2016

 

2002

 

4855 San Felipe Road

San Juan Capistrano, CA

 

 

-

 

1,390

 

6,942

 

1,491

 

1,390

 

8,433

 

3,634

 

2000

 

2001

 

30311 Camino Capistrano

San Rafael, CA

 

 

-

 

1,620

 

27,392

 

1,960

 

1,635

 

29,337

 

2,597

 

2016

 

2001

 

111 Merrydale Road

San Ramon, CA

 

 

-

 

8,700

 

72,223

 

6,745

 

8,700

 

78,968

 

6,181

 

2016

 

1992

 

9199 Fircrest Lane

Sandy Springs, GA

 

 

-

 

2,214

 

8,360

 

676

 

2,220

 

9,030

 

2,404

 

2012

 

1997

 

5455 Glenridge Drive NE

Santa Maria, CA

 

 

-

 

6,050

 

50,658

 

2,966

 

6,089

 

53,585

 

13,408

 

2011

 

2001

 

1220 Suey Road

Santa Monica, CA

 

 

19,149

 

5,250

 

28,340

 

869

 

5,263

 

29,196

 

5,352

 

2013

 

2004

 

1312 15th Street

Santa Rosa, CA

 

 

-

 

2,250

 

26,273

 

2,094

 

2,250

 

28,367

 

2,623

 

2016

 

2001

 

4225 Wayvern Drive

Saskatoon, SK

 

 

4,390

 

981

 

13,905

 

1,778

 

1,084

 

15,580

 

2,760

 

2013

 

1999

 

220 24th Street East

Saskatoon, SK

 

 

14,740

 

1,382

 

17,609

 

2,272

 

1,528

 

19,735

 

3,435

 

2013

 

2004

 

1622 Acadia Drive

Schaumburg, IL

 

 

-

 

2,460

 

22,863

 

1,060

 

2,486

 

23,896

 

5,198

 

2013

 

2001

 

790 North Plum Grove Road

Scottsdale, AZ

 

 

-

 

2,500

 

3,890

 

1,704

 

2,500

 

5,594

 

1,583

 

2008

 

1998

 

9410 East Thunderbird Road

Seal Beach, CA

 

 

-

 

6,204

 

72,954

 

1,757

 

6,271

 

74,644

 

17,334

 

2013

 

2004

 

3850 Lampson Avenue

Seattle, WA

 

 

48,540

 

6,790

 

85,369

 

2,520

 

6,825

 

87,854

 

17,947

 

2011

 

2009

 

5300 24th Avenue NE

Seattle, WA

 

 

-

 

1,150

 

19,887

 

1,032

 

1,150

 

20,919

 

2,119

 

2015

 

1995

 

11039 17th Avenue

Sevenoaks, UKJ

 

 

-

 

6,181

 

40,240

 

5,956

 

6,778

 

45,599

 

9,281

 

2012

 

2009

 

64 - 70 Westerham Road

Severna Park, MD

 

 

-

 

-

 

67,623

 

5,264

 

6

 

72,882

 

7,069

 

2016

 

1997

 

43 W McKinsey Road

Shelburne, VT

 

 

-

 

720

 

31,041

 

1,921

 

777

 

32,904

 

7,180

 

2011

 

1988

 

687 Harbor Road

Shelby Township, MI

 

 

15,894

 

1,040

 

26,344

 

1,170

 

1,100

 

27,453

 

4,716

 

2013

 

2006

 

46471 Hayes Road

Shelton, CT

 

 

-

 

2,246

 

33,967

 

-

 

2,246

 

33,967

 

1,839

 

2013

 

2014

 

708A Bridgeport Avenue

Shrewsbury, MA

 

 

-

 

950

 

26,824

 

1,315

 

950

 

28,139

 

3,286

 

2015

 

1997

 

3111 Main Street

Sidcup, UKI

 

 

-

 

7,446

 

56,570

 

6,802

 

8,183

 

62,636

 

14,212

 

2012

 

2000

 

Frognal Avenue

Simi Valley, CA

 

 

-

 

3,200

 

16,664

 

898

 

3,238

 

17,524

 

4,377

 

2013

 

2009

 

190 Tierra Rejada Road

Simi Valley, CA

 

 

-

 

5,510

 

51,406

 

6,469

 

5,510

 

57,875

 

4,891

 

2016

 

2003

 

5300 E Los Angeles Avenue

Solihull, UKG

 

 

-

 

5,070

 

43,297

 

5,457

 

5,560

 

48,264

 

9,412

 

2012

 

2009

 

1270 Warwick Road

Solihull, UKG

 

 

-

 

3,571

 

26,053

 

3,191

 

3,917

 

28,899

 

5,786

 

2013

 

2007

 

1 Worcester Way

Solihull, UKG

 

 

-

 

1,851

 

10,585

 

1,263

 

2,029

 

11,670

 

494

 

2015

 

2016

 

Warwick Road

Sonning, UKJ

 

 

-

 

5,644

 

42,155

 

5,197

 

6,189

 

46,807

 

8,529

 

2013

 

2009

 

Old Bath Rd.

Sonoma, CA

 

 

-

 

2,820

 

21,890

 

1,879

 

2,820

 

23,769

 

2,202

 

2016

 

2005

 

91 Napa Road

South Windsor, CT

 

 

-

 

3,000

 

29,295

 

2,870

 

3,104

 

32,061

 

8,587

 

2011

 

1999

 

432 Buckland Road

Spokane, WA

 

 

-

 

3,200

 

25,064

 

619

 

3,271

 

25,612

 

6,718

 

2013

 

2001

 

3117 E. Chaser Lane

Spokane, WA

 

 

-

 

2,580

 

25,342

 

399

 

2,639

 

25,682

 

5,571

 

2013

 

1999

 

1110 E. Westview Ct.

St. Albert, AB

 

 

8,701

 

1,145

 

17,863

 

3,003

 

1,266

 

20,745

 

5,136

 

2014

 

2005

 

78C McKenney Avenue

St. John's, NL

 

 

6,222

 

706

 

11,765

 

1,081

 

757

 

12,795

 

1,308

 

2015

 

2005

 

64 Portugal Cove Road

Stittsville, ON

 

 

4,848

 

1,175

 

17,397

 

2,286

 

1,299

 

19,559

 

3,456

 

2013

 

1996

 

1340 - 1354 Main Street

Stockport, UKD

 

 

-

 

4,369

 

25,018

 

3,041

 

4,791

 

27,637

 

6,015

 

2013

 

2008

 

1 Dairyground Road

Studio City, CA

 

 

-

 

4,006

 

25,307

 

988

 

4,071

 

26,230

 

5,707

 

2013

 

2004

 

4610 Coldwater Canyon Avenue

Sugar Land, TX

 

 

-

 

960

 

31,423

 

1,723

 

960

 

33,146

 

8,437

 

2011

 

1996

 

1221 Seventh St

Sugar Land, TX

 

 

-

 

4,272

 

60,493

 

6,497

 

4,272

 

66,989

 

970

 

2017

 

2015

 

744 Brooks Street

Sun City, FL

 

 

21,294

 

6,521

 

48,476

 

3,655

 

6,622

 

52,030

 

8,661

 

2015

 

1995

 

231 Courtyards

Sun City, FL

 

 

23,992

 

5,040

 

50,923

 

3,365

 

5,338

 

53,990

 

8,143

 

2015

 

1999

 

1311 Aston Gardens Court

Sun City West, AZ

 

 

11,780

 

1,250

 

21,778

 

1,123

 

1,274

 

22,877

 

4,311

 

2012

 

1998

 

13810 West Sandridge Drive

Sunnyvale, CA

 

 

-

 

5,420

 

41,682

 

1,995

 

5,420

 

43,677

 

8,985

 

2012

 

2002

 

1039 East El Camino Real

Surrey, BC

 

 

7,228

 

3,605

 

18,818

 

2,900

 

3,985

 

21,338

 

5,675

 

2013

 

2000

 

16028 83rd Avenue

Surrey, BC

 

 

17,047

 

4,552

 

22,338

 

3,780

 

5,045

 

25,625

 

7,201

 

2013

 

1987

 

15501 16th Avenue

Sutton, UKI

 

 

-

 

4,096

 

14,532

 

1,872

 

4,492

 

16,009

 

464

 

2015

 

2016

 

123 Westmead Road

Suwanee, GA

 

 

-

 

1,560

 

11,538

 

842

 

1,560

 

12,380

 

2,876

 

2012

 

2000

 

4315 Johns Creek Parkway

Sway, UKJ

 

 

-

 

4,145

 

15,508

 

2,094

 

4,596

 

17,151

 

2,722

 

2014

 

2008

 

Sway Place

Swift Current, SK

 

 

2,228

 

492

 

10,119

 

1,315

 

550

 

11,376

 

2,236

 

2013

 

2001

 

301 Macoun Drive

Tacoma, WA

 

 

17,760

 

2,400

 

35,053

 

584

 

2,459

 

35,579

 

7,107

 

2011

 

2008

 

7290 Rosemount Circle

Tacoma, WA

 

 

-

 

1,535

 

6,068

 

59

 

1,537

 

6,125

 

935

 

2015

 

2012

 

7290 Rosemount Circle

Tacoma, WA

 

 

-

 

4,170

 

73,377

 

8,824

 

4,170

 

82,201

 

6,113

 

2016

 

1987

 

8201 6th Avenue

Tampa, FL

 

 

69,330

 

4,910

 

114,148

 

3,636

 

4,962

 

117,732

 

15,060

 

2015

 

2001

 

12951 W Linebaugh Avenue

Tewksbury, MA

 

 

-

 

2,350

 

24,118

 

1,985

 

2,350

 

26,104

 

1,826

 

2016

 

2006

 

2000 Emerald Court

The Woodlands, TX

 

 

-

 

480

 

12,379

 

824

 

480

 

13,203

 

3,065

 

2011

 

1999

 

7950 Bay Branch Dr

Toledo, OH

 

 

-

 

2,040

 

47,129

 

3,358

 

2,144

 

50,383

 

13,525

 

2010

 

1985

 

3501 Executive Parkway

Toronto, ON

 

 

18,615

 

2,927

 

20,713

 

3,327

 

3,266

 

23,701

 

2,802

 

2015

 

1900

 

54 Foxbar Road

Toronto, ON

 

 

9,662

 

5,082

 

25,493

 

3,817

 

5,624

 

28,767

 

5,008

 

2015

 

1988

 

645 Castlefield Avenue

Toronto, ON

 

 

13,959

 

2,040

 

19,822

 

1,608

 

2,188

 

21,282

 

2,737

 

2015

 

1999

 

4251 Dundas Street West

Toronto, ON

 

 

40,768

 

5,132

 

41,657

 

7,208

 

5,674

 

48,322

 

9,699

 

2015

 

1964

 

10 William Morgan Drive

Toronto, ON

 

 

4,650

 

2,480

 

7,571

 

1,343

 

2,742

 

8,652

 

1,638

 

2015

 

1971

 

123 Spadina Road

Toronto, ON

 

 

1,439

 

1,079

 

5,364

 

844

 

1,193

 

6,094

 

1,170

 

2013

 

1982

 

25 Centennial Park Road

Toronto, ON

 

 

8,587

 

2,513

 

19,695

 

2,814

 

2,815

 

22,208

 

3,535

 

2013

 

2002

 

305 Balliol Street

Toronto, ON

 

 

19,525

 

3,400

 

32,757

 

4,524

 

3,764

 

36,917

 

7,504

 

2013

 

1973

 

1055 and 1057 Don Mills Road

Toronto, ON

 

 

962

 

1,361

 

2,915

 

667

 

1,528

 

3,415

 

1,139

 

2013

 

1985

 

3705 Bathurst Street

Toronto, ON

 

 

6,355

 

1,447

 

3,918

 

725

 

1,600

 

4,490

 

1,107

 

2013

 

1987

 

1340 York Mills Road

Toronto, ON

 

 

34,411

 

5,304

 

53,488

 

7,151

 

5,869

 

60,074

 

15,630

 

2013

 

1988

 

8 The Donway East

Torrance, CA

 

 

-

 

3,497

 

73,138

 

-

 

3,497

 

73,138

 

972

 

2016

 

2016

 

25525 Hawthorne Boulevard

Trumbull, CT

 

 

-

 

2,850

 

37,685

 

2,058

 

2,935

 

39,657

 

10,412

 

2011

 

1998

 

2750 Reservoir Avenue 

Tucson, AZ

 

 

4,436

 

830

 

6,179

 

3,732

 

913

 

9,827

 

1,801

 

2012

 

1997

 

5660 N. Kolb Road

Tulsa, OK

 

 

-

 

1,330

 

21,285

 

3,767

 

1,350

 

25,032

 

6,186

 

2010

 

1986

 

8887 South Lewis Ave

Tulsa, OK

 

 

-

 

1,500

 

20,861

 

3,455

 

1,581

 

24,235

 

6,334

 

2010

 

1984

 

9524 East 71st St

Tustin, CA

 

 

-

 

840

 

15,299

 

716

 

840

 

16,015

 

3,409

 

2011

 

1965

 

240 East 3rd St

Upland, CA

 

 

-

 

3,160

 

42,596

 

14

 

3,160

 

42,610

 

4,098

 

2015

 

2014

 

2419 North Euclid Avenue

Upper St Claire, PA

 

 

-

 

1,102

 

13,455

 

875

 

1,102

 

14,330

 

3,267

 

2013

 

2005

 

500 Village Drive

Vancouver, BC

 

 

-

 

7,934

 

6,875

 

-

 

7,934

 

6,875

 

5,704

 

2015

 

1974

 

2803 West 41st Avenue

Vankleek Hill, ON

 

 

943

 

389

 

2,960

 

553

 

436

 

3,466

 

784

 

2013

 

1987

 

48 Wall Street

Vaudreuil, QC

 

 

8,744

 

1,852

 

14,214

 

1,844

 

1,993

 

15,917

 

1,932

 

2015

 

1975

 

333 rue Querbes

Venice, FL

 

 

64,425

 

6,820

 

100,501

 

3,093

 

6,872

 

103,542

 

14,087

 

2015

 

2002

 

1000 Aston Gardens Drive

Vero Beach, FL

 

 

-

 

2,930

 

40,070

 

25,412

 

2,930

 

65,482

 

14,513

 

2007

 

2003

 

7955 16th Manor

Victoria, BC

 

 

7,752

 

2,856

 

18,038

 

2,502

 

3,157

 

20,238

 

4,544

 

2013

 

1974

 

3000 Shelbourne Street

Victoria, BC

 

 

7,147

 

3,681

 

15,774

 

2,273

 

4,070

 

17,658

 

4,125

 

2013

 

1988

 

3051 Shelbourne Street

Victoria, BC

 

 

8,015

 

2,476

 

15,379

 

2,591

 

2,741

 

17,705

 

1,829

 

2015

 

1990

 

3965 Shelbourne Street

Virginia Water, UKJ

 

 

-

 

7,106

 

29,937

 

6,182

 

5,943

 

37,281

 

7,286

 

2012

 

2002

 

Christ Church Road

Walnut Creek, CA

 

 

-

 

3,700

 

12,467

 

1,695

 

3,794

 

14,067

 

3,603

 

2013

 

1998

 

2175 Ygnacio Valley Road

Walnut Creek, CA

 

 

-

 

10,320

 

100,890

 

10,385

 

10,320

 

111,275

 

8,442

 

2016

 

1988

 

1580 Geary Road

Waltham, MA

 

 

-

 

2,462

 

40,062

 

1,355

 

2,536

 

41,344

 

5,437

 

2015

 

2000

 

126 Smith Street

Warwick, RI

 

 

-

 

2,400

 

24,635

 

2,407

 

2,407

 

27,036

 

7,952

 

2011

 

1998

 

75 Minnesota Avenue 

Washington, DC

 

 

30,841

 

4,000

 

69,154

 

2,023

 

4,002

 

71,175

 

12,670

 

2013

 

2004

 

5111 Connecticut Avenue NW

Waterbury, CT

 

 

-

 

2,460

 

39,547

 

3,283

 

2,495

 

42,795

 

13,963

 

2011

 

1998

 

180 Scott Road 

Wayland, MA

 

 

-

 

1,207

 

27,462

 

1,389

 

1,334

 

28,724

 

5,630

 

2013

 

1997

 

285 Commonwealth Road

Webster Groves, MO

 

 

-

 

1,790

 

15,425

 

2,152

 

1,790

 

17,577

 

3,197

 

2011

 

2012

 

45 E Lockwood Avenue

Welland, ON

 

 

6,858

 

983

 

7,530

 

691

 

1,055

 

8,149

 

954

 

2015

 

2006

 

110 First Street

Wellesley, MA

 

 

-

 

4,690

 

77,462

 

162

 

4,690

 

77,624

 

9,840

 

2015

 

2012

 

23 & 27 Washington Street

West Babylon, NY

 

 

-

 

3,960

 

47,085

 

1,759

 

3,960

 

48,844

 

8,199

 

2013

 

2003

 

580 Montauk Highway

West Bloomfield, MI

 

 

-

 

1,040

 

12,300

 

726

 

1,089

 

12,977

 

2,563

 

2013

 

2000

 

7005 Pontiac Trail

West Hills, CA

 

 

-

 

2,600

 

7,521

 

857

 

2,636

 

8,342

 

2,363

 

2013

 

2002

 

9012 Topanga Canyon Road

West Vancouver, BC

 

 

19,905

 

7,059

 

28,155

 

4,847

 

7,805

 

32,256

 

6,834

 

2013

 

1987

 

2095 Marine Drive

Westbourne, UKK

 

 

-

 

5,441

 

41,420

 

5,289

 

5,969

 

46,181

 

8,676

 

2013

 

2006

 

16-18 Poole Road

Westford, MA

 

 

-

 

1,440

 

32,607

 

148

 

1,468

 

32,727

 

3,329

 

2015

 

2013

 

108 Littleton Road

Weston, MA

 

 

-

 

1,160

 

6,200

 

1,240

 

1,160

 

7,440

 

1,285

 

2013

 

1998

 

135 North Avenue

Westworth Village, TX

 

 

-

 

2,060

 

31,296

 

56

 

2,060

 

31,352

 

2,523

 

2014

 

2014

 

25 Leonard Trail

Weybridge, UKJ

 

 

-

 

7,899

 

48,240

 

5,667

 

8,662

 

53,144

 

11,619

 

2013

 

2008

 

Ellesmere Road

Weymouth, UKK

 

 

-

 

2,591

 

16,551

 

1,912

 

2,879

 

18,174

 

1,712

 

2014

 

2013

 

Cross Road

White Oak, MD

 

 

-

 

2,304

 

24,768

 

1,747

 

2,316

 

26,503

 

4,644

 

2013

 

2002

 

11621 New Hampshire Avenue

Wilbraham, MA

 

 

-

 

660

 

17,639

 

931

 

685

 

18,544

 

4,515

 

2011

 

2000

 

2387 Boston Road 

Wilmington, DE

 

 

-

 

1,040

 

23,338

 

867

 

1,129

 

24,116

 

4,588

 

2013

 

2004

 

2215 Shipley Street

Winchester, UKJ

 

 

-

 

6,009

 

29,405

 

3,647

 

6,598

 

32,463

 

6,719

 

2012

 

2010

 

Stockbridge Road

Winnipeg, MB

 

 

13,446

 

1,960

 

38,612

 

5,818

 

2,225

 

44,164

 

12,378

 

2013

 

1999

 

857 Wilkes Avenue

Winnipeg, MB

 

 

16,833

 

1,276

 

21,732

 

3,031

 

1,466

 

24,572

 

4,643

 

2013

 

1988

 

3161 Grant Avenue

Winnipeg, MB

 

 

13,641

 

1,317

 

15,609

 

3,176

 

1,456

 

18,645

 

2,899

 

2015

 

1999

 

125 Portsmouth Boulevard

Woking, UKJ

 

 

-

 

3,172

 

13,233

 

-

 

3,172

 

13,233

 

-

 

2016

 

2017

 

12 Streets Heath, West End

Wolverhampton, UKG

 

 

-

 

2,941

 

8,922

 

1,363

 

3,232

 

9,994

 

2,856

 

2013

 

2008

 

73 Wergs Road

Woodbridge, CT

 

 

-

 

1,370

 

14,219

 

1,423

 

1,426

 

15,586

 

5,225

 

2011

 

1998

 

21 Bradley Road

Woodland Hills, CA

 

 

-

 

3,400

 

20,478

 

947

 

3,447

 

21,378

 

4,637

 

2013

 

2005

 

20461 Ventura Boulevard

Worcester, MA

 

 

-

 

1,140

 

21,664

 

1,057

 

1,166

 

22,695

 

5,493

 

2011

 

1999

 

340 May Street 

Yarmouth, ME

 

 

-

 

450

 

27,711

 

1,257

 

470

 

28,948

 

6,586

 

2011

 

1999

 

27 Forest Falls Drive

Yonkers, NY

 

 

-

 

3,962

 

50,107

 

1,419

 

3,967

 

51,521

 

9,381

 

2013

 

2005

 

65 Crisfield Street

Yorkton, SK

 

$

3,493

$

466

$

8,756

$

1,128

$

511

$

9,839

$

1,916

 

2013

 

2001

 

94 Russell Drive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Seniors housing operating total

 

$

1,988,700

$

1,174,980

$

12,626,419

$

1,234,180

$

1,246,991

$

13,788,584

$

2,362,335

 

 

 

 

 

 

99


  

 

  

100


  

Welltower Inc.

 

 

Schedule III

 

 

Real Estate and Accumulated Depreciation

 

 

December 31, 2017

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

Initial Cost to Company

 

 

 

Gross Amount at Which Carried at Close of Period

 

 

 

 

 

 

Description

 

 

Encumbrances

 

Land

 

Building & Improvements

 

Cost Capitalized Subsequent to Acquisition

 

Land

 

Building & Improvements

 

Accumulated Depreciation(1)

 

Year Acquired

 

Year Built

 

Address

Outpatient medical:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Akron, OH

 

$

-

$

821

$

12,105

$

-

$

821

$

12,105

$

2,528

 

2012

 

2010

 

701 White Pond Drive

Allen, TX

 

 

-

 

726

 

14,196

 

798

 

726

 

14,994

 

4,117

 

2012

 

2006

 

1105 N Central Expressway

Alpharetta, GA

 

 

-

 

476

 

14,757

 

323

 

476

 

15,081

 

4,456

 

2011

 

2003

 

11975 Morris Road

Alpharetta, GA

 

 

-

 

1,862

 

-

 

-

 

1,862

 

-

 

-

 

2011

 

1900

 

940 North Point Parkway

Alpharetta, GA

 

 

-

 

548

 

17,103

 

440

 

548

 

17,543

 

5,809

 

2011

 

2007

 

3300 Old Milton Parkway

Alpharetta, GA

 

 

-

 

773

 

18,902

 

1,259

 

773

 

20,161

 

5,652

 

2011

 

1993

 

3400-A Old Milton Parkway

Alpharetta, GA

 

 

-

 

1,769

 

36,152

 

784

 

1,769

 

36,936

 

11,834

 

2011

 

1999

 

3400-C Old Milton Parkway

Anderson, IN

 

 

-

 

1,193

 

20,644

 

-

 

1,193

 

20,644

 

562

 

2017

 

2016

 

3125 S. Scatterfield Rd.

Arcadia, CA

 

 

-

 

5,408

 

23,219

 

4,058

 

5,618

 

27,067

 

9,859

 

2006

 

1984

 

301 W. Huntington Drive

Arlington, TX

 

 

-

 

82

 

18,243

 

374

 

82

 

18,617

 

2,796

 

2012

 

2012

 

902 W. Randol Mill Road

Atlanta, GA

 

 

-

 

4,931

 

18,720

 

6,731

 

5,387

 

24,996

 

10,420

 

2006

 

1991

 

755 Mt. Vernon Hwy.

Atlanta, GA

 

 

-

 

1,947

 

24,248

 

1,681

 

2,030

 

25,845

 

6,803

 

2012

 

1984

 

975 Johnson Ferry Road

Atlanta, GA

 

 

-

 

-

 

43,425

 

1,098

 

-

 

44,523

 

11,603

 

2012

 

2006

 

5670 Peachtree-Dunwoody Road

Austin, TX

 

 

-

 

1,066

 

10,112

 

-

 

1,066

 

10,112

 

71

 

2017

 

2017

 

5301-B Davis Lane

Bardstown, KY

 

 

-

 

273

 

7,966

 

42

 

274

 

8,007

 

984

 

2010

 

2006

 

4359 New Shepherdsville Rd

Bartlett, TN

 

 

-

 

187

 

15,015

 

2,042

 

187

 

17,057

 

6,305

 

2007

 

2004

 

2996 Kate Bond Rd.

Bel Air, MD

 

 

-

 

-

 

24,769

 

-

 

-

 

24,769

 

1,069

 

2014

 

2016

 

12 Medstar Boulevard

Bellevue, NE

 

 

-

 

-

 

16,680

 

2

 

-

 

16,682

 

4,658

 

2010

 

2010

 

2510 Bellevue Medical Center Drive

Bettendorf, IA

 

 

-

 

-

 

7,110

 

73

 

-

 

7,183

 

569

 

2013

 

2014

 

2140 53rd Avenue

Beverly Hills, CA

 

 

-

 

20,766

 

40,730

 

1,871

 

20,766

 

42,601

 

4,352

 

2015

 

1946

 

9675 Brighton Way

Beverly Hills, CA

 

 

-

 

18,863

 

1,192

 

187

 

18,863

 

1,379

 

513

 

2015

 

1955

 

415 North Bedford

Beverly Hills, CA

 

 

-

 

19,863

 

31,690

 

315

 

19,863

 

32,005

 

3,514

 

2015

 

1946

 

416 North Bedford

Beverly Hills, CA

 

 

33,729

 

32,603

 

28,639

 

493

 

32,603

 

29,132

 

4,117

 

2015

 

1950

 

435 North Bedford

Beverly Hills, CA

 

 

78,271

 

52,772

 

87,366

 

-

 

52,772

 

87,366

 

8,731

 

2015

 

1989

 

436 North Bedford

Birmingham, AL

 

 

-

 

52

 

10,201

 

626

 

52

 

10,827

 

3,863

 

2006

 

1971

 

801 Princeton Avenue SW

Birmingham, AL

 

 

-

 

124

 

11,733

 

1,949

 

124

 

13,682

 

4,512

 

2006

 

1985

 

817 Princeton Avenue SW

Birmingham, AL

 

 

-

 

476

 

18,726

 

2,006

 

476

 

20,731

 

7,398

 

2006

 

1989

 

833 Princeton Avenue SW

Boardman, OH

 

 

-

 

80

 

12,161

 

10

 

80

 

12,170

 

4,225

 

2010

 

2007

 

8423 Market St

Boca Raton, FL

 

 

-

 

31

 

12,312

 

430

 

59

 

12,714

 

3,103

 

2012

 

1993

 

9960 S. Central Park Boulevard

Boca Raton, FL

 

 

-

 

109

 

34,002

 

3,261

 

214

 

37,158

 

13,169

 

2006

 

1995

 

9970 S. Central Park Blvd.

Boerne, TX

 

 

-

 

50

 

12,951

 

-

 

50

 

12,951

 

3,100

 

2011

 

2007

 

134 Menger Springs Road

Boynton Beach, FL

 

 

-

 

2,048

 

7,692

 

984

 

2,185

 

8,539

 

3,507

 

2006

 

1995

 

8188 Jog Rd.

Boynton Beach, FL

 

 

-

 

2,048

 

7,403

 

1,576

 

2,185

 

8,841

 

3,640

 

2006

 

1997

 

8200 Jog Road

Boynton Beach, FL

 

 

-

 

214

 

5,611

 

8,340

 

270

 

13,895

 

5,191

 

2007

 

1996

 

10075 Jog Rd.

Boynton Beach, FL

 

 

-

 

13,324

 

40,369

 

2,681

 

14,030

 

42,344

 

9,445

 

2013

 

1995

 

10301 Hagen Ranch Road

Bradenton, FL

 

 

-

 

1,184

 

9,799

 

417

 

1,184

 

10,216

 

1,454

 

2014

 

1975

 

315 75th Street West

Bradenton, FL

 

 

-

 

1,035

 

4,298

 

-

 

1,035

 

4,298

 

694

 

2014

 

2006

 

7005 Cortez Road West

Bridgeton, MO

 

 

-

 

1,701

 

6,228

 

-

 

1,701

 

6,228

 

296

 

2017

 

2008

 

3440 De Paul Ln.

Bridgeton, MO

 

 

-

 

450

 

21,221

 

188

 

450

 

21,409

 

6,149

 

2010

 

2006

 

12266 DePaul Dr

Buckhurst Hill, UKH

 

 

-

 

12,717

 

54,001

 

-

 

12,717

 

54,001

 

3,832

 

2015

 

2013

 

High Road

Burleson, TX

 

 

-

 

10

 

12,611

 

698

 

10

 

13,309

 

3,599

 

2011

 

2007

 

12001 South Freeway

Burnsville, MN

 

 

-

 

-

 

31,596

 

568

 

-

 

32,164

 

6,446

 

2013

 

2014

 

14101 Fairview Dr

Carmel, IN

 

 

-

 

2,280

 

19,238

 

649

 

2,280

 

19,886

 

6,935

 

2011

 

2005

 

12188-A North Meridian Street

Carmel, IN

 

 

-

 

2,026

 

21,559

 

26

 

2,026

 

21,586

 

7,913

 

2011

 

2007

 

12188-B North Meridian Street

Castle Rock, CO

 

 

-

 

80

 

13,004

 

571

 

79

 

13,576

 

2,347

 

2014

 

2013

 

2352 Meadows Boulevard

Castle Rock, CO

 

 

-

 

-

 

11,795

 

-

 

-

 

11,795

 

217

 

2016

 

2017

 

Meadows Boulevard

Cedar Park, TX

 

 

-

 

132

 

20,701

 

-

 

132

 

20,701

 

910

 

2017

 

2014

 

1401 Medical Parkway, Building 2

Charleston, SC

 

 

-

 

2,773

 

25,928

 

94

 

2,815

 

25,980

 

3,950

 

2014

 

2009

 

325 Folly Road

Cincinnati, OH

 

 

-

 

-

 

17,880

 

203

 

2

 

18,080

 

2,853

 

2012

 

2013

 

3301 Mercy Health Boulevard

Claremore, OK

 

 

-

 

132

 

11,173

 

-

 

132

 

11,173

 

3,009

 

2007

 

2005

 

1501 N. Florence Ave.

Clarkson Valley, MO

 

 

-

 

-

 

35,592

 

-

 

-

 

35,592

 

11,095

 

2009

 

2010

 

15945 Clayton Rd

Clear Lake, TX

 

 

-

 

-

 

13,882

 

-

 

-

 

13,882

 

1,157

 

2013

 

2014

 

1010 South Ponds Drive

Columbia, MD

 

 

-

 

2,333

 

19,232

 

867

 

2,333

 

20,098

 

4,106

 

2012

 

2002

 

10700 Charter Drive

Columbia, MD

 

 

-

 

23

 

33,885

 

1,417

 

9,353

 

25,972

 

4,616

 

2015

 

1982

 

5450 & 5500 Knoll N Dr.

Coon Rapids, MN

 

 

-

 

-

 

26,679

 

1,119

 

-

 

27,798

 

4,240

 

2013

 

2014

 

11850 Blackfoot Street NW

Costa Mesa, CA

 

 

22,748

 

22,033

 

24,332

 

-

 

22,033

 

24,332

 

1,376

 

2017

 

2007

 

1640 Newport Boulevard

Cypress, TX

 

 

-

 

1,287

 

-

 

-

 

1,287

 

-

 

-

 

2016

 

1900

 

14940 Mueschke Road

Cypress, TX

 

 

-

 

2,985

 

-

 

-

 

2,985

 

-

 

-

 

2016

 

1900

 

13105 Wortham Center Drive

Dade City, FL

 

 

-

 

1,211

 

5,511

 

-

 

1,211

 

5,511

 

1,277

 

2011

 

1998

 

13413 US Hwy 301

Dallas, TX

 

 

-

 

122

 

15,419

 

-

 

122

 

15,419

 

1,051

 

2013

 

2014

 

8196 Walnut Hill Lane

Dallas, TX

 

 

-

 

137

 

28,690

 

3,624

 

137

 

32,315

 

12,204

 

2006

 

1995

 

9330 Poppy Dr.

Dallas, TX

 

 

-

 

462

 

52,488

 

225

 

462

 

52,714

 

9,869

 

2012

 

2004

 

7115 Greenville Avenue

Dayton, OH

 

 

-

 

730

 

6,919

 

362

 

730

 

7,281

 

2,591

 

2011

 

1988

 

1530 Needmore Road

Deerfield Beach, FL

 

 

-

 

2,408

 

7,809

 

417

 

2,540

 

8,094

 

3,104

 

2011

 

2001

 

1192 East Newport Center Drive

Delray Beach, FL

 

 

-

 

1,882

 

34,767

 

6,895

 

2,449

 

41,094

 

17,406

 

2006

 

1985

 

5130-5150 Linton Blvd.

Durham, NC

 

 

-

 

1,212

 

22,858

 

1

 

1,212

 

22,859

 

3,166

 

2013

 

2012

 

1823 Hillandale Road

Edina, MN

 

 

-

 

310

 

15,132

 

945

 

310

 

16,077

 

4,346

 

2010

 

2003

 

8100 W 78th St

El Paso, TX

 

 

-

 

677

 

17,075

 

2,249

 

677

 

19,324

 

8,236

 

2006

 

1997

 

2400 Trawood Dr.

Everett, WA

 

 

-

 

4,842

 

26,010

 

-

 

4,842

 

26,010

 

6,630

 

2010

 

2011

 

13020 Meridian Ave. S.

Fenton, MO

 

 

10,919

 

958

 

27,485

 

714

 

958

 

28,199

 

6,192

 

2013

 

2009

 

1011 Bowles Avenue

Fenton, MO

 

 

-

 

369

 

13,911

 

104

 

369

 

14,016

 

2,226

 

2013

 

2009

 

1055 Bowles Avenue

Florham Park, NJ

 

 

-

 

8,578

 

61,779

 

-

 

8,578

 

61,779

 

-

 

2017

 

2017

 

150 Park Avenue

Flower Mound, TX

 

 

-

 

737

 

9,277

 

-

 

737

 

9,277

 

1,075

 

2015

 

2014

 

2560 Central Park Avenue

Flower Mound, TX

 

 

-

 

4,164

 

27,027

 

-

 

4,164

 

27,027

 

3,751

 

2014

 

2012

 

4370 Medical Arts Drive

Flower Mound, TX

 

 

-

 

4,620

 

-

 

-

 

4,620

 

-

 

-

 

2014

 

1900

 

Medical Arts Drive

Fort Wayne, IN

 

 

-

 

1,105

 

22,836

 

-

 

1,105

 

22,836

 

4,515

 

2012

 

2004

 

7916 Jefferson Boulevard

Fort Worth, TX

 

 

-

 

462

 

26,020

 

358

 

462

 

26,378

 

4,027

 

2012

 

2012

 

10840 Texas Health Trail

Fort Worth, TX

 

 

-

 

401

 

6,099

 

-

 

401

 

6,099

 

933

 

2014

 

2007

 

7200 Oakmont Boulevard

Franklin, TN

 

 

-

 

2,338

 

12,138

 

2,560

 

2,338

 

14,699

 

5,518

 

2007

 

1988

 

100 Covey Drive

Frisco, TX

 

 

-

 

-

 

18,635

 

1,476

 

-

 

20,111

 

7,141

 

2007

 

2004

 

4401 Coit Road

Frisco, TX

 

 

-

 

-

 

15,309

 

2,537

 

-

 

17,846

 

6,838

 

2007

 

2004

 

4461 Coit Road

Fullerton, CA

 

 

-

 

5,477

 

53,890

 

-

 

5,477

 

53,890

 

1,929

 

2014

 

2007

 

1950 Sunny Crest Drive

Gallatin, TN

 

 

-

 

20

 

21,801

 

1,729

 

44

 

23,506

 

6,998

 

2010

 

1997

 

300 Steam Plant Rd

Gig Harbor, WA

 

 

-

 

80

 

30,810

 

-

 

80

 

30,810

 

2,712

 

2010

 

2009

 

11511 Canterwood Blvd. NW

Glendale, CA

 

 

-

 

37

 

18,398

 

1,455

 

37

 

19,853

 

6,341

 

2007

 

2002

 

222 W. Eulalia St.

Grand Prairie, TX

 

 

-

 

981

 

6,086

 

-

 

981

 

6,086

 

1,793

 

2012

 

2009

 

2740 N State Hwy 360

Grapevine, TX

 

 

-

 

-

 

5,943

 

4,778

 

2,081

 

8,640

 

1,203

 

2014

 

2002

 

2040 W State Hwy 114

Grapevine, TX

 

 

-

 

3,365

 

15,669

 

30

 

3,365

 

15,699

 

3,256

 

2014

 

2002

 

2020 W State Hwy 114

Greeneville, TN

 

 

-

 

970

 

10,104

 

73

 

970

 

10,178

 

3,387

 

2010

 

2005

 

438 East Vann Rd

Greenwood, IN

 

 

-

 

8,316

 

26,384

 

-

 

8,316

 

26,384

 

5,821

 

2012

 

2010

 

1260 Innovation Parkway

Greenwood, IN

 

 

-

 

2,098

 

21,538

 

638

 

2,098

 

22,176

 

2,579

 

2014

 

2013

 

3000 S State Road 135

Greenwood, IN

 

 

-

 

1,262

 

7,045

 

8

 

1,262

 

7,053

 

1,226

 

2014

 

2010

 

333 E County Line Road

High Point, NC

 

 

-

 

2,659

 

29,069

 

122

 

2,659

 

29,191

 

5,515

 

2012

 

2010

 

4515 Premier Drive

Highland, IL

 

 

-

 

-

 

8,834

 

-

 

-

 

8,834

 

1,298

 

2012

 

2013

 

12860 Troxler Avenue

Houston, TX

 

 

-

 

10,403

 

-

 

-

 

10,403

 

-

 

5

 

2011

 

1900

 

F.M. 1960 & Northgate Forest Dr.

Houston, TX

 

 

-

 

5,837

 

33,128

 

150

 

5,837

 

33,278

 

9,728

 

2012

 

2005

 

15655 Cypress Woods Medical Dr.

Houston, TX

 

 

-

 

3,102

 

32,323

 

2,497

 

3,242

 

34,680

 

5,775

 

2014

 

2014

 

1900 N Loop W Freeway

Houston, TX

 

 

-

 

3,688

 

13,313

 

116

 

3,688

 

13,430

 

2,910

 

2012

 

2007

 

10701 Vintage Preserve Parkway

Houston, TX

 

 

-

 

1,099

 

1,604

 

78,408

 

12,815

 

68,296

 

11,702

 

2012

 

1998

 

2727 W Holcombe Boulevard

Howell, MI

 

 

-

 

2,000

 

13,928

 

-

 

2,000

 

13,928

 

158

 

2016

 

2017

 

1225 South Latson Road

Hudson, OH

 

 

-

 

2,587

 

13,720

 

672

 

2,868

 

14,111

 

4,157

 

2012

 

2006

 

5655 Hudson Drive

Humble, TX

 

 

-

 

-

 

9,941

 

-

 

-

 

9,941

 

787

 

2013

 

2014

 

8233 N. Sam Houston Parkway E.

Jackson, MI

 

 

-

 

607

 

17,367

 

123

 

668

 

17,429

 

3,709

 

2013

 

2009

 

1201 E Michigan Avenue

Jupiter, FL

 

 

-

 

2,252

 

11,415

 

3,397

 

2,608

 

14,456

 

4,941

 

2006

 

2001

 

550 Heritage Dr.

Jupiter, FL

 

 

-

 

2,825

 

5,858

 

863

 

3,005

 

6,540

 

2,807

 

2007

 

2004

 

600 Heritage Dr.

Killeen, TX

 

 

-

 

760

 

22,878

 

127

 

795

 

22,970

 

7,008

 

2010

 

2010

 

2405 Clear Creek Rd

Killeen, TX

 

 

-

 

1,907

 

3,575

 

-

 

1,907

 

3,575

 

477

 

2011

 

2012

 

5702 E Central Texas Expressway

Kyle, TX

 

 

-

 

2,569

 

14,384

 

466

 

2,569

 

14,850

 

2,321

 

2014

 

2011

 

135 Bunton Creek Road

La Jolla, CA

 

 

-

 

12,855

 

32,658

 

168

 

12,855

 

32,826

 

4,500

 

2015

 

1989

 

4150 Regents Park Row

La Jolla, CA

 

 

-

 

9,425

 

26,525

 

-

 

9,425

 

26,525

 

2,814

 

2015

 

1988

 

4120 & 4130 La Jolla Village Drive

La Quinta, CA

 

 

-

 

3,266

 

22,066

 

194

 

3,279

 

22,247

 

3,785

 

2014

 

2006

 

47647 Caleo Bay Drive

Lake St Louis, MO

 

 

-

 

240

 

14,249

 

192

 

240

 

14,441

 

4,499

 

2010

 

2008

 

400 Medical Dr

Lakeway, TX

 

 

-

 

2,801

 

-

 

-

 

2,801

 

-

 

-

 

2007

 

1900

 

Lohmans Crossing Road

Lakewood, CA

 

 

-

 

146

 

14,885

 

2,291

 

146

 

17,176

 

5,902

 

2006

 

1993

 

5750 Downey Ave.

Lakewood, WA

 

 

-

 

72

 

16,017

 

675

 

72

 

16,693

 

3,256

 

2012

 

2005

 

11307 Bridgeport Way SW

Land O Lakes, FL

 

 

-

 

3,025

 

26,249

 

-

 

3,025

 

26,249

 

157

 

2017

 

2009

 

2100 Via Bella

Land O Lakes, FL

 

 

-

 

1,376

 

6,750

 

-

 

1,376

 

6,750

 

45

 

2017

 

2011

 

2150 Via Bella

Las Vegas, NV

 

 

-

 

6,127

 

-

 

-

 

6,127

 

-

 

-

 

2007

 

1900

 

SW corner of Deer Springs Way and Riley Street

Las Vegas, NV

 

 

-

 

2,319

 

4,612

 

1,039

 

2,319

 

5,651

 

2,478

 

2006

 

1991

 

2870 S. Maryland Pkwy.

Las Vegas, NV

 

 

-

 

74

 

15,287

 

1,351

 

74

 

16,638

 

5,930

 

2006

 

2000

 

1815 E. Lake Mead Blvd.

Las Vegas, NV

 

 

-

 

433

 

6,921

 

214

 

433

 

7,135

 

3,022

 

2007

 

1997

 

1776 E. Warm Springs Rd.

Lenexa, KS

 

 

-

 

540

 

17,926

 

290

 

540

 

18,216

 

4,676

 

2010

 

2008

 

23401 Prairie Star Pkwy

Lenexa, KS

 

 

-

 

100

 

13,767

 

-

 

100

 

13,767

 

1,353

 

2013

 

2013

 

23351 Prairie Star Parkway

Lincoln, NE

 

 

-

 

1,420

 

29,723

 

422

 

1,420

 

30,145

 

9,862

 

2010

 

2003

 

575 South 70th St

London, UKI

 

 

-

 

5,547

 

12,253

 

-

 

5,547

 

12,253

 

869

 

2015

 

2007

 

17-19 View Road

London, UKI

 

 

-

 

19,076

 

167,391

 

-

 

19,076

 

167,391

 

11,878

 

2015

 

2010

 

53 Parkside

London, UKI

 

 

-

 

4,329

 

29,815

 

-

 

4,329

 

29,815

 

2,116

 

2015

 

2003

 

49 Parkside

Los Alamitos, CA

 

 

-

 

39

 

18,635

 

1,085

 

39

 

19,720

 

6,792

 

2007

 

2003

 

3771 Katella Ave.

Los Gatos, CA

 

 

-

 

488

 

22,386

 

2,354

 

488

 

24,739

 

10,115

 

2006

 

1993

 

555 Knowles Dr.

Loxahatchee, FL

 

 

-

 

1,637

 

5,048

 

1,063

 

1,719

 

6,029

 

2,484

 

2006

 

1997

 

12977 Southern Blvd.

Loxahatchee, FL

 

 

-

 

1,340

 

6,509

 

1,252

 

1,440

 

7,662

 

2,853

 

2006

 

1993

 

12989 Southern Blvd.

Loxahatchee, FL

 

 

-

 

1,553

 

4,694

 

1,369

 

1,650

 

5,966

 

2,358

 

2006

 

1994

 

12983 Southern Blvd.

Marietta, GA

 

 

-

 

2,682

 

20,053

 

1,392

 

2,682

 

21,446

 

1,010

 

2016

 

2016

 

4800 Olde Towne Parkway

Melbourne, FL

 

 

-

 

3,439

 

50,461

 

420

 

3,538

 

50,783

 

7,147

 

2014

 

2009

 

2222 South Harbor City Boulevard

Menasha, WI

 

 

-

 

1,374

 

13,861

 

3,074

 

1,345

 

16,964

 

1,364

 

2016

 

1994

 

1550 Midway Place

Merced, CA

 

 

-

 

-

 

13,772

 

814

 

-

 

14,586

 

4,436

 

2009

 

2010

 

315 Mercy Ave.

Merriam, KS

 

 

-

 

176

 

8,005

 

304

 

176

 

8,309

 

2,898

 

2011

 

1972

 

8800 West 75th Street

Merriam, KS

 

 

-

 

-

 

1,996

 

2,184

 

81

 

4,099

 

1,508

 

2011

 

1980

 

7301 Frontage Street

Merriam, KS

 

 

-

 

-

 

10,222

 

4,510

 

444

 

14,287

 

4,793

 

2011

 

1977

 

8901 West 74th Street

Merriam, KS

 

 

-

 

-

 

5,862

 

3,163

 

182

 

8,842

 

2,960

 

2011

 

1985

 

9119 West 74th Street

Merriam, KS

 

 

-

 

1,257

 

24,911

 

-

 

1,257

 

24,911

 

4,881

 

2013

 

2009

 

9301 West 74th Street

Merrillville, IN

 

 

-

 

-

 

22,134

 

890

 

-

 

23,024

 

6,471

 

2008

 

2006

 

101 E. 87th Ave.

Mesa, AZ

 

 

-

 

1,558

 

9,561

 

739

 

1,558

 

10,300

 

4,396

 

2008

 

1989

 

6424 East Broadway Road

Mesquite, TX

 

 

-

 

496

 

3,834

 

-

 

496

 

3,834

 

867

 

2012

 

2012

 

1575 I-30

Mission Hills, CA

 

 

24,325

 

-

 

42,276

 

5,777

 

4,791

 

43,262

 

6,715

 

2014

 

1986

 

11550 Indian Hills Road

Missouri City, TX

 

 

-

 

1,360

 

7,146

 

-

 

1,360

 

7,146

 

238

 

2015

 

2016

 

7010 Highway 6

Moline, IL

 

 

-

 

-

 

8,783

 

29

 

-

 

8,812

 

947

 

2012

 

2013

 

3900 28th Avenue Drive

Monticello, MN

 

 

7,526

 

61

 

18,489

 

48

 

61

 

18,537

 

3,317

 

2012

 

2008

 

1001 Hart Boulevard

Moorestown, NJ

 

 

-

 

6

 

50,896

 

147

 

147

 

50,902

 

10,435

 

2011

 

2012

 

401  Young Avenue

Morrow, GA

 

 

-

 

818

 

8,064

 

234

 

845

 

8,270

 

4,063

 

2007

 

1990

 

6635 Lake Drive

Mount Juliet, TN

 

 

-

 

1,566

 

11,697

 

1,434

 

1,566

 

13,131

 

5,153

 

2007

 

2005

 

5002 Crossings Circle

Mount Vernon, IL

 

 

-

 

-

 

24,892

 

-

 

-

 

24,892

 

5,282

 

2011

 

2012

 

2 Good Samaritan Way

Murrieta, CA

 

 

-

 

3,800

 

-

 

-

 

3,800

 

-

 

-

 

2014

 

1900

 

28078 Baxter Rd.

Murrieta, CA

 

 

-

 

-

 

47,190

 

46

 

-

 

47,236

 

15,692

 

2010

 

2011

 

28078 Baxter Rd.

Nashville, TN

 

 

-

 

1,806

 

7,165

 

3,234

 

1,942

 

10,263

 

3,951

 

2006

 

1986

 

310 25th Ave. N.

Nassau Bay, TX

 

 

-

 

378

 

31,206

 

168

 

378

 

31,374

 

7,866

 

2012

 

1981

 

18100 St John Drive

Nassau Bay, TX

 

 

-

 

91

 

10,613

 

1,282

 

91

 

11,894

 

3,369

 

2012

 

1986

 

2060 Space Park Drive

New Albany, IN

 

 

-

 

2,411

 

16,494

 

30

 

2,411

 

16,524

 

2,318

 

2014

 

2001

 

2210 Green Valley Road

Niagara Falls, NY

 

 

-

 

1,433

 

10,891

 

435

 

1,721

 

11,037

 

5,311

 

2007

 

1995

 

6932 - 6934 Williams Rd

Niagara Falls, NY

 

 

-

 

454

 

8,362

 

307

 

454

 

8,669

 

2,967

 

2007

 

2004

 

6930 Williams Rd

Oklahoma City, OK

 

 

-

 

216

 

19,135

 

378

 

216

 

19,513

 

4,392

 

2013

 

2008

 

535 NW 9th Street

Oro Valley, AZ

 

 

-

 

89

 

18,339

 

969

 

89

 

19,308

 

6,489

 

2007

 

2004

 

1521 East Tangerine Rd.

Palmer, AK

 

 

-

 

217

 

29,705

 

1,333

 

217

 

31,038

 

10,170

 

2007

 

2006

 

2490 South Woodworth Loop

Pasadena, TX

 

 

-

 

1,700

 

8,009

 

-

 

1,700

 

8,009

 

902

 

2012

 

2013

 

5001 E Sam Houston Parkway S

Pearland, TX

 

 

-

 

1,500

 

11,253

 

-

 

1,500

 

11,253

 

1,175

 

2012

 

2013

 

2515 Business Center Drive

Pearland, TX

 

 

-

 

9,594

 

32,753

 

191

 

9,807

 

32,731

 

3,801

 

2014

 

2013

 

11511 Shadow Creek Parkway

Pendleton, OR

 

 

-

 

-

 

10,312

 

43

 

-

 

10,355

 

1,076

 

2012

 

2013

 

3001 St. Anthony Way

Phoenix, AZ

 

 

-

 

1,149

 

48,018

 

11,667

 

1,149

 

59,685

 

23,017

 

2006

 

1998

 

2222 E. Highland Ave.

Pineville, NC

 

 

-

 

961

 

6,974

 

2,504

 

1,077

 

9,362

 

4,180

 

2006

 

1988

 

10512 Park Rd.

Plano, TX

 

 

-

 

5,423

 

20,698

 

138

 

5,423

 

20,836

 

11,412

 

2008

 

2007

 

6957 Plano Parkway

Plano, TX

 

 

-

 

793

 

83,209

 

1,356

 

793

 

84,566

 

18,638

 

2012

 

2005

 

6020 West Parker Road

Plantation, FL

 

 

-

 

8,563

 

10,666

 

4,269

 

8,575

 

14,923

 

7,044

 

2006

 

1997

 

851-865 SW 78th Ave.

Plantation, FL

 

 

-

 

8,848

 

9,262

 

893

 

8,908

 

10,095

 

6,498

 

2006

 

1996

 

600 Pine Island Rd.

Portland, ME

 

 

-

 

655

 

25,930

 

13

 

655

 

25,943

 

7,307

 

2011

 

2008

 

195 Fore River Parkway

Redmond, WA

 

 

-

 

5,015

 

26,697

 

876

 

5,015

 

27,573

 

7,241

 

2010

 

2011

 

18000 NE Union Hill Rd.

Reno, NV

 

 

-

 

1,117

 

21,972

 

2,056

 

1,117

 

24,028

 

8,627

 

2006

 

1991

 

343 Elm St.

Richmond, TX

 

 

-

 

2,000

 

9,118

 

-

 

2,000

 

9,118

 

399

 

2015

 

2016

 

22121 FM 1093 Road

Richmond, VA

 

 

-

 

2,969

 

26,697

 

630

 

3,004

 

27,291

 

7,440

 

2012

 

2008

 

7001 Forest Avenue

Rockwall, TX

 

 

-

 

132

 

17,197

 

527

 

132

 

17,723

 

4,142

 

2012

 

2008

 

3142 Horizon Road

Rogers, AR

 

 

-

 

1,062

 

28,680

 

2,004

 

1,062

 

30,684

 

9,017

 

2011

 

2008

 

2708 Rife Medical Lane

Rolla, MO

 

 

-

 

1,931

 

47,639

 

-

 

1,931

 

47,639

 

11,144

 

2011

 

2009

 

1605 Martin Spring Drive

Roswell, NM

 

 

-

 

183

 

5,851

 

-

 

183

 

5,851

 

1,619

 

2011

 

2004

 

601 West Country Club Road

Roswell, NM

 

 

-

 

883

 

15,984

 

18

 

883

 

16,002

 

3,974

 

2011

 

2006

 

350 West Country Club Road

Roswell, NM

 

 

-

 

762

 

17,171

 

1

 

762

 

17,171

 

3,499

 

2011

 

2009

 

300 West Country Club Road

Sacramento, CA

 

 

-

 

866

 

12,756

 

1,737

 

869

 

14,490

 

5,359

 

2006

 

1990

 

8120 Timberlake Way

Salem, NH

 

 

-

 

1,655

 

14,050

 

20

 

1,655

 

14,070

 

2,381

 

2014

 

2013

 

31 Stiles Road

San Antonio, TX

 

 

-

 

1,048

 

10,252

 

-

 

1,048

 

10,252

 

4,636

 

2006

 

1999

 

19016 Stone Oak Pkwy.

San Antonio, TX

 

 

-

 

1,038

 

9,173

 

1,853

 

1,074

 

10,990

 

5,151

 

2006

 

1999

 

540 Stone Oak Centre Drive

San Antonio, TX

 

 

-

 

4,518

 

31,041

 

3,353

 

4,548

 

34,364

 

9,138

 

2012

 

1986

 

5282 Medical Drive

San Antonio, TX

 

 

-

 

900

 

17,288

 

620

 

900

 

17,907

 

3,636

 

2014

 

2007

 

3903 Wiseman Boulevard

Santa Clarita, CA

 

 

-

 

-

 

2,338

 

20,063

 

5,218

 

17,183

 

2,505

 

2014

 

1976

 

23861 McBean Parkway

Santa Clarita, CA

 

 

-

 

-

 

28,384

 

1,499

 

5,250

 

24,633

 

3,534

 

2014

 

1998

 

23929 McBean Parkway

Santa Clarita, CA

 

 

-

 

278

 

185

 

11,595

 

11,872

 

185

 

123

 

2014

 

1996

 

23871 McBean Parkway

Santa Clarita, CA

 

 

25,000

 

295

 

40,257

 

-

 

295

 

40,257

 

3,964

 

2014

 

2013

 

23803 McBean Parkway

Santa Clarita, CA

 

 

-

 

-

 

20,618

 

718

 

4,407

 

16,929

 

2,615

 

2014

 

1989

 

24355 Lyons Avenue

Sarasota, FL

 

 

-

 

62

 

47,325

 

3,134

 

62

 

50,459

 

11,273

 

2012

 

1990

 

1921 Waldemere Street

Seattle, WA

 

 

-

 

4,410

 

38,428

 

392

 

4,410

 

38,820

 

13,671

 

2010

 

2010

 

5350 Tallman Ave

Sewell, NJ

 

 

-

 

60

 

57,929

 

683

 

164

 

58,508

 

21,485

 

2007

 

2009

 

239 Hurffville-Cross Keys Road

Shakopee, MN

 

 

5,900

 

508

 

11,412

 

391

 

509

 

11,802

 

3,714

 

2010

 

1996

 

1515 St Francis Ave

Shakopee, MN

 

 

9,964

 

707

 

18,089

 

78

 

773

 

18,102

 

4,421

 

2010

 

2007

 

1601 St Francis Ave

Shenandoah, TX

 

 

-

 

-

 

21,135

 

51

 

24

 

21,162

 

1,586

 

2013

 

2014

 

106 Vision Park Boulevard

Sherman Oaks, CA

 

 

-

 

-

 

32,186

 

2,729

 

3,121

 

31,795

 

4,762

 

2014

 

1969

 

4955 Van Nuys Boulevard

Somerville, NJ

 

 

-

 

3,400

 

22,244

 

2

 

3,400

 

22,246

 

5,237

 

2008

 

2007

 

30 Rehill Avenue

Southlake, TX

 

 

-

 

3,000

 

-

 

-

 

3,000

 

-

 

-

 

2014

 

1900

 

Central Avenue

Southlake, TX

 

 

-

 

592

 

18,243

 

1,101

 

592

 

19,344

 

4,305

 

2012

 

2004

 

1545 East Southlake Boulevard

Southlake, TX

 

 

-

 

698

 

30,549

 

3,915

 

698

 

34,464

 

6,472

 

2012

 

2004

 

1545 East Southlake Boulevard

Springfield, IL

 

 

-

 

1,569

 

10,350

 

-

 

1,568

 

10,351

 

852

 

2010

 

2011

 

1100 East Lincolnshire Blvd

Springfield, IL

 

 

-

 

177

 

3,519

 

31

 

177

 

3,551

 

300

 

2010

 

2011

 

2801 Mathers Rd.

St Paul, MN

 

 

-

 

49

 

37,695

 

402

 

49

 

38,096

 

4,007

 

2014

 

2006

 

225 Smith Avenue N.

St. Louis, MO

 

 

-

 

336

 

17,247

 

2,004

 

336

 

19,250

 

6,769

 

2007

 

2001

 

2325 Dougherty Rd.

St. Paul, MN

 

 

-

 

2,706

 

39,507

 

325

 

2,701

 

39,838

 

10,622

 

2011

 

2007

 

435 Phalen Boulevard

Stamford, CT

 

 

-

 

-

 

41,153

 

1,709

 

-

 

42,862

 

1,176

 

2015

 

2016

 

29 Hospital Plaza

Suffern, NY

 

 

-

 

653

 

37,255

 

183

 

696

 

37,394

 

10,155

 

2011

 

2007

 

257 Lafayette Avenue

Suffolk, VA

 

 

-

 

1,566

 

11,511

 

219

 

1,620

 

11,676

 

4,328

 

2010

 

2007

 

5838 Harbour View Blvd.

Sugar Land, TX

 

 

-

 

3,543

 

15,532

 

-

 

3,543

 

15,532

 

4,408

 

2012

 

2005

 

11555 University Boulevard

Tacoma, WA

 

 

-

 

-

 

64,307

 

-

 

-

 

64,307

 

14,457

 

2011

 

2013

 

1608 South J Street

Tallahassee, FL

 

 

-

 

-

 

17,449

 

-

 

-

 

17,449

 

5,095

 

2010

 

2011

 

One Healing Place

Tampa, FL

 

 

-

 

4,319

 

12,234

 

-

 

4,319

 

12,234

 

2,425

 

2011

 

2003

 

14547 Bruce B Downs Blvd

Tampa, FL

 

 

-

 

1,462

 

7,270

 

-

 

1,462

 

7,270

 

47

 

2017

 

1996

 

12500 N Dale Mabry

Temple, TX

 

 

-

 

2,900

 

9,954

 

26

 

2,900

 

9,980

 

1,375

 

2011

 

2012

 

2601 Thornton Lane

Timonium, MD

 

 

-

 

8,829

 

12,568

 

-

 

8,829

 

12,568

 

263

 

2015

 

2017

 

2118 Greenspring Drive

Tucson, AZ

 

 

-

 

1,302

 

4,925

 

897

 

1,325

 

5,799

 

2,662

 

2008

 

1995

 

2055 W. Hospital Dr.

Tustin, CA

 

 

-

 

3,345

 

541

 

61

 

3,345

 

602

 

230

 

2015

 

1976

 

14591 Newport Ave

Tustin, CA

 

 

-

 

3,361

 

12,039

 

1,421

 

3,361

 

13,460

 

2,124

 

2015

 

1985

 

14642 Newport Ave

Van Nuys, CA

 

 

-

 

-

 

36,187

 

-

 

-

 

36,187

 

8,749

 

2009

 

1991

 

6815 Noble Ave.

Voorhees, NJ

 

 

-

 

6,404

 

24,251

 

1,499

 

6,477

 

25,677

 

9,126

 

2006

 

1997

 

900 Centennial Blvd.

Voorhees, NJ

 

 

-

 

6

 

96,075

 

400

 

99

 

96,381

 

21,530

 

2010

 

2012

 

200 Bowman Drive

Wausau, WI

 

 

-

 

2,050

 

12,176

 

-

 

2,050

 

12,176

 

352

 

2015

 

2017

 

1901 Westwood Center Boulevard

Waxahachie, TX

 

 

-

 

-

 

18,784

 

95

 

303

 

18,576

 

909

 

2016

 

2014

 

2460 N I-35 East

Wellington, FL

 

 

-

 

107

 

16,933

 

2,685

 

326

 

19,398

 

6,388

 

2006

 

2000

 

10115 Forest Hill Blvd.

Wellington, FL

 

 

-

 

388

 

13,697

 

1,637

 

580

 

15,142

 

4,720

 

2007

 

2003

 

1395 State Rd. 7

West Seneca, NY

 

 

-

 

917

 

22,435

 

3,841

 

1,665

 

25,528

 

9,442

 

2007

 

1990

 

550 Orchard Park Rd

Zephyrhills, FL

 

$

-

$

3,874

$

27,266

$

-

$

3,875

$

27,274

$

5,923

 

2011

 

1974

 

38135 Market Square Dr

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outpatient medical total:

 

$

218,382

$

574,346

$

4,724,190

$

315,225

$

639,696

$

4,974,067

$

1,096,012

 

 

 

 

 

 

101


  

 

  

 

Welltower Inc.

 

 

Schedule III

 

 

Real Estate and Accumulated Depreciation

 

 

December 31, 2017

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Initial Cost to Company

 

 

 

Gross Amount at Which Carried at Close of Period

 

 

 

 

 

 

Description

 

 

Encumbrances

 

Land

 

Buildings & Improvements

 

 Cost Capitalized Subsequent to Acquisition

 

Land

 

Buildings & Improvements

 

Accumulated Depreciation

 

Year Acquired

 

Year Built

 

Address

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets held for sale:

 

 

Agawam, MA

 

$

-

$

1,230

$

13,618

$

-

$

-

$

8,189

$

-

 

2011

 

1975

 

61 Cooper Street

Agawam, MA

 

 

-

 

930

 

15,304

 

-

 

-

 

8,807

 

-

 

2011

 

1970

 

55 Cooper Street

Agawam, MA

 

 

-

 

920

 

10,661

 

-

 

-

 

6,185

 

-

 

2011

 

1985

 

464 Main Street

Agawam, MA

 

 

-

 

920

 

10,562

 

-

 

-

 

6,111

 

-

 

2011

 

1967

 

65 Cooper Street

Aspen Hill, MD

 

 

-

 

-

 

9,008

 

-

 

-

 

7,730

 

-

 

2011

 

1988

 

3227 Bel Pre Road

Aurora, CO

 

 

-

 

2,600

 

5,906

 

2,128

 

-

 

10,634

 

-

 

2006

 

1988

 

14101 E. Evans Ave.

Ayer, MA

 

 

-

 

-

 

22,074

 

-

 

-

 

11,708

 

-

 

2011

 

1988

 

400 Groton Road

Beachwood, OH

 

 

-

 

1,260

 

23,478

 

-

 

-

 

13,114

 

-

 

2001

 

1990

 

3800 Park East Drive

Bend, OR

 

 

-

 

1,210

 

9,181

 

-

 

-

 

9,762

 

-

 

2015

 

1981

 

1801 NE Lotus Drive

Bremerton, WA

 

 

-

 

390

 

2,210

 

-

 

-

 

2,073

 

-

 

2006

 

1999

 

3231 Pine Road

Bremerton, WA

 

 

-

 

830

 

10,420

 

-

 

-

 

9,872

 

-

 

2010

 

1984

 

3201 Pine Road NE

Bremerton, WA

 

 

-

 

590

 

2,899

 

-

 

-

 

3,200

 

-

 

2014

 

1997

 

3210 Rickey Road

Burlington, WA

 

 

-

 

3,860

 

31,722

 

-

 

-

 

33,317

 

-

 

2015

 

2001

 

400 Gilkey Road

Carson City, NV

 

 

-

 

520

 

8,238

 

-

 

-

 

8,037

 

-

 

2013

 

1997

 

1111 W. College Parkway

Cedar Grove, WI

 

 

-

 

113

 

618

 

-

 

-

 

554

 

-

 

2010

 

1986

 

313 S. Main St.

Cloquet, MN

 

 

-

 

340

 

4,660

 

-

 

-

 

4,285

 

-

 

2011

 

2006

 

705 Horizon Circle

Columbia, SC

 

 

-

 

2,120

 

4,860

 

1,070

 

-

 

8,050

 

-

 

2003

 

2000

 

731 Polo Rd.

Concord, NH

 

 

-

 

720

 

3,041

 

-

 

-

 

3,344

 

-

 

2011

 

1926

 

227 Pleasant Street

Crown Point, IN

 

 

-

 

920

 

20,044

 

-

 

-

 

15,895

 

-

 

2015

 

2015

 

1555 South Main Street

Dallas, OR

 

 

-

 

410

 

9,427

 

292

 

-

 

10,129

 

-

 

2015

 

1972

 

664 SE Jefferson

Dallas, TX

 

 

-

 

1,080

 

9,655

 

-

 

-

 

6,615

 

-

 

2011

 

1997

 

3611 Dickason Avenue

Dyer, IN

 

 

-

 

1,800

 

25,061

 

-

 

-

 

20,365

 

-

 

2015

 

2015

 

1532 Calumet Avenue

Eugene, OR

 

 

-

 

800

 

5,822

 

-

 

-

 

6,252

 

-

 

2015

 

1990

 

4550 West Amazon Drive

Franklin, WI

 

 

4,161

 

6,872

 

7,550

 

-

 

-

 

10,294

 

-

 

2010

 

1984

 

9200 W. Loomis Rd.

Glastonbury, CT

 

 

-

 

1,950

 

9,532

 

-

 

-

 

7,520

 

-

 

2011

 

1966

 

72 Salmon Brook Drive

Grass Valley, CA

 

 

4,113

 

260

 

7,667

 

-

 

-

 

7,324

 

-

 

2013

 

2001

 

415 Sierra College Drive

Green Bay, WI

 

 

5,178

 

-

 

14,891

 

-

 

-

 

10,945

 

-

 

2010

 

2002

 

2253 W. Mason St.

Green Bay, WI

 

 

-

 

-

 

20,098

 

-

 

-

 

14,874

 

-

 

2010

 

2002

 

2845 Greenbrier Road

Green Bay, WI

 

 

-

 

-

 

11,696

 

-

 

-

 

7,474

 

-

 

2010

 

2002

 

2845 Greenbrier Road

Hemet, CA

 

 

-

 

870

 

3,405

 

-

 

-

 

3,342

 

-

 

2007

 

1996

 

25818 Columbia St.

Houston, TX

 

 

-

 

5,090

 

9,471

 

-

 

-

 

8,442

 

-

 

2007

 

2009

 

15015 Cypress Woods Medical Drive

Houston, TX

 

 

-

 

960

 

27,598

 

-

 

-

 

9,332

 

-

 

2011

 

1995

 

10225 Cypresswood Dr

Hove, UKJ

 

 

-

 

1,360

 

6,979

 

-

 

-

 

2,361

 

-

 

2014

 

1987

 

Furze Hill

Indianapolis, IN

 

 

-

 

495

 

6,287

 

11,018

 

-

 

17,800

 

-

 

2006

 

1981

 

8616 W. Tenth St.

Indianapolis, IN

 

 

-

 

255

 

2,473

 

6,335

 

-

 

9,063

 

-

 

2006

 

1981

 

8616 W.Tenth St.

Kenosha, WI

 

 

5,676

 

-

 

18,058

 

-

 

-

 

12,519

 

-

 

2010

 

1993

 

10400 75th St.

Kent, WA

 

 

-

 

940

 

20,318

 

2,768

 

-

 

24,026

 

-

 

2007

 

2000

 

24121 116th Avenue SE

Lancaster, NH

 

 

-

 

160

 

434

 

-

 

-

 

493

 

-

 

2011

 

1905

 

63 Country Village Road

Lowell, MA

 

 

-

 

1,070

 

13,481

 

-

 

-

 

1,960

 

-

 

2011

 

1975

 

841 Merrimack Street

Marinette, WI

 

 

4,832

 

-

 

13,538

 

-

 

-

 

8,664

 

-

 

2010

 

2002

 

4061 Old Peshtigo Rd.

McMinnville, OR

 

 

-

 

720

 

7,984

 

-

 

-

 

8,296

 

-

 

2015

 

1996

 

3121 NE Cumulus Avenue

Meridian, ID

 

 

-

 

3,600

 

20,802

 

-

 

-

 

6,860

 

-

 

2006

 

2008

 

2825 E. Blue Horizon Dr.

Milwaukee, WI

 

 

3,424

 

540

 

8,457

 

-

 

-

 

5,846

 

-

 

2010

 

1930

 

1218 W. Kilbourn Ave.

Milwaukee, WI

 

 

7,547

 

1,425

 

11,520

 

-

 

-

 

8,731

 

-

 

2010

 

1962

 

3301-3355 W. Forest Home Ave.

Milwaukee, WI

 

 

1,888

 

922

 

2,185

 

-

 

-

 

2,108

 

-

 

2010

 

1958

 

840 N. 12th St.

Milwaukee, WI

 

 

13,270

 

-

 

44,535

 

-

 

-

 

30,222

 

-

 

2010

 

1983

 

2801 W. Kinnickinnic Pkwy.

Milwaukie, OR

 

 

-

 

400

 

6,782

 

-

 

-

 

6,828

 

-

 

2015

 

1991

 

5770 SE Kellogg Creek Drive

Mount Vernon, WA

 

 

-

 

3,440

 

21,842

 

128

 

-

 

25,410

 

-

 

2014

 

1987

 

1810 E. Division Street

Mt. Vernon, WA

 

 

-

 

400

 

2,200

 

-

 

-

 

2,066

 

-

 

2006

 

2001

 

3807 East College Way

Muskego, WI

 

 

908

 

964

 

2,159

 

-

 

-

 

2,156

 

-

 

2010

 

1993

 

S74 W16775 Janesville Rd.

New Berlin, WI

 

 

3,500

 

3,739

 

8,290

 

-

 

-

 

8,129

 

-

 

2010

 

1993

 

14555 W. National Ave.

New Haven, IN

 

 

-

 

176

 

3,524

 

-

 

-

 

1,961

 

-

 

2004

 

1981

 

1201 Daly Dr.

North Bend, OR

 

 

-

 

1,290

 

7,361

 

164

 

-

 

8,815

 

-

 

2015

 

1995

 

2290 Inland Drive

North Cape May, NJ

 

 

-

 

77

 

151

 

137

 

-

 

365

 

-

 

2015

 

1988

 

610 Town Bank Road

Oshkosh, WI

 

 

-

 

-

 

18,339

 

-

 

-

 

12,160

 

-

 

2010

 

2000

 

855 North Wethaven Dr.

Oshkosh, WI

 

 

5,978

 

-

 

15,881

 

-

 

-

 

11,337

 

-

 

2010

 

2000

 

855 North Wethaven Dr.

Palm Springs, FL

 

 

-

 

739

 

4,066

 

-

 

-

 

2,061

 

-

 

2006

 

1993

 

1640 S. Congress Ave.

Palm Springs, FL

 

 

-

 

1,182

 

7,765

 

-

 

-

 

3,072

 

-

 

2006

 

1997

 

1630 S. Congress Ave.

Plymouth, WI

 

 

1,059

 

1,250

 

1,870

 

-

 

-

 

2,149

 

-

 

2010

 

1991

 

2636 Eastern Ave.

Post Falls, ID

 

 

-

 

2,700

 

14,217

 

-

 

-

 

14,941

 

-

 

2007

 

2008

 

460 N. Garden Plaza Ct.

Richardson, TX

 

 

-

 

1,800

 

16,562

 

-

 

-

 

17,440

 

-

 

2015

 

2009

 

1350 East Lookout Drive

Rockville, MD

 

 

-

 

-

 

16,398

 

-

 

-

 

8,715

 

-

 

2012

 

1986

 

9701 Medical Center Drive

Roseburg, OR

 

 

-

 

1,200

 

4,891

 

-

 

-

 

5,792

 

-

 

2015

 

1990

 

1901 NW Hughwood Drive

Salem, OR

 

 

-

 

440

 

4,726

 

-

 

-

 

4,903

 

-

 

2015

 

1992

 

3988 12th Street SE

Sheboygan, WI

 

 

1,463

 

1,012

 

2,216

 

-

 

-

 

2,318

 

-

 

2010

 

1958

 

1813 Ashland Ave.

Shelton, WA

 

 

-

 

530

 

17,049

 

-

 

-

 

15,409

 

-

 

2012

 

1989

 

900 W Alpine Way

Sparks, NV

 

 

-

 

3,700

 

46,526

 

-

 

-

 

39,559

 

-

 

2007

 

2009

 

275 Neighborhood Way

Springfield, OR

 

 

-

 

1,790

 

8,865

 

-

 

-

 

10,131

 

-

 

2015

 

1994

 

770 Harlow Road

Summit, WI

 

 

-

 

2,899

 

87,666

 

-

 

-

 

60,029

 

-

 

2008

 

2009

 

36500 Aurora Dr.

Tucson, AZ

 

 

-

 

1,190

 

18,318

 

316

 

-

 

19,824

 

-

 

2015

 

1997

 

8151 E Speedway Boulevard

Wallingford, CT

 

 

-

 

490

 

1,210

 

-

 

-

 

941

 

-

 

2011

 

1962

 

35 Marc Drive

West Allis, WI

 

 

2,685

 

1,106

 

3,308

 

-

 

-

 

3,159

 

-

 

2010

 

1961

 

11333 W. National Ave.

Westlake, OH

 

 

-

 

1,330

 

17,926

 

-

 

-

 

10,208

 

-

 

2001

 

1985

 

27601 Westchester Pkwy.

Wilkes-Barre, PA

 

$

-

$

570

$

2,301

$

-

$

-

$

1,545

$

-

 

2011

 

1992

 

300 Courtright Street

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets held for sale total

 

$

65,682

$

85,466

$

909,837

$

24,356

$

-

$

734,147

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

105


  

 

  



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Triple-net

$

343,361

$

818,863

$

7,759,508

$

382,344

$

847,780

$

8,112,937

$

1,380,023

Seniors housing operating

 

1,988,700

 

1,174,980

 

12,626,419

 

1,234,180

 

1,246,991

 

13,788,584

 

2,362,335

Outpatient medical

 

218,382

 

574,346

 

4,724,190

 

315,225

 

639,696

 

4,974,067

 

1,096,012

Construction in progress

 

-

 

-

 

237,746

 

-

 

-

 

237,746

 

-

Total continuing operating properties

 

2,550,443

 

2,568,189

 

25,347,863

 

1,931,749

 

2,734,467

 

27,113,334

 

4,838,370

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets held for sale

 

65,682

 

85,466

 

909,837

 

24,356

 

-

 

734,147

 

-

Total investments in real property owned

$

2,616,125

$

2,653,655

$

26,257,700

$

1,956,105

$

2,734,467

$

27,847,481

$

4,838,370

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Please see Note 2 to our consolidated financial statements for information regarding lives used for depreciation and amortization.

(2) Represents real property asset associated with a capital lease.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

107


  

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

Investment in real estate:

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

30,041,058

 

$

29,865,490

 

$

25,491,935

 

 

 

Acquisitions and development

 

 

1,276,636

 

 

2,834,279

 

 

5,076,830

 

 

 

Improvements

 

 

250,276

 

 

219,146

 

 

187,752

 

 

 

Deconsolidation of previously consolidated venture

 

 

(144,897)

 

 

-

 

 

-

 

 

 

Impairment of assets

 

 

(101,527)

 

 

(37,207)

 

 

(2,220)

 

 

 

Dispositions

 

 

(1,203,247)

 

 

(2,411,219)

 

 

(491,396)

 

 

 

Foreign currency translation

 

 

415,879

 

 

(429,431)

 

 

(397,411)

 

 

 

Other(1)

 

 

47,770

 

 

-

 

 

-

 

 

Ending balance(2)

 

$

30,581,948

 

$

30,041,058

 

$

29,865,490

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated depreciation:

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

 

$

4,093,494

 

$

3,796,297

 

$

3,020,908

 

 

 

Depreciation and amortization expenses

 

 

921,720

 

 

901,242

 

 

826,240

 

 

 

Amortization of above market leases

 

 

7,303

 

 

7,909

 

 

11,912

 

 

 

Disposition and other

 

 

(192,029)

 

 

(514,651)

 

 

(111,199)

 

 

 

Foreign currency translation

 

 

7,882

 

 

(97,303)

 

 

48,436

 

 

Ending balance

 

$

4,838,370

 

$

4,093,494

 

$

3,796,297

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Primarily relates to the acquisition of an asset through foreclosure.

(2) The unaudited aggregate cost for tax purposes for real property equals $25,618,090,000 at December 31, 2017.

108


  

Welltower Inc.

Schedule IV - Mortgage Loans on Real Estate

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

Location

Segment

 

Interest Rate

 

Final Maturity Date

 

 

Monthly Payment Terms

 

 

Prior Liens

 

 

Face Amount of Mortgages

 

 

Carrying Amount of Mortgages

 

 

Principal Amount of Loans Subject to Delinquent Principal or Interest

 

First mortgages relating to 1 property located in:

 

 

 

 

 

 

 

 

 

 

 

 

 

California

Triple-Net

 

8.11%

 

12/15/20

 

$

2,011,590

 

$

-

 

$

28,000

 

$

292

 

$

-

 

United Kingdom

Triple-Net

 

7.25%

 

11/21/19

 

 

115,794,386

 

 

-

 

 

18,805

 

 

18,805

 

 

-

 

United Kingdom

Triple-Net

 

8.29%

 

01/16/18

 

 

9,521,615

 

 

-

 

 

2,841

 

 

1,352

 

 

-

 

United Kingdom

Triple-Net

 

8.00%

 

08/24/22

 

 

10,858,294

 

 

-

 

 

11,712

 

 

1,645

 

 

-

 

United Kingdom

Triple-Net

 

8.55%

 

07/01/19

 

 

83,119,990

 

 

-

 

 

15,487

 

 

15,486

 

 

-

 

United Kingdom

Triple-Net

 

7.00%

 

03/14/22

 

 

96,303,670

 

 

-

 

 

28,374

 

 

16,139

 

 

-

 

United Kingdom

Triple-Net

 

8.00%

 

07/06/19

 

 

137,884,551

 

 

-

 

 

20,294

 

 

20,294

 

 

-

 

Oklahoma

Triple-Net

 

9.02%

 

11/01/19

 

 

88,826,160

 

 

-

 

 

11,610

 

 

11,595

 

 

-

 

Oregon

Triple-Net

 

7.10%

 

12/31/17

 

 

1,356,780

 

 

-

 

 

225

 

 

225

 

 

-

 

Pennsylvania

Triple-Net

 

8.11%

 

03/01/22

 

 

36,683,720

 

 

-

 

 

15,530

 

 

5,706

 

 

-

 

Florida

Triple-Net

 

8.79%

 

06/23/21

 

 

94,519,150

 

 

-

 

 

17,100

 

 

12,444

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

First mortgages relating to multiple properties:

 

 

 

 

 

 

 

 

 

 

 

 

 

7 properties in four states

Triple-Net

 

10.00%

 

01/01/22

 

$

297,169,200

 

 

-

 

 

65,796

 

 

25,832

 

 

-

 

13 properties in Texas

Triple-Net

 

10.00%

 

01/01/22

 

 

851,672,100

 

 

-

 

 

103,620

 

 

82,041

 

 

-

 

13 properties in six states

Triple-Net

 

10.00%

 

01/01/22

 

 

1,139,453,100

 

 

-

 

 

138,633

 

 

91,164

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Second mortgages relating to 1 property located in:

 

 

 

 

 

 

 

 

 

 

 

 

 

Texas

Triple-Net

 

12.17%

 

05/01/19

 

 

32,033

 

 

11,367

 

 

3,100

 

 

3,100

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Totals

 

 

 

 

 

 

 

 

 

$

11,367

 

$

481,127

 

$

306,120

 

$

-

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31,

 

 

 

 

 

 

 

 

 

2017

 

 

2016

 

 

2015

Reconciliation of mortgage loans:

 

 

 

 

 

 

(in thousands)

 

Balance at beginning of year

 

 

 

 

 

$

485,735

 

$

635,492

 

$

188,651

 

Additions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New mortgage loans

 

 

 

 

 

 

6,706

 

 

8,223

 

 

524,088

 

 

Draws on existing loans

 

 

 

 

 

 

58,224

 

 

92,815

 

 

30,550

 

 

 

 

 

 

 

 

64,930

 

 

101,038

 

 

554,638

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deductions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collections of principal

 

 

 

 

 

 

(180,135)

 

 

(191,134)

 

 

(80,552)

 

 

Conversions to real property

 

 

 

 

 

 

-

 

 

(45,044)

 

 

(23,288)

 

 

Change in allowance for loan losses and charge-offs

 

 

 

 

 

 

(71,535)

 

 

(3,053)

 

 

-

 

Total deductions

 

 

 

 

 

 

(251,670)

 

 

(239,231)

 

 

(103,840)

 

Change in balance due to foreign currency translation

 

 

 

 

 

 

7,125

 

 

(11,564)

 

 

(3,957)

 

Balance at end of year

 

 

 

 

 

$

306,120

 

$

485,735

 

$

635,492

 

109