INVESTMENTS IN UNCONSOLIDATED ENTITIES

3 Months Ended

Mar. 31, 2023

Equity Method Investments and Joint Ventures [Abstract]

NOTE 6—INVESTMENTS IN UNCONSOLIDATED ENTITIES

We report investments in unconsolidated entities over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. We are not required to consolidate these entities because our joint venture partners have significant participating rights, nor are these entities considered VIEs, as they are controlled by equity holders with sufficient capital. We invest in both real estate entities and operating entities which are described further below.

Investments in Unconsolidated Real Estate Entities

Through our Ventas Investment Management Platform, which combines our extensive third-party capital ventures under a single platform, we partner with third-party institutional investors to invest in healthcare real estate through various joint ventures and other co-investment vehicles where we are the sponsor or general partner.

Below is a summary of our investments in unconsolidated real estate entities as of March 31, 2023 and December 31, 2022, respectively (dollars in thousands):


	Ownership as of (1)		Carrying Amount as of
	March 31, 2023	December 31, 2022	March 31, 2023		December 31, 2022
Investment in unconsolidated real estate entities:
Ventas Life Science & Healthcare Real Estate Fund	21.0%	21.0%	$	261,319	$	263,979
Pension Fund Joint Venture	23.3%	22.9%	28,490		25,028
Research & Innovation Development Joint Venture	51.5%	51.0%	307,791		284,962
Ventas Investment Management Platform			597,600		573,969
Atrium Health & Wake Forest Joint Venture	48.5%	48.5%	9,359		5,403
All other (2)	34.0%-38.0%	34.0%-38.0%	(953)		577
Total investments in unconsolidated real estate entities			$	606,006	$	579,949

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(1) The entities in which we have an ownership interest may have less than a 100% interest in the underlying real estate. The ownership percentages in the table reflect our interest in the underlying real estate. Joint venture members, including us in some instances, have equity participation rights based on the underlying performance of the investments, which could result in non pro rata distributions.

(2) Includes investments in land parcels, parking structures and other de minimis investments in unconsolidated real estate entities.

We provide various services to our unconsolidated real estate entities in exchange for fees and reimbursements. Total management fees earned in connection with these services were $3.6 million and $3.5 million for the three months ended March 31, 2023 and 2022, respectively. Such amounts are included in third party capital management revenues in our Consolidated Statements of Income.

Investments in Unconsolidated Operating Entities

We own investments in unconsolidated operating entities such as Ardent and Atria, which are included within other assets on our Consolidated Balance Sheets. Our 34% ownership interest in Atria entitles us to customary minority rights and protections, including the right to appoint two members to the Atria Board of Directors.

As of March 31, 2023, we held a 9.8% ownership interest in Ardent, which entitled us to customary minority rights and protections, including the right to appoint one member to the Ardent Board of Directors. In May 2023, we sold

approximately 24% of our ownership interest in Ardent to a third-party investor for approximately $50 million in total proceeds. As a result of the sale, we expect to recognize approximately $34 million of gain in the second quarter of 2023 in income from unconsolidated entities in our Consolidated Statements of Income and our ownership interest in Ardent will be reduced to approximately 7.5%. Following the transaction, we continue to have the same minority rights and protections, including the right to appoint one member to the Ardent Board of Directors.