10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number: 000-51288

CNL Lifestyle Properties, Inc.

(Exact name of registrant as specified in its charter)

Maryland	20-0183627
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
450 South Orange Avenue Orlando, Florida	32801
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (407) 650-1000

Former name, former address and former fiscal year, if changed since last report

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  x    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  x    No  ¨

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	x  (Do not check if a smaller reporting company)	Smaller reporting company	¨

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

The number of shares of common stock outstanding as of November 5, 2015 was 325,183,002.

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Information (unaudited):
	Condensed Consolidated Balance Sheets		1
	Condensed Consolidated Statements of Operations		2
	Condensed Consolidated Statements of Comprehensive Losses		3
	Condensed Consolidated Statements of Stockholders’ Equity		4
	Condensed Consolidated Statements of Cash Flows		5
	Notes to Condensed Consolidated Financial Statements		6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		36
Item 4.	Controls and Procedures		37
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		38
Item 1A.	Risk Factors		38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		38
Item 3.	Defaults Upon Senior Securities		38
Item 4.	Mine Safety Disclosures		38
Item 5.	Other Information		38
Item 6.	Exhibits		38
Signatures			39
Exhibits			40

PART I FINANCIAL INFORMATION

Item 1. Financial Statements

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(in thousands except per share data)

	September 30, 2015			December 31, 2014
ASSETS
Real estate investment properties, net (including $60,763 and $67,789 related to consolidated variable interest entities, respectively)	$	841,576		$	882,089
Assets held for sale, net (including $89,811 and $103,753 related to consolidated variable interest entities, respectively)		259,285			968,641
Investments in unconsolidated entities		72,679			127,102
Cash		310,726			136,985
Deferred rent and lease incentives		41,758			47,307
Restricted cash		28,565			35,227
Other assets		17,461			29,091
Intangibles, net		17,448			18,011
Accounts and other receivables, net		21,450			20,398
Mortgages and other notes receivable, net		7,570			19,361
Total Assets	$	1,618,518		$	2,284,212
LIABILITIES AND STOCKHOLDERS’ EQUITY
Mortgages and other notes payable (including $19,923 and $20,642 related to non-recourse debt of consolidated variable interest entities, respectively)	$	187,643		$	397,849
Senior notes, net of discount		—			316,846
Liabilities related to assets held for sale		—			171,745
Line of credit		—			152,500
Other liabilities		40,318			41,388
Accounts payable and accrued expenses		23,949			46,005
Due to affiliates		415			489
Total Liabilities		252,325			1,126,822
Commitments and contingencies (Note 13)
Stockholders’ equity:
Preferred stock, $.01 par value per share 200 million shares authorized and unissued		—			—
Excess shares, $.01 par value per share 120 million shares authorized and unissued		—			—
Common stock, $.01 par value per share
One billion shares authorized; 349,084 shares issued and 325,183 and 325,184 shares outstanding as of September 30, 2015 and December 31, 2014, respectively		3,252			3,252
Capital in excess of par value		2,863,833			2,863,839
Accumulated deficit		(232,738	)		(494,129	)
Accumulated distributions		(1,260,079	)		(1,211,302	)
Accumulated other comprehensive loss		(8,075	)		(4,270	)
Total Stockholders’ Equity		1,366,193			1,157,390
Total Liabilities and Stockholders’ Equity	$	1,618,518		$	2,284,212

See accompanying notes to condensed consolidated financial statements.

1

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

(in thousands except per share data)

	Quarter Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Revenues:
Rental income from operating leases	$	29,574		$	31,720		$	92,625		$	97,634
Property operating revenues		97,901			110,866			191,145			205,910
Interest income on mortgages and other notes receivable		125			1,965			1,481			8,044
Total revenues		127,600			144,551			285,251			311,588
Expenses:
Property operating expenses		56,256			62,450			145,315			153,609
Asset management fees to advisor		3,665			4,394			12,193			14,173
General and administrative		2,984			4,320			11,467			13,172
Ground lease and permit fees		2,426			2,192			7,819			7,843
Acquisition fees and costs		—			(237	)		—			519
Other operating expenses		1,731			1,878			4,875			3,858
Bad debt expense		3,256			26			8,092			34
Loan loss provision		21			750			9,369			3,270
Impairment provisions		1,428			—			1,428			—
Depreciation and amortization		19,807			25,389			63,463			73,179
Total expenses		91,574			101,162			264,021			269,657
Operating income		36,026			43,389			21,230			41,931
Other income (expense):
Interest and other income		309			153			1,066			449
Interest expense and loan cost amortization		(3,202	)		(15,012	)		(23,946	)		(44,380	)
Loss on extinguishment of debt		—			(1,620	)		(21,065	)		(1,816	)
Equity in earnings of unconsolidated entities		1,162			3,176			3,940			6,949
Total other expense		(1,731	)		(13,303	)		(40,005	)		(38,798	)
(Loss) income from continuing operations		34,295			30,086			(18,775	)		3,133
Income (loss) from discontinued operations (includes $57 and $460 amortization of loss and loss on termination of cash flow hedge for the quarter and nine months ended September 30, 2014, respectively)		7,614			537			214,386			(1,368	)
Net income before gain on sale of real estate and unconsolidated entity		41,909			30,623			195,611			1,765
Gain (loss) on sale of real estate		(1,064	)		—			26,528			—
Gain from sale of unconsolidated entity		—			—			39,252			—
Net income	$	40,845		$	30,623		$	261,391		$	1,765
Net income per share of common stock (basic and diluted)
Continuing operations	$	0.11		$	0.09		$	0.14		$	0.01
Discontinued operations		0.02			0.00			0.66			0.00
Net income per share	$	0.13		$	0.09		$	0.80		$	0.01
Weighted average number of shares of common stock outstanding (basic and diluted)		325,183			325,707			325,183			324,194

See accompanying notes to condensed consolidated financial statements.

2

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSSES

(UNAUDITED)

(in thousands)

	Quarter Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Net income	$	40,845		$	30,623		$	261,391		$	1,765
Other comprehensive income (loss):
Foreign currency translation adjustments		(2,254	)		(1,478	)		(4,084	)		(1,383	)
Changes in fair value of cash flow hedges:
Amortization of loss and loss on termination of cash flow hedges		—			56			180			3,487
Unrealized gain (loss) arising during the period		(53	)		204			99			816
Total other comprehensive income (loss)		(2,307	)		(1,218	)		(3,805	)		2,920
Total comprehensive income	$	38,538		$	29,405		$	257,586		$	4,685

See accompanying notes to condensed consolidated financial statements.

3

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

For the Nine Months Ended September 30, 2015 and the Year Ended December 31, 2014

(UNAUDITED)

(in thousands except per share data)

																Accumulated
	Common Stock						Capital in									Other			Total
	Number			Par			Excess of			Accumulated			Accumulated			Comprehensive			Stockholders’
	of Shares			Value			Par Value			Deficit			Distributions			Loss			Equity
Balance at December 31, 2013		322,627		$	3,226		$	2,846,265		$	(401,985	)	$	(1,073,422	)	$	(5,706	)	$	1,368,378
Subscriptions received for stock through public offering reinvestment plan		3,970			40			27,169			—			—			—			27,209
Redemption of common stock		(1,413	)		(14	)		(9,595	)		—			—			—			(9,609	)
Net loss		—			—			—			(92,144	)		—			—			(92,144	)
Distributions, declared and paid ($0.4252 per share)		—			—			—			—			(137,880	)		—			(137,880	)
Foreign currency translation adjustment		—			—			—			—			—			(2,933	)		(2,933	)
Amortization of loss on termination of cash flow hedges		—			—			—			—			—			3,486			3,486
Current period adjustment to recognize changes in fair value of cash flow hedges, net of reclassification (Note 9)		—			—			—			—			—			883			883
Balance at December 31, 2014		325,184			3,252			2,863,839			(494,129	)		(1,211,302	)		(4,270	)		1,157,390
Net income		—			—			—			261,391			—			—			261,391
Redemption of common stock		(1	)		—			(6	)		—			—			—			(6	)
Distributions, declared and paid ($0.1500 per share)		—			—			—			—			(48,777	)		—			(48,777	)
Foreign currency translation adjustment		—			—			—			—			—			(4,084	)		(4,084	)
Amortization of loss on termination of cash flow hedge		—			—			—			—			—			180			180
Current period adjustment to recognize changes in fair value of cash flow hedges (Note 9)		—			—			—			—			—			99			99
Balance at September 30, 2015		325,183		$	3,252		$	2,863,833		$	(232,738	)	$	(1,260,079	)	$	(8,075	)	$	1,366,193

See accompanying notes to condensed consolidated financial statements.

4

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(in thousands)

	Nine Months Ended September 30,
	2015			2014
Operating activities:
Net cash provided by operating activities	$	80,940		$	132,818
Investing activities:
Acquisition of property		—			(128,390	)
Capital expenditures		(35,787	)		(55,888	)
Proceeds from sale of real estate		757,944			370,774
Proceeds from sale of unconsolidated entity		139,501			—
Contribution to unconsolidated entity		(54,572	)		—
Proceeds from insurance		3,907			—
Principal payments received on mortgage loans receivable		2,258			83,459
Changes in restricted cash		11,671			(1,876	)
Other		—			823
Net cash provided by investing activities		824,922			268,902
Financing activities:
Redemption of common stock		(6	)		(9,412	)
Distributions to stockholders, net of reinvestments in 2014		(48,777	)		(76,119	)
Proceeds under line of credit		—			102,500
Proceeds from mortgage loans and other notes payable		—			57,790
Principal payments on line of credit		(152,500	)		(30,000	)
Principal payments on mortgage loans and senior notes		(527,975	)		(231,846	)
Principal payments on capital leases		(2,539	)		(4,545	)
Payments of entrance fee refunds		—			(1,257	)
Payment of loan costs		(239	)		(3,204	)
Net cash used in financing activities		(732,036	)		(196,093	)
Effect of exchange rate fluctuations on cash		(85	)		(79	)
Net increase in cash		173,741			205,548
Cash at beginning of period		136,985			71,574
Cash at end of period	$	310,726		$	277,122
Supplemental disclosure of non-cash financing activities:
Assumption of mortgage loans by third party	$	151,478		$	—

See accompanying notes to condensed consolidated financial statements.

5

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

1. Organization and Nature of Business:

CNL Lifestyle Properties, Inc. (the “Company”), was organized in Maryland on August 11, 2003. The Company operates and has elected to be taxed as a real estate investment trust (a “REIT”) for federal income tax purposes. Various wholly-owned subsidiaries have been and will be formed by the Company for the purpose of acquiring and owning direct or indirect interests in real estate. The Company generally invests in lifestyle properties in the United States that are primarily leased on a long-term (generally five to 20-years, plus multiple renewal options), triple-net or gross basis to tenants or operators that the Company considers to be industry leading. The Company also leases properties to taxable REIT subsidiary (“TRS”) tenants and engages independent third-party managers to operate those properties. In the event of certain tenant defaults, the Company has also engaged third-party managers to operate properties on its behalf until they are re-leased. The Company has engaged CNL Lifestyle Advisor Corporation (the “Advisor”) as its Advisor to provide management, acquisition, disposition, advisory and administrative services.

As of September 30, 2015, the Company owned 65 lifestyle properties directly and indirectly within the following asset classes: ski and mountain lifestyle, attractions, marinas and other lifestyle properties. Seven of these 65 properties were owned through one unconsolidated joint venture and three were located in Canada.

In March 2014, the Company engaged Jefferies LLC, a leading global investment banking and advisory firm, to assist the Company’s management and its board of directors in actively evaluating various strategic alternatives to provide liquidity to the Company’s shareholders. In connection with this process, during 2014 the Company sold its entire golf portfolio (consisting of 48 properties) and its multi-family development property. Additionally, during the first nine months of 2015, the Company (i) sold its 81.98% interest in the DMC Partnership for net sales proceeds of approximately $139.5 million to its co-venture partner, for a gain of approximately $39.3 million, (ii) sold all 38 of its senior housing properties and one of its attractions properties for aggregate net sales proceeds of approximately $757.9 million, which resulted in aggregate gains of approximately $236.3 million, (iii) entered into a purchase and sale agreement for the sale of the marinas portfolio for approximately its carrying value, and (iv) as of September 30, 2015, had a contract in place to sell one attraction property, a letter of intent to sell two attraction properties, a plan to sell a ski and mountain lifestyle property, and a plan to sell its undeveloped land. See Note 14. “Subsequent Events” for additional information.

2. Significant Accounting Policies:

Principles of Consolidation and Basis of Presentation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States (“GAAP”). The unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which, in the opinion of management are necessary for the fair statement of the Company’s results for the interim period presented. Operating results for the quarter and nine months ended September 30, 2015 may not be indicative of the results that may be expected for the year ending December 31, 2015. Amounts as of December 31, 2014 included in the unaudited condensed consolidated financial statements have been derived from audited consolidated financial statements as of that date but do not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

The accompanying unaudited condensed consolidated financial statements include the Company’s accounts, the accounts of wholly owned subsidiaries or subsidiaries for which the Company has a controlling interest, the accounts of variable interest entities (“VIEs”) in which the Company is the primary beneficiary, and the accounts of other subsidiaries over which the Company has a controlling financial interest. All material intercompany accounts and transactions have been eliminated in consolidation.

In accordance with the guidance for the consolidation of VIEs, the Company analyzes its variable interests, including loans, leases, guarantees, and equity investments, to determine if the entity in which it has a variable interest is a VIE. The Company’s analysis includes both quantitative and qualitative reviews. The Company bases its quantitative analysis on the forecasted cash flows of the entity and its qualitative analysis on its review of the design of the entity, its organizational structure including decision-making ability and financial agreements. The Company also uses its quantitative and qualitative analyses to determine if it is the primary beneficiary of the VIE, and if such determination is made, it includes the accounts of the VIE in its consolidated financial statements.

6

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

2. Significant Accounting Policies (Continued):

Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods and the disclosure of contingent liabilities. For example, significant estimates and assumptions are made in connection with the analysis of real estate, equity method investments and impairments. Actual results could differ from those estimates.

Reclassifications — Certain amounts in the prior year’s condensed consolidated financial statements have been reclassified to conform to current year presentation with no effect on previously reported net loss or equity. See Note 4. “Assets and Associated Liabilities Held for Sale, net of Discontinued Operations” for additional information.

Adopted Accounting Pronouncements — In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“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.” This update changes the criteria for reporting discontinued operations where only disposals representing a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, such as a major line of business or geographical area, should be presented as a discontinued operation. This ASU is effective prospectively for all disposals (or classifications as held for sale) of components of an entity that occur on or after the effective date. As a result, no changes were made for properties classified as held for sale prior to January 1, 2015. Effective January 1, 2015, the Company adopted this ASU. This ASU impacts the determination of which property disposals qualify as discontinued operations, as well as requires additional disclosures about discontinued operations.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” as a new ASC topic (Topic 606). The core principle of this amendment is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard further provides guidance for any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards (for example, lease contracts). This ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016, expected to be deferred one year, including interim periods within that reporting period, with earlier adoption not permitted. ASU 2014-09 can be adopted using one of two retrospective application methods: 1) retrospectively to each prior reporting period presented or 2) as a cumulative-effect adjustment as of the date of adoption. The adoption of ASU 2014-09 will not have a significant effect on the Company’s consolidated financial position, results of operations or cash flows.

Recent Accounting Pronouncements — In April 2015, the FASB issued ASU 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that loan costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts or premiums. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The ASU is to be applied retrospectively for each period presented. Upon adoption, an entity is required to comply with the applicable disclosures for a change in an accounting principle. The FASB subsequently issued ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements,” which clarifies that, given the absence of authoritative guidance in ASU 2015-03 regarding presentation and subsequent measurement of loan costs related to line-of-credit arrangements, the SEC Staff would not object to an entity deferring and presenting loan costs as an asset and subsequently amortizing the loan costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company has determined that it will not early adopt this ASU and that the amendments will not materially impact the presentation of the Company’s consolidated financial position and will not have a material impact on the Company’s consolidated results of operations or cash flows.

7

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

2. Significant Accounting Policies (Continued):

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments,” which requires an acquirer to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The Company has determined that it will not early adopt this ASU and does not expect that adopting this guidance will have a material impact on its consolidated financial position, results of operations or cash flows.

3. Real Estate Investment Properties, net:

As of September 30, 2015 and December 31, 2014, real estate investment properties consisted of the following (in thousands):

	September 30, 2015			December 31, 2014
Land and land improvements	$	415,783		$	415,968
Leasehold interests and improvements		178,511			180,514
Buildings		272,917			273,210
Equipment		536,433			520,060
Less: accumulated depreciation and amortization		(562,068	)		(507,663	)
Total	$	841,576		$	882,089

For the quarter and nine months ended September 30, 2015, the Company had depreciation and amortization expenses of approximately $19.6 million and $63.0 million, respectively, as compared to approximately $25.2 million and 72.7 million, respectively, for the quarter and nine months ended September 30, 2014, excluding properties that the Company classified as discontinued operations.

4. Assets and Associated Liabilities Held for Sale, net and Discontinued Operations:

Assets Held for Sale, net — The Company had 22 and 61 properties classified as assets held for sale as of September 30, 2015 and December 31, 2014, respectively. The following table presents the net carrying value of the properties classified as held for sale (in thousands):

	September 30, 2015		December 31, 2014
Land and land improvements	$	57,711	$	213,129
Leasehold interests and improvements		48,910		52,589
Building and building improvements		106,510		599,923
Equipment, net		31,312		59,345
Deferred rent and lease incentives		—		4,832
Other assets		7,426		10,919
Restricted cash		5,938		14,714
Intangibles, net		1,027		10,503
Accounts and other receivables, net		451		2,687
Total	$	259,285	$	968,641

8

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

4. Assets and Associated Liabilities Held for Sale, net and Discontinued Operations (continued):

Associated Liabilities Held for Sale — The following table presents the liabilities associated with the assets held for sale related to the senior housing properties (in thousands):

	September 30,		December 31,
	2015		2014
Mortgages and other notes payable	$	—	$	152,655
Other liabilities		—		19,090
Total	$	—	$	171,745

During the nine months ended September 30, 2015, the Company sold all 38 of its senior housing properties and received aggregate net sales proceeds of approximately $623.4 million, which resulted in a gain of approximately $210.6 million for financial reporting purposes. No disposition fee was payable to the Advisor on the sale of the senior housing properties. The third party buyer of the properties assumed $151.5 million of outstanding principal indebtedness collateralized by the senior housing properties that were sold.

In June 2015, the Company sold one of its attractions properties and received net sales proceeds of approximately $134.5 million, which resulted in a gain of approximately $25.7 million for financial reporting purposes. The Company did not pay the Advisor a disposition fee.

During the nine months ended September 30, 2015, the Company recorded approximately $7.7 million in impairment provisions related to the marinas properties (recorded as part of discontinued operations) and recorded $1.4 million in impairment provisions related to its undeveloped land, to adjust their net carrying value to their revised estimated sale price, less closing costs.

Discontinued Operations — The Company classified the revenues and expenses related to all real estate properties sold in 2014, the 37 senior housing properties sold in May 2015 and the one senior housing sold in September 2015, and 17 marinas properties classified as assets held for sale as of December 31, 2014, as discontinued operations in the accompanying unaudited condensed consolidated statements of operations for all periods presented.

The following table is a summary of income (loss) from discontinued operations for the quarter and nine months ended September 30, 2015 and 2014 (in thousands):

	Quarter Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Revenues	$	12,482		$	51,619		$	60,496		$	146,468
Expenses		(10,286	)		(34,256	)		(43,774	)		(94,297	)
Impairment provision		—			—			(7,749	)		(3,442	)
Depreciation and amortization		—			(8,233	)		—			(28,403	)
Operating income		2,196			9,130			8,973			20,326
Gain from sale of real estate		4,266			3,953			210,891			3,883
Gain (loss) on extinguishment of debt (1)		486			(8,293	)		(2,042	)		(5,690	)
Gain on insurance and retirements		1,024			—			1,492			—
Other expense (2)		(358	)		(4,253	)		(4,928	)		(19,887	)
Income (loss) from discontinued operations	$	7,614		$	537		$	214,386		$	(1,368	)

9

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

4. Assets and Associated Liabilities Held for Sale, net and Discontinued Operations (continued):

FOOTNOTES:

⁽¹⁾  During the quarter and nine months ended September 30, 2015, the Company recorded gain (loss) on extinguishment of debt from the sale of one and 38 senior housing properties, respectively. During the quarter and nine months ended September 30, 2014, the Company recorded loss on extinguishment of debt from the sale of its 46 golf properties. In addition, during the nine months ended September 30, 2014, the Company recorded gain on extinguishment of debt from the sale of its multi-family residential property.

⁽²⁾  Amounts include amortization of loss and loss on termination of cash flow hedge of approximately $3.0 million for the nine months ended September 30, 2014.

The Company accounted for the revenues and expenses related to one attractions property sold in June 2015, one undeveloped land, one ski and mountain lifestyle and three attractions properties classified as held for sale, as income from continuing operations because the sale of these properties would not cause a strategic shift in the Company nor are they considered to have a major impact on the Company’s business; therefore, they do not qualify as discontinued operations under ASU 2014-08. However, the proposed disposition of the one ski and mountain lifestyle property will represent an individually significant component. The Company recorded net income from continuing operations of approximately $4.0 million and $6.9 million for the quarter and nine months ended September 30, 2015, respectively, and a net income (loss) from continuing operations of $1.9 million and $(0.1) million for the quarter and nine months ended September 30, 2014, respectively, related to the one ski and mountain lifestyle property classified as held for sale.

5. Intangibles, net:

The gross carrying amount and accumulated amortization of the Company’s intangible assets as of September 30, 2015 and December 31, 2014 are as follows (in thousands):

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			September 30, 2015 Net Book Value
In place leases	$	11,479	$	(4,857	)	$	6,622
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,305	$	(4,857	)	$	17,448

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			December 31, 2014 Net Book Value
In place leases	$	11,584	$	(4,399	)	$	7,185
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,410	$	(4,399	)	$	18,011

For each of the quarters and nine months ended September 30, 2015 and 2014, the Company had amortization expense of approximately $0.2 million and $0.5 million, respectively, excluding properties that the Company classified as discontinued operations.

10

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

6. Unconsolidated Entities:

As of December 31, 2014, the Company held an ownership interest in the DMC Partnership of $104.4 million. The Company sold its 81.98% interest in the DMC Partnership in April 2015 and received net sales proceeds of approximately $139.5 million from its co-venture partner, which resulted in a gain of approximately $39.3 million for financial reporting purposes. No disposition fee was paid to the Advisor on the sale of the DMC Partnership. The Company accounted for its pro-rata share of the net earnings of its investment in the DMC Partnership as continuing operations because although the properties owned by the DMC Partnership were outliers compared to the other assets invested in by the Company, the sale of the Company’s interest in the DMC Partnership did not cause a strategic shift in the Company, and it was not considered to have a major impact on the Company’s business; therefore, it did not qualify as discontinued operations under ASU 2014-08.

As of December 31, 2014, the Company held an 80% ownership interest in the Intrawest Venture. During the nine months ended September 30, 2015, the Company contributed approximately $54.6 million to the Intrawest Venture and the Intrawest Venture repaid mortgage loans of approximately $54.6 million. In July 2015, the co-venture partner of the Intrawest Venture accepted the Company’s offer to acquire the co-venture partner’s 20% interest in the Intrawest Venture in accordance with the buy-sell provisions of the Intrawest Venture partnership agreement. The Company will own a 100% controlling interest in the Intrawest Venture once it acquires the remaining 20% interest from the co-venture partner.

The Intrawest Venture is working with the Canada Revenue Agency to resolve matters related to its entities. The Intrawest Venture’s maximum exposure relating to these matters is approximately $12.1 million. However, the Intrawest Venture believes the more likely than not resolution will be approximately $1.5 million. As such, an accrual of $1.5 million has been reflected in the financial information of the Intrawest Venture.

The following tables present financial information for the Company’s unconsolidated entities for the quarters and nine months ended September 30, 2015 and 2014 (in thousands):

Summarized operating data:

	Quarter Ended September 30, 2015
	DMC Partnership(3)		Intrawest Venture			Total
Revenues	$	—	$	4,503		$	4,503
Property operating expenses		—		(2,449	)		(2,449	)
Depreciation and amortization		—		(807	)		(807	)
Interest expense		—		(476	)		(476	)
Net income	$	—	$	771		$	771
Loss allocable to other venture partners (1)	$	—	$	(408	)(2)	$	(408	)
Income allocable to the Company (1)	$	—	$	1,179		$	1,179
Amortization of capitalized costs		—		(17	)		(17	)
Equity in earnings of unconsolidated entities	$	—	$	1,162		$	1,162
Distribution declared to the Company	$	—	$	1,592		$	1,592
Distributions received by the Company	$	—	$	918		$	918

11

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

6. Unconsolidated Entities (continued):

	Quarter Ended September 30, 2014
	DMC Partnership			Intrawest Venture			Total
Revenues	$	6,870		$	4,856		$	11,726
Property operating expenses		(305	)		(2,472	)		(2,777	)
Depreciation and amortization		(2,327	)		(1,118	)		(3,445	)
Interest expense		(1,909	)		(1,241	)		(3,150	)
Net income	$	2,329		$	25		$	2,354
Loss allocable to other venture partners (1)	$	(532	)	$	(406	)(2)	$	(938	)
Income allocable to the Company (1)	$	2,861		$	431		$	3,292
Amortization of capitalized costs		(64	)		(52	)		(116	)
Equity in earnings of unconsolidated entities	$	2,797		$	379		$	3,176
Distribution declared to the Company	$	2,859		$	742		$	3,601
Distributions received by the Company	$	2,829		$	492		$	3,321

	Nine Months Ended September 30, 2015
	DMC Partnership(3)			Intrawest Venture			Total
Revenues	$	10,743		$	13,809		$	24,552
Property operating expenses		(173	)		(7,788	)		(7,961	)
Depreciation and amortization		(3,038	)		(3,375	)		(6,413	)
Interest expense		(1,555	)		(2,294	)		(3,849	)
Net income	$	5,977		$	352		$	6,329
Income (loss) allocable to other venture partners (1)	$	3,477		$	(1,204	)(2)	$	2,273
Income allocable to the Company (1)	$	2,500		$	1,556		$	4,056
Amortization of capitalized costs		(25	)		(91	)		(116	)
Equity in earnings of unconsolidated entities	$	2,475		$	1,465		$	3,940
Distribution declared to the Company	$	3,698		$	6,142		$	9,840
Distributions received by the Company	$	6,558		$	5,093		$	11,651

12

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

6. Unconsolidated Entities (continued):

	Nine Months Ended September 30, 2014
	DMC Partnership			Intrawest Venture			Total
Revenues	$	21,649		$	14,694		$	36,343
Property operating expenses		(569	)		(7,654	)		(8,223	)
Depreciation and amortization		(6,779	)		(5,455	)		(12,234	)
Interest expense		(5,743	)		(3,889	)		(9,632	)
Net income (loss)	$	8,558		$	(2,304	)	$	6,254
Income (loss) allocable to other venture partners (1)	$	72		$	(1,205	)(2)	$	(1,133	)
Income (loss) allocable to the Company (1)	$	8,486		$	(1,099	)	$	7,387
Amortization of capitalized costs		(280	)		(158	)		(438	)
Equity in earnings (loss) of unconsolidated entities	$	8,206		$	(1,257	)	$	6,949
Distribution declared to the Company	$	8,485		$	1,892		$	10,377
Distributions received by the Company	$	8,485		$	1,411		$	9,896

FOOTNOTES:

⁽¹⁾  Income (loss) is allocated between the Company and its venture partner using the hypothetical liquidation book value (“HLBV”) method of accounting.

⁽²⁾  This amount includes the venture partner’s portion of interest expense on a loan which the partners made to the venture. These amounts are treated as distributions for the purposes of the HLBV calculation.

⁽³⁾  On April 29, 2015, the Company completed the sale of its interest in the DMC Partnership as described above. As such, summarized operating data for the partnership is reported through April 29, 2015.

7. Mortgages and Other Notes Receivable, net:

During the nine months ended September 30, 2015, the borrower relating to one mortgage receivable, for which the Company restructured the mortgage loan during 2014, continued to experience financial difficulties. Additionally, during the nine months ended September 30, 2015, the Company entered into an agreement to receive an early repayment of its other mortgage receivable at a discounted amount. The Company recorded both mortgage receivables at their net realizable value during the nine months ended September 30, 2015 and in conjunction therewith, recorded loan loss provisions of approximately $9.4 million during the nine months ended September 30, 2015. During the nine months ended September 30, 2015, the Company collected the discounted amount for one of its mortgage receivable. In October 2015, the Company collected its other mortgage receivable at a discounted amount as further described below in Note 14. “Subsequent Events.”

The estimated fair market value of the Company’s one mortgage and other notes receivable was approximately $7.6 million as of September 30, 2015, and $16.6 million as of December 31, 2014 for the two mortgages and other notes receivable, respectively, based on the fair value of the collateral or expected collectible amount as of September 30, 2015 and based on discounted cash flows at December 31, 2014. Because this methodology includes inputs that are not observable by the public and are not necessarily reflected in active markets, the measurement of the estimated fair values related to the Company’s mortgage and other notes receivable is categorized as Level 3 on the three-level valuation hierarchy. The estimated fair value of accounts and other receivables approximates the carrying value as of September 30, 2015 and December 31, 2014 because of the relatively short maturities of the receivables.

13

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

8. Indebtedness:

Line of Credit — During the nine months ended September 30, 2015, the Company repaid approximately $152.5 million of principal. In June 2015, the Company extended the maturity date of its revolving line of credit to August 31, 2016, with an additional one year extension option, and reduced the borrowing capacity to $100 million. As of September 30, 2015, the Company’s revolving line of credit did not have an outstanding principal balance.

Senior Unsecured Notes — In June 2015, the Company repaid all of its senior unsecured notes with an outstanding principal balance of $318.3 million at a premium of 103.625%. In connection with this repayment, the Company recorded a loss on extinguishment of debt of approximately $18.8 million.

Fixed and Variable Rate Debt — During the nine months ended September 30, 2015, the Company repaid approximately $209.7 million of outstanding indebtedness prior to their scheduled maturity and recorded a loss on extinguishment of debt of approximately $4.3 million, which included a prepayment penalty of $1.3 million. Also, in connection with the sale of its 38 senior housing properties, the buyer of these properties assumed approximately $151.5 million of outstanding indebtedness collateralized by the senior housing properties that were sold.

Certain of the Company’s loans require the Company to meet certain customary financial covenants and ratios including fixed charge coverage ratio, leverage ratio, interest coverage ratio and limitations on distributions except as required to maintain the Company’s REIT status. The Company was in compliance with all applicable provisions as of September 30, 2015.

The estimated fair values of mortgages and other notes payable, including those related to assets held for sale, and the line of credit were approximately $194.2 million and $707.3 million as of September 30, 2015 and December 31, 2014, respectively, based on rates and spreads the Company would expect to obtain for similar borrowings with similar loan terms. Because this methodology includes inputs that are less observable by the public and are not necessarily reflected in active markets, the measurement of the estimated fair values related to the Company’s mortgage notes payable is categorized as Level 3 on the three-level valuation hierarchy. The estimated fair values of the senior notes was approximately $325.4 million as of December 31, 2014, based on prices traded for similar or identical instruments in active or inactive markets and were categorized as Level 2 on the three-level valuation hierarchy. The senior notes were repaid in June 2015 as described above. The estimated fair value of accounts payable and accrued expenses approximates the carrying value as of September 30, 2015 and December 31, 2014 because of the relatively short maturities of the obligations.

9. Fair Value Measurements:

The Company had 19 investment properties that were classified as assets held for sale at September 30, 2015 and December 31, 2014, respectively, that were recorded at fair value less estimated costs to sell for each period presented. The Level 3 unobservable inputs used in determining the fair value of the real estate properties included negotiated sales prices with third party buyers, comparable sales transactions and information from potential buyers.

As of December 31, 2014, the Company had two hedges that qualified as highly effective and, accordingly, all of the change in value was reflected in other comprehensive income (loss). During the nine months ended September 30, 2015, one of the loans was paid in full and the corresponding interest rate swap with an aggregate notional amount of approximately $14.2 million was terminated. As a result, the ineffective portion of the change in fair value resulting from the termination of the hedge included in other comprehensive loss in the accompanying condensed consolidated balance sheets was reclassified to interest expense and loan cost amortization in the accompanying condensed consolidated statements of operations in income (loss) from continuing operations for the nine months ended September 30, 2015. As of September 30, 2015, the Company had one interest rate swap with a notional amount of approximately $8.1 million. Determining fair value and testing effectiveness of this financial instrument requires management to make certain estimates and judgments. Changes in assumptions could have a positive or negative impact on the estimated fair values and measured effectiveness of such instruments could, in turn, impact the Company’s results of operations.

The Company’s derivative instruments are valued primarily based on inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, volatilities, and credit risks) and are classified as Level 2 in the fair value hierarchy. The valuation of derivative instruments also includes a credit value adjustment which is a Level 3 input. However, the impact of the assumption is not significant to its overall valuation calculation, and therefore the Company considers its derivative

14

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

9. Fair Value Measurements (continued):

instruments to be classified as Level 2. The fair value of such instruments is included in other liabilities in the accompanying unaudited condensed consolidated balance sheets.

The following tables show the fair value of the Company’s financial assets and liabilities carried at fair value as of September 30, 2015 and December 31, 2014, as follows (in thousands):

	Fair Value Measurement as of September 30, 2015		Level 1		Level 2		Level 3
Assets:
Assets held for sale carried at fair value	$	116,489	$	—	$	—	$	116,489
Liabilities:
Derivative instruments	$	724	$	—	$	724	$	—

	Fair Value Measurement as of December 31, 2014		Level 1		Level 2		Level 3
Assets:
Assets held for sale carried at fair value	$	122,126	$	—	$	—	$	122,126
Liabilities:
Derivative instruments	$	1,002	$	—	$	1,002	$	—

10. Related Party Arrangements:

In March 2014, the Company’s Advisor amended its advisory agreement, effective April 1, 2014, to eliminate all acquisition fees on equity, performance fees, debt acquisition fees and disposition fees, and to reduce asset management fees to 0.075% monthly (or 0.90% annually) of invested assets.

For the quarters and nine months ended September 30, 2015 and 2014, respectively, the Advisor collectively earned fees and incurred reimbursable expenses as follows (in thousands):

	Quarters Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Acquisition fees:
Acquisition fees from distribution reinvestment plan (1)	$	—	$	—	$	—	$	319
Acquisition fees from debt proceeds (2)		—		—		—		1,521
Total		—		—		—		1,840
Asset management fees (3)		3,702		7,506		15,853		23,584
Reimbursable expenses: (4)
Acquisition costs		—		64		—		202
Operating expenses		1,157		1,710		4,286		5,213
Total		1,157		1,774		4,286		5,415
Total fees earned and reimbursable expenses	$	4,859	$	9,280	$	20,139	$	30,839

15

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

10. Related Party Arrangements (continued):

FOOTNOTES:

⁽¹⁾  Amounts are recorded as acquisition fees and costs in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the Advisor eliminated this fee going forward.

⁽²⁾  Amounts are recorded as loan costs and are included as part of other assets in the accompanying unaudited condensed consolidated balance sheets. Effective April 1, 2014, the Advisor eliminated this fee going forward.

⁽³⁾  Amounts are recorded as asset management fees to Advisor including fees related to properties that are classified as assets held for sale that are included as discontinued operations in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the asset management fees to Advisor were reduced as described above.

⁽⁴⁾  Amounts representing acquisition costs are recorded as part of acquisition fees and costs in the accompanying condensed consolidated statements of operations. Amounts representing operating expenses are recorded as part of general and administrative expenses in the accompanying unaudited condensed consolidated statements of operations.

Amounts due to affiliates for fees and expenses described above are as follows (in thousands):

	September 30, 2015		December 31, 2014
Due to the Advisor and its affiliates:
Operating expenses	$	415	$	476
Acquisition fees and expenses		—		13
Total	$	415	$	489

11. Stockholders’ Equity:

Distribution Reinvestment Plan — For the nine months ended September 30, 2014, the Company received aggregate proceeds of approximately $27.2 million (representing 4.0 million shares) through its DRP. On September 4, 2014, the Company’s board of directors approved the suspension of its DRP, effective as of September 26, 2014. As a result of the suspension of the DRP, beginning with the September 2014 quarterly distributions, stockholders who were participants in the DRP received cash distributions instead of additional shares in the Company. The Company did not receive any proceeds through its DRP for the nine months ended September 30, 2015.

Distributions — In March 2015, the Company’s board of directors reduced the quarterly distributions from $0.1063 per share to $0.05 per share to stockholders of record at the close of business on March 9, 2015. For the nine months ended September 30, 2015 and 2014, the Company declared and paid distributions of approximately $48.8 million ($0.15 per share) and $103.3 million ($0.3189 per share), respectively.

12. Supplemental Guarantor Information:

As of December 31, 2014, the Company had senior notes outstanding which were guaranteed by certain of the Company’s consolidated subsidiaries (the “Guarantor Subsidiaries”). As described in Note 8, “Indebtedness,” in June 2015, the Company repaid all of its senior unsecured notes with an outstanding principal amount of $318.3 million at a premium of 103.625%.

13. Commitments and Contingencies:

From time to time the Company may be exposed to litigation arising from operations of its business in the ordinary course of business. Management is not aware of any litigation that it believes will have a material adverse impact on the Company’s financial condition or results of operations.

16

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2015

(UNAUDITED)

14. Subsequent Events:

In October 2015, the Company entered into a purchase and sale agreement for two of its attraction properties for $62.0 million, which exceeds the carrying value of the properties.

In October 2015, the Company collected its only outstanding mortgage receivable.

In November 2015, we entered into a purchase and sale agreement for one of our ski and mountain lifestyle properties for $90.5 million, which exceeds the carrying value of the property.

17

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

INTRODUCTION

The following discussion is based on our unaudited condensed consolidated financial statements as of September 30, 2015 and December 31, 2014 and for the quarter and nine months ended September 30, 2015 and 2014 of CNL Lifestyle Properties, Inc. and its subsidiaries (hereinafter referred to as the “Company,” “we,” “us,” or “our”). Amounts as of December 31, 2014 included in the unaudited condensed consolidated financial statements have been derived from the audited consolidated financial statements as of that date. This information should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and the notes thereto, as well as the audited consolidated financial statements, notes and management’s discussion and analysis included in our Annual Report on Form 10-K for the year ended December 31, 2014. Capitalized terms used in this Item 2 have the same meaning as in the accompanying condensed financial statements.

Cautionary Note Regarding Forward-Looking Statements

Statements in this Quarterly Report on Form 10-Q for the nine months and the quarter ended September 30, 2015 may constitute “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements be subject to the safe harbor created by Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements are statements that do not relate strictly to historical or current facts, but reflect management’s current understandings, intentions, beliefs, plans, expectations, assumptions and/or predictions regarding the future of the Company’s business and its performance, the economy, and other future conditions and forecasts of future events and circumstances. Forward-looking statements are typically identified by words such as “believes,” “expects,” “anticipates,” “intends,” “estimates,” “plans,” “continues,” “pro forma,” “may,” “will,” “seeks,” “should” and “could,” and words and terms of similar substance in connection with discussions of future operating or financial performance, business strategy and portfolios, projected growth prospects, cash flows, costs and financing needs, legal proceedings, amount and timing of anticipated future distributions, estimated of per share net asset value of the Company’s common stock, and/or other matters. The Company’s forward-looking statements are not guarantees of future performance. While the Company’s management believes its forward-looking statements are reasonable, such statements are inherently susceptible to uncertainty and changes in circumstances. As with any projection or forecast, forward-looking statements are necessarily dependent on assumptions, data and/or methods that may be incorrect or imprecise, and may not be realized. The Company’s forward-looking statements are based on management’s current expectations and a variety of risks, uncertainties and other factors, many of which are beyond the Company’s ability to control or accurately predict. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company’s actual results could differ materially from those set forth in the forward-looking statements due to a variety of risks, uncertainties and other factors.

Important factors that could cause the Company’s actual results to vary materially from those expressed or implied in its forward-looking statements include, but are not limited to, government regulation, economic, strategic, political and social conditions, and the following: illiquidity of the investment, risks associated with the Company’s inability to identify a liquidity event or other strategic alternative or, if identified, the Company’s inability to complete such a transaction on favorable terms or at all, and liquidation at less than the subscription price of the stock; the impact of regulations requiring periodic valuation of the Company on a per share basis, including the uncertainties inherent in such valuations and liquidation at less than the estimated net asset value; risks associated with the Company’s investment strategy; history of losses; no guarantee of distributions; reliance on the Company’s advisor and its affiliates, including, conflicts of interest, and the payment of substantial fees to the advisor and its affiliates; a worsening economic environment in the U.S. or globally, including financial market fluctuations; risks associated with real estate markets, including declining real estate values; the use of debt to finance the Company’s business activities, including refinancing and interest rate risk and the Company’s failure to comply with debt covenants; the Company’s inability to make necessary improvements to properties on a timely or cost-efficient basis; competition for properties and/or tenants; defaults on or non-renewal of leases by tenants; failure to lease properties on favorable terms or at all; the impact of current and future environmental, zoning and other governmental regulations affecting the Company’s properties; the impact of changes in accounting rules; inaccuracies of the Company’s accounting estimates; unknown liabilities of acquired properties or liabilities caused by property managers or operators; material adverse actions or omissions by any joint venture partners; increases in operating costs and other expenses; uninsured losses or losses in excess of the Company’s insurance coverage; the impact of outstanding and/or potential litigation; risks associated with the Company’s tax structuring; failure to maintain the Company’s REIT qualification; and the Company’s inability to protect its intellectual property and the value of its brand. Given these uncertainties, the Company cautions you not to place undue reliance on such statements.

For further information regarding risks and uncertainties associated with the Company’s business and other important factors that could cause the Company’s actual results to vary materially from those expressed or implied in its forward-looking statements, please refer to the factors listed and described in the Company’s reports filed from time to time with the Securities and Exchange Commission, including, but not limited to, the Company’s quarterly reports on Form 10-Q and the Company’s annual report on Form 10-K, copies of which may be obtained from the Company’s website at www.cnllifestylereit.com.

18

All written and oral forward-looking statements attributable to the Company or persons acting on its behalf are qualified in their entirety by this cautionary note. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to, and expressly disclaims any obligation to, publicly release the results of any revisions to its forward-looking statements to reflect new information, changed assumptions, the occurrence of unanticipated subsequent events or circumstances, or changes to future operating results over time, except as otherwise required by law.

GENERAL

CNL Lifestyle Properties, Inc. is a Maryland corporation incorporated on August 11, 2003. We were formed primarily to acquire lifestyle properties in the United States that we generally lease on a long-term, triple-net basis (generally five to 20 years, plus multiple renewal options) to tenants or operators that we consider to be industry leading. We also engage third-party managers to operate certain properties on our behalf as permitted under applicable tax regulations. We define lifestyle properties as those properties that reflect or are impacted by the social, consumption and entertainment values and choices of our society. When beneficial to our investment structure and as a result of tenant defaults, we engage third-party managers to operate certain properties on our behalf as permitted under applicable tax regulations. We also made loans (including mortgage, mezzanine and other loans) generally collateralized by interests in real estate. We engaged CNL Lifestyle Advisor Corporation (the “Advisor”) as our Advisor to provide management, acquisition, disposition, advisory and administrative services.

Our principal business objectives included investing in and owning a diversified portfolio of real estate with a goal to preserve, protect and enhance the long-term value of those assets. We built a portfolio of properties that we considered to be well-diversified by region, asset type and operator. In March 2014, we engaged Jefferies LLC, a leading global investment banking and advisory firm, to assist management and the board of directors in actively evaluating various strategic opportunities including the sale of either us or our assets, potential merger opportunities, or the listing of our common stock. See “Our Exit Strategy” below for additional information.

We currently operate and have elected to be taxed as a REIT for federal income tax purposes. As a REIT, we generally will not be subject to federal income tax at the corporate level to the extent that we distribute at least 100% of our REIT taxable income and capital gains to our stockholders and meet other compliance requirements. We are subject to income taxes on taxable income from certain properties operated by third-party managers. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax on all of our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year in which our qualification is lost. Such an event could materially and adversely affect our operating results and cash flows. However, we believe that we are organized and have operated in a manner to qualify for treatment as a REIT beginning with the year ended December 31, 2004. In addition, we intend to continue to be organized and to operate so as to remain qualified as a REIT for federal income tax purposes.

Our Exit Strategy

As required under our articles of incorporation, we began a process of evaluating strategic alternatives in an effort to undertake to provide stockholders with liquidity of their investment by December 31, 2015, either in whole or in part, including, without limitation, through (i) the commencement of an orderly sale of our assets, outside of the ordinary course of business and consistent with our objectives of qualifying as a REIT, and the distribution of the net sales proceeds thereof to the stockholders or (ii) our merger with or into another entity in a transaction which provides the stockholders with cash or securities of a publicly traded company or (iii) a listing of our shares on a national stock exchange (“Listing”). In accordance with our undertaking to provide stockholders with partial liquidity, we intend to use a portion of net sales proceeds received from the sale of real estate during the nine months ended September 30, 2015 and any net sales proceeds from the proposed sale of other properties during the remainder of 2015 to make a special distribution to stockholders by the end of 2015.

We will seek to maximize the total value of our portfolio in connection with our evaluation of various strategic opportunities in preparation for an exit strategy. In connection with these objectives, in March 2014, we engaged Jefferies LLC, a leading global investment banking and advisory firm, to assist management and the board of directors in actively evaluating various strategic opportunities including the sale of either us or our assets, potential merger opportunities, or the Listing of our common stock. In connection with this process, during 2014 we sold our entire golf portfolio (consisting of 48 properties) and our multi-family development property. During 2015 and through November 5, 2015, we (i) sold our 81.98% interest in the DMC Partnership for net sales proceeds of approximately $139.5 million to our co-venture partner, (ii) sold all 38 of our senior housing properties and one attractions property for aggregate net sales proceeds of approximately $757.9 million, (iii) entered into a purchase and sale agreement for the sale of our marinas portfolio for approximately its carrying value, (iv) had purchase and sale agreements in place to sell three attraction properties and a ski and mountain lifestyle property, and (v) a plan to sell our undeveloped land.

We used the net sales proceeds from the 2015 sales described above and other cash on hand to repay $152.5 million on our line of credit, repay $209.7 million in outstanding indebtedness and to repay all of our senior unsecured notes with a principal balance of $318.3 million at a premium of 103.625%. We intend to use a portion of existing net sales proceeds received from the sale of real estate during the nine months ended September 30, 2015 and any net sales proceeds from the proposed sale of other properties during

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the remainder of 2015 to make a special distribution to stockholders by the end of 2015. We may also use a portion of these net sales proceeds to make strategic capital expenditures to enhance certain of our remaining properties and/or for other corporate purposes. We are evaluating the sale of other assets as part of our strategic alternatives.

As of November 5, 2015, we had a portfolio of 65 lifestyle properties, of which 22 properties had been classified as held for sale. When aggregated by initial purchase price, the portfolio was diversified as follows: approximately 49% in ski and mountain lifestyle, 36% in attractions, 12% in marinas and 3% in additional lifestyle.

Portfolio Trends

A large number of the properties in our real estate portfolio are operated by third-party tenant operators under long-term triple-net leases for which we report rental income and are not directly exposed to the variability of property-level operating revenues and expenses. We also engage third-party managers to operate certain properties on our behalf for which we record the property-level operating revenues and expenses and are directly exposed to the variability of the property’s operations which impacts our results of operations. We believe that the financial and operational performance of our tenants and managers, and the general conditions of the industries within which they operate, provide indicators about our tenants’ health and their ability to pay contractually obligated rent. For example, positive growth in visitation and per capita spending may result in our receipt of additional percentage rent and, better rent coverage, while, conversely, declines may impact our tenants’ ability to pay rent to us.

The following table illustrates property level revenues and EBITDA reported to us by our tenants and managers for the asset types below and includes both our leased and managed properties. We have not included performance data on acquisitions made after January 1, 2014 or properties sold during the periods presented because we did not own those properties during the entirety of all periods presented below. We have only included property-level operating performance for consolidated properties in the table below. Property-level operating performance from our unconsolidated properties has been excluded because we do not believe it is as relevant and meaningful particularly since we are entitled to receive cash distribution preferences where we receive a stated return on our investment each year ahead of our partners. Our tenants and managers are contractually required to provide this information to us in accordance with their respective lease and management agreements. While this information has not been audited, it has been reviewed by management to determine whether the information is reasonable and accurate in all material respects. In connection with this review, management reviews monthly property level operating performance versus budgeted expectations, conducts periodic operational review calls with operators and conducts periodic property inspections. We monitor the credit of our tenants by reviewing their rental payment history, timeliness of rent collections, their operational performance on our properties and by monitoring news and industry reports regarding our tenants and their underlying businesses. We have aggregated this performance data on a “same-store” basis only for comparable properties that we have owned during the entirety of all periods presented and have included information for both leased and managed properties. For these reasons, we consider the property level data to be performance information that gives us information on trends which does not directly represent our results of operations. We do not consider this information to be a non-GAAP measure which can be reconciled to our GAAP financial statements because it includes the performance of properties that are leased to third-party tenants. However, we believe this information is useful to help readers of our financial statements understand and evaluate trends, events and uncertainties in our business as it relates to our prior periods and to broader industry performance (in thousands):

			Quarter Ended September 30,
	Number of		2015					2014					Increase (Decrease)
	Properties		Revenue (1)		EBITDA (1)			Revenue (1)		EBITDA (1)			Revenue			EBITDA
Ski and mountain lifestyle		17	$	53,263	$	(5,147	)	$	51,132	$	(6,560	)		4.2	%		21.5	%
Attractions		22		130,987		62,036			120,495		57,331			8.7	%		8.2	%
Marinas(2)		17		12,310		4,474			12,073		4,475			2.0	%		0.0	%
Total		56	$	196,560	$	61,363		$	183,700	$	55,246			7.0	%		11.1	%

			Nine Months Ended September 30,
	Number of		2015				2014				Increase (Decrease)
	Properties		Revenue (1)		EBITDA (1)		Revenue (1)		EBITDA (1)		Revenue			EBITDA
Ski and mountain lifestyle		17	$	312,147	$	77,298	$	331,994	$	90,088		(6.0	)%		(14.2	)%
Attractions		22		238,119		79,629		217,503		67,810		9.5	%		17.4	%
Marinas(2)		17		27,386		8,634		26,574		8,543		3.1	%		1.1	%
Total		56	$	577,652	$	165,561	$	576,071	$	166,441		0.3	%		(0.5	)%

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FOOTNOTE:

⁽¹⁾  Property operating results for tenants under leased arrangements are not included in the company’s operating results. Property-level EBITDA above is disclosed before rent and capital reserve payments to us, as applicable.

⁽²⁾  The marinas properties were held for sale as of September 30, 2015.

Overall, for the quarter ended September 30, 2015, our tenants and managers reported to us an increase in property-level revenue and EBITDA of 7.0% and 11.1%, respectively, as compared to the same period in the prior year. For our ski and mountain assets, those properties with summer operations saw generally strong revenues during the quarter ended September 30, 2015 from increased visitation and group business, which was bolstered by increased activity offerings at several resorts. Operators with resorts in the Pacific West which struggled through a difficult 2014-15 winter season successfully implemented tight labor controls and various operating cost reduction programs, helping to improve EBITDA over the prior year period. Our attractions properties, whose peak season falls within the summer months, also experienced an increase in revenues driven by the combination of favorable weather and effective operating strategies which continue to result in increased attendance.

Overall, for the nine months ended September 30, 2015, our tenants and managers reported to us an increase in property-level revenue of 0.3% and decrease in EBITDA of 0.5%, as compared to the same period in the prior year. The increase in property-level revenue was primarily due to improved summer operations at our attractions properties. The attractions properties, whose peak season falls within the summer months, exhibited an increase due to improved season pass sales, expanded group sales, and better in-park spending which was enhanced by favorable weather. The increase in property-level revenue attributable to our attractions properties was partially offset by our ski and mountain lifestyle properties, which saw mixed results for the 2014-15 winter season based on geographic region, but also a generally strong summer operating period. Along the West Coast, record-breaking drought conditions continued for the third straight season in California, coupled with unusually low snowfall and warmer than average temperatures in the Pacific Northwest which significantly reduced skier visit volumes, and permitted some resorts to open only on an exceptionally limited basis. In contrast, the Northeast saw ample snowfall and cold temperatures from numerous winter storm cycles, driving strong visitation though April. The Rocky Mountain region saw a balanced if not moderately strong season throughout, with skier visits in line with forecasted expectations.

Seasonality

Many of the asset classes in which we invest experience seasonal fluctuations due to the nature of their business, geographic location, climate and weather patterns. As a result, these businesses experience seasonal variations in revenues that may require our operators to supplement operating cash from their properties in order to be able to make scheduled rent payments to us. We have structured the leases for certain tenants such that rents are paid on a seasonal schedule with most, if not all, of the rent being paid during the tenant’s seasonally busy operating period.

As part of our portfolio diversification strategy, we have specifically considered the varying and complimentary seasonality of our asset classes and portfolio mix. For example, the peak operating season for our ski and mountain lifestyle assets is highly complementary to the peak seasons for our attractions and marinas to balance and mitigate the risks associated with seasonality. Generally, seasonality does not significantly affect our recognition of rental income from operating leases due to straight-line revenue recognition in accordance with GAAP. However, seasonality may impact the timing of when base rent payments are made by our tenants, which impacts our operating cash flows. Additionally, seasonality affects the amount of rental revenue we recognize in connection with capital improvement reserve revenue and percentage rents paid by our tenants, which is recognized in the period in which it is earned and is generally based on a percentage of tenant revenues.

Seasonality also directly impacts certain of our properties where we engage independent third-party operators to manage on our behalf and where we record property operating revenues and expenses rather than straight-line rents from operating leases. These properties will likely generate net operating losses during their non-peak months while generating most, if not all, of their operating income during their peak operating months. Our consolidated operating results and cash flows during the first, second and fourth quarters will be lower than the third quarter primarily due to the non-peak operating months of our larger attractions properties.

Bad Debt Expense, Loan Provisions and Impairments

During 2014, one of our ski tenants with two leases on properties in the Pacific-West began experiencing financial difficulties and we recorded a loss on lease termination (representing the write-off of straight-line rents) during 2014. During 2015, this tenant has been unable to pay rent due to lower operating results from the continued low levels of snow accompanied by unusually warm weather. As a result, during the nine months ended September 30, 2015, we reserved their outstanding rent related receivables and recorded bad debt expense of approximately $8.1 million due to uncertainty of collectability.

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During the nine months ended September 30, 2015, the borrower relating to one mortgage receivable, for which we restructured the mortgage loan during 2014, continued to experience financial difficulties. Additionally, during the quarter and nine months ended September 30, 2015, we entered into an agreement to receive an early repayment of our other mortgage receivable at a discounted amount. We recorded both mortgage receivables at their net realizable value and recorded loan loss provisions of $3.3 million and $9.4 million during the quarter and nine months ended September 30, 2015, respectively. During the nine months ended September 30, 2015, we collected one mortgage receivable and in October 2015, we collected our last outstanding mortgage receivable.

LIQUIDITY AND CAPITAL RESOURCES

General

Our principal demand for funds will be for operating expenses, debt service and cash distributions to stockholders. Generally, our cash needs will be covered by cash generated from our investments including rental income, property operating income from managed properties, and distributions from our unconsolidated entities. To the extent we dispose of assets, we plan to use the net sales proceeds to retire indebtedness, make special distributions to our stockholders, to enhance existing assets or use for other corporate purposes.

We believe that our current liquidity needs for operating expenses, debt service and cash distributions to stockholders will be adequately covered by cash generated from our investments and other sources of available cash which may include debt proceeds or asset sales proceeds. Additionally, as previously discussed, many of our asset classes experience seasonal fluctuations where they make rental payments to us during their peak operating months. As a result, our operating cash flows will fluctuate due to the seasonality of those properties. We believe that we will be able to refinance or repay our debt as it comes due in the ordinary course of business.

Cash Flows. Our primary sources of cash include rental income from operating leases, property operating revenues, distributions from our unconsolidated entities, proceeds from sales of properties and borrowings under our revolving line of credit, offset by payments made for operating expenses, including property operating expenses, asset management fees to our Advisor, debt service payments (principal and interest), investments in unconsolidated entities, distributions and real estate investments (including acquisitions and capital expenditures). The following is a summary of our cash flows (in thousands):

	Nine Months Ended September 30,
	2015			2014
Cash at beginning of period	$	136,985		$	71,574
Cash provided by (used in):
Operating activities		80,940			132,818
Investing activities		824,922			268,902
Financing activities		(732,036	)		(196,093	)
Effect of foreign currency translation on cash		(85	)		(79	)
Cash at end of period	$	310,726		$	277,122

Sources of Liquidity and Capital Resources

Operating Activities. Net cash provided from operating activities decreased $51.9 million or 39% for the nine months ended September 30, 2015 as compared to the same period in 2014. The change in operating activities for the nine months ended September 30, 2015 as compared to same period in 2014 is primarily attributable to the sale of 41 properties subsequent to September 30, 2014.

Proceeds from Sales of Real Estate and an Unconsolidated Entity. As described above in “Our Exit Strategy”, we engaged Jefferies LLC to assist management and our Board of Directors in actively evaluating various strategic opportunities including the sale of our assets. During the nine months ended September 30, 2015, we received aggregate net sales proceeds of approximately $757.9 million from the sale of our 38 senior housing properties and one attractions property. We also received net sales proceeds of approximately $139.5 million from the sale of our 81.98% interest in the DMC Partnership, an unconsolidated entity. We used the net sales proceeds from these sales to pay down indebtedness, as further described below under “Uses of Liquidity and Capital Resources - Indebtedness”. During the nine months ended September 30, 2014, we received net sales proceeds of approximately $370.8 million from the sale of our multi-family residential property and the sale of 46 of our 48 golf properties. As described above under “Our Exit Strategy”, during 2015 and through November 5, 2015, we (i) sold our 81.98% interest in the DMC Partnership for net sales proceeds of approximately $139.5 million to our co-venture partner, (ii) sold all 38 of our senior housing properties and one attractions property for aggregate net sales proceeds of approximately $757.9 million, (iii) entered into a purchase and sale agreement for the sale of our

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marinas portfolio for approximately its carrying value, (iv) had purchase and sale agreements in place to sell three attraction properties and a ski and mountain lifestyle property, and (v) a plan to sell our undeveloped land. We intend to use a portion of existing net sales proceeds received from the sale of real estate during the nine months ended September 30, 2015 and any net sales proceeds from the proposed sale of other properties during the remainder of 2015 to make a special distribution to stockholders by the end of 2015. We may also use a portion of these net sales proceeds to make strategic capital expenditures to enhance certain of our remaining properties and/or for other corporate purposes.

Distributions from Unconsolidated Entities. We are entitled to receive quarterly cash distributions from our unconsolidated entities to the extent there is cash available to distribute. As of December 31, 2014, we owned an 81.98% interest in the DMC Partnership and an 80% interest in the Intrawest Venture. In April 2015, we sold our 81.98% interest in the DMC Partnership to our co-venture partner and received net sales proceeds of approximately $139.5 million. For the nine months ended September 30, 2015, we received distributions of approximately $11.7 million (of which $6.6 million related to the DMC Partnership) as compared to approximately $9.9 million (of which $8.5 million related to the DMC Partnership) for the same period in 2014. Distributions from our Intrawest Venture increased for the nine months ended September 30, 2015, due to the payment of interest under the intercompany loan being treated as a distribution for financial reporting purposes. Distributions from unconsolidated entities will significantly decrease going forward due to the sale of our interest in the DMC Partnership.

During the nine months ended September 30, 2015, our co-venture partner of the Intrawest Venture accepted our offer to acquire their 20% interest for a nominal amount in accordance with the buy-sell provisions of the Intrawest Venture partnership agreement. Upon acquisition of their 20% interest, we will own a 100% controlling interest in the entities that own seven properties and will include these properties in the overall assessment of strategic alternatives of our assets.

Distribution Reinvestment Plan. For the nine months ended September 30, 2014, we received aggregate proceeds of approximately $27.2 million (representing 4.0 million shares) through our distribution reinvestment plan (the “DRP”). In September 2014, our board of directors approved the suspension of our DRP, effective as of September 26, 2014. As a result of the suspension of the DRP, beginning with the September 2014 quarterly distributions, stockholders who were participants in the DRP received cash distributions instead of additional shares of our common stock. We did not receive proceeds from the DRP for the nine months ended September 30, 2015.

Proceeds from Mortgages and Other Notes Receivables. During the nine months ended September 30, 2015 and 2014, we collected principal payments of approximately $2.3 million and $83.5 million, respectively. We used the funds to pay down some of our existing indebtedness as described in “Indebtedness” below. In October 2015, we collected our only outstanding mortgage and other notes receivable.

Uses of Liquidity and Capital Resources

Investments in Unconsolidated Entities. During the nine months ended September 30, 2015, we contributed approximately $54.6 million to the Intrawest Venture and the Intrawest Venture repaid two mortgage loans of approximately $54.6 million, which matured in January 2015 and June 2015.

Indebtedness. We have borrowed and, subject to our goal of providing liquidity to our shareholders, may continue to borrow money to fund ongoing enhancements to our portfolio, pay certain related fees and to cover periodic shortfalls between distributions paid and cash flows from operating activities to avoid distribution volatility. See “Distributions” below for additional information. In many cases, we have pledged our assets in connection with such borrowings. The aggregate amount of long-term financing is not expected to exceed 50% of our total assets. As of September 30, 2015, our leverage ratio, calculated as total indebtedness over total assets, was 11.6%.

During the nine months ended September 30, 2015, we paid $10.9 million in scheduled principal payments under our mortgage loans. We also used net sales proceeds from the sales of real estate and our interest in an unconsolidated entity and repaid $135.0 million of outstanding indebtedness collateralized by the senior housing properties sold, repaid $63.8 million of outstanding indebtedness collateralized by two attractions properties and one ski and mountain lifestyle property, repaid all of our senior unsecured notes with an outstanding principal amount of $318.3 million at a premium of 103.625%, and repaid $152.5 million of our revolving line of credit. In June 2015, we extended the maturity of our revolving line of credit to August 31, 2016, with an additional year extension option, and reduced the borrowing capacity to $100 million. As of September 30, 2015, our revolving line of credit did not have an outstanding principal balance.

We have scheduled maturities of $23.2 million within the next twelve months, which we intend to repay using cash on hand or proceeds from sales of properties.

Certain of our loans require us to meet certain customary financial covenants and ratios including fixed charge coverage ratio, leverage ratio, interest coverage ratio and limitations on distributions except to maintain our REIT status. We were in compliance with all applicable provisions as of September 30, 2015.

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Acquisitions and Capital Expenditures. We did not have any acquisitions during the nine months ended September 30, 2015 but funded approximately $35.8 million in capital improvements at our properties. During the nine months ended September 30, 2014, we acquired four senior housing properties for an aggregate purchase price of approximately $128.4 million and funded approximately $55.9 million in capital improvements at our properties.

Related Party Arrangements. Through March 31, 2014, our Advisor received fees and compensation in connection with the acquisition, management and sale of our assets. In March 2014, our Advisor amended the advisory agreement, effective April 1, 2014, to eliminate acquisition fees on equity, performance fees, debt acquisition fees and disposition fees, and to reduce asset management fees to 0.075% monthly (or 0.90% annually), down from 0.083% monthly (or 1.00% annually), of average invested assets. Amounts incurred relating to these transactions were approximately $15.9 million and $25.4 million for the nine months ended September 30, 2015 and 2014, respectively. Our Advisor and its affiliates were also entitled to reimbursement of certain expenses and amounts incurred on our behalf in connection with our acquisitions and operating activities. Reimbursable expenses for the nine months ended September 30, 2015 and 2014 were approximately $4.3 million and $5.4 million, respectively. Of these amounts, approximately $0.4 million and $0.5 million are included in due to affiliates in the unaudited condensed consolidated balance sheets as of September 30, 2015 and December 31, 2014, respectively.

Pursuant to the advisory agreement, we will not reimburse our Advisor for any amount by which total operating expenses paid or incurred by us exceed the greater of 2% of average invested assets or 25% of net income (the “Expense Cap”) in any expense year. For the expense years ended September 30, 2015 and 2014, operating expenses did not exceed the Expense Cap.

Distributions. We declare and pay distributions on a quarterly basis. The amount of distributions declared to our stockholders is determined by our board of directors and is dependent upon a number of factors, including:

• Sources of cash available for distribution such as expected cash flows from operating activities, funds from operations (“FFO”), modified funds from operations (“MFFO”) and Adjusted EBITDA from Continuing Operations;

• Limitations and restrictions contained in the terms of our current and future indebtedness concerning the payment of distributions;

• Needs for capital expenditures in our portfolio; and

• Other factors such as the avoidance of distribution volatility, our objective of continuing to qualify as a REIT, capital requirements, the general economic environment and other factors.

We have and may continue to use borrowings to fund a portion of our distributions in order to avoid distribution volatility. In March 2015, our board of directors approved our 2014 estimated net asset value (the “2014 NAV”) of $5.20 per share as of December 31, 2014 and reduced distributions per share to $0.05 from $0.1063 per share on a quarterly basis. The distributions of $0.05 per share represented an annualized yield of 3.8% on our revised estimated 2014 NAV. The reduction in distributions was the result of selling our golf portfolio and other individual assets, the repayment of two mortgage notes receivable in 2014, the expected sale of our senior housing portfolio and other assets in 2015, and the associated impact of such sales on our operating cash flows. The transactions not yet completed are expected to result in additional reductions to our future cash flows from operations, earnings before interest, taxes, depreciation and amortization and our modified funds from operations (“MFFO”), which may result in additional reductions to distributions.

During the nine months ended September 30, 2015 and 2014, we paid $48.8 million and $76.2 million, respectively, in distributions, net of proceeds received under our DRP. Our cash flows from operating activities covered 100% of distributions paid for each of the nine months ended September 30, 2015 and 2014.

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The following table presents total distributions declared including cash distributions, distributions reinvested and distributions per share for the quarters and nine months ended September 30, 2015 and 2014 (in thousands, except per share data):

									Sources of Distributions Paid in Cash
	Distributions Per Share		Total Distributions Declared		Distributions Reinvested (2)		Net Cash Distributions		Cash Flow From Operating Activities (1)
2015 Quarter
First	$	0.0500	$	16,259	$	—	$	16,259	$	36,075
Second		0.0500		16,259		—		16,259		6,074
Third		0.0500		16,259		—		16,259		38,791
Total	$	0.1500	$	48,777	$	—	$	48,777	$	80,940
2014 Quarter
First	$	0.1063	$	34,278	$	13,627	$	20,651	$	37,560
Second		0.1063		34,442		13,582		20,860		39,197
Third		0.1063		34,608		—		34,608		56,061
Total	$	0.3189	$	103,328	$	27,209	$	76,119	$	132,818

FOOTNOTES:

⁽¹⁾  Cash flows from operating activities calculated in accordance with GAAP are not necessarily indicative of the amount of cash available to pay distributions. For example, GAAP requires that the payment of acquisition fees and costs be classified as a use of cash in operating activities in the statement of cash flows, which directly reduces the measure of cash flows from operations. However, acquisition fees and costs are paid for with subscription proceeds and other financing sources as opposed to operating cash flows. The Board also uses other measures such as FFO and MFFO in order to evaluate the level of distributions.

⁽²⁾  In September 2014, our Board suspended the DRP and beginning with the September 2014 quarterly distributions, stockholders who were participants in the DRP received cash distributions instead of additional shares of our common stock.

Our cash flows from operating activities will fluctuate due to the seasonality of certain properties. As such, we anticipate cash flows from operating activities to increase during the third quarter to reflect the peak seasonal period of our attractions properties.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

See our annual report on Form 10-K for the year ended December 31, 2014 for a summary of our Significant Accounting Policies.

IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS

See Item 1. “Financial Statements” for a summary of the impact of recent accounting pronouncements.

RESULTS OF OPERATIONS

As of September 30, 2015 and 2014, we had invested in 65 and 107 properties, respectively, through the following investment structures:

	September 30,
	2015		2014
Wholly-owned:
Leased properties		24		43
Managed properties (1)(2)		33		55
Unimproved land		1		1
Unconsolidated joint ventures: (3)
Leased properties		7		8
		65		107

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FOOTNOTES:

⁽¹⁾  As of September 30, 2015 and 2014, wholly-owned managed properties are as follows:

	September 30,
	2015		2014
Ski & mountain lifestyle		1		1
Golf		—		1
Attractions		15		16
Senior housing		—		20
Marinas		17		17
		33		55

⁽²⁾  Under applicable tax regulations, certain properties are permitted to be temporarily managed and certain properties are permitted to be indefinitely managed. As of September 30, 2015 and 2014, 29 and 31 properties, respectively, were temporarily managed and four and 24 properties were indefinitely managed under management agreements, respectively.

⁽³⁾  In April 2015, we sold our 81.98% interest in the DMC Partnership, which held one property. As of September 30, 2015, our co-venture partner of the Intrawest Venture had accepted our offer to buy out their 20% non-controlling interest. See “Distributions from Unconsolidated Entities” for additional information.

The following discussion and analysis should be read in conjunction with the accompanying condensed consolidated financial statements and the notes thereto.

During the quarter and nine months ended September 30, 2015 and 2014, the results of 41 and 42 real estate investment properties, respectively, contributed to income from continuing operations. As of September 30, 2015, the results of operations for 17 properties held for sale as of September 30, 2015 along with the results of operations of 38 senior housing properties sold during 2015 and 49 properties sold during 2014 are included in income from discontinued operations in the accompanying statements of operations for all periods presented.

Rental income from operating leases. Rental income for the quarter and nine months ended September 30, 2015 decreased by approximately $2.1 million and $5.0 million, respectively, as compared to the same period in 2014. Additional billings permitted under our leases calculated as a percent of ski property level operating revenues generated by our tenants declined by approximately $1.9 million and $5.2 million during the quarter and nine months ended September 30, 2015, respectively, due to lower levels of snow particularly in the Pacific West. Additionally, rental income from operating leases declined an additional $1.3 million and $1.6 million during the same periods, respectively, due to one of our ski tenants with two leases on properties in the Pacific-West experiencing financial difficulties and defaulting on their rent. This decline was partially offset by an increase in revenues attributed to capital improvements made at our attractions properties that resulted in higher lease basis, which increased rent due from our tenants. The following information summarizes trends in rental income from operating leases and base rents for certain of our properties excluding properties that have been classified as discontinued operations (in thousands):

	Quarter Ended September 30,
Properties Subject to Operating Leases	2015		2014		$ Change			% Change
Ski and mountain lifestyle	$	19,695	$	22,876	$	(3,181	)		(13.9	)%
Attractions		9,879		8,844		1,035			11.7	%
Total	$	29,574	$	31,720	$	(2,146	)		(6.8	)%
	Nine Months Ended September 30,
Properties Subject to Operating Leases	2015		2014		$ Change			% Change
Ski and mountain lifestyle	$	68,315	$	75,114	$	(6,799	)		(9.1	)%
Attractions		24,310		22,520		1,790			7.9	%
Total	$	92,625	$	97,634	$	(5,009	)		(5.1	)%

As of September 30, 2015 and 2014, the weighted-average lease rate for our portfolio of wholly-owned leased properties (excluding assets held for sale) was 10.2% and 10.3%, respectively. These rates are based on annualized straight-line base rent due under our leases and the weighted-average contractual lease basis of our real estate investment properties subject to operating leases. The weighted-average lease rate of our portfolio may fluctuate based on our asset mix, timing of property acquisitions, lease terminations and reductions in rent granted to tenants.

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Property operating revenues. Property operating revenues from managed properties, which are not subject to leasing arrangements, are derived from room rentals, food and beverage sales, ski and spa operations, ticket sales, concessions, waterpark and theme park operations, and other service revenues. The following information summarizes the revenues of our properties that are operated by third-party managers (in thousands):

	Quarter Ended September 30,
Properties Operated by Third-Party Managers	2015		2014		$ Change			% Change
Ski and mountain lifestyle	$	16,571	$	15,495	$	1,076			6.9	%
Attractions		81,330		95,371		(14,041	)		(14.7	)%
Total	$	97,901	$	110,866	$	(12,965	)		(11.7	)%
	Nine Months Ended September 30,
Properties Operated by Third-Party Managers	2015		2014		$ Change			% Change
Ski and mountain lifestyle	$	44,548	$	41,449	$	3,099			7.5	%
Attractions		146,597		164,461		(17,864	)		(10.9	)%
Total	$	191,145	$	205,910	$	(14,765	)		(7.2	)%

As of September 30, 2015 and 2014, we had a total of 16 and 17 managed properties (excluding properties that we classified as discontinued operations), respectively, of which certain properties are operated seasonally due to geographic location, climate and weather patterns. The decrease in property operating revenues is primarily due to the sale of one of our attraction properties in June 2015. This decrease was partially offset by increases in property operating revenue for our other attractions properties primarily due to higher ticket sales, retail shop sales and food and beverage sales. This decrease was also partially offset by our Mount Washington Resort which experienced higher room, ski and food and beverage revenues as a result of renovations and enhancements we have made at the property and operational strategies that have been implemented, as well as strong group and conference business.

Interest income on mortgages and other notes receivable. For the quarter and nine months ended September 30, 2015, we earned interest income of approximately $0.1 million and $1.5 million, respectively, as compared to approximately $2.0 million and $8.0 million for the same periods in 2014, respectively. The decrease is primarily due to $83.5 million in principal received during the nine months ended September 30, 2014.

Property operating expenses. Property operating expenses decreased primarily due to the sale of one of our attractions properties in June 2015, offset by increases at our other attractions properties consistent with the increase in property operating revenues. The following information summarizes the expenses of our properties that are operated by third-party managers (in thousands):

	Quarter Ended September 30,
Properties Operated by Third-Party Managers	2015		2014		$ Change			% Change
Ski and mountain lifestyle	$	12,357	$	11,565	$	792			6.8	%
Attractions		43,899		50,885		(6,986	)		(13.7	)%
Total	$	56,256	$	62,450	$	(6,194	)		(9.9	)%
	Nine Months Ended September 30,
Properties Operated by Third-Party Managers	2015		2014		$ Change			% Change
Ski and mountain lifestyle	$	34,730	$	34,477	$	253			0.7	%
Attractions		110,585		119,132		(8,547	)		(7.2	)%
Total	$	145,315	$	153,609	$	(8,294	)		(5.4	)%

Asset management fees to advisor. Monthly asset management fees equal to 0.08334% prior to April 1, 2014 and 0.075% effective April 1, 2014 of invested assets were paid to the Advisor for the management of our real estate assets, loans and other permitted investments. For the quarter and nine months ended September 30, 2015, asset management fees to our Advisor were approximately $3.7 million and $12.2 million, respectively, as compared to approximately $4.4 million and $14.2 million, respectively, for the quarter and nine months ended September 30, 2014. The decrease in such fees is primarily attributable to the reduction in asset fee rates described above and the sale of one attraction property and our interest in the DMC Partnership subsequent to September 30, 2014.

27

General and administrative. General and administrative expenses totaled approximately $3.0 million and $11.5 million for the quarter and nine months ended September 30, 2015, as compared to approximately $4.3 million and $13.2 million, respectively, for the quarter and nine months ended September 30, 2014. General and administrative expenses were comprised primarily of reimbursable personnel expenses of affiliates of our Advisor, accounting and legal fees, and board of directors’ fees. The decrease in general and administrative expenses for the quarter and nine months ended September 30, 2015, is primarily the result of a reduction in legal, accounting and other professional services necessary to account and report on our smaller portfolio of assets.

Ground leases and permit fees. Ground lease payments and land permit fees are generally based on a percentage of gross revenue of the underlying property over certain thresholds. For properties that are subject to leasing arrangements, ground leases and permit fees are paid by the tenants in accordance with the terms of our leases with those tenants and we record the corresponding equivalent revenues in rental income from operating leases. For the quarter and nine months ended September 30, 2015, ground lease and land permit fees were approximately $2.4 million and $7.8 million, respectively, as compared to approximately $2.2 million and $7.8 million, respectively, for the quarter and nine months ended September 30, 2014.

Other operating expenses. Other operating expenses were approximately $1.7 million and $4.9 million for the quarter and nine months ended September 30, 2015, respectively, as compared to approximately $1.9 million and $3.9 million for the quarter and nine months ended September 30, 2014, respectively.

Bad debt expense. Bad debt expense totaled approximately $3.3 million and $8.1 million for the quarter and nine months ended September 30, 2015, respectively. The increase is related to one of our ski tenants with two leases on properties in the Pacific-West experiencing financial difficulties as a result of lower operating results from the low levels of snow accompanied by unusually warm weather.

Loan loss provision. Loan loss provision was approximately $21 thousand and $9.4 million for the quarter and nine months ended September 30, 2015, respectively. As described above in “Bad Debt Expense, Loan Provisions and Impairments”, we recorded these loan loss provisions to record our mortgage receivables at their net realizable values at September 30, 2015. Loan loss provision was approximately $0.7 million and $3.3 million for the quarter and nine months ended September 30, 2014, respectively, as a result of uncertainty in the collectability of one of our notes receivable.

Impairment provision. Impairment provision was approximately $1.4 million for the quarter and nine months ended September 30, 2015, respectively. The impairment related to an adjustment to the net carrying value of our undeveloped land due to a revised estimated sale price, less closing costs. There were no impairment provisions during 2014.

Depreciation and amortization. Depreciation and amortization expenses were approximately $19.8 million and $63.5 million for the quarter and nine months ended September 30, 2015, respectively, as compared to approximately $25.4 million and $73.2 million for the quarter and nine months ended September 30, 2014, respectively.

Interest and other income. Interest and other income was approximately $0.3 million and $1.1 million for the quarter and nine months ended September 30, 2015, respectively, as compared to approximately $0.2 million and $0.4 million for the quarter and nine months ended September 30, 2014, respectively.

Interest expense and loan cost amortization. Interest expense and loan cost amortization was approximately $3.2 million and $23.9 million for the quarter and nine months ended September 30, 2015, respectively, as compared to approximately $15.0 million and $44.4 million, for the quarter and nine months ended September 30, 2014, respectively. The decrease is primarily attributable to the pay down of approximately $703.0 million of indebtedness, excluding indebtedness related to properties classified as discontinued operations, subsequent to September 30, 2014.

Loss on extinguishment of debt. Losses on extinguishment of debt were approximately $21.1 million for the nine months ended September 30, 2015, as compared to $1.6 million and $1.8 million for the quarter and nine months ended September 30, 2014, respectively. The losses incurred during the nine months ended September 30, 2015, related to the early repayments of our senior unsecured notes and certain loans during 2015. Loss on extinguishment of debt included legal fees incurred with the transaction, prepayment penalty fees and the write-off of unamortized bond issue costs and loan costs. The losses incurred during the nine months ended September 30, 2014, related to an early repayment on two of our loans and repurchasing at a premium, the face value of $24.5 million of our senior notes.

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Equity in earnings (loss) of unconsolidated entities. The following table summarizes equity in earnings (loss) from our unconsolidated entities (in thousands):

	Quarter Ended September 30,
	2015		2014			$ Change			% Change
DMC Partnership	$	—	$	2,797		$	(2,797	)		(100.0	)%
Intrawest Venture		1,162		379			783			206.6	%
Total	$	1,162	$	3,176		$	(2,014	)		(63.4	)%
	Nine Months Ended September 30,
	2015		2014			$ Change			% Change
DMC Partnership	$	2,475	$	8,206		$	(5,731	)		(69.8	)%
Intrawest Venture		1,465		(1,257	)		2,722			216.5	%
Total	$	3,940	$	6,949		$	(3,009	)		(43.3	)%

Equity in earnings of unconsolidated entities decreased by approximately $2.0 million and $3.0 million for the quarter and nine months ended September 30, 2015, respectively, as compared to the same periods of 2014. The change was primarily due to the sale of our interest in the DMC Partnership in April 2015. This decrease was offset by improved results from our Intrawest Venture in 2015 due to the fact that during the quarter and nine months ended September 30, 2014, we recorded catch up depreciation and amortization expense due to the reclassification of seven Intrawest village retail properties from assets held for sale to held and used. Equity in earnings will decrease significantly going forward due to the sale of our 81.98% interest in the DMC Partnership in April 2015.

In July 2015, our co-venture partner accepted our offer to acquire their 20% interest in the Intrawest Venture for a nominal amount in accordance with the buy-sell provisions of the Intrawest Venture partnership agreement. Upon acquisition of their 20% interest, we will own a 100% controlling interest in the entities that own seven properties and will include these properties in the overall assessment of strategic alternatives of our assets.

Discontinued operations. Income from discontinued operations was approximately $7.6 million and $214.4 million for the quarter and nine months ended September 30, 2015, as compared to income (loss) of approximately $0.5 million and $(1.4) million for the quarter and nine months ended September 30, 2014. The results of operations of 104 properties (which included our marinas properties classified as held for sale as of September 30, 2015, the 38 senior housing properties sold during 2015 and all properties sold during 2014), are reflected in discontinued operations for all periods presented. Income from discontinued operations for the quarter and nine months ended September 30, 2015, includes $4.2 million and $210.8 million, respectively, of gains from the sale of one and 38 senior housing properties, respectively. Income due to the gains on the sale of real estate was partially offset by a decline in net operating income from the sale of 41 properties subsequent to September 30, 2014, and the recording of impairment provisions related to the marinas properties during the second quarter of 2015. See Note 4. “Assets and Associated Liabilities Held for Sale, net and Discontinued Operations” for additional information.

Gain (loss) on sale of real estate. Gain (loss) on sale of real estate from continuing operations was approximately $(1.1) million and $26.5 million for the quarter and nine months ended September 30, 2015. The gain on sale of real estate primarily related to the sale of one of our attractions properties. There was no gain on sale of real estate in 2014 as the gains were recorded through discontinued operations.

Gain from sale of unconsolidated entity. Gain from sale of our interest in the DMC Partnership, our unconsolidated entity, was approximately $39.3 million for the nine months ended September 30, 2015. There was no gain on sale of unconsolidated entity during 2014.

Other

Funds from Operations and Modified Funds From Operations

Due to certain unique operating characteristics of real estate companies, as discussed below, NAREIT, promulgated a measure known as FFO, which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. The use of FFO is recommended by the REIT industry as a supplemental performance measure. FFO is not equivalent to net income or loss as determined under GAAP.

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We define FFO, a non-GAAP measure, consistent with the standards approved by the Board of Governors of NAREIT. NAREIT defines FFO as net income or loss computed in accordance with GAAP, excluding gains or losses from sales of property, real estate impairment write-downs, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Our FFO calculation complies with NAREIT’s policy described above.

The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time, especially if such assets are not adequately maintained or repaired and renovated as required by relevant circumstances and/or is requested or required by lessees for operational purposes in order to maintain the value of the property. We believe that, because real estate values historically rise and fall with market conditions, including inflation, interest rates, the business cycle, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation may be less informative. Historical accounting for real estate involves the use of GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and amortization, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income or loss. However, FFO and MFFO, as described below, should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income or loss in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP FFO and MFFO measures and the adjustments to GAAP in calculating FFO and MFFO.

Changes in the accounting and reporting promulgations under GAAP (for acquisition fees and expenses for business combinations from a capitalization/depreciation model to an expensed-as-incurred model) that were put into effect in 2009 and other changes to GAAP accounting for real estate subsequent to the establishment of NAREIT’s definition of FFO have prompted an increase in cash-settled expenses, specifically acquisition fees and expenses as items that are expensed under GAAP and accounted for as operating expenses. Our management believes these fees and expenses do not affect our overall long-term operating performance. Publicly registered, non-listed REITs typically have a significant amount of acquisition activity and are substantially more dynamic during their initial years of investment and operation. While other start up entities may also experience significant acquisition activity during their initial years, we believe that non-listed REITs are unique in that they have a limited life with targeted exit strategies within a relatively limited time frame after the acquisition activity ceases. Due to the above factors and other unique features of publicly registered, non-listed REITs, the IPA, an industry trade group, has standardized a measure known as MFFO, which the IPA has recommended as a supplemental measure for publicly registered non-listed REITs and which we believe to be another appropriate supplemental measure to reflect the operating performance of a non-listed REIT. MFFO is not equivalent to our net income or loss as determined under GAAP, and MFFO may not be a useful measure of the impact of long-term operating performance on value if we do not continue to operate with a limited life and targeted exit strategy, as currently intended. We believe that, because MFFO excludes costs that we consider more reflective of investing activities and other non-operating items included in FFO and also excludes acquisition fees and expenses that affect our operations only in periods in which properties are acquired, MFFO can provide, on a going forward basis, an indication of the sustainability (that is, the capacity to continue to be maintained) of our operating performance after the period in which we acquired our properties and once our portfolio is in place. By providing MFFO, we believe it is presenting useful information that assists investors and analysts to better assess the sustainability of our operating performance after our properties have been acquired. We also believe that MFFO is a recognized measure of sustainable operating performance by the non-listed REIT industry.

We define MFFO, a non-GAAP measure, consistent with the IPA’s Guideline 2010-01, Supplemental Performance Measure for Publicly Registered, Non-Listed REITs: Modified Funds from Operations, or the Practice Guideline, issued by the IPA in November 2010. The Practice Guideline defines MFFO as FFO further adjusted for the following items, as applicable, included in the determination of GAAP net income or loss: acquisition fees and expenses; amounts relating to straight-line rent adjustments for leases and notes receivable; gains or losses included in net income from the extinguishment or sale of debt and hedges; amounts relating to the amortization of above and below market leases and liabilities (which are adjusted in order to remove the impact of GAAP straight-line adjustments from rental revenues); loan loss provisions related to mortgages and other notes receivable; accretion of discounts and amortization of premiums on debt investments; eliminations of adjustments relating to contingent purchase price obligations where such adjustments have been included in the derivation of GAAP net income or loss, mark-to-market adjustments included in net income or loss; and adjustments for consolidated and unconsolidated partnerships and joint ventures, with such adjustments calculated to reflect MFFO on the same basis. The accretion of discounts and amortization of premiums on debt investments, unrealized gains and losses on hedges, foreign exchange, derivatives or securities holdings, unrealized gains and losses resulting from consolidations, as well as other listed cash flow adjustments are adjustments made to net income in calculating the cash flows provided by operating activities and, in some cases, reflect gains or losses which are unrealized and may not ultimately be realized. While we are responsible for managing interest rate, hedge and foreign exchange risk, we do retain an outside consultant to review all of our hedging agreements. Inasmuch as interest rate hedges are not a fundamental part of our operations, we believe it is appropriate to exclude such gains and losses in calculating MFFO, as such gains and losses are not reflective of on-going operations.

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Our MFFO calculation complies with the IPA’s Practice Guideline described above. In calculating MFFO, we exclude acquisition related expenses, straight-line adjustments for leases and notes receivable, amortization of above and below market leases, impairments of lease related assets, loss from early extinguishment of debt and accretion of discounts or amortization of premiums for debt investments. Under GAAP, acquisition fees and expenses are characterized as operating expenses in determining operating net income or loss. These expenses are paid in cash by us. All paid and accrued acquisition fees and expenses will have negative effects on returns to investors, the potential for future distributions, and cash flows generated by us, unless earnings from operations or net sales proceeds from the disposition of other properties are generated to cover the purchase price of the property. Further, under GAAP, certain contemplated non-cash fair value and other non-cash adjustments are considered operating non-cash adjustments to net income or loss in determining cash flow from operating activities.

Our management uses MFFO and the adjustments used to calculate it in order to evaluate our performance against other non-listed REITs which have limited lives with short and defined acquisition periods and targeted exit strategies shortly thereafter. As noted above, MFFO may not be a useful measure of the impact of long-term operating performance on value if we do not continue to operate in this manner. We believe that our use of MFFO and the adjustments used to calculate it allow us to present our performance in a manner that reflects certain characteristics that are unique to non-listed REITs, such as their limited life, limited and defined acquisition period and targeted exit strategy, and hence that the use of such measures is useful to investors. For example, acquisitions costs are funded from our subscription proceeds and other financing sources and not from operations. By excluding expensed acquisition costs, the use of MFFO provides information consistent with management’s analysis of the operating performance of the properties. Additionally, fair value adjustments, which are based on the impact of current market fluctuations and underlying assessments of general market conditions but can also result from operational factors such as rental and occupancy rates, may not be directly related or attributable to our operating performance. By excluding such changes that may reflect anticipated and unrealized gains or losses, we believe MFFO provides useful supplemental information.

Presentation of this information is intended to provide useful information to investors as they compare the operating performance of different non-listed REITs, although it should be noted that not all REITs calculate FFO and MFFO the same way and as such comparisons with other REITs may not be meaningful. Furthermore, FFO and MFFO are not necessarily indicative of cash flows available to fund cash needs and should not be considered as an alternative to net income (loss) or income (loss) from continuing operations as an indication of our performance, as an alternative to cash flows from operations as an indication of its liquidity, or indicative of funds available to fund cash needs including our ability to make distributions to stockholders. FFO and MFFO should be reviewed in conjunction with other GAAP measurements as an indication of our performance. MFFO has limitations as a performance measure in an offering such as ours where the price of a share of common stock is a stated value or based on an estimated net asset value. MFFO is useful in assisting management and investors in assessing the sustainability of operating performance in future operating periods, and in particular, after the offering and acquisition stages are complete and net asset value is disclosed. FFO and MFFO are not useful measures in evaluating net asset value because impairments are taken into account in determining net asset value but not in determining FFO and MFFO.

Neither the SEC, NAREIT nor any other regulatory body has passed judgment on the acceptability of the adjustments we use to calculate FFO or MFFO. In the future, the SEC, NAREIT or another regulatory body may decide to standardize the allowable adjustments across the non-listed REIT industry and we would have to adjust its calculation and characterization of FFO or MFFO.

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The following table presents a reconciliation of net income or loss to FFO and MFFO for the quarter and nine months ended September 30, 2015 and 2014 (in thousands, except per share data):

	Quarter Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Net income	$	40,845		$	30,623		$	261,391		$	1,765
Adjustments:
Depreciation and amortization
Continuing operations		19,807			25,389			63,463			73,179
Discontinued operations		—			8,233			—			28,403
Impairment of real estate assets (1)
Continuing operations		1,428			—			1,428			—
Discontinued operations		—			—			7,749			3,442
(Gain) loss on sale of real estate investment (2)
Continuing operations		1,064			—			(26,528	)		—
Discontinued operations		(5,290	)		(3,953	)		(212,383	)		(3,883	)
Gain on sale of unconsolidated entity (3)
Continuing operations		—			—			(39,252	)		—
Net effect of FFO adjustment from unconsolidated entities (4)		824			3,819			4,721			12,208
Total funds from operations		58,678			64,111			60,589			115,114
Acquisition fees and expenses (5)
Continuing operations		—			(237	)		—			519
Discontinued operations		—			746			—			1,994
Straight-line adjustments for leases and notes receivable (6)
Continuing operations		6,277			5,436			1,958			1,072
Discontinued operations		—			(819	)		—			(2,619	)
Loss (gain) on early extinguishment of debt (7)
Continuing operations		—			1,620			21,065			1,816
Discontinued operations		(486	)		8,293			2,042			5,690
Contingent purchase price consideration adjustment (8)
Continuing operations		—			(665	)		—			(665	)
Amortization of above/below market intangible assets and liabilities
Continuing operations		(19	)		(12	)		(57	)		12
Discontinued operations		—			101			—			460
Loan loss provision (9)
Continuing operations		21			750			9,369			3,270
Realized loss on the extinguishment of cash flow hedge (7)
Continuing operations		—			62			180			466
Discontinued operations		—			—			—			2,337
Accretion of discounts/amortization of premiums on debt investments
Continuing operations		—			44			1			50
MFFO adjustments from unconsolidated entities: (4)
Straight-line adjustments for leases and notes receivable (6)
Continuing operations		68			113			338			175
Amortization of above/below market intangible assets and liabilities
Continuing operations		(8	)		(41	)		(4	)		(116	)
Modified funds from operations	$	64,531		$	79,502		$	95,481		$	129,575
Weighted average number of shares of common stock outstanding (basic and diluted)		325,183			325,707			325,183			324,194
FFO per share (basic and diluted)	$	0.18		$	0.20		$	0.19		$	0.36
MFFO per share (basic and diluted)	$	0.20		$	0.24		$	0.29		$	0.40

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FOOTNOTES:

⁽¹⁾  While impairment charges are excluded from the calculation of FFO, investors are cautioned that due to the fact that impairments are based on estimated future undiscounted cash flows and the relatively limited term of our operations, it could be difficult to recover any impairment charges.

⁽²⁾  Gains and loss on the sale of real estate for the quarter and nine months ended September 30, 2015, primarily includes the gains and losses recognized on the sale of our 38 senior housing properties and one attractions property.

⁽³⁾  In April 2015, we completed the sale of our interest in one unconsolidated joint venture that held one property. See “Distributions from Unconsolidated Entities” for additional information.

⁽⁴⁾  This amount represents our share of the FFO or MFFO adjustments allowable under the NAREIT or IPA definitions, respectively, multiplied by the percentage of income or loss recognized under the HLBV method.

⁽⁵⁾  In evaluating investments in real estate, management differentiates the costs to acquire the investment from the operations derived from the investment. By adding back acquisition fees and expense relating to business combinations, management believes MFFO provides useful supplemental information of its operating performance and will also allow comparability between real estate entities regardless of their level of acquisition activities. Acquisition fees and expenses include payments to our advisor or third parties. Acquisition fees and expenses relating to business combinations under GAAP are considered operating expenses and as expenses included in the determination of net income (loss) and income (loss) from continuing operations, both of which are performance measures under GAAP. All paid and accrued acquisition fees and expenses will have negative effects on returns to investors, the potential for future distributions, and cash flows generated by us, unless earnings from operations or net sales proceeds from the disposition of properties are generated to cover the purchase price of the property.

⁽⁶⁾  Under GAAP, rental receipts are allocated to periods using various methodologies. This may result in income recognition that is significantly different than underlying contract terms. By adjusting for these items (to reflect such payments from a GAAP accrual basis to a cash basis of disclosing the rent and lease payments), MFFO provides useful supplemental information on the realized economic impact of lease terms and debt investments, providing insight on the contractual cash flows of such lease terms and debt investments, and aligns results with management’s analysis of operating performance.

⁽⁷⁾  (Gain) loss of extinguishment of debt includes legal fees incurred with the transaction, prepayment penalty fees and write-off of unamortized loan costs, as applicable. Loss from extinguishment of cash flow hedge includes swap breakage fees and reclassification of loss on termination of cash flow hedges from other comprehensive income (loss) from interest expense.

⁽⁸⁾  Management believes that the elimination of the contingent purchase price consideration adjustment, which respects the Yield Guarantee as mentioned above, included in interest and other income (expense) for GAAP purposes is appropriate because the adjustment is a noncash adjustment that is not reflective of our ongoing, operating performance and aligns with management’s analysis of operating performance.

⁽⁹⁾  During the nine months ended September 30, 2014, we recorded a loan loss provision on one of our mortgages and other notes receivable as a result of uncertainty related to the collectability of the note receivable. During the nine months ended September 30, 2015, we recorded loan loss provisions on our mortgage notes receivables to adjust the carrying values to net realizable values.

Total FFO and FFO per share was approximately $58.7 million and $60.6 million or $0.18 and $0.19 for the quarter and nine months ended September 30, 2015, respectively, as compared to approximately $64.1 million and $115.1 million or $0.20 and $0.36 for the same periods in 2014. The decrease in FFO and FFO per share is primarily attributable to (i) loss on early extinguishment of debt, (ii) the loan loss provisions recorded on our mortgage notes receivables to adjust the carrying values to net realizable values, (iii) bad debt expense recorded related to two ski properties, (iv) a decrease in rental income and net operating income from leased and managed properties due to the sale of our golf portfolio, our multi-family residential property, our 38 senior housing properties and one of our attractions properties, (v) a decrease in the net effect of FFO adjustment from unconsolidated entities primarily as a result of the sale of our interest in the DMC Partnership, and (vi) a decrease in interest income on mortgage notes receivable due to the collection of $83.5 million of principal during the nine months ended September 30, 2014. The decreases were partially offset by (i) a decrease in interest expense primarily due to a decrease in weighted average debt outstanding, (ii) an increase in “same-store” net operating income from managed properties primarily related to our attractions properties, and (iii) a decrease in asset management fees.

33

Total MFFO and MFFO per share was approximately $64.5 million and $95.5 million or $0.20 and $0.29 for the quarter and nine months ended September 30, 2015, respectively, as compared to approximately $79.5 million and $129.6 million or $0.24 and $0.40 for the same periods in 2014. The decrease in MFFO and MFFO per share is primarily attributable to (i) bad debt expense recorded related to two ski properties, (ii) a decrease in rental income and net operating income from leased and managed properties due to the sale of our golf portfolio, our multi-family residential property, our 38 senior housing properties and one of our attractions properties, (iii) a decrease in the net effect of FFO adjustment from unconsolidated entities primarily as a result of the sale of our interest in the DMC Partnership, and (iii) a decrease in interest income on mortgage notes receivable due to the collection of principal subsequent to September 30, 2014. The decreases were partially offset by (i) a decrease in interest expense primarily due to a decrease in weighted average debt outstanding, (ii) an increase in “same-store” net operating income from managed properties primarily related to our attractions properties, and (iii) a decrease in asset management fees.

Adjusted EBITDA from Continuing Operations

We present Adjusted EBITDA from Continuing Operations as a supplemental measure of our performance. We define Adjusted EBITDA from Continuing Operations as net income (loss), less discontinued operations and other income, plus (i) interest expense, net, and loan cost amortization and (ii) depreciation and amortization, as further adjusted for the impact of equity in earnings (loss) of our unconsolidated entities, straight-line adjustments for leased properties and mortgages and other notes receivables, cash distributions from our unconsolidated entities and certain other items that we do not consider indicative of our ongoing operating performance. These further adjustments are itemized below. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA from Continuing Operations, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Adjusted EBITDA from Continuing Operations should not be construed as an inference that our future results will be unaffected by unusual items.

We present Adjusted EBITDA from Continuing Operations because we believe it assists investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.

Adjusted EBITDA from Continuing Operations has limitations as an analytical tool. Some of these limitations are:

• Adjusted EBITDA from Continuing Operations does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;

• Adjusted EBITDA from Continuing Operations does not reflect changes in, or cash requirements for, our working capital needs;

• Adjusted EBITDA from Continuing Operations does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness;

• Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and Adjusted EBITDA from Continuing Operations does not reflect any cash requirements for such replacements;

• Adjusted EBITDA from Continuing Operations does not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and

• Other companies in our industry may calculate Adjusted EBITDA from Continuing Operations differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA from Continuing Operations should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using Adjusted EBITDA from Continuing Operations only supplementally.

34

Set forth below is a reconciliation of Adjusted EBITDA from Continuing Operations to net income (loss) (in thousands):

	Quarter Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Net income	$	40,845		$	30,623		$	261,391		$	1,765
(Income) loss from discontinued operations		(7,614	)		(537	)		(214,386	)		1,368
(Gain) loss on sale of real estate		1,064			—			(26,528	)		—
Gain on sale of unconsolidated entity		—			—			(39,252	)		—
Interest and other income		(309	)		(153	)		(1,066	)		(449	)
Interest expense and loan cost amortization		3,202			15,012			23,946			44,380
Equity in earnings of unconsolidated entities (1)		(1,162	)		(3,176	)		(3,940	)		(6,949	)
Depreciation and amortization		19,807			25,389			63,463			73,179
Loss from extinguishment of debt		—			1,620			21,065			1,816
Loan loss provision		21			750			9,369			3,270
Impairment provision		1,428			—			1,428			—
Straight-line adjustments for leases and notes receivables (2)		6,277			5,436			1,958			1,072
Cash distributions from unconsolidated entities (1)		918			3,321			11,651			9,896
Adjusted EBITDA from Continuing Operations	$	64,477		$	78,285		$	109,099		$	129,348

FOOTNOTES:

⁽¹⁾  Investments in our unconsolidated joint ventures are accounted for under the HLBV method of accounting. Under this method, we recognize income or loss based on the change in liquidating proceeds we would receive from a hypothetical liquidation of our investments based on depreciated book value. We adjust EBITDA from continuing operations for equity in earnings (loss) of our unconsolidated entities because we believe this is not reflective of the joint ventures’ operating performance or cash flows available for distributions to us. We believe cash distributions from our unconsolidated entities, exclusive of any financing transactions, are reflective of their operating performance and its impact to us and have been added back to adjusted EBITDA from continuing operations above.

⁽²⁾  We believe that adjusting for straight-line adjustments for leased properties and mortgages and other notes receivable is appropriate because they are non-cash adjustments and reflect the actual cash receipts received by us from our tenants and borrowers.

Adjusted EBITDA from Continuing Operations was approximately $64.5 million and $109.1 million for the quarter and nine months ended September 30, 2015, respectively, as compared to approximately $78.3 million and $129.3 million for the same periods in 2014, respectively. The decrease was primarily attributable to (i) bad debt expense recorded related to two ski properties, (ii) a decrease in interest income on mortgage notes receivable due to the collection of $83.5 million of principal during the nine months ended September 30, 2014, and (iii) the sale of one of our attractions properties in June 2015. The decreases were partially offset by (i) an increase in “same-store” net operating income from managed properties primarily related to our attractions properties and (ii) a reduction in asset management fees.

Off-Balance Sheet and Other Arrangements

During the nine months ended September 30, 2015, we made contributions of approximately $54.6 million to the Intrawest Venture and Intrawest Venture repaid approximately $54.6 million in mortgage loans that matured in January and June 2015. In April 2015, we sold our 81.98% interest in the DMC Partnership to our co-venture partner, which included $131.5 million of indebtedness related to the partnership. As of September 30, 2015, the Intrawest Venture had one intercompany loan payable to its joint venture partners of approximately $11.1 million which matures in December 2029.

In July 2015, our co-venture partner accepted our offer to acquire their 20% interest in the Intrawest Venture for a nominal amount in accordance with the buy-sell provisions of the Intrawest Venture partnership agreement. Upon acquisition of their 20% interest, we will own a 100% controlling interest in the entities that own seven properties.

35

Commitments, Contingencies and Contractual Obligations

The following tables present our contractual obligations and contingent commitments and the related payments due by period as of September 30, 2015:

Contractual Obligations

	Payments Due by Period (in thousands)
	2015		2016-2017		2018-2019		Thereafter		Total
Mortgages and other notes payable (principal and interest) (1)	$	21,954	$	170,807	$	8,076	$	1,705	$	202,542
Capital lease		818		3,434		978		—		5,230
Obligations under operating leases (2)		3,142		25,140		25,140		168,948		222,370
Total		25,914		199,381		34,194		170,653		430,142

FOOTNOTES:

(1) This line item includes all third-party and seller financing obtained in connection with the acquisition of properties. Future interest payments on our variable rate debt and line of credit were estimated based on a 30-day LIBOR forward rate curve.

(2) This line item represents obligations under ground leases, concession holds and land permits of which the majority are paid by our third-party tenants on our behalf. Ground lease payments, concession holds and land permit fees are generally based on a percentage of gross revenue of the related property exceeding a certain threshold. The future obligations have been estimated based on current revenue levels projected over the term of the leases or permits.

Contingent Commitments

	Payments Due by Period (in thousands)
	2015		2016-2017		2018-2019		Thereafter		Total
Capital improvements (1)	$	4,531	$	—	$	—	$	—	$	4,531

FOOTNOTE:

⁽¹⁾  We have committed to fund ongoing equipment replacements and other capital improvement projects on our existing properties through capital reserves set aside by us for this purpose and additional capital investment in the properties that will increase the lease basis and generate additional rental income.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to interest rate changes primarily as a result of long-term debt used to acquire properties, make loans and other permitted investments. Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings and cash flows and to lower our overall borrowing costs. To achieve our objectives, we expect to borrow and lend primarily at fixed-rates or variable-rates with the lowest margins available, and in some cases, with the ability to convert variable-rates to fixed-rates. With regard to variable-rate financing, we will assess interest rate cash flow risk by continually identifying and monitoring changes in interest rate exposures that may adversely impact expected future cash flows and by evaluating hedging opportunities.

Our fixed-rate mortgage and other notes receivable totaled $7.6 million and $19.4 million at September 30, 2015 and December 31, 2014, respectively. The estimated fair value of the mortgage notes receivable was approximately $7.6 million and $16.6 million, respectively, and is subject to market risk to the extent that the stated interest rates vary from current market rates for borrowings under similar terms.

36

The following is a schedule of our fixed and variable debt maturities for each of the next five years, and thereafter (in thousands):

	2015		2016		2017		2018		2019		Thereafter		Total		Fair Value
Fixed-rate debt	$	862	$	34,678	$	85,369	$	—	$	—	$	1,705	$	122,614	$	126,672
Variable-rate debt (2)		19,213		1,618		37,029		437		6,799		—		65,096		67,485
	$	20,075	$	36,296	$	122,398	$	437	$	6,799	$	1,705	$	187,710	$	194,157

	2015	2016	2017	2018	2019	Thereafter	Total
Weighted average fixed interest rate of maturities	6.23%	6.57%	6.10%	—	—	—	6.14%
Average interest rate on variable debt(3)	LIBOR + 3.01%	LIBOR+ 3.45%	LIBOR + 3.50%	LIBOR + 3.30%	LIBOR + 3.30%

FOOTNOTES:

⁽¹⁾  The fair value of our fixed-rate debt was determined using discounted cash flows based on market interest rates as of September 30, 2015. We determined market rates through discussions with our existing lenders pricing our loans with similar terms and current rates and spreads.

⁽²⁾  As of September 30, 2015, one of our variable-rate debt in mortgages and notes payable was hedged.

⁽³⁾  The 30-day LIBOR rate was approximately 0.19% at September 30, 2015.

Management estimates that a hypothetical one-percentage point increase in LIBOR would have resulted in additional interest costs of approximately $0.4 million for the nine months ended September 30, 2015 related to variable rate debt outstanding as of September 30, 2014. This sensitivity analysis contains certain simplifying assumptions, and although it gives an indication of our exposure to changes in interest rates, it is not intended to predict future results and our actual results will likely vary.

We are exposed to foreign currency exchange rate fluctuations as a result of our direct ownership of one property in Canada which is leased to a third-party tenant. The lease payments we receive under the triple-net lease are denominated in Canadian dollars. Management does not believe this to be a significant risk or that currency fluctuations would result in a significant impact to our overall results of operations.

We are also indirectly exposed to foreign currency risk related to our investment in unconsolidated Canadian entities and interest rate risk from debt at our unconsolidated entities. However, we believe our risk of foreign exchange loss and exposure to credit and interest rate risks are mitigated as a result of our right to receive a preferred return on our investments in our unconsolidated entities. Our preferred returns as stated in the governing venture agreements are denominated in U.S. dollars.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, our management, including our principal executive officer and principal financial officer, concluded that our disclosure controls and procedures are effective as of the end of the period covered by this report.

Changes in Internal Controls over Financial Reporting

During the most recent fiscal quarter, there were no changes in our internal controls over financial reporting (as defined under Rule 13a-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

37

PART II OTHER INFORMATION

Item 1. Legal Proceedings – None

Item 1A. Risk Factors – None

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds – None

Item 3. Defaults Upon Senior Securities – None

Item 4. Mine Safety Disclosures – Not Applicable

Item 5. Other Information – None

Item 6. Exhibits

The exhibits required by this item are set forth in the Exhibit Index attached hereto and are filed or incorporated as part of this report.

38

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized, on the 13th day of November, 2015.

	CNL LIFESTYLE PROPERTIES, INC.
By:	/s/ Stephen H. Mauldin
	STEPHEN H. MAULDIN
	President and Chief Executive Officer
	(Principal Executive Officer)
By:	/s/ Tammy J. Tipton
	TAMMY J. TIPTON
	Chief Financial Officer and Treasurer
	(Principal Financial Officer)

39

EXHIBIT INDEX

Exhibits

The following exhibits are included, or incorporated by reference in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 (and are numbered in accordance with Item 601 of Regulation S-K).

Exhibit No.	Description
10.13	First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions by and between the Company and Buyer, dated May 1, 2015. (Filed on May 6, 2015 as Exhibit 10.1 to the Company’s Current Report on Form 8-K, and incorporated herein by reference.)
31.1	Certification of Chief Executive Officer of CNL Lifestyle Properties, Inc., Pursuant to Rule 13a-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith.)
31.2	Certification of Chief Financial Officer of CNL Lifestyle Properties, Inc., Pursuant to Rule 13a-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (Filed herewith.)
32.1	Certification of Chief Executive Officer and Chief Financial Officer of CNL Lifestyle Properties, Inc., Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (Filed herewith.)
101	The following materials from CNL Lifestyle Properties, Inc. Quarterly Report on Form 10-Q for the nine months ended September 30, 2015 formatted in XBRL (Extensible Business Reporting Language); (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Other Comprehensive Income (Losses), (iv) Condensed Consolidated Statements of Stockholders’ Equity, (v) Condensed Consolidated Statements of Cash Flows, and (vi) Notes to the Condensed Consolidated Financial Statements.

40

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

OF CNL LIFESTYLE PROPERTIES, INC.

PURSUANT TO RULE 13a-14(a), AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Stephen H. Mauldin certify that:

1. I have reviewed this quarterly report on Form 10-Q of CNL Lifestyle Properties, Inc. (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15I and 15d-15I) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

	By:	/s/ Stephen H. Mauldin
Date: November 13, 2015		STEPHEN H. MAULDIN
		President and Chief Executive Officer (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

OF CNL LIFESTYLE PROPERTIES, INC.

PURSUANT TO RULE 13a-14(a), AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Tammy J. Tipton, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CNL Lifestyle Properties, Inc. (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

	By:	/s/ Tammy J. Tipton
Date: November 13, 2015		TAMMY J. TIPTON
		Chief Financial Officer and Treasurer (Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of CNL Lifestyle Properties, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2015, as filed with the United States Securities and Exchange Commission on the date hereof (the “Report”), I, Stephen H. Mauldin, Chief Executive Officer and Tammy J. Tipton, Chief Financial Officer of the Company, each certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 13, 2015	By:	/s/ Stephen H. Mauldin
		Stephen H. Mauldin
		President and Chief Executive Officer
Date: November 13, 2015	By:	/s/ Tammy J. Tipton
		Tammy J. Tipton
		Chief Financial Officer and Treasurer

XML

Gross Carrying Amount and Accumulated Amortization of Intangible Assets (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 22,305	$ 22,410
Accumulated Amortization	(4,857)	(4,399)
Net Book Value	17,448	18,011
In place leases
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	11,479	11,584
Accumulated Amortization	(4,857)	(4,399)
Net Book Value	6,622	7,185
Trade name (infinite-lived)
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	10,826	10,826
Net Book Value	$ 10,826	$ 10,826

XML

Adviser and Former Adviser Earned Fees and Incurred Reimbursable Expenses (Detail) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Acquisition fees:
Acquisition fees from distribution reinvestment plan	[1]				$ 319
Acquisition fees from debt proceeds	[2]				1,521
Total					1,840
Asset management fees	[3]	$ 3,702	$ 7,506	$ 15,853	23,584
Reimbursable expenses:
Acquisition costs			64		202
Operating expenses		1,157	1,710	4,286	5,213
Total		1,157	1,774	4,286	5,415
Total fees earned and reimbursable expenses		$ 4,859	$ 9,280	$ 20,139	$ 30,839

[1] Amounts are recorded as acquisition fees and costs in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the Advisor eliminated this fee going forward.

[2] Amounts are recorded as loan costs and are included as part of other assets in the accompanying unaudited condensed consolidated balance sheets. Effective April 1, 2014, the Advisor eliminated this fee going forward.

[3] Amounts are recorded as asset management fees to Advisor including fees related to properties that are classified as assets held for sale that are included as discontinued operations in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the asset management fees to Advisor were reduced as described above.

XML

Fair Value of Financial Assets and Liabilities Carried at Fair Value (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Assets:
Assets held for sale carried at fair value	$ 116,489	$ 122,126
Liabilities:
Derivative instruments	724	1,002
Level 2
Liabilities:
Derivative instruments	724	1,002
Level 3
Assets:
Assets held for sale carried at fair value	$ 116,489	$ 122,126

XML

Real Estate Investment Properties, net - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items]
Depreciation and amortization expenses	$ 19,807	$ 25,389	$ 63,463	$ 73,179
Continuing Operations
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items]
Depreciation and amortization expenses	$ 19,600	$ 25,200	$ 63,000	$ 72,700

XML

Real Estate Investment Properties, net (Tables)

9 Months Ended

Sep. 30, 2015

Schedule of Real Estate Investment Properties

As of September 30, 2015 and December 31, 2014, real estate investment properties consisted of the following (in thousands):

	September 30, 2015			December 31, 2014
Land and land improvements	$	415,783		$	415,968
Leasehold interests and improvements		178,511			180,514
Buildings		272,917			273,210
Equipment		536,433			520,060
Less: accumulated depreciation and amortization		(562,068	)		(507,663	)
Total	$	841,576		$	882,089

XML

Stockholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, shares in Millions	1 Months Ended	9 Months Ended		12 Months Ended
	Mar. 31, 2015	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Stockholders Equity Note [Line Items]
Declared and paid distributions		$ 48,800,000	$ 103,300,000
Declared and paid distributions, per share		$ 0.1500	$ 0.3189	$ 0.4252
Quarterly Dividend Before Amendment Member
Stockholders Equity Note [Line Items]
Declared and paid distributions, per share	$ 0.1063
Quarterly Dividend After Amendment Member
Stockholders Equity Note [Line Items]
Declared and paid distributions, per share	$ 0.0500
Reinvestment Plan
Stockholders Equity Note [Line Items]
Offering proceeds		$ 0	$ 27,200,000
Shares subscribed, shares			4.0

XML

Summary of Financial Information of Unconsolidated Entities (Detail) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015		Sep. 30, 2014
Schedule of Unconsolidated Entities [Line Items]
Revenues		$ 127,600	$ 144,551	$ 285,251		$ 311,588
Property operating expenses		(56,256)	(62,450)	(145,315)		(153,609)
Depreciation and amortization		(19,807)	(25,389)	(63,463)		(73,179)
Equity in earnings (loss) of unconsolidated entities		1,162	3,176	3,940		6,949
Intrawest Venture
Schedule of Unconsolidated Entities [Line Items]
Revenues		4,503	4,856	13,809		14,694
Property operating expenses		(2,449)	(2,472)	(7,788)		(7,654)
Depreciation and amortization		(807)	(1,118)	(3,375)		(5,455)
Interest income (expense)		(476)	(1,241)	(2,294)		(3,889)
Net income (loss)		771	25	352		(2,304)
Income (loss) allocable to other venture partners	[1],[2]	(408)	(406)	(1,204)		(1,205)
Income (loss) allocable to the Company	[1]	1,179	431	1,556		(1,099)
Amortization of capitalized costs		(17)	(52)	(91)		(158)
Equity in earnings (loss) of unconsolidated entities		1,162	379	1,465		(1,257)
Distribution declared to the Company		1,592	742	6,142		1,892
Distributions received by the Company		918	492	5,093		1,411
Majority-Owned Subsidiary, Unconsolidated
Schedule of Unconsolidated Entities [Line Items]
Revenues		4,503	11,726	24,552		36,343
Property operating expenses		(2,449)	(2,777)	(7,961)		(8,223)
Depreciation and amortization		(807)	(3,445)	(6,413)		(12,234)
Interest income (expense)		(476)	(3,150)	(3,849)		(9,632)
Net income (loss)		771	2,354	6,329		6,254
Income (loss) allocable to other venture partners	[1]	(408)	(938)	2,273		(1,133)
Income (loss) allocable to the Company	[1]	1,179	3,292	4,056		7,387
Amortization of capitalized costs		(17)	(116)	(116)		(438)
Equity in earnings (loss) of unconsolidated entities		1,162	3,176	3,940		6,949
Distribution declared to the Company		1,592	3,601	9,840		10,377
Distributions received by the Company		$ 918	3,321	11,651		9,896
Majority-Owned Subsidiary, Unconsolidated | DMC Partnership
Schedule of Unconsolidated Entities [Line Items]
Revenues			6,870	10,743	[3]	21,649
Property operating expenses			(305)	(173)	[3]	(569)
Depreciation and amortization			(2,327)	(3,038)	[3]	(6,779)
Interest income (expense)			(1,909)	(1,555)	[3]	(5,743)
Net income (loss)			2,329	5,977	[3]	8,558
Income (loss) allocable to other venture partners	[1]		(532)	3,477	[3]	72
Income (loss) allocable to the Company	[1]		2,861	2,500	[3]	8,486
Amortization of capitalized costs			(64)	(25)	[3]	(280)
Equity in earnings (loss) of unconsolidated entities			2,797	2,475	[3]	8,206
Distribution declared to the Company			2,859	3,698	[3]	8,485
Distributions received by the Company			$ 2,829	$ 6,558	[3]	$ 8,485

[1] Income (loss) is allocated between the Company and its venture partner using the hypothetical liquidation book value ("HLBV") method of accounting.

[2] This amount includes the venture partner's portion of interest expense on a loan which the partners made to the venture. These amounts are treated as distributions for the purposes of the HLBV calculation.

[3] On April 29, 2015, the Company completed the sale of its interest in the DMC Partnership as described above. As such, summarized operating data for the partnership is reported through April 29, 2015.

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Summary of Income or Loss from Discontinued Operations (Detail) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenues		$ 12,482	$ 51,619	$ 60,496	$ 146,468
Expenses		(10,286)	(34,256)	(43,774)	(94,297)
Impairment provision				(7,749)	(3,442)
Depreciation and amortization			(8,233)		(28,403)
Operating income		2,196	9,130	8,973	20,326
Gain from sale of real estate		4,266	3,953	210,891	3,883
Gain (loss) on extinguishment of debt	[1]	486	(8,293)	(2,042)	(5,690)
Gain on insurance and retirements		1,024		1,492
Other expense	[2]	(358)	(4,253)	(4,928)	(19,887)
Income (loss) from discontinued operations		$ 7,614	$ 537	$ 214,386	$ (1,368)

[1] During the quarter and nine months ended September 30, 2015, the Company recorded gain (loss) on extinguishment of debt from the sale of one and 38 senior housing properties, respectively. During the quarter and nine months ended September 30, 2014, the Company recorded loss on extinguishment of debt from the sale of its 46 golf properties. In addition, during the nine months ended September 30, 2014, the Company recorded gain on extinguishment of debt from the sale of its multi-family residential property.

[2] Amounts include amortization of loss and loss on termination of cash flow hedge of approximately $3.0 million for the nine months ended September 30, 2014.

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Subsequent Events - Additional information (Detail) $ in Millions	Nov. 13, 2015 USD ($) Property	Oct. 31, 2015 USD ($) Property	Sep. 30, 2015 Property	Dec. 31, 2014 Property
Subsequent Event [Line Items]
Number of properties held for sale			22	61
Subsequent Event | Attractions Properties
Subsequent Event [Line Items]
Sale of properties | $		$ 62.0
Number of properties held for sale		2
Subsequent Event | Ski and Mountain Lifestyle Properties
Subsequent Event [Line Items]
Sale of properties | $	$ 90.5
Number of properties held for sale	1

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Related Party Arrangements - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2015
Monthly
Related Party Transaction [Line Items]
Asset management fee as a percentage of real estate asset value	0.075%
Annually
Related Party Transaction [Line Items]
Asset management fee as a percentage of real estate asset value	0.90%

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Operating activities:
Net cash provided by operating activities	$ 80,940	$ 132,818
Investing activities:
Acquisition of property		(128,390)
Capital expenditures	(35,787)	(55,888)
Proceeds from sale of real estate	757,944	370,774
Proceeds from sale of unconsolidated entity	139,501
Contribution to unconsolidated entity	(54,572)
Proceeds from insurance	3,907
Principal payments received on mortgage loans receivable	2,258	83,459
Changes in restricted cash	11,671	(1,876)
Other		823
Net cash provided by investing activities	824,922	268,902
Financing activities:
Redemption of common stock	(6)	(9,412)
Distributions to stockholders, net of reinvestments in 2014	(48,777)	(76,119)
Proceeds under line of credit		102,500
Proceeds from mortgage loans and other notes payable		57,790
Principal payments on line of credit	(152,500)	(30,000)
Principal payments on mortgage loans and senior notes	(527,975)	(231,846)
Principal payments on capital leases	(2,539)	(4,545)
Payments of entrance fee refunds		(1,257)
Payment of loan costs	(239)	(3,204)
Net cash (used in) provided by financing activities	(732,036)	(196,093)
Effect of exchange rate fluctuations on cash	(85)	(79)
Net increase in cash	173,741	205,548
Cash at beginning of period	136,985	71,574
Cash at end of period	310,726	$ 277,122
Supplemental disclosure of non-cash financing activities:
Assumption of mortgage loans by third party	$ 151,478

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Mortgages and Other Notes Receivable, net - Additional Information (Detail) - USD ($) $ in Millions	Sep. 30, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Estimated fair market value of company's mortgages and other notes receivable	$ 7.6	$ 16.6
Mortgage and Other Notes Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loan loss provision	$ 9.4

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2015

Fair Value of Financial Assets and Liabilities Carried at Fair Value

The following tables show the fair value of the Company’s financial assets and liabilities carried at fair value as of September 30, 2015 and December 31, 2014, as follows (in thousands):

	Fair Value Measurement as of September 30, 2015		Level 1		Level 2		Level 3
Assets:
Assets held for sale carried at fair value	$	116,489	$	—	$	—	$	116,489
Liabilities:
Derivative instruments	$	724	$	—	$	724	$	—

	Fair Value Measurement as of December 31, 2014		Level 1		Level 2		Level 3
Assets:
Assets held for sale carried at fair value	$	122,126	$	—	$	—	$	122,126
Liabilities:
Derivative instruments	$	1,002	$	—	$	1,002	$	—

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Unconsolidated Entities (Tables)

9 Months Ended

Sep. 30, 2015

Summarized Operating Data of Unconsolidated Entities

The following tables present financial information for the Company’s unconsolidated entities for the quarters and nine months ended September 30, 2015 and 2014 (in thousands):

Summarized operating data:

	Quarter Ended September 30, 2015
	DMC Partnership(3)		Intrawest Venture			Total
Revenues	$	—	$	4,503		$	4,503
Property operating expenses		—		(2,449	)		(2,449	)
Depreciation and amortization		—		(807	)		(807	)
Interest expense		—		(476	)		(476	)
Net income	$	—	$	771		$	771
Loss allocable to other venture partners (1)	$	—	$	(408	)(2)	$	(408	)
Income allocable to the Company (1)	$	—	$	1,179		$	1,179
Amortization of capitalized costs		—		(17	)		(17	)
Equity in earnings of unconsolidated entities	$	—	$	1,162		$	1,162
Distribution declared to the Company	$	—	$	1,592		$	1,592
Distributions received by the Company	$	—	$	918		$	918

	Quarter Ended September 30, 2014
	DMC Partnership			Intrawest Venture			Total
Revenues	$	6,870		$	4,856		$	11,726
Property operating expenses		(305	)		(2,472	)		(2,777	)
Depreciation and amortization		(2,327	)		(1,118	)		(3,445	)
Interest expense		(1,909	)		(1,241	)		(3,150	)
Net income	$	2,329		$	25		$	2,354
Loss allocable to other venture partners (1)	$	(532	)	$	(406	)(2)	$	(938	)
Income allocable to the Company (1)	$	2,861		$	431		$	3,292
Amortization of capitalized costs		(64	)		(52	)		(116	)
Equity in earnings of unconsolidated entities	$	2,797		$	379		$	3,176
Distribution declared to the Company	$	2,859		$	742		$	3,601
Distributions received by the Company	$	2,829		$	492		$	3,321

	Nine Months Ended September 30, 2015
	DMC Partnership(3)			Intrawest Venture			Total
Revenues	$	10,743		$	13,809		$	24,552
Property operating expenses		(173	)		(7,788	)		(7,961	)
Depreciation and amortization		(3,038	)		(3,375	)		(6,413	)
Interest expense		(1,555	)		(2,294	)		(3,849	)
Net income	$	5,977		$	352		$	6,329
Income (loss) allocable to other venture partners (1)	$	3,477		$	(1,204	)(2)	$	2,273
Income allocable to the Company (1)	$	2,500		$	1,556		$	4,056
Amortization of capitalized costs		(25	)		(91	)		(116	)
Equity in earnings of unconsolidated entities	$	2,475		$	1,465		$	3,940
Distribution declared to the Company	$	3,698		$	6,142		$	9,840
Distributions received by the Company	$	6,558		$	5,093		$	11,651

	Nine Months Ended September 30, 2014
	DMC Partnership			Intrawest Venture			Total
Revenues	$	21,649		$	14,694		$	36,343
Property operating expenses		(569	)		(7,654	)		(8,223	)
Depreciation and amortization		(6,779	)		(5,455	)		(12,234	)
Interest expense		(5,743	)		(3,889	)		(9,632	)
Net income (loss)	$	8,558		$	(2,304	)	$	6,254
Income (loss) allocable to other venture partners (1)	$	72		$	(1,205	)(2)	$	(1,133	)
Income (loss) allocable to the Company (1)	$	8,486		$	(1,099	)	$	7,387
Amortization of capitalized costs		(280	)		(158	)		(438	)
Equity in earnings (loss) of unconsolidated entities	$	8,206		$	(1,257	)	$	6,949
Distribution declared to the Company	$	8,485		$	1,892		$	10,377
Distributions received by the Company	$	8,485		$	1,411		$	9,896

FOOTNOTES:

⁽¹⁾  Income (loss) is allocated between the Company and its venture partner using the hypothetical liquidation book value (“HLBV”) method of accounting.

⁽²⁾  This amount includes the venture partner’s portion of interest expense on a loan which the partners made to the venture. These amounts are treated as distributions for the purposes of the HLBV calculation.

⁽³⁾  On April 29, 2015, the Company completed the sale of its interest in the DMC Partnership as described above. As such, summarized operating data for the partnership is reported through April 29, 2015.

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Indebtedness - Additional Information (Detail)	1 Months Ended			3 Months Ended	9 Months Ended
	Sep. 30, 2015 USD ($) Property	Jun. 30, 2015 USD ($)	May. 31, 2015 Property	Sep. 30, 2014 USD ($)	Sep. 30, 2015 USD ($) Property	Sep. 30, 2014 USD ($)	Dec. 31, 2014 USD ($)
Debt Instrument [Line Items]
Line of Credit repaid					$ 152,500,000	$ 30,000,000
Line of credit	$ 0				$ 0		$ 152,500,000
Debt instrument, maturity date					Aug. 31, 2016
Additional extension option period					1 year
Line of credit borrowing capacity	$ 100,000,000				$ 100,000,000
Senior unsecured notes outstanding		$ 318,300,000
Debt instrument, premium rate		103.625%
Loss on extinguishment of debt				$ (1,620,000)	(21,065,000)	(1,816,000)
Early repayment of senior unsecured notes					209,700,000
Notes prepayment penalty					1,300,000
Payment of mortgage loan					$ 527,975,000	$ 231,846,000
Senior Housing Property
Debt Instrument [Line Items]
Number of properties sold | Property	1		37		38
Payment of mortgage loan					$ 151,500,000
Senior Unsecured Notes
Debt Instrument [Line Items]
Loss on extinguishment of debt		$ (18,800,000)			(4,300,000)
Carrying (Reported) Amount, Fair Value Disclosure
Debt Instrument [Line Items]
Estimated fair values of mortgages and other notes payable, including those related to assets held for sale and line of credit	$ 194,200,000				$ 194,200,000		707,300,000
Estimated fair values of Senior notes							$ 325,400,000

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Related Party Arrangements (Tables)

9 Months Ended

Sep. 30, 2015

Earned Acquisition Fees and Incurred Reimbursable Expenses

For the quarters and nine months ended September 30, 2015 and 2014, respectively, the Advisor collectively earned fees and incurred reimbursable expenses as follows (in thousands):

	Quarters Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Acquisition fees:
Acquisition fees from distribution reinvestment plan (1)	$	—	$	—	$	—	$	319
Acquisition fees from debt proceeds (2)		—		—		—		1,521
Total		—		—		—		1,840
Asset management fees (3)		3,702		7,506		15,853		23,584
Reimbursable expenses: (4)
Acquisition costs		—		64		—		202
Operating expenses		1,157		1,710		4,286		5,213
Total		1,157		1,774		4,286		5,415
Total fees earned and reimbursable expenses	$	4,859	$	9,280	$	20,139	$	30,839

FOOTNOTES:

⁽¹⁾  Amounts are recorded as acquisition fees and costs in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the Advisor eliminated this fee going forward.

⁽²⁾  Amounts are recorded as loan costs and are included as part of other assets in the accompanying unaudited condensed consolidated balance sheets. Effective April 1, 2014, the Advisor eliminated this fee going forward.

⁽³⁾  Amounts are recorded as asset management fees to Advisor including fees related to properties that are classified as assets held for sale that are included as discontinued operations in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the asset management fees to Advisor were reduced as described above.

⁽⁴⁾  Amounts representing acquisition costs are recorded as part of acquisition fees and costs in the accompanying condensed consolidated statements of operations. Amounts representing operating expenses are recorded as part of general and administrative expenses in the accompanying unaudited condensed consolidated statements of operations.

Amounts Due to Affiliates for Fees and Expense

Amounts due to affiliates for fees and expenses described above are as follows (in thousands):

	September 30, 2015		December 31, 2014
Due to the Advisor and its affiliates:
Operating expenses	$	415	$	476
Acquisition fees and expenses		—		13
Total	$	415	$	489

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Organization and Nature of Business - Additional Information (Detail) $ in Thousands	1 Months Ended		3 Months Ended	9 Months Ended
	Jun. 30, 2015 USD ($) Property	Apr. 30, 2015 USD ($)	Sep. 30, 2015 Property	Sep. 30, 2015 USD ($) Property	Sep. 30, 2014 USD ($)
Organization And Nature Of Business [Line Items]
Number of real estate properties | Property			65	65
Aggregate net sales proceeds from sale of properties				$ 757,944	$ 370,774
Attractions properties
Organization And Nature Of Business [Line Items]
Number of properties sold | Property	1			1
Gain or loss on sale of properties	$ 25,700
Aggregate net sales proceeds from sale of properties	$ 134,500
Unconsolidated Joint Ventures
Organization And Nature Of Business [Line Items]
Number of real estate properties | Property			7	7
DMC Partnership | Majority-Owned Subsidiary, Unconsolidated
Organization And Nature Of Business [Line Items]
Company's ownership percentage sold		81.98%	81.98%	81.98%
Proceed from sale of interest in joint venture		$ 139,500		$ 139,500
Gain or loss on sale of properties				$ 39,300
Golf Facilities
Organization And Nature Of Business [Line Items]
Number of properties sold | Property				48
Senior Housing Property
Organization And Nature Of Business [Line Items]
Number of properties sold | Property			1	38
Senior Housing and Attraction Properties
Organization And Nature Of Business [Line Items]
Gain or loss on sale of properties				$ 236,300
Aggregate net sales proceeds from sale of properties				$ 757,944
Canada
Organization And Nature Of Business [Line Items]
Number of real estate properties | Property			3	3
Minimum
Organization And Nature Of Business [Line Items]
Long-term lease				5 years
Maximum
Organization And Nature Of Business [Line Items]
Long-term lease				20 years

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	9 Months Ended		12 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Declared and paid distributions, per share	$ 0.1500	$ 0.3189	$ 0.4252

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Schedule of Real Estate Investment Properties (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Real Estate Properties [Line Items]
Less: accumulated depreciation and amortization	$ (562,068)	$ (507,663)
Real estate investment properties, net	841,576	882,089
Land and land improvements
Real Estate Properties [Line Items]
Real estate investment properties, Total	415,783	415,968
Leasehold interests and improvements
Real Estate Properties [Line Items]
Real estate investment properties, Total	178,511	180,514
Buildings
Real Estate Properties [Line Items]
Real estate investment properties, Total	272,917	273,210
Equipment
Real Estate Properties [Line Items]
Real estate investment properties, Total	$ 536,433	$ 520,060

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Intangibles, net - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Intangible Assets Disclosure [Line Items]
Amortization of intangible assets	$ 0.2	$ 0.2	$ 0.5	$ 0.5

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Assets
Real estate investment properties, net (including $60,763 and $67,789 related to consolidated variable interest entities, respectively)	$ 841,576	$ 882,089
Assets held for sale, net (including $89,811 and $103,753 related to consolidated variable interest entities, respectively)	259,285	968,641
Investments in unconsolidated entities	72,679	127,102
Cash	310,726	136,985
Deferred rent and lease incentives	41,758	47,307
Restricted cash	28,565	35,227
Other assets	17,461	29,091
Intangibles, net	17,448	18,011
Accounts and other receivables, net	21,450	20,398
Mortgages and other notes receivable, net	7,570	19,361
Total Assets	1,618,518	2,284,212
LIABILITIES AND STOCKHOLDERS' EQUITY
Mortgages and other notes payable (including $19,923 and $20,642 related to non-recourse debt of consolidated variable interest entities, respectively)	187,643	397,849
Senior notes, net of discount		316,846
Liabilities related to assets held for sale		171,745
Line of credit	0	152,500
Other liabilities	40,318	41,388
Accounts payable and accrued expenses	23,949	46,005
Due to affiliates	415	489
Total Liabilities	$ 252,325	$ 1,126,822
Commitments and contingencies (Note 13)
Stockholders' equity:
Preferred stock, $.01 par value per share 200 million shares authorized and unissued
Excess shares, $.01 par value per share 120 million shares authorized and unissued	$ 0	$ 0
Common stock, $.01 par value per share One billion shares authorized; 349,084 shares issued and 325,183 and 325,184 shares outstanding as of September 30, 2015 and December 31, 2014, respectively	3,252	3,252
Capital in excess of par value	2,863,833	2,863,839
Accumulated deficit	(232,738)	(494,129)
Accumulated distributions	(1,260,079)	(1,211,302)
Accumulated other comprehensive loss	(8,075)	(4,270)
Total Stockholders' Equity	1,366,193	1,157,390
Total Liabilities and Stockholders' Equity	$ 1,618,518	$ 2,284,212

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Fair Value Measurements - Additional Information (Detail) $ in Millions	Sep. 30, 2015 USD ($) Property Derivative	Dec. 31, 2014 Property Derivative
Fair Value Measurements Disclosure [Line Items]
Number of investment properties Held for Sale	22	61
Level 3
Fair Value Measurements Disclosure [Line Items]
Number of investment properties Held for Sale	19	19
Interest Rate Swap
Fair Value Measurements Disclosure [Line Items]
Remaining hedges qualified as highly effective | Derivative	1	2
Interest rate swap notional amount | $	$ 8.1
Interest Rate Swap | Terminated Interest Rate Contracts
Fair Value Measurements Disclosure [Line Items]
Interest rate swap notional amount | $	$ 14.2

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSSES - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Net income	$ 40,845	$ 30,623	$ 261,391	$ 1,765
Other comprehensive income (loss):
Foreign currency translation adjustments	(2,254)	(1,478)	(4,084)	(1,383)
Changes in fair value of cash flow hedges:
Amortization of loss and loss on termination of cash flow hedges		56	180	3,487
Unrealized gain (loss) arising during the period	(53)	204	99	816
Total other comprehensive income (loss)	(2,307)	(1,218)	(3,805)	2,920
Total comprehensive income	$ 38,538	$ 29,405	$ 257,586	$ 4,685

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Properties Classified as Assets Held for Sale (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	$ 259,285	$ 968,641
Land and land improvements
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	57,711	213,129
Leasehold interests and improvements
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	48,910	52,589
Building and Building Improvements
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	106,510	599,923
Equipment
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	31,312	59,345
Deferred Rent And Lease Incentives
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net		4,832
Other Assets
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	7,426	10,919
Restricted cash
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	5,938	14,714
Intangibles, net
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	1,027	10,503
Accounts and other receivables, net
Long Lived Assets Held-for-sale [Line Items]
Assets held for sale, net	$ 451	$ 2,687

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2015

Commitments and Contingencies

13. Commitments and Contingencies:

From time to time the Company may be exposed to litigation arising from operations of its business in the ordinary course of business. Management is not aware of any litigation that it believes will have a material adverse impact on the Company’s financial condition or results of operations.

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Liabilities Held for Sale (Detail) $ in Thousands	Dec. 31, 2014 USD ($)
Assets and Liabilities Held for Sale [Line Items]
Mortgages and other notes payable	$ 152,655
Other liabilities	19,090
Total	$ 171,745

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Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2015

Principles of Consolidation and Basis of Presentation

Principles of Consolidation and Basis of Presentation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States (“GAAP”). The unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which, in the opinion of management are necessary for the fair statement of the Company’s results for the interim period presented. Operating results for the quarter and nine months ended September 30, 2015 may not be indicative of the results that may be expected for the year ending December 31, 2015. Amounts as of December 31, 2014 included in the unaudited condensed consolidated financial statements have been derived from audited consolidated financial statements as of that date but do not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

The accompanying unaudited condensed consolidated financial statements include the Company’s accounts, the accounts of wholly owned subsidiaries or subsidiaries for which the Company has a controlling interest, the accounts of variable interest entities (“VIEs”) in which the Company is the primary beneficiary, and the accounts of other subsidiaries over which the Company has a controlling financial interest. All material intercompany accounts and transactions have been eliminated in consolidation.

In accordance with the guidance for the consolidation of VIEs, the Company analyzes its variable interests, including loans, leases, guarantees, and equity investments, to determine if the entity in which it has a variable interest is a VIE. The Company’s analysis includes both quantitative and qualitative reviews. The Company bases its quantitative analysis on the forecasted cash flows of the entity and its qualitative analysis on its review of the design of the entity, its organizational structure including decision-making ability and financial agreements. The Company also uses its quantitative and qualitative analyses to determine if it is the primary beneficiary of the VIE, and if such determination is made, it includes the accounts of the VIE in its consolidated financial statements.

Use of Estimates

Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods and the disclosure of contingent liabilities. For example, significant estimates and assumptions are made in connection with the analysis of real estate, equity method investments and impairments. Actual results could differ from those estimates.

Reclassifications

Reclassifications — Certain amounts in the prior year’s condensed consolidated financial statements have been reclassified to conform to current year presentation with no effect on previously reported net loss or equity. See Note 4. “Assets and Associated Liabilities Held for Sale, net of Discontinued Operations” for additional information.

Adopted Accounting Pronouncements

Adopted Accounting Pronouncements — In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“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.” This update changes the criteria for reporting discontinued operations where only disposals representing a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, such as a major line of business or geographical area, should be presented as a discontinued operation. This ASU is effective prospectively for all disposals (or classifications as held for sale) of components of an entity that occur on or after the effective date. As a result, no changes were made for properties classified as held for sale prior to January 1, 2015. Effective January 1, 2015, the Company adopted this ASU. This ASU impacts the determination of which property disposals qualify as discontinued operations, as well as requires additional disclosures about discontinued operations.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” as a new ASC topic (Topic 606). The core principle of this amendment is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard further provides guidance for any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards (for example, lease contracts). This ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016, expected to be deferred one year, including interim periods within that reporting period, with earlier adoption not permitted. ASU 2014-09 can be adopted using one of two retrospective application methods: 1) retrospectively to each prior reporting period presented or 2) as a cumulative-effect adjustment as of the date of adoption. The adoption of ASU 2014-09 will not have a significant effect on the Company’s consolidated financial position, results of operations or cash flows.

Recent Accounting Pronouncements

Recent Accounting Pronouncements — In April 2015, the FASB issued ASU 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that loan costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts or premiums. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The ASU is to be applied retrospectively for each period presented. Upon adoption, an entity is required to comply with the applicable disclosures for a change in an accounting principle. The FASB subsequently issued ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements,” which clarifies that, given the absence of authoritative guidance in ASU 2015-03 regarding presentation and subsequent measurement of loan costs related to line-of-credit arrangements, the SEC Staff would not object to an entity deferring and presenting loan costs as an asset and subsequently amortizing the loan costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company has determined that it will not early adopt this ASU and that the amendments will not materially impact the presentation of the Company’s consolidated financial position and will not have a material impact on the Company’s consolidated results of operations or cash flows.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments,” which requires an acquirer to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The Company has determined that it will not early adopt this ASU and does not expect that adopting this guidance will have a material impact on its consolidated financial position, results of operations or cash flows.

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Capital in Excess of Par Value	Accumulated Deficit	Accumulated Distributions	Accumulated Other Comprehensive Loss
Balance at Dec. 31, 2013	$ 1,368,378	$ 3,226	$ 2,846,265	$ (401,985)	$ (1,073,422)	$ (5,706)
Balance at Dec. 31, 2013		322,627
Subscriptions received for stock through public offering reinvestment plan (in shares)		3,970
Subscriptions received for stock through public offering reinvestment plan	27,209	$ 40	27,169
Redemption of common stock (in shares)		(1,413)
Redemption of common stock	(9,609)	$ (14)	(9,595)
Net income (loss)	(92,144)			(92,144)
Distributions, declared and paid ($0.4252 per share for 2014 and $0.1500 per share for 2015)	(137,880)				(137,880)
Foreign currency translation adjustment	(2,933)					(2,933)
Amortization of loss on termination of cash flow hedge	3,486					3,486
Current period adjustment to recognize changes in fair value of cash flow hedges, net of reclassification (Note 9)	$ 883					883
Balance at Dec. 31, 2014	325,184	325,184
Balance at Dec. 31, 2014	$ 1,157,390	$ 3,252	2,863,839	(494,129)	(1,211,302)	(4,270)
Redemption of common stock (in shares)		(1)
Redemption of common stock	(6)		(6)
Net income (loss)	261,391			261,391
Distributions, declared and paid ($0.4252 per share for 2014 and $0.1500 per share for 2015)	(48,777)				(48,777)
Foreign currency translation adjustment	(4,084)					(4,084)
Amortization of loss on termination of cash flow hedge	180					180
Current period adjustment to recognize changes in fair value of cash flow hedges, net of reclassification (Note 9)	$ 99					99
Balance at Sep. 30, 2015	325,183	325,183
Balance at Sep. 30, 2015	$ 1,366,193	$ 3,252	$ 2,863,833	$ (232,738)	$ (1,260,079)	$ (8,075)

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Real estate investment properties, net, variable interest entities	$ 60,763	$ 67,789
Asset held for sale net, variable interest entities	89,811	103,753
Mortgages and other notes payable, variable interest entities	$ 19,923	$ 20,642
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	200,000,000	200,000,000
Preferred stock, shares unissued	200,000,000	200,000,000
Excess shares, par value	$ 0.01	$ 0.01
Excess shares, shares authorized	120,000,000	120,000,000
Excess shares, shares unissued	120,000,000	120,000,000
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	349,084,000	349,084,000
Common stock, shares outstanding	325,183,000	325,184,000

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Indebtedness

9 Months Ended

Sep. 30, 2015

Indebtedness

8. Indebtedness:

Line of Credit — During the nine months ended September 30, 2015, the Company repaid approximately $152.5 million of principal. In June 2015, the Company extended the maturity date of its revolving line of credit to August 31, 2016, with an additional one year extension option, and reduced the borrowing capacity to $100 million. As of September 30, 2015, the Company’s revolving line of credit did not have an outstanding principal balance.

Senior Unsecured Notes — In June 2015, the Company repaid all of its senior unsecured notes with an outstanding principal balance of $318.3 million at a premium of 103.625%. In connection with this repayment, the Company recorded a loss on extinguishment of debt of approximately $18.8 million.

Fixed and Variable Rate Debt — During the nine months ended September 30, 2015, the Company repaid approximately $209.7 million of outstanding indebtedness prior to their scheduled maturity and recorded a loss on extinguishment of debt of approximately $4.3 million, which included a prepayment penalty of $1.3 million. Also, in connection with the sale of its 38 senior housing properties, the buyer of these properties assumed approximately $151.5 million of outstanding indebtedness collateralized by the senior housing properties that were sold.

Certain of the Company’s loans require the Company to meet certain customary financial covenants and ratios including fixed charge coverage ratio, leverage ratio, interest coverage ratio and limitations on distributions except as required to maintain the Company’s REIT status. The Company was in compliance with all applicable provisions as of September 30, 2015.

The estimated fair values of mortgages and other notes payable, including those related to assets held for sale, and the line of credit were approximately $194.2 million and $707.3 million as of September 30, 2015 and December 31, 2014, respectively, based on rates and spreads the Company would expect to obtain for similar borrowings with similar loan terms. Because this methodology includes inputs that are less observable by the public and are not necessarily reflected in active markets, the measurement of the estimated fair values related to the Company’s mortgage notes payable is categorized as Level 3 on the three-level valuation hierarchy. The estimated fair values of the senior notes was approximately $325.4 million as of December 31, 2014, based on prices traded for similar or identical instruments in active or inactive markets and were categorized as Level 2 on the three-level valuation hierarchy. The senior notes were repaid in June 2015 as described above. The estimated fair value of accounts payable and accrued expenses approximates the carrying value as of September 30, 2015 and December 31, 2014 because of the relatively short maturities of the obligations.

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Nov. 05, 2015
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q3
Trading Symbol	ck0001261159
Entity Registrant Name	CNL LIFESTYLE PROPERTIES INC
Entity Central Index Key	0001261159
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		325,183,002

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Fair Value Measurements

9 Months Ended

Sep. 30, 2015

Fair Value Measurements

9. Fair Value Measurements:

The Company had 19 investment properties that were classified as assets held for sale at September 30, 2015 and December 31, 2014, respectively, that were recorded at fair value less estimated costs to sell for each period presented. The Level 3 unobservable inputs used in determining the fair value of the real estate properties included negotiated sales prices with third party buyers, comparable sales transactions and information from potential buyers.

As of December 31, 2014, the Company had two hedges that qualified as highly effective and, accordingly, all of the change in value was reflected in other comprehensive income (loss). During the nine months ended September 30, 2015, one of the loans was paid in full and the corresponding interest rate swap with an aggregate notional amount of approximately $14.2 million was terminated. As a result, the ineffective portion of the change in fair value resulting from the termination of the hedge included in other comprehensive loss in the accompanying condensed consolidated balance sheets was reclassified to interest expense and loan cost amortization in the accompanying condensed consolidated statements of operations in income (loss) from continuing operations for the nine months ended September 30, 2015. As of September 30, 2015, the Company had one interest rate swap with a notional amount of approximately $8.1 million. Determining fair value and testing effectiveness of this financial instrument requires management to make certain estimates and judgments. Changes in assumptions could have a positive or negative impact on the estimated fair values and measured effectiveness of such instruments could, in turn, impact the Company’s results of operations.

The Company’s derivative instruments are valued primarily based on inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, volatilities, and credit risks) and are classified as Level 2 in the fair value hierarchy. The valuation of derivative instruments also includes a credit value adjustment which is a Level 3 input. However, the impact of the assumption is not significant to its overall valuation calculation, and therefore the Company considers its derivative instruments to be classified as Level 2. The fair value of such instruments is included in other liabilities in the accompanying unaudited condensed consolidated balance sheets.

The following tables show the fair value of the Company’s financial assets and liabilities carried at fair value as of September 30, 2015 and December 31, 2014, as follows (in thousands):

	Fair Value Measurement as of September 30, 2015		Level 1		Level 2		Level 3
Assets:
Assets held for sale carried at fair value	$	116,489	$	—	$	—	$	116,489
Liabilities:
Derivative instruments	$	724	$	—	$	724	$	—

	Fair Value Measurement as of December 31, 2014		Level 1		Level 2		Level 3
Assets:
Assets held for sale carried at fair value	$	122,126	$	—	$	—	$	122,126
Liabilities:
Derivative instruments	$	1,002	$	—	$	1,002	$	—

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Revenues:
Rental income from operating leases	$ 29,574	$ 31,720	$ 92,625	$ 97,634
Property operating revenues	97,901	110,866	191,145	205,910
Interest income on mortgages and other notes receivable	125	1,965	1,481	8,044
Total revenues	127,600	144,551	285,251	311,588
Expenses:
Property operating expenses	56,256	62,450	145,315	153,609
Asset management fees to advisor	3,665	4,394	12,193	14,173
General and administrative	2,984	4,320	11,467	13,172
Ground lease and permit fees	2,426	2,192	7,819	7,843
Acquisition fees and costs		(237)		519
Other operating expenses	1,731	1,878	4,875	3,858
Bad debt expense	3,256	26	8,092	34
Loan loss provision	21	750	9,369	3,270
Impairment provisions	1,428		1,428
Depreciation and amortization	19,807	25,389	63,463	73,179
Total expenses	91,574	101,162	264,021	269,657
Operating income	36,026	43,389	21,230	41,931
Other income (expense):
Interest and other income	309	153	1,066	449
Interest expense and loan cost amortization	(3,202)	(15,012)	(23,946)	(44,380)
Loss on extinguishment of debt		(1,620)	(21,065)	(1,816)
Equity in earnings of unconsolidated entities	1,162	3,176	3,940	6,949
Total other expense	(1,731)	(13,303)	(40,005)	(38,798)
(Loss) income from continuing operations	34,295	30,086	(18,775)	3,133
Income (loss) from discontinued operations (includes $57 and $460 amortization of loss and loss on termination of cash flow hedge for the quarter and nine months ended September 30, 2014, respectively)	7,614	537	214,386	(1,368)
Net income before gain on sale of real estate and unconsolidated entity	41,909	30,623	195,611	1,765
Gain (loss) on sale of real estate	(1,064)		26,528
Gain from sale of unconsolidated entity			39,252
Net income	$ 40,845	$ 30,623	$ 261,391	$ 1,765
Net income per share of common stock (basic and diluted)
Continuing operations	$ 0.11	$ 0.09	$ 0.14	$ 0.01
Discontinued operations	0.02	0.00	0.66	0.00
Net income per share	$ 0.13	$ 0.09	$ 0.80	$ 0.01
Weighted average number of shares of common stock outstanding (basic and diluted)	325,183	325,707	325,183	324,194

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Real Estate Investment Properties, net

9 Months Ended

Sep. 30, 2015

Real Estate Investment Properties, net

3. Real Estate Investment Properties, net:

As of September 30, 2015 and December 31, 2014, real estate investment properties consisted of the following (in thousands):

	September 30, 2015			December 31, 2014
Land and land improvements	$	415,783		$	415,968
Leasehold interests and improvements		178,511			180,514
Buildings		272,917			273,210
Equipment		536,433			520,060
Less: accumulated depreciation and amortization		(562,068	)		(507,663	)
Total	$	841,576		$	882,089

For the quarter and nine months ended September 30, 2015, the Company had depreciation and amortization expenses of approximately $19.6 million and $63.0 million, respectively, as compared to approximately $25.2 million and 72.7 million, respectively, for the quarter and nine months ended September 30, 2014, excluding properties that the Company classified as discontinued operations.

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Significant Accounting Policies

9 Months Ended

Sep. 30, 2015

Significant Accounting Policies

2. Significant Accounting Policies:

Principles of Consolidation and Basis of Presentation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States (“GAAP”). The unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which, in the opinion of management are necessary for the fair statement of the Company’s results for the interim period presented. Operating results for the quarter and nine months ended September 30, 2015 may not be indicative of the results that may be expected for the year ending December 31, 2015. Amounts as of December 31, 2014 included in the unaudited condensed consolidated financial statements have been derived from audited consolidated financial statements as of that date but do not include all disclosures required by GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.

The accompanying unaudited condensed consolidated financial statements include the Company’s accounts, the accounts of wholly owned subsidiaries or subsidiaries for which the Company has a controlling interest, the accounts of variable interest entities (“VIEs”) in which the Company is the primary beneficiary, and the accounts of other subsidiaries over which the Company has a controlling financial interest. All material intercompany accounts and transactions have been eliminated in consolidation.

In accordance with the guidance for the consolidation of VIEs, the Company analyzes its variable interests, including loans, leases, guarantees, and equity investments, to determine if the entity in which it has a variable interest is a VIE. The Company’s analysis includes both quantitative and qualitative reviews. The Company bases its quantitative analysis on the forecasted cash flows of the entity and its qualitative analysis on its review of the design of the entity, its organizational structure including decision-making ability and financial agreements. The Company also uses its quantitative and qualitative analyses to determine if it is the primary beneficiary of the VIE, and if such determination is made, it includes the accounts of the VIE in its consolidated financial statements.

Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods and the disclosure of contingent liabilities. For example, significant estimates and assumptions are made in connection with the analysis of real estate, equity method investments and impairments. Actual results could differ from those estimates.

Reclassifications — Certain amounts in the prior year’s condensed consolidated financial statements have been reclassified to conform to current year presentation with no effect on previously reported net loss or equity. See Note 4. “Assets and Associated Liabilities Held for Sale, net of Discontinued Operations” for additional information.

Adopted Accounting Pronouncements — In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“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.” This update changes the criteria for reporting discontinued operations where only disposals representing a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, such as a major line of business or geographical area, should be presented as a discontinued operation. This ASU is effective prospectively for all disposals (or classifications as held for sale) of components of an entity that occur on or after the effective date. As a result, no changes were made for properties classified as held for sale prior to January 1, 2015. Effective January 1, 2015, the Company adopted this ASU. This ASU impacts the determination of which property disposals qualify as discontinued operations, as well as requires additional disclosures about discontinued operations.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers,” as a new ASC topic (Topic 606). The core principle of this amendment is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard further provides guidance for any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards (for example, lease contracts). This ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016, expected to be deferred one year, including interim periods within that reporting period, with earlier adoption not permitted. ASU 2014-09 can be adopted using one of two retrospective application methods: 1) retrospectively to each prior reporting period presented or 2) as a cumulative-effect adjustment as of the date of adoption. The adoption of ASU 2014-09 will not have a significant effect on the Company’s consolidated financial position, results of operations or cash flows.

Recent Accounting Pronouncements — In April 2015, the FASB issued ASU 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that loan costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts or premiums. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The ASU is to be applied retrospectively for each period presented. Upon adoption, an entity is required to comply with the applicable disclosures for a change in an accounting principle. The FASB subsequently issued ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements,” which clarifies that, given the absence of authoritative guidance in ASU 2015-03 regarding presentation and subsequent measurement of loan costs related to line-of-credit arrangements, the SEC Staff would not object to an entity deferring and presenting loan costs as an asset and subsequently amortizing the loan costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company has determined that it will not early adopt this ASU and that the amendments will not materially impact the presentation of the Company’s consolidated financial position and will not have a material impact on the Company’s consolidated results of operations or cash flows.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments,” which requires an acquirer to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. The new guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2015 with early adoption permitted. The Company has determined that it will not early adopt this ASU and does not expect that adopting this guidance will have a material impact on its consolidated financial position, results of operations or cash flows.

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Subsequent Events

9 Months Ended

Sep. 30, 2015

Subsequent Events

14. Subsequent Events:

In October 2015, the Company entered into a purchase and sale agreement for two of its attraction properties for $62.0 million, which exceeds the carrying value of the properties.

In October 2015, the Company collected its only outstanding mortgage receivable.

In November 2015, we entered into a purchase and sale agreement for one of our ski and mountain lifestyle properties for $90.5 million, which exceeds the carrying value of the property.

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Related Party Arrangements

9 Months Ended

Sep. 30, 2015

Related Party Arrangements

10. Related Party Arrangements:

In March 2014, the Company’s Advisor amended its advisory agreement, effective April 1, 2014, to eliminate all acquisition fees on equity, performance fees, debt acquisition fees and disposition fees, and to reduce asset management fees to 0.075% monthly (or 0.90% annually) of invested assets.

For the quarters and nine months ended September 30, 2015 and 2014, respectively, the Advisor collectively earned fees and incurred reimbursable expenses as follows (in thousands):

	Quarters Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Acquisition fees:
Acquisition fees from distribution reinvestment plan (1)	$	—	$	—	$	—	$	319
Acquisition fees from debt proceeds (2)		—		—		—		1,521
Total		—		—		—		1,840
Asset management fees (3)		3,702		7,506		15,853		23,584
Reimbursable expenses: (4)
Acquisition costs		—		64		—		202
Operating expenses		1,157		1,710		4,286		5,213
Total		1,157		1,774		4,286		5,415
Total fees earned and reimbursable expenses	$	4,859	$	9,280	$	20,139	$	30,839

FOOTNOTES:

⁽¹⁾  Amounts are recorded as acquisition fees and costs in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the Advisor eliminated this fee going forward.

⁽²⁾  Amounts are recorded as loan costs and are included as part of other assets in the accompanying unaudited condensed consolidated balance sheets. Effective April 1, 2014, the Advisor eliminated this fee going forward.

⁽³⁾  Amounts are recorded as asset management fees to Advisor including fees related to properties that are classified as assets held for sale that are included as discontinued operations in the accompanying unaudited condensed consolidated statements of operations. Effective April 1, 2014, the asset management fees to Advisor were reduced as described above.

⁽⁴⁾  Amounts representing acquisition costs are recorded as part of acquisition fees and costs in the accompanying condensed consolidated statements of operations. Amounts representing operating expenses are recorded as part of general and administrative expenses in the accompanying unaudited condensed consolidated statements of operations.

Amounts due to affiliates for fees and expenses described above are as follows (in thousands):

	September 30, 2015		December 31, 2014
Due to the Advisor and its affiliates:
Operating expenses	$	415	$	476
Acquisition fees and expenses		—		13
Total	$	415	$	489

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Unconsolidated Entities

9 Months Ended

Sep. 30, 2015

Unconsolidated Entities

6. Unconsolidated Entities:

As of December 31, 2014, the Company held an ownership interest in the DMC Partnership of $104.4 million. The Company sold its 81.98% interest in the DMC Partnership in April 2015 and received net sales proceeds of approximately $139.5 million from its co-venture partner, which resulted in a gain of approximately $39.3 million for financial reporting purposes. No disposition fee was paid to the Advisor on the sale of the DMC Partnership. The Company accounted for its pro-rata share of the net earnings of its investment in the DMC Partnership as continuing operations because although the properties owned by the DMC Partnership were outliers compared to the other assets invested in by the Company, the sale of the Company’s interest in the DMC Partnership did not cause a strategic shift in the Company, and it was not considered to have a major impact on the Company’s business; therefore, it did not qualify as discontinued operations under ASU 2014-08.

As of December 31, 2014, the Company held an 80% ownership interest in the Intrawest Venture. During the nine months ended September 30, 2015, the Company contributed approximately $54.6 million to the Intrawest Venture and the Intrawest Venture repaid mortgage loans of approximately $54.6 million. In July 2015, the co-venture partner of the Intrawest Venture accepted the Company’s offer to acquire the co-venture partner’s 20% interest in the Intrawest Venture in accordance with the buy-sell provisions of the Intrawest Venture partnership agreement. The Company will own a 100% controlling interest in the Intrawest Venture once it acquires the remaining 20% interest from the co-venture partner.

The Intrawest Venture is working with the Canada Revenue Agency to resolve matters related to its entities. The Intrawest Venture’s maximum exposure relating to these matters is approximately $12.1 million. However, the Intrawest Venture believes the more likely than not resolution will be approximately $1.5 million. As such, an accrual of $1.5 million has been reflected in the financial information of the Intrawest Venture.

The following tables present financial information for the Company’s unconsolidated entities for the quarters and nine months ended September 30, 2015 and 2014 (in thousands):

Summarized operating data:

	Quarter Ended September 30, 2015
	DMC Partnership(3)		Intrawest Venture			Total
Revenues	$	—	$	4,503		$	4,503
Property operating expenses		—		(2,449	)		(2,449	)
Depreciation and amortization		—		(807	)		(807	)
Interest expense		—		(476	)		(476	)
Net income	$	—	$	771		$	771
Loss allocable to other venture partners (1)	$	—	$	(408	)(2)	$	(408	)
Income allocable to the Company (1)	$	—	$	1,179		$	1,179
Amortization of capitalized costs		—		(17	)		(17	)
Equity in earnings of unconsolidated entities	$	—	$	1,162		$	1,162
Distribution declared to the Company	$	—	$	1,592		$	1,592
Distributions received by the Company	$	—	$	918		$	918

	Quarter Ended September 30, 2014
	DMC Partnership			Intrawest Venture			Total
Revenues	$	6,870		$	4,856		$	11,726
Property operating expenses		(305	)		(2,472	)		(2,777	)
Depreciation and amortization		(2,327	)		(1,118	)		(3,445	)
Interest expense		(1,909	)		(1,241	)		(3,150	)
Net income	$	2,329		$	25		$	2,354
Loss allocable to other venture partners (1)	$	(532	)	$	(406	)(2)	$	(938	)
Income allocable to the Company (1)	$	2,861		$	431		$	3,292
Amortization of capitalized costs		(64	)		(52	)		(116	)
Equity in earnings of unconsolidated entities	$	2,797		$	379		$	3,176
Distribution declared to the Company	$	2,859		$	742		$	3,601
Distributions received by the Company	$	2,829		$	492		$	3,321

	Nine Months Ended September 30, 2015
	DMC Partnership(3)			Intrawest Venture			Total
Revenues	$	10,743		$	13,809		$	24,552
Property operating expenses		(173	)		(7,788	)		(7,961	)
Depreciation and amortization		(3,038	)		(3,375	)		(6,413	)
Interest expense		(1,555	)		(2,294	)		(3,849	)
Net income	$	5,977		$	352		$	6,329
Income (loss) allocable to other venture partners (1)	$	3,477		$	(1,204	)(2)	$	2,273
Income allocable to the Company (1)	$	2,500		$	1,556		$	4,056
Amortization of capitalized costs		(25	)		(91	)		(116	)
Equity in earnings of unconsolidated entities	$	2,475		$	1,465		$	3,940
Distribution declared to the Company	$	3,698		$	6,142		$	9,840
Distributions received by the Company	$	6,558		$	5,093		$	11,651

	Nine Months Ended September 30, 2014
	DMC Partnership			Intrawest Venture			Total
Revenues	$	21,649		$	14,694		$	36,343
Property operating expenses		(569	)		(7,654	)		(8,223	)
Depreciation and amortization		(6,779	)		(5,455	)		(12,234	)
Interest expense		(5,743	)		(3,889	)		(9,632	)
Net income (loss)	$	8,558		$	(2,304	)	$	6,254
Income (loss) allocable to other venture partners (1)	$	72		$	(1,205	)(2)	$	(1,133	)
Income (loss) allocable to the Company (1)	$	8,486		$	(1,099	)	$	7,387
Amortization of capitalized costs		(280	)		(158	)		(438	)
Equity in earnings (loss) of unconsolidated entities	$	8,206		$	(1,257	)	$	6,949
Distribution declared to the Company	$	8,485		$	1,892		$	10,377
Distributions received by the Company	$	8,485		$	1,411		$	9,896

FOOTNOTES:

⁽¹⁾  Income (loss) is allocated between the Company and its venture partner using the hypothetical liquidation book value (“HLBV”) method of accounting.

⁽²⁾  This amount includes the venture partner’s portion of interest expense on a loan which the partners made to the venture. These amounts are treated as distributions for the purposes of the HLBV calculation.

⁽³⁾  On April 29, 2015, the Company completed the sale of its interest in the DMC Partnership as described above. As such, summarized operating data for the partnership is reported through April 29, 2015.

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Assets and Associated Liabilities Held for Sale, net and Discontinued Operations

9 Months Ended

Sep. 30, 2015

Assets and Associated Liabilities Held for Sale, net and Discontinued Operations

4. Assets and Associated Liabilities Held for Sale, net and Discontinued Operations:

Assets Held for Sale, net — The Company had 22 and 61 properties classified as assets held for sale as of September 30, 2015 and December 31, 2014, respectively. The following table presents the net carrying value of the properties classified as held for sale (in thousands):

	September 30, 2015		December 31, 2014
Land and land improvements	$	57,711	$	213,129
Leasehold interests and improvements		48,910		52,589
Building and building improvements		106,510		599,923
Equipment, net		31,312		59,345
Deferred rent and lease incentives		—		4,832
Other assets		7,426		10,919
Restricted cash		5,938		14,714
Intangibles, net		1,027		10,503
Accounts and other receivables, net		451		2,687
Total	$	259,285	$	968,641

Associated Liabilities Held for Sale — The following table presents the liabilities associated with the assets held for sale related to the senior housing properties (in thousands):

	September 30,		December 31,
	2015		2014
Mortgages and other notes payable	$	—	$	152,655
Other liabilities		—		19,090
Total	$	—	$	171,745

During the nine months ended September 30, 2015, the Company sold all 38 of its senior housing properties and received aggregate net sales proceeds of approximately $623.4 million, which resulted in a gain of approximately $210.6 million for financial reporting purposes. No disposition fee was payable to the Advisor on the sale of the senior housing properties. The third party buyer of the properties assumed $151.5 million of outstanding principal indebtedness collateralized by the senior housing properties that were sold.

In June 2015, the Company sold one of its attractions properties and received net sales proceeds of approximately $134.5 million, which resulted in a gain of approximately $25.7 million for financial reporting purposes. The Company did not pay the Advisor a disposition fee.

During the nine months ended September 30, 2015, the Company recorded approximately $7.7 million in impairment provisions related to the marinas properties (recorded as part of discontinued operations) and recorded $1.4 million in impairment provisions related to its undeveloped land, to adjust their net carrying value to their revised estimated sale price, less closing costs.

Discontinued Operations — The Company classified the revenues and expenses related to all real estate properties sold in 2014, the 37 senior housing properties sold in May 2015 and the one senior housing sold in September 2015, and 17 marinas properties classified as assets held for sale as of December 31, 2014, as discontinued operations in the accompanying unaudited condensed consolidated statements of operations for all periods presented.

The following table is a summary of income (loss) from discontinued operations for the quarter and nine months ended September 30, 2015 and 2014 (in thousands):

	Quarter Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Revenues	$	12,482		$	51,619		$	60,496		$	146,468
Expenses		(10,286	)		(34,256	)		(43,774	)		(94,297	)
Impairment provision		—			—			(7,749	)		(3,442	)
Depreciation and amortization		—			(8,233	)		—			(28,403	)
Operating income		2,196			9,130			8,973			20,326
Gain from sale of real estate		4,266			3,953			210,891			3,883
Gain (loss) on extinguishment of debt (1)		486			(8,293	)		(2,042	)		(5,690	)
Gain on insurance and retirements		1,024			—			1,492			—
Other expense (2)		(358	)		(4,253	)		(4,928	)		(19,887	)
Income (loss) from discontinued operations	$	7,614		$	537		$	214,386		$	(1,368	)

FOOTNOTES:

⁽¹⁾  During the quarter and nine months ended September 30, 2015, the Company recorded gain (loss) on extinguishment of debt from the sale of one and 38 senior housing properties, respectively. During the quarter and nine months ended September 30, 2014, the Company recorded loss on extinguishment of debt from the sale of its 46 golf properties. In addition, during the nine months ended September 30, 2014, the Company recorded gain on extinguishment of debt from the sale of its multi-family residential property.

⁽²⁾  Amounts include amortization of loss and loss on termination of cash flow hedge of approximately $3.0 million for the nine months ended September 30, 2014.

The Company accounted for the revenues and expenses related to one attractions property sold in June 2015, one undeveloped land, one ski and mountain lifestyle and three attractions properties classified as held for sale, as income from continuing operations because the sale of these properties would not cause a strategic shift in the Company nor are they considered to have a major impact on the Company’s business; therefore, they do not qualify as discontinued operations under ASU 2014-08. However, the proposed disposition of the one ski and mountain lifestyle property will represent an individually significant component. The Company recorded net income from continuing operations of approximately $4.0 million and $6.9 million for the quarter and nine months ended September 30, 2015, respectively, and a net income (loss) from continuing operations of $1.9 million and $(0.1) million for the quarter and nine months ended September 30, 2014, respectively, related to the one ski and mountain lifestyle property classified as held for sale.

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Intangibles, net

9 Months Ended

Sep. 30, 2015

Intangibles, net

5. Intangibles, net:

The gross carrying amount and accumulated amortization of the Company’s intangible assets as of September 30, 2015 and December 31, 2014 are as follows (in thousands):

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			September 30, 2015 Net Book Value
In place leases	$	11,479	$	(4,857	)	$	6,622
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,305	$	(4,857	)	$	17,448

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			December 31, 2014 Net Book Value
In place leases	$	11,584	$	(4,399	)	$	7,185
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,410	$	(4,399	)	$	18,011

For each of the quarters and nine months ended September 30, 2015 and 2014, the Company had amortization expense of approximately $0.2 million and $0.5 million, respectively, excluding properties that the Company classified as discontinued operations.

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Mortgages and Other Notes Receivable, net

9 Months Ended

Sep. 30, 2015

Mortgages and Other Notes Receivable, net

7. Mortgages and Other Notes Receivable, net:

During the nine months ended September 30, 2015, the borrower relating to one mortgage receivable, for which the Company restructured the mortgage loan during 2014, continued to experience financial difficulties. Additionally, during the nine months ended September 30, 2015, the Company entered into an agreement to receive an early repayment of its other mortgage receivable at a discounted amount. The Company recorded both mortgage receivables at their net realizable value during the nine months ended September 30, 2015 and in conjunction therewith, recorded loan loss provisions of approximately $9.4 million during the nine months ended September 30, 2015. During the nine months ended September 30, 2015, the Company collected the discounted amount for one of its mortgage receivable. In October 2015, the Company collected its other mortgage receivable at a discounted amount as further described below in Note 14. “Subsequent Events.”

The estimated fair market value of the Company’s one mortgage and other notes receivable was approximately $7.6 million as of September 30, 2015, and $16.6 million as of December 31, 2014 for the two mortgages and other notes receivable, respectively, based on the fair value of the collateral or expected collectible amount as of September 30, 2015 and based on discounted cash flows at December 31, 2014. Because this methodology includes inputs that are not observable by the public and are not necessarily reflected in active markets, the measurement of the estimated fair values related to the Company’s mortgage and other notes receivable is categorized as Level 3 on the three-level valuation hierarchy. The estimated fair value of accounts and other receivables approximates the carrying value as of September 30, 2015 and December 31, 2014 because of the relatively short maturities of the receivables.

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Assets and Associated Liabilities Held for Sale, net and Discontinued Operations - Additional Information (Detail)	1 Months Ended			3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2015 Property	Jun. 30, 2015 USD ($) Property	May. 31, 2015 Property	Sep. 30, 2015 USD ($) Property	Sep. 30, 2014 USD ($)	Sep. 30, 2015 USD ($) Property	Sep. 30, 2014 USD ($)	Dec. 31, 2014 USD ($) Property
Assets Held for Sale and Discontinued Operations [Line Items]
Number of properties held for sale | Property	22			22		22		61
Net proceeds from sale of real estate investments						$ 757,944,000	$ 370,774,000
Sale of properties, outstanding principal indebtedness assumed						527,975,000	231,846,000
Impairment provisions related to real state properties						7,749,000	3,442,000
Impairment provisions				$ 1,428,000		1,428,000
Net income (Loss) from continuing operations				40,845,000	$ 30,623,000	261,391,000	1,765,000	$ (92,144,000)
Property Held For Sale
Assets Held for Sale and Discontinued Operations [Line Items]
Net income (Loss) from continuing operations				$ 4,000,000	$ 1,900,000	$ 6,900,000	$ (100,000)
Attractions properties
Assets Held for Sale and Discontinued Operations [Line Items]
Number of properties sold | Property		1				1
Net proceeds from sale of real estate investments		$ 134,500,000
Gain or loss on sale of properties		25,700,000
Disposition fee		$ 0
Senior Housing Property
Assets Held for Sale and Discontinued Operations [Line Items]
Number of properties sold | Property	1		37			38
Net proceeds from sale of real estate investments						$ 623,400,000
Gain or loss on sale of properties						210,600,000
Disposition fee						0
Sale of properties, outstanding principal indebtedness assumed						$ 151,500,000
Marinas Property
Assets Held for Sale and Discontinued Operations [Line Items]
Number of properties held for sale | Property								17

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Supplemental Guarantor Information - Additional Information (Detail) $ in Millions	1 Months Ended
	Jun. 30, 2015 USD ($)
Supplemental Guarantor Information [Line Items]
Senior unsecured notes outstanding	$ 318.3
Debt instrument, premium rate	103.625%

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Supplemental Guarantor Information

9 Months Ended

Sep. 30, 2015

Supplemental Guarantor Information

12. Supplemental Guarantor Information:

As of December 31, 2014, the Company had senior notes outstanding which were guaranteed by certain of the Company’s consolidated subsidiaries (the “Guarantor Subsidiaries”). As described in Note 8, “Indebtedness,” in June 2015, the Company repaid all of its senior unsecured notes with an outstanding principal amount of $318.3 million at a premium of 103.625%.

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Assets and Associated Liabilities Held for Sale, net and Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2015

Net Carrying Value of Assets Held for Sale

The following table presents the net carrying value of the properties classified as held for sale (in thousands):

	September 30, 2015		December 31, 2014
Land and land improvements	$	57,711	$	213,129
Leasehold interests and improvements		48,910		52,589
Building and building improvements		106,510		599,923
Equipment, net		31,312		59,345
Deferred rent and lease incentives		—		4,832
Other assets		7,426		10,919
Restricted cash		5,938		14,714
Intangibles, net		1,027		10,503
Accounts and other receivables, net		451		2,687
Total	$	259,285	$	968,641

Liabilities Held for Sale

The following table presents the liabilities associated with the assets held for sale related to the senior housing properties (in thousands):

	September 30,		December 31,
	2015		2014
Mortgages and other notes payable	$	—	$	152,655
Other liabilities		—		19,090
Total	$	—	$	171,745

Summary of Income (Loss) from Discontinued Operations

The following table is a summary of income (loss) from discontinued operations for the quarter and nine months ended September 30, 2015 and 2014 (in thousands):

	Quarter Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Revenues	$	12,482		$	51,619		$	60,496		$	146,468
Expenses		(10,286	)		(34,256	)		(43,774	)		(94,297	)
Impairment provision		—			—			(7,749	)		(3,442	)
Depreciation and amortization		—			(8,233	)		—			(28,403	)
Operating income		2,196			9,130			8,973			20,326
Gain from sale of real estate		4,266			3,953			210,891			3,883
Gain (loss) on extinguishment of debt (1)		486			(8,293	)		(2,042	)		(5,690	)
Gain on insurance and retirements		1,024			—			1,492			—
Other expense (2)		(358	)		(4,253	)		(4,928	)		(19,887	)
Income (loss) from discontinued operations	$	7,614		$	537		$	214,386		$	(1,368	)

FOOTNOTES:

⁽¹⁾  During the quarter and nine months ended September 30, 2015, the Company recorded gain (loss) on extinguishment of debt from the sale of one and 38 senior housing properties, respectively. During the quarter and nine months ended September 30, 2014, the Company recorded loss on extinguishment of debt from the sale of its 46 golf properties. In addition, during the nine months ended September 30, 2014, the Company recorded gain on extinguishment of debt from the sale of its multi-family residential property.

⁽²⁾  Amounts include amortization of loss and loss on termination of cash flow hedge of approximately $3.0 million for the nine months ended September 30, 2014.

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Amounts Due to Affiliates for Fees and Expenses (Detail) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Related Party Transaction [Line Items]
Due to affiliates	$ 415	$ 489
Operating expenses
Related Party Transaction [Line Items]
Due to affiliates	$ 415	476
Acquisition fees and expenses
Related Party Transaction [Line Items]
Due to affiliates		$ 13

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Unconsolidated Entities - Additional Information (Detail) - USD ($)	1 Months Ended	9 Months Ended		12 Months Ended
	Apr. 30, 2015	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Variable Interest Entity [Line Items]
Investments in unconsolidated entities		$ 72,679,000		$ 127,102,000
Payment of mortgage loan		527,975,000	$ 231,846,000
DMC Partnership | Majority-Owned Subsidiary, Unconsolidated
Variable Interest Entity [Line Items]
Investments in unconsolidated entities				$ 104,400,000
Proceed from sale of interest in joint venture	$ 139,500,000	$ 139,500,000
Company's ownership percentage sold	81.98%	81.98%
Gain on Disposal of Discontinued Operations	$ 39,300,000
Disposition fee	$ 0
Intrawest Venture | Majority-Owned Subsidiary, Unconsolidated
Variable Interest Entity [Line Items]
Payment of mortgage loan		$ 54,600,000
Percentage of ownership by parent		100.00%		80.00%
Noncontrolling interest, ownership percentage by noncontrolling owners				20.00%
Canada Revenue Agency
Variable Interest Entity [Line Items]
Maximum exposure to loss on investment		$ 12,100,000
Accruals for loss on investment		$ 1,500,000

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2014
Amortization of loss and loss on termination of cash flow hedges	$ 56	$ 3,487
Discontinued Operations
Amortization of loss and loss on termination of cash flow hedges	$ 57	$ 460

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Organization and Nature of Business

9 Months Ended

Sep. 30, 2015

Organization and Nature of Business

1. Organization and Nature of Business:

CNL Lifestyle Properties, Inc. (the “Company”), was organized in Maryland on August 11, 2003. The Company operates and has elected to be taxed as a real estate investment trust (a “REIT”) for federal income tax purposes. Various wholly-owned subsidiaries have been and will be formed by the Company for the purpose of acquiring and owning direct or indirect interests in real estate. The Company generally invests in lifestyle properties in the United States that are primarily leased on a long-term (generally five to 20-years, plus multiple renewal options), triple-net or gross basis to tenants or operators that the Company considers to be industry leading. The Company also leases properties to taxable REIT subsidiary (“TRS”) tenants and engages independent third-party managers to operate those properties. In the event of certain tenant defaults, the Company has also engaged third-party managers to operate properties on its behalf until they are re-leased. The Company has engaged CNL Lifestyle Advisor Corporation (the “Advisor”) as its Advisor to provide management, acquisition, disposition, advisory and administrative services.

As of September 30, 2015, the Company owned 65 lifestyle properties directly and indirectly within the following asset classes: ski and mountain lifestyle, attractions, marinas and other lifestyle properties. Seven of these 65 properties were owned through one unconsolidated joint venture and three were located in Canada.

In March 2014, the Company engaged Jefferies LLC, a leading global investment banking and advisory firm, to assist the Company’s management and its board of directors in actively evaluating various strategic alternatives to provide liquidity to the Company’s shareholders. In connection with this process, during 2014 the Company sold its entire golf portfolio (consisting of 48 properties) and its multi-family development property. Additionally, during the first nine months of 2015, the Company (i) sold its 81.98% interest in the DMC Partnership for net sales proceeds of approximately $139.5 million to its co-venture partner, for a gain of approximately $39.3 million, (ii) sold all 38 of its senior housing properties and one of its attractions properties for aggregate net sales proceeds of approximately $757.9 million, which resulted in aggregate gains of approximately $236.3 million, (iii) entered into a purchase and sale agreement for the sale of the marinas portfolio for approximately its carrying value, and (iv) as of September 30, 2015, had a contract in place to sell one attraction property, a letter of intent to sell two attraction properties, a plan to sell a ski and mountain lifestyle property, and a plan to sell its undeveloped land. See Note 14. “Subsequent Events” for additional information.

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Intangibles, net (Tables)

9 Months Ended

Sep. 30, 2015

Gross Carrying Amount and Accumulated Amortization of Intangible Assets

The gross carrying amount and accumulated amortization of the Company’s intangible assets as of September 30, 2015 and December 31, 2014 are as follows (in thousands):

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			September 30, 2015 Net Book Value
In place leases	$	11,479	$	(4,857	)	$	6,622
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,305	$	(4,857	)	$	17,448

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			December 31, 2014 Net Book Value
In place leases	$	11,584	$	(4,399	)	$	7,185
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,410	$	(4,399	)	$	18,011

Gross Carrying Amount and Accumulated Amortization of Intangible Assets

The gross carrying amount and accumulated amortization of the Company’s intangible assets as of September 30, 2015 and December 31, 2014 are as follows (in thousands):

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			September 30, 2015 Net Book Value
In place leases	$	11,479	$	(4,857	)	$	6,622
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,305	$	(4,857	)	$	17,448

Intangible Assets	Gross Carrying Amount		Accumulated Amortization			December 31, 2014 Net Book Value
In place leases	$	11,584	$	(4,399	)	$	7,185
Trade name (infinite-lived)		10,826		—			10,826
Total	$	22,410	$	(4,399	)	$	18,011

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Summary of Income or Loss from Discontinued Operations (Parenthetical) (Detail) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2015 Property	Sep. 30, 2014 Property	Sep. 30, 2015 Property	Sep. 30, 2014 USD ($) Property
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Amortization of loss and loss on termination of cash flow hedges | $				$ 3.0
Senior Housing Property
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of properties sold	1		38
Golf Properties
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of properties sold		46		46

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Stockholders' Equity

9 Months Ended

Sep. 30, 2015

Stockholders' Equity

11. Stockholders’ Equity:

Distribution Reinvestment Plan — For the nine months ended September 30, 2014, the Company received aggregate proceeds of approximately $27.2 million (representing 4.0 million shares) through its DRP. On September 4, 2014, the Company’s board of directors approved the suspension of its DRP, effective as of September 26, 2014. As a result of the suspension of the DRP, beginning with the September 2014 quarterly distributions, stockholders who were participants in the DRP received cash distributions instead of additional shares in the Company. The Company did not receive any proceeds through its DRP for the nine months ended September 30, 2015.

Distributions — In March 2015, the Company’s board of directors reduced the quarterly distributions from $0.1063 per share to $0.05 per share to stockholders of record at the close of business on March 9, 2015. For the nine months ended September 30, 2015 and 2014, the Company declared and paid distributions of approximately $48.8 million ($0.15 per share) and $103.3 million ($0.3189 per share), respectively.