Assets and Associated Liabilities Held For Sale and Discontinued Operations |
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Real Estate Liabilities Associated With Assets Held For Development And Sale [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Associated Liabilities Held For Sale and Discontinued Operations |
As of March 31, 2019, as part of executing on Possible Strategic Alternatives, the Company had committed to a plan to sell a total of 70 properties, including: (1) six skilled nursing facilities located in Arkansas (“Perennial Communities”); (2) a portfolio of 53 MOBs, five post-acute care facilities and five acute care hospitals located across the U.S. (collectively, the “MOB/Healthcare Portfolio”); and (3) a post-acute care property located in Colorado (“Welbrook Senior Living Grand Junction”). As such, the Company has classified the 70 properties as held for sale. The Company believes the sale of the MOB/Healthcare Portfolio would cause a strategic shift in the Company’s operations and, therefore, has classified the operations of those properties as discontinued operations. The sale of the other seven properties would not cause a strategic shift in the Company’s operations, and are not considered individually significant; therefore, those properties do not qualify as discontinued operations. In December 2018, the Company entered into the MOB Sale Agreement related to the 55 property MOB Sale for a gross price of $1.25 billion, subject to certain pro-rations and other adjustments as described in the MOB Sale Agreement. As of March 31, 2019, approximately $76 million had been placed by the buyer in escrow, which is non-refundable, except for a seller breach or default under the MOB Sale Agreement, and will be applied to the purchase price at closing. The parties anticipate that the closing of the MOB Sale will occur in the second quarter of 2019, subject to customary closing conditions, governmental and other third-party consents. There can be no assurance that the closing conditions will be satisfied or that the MOB Sale will be consummated. The net sales proceeds are expected to exceed the net carrying value of the 55 properties comprising the MOB Sale. In March 2019, the Company entered into the IRF Sale Agreement related to the IRF Sale, consisting of four properties within the MOB/Healthcare Portfolio, for a gross sales price of $94 million, subject to certain pro-rations and other adjustments as described in the IRF Sale Agreement. The Company completed the IRF Sale in April 2019; refer to Note 14. “Subsequent Events” for additional information. As of March 31, 2019, the 70 properties classified as assets held for sale and the liabilities associated with those assets held for sale consisted of the following (in thousands):
As of December 31, 2018, the 70 properties classified as assets held for sale and the liabilities associated with those assets held for sale consisted of the following (in thousands):
The Company classified the revenues and expenses related to the Company’s MOB/Healthcare Portfolio, which consists of 63 properties, as discontinued operations in the accompanying condensed consolidated statements of operations, as it believes the sale of these properties represents a strategic shift in the Company’s operations. The following table is a summary of the Company’s loss from discontinued operations for the three months ended March 31, 2019 and 2018 (in thousands):
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