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Fair Value of Assets and Liabilities (Tables)
3 Months Ended
Mar. 31, 2019
Fair Value Disclosures [Abstract]  
Assets and liabilities recurring and nonrecurring measured at fair value
The estimated fair value of these 15 SNFs as of March 31, 2019 was as follows:
 
 
 
 
Quoted Prices in 
Active Markets for Identical Assets
 
Significant Other Observable Inputs
 
Significant Unobservable Inputs
Description
 
Total
 
(Level 1)
 
(Level 2)
 
(Level 3)
Non-Recurring Fair Value Measurements
 
 
 
 
 
 
Real estate properties held for sale
 
$
7,489

 
$

 
$
7,489

 
$

The following table presents certain of our assets that are measured at fair value on a recurring basis at March 31, 2019, categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset or liability. 
 
 
 
 
Fair Value at Reporting Date Using
 
 
 
 
Quoted Prices in 
Active Markets for Identical Assets
 
Significant Other Observable Inputs
 
Significant Unobservable Inputs
Description
 
Total
 
(Level 1)
 
(Level 2)
 
(Level 3)
Recurring Fair Value Measurements
 
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
 
Investment in RMR Inc. (1)
 
$
160,830

 
$
160,830

 
$

 
$

Investment in Five Star (2)
 
$
4,129

 
$
4,129

 
$

 
$


(1)
Our 2,637,408 shares of class A common stock of The RMR Group Inc., or RMR Inc., which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs). Our historical cost basis for these shares is $69,826 as of March 31, 2019. During the three months ended March 31, 2019, we recorded an unrealized gain of $20,836 to adjust the carrying value of our investment in RMR Inc. class A common shares to their fair value.
(2)
Our 4,235,000 common shares of Five Star Senior Living Inc., or Five Star, which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs). Our adjusted cost basis for these shares is $6,353 as of March 31, 2019. During the three months ended March 31, 2019, we recorded an unrealized gain of $2,096 to adjust the carrying value of our investment in Five Star common shares to their fair value.
Schedule of carrying value and fair value of the financial instruments
The fair values of these financial instruments approximated their carrying values in our condensed consolidated financial statements as of such dates, except as follows: 
 
 
As of March 31, 2019
 
As of December 31, 2018
Description
 
Carrying Amount (1)
 
Estimated Fair Value
 
Carrying Amount (1)
 
Estimated Fair Value
Senior unsecured notes
 
$
2,217,989

 
$
2,225,390

 
$
2,216,945

 
$
2,138,202

Secured debts(2)
 
742,883

 
720,339

 
744,186

 
723,003

 
 
$
2,960,872

 
$
2,945,729

 
$
2,961,131

 
$
2,861,205

(1)
Includes unamortized debt issuance costs, premiums and discounts.
(2)
We assumed certain of these secured debts in connection with our acquisitions of certain properties. We recorded the assumed mortgage notes debts at estimated fair value on the date of acquisition and we are amortizing the fair value adjustments, if any, to interest expense over the respective terms of the mortgage notes to reduce interest expense to the estimated market interest rates as of the date of acquisition.