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Significant Tenant
3 Months Ended
Mar. 31, 2014
Significant Tenant  
Significant Tenant

Note 9.  Significant Tenant

 

Five Star is our former subsidiary.  Rental income from Five Star represented 42.1% of our rental income for the three months ended March 31, 2014, and the properties Five Star leases from us represented 40.0% of our investments, at cost, as of March 31, 2014.  As of March 31, 2014, Five Star also managed 44 senior living communities for our account.

 

Subject to the information in the following paragraph, financial information about Five Star may be found on the website of the Securities and Exchange Commission, or SEC, by entering Five Star’s name at http://www.sec.gov/edgar/searchedgar/companysearch.html. Reference to Five Star’s financial information on this external website is presented to comply with applicable accounting guidance of the SEC. Except for such financial information contained therein as is included herein under such guidance, Five Star’s public filings and other information located in external websites are not incorporated by reference into these financial statements.

 

In April 2014, Five Star filed with the SEC an amended Annual Report on Form 10-K for the year ended December 31, 2012 and amended Quarterly Reports on Form 10-Q for the quarters ended March 31, 2013 and June 30, 2013 that restated its financial results for 2011, 2012 and the first and second quarters of 2013 to correct certain errors in the accounting for income taxes and other errors contained in its previously filed financial reports for those periods.  In addition, in April 2014, Five Star filed with the SEC its Quarterly Report on Form 10-Q for the quarter ended September 30, 2013.  In those filings, Five Star disclosed that, as a result of the matters discussed above, Five Star has material weaknesses in its internal control over financial reporting, that Five Star is currently in the process of developing a remediation plan for the material weaknesses, and that Five Star expects the remediation of the material weaknesses to be completed before December 31, 2014.  Five Star has not yet filed its Annual Report on Form 10-K for the year ended December 31, 2013.  Five Star has publicly disclosed that it is in the process of preparing its Annual Report on Form 10-K for the year ended December 31, 2013.  However, there is no assurance as to when that report will be completed and filed with the SEC.

 

See Note 10 for further information relating to our leases and management arrangements with Five Star.