Segment Reporting

3 Months Ended

Mar. 31, 2013

Segment Reporting

Segment Reporting

Note 9.  Segment Reporting

We have four operating segments, of which three are reportable operating segments: (i) triple net senior living communities that provide short term and long term residential care and dining services for residents, (ii) managed senior living communities leased to our TRSs that provide short term and long term residential care and dining services for residents and (iii) MOBs. Our triple net and managed senior living communities include independent living communities and assisted living communities, skilled nursing facilities, or SNFs, and two rehabilitation hospitals.  Properties in the MOB segment include medical office, clinic and biotech laboratory buildings.  The “All Other” category in the following table includes amounts related to corporate business activities and the operating results of certain properties that offer fitness, wellness and spa services to members.

Following the transfer of the ten properties formerly leased to Sunrise Senior Living, Inc., or Sunrise, to one of our TRSs and management by Five Star for our account, which will be effective for the full year 2013, we determined that the segregation of our managed senior living communities into its own reporting segment is appropriate because this is the way our management began to assess the performance of this part of our business and to make operating decisions for these properties. We previously operated through two reportable segments: short and long term residential care communities and MOBs. We also renamed our short and long term residential care communities segment to triple net senior living communities. Prior year amounts have been restated to reflect the segregation of our managed senior living communities into a reportable business segment.

	For the Three Months Ended March 31, 2013
	Triple Net Senior Living Communities			Managed Senior Living Communities			MOBs			All Other Operations			Consolidated
Revenues:
Rental income	$	56,765		$	—		$	53,204		$	4,404		$	114,373
Residents fees and services	—			75,056			—			—			75,056
Total revenues	56,765			75,056			53,204			4,404			189,429
Expenses:
Depreciation	16,917			6,849			13,588			948			38,302
Property operating expenses	—			57,904			16,678			—			74,582
General and administrative	—			—			—			8,648			8,648
Acquisition related costs	—			—			—			1,903			1,903
Impairment of assets	—			—			1,304			—			1,304
Total expenses	16,917			64,753			31,570			11,499			124,739
Operating income (loss)	39,848			10,303			21,634			(7,095		)	64,690
Interest and other income	—			—			—			173			173
Interest expense	(6,463		)	(3,068		)	(1,348		)	(18,685		)	(29,564		)
Equity in earnings of an investee	—			—			—			76			76
Income (loss) before income tax expense	33,385			7,235			20,286			(25,531		)	35,375
Income tax expense	—			—			—			(140		)	(140		)
Net income (loss)	$	33,385		$	7,235		$	20,286		$	(25,671	)	$	35,235
Total assets	$	1,910,293		$	954,155		$	1,522,646		$	424,175		$	4,811,269

	For the Three Months Ended March 31, 2012
	Triple Net Senior Living Communities			Managed Senior Living Communities			MOBs			All Other Operations			Consolidated
Revenues:
Rental income	$	58,824		$	—		$	46,261		$	4,420		$	109,505
Residents fees and services	—			35,568			—			—			35,568
Total revenues	58,824			35,568			46,261			4,420			145,073
Expenses:
Depreciation	17,191			3,706			11,532			948			33,377
Property operating expenses	—			25,499			13,835			—			39,334
General and administrative	—			—			—			7,685			7,685
Acquisition related costs	—			—			—			688			688
Impairment of assets	—			—			3,071			—			3,071
Total expenses	17,191			29,205			28,438			9,321			84,155
Operating income (loss)	41,633			6,363			17,823			(4,901		)	60,918
Interest and other income	—			—			—			482			482
Interest expense	(10,245		)	(2,933		)	(412		)	(15,299		)	(28,889		)
Equity in earnings of an investee	—			—			—			45			45
Income (loss) before income tax expense	31,388			3,430			17,411			(19,673		)	32,556
Income tax expense	—			—			—			(204		)	(204		)
Net income (loss)	$	31,388		$	3,430		$	17,411		$	(19,877	)	$	32,352
Total assets	$	2,003,386		$	730,879		$	644,811		$	1,004,745		$	4,383,821