Note 6 - Long-term Leases

3 Months Ended

Mar. 31, 2017

Notes to Financial Statements

Leases of Lessee Disclosure [Text Block]

Note 

6

– Long-Term Leases

Capital Leases

Fixed assets recorded under the capital leases, which are included in property and equipment in the interim condensed consolidated balance sheets, are as follows:

	March 31, 2017			December 31, 2016
	(in thousands)
Buildings and personal property	$	39,032		$	39,032
Accumulated amortization		(12,101	)		(11,120	)
	$	26,931		$	27,912

Operating Leases

At

March

31,

2017,

NHC leases from National Health Investors, Inc. (“NHI”) the real property of

35

skilled nursing facilities,

seven

assisted living facilities and

three

independent living facilities under

two

separate lease agreements. Base rent expense under both lease agreements totals

$34,200,000

annually with rent thereafter escalating by

4%

of the increase in facility revenue over the base year. Total facility rent expense to NHI was

$9,314,000

and

$9,480,000

for the

three

months ended

March

31,

2017

and

2016,

respectively.

Minimum Lease Payments

The approximate future minimum lease payments required under all leases that have remaining non-cancelable lease terms at

March

31,

2017

are as follows:

	Operating Leases		Capital Leases
	(in thousands)
2018	$	34,200	$	5,200
2019		34,200		5,200
2020		34,200		5,200
2021		34,200		5,200
2022		34,200		5,200
Thereafter		168,200		9,967
Total minimum lease payments	$	339,200	$	35,967
Less: Amounts representing interest				(6,589	)
Present value of minimum lease payments				29,378
Less: Current portion				(3,533	)
Long-term capital lease obligations			$	25,845