10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2011

OR

o 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: 1-10989

Ventas, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Delaware	61-1055020
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

111 S. Wacker Drive, Suite 4800
Chicago, Illinois
(Address of Principal Executive Offices)

60606
(Zip Code)

(877) 483-6827
(Registrant’s Telephone Number, Including Area Code)

Not Applicable
(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 þ No o

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 þ No o

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 þ Accelerated filer o Non-accelerated filer o Smaller reporting company o

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class of Common Stock:	Outstanding at October 31, 2011:
Common Stock, $0.25 par value	287,921,317

VENTAS, INC.
FORM 10-Q

INDEX

	Page
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements		3
Consolidated Balance Sheets as of September 30, 2011 and December 31, 2010		3
Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2011 and 2010		4
Consolidated Statements of Equity for the Nine Months Ended September 30, 2011 and the Year Ended December 31, 2010		5
Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2011 and 2010		6
Notes to Consolidated Financial Statements		7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		45
Item 3. Quantitative and Qualitative Disclosures About Market Risk		69
Item 4. Controls and Procedures		71
PART II — OTHER INFORMATION
Item 1. Legal Proceedings		72
Item 1A. Risk Factors		72
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		75
Item 6. Exhibits		76
Exhibit 12.1
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 32.2
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

2

PART I—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

VENTAS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share amounts)

	September 30,			December 31,
	2011			2010
	(Unaudited)			(Audited)
Assets
Real estate investments:
Land and improvements	$	1,584,842		$	559,072
Buildings and improvements		15,289,744			6,035,295
Construction in progress		60,978			6,519
Acquired lease intangibles		821,613			146,813
		17,757,177			6,747,699
Accumulated depreciation and amortization		(1,761,135	)		(1,468,180	)
Net real estate property		15,996,042			5,279,519
Secured loans receivable, net		302,264			149,263
Investments in unconsolidated entities		119,322			15,332
Net real estate investments		16,417,628			5,444,114
Cash and cash equivalents		57,482			21,812
Escrow deposits and restricted cash		84,783			38,940
Deferred financing costs, net		12,424			19,533
Other assets		633,453			233,622
Total assets	$	17,205,770		$	5,758,021
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	6,313,141		$	2,900,044
Accrued interest		65,985			19,296
Accounts payable and other liabilities		1,128,706			207,143
Deferred income taxes		274,852			241,333
Total liabilities		7,782,684			3,367,816
Redeemable OP unitholder interests		92,817			—
Commitments and contingencies
Equity:
Ventas stockholders’ equity:
Preferred stock, $1.00 par value; 10,000 shares authorized, unissued		—			—
Common stock, $0.25 par value; 600,000 and 300,000 shares authorized at September 30, 2011 and December 31, 2010, respectively; 287,962 and 157,279 shares issued at September 30, 2011 and December 31, 2010, respectively		72,025			39,391
Capital in excess of par value		9,595,495			2,576,843
Accumulated other comprehensive income		19,237			26,868
Retained earnings (deficit)		(439,015	)		(255,628	)
Treasury stock, 37 and 14 shares at September 30, 2011 and December 31, 2010, respectively		(1,980	)		(748	)
Total Ventas stockholders’ equity		9,245,762			2,386,726
Noncontrolling interest		84,507			3,479
Total equity		9,330,269			2,390,205
Total liabilities and equity	$	17,205,770		$	5,758,021

See accompanying notes.

3

VENTAS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except per share amounts)

	For the Three Months						For the Nine Months
	Ended September 30,						Ended September 30,
	2011			2010			2011			2010
Revenues:
Rental income:
Triple-net leased	$	211,479		$	117,906		$	450,211		$	351,625
Medical office buildings		58,398			22,817			106,392			47,246
		269,877			140,723			556,603			398,871
Resident fees and services		276,364			113,182			593,348			331,535
Medical office building and other services revenue		9,271			6,711			26,050			6,711
Income from loans and investments		10,072			4,014			24,548			11,336
Interest and other income		373			35			529			420
Total revenues		565,957			264,665			1,201,078			748,873
Expenses:
Interest		73,756			45,519			170,046			133,449
Depreciation and amortization		161,027			52,104			293,541			154,458
Property-level operating expenses:
Senior living		188,856			74,066			403,706			219,802
Medical office buildings		20,305			7,941			37,259			16,267
		209,161			82,007			440,965			236,069
Medical office building services costs		6,347			4,633			19,837			4,633
General, administrative and professional fees		20,624			15,278			51,010			35,819
Loss on extinguishment of debt		8,685			—			25,211			6,549
Litigation proceeds, net		(85,327	)		—			(85,327	)		—
Merger-related expenses and deal costs		69,350			5,142			131,606			11,668
Other		14,436			(419	)		6,664			(404	)
Total expenses		478,059			204,264			1,053,553			582,241
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		87,898			60,401			147,525			166,632
Income (loss) from unconsolidated entities		182			(392	)		(71	)		(392	)
Income tax benefit (expense)		13,904			(1,657	)		23,310			(2,352	)
Income from continuing operations		101,984			58,352			170,764			163,888
Discontinued operations		—			542			—			7,139
Net income		101,984			58,894			170,764			171,027
Net (loss) income attributable to noncontrolling interest (net of tax of $0 and $613 for the three months ended 2011 and 2010, respectively, and $0 and $1,591 for the nine months ended 2011 and 2010, respectively)		(901	)		996			(781	)		2,443
Net income attributable to common stockholders	$	102,885		$	57,898		$	171,545		$	168,584
Earnings per common share:
Basic:
Income from continuing operations attributable to common stockholders	$	0.36		$	0.37		$	0.82		$	1.03
Discontinued operations		—			0.00			—			0.05
Net income attributable to common stockholders	$	0.36		$	0.37		$	0.82		$	1.08
Diluted:
Income from continuing operations attributable to common stockholders	$	0.35		$	0.37		$	0.81		$	1.02
Discontinued operations		—			0.00			—			0.05
Net income attributable to common stockholders	$	0.35		$	0.37		$	0.81		$	1.07
Weighted average shares used in computing earnings per common share:
Basic		287,365			156,631			208,470			156,566
Diluted		290,794			157,941			210,850			157,453
Dividends declared per common share	$	0.4486		$	0.535		$	1.725		$	1.605

See accompanying notes.

4

VENTAS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

For the Nine Months Ended September 30, 2011 and the Year Ended December 31, 2010

(In thousands, except per share amounts)

						Accumulated
	Common		Capital in			Other			Retained						Total Ventas
	Stock Par		Excess of			Comprehensive			Earnings			Treasury			Stockholders’			Noncontrolling
	Value		Par Value			Income			(Deficit)			Stock			Equity			Interest			Total Equity
Balance at January 1, 2010	$	39,160	$	2,573,039		$	19,669		$	(165,710	)	$	(647	)	$	2,465,511		$	18,549		$	2,484,060
Comprehensive Income:
Net income		—		—			—			246,167			—			246,167			3,562			249,729
Foreign currency translation		—		—			6,951			—			—			6,951			—			6,951
Change in unrealized gain on marketable debt securities		—		—			354			—			—			354			—			354
Other		—		—			(106	)		—			—			(106	)		—			(106	)
Comprehensive income		—		—			—			—			—			253,366			3,562			256,928
Net change in noncontrolling interest		—		(18,503	)		—			—			—			(18,503	)		(18,632	)		(37,135	)
Dividends to common stockholders — $2.14 per share		—		—			—			(336,085	)		—			(336,085	)		—			(336,085	)
Issuance of common stock for stock plans		197		21,076			—			—			3,371			24,644			—			24,644
Grant of restricted stock, net of forfeitures		34		1,231			—			—			(3,472	)		(2,207	)		—			(2,207	)
Balance at December 31, 2010		39,391		2,576,843			26,868			(255,628	)		(748	)		2,386,726			3,479			2,390,205
Comprehensive Income:
Net income		—		—			—			171,545			—			171,545			(781	)		170,764
Foreign currency translation		—		—			(4,234	)		—			—			(4,234	)		—			(4,234	)
Change in unrealized gain on marketable debt securities		—		—			(2,964	)		—			—			(2,964	)		—			(2,964	)
Other		—		—			(433	)		—			—			(433	)		—			(433	)
Comprehensive income		—		—			—			—			—			163,914			(781	)		163,133
Acquisition-related activity		31,202		6,711,054			—			—			(4,326	)		6,737,930			83,702			6,821,632
Net change in noncontrolling interest		—		(3,170	)		—			—			—			(3,170	)		(1,893	)		(5,063	)
Dividends to common stockholders — $1.725 per share		—		—			—			(354,932	)		—			(354,932	)		—			(354,932	)
Issuance of common stock		1,390		298,311			—			—			—			299,701			—			299,701
Issuance of common stock for stock plans		9		14,402			—			—			307			14,718			—			14,718
Adjust redeemable OP unitholder interests to current fair value		—		1,582			—			—			—			1,582			—			1,582
Grant of restricted stock, net of forfeitures		33		(3,527	)		—			—			2,787			(707	)		—			(707	)
Balance at September 30, 2011	$	72,025	$	9,595,495		$	19,237		$	(439,015	)	$	(1,980	)	$	9,245,762		$	84,507		$	9,330,269

See accompanying notes.

5

VENTAS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	For the Nine Months
	Ended September 30,
	2011			2010
Cash flows from operating activities:
Net income	$	170,764		$	171,027
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization (including amounts in discontinued operations)		293,541			154,922
Amortization of deferred revenue and lease intangibles, net		(15,454	)		(4,580	)
Other non-cash amortization		(6,185	)		6,455
Change in fair value of financial instruments		2,898			—
Stock-based compensation		13,596			10,128
Straight-lining of rental income, net		(9,254	)		(7,975	)
Loss on extinguishment of debt		25,211			6,549
Net gain on sale of real estate assets (including amounts in discontinued operations)		—			(5,393	)
Gain on real estate loan investments		(3,255	)		—
Gain on sale of marketable securities		(733	)		—
Income tax (benefit) expense		(23,310	)		2,352
Loss from unconsolidated entities		71			392
Other		2,004			(8	)
Changes in operating assets and liabilities:
Increase in other assets		(27,009	)		(9,017	)
Increase in accrued interest		19,141			15,763
Increase in accounts payable and other liabilities		1,875			5,504
Net cash provided by operating activities		443,901			346,119
Cash flows from investing activities:
Net investment in real estate property		(344,687	)		(239,157	)
Purchase of noncontrolling interest		(3,319	)		—
Investment in loans receivable		(619,859	)		(38,725	)
Proceeds from real estate disposals		14,961			25,597
Proceeds from loans receivable		138,934			1,552
Proceeds from sale of marketable securities		23,050			—
Development project expenditures		(23,233	)		(1,649	)
Capital expenditures		(28,658	)		(11,594	)
Other		(113	)		(4,500	)
Net cash used in investing activities		(842,924	)		(268,476	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		434,000			233,004
Proceeds from debt		957,753			201,237
Repayment of debt		(895,043	)		(331,378	)
Payment of deferred financing costs		(1,898	)		(1,872	)
Issuance of common stock, net		299,926			—
Cash distribution to common stockholders		(354,932	)		(251,921	)
Cash distribution to redeemable OP unitholders		(4,038	)		—
Contributions from noncontrolling interest		2			818
Distributions to noncontrolling interest		(1,997	)		(6,633	)
Other		1,017			5,426
Net cash provided by (used in) financing activities		434,790			(151,319	)
Net increase (decrease) in cash and cash equivalents		35,767			(73,676	)
Effect of foreign currency translation on cash and cash equivalents		(97	)		69
Cash and cash equivalents at beginning of period		21,812			107,397
Cash and cash equivalents at end of period	$	57,482		$	33,790
Supplemental schedule of non-cash activities:
Assets and liabilities assumed from acquisitions:
Real estate investments	$	11,034,620		$	125,846
Other assets acquired		431,679			(385	)
Debt assumed		3,508,226			125,320
Other liabilities		992,122			141
Deferred income tax liability		43,889			—
Redeemable OP unitholder interests		100,430			—
Noncontrolling interests		83,702			—
Equity issued		6,737,930			—

See accompanying notes.

6

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — DESCRIPTION OF BUSINESS

Ventas, Inc. (together with its subsidiaries, unless otherwise indicated or except where the context otherwise requires, “we,” “us” or “our”) is a real estate investment trust (“REIT”) with a geographically diverse portfolio of seniors housing and healthcare properties in the United States and Canada. As of September 30, 2011, our portfolio consisted of 1,361 properties: 673 seniors housing communities, 398 skilled nursing facilities, 47 hospitals and 243 medical office buildings (“MOBs”) and other properties in 46 states, the District of Columbia and two Canadian provinces. We are a constituent member of the S&P 500^® index, a leading indicator of the large cap U.S. equities market, with our headquarters located in Chicago, Illinois.

Our primary business consists of acquiring and owning seniors housing and healthcare properties and leasing those properties to unaffiliated tenants or operating those properties through independent third party managers. Through our Lillibridge Healthcare Services, Inc. (“Lillibridge”) subsidiary and our ownership interest in PMB Real Estate Services LLC (“PMBRES”), which we acquired in July 2011 in connection with our acquisition of Nationwide Health Properties, Inc. (“NHP”), we also provide management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make real estate loans and other investments relating to seniors housing and healthcare companies or properties.

As of September 30, 2011, we leased 927 of our properties (excluding MOBs) to healthcare operating companies under “triple-net” or “absolute-net” leases that obligate the tenants to pay all property-related expenses (including maintenance, utilities, repairs, taxes, insurance and capital expenditures), and we engaged independent third parties, such as Sunrise Senior Living, Inc. (together with its subsidiaries, “Sunrise”) and Atria Senior Living, Inc. (“Atria”), to manage 199 of our seniors housing communities pursuant to long-term management agreements.

NOTE 2 — ACCOUNTING POLICIES

The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”), and with the Securities and Exchange Commission (“SEC”) instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. Operating results for the three and nine months ended September 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011. The accompanying Consolidated Financial Statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2010, filed with the SEC on February 18, 2011. Certain prior period amounts have been reclassified to conform to the current period presentation.

Principles of Consolidation

The accompanying Consolidated Financial Statements include our accounts and the accounts of our wholly owned subsidiaries and the joint venture entities over which we exercise control. All intercompany transactions and balances have been eliminated in consolidation, and net earnings are reduced by the portion of net earnings attributable to noncontrolling interests.

We apply FASB guidance for arrangements with variable interest entities (“VIEs”), which requires us to identify entities for which control is achieved through means other than voting rights and to determine which business enterprise is the primary beneficiary of the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. We consolidate investments in VIEs when we are determined to be the primary beneficiary of the VIE. We may change our original assessment of a VIE due to events such as the modification of contractual arrangements that affects the characteristics or adequacy of the entity’s equity investments at risk and the disposal of all or a portion of an interest held by the primary beneficiary. We identify the primary beneficiary of a VIE as the enterprise that has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance; and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the entity. We perform this analysis on an ongoing basis. At September 30, 2011, we did not have any unconsolidated VIEs.

7

We also apply FASB guidance related to investments in joint ventures based on the type of rights held by the limited partner(s) which may preclude consolidation by the sole general partner in certain circumstances in which the general partner would otherwise consolidate the joint venture. We assess limited partners’ rights and their impact on the presumption of control of the limited partnership by the sole general partner when an investor becomes the sole general partner and we reassess if (i) there is a change to the terms or in the exercisability of the rights of the limited partners, (ii) the sole general partner increases or decreases its ownership of limited partnership interests, or (iii) there is an increase or decrease in the number of outstanding limited partnership interests. We also apply this guidance to managing member interests in limited liability companies.

Revenue Recognition

Triple-Net Leased Properties and MOB Operations

Certain of our triple-net leases, including the majority of our leases with Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”), and most of our MOB leases provide for periodic and determinable increases in base rent. We recognize base rental revenues under these leases on a straight-line basis over the applicable lease term when collectibility is reasonably assured. Recognizing rental income on a straight-line basis results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in other assets on our Consolidated Balance Sheets. At September 30, 2011 and December 31, 2010, this net cumulative excess totaled $95.5 million and $86.3 million, respectively.

Our master lease agreements with Kindred Healthcare, Inc. (together with its subsidiaries, “Kindred”) (the “Kindred Master Leases”) and certain of our other leases provide for periodic increases in base rent only if certain revenue parameters or other substantive contingencies are met. We recognize the increased rental revenue under these leases as the related parameters or contingencies are met, rather than on a straight-line basis over the applicable lease term.

Senior Living Operations

We recognize resident fees and services, other than move-in fees, monthly as services are provided. We recognize move-in fees on a straight-line basis over the average resident stay. Our lease agreements with residents generally have a term of twelve to eighteen months and are cancelable by the resident upon 30 days’ notice.

Other

We recognize interest income from loans, including discounts and premiums, using the effective interest method when collectibility is reasonably assured. The effective interest method is applied on a loan-by-loan basis, and discounts and premiums are recognized as yield adjustments over the related loan term. We recognize interest income on an impaired loan to the extent our estimate of the fair value of the collateral is sufficient to support the balance of the loan, other receivables and all related accrued interest. When the balance of the loans, other receivables and all related accrued interest is equal to our estimate of the fair value of the collateral, we recognize interest income on a cash basis. We provide a reserve against an impaired loan to the extent our total investment in the loan exceeds our estimate of the fair value of the loan collateral.

We recognize income from rent, lease termination fees, management advisory services and all other income when all of the following criteria are met in accordance with SEC Staff Accounting Bulletin 104: (i) the applicable agreement has been fully executed and delivered; (ii) services have been rendered; (iii) the amount is fixed or determinable; and (iv) collectibility is reasonably assured.

8

Allowances

We assess the collectibility of our rent receivables, including straight-line rent receivables, in accordance with the applicable accounting standards and our reserve policy, and we defer recognition of revenue if collectibility is not reasonably assured. Our assessment of the collectibility of rent receivables (excluding straight-line receivables) is based on several factors, including, among other things, payment history, the financial strength of the tenant and any guarantors, the value of the underlying collateral, if any, and current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to recover the full value of the receivable, we provide a reserve against the portion of the receivable that we estimate may not be recovered. Our assessment of the collectibility of straight-line receivables is based on several factors, including, among other things, the financial strength of the tenant and any guarantors, the historical operations and operating trends of the property, the historical payment pattern of the tenant, and the type of property. If our evaluation of these factors indicates it is probable that we will be unable to receive the rent payments due in the future, we defer recognition of the straight-line rental income and, in certain circumstances, provide a reserve against the previously recognized straight-line rent receivable asset for a portion, up to its full value, that we estimate may not be recovered. If we change our assumptions or estimates regarding the collectibility of future rent payments required by a lease, we may adjust our reserve to increase or reduce the rental revenue recognized and/or to increase or reduce the reserve against the existing straight-line rent receivable.

Business Combinations

We account for acquisitions using the acquisition method and allocate the cost of the properties acquired among tangible and recognized intangible assets and liabilities based upon their estimated fair values as of the acquisition date. Recognized intangibles primarily include the value of in-place leases, acquired lease contracts, tenant and customer relationships, trade names/trademarks and goodwill. We do not amortize goodwill, which is included in other assets on our Consolidated Balance Sheets and represents the excess of the purchase price paid over the fair value of the net assets of the acquired business.

We estimate the fair value of buildings acquired on an as-if-vacant basis and depreciate the building value over the estimated remaining life of the building. We determine the allocated value of other fixed assets, such as site improvements and furniture, fixtures and equipment, based upon the replacement cost and depreciate such value over the assets’ estimated remaining useful lives. We determine the value of land by considering the sales prices of similar properties in recent transactions or based on (i) internal analyses of recently acquired and existing comparable properties within our portfolio or (ii) real estate tax assessed values in relation to the total value of the asset. The fair value of acquired lease intangibles, if any, reflects (i) the estimated value of any above and/or below market leases, determined by discounting the difference between the estimated market rent and the in-place lease rent, the resulting intangible asset or liability of which is amortized to revenue over the remaining life of the associated lease plus any bargain renewal periods, and (ii) the estimated value of in-place leases related to the cost to obtain tenants, including tenant allowances, tenant improvements and leasing commissions, and an estimated value of the absorption period to reflect the value of the rent and recovery costs foregone during a reasonable lease-up period as if the acquired space was vacant, which is amortized to amortization expense over the remaining life of the associated lease. We estimate the fair value of tenant or other customer relationships acquired, if any, by considering the nature and extent of existing business relationships with the tenant or customer, growth prospects for developing new business with the tenant or customer, the tenant’s credit quality, expectations of lease renewals with the tenant, and the potential for significant, additional future leasing arrangements with the tenant and amortize that value over the expected life of the associated arrangements or leases, including the remaining terms of the related leases and any expected renewal periods. We estimate the fair value of trade names/trademarks using a royalty rate methodology and amortize that value over the estimated useful life of the trade name/trademark.

In connection with a business combination, we may assume the rights and obligations under certain lease agreements pursuant to which we become the lessee of a given property. We assume the lease classification previously determined by the prior lessee absent a modification in the assumed lease agreement. In connection with our recent acquisitions, all capital leases acquired or assumed contain bargain purchase options that we intend to exercise. Therefore, we recognized an asset based on the acquisition date fair value of the underlying property and a liability based on the acquisition date fair value of the capital lease. We assess capital leases that contain bargain purchase options are depreciated over the asset’s useful life. We assess assumed operating leases, including ground leases, to determine if the lease terms are favorable or unfavorable given current market conditions on the acquisition date. To the extent the lease arrangement is favorable or unfavorable relative to market conditions on the acquisition date, we recognize an intangible asset or liability at fair value. The recognized asset or liability (excluding purchase option intangibles) for these leases is amortized to interest or rental expense over the applicable lease term and is included in our Consolidated Statements of Income. All lease-related intangible assets are included within acquired lease intangibles and all lease-related intangible liabilities are included within accounts payable and other liabilities, on our Consolidated Balance Sheets.

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For loans receivable acquired in connection with a business combination, we determine fair value by discounting the estimated future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The estimated future cash flows reflect our judgment regarding the uncertainty of those cash flows and, therefore, we do not establish a valuation allowance at the acquisition date. The difference between the acquisition date fair value and the total expected cash flows is recognized as interest income using an effective interest method over the life of the applicable loan. Subsequent to the acquisition date, we evaluate changes regarding the uncertainty of future cash flows and the need for a valuation allowance.

We estimate the fair value of investments in unconsolidated entities and noncontrolling interests assumed using assumptions that are consistent with those used in valuing all of the underlying assets and liabilities.

We calculate the fair value of long-term debt by discounting the remaining contractual cash flows on each instrument at the current market rate for those borrowings, which we approximate based on the rate we would expect to incur to replace the instrument on the date of acquisition, and recognize any fair value adjustments related to long-term debt as effective yield adjustments over the remaining term of the instrument.

We record a liability for contingent consideration at fair value as of the acquisition date (which is included in accounts payable and other liabilities on our Consolidated Balance Sheets) and reassess the fair value at the end of each reporting period, with any changes being recognized in earnings. Increases or decreases in the fair value of contingent consideration can result from changes in discount periods, discount rates and probabilities that contingencies will be met.

Loans Receivable

Loans receivable, other than those acquired in connection with a business combination, are recorded on our Consolidated Balance Sheets at the unpaid principal balance, net of any deferred origination fees, purchase discounts or premiums and valuation allowances. Unsecured loans receivable are included in other assets on our Consolidated Balance Sheets. We amortize net deferred origination fees, which are comprised of loan fees collected from the borrower net of certain direct costs, and purchase discounts or premiums over the contractual life of the loan using the effective interest method and recognize any unamortized balances in income immediately if the loan is repaid before its contractual maturity.

We regularly evaluate the collectibility of loans receivable based on several factors, including without limitation (i) corporate and facility-level financial and operational reports, (ii) compliance with any financial covenants set forth in the applicable loan agreement, (iii) the financial strength of the borrower and any guarantor, (iv) the payment history of the borrower, and (v) current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to collect all amounts due according to the terms of the applicable loan agreement, we provide a reserve against the portion of the receivable that we estimate may not be collected.

Leases

We include assets under capital leases within net real estate assets, and we include capital lease obligations within senior notes payable and other debt, on our Consolidated Balance Sheets. Lease payments under capital lease arrangements are segregated between interest expense and a reduction to the outstanding principal balance, using the effective interest method. We account for payments made pursuant to operating leases in our Consolidated Statements of Income based on actual rent paid, plus or minus a straight-line rent adjustment for minimum lease escalators.

Derivative Instruments

We recognize all derivative instruments in either other assets or accounts payable and accrued liabilities on our Consolidated Balance Sheets at fair value as of the reporting date. We recognize changes in the fair value of derivative instruments in other expenses on our Consolidated Statements of Income or accumulated other comprehensive income on our Consolidated Balance Sheets, depending on the intended use of the derivative and our designation of the instrument.

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We do not use our derivative financial instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, for trading or speculative purposes. Our interest rate caps were designated as having a hedging relationship with their underlying securities and therefore meet the criteria for hedge accounting under GAAP. Our interest rate caps are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in accumulated other comprehensive income on our Consolidated Balance Sheets. Our interest rate swaps and foreign currency forward contracts were not designated as having a hedging relationship with their underlying securities and therefore do not meet the criteria for hedge accounting under GAAP. Our interest rate swaps and foreign currency forward contracts are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in current earnings (in other expenses) on our Consolidated Statements of Income.

Redeemable Limited Partnership Unitholder Interests

As part of the NHP acquisition, we acquired a majority interest in NHP/PMB L.P. (“NHP/PMB”), a limited partnership that was formed in 2008 to acquire properties from entities affiliated with Pacific Medical Buildings LLC. We consolidate NHP/PMB, as our wholly owned subsidiary is the general partner and exercises control. As of September 30, 2011, third party investors owned 2,375,027 Class A limited partnership units in NHP/PMB (“OP Units”), which represented 29.1% of the total units then outstanding, and we owned 5,795,210 Class B limited partnership units in NHP/PMB, representing the remaining 70.9%. At any time following the first anniversary of the date of issuance, the OP Units may be redeemed, at the election of the holder, for cash or, at our option, 0.7866 shares of our common stock per unit, subject to adjustment in certain circumstances. We are party to a registration rights agreement with the holders of the OP Units that requires us, subject to the terms and conditions set forth therein, to file and maintain a registration statement relating to the issuance of shares of our common stock upon redemption of OP Units. As registration rights are outside of our control, the redeemable OP unitholder interests are classified outside of permanent equity on our Consolidated Balance Sheets. We applied the provisions of ASC Topic 480, Distinguishing Liabilities from Equity, to reflect the redeemable OP unitholder interests at the greater of cost or fair value. As of September 30, 2011, the fair value of the redeemable OP unitholder interests was $92.8 million. The change in fair value from the acquisition date to September 30, 2011 has been recorded through capital in excess of par value. Our diluted earnings per share (“EPS”) includes the effect of any potential shares outstanding from these OP Units.

Noncontrolling Interests

For entities that we control (and thus consolidate) but do not own 100% of the equity, the portion of the equity we do not own is presented as noncontrolling interests and classified as a component of consolidated equity. Each such entity’s contribution to our income and earnings per share is based on income attributable to the entity’s parent and is included in net income attributable to common stockholders on our Consolidated Statements of Income. As our ownership of a controlled subsidiary increases or decreases, any difference between the aggregate consideration paid to acquire the noncontrolling interests and our noncontrolling interest balance is recorded as a component of equity in additional paid-in capital, so long as we maintain a controlling ownership interest.

As of September 30, 2011 and December 31, 2010, we had controlling interests in 29 properties and six properties, respectively, owned through joint ventures. The noncontrolling interest in these properties as of September 30, 2011 and December 31, 2010 was $84.5 million and $3.5 million, respectively. For the three months ended September 30, 2011 and 2010, we recorded a loss attributable to noncontrolling interests of $0.9 million and income attributable to noncontrolling interests of $1.0 million, respectively. For the nine months ended September 30, 2011 and 2010, we recorded a loss attributable to noncontrolling interests of $0.8 million and income attributable to noncontrolling interests of $2.4 million, respectively.

Fair Values of Financial Instruments

Fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, FASB guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels one and two of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within level three of the hierarchy).

Level one inputs utilize unadjusted quoted prices for identical assets or liabilities in active markets that the reporting entity has the ability to access. Level two inputs are inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets, as well as other inputs for the asset or liability, such as interest rates, foreign exchange rates and yield curves, that are observable at commonly quoted intervals. Level three inputs are unobservable inputs for the asset or liability, which are typically based on the reporting entity’s own assumptions, as there is little, if any, related market activity. If the determination of the fair value measurement is based on inputs from different levels of the hierarchy, the level within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

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We use the following methods and assumptions in estimating fair value of financial instruments:

• Cash and cash equivalents: The carrying amount of unrestricted cash and cash equivalents reported on our Consolidated Balance Sheets approximates fair value due to the short maturity of these instruments.

• Loans receivable: We estimate the fair value of loans receivable by discounting future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The inputs used to measure the fair value of our loans receivable are level two and level three inputs. Additionally, we determine the valuation allowance for losses on loans receivable based on level three inputs.

• Marketable debt securities: We estimate the fair value of marketable debt securities using quoted prices for similar assets or liabilities in active markets that we have the ability to access. The inputs used to measure the fair value of our marketable debt securities are level two inputs.

• Derivative instruments: With the assistance of a third party, we estimate the fair value of our derivative instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, using level two inputs. We determine the fair value of interest rate caps using forward yield curves and other relevant information. We estimate the fair value of interest rate swaps using alternative financing rates derived from market-based financing rates, forward yield curves and discount rates. We determine the fair value of foreign currency forward contracts by estimating the future values of the two currency tranches using forward exchange rates that are based on traded forward points and calculating a present value of the net amount using a discount factor based on observable traded interest rates.

• Senior notes payable and other debt: We estimate the fair value of borrowings by discounting the future cash flows using current interest rates at which we could make similar borrowings. The inputs used to measure the fair value of our senior notes payable and other debt are level two inputs.

• Contingent consideration: We estimate the fair value of contingent consideration using probability assessments of expected future cash flows over the period in which the obligation is expected to be settled, and by applying a discount rate that appropriately captures a market participant’s view of the risk associated with the obligation. The inputs we use to determine the fair value of contingent consideration are considered level three inputs.

• Redeemable OP unitholder interests: We estimate the fair value of redeemable OP unitholder interests based on the closing price of our common stock, as the OP Units may be redeemed, at the election of the holder, for cash or, at our option, 0.7866 shares of our common stock, subject to adjustment in certain circumstances. The inputs used to measure the fair value of redeemable OP unitholder interests are level two inputs.

Recently Issued or Adopted Accounting Standards

In September 2011, the FASB issued Accounting Standards Update (“ASU”) 2011-08, Testing Goodwill for Impairment (“ASU 2011-08”), which permits companies to first assess qualitative factors to determine the likelihood that the fair value of a reporting unit is less than its carrying amount, before performing the current two-step analysis. If a company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the company must proceed with the two-step approach to evaluating impairment. The provisions of ASU 2011-08 will be effective for us beginning with the first quarter of 2012, but we do not expect ASU 2011-08 to have a significant impact on our Consolidated Financial Statements. Also, on January 1, 2011, we adopted ASU 2010-28, When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts (“ASU 2010-28”). ASU 2010-28 states that if a reporting unit has a carrying amount that is equal to or less than zero and there are qualitative factors that indicate it is more likely than not that a goodwill impairment exists, Step 2 of the goodwill impairment test must be performed. The adoption of ASU 2010-28 did not impact our Consolidated Financial Statements.

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In June 2011, the FASB issued ASU 2011-05, Presentation of Comprehensive Income (“ASU 2011-05”), which amends current guidance found in ASC Topic 220, Comprehensive Income. ASU 2011-05 requires entities to present comprehensive income in either: (i) one continuous financial statement or (ii) two separate but consecutive statements that display net income and the components of other comprehensive income. Totals and individual components of both net income and other comprehensive income must be included in either presentation. The provisions of ASU 2011-05 will be effective for us beginning with the first quarter of 2012.

On January 1, 2011, we adopted ASU 2010-29, Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations (“ASU 2010-29”), affecting public entities who enter into business combinations that are material on an individual or aggregate basis. ASU 2010-29 specifies that a public entity presenting comparative financial statements should disclose revenues and earnings of the combined entity as though the business combination(s) that occurred during the year had occurred at the beginning of the prior annual reporting period when preparing the pro forma financial information for both the current and prior reporting periods. This guidance, which is effective for business combinations consummated in reporting periods beginning after December 15, 2010, also requires that pro forma disclosures be accompanied by a narrative description regarding the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination(s) included in reported pro forma revenues and earnings. We have presented supplementary pro forma information related to our acquisition of substantially all of the real estate assets and working capital of Atria Senior Living Group, Inc. (together with its affiliates, “Atria Senior Living”) in May 2011 and our acquisition of NHP in July 2011 in “Note 4—Acquisitions of Real Estate Property.”

In January 2010, the FASB issued ASU 2010-06, Improving Disclosures about Fair Value Measurements (“ASU 2010-06”), which expands required disclosures related to an entity’s fair value measurements. Certain provisions of ASU 2010-06 are effective for interim and annual reporting periods beginning after December 15, 2009, and we adopted those provisions as of January 1, 2010. The remaining provisions, which are effective for interim and annual reporting periods beginning after December 15, 2010, require additional disclosures related to purchases, sales, issuances and settlements in an entity’s reconciliation of recurring level three investments. We adopted those provisions of ASU 2010-06 as of January 1, 2011. The adoption of ASU 2010-06 did not impact our Consolidated Financial Statements.

NOTE 3 — CONCENTRATION OF CREDIT RISK

As of September 30, 2011, Atria, Sunrise, Brookdale Senior Living and Kindred managed or operated approximately 18.7%, 14.4%, 13.0% and 5.0%, respectively, of our properties based on their gross book value. Also, as of September 30, 2011, seniors housing communities constituted approximately 66.2% of our real estate portfolio based on gross book value, with skilled nursing facilities, hospitals, MOBs and other healthcare assets collectively comprising the remaining 33.8%. Our properties were located in 46 states, the District of Columbia and two Canadian provinces as of September 30, 2011, with properties in only one state (California) accounting for more than 10% of our total revenues or net operating income (“NOI”, which is defined as total revenues, excluding interest and other income, less property-level operating expenses and medical office building services costs) for the three months then ended.

Triple-Net Leased Properties

For the three months ended September 30, 2011 and 2010, approximately 11.3% and 23.5%, respectively, of our total revenues and 18.3% and 34.8%, respectively, of our total NOI (including amounts in discontinued operations) were derived from our four Kindred Master Leases. For the same periods, approximately 8.1% and 11.3%, respectively, of our total revenues and 13.1% and 16.8%, respectively, of our total NOI (including amounts in discontinued operations) were derived from our lease agreements with Brookdale Senior Living. Each of the Kindred Master Leases and our leases with Brookdale Senior Living is a triple-net lease pursuant to which the tenant is required to pay all property-related expenses and to comply with the terms of the mortgage financing documents, if any, affecting the properties.

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Because the properties we lease to Kindred and Brookdale Senior Living account for a significant portion of our total revenues and NOI, Kindred’s and Brookdale Senior Living’s financial condition and ability and willingness to satisfy their obligations under their respective leases and other agreements with us, and their willingness to renew those leases upon expiration of the terms thereof, have a notable impact on our results of operations and ability to service our indebtedness and to make distributions to our stockholders. We cannot assure you that either Kindred or Brookdale Senior Living will have sufficient assets, income and access to financing to enable it to satisfy its obligations, and any inability or unwillingness on its part to do so could have a material adverse effect on our business, financial condition, results of operations and liquidity, on our ability to service our indebtedness and other obligations and on our ability to make distributions to our stockholders, as required for us to continue to qualify as a REIT (a “Material Adverse Effect”). We also cannot assure you that either Kindred or Brookdale Senior Living will elect to renew its leases with us upon expiration of the initial base terms or any renewal terms thereof or that, if some or all of those leases are not renewed, we will be able to reposition the affected properties on a timely basis or on the same or better terms, if at all.

The properties we lease to Kindred pursuant to the Kindred Master Leases are grouped into bundles containing a varying number of properties. All properties within a single bundle have the same primary lease term of ten to fifteen years from May 1, 1998 and, provided certain conditions are satisfied, each bundle is subject to three five-year renewal terms at the tenant’s option. The current lease term for ten bundles covering a total of 89 triple-net properties (the “Renewal Assets”) leased to Kindred will expire on April 13, 2013 unless Kindred provides us with renewal notices with respect to one or more of those bundles on or before April 30, 2012. The ten bundles expiring in 2013 each contain six or more properties, including at least one hospital, and collectively represent $122.8 million of annual base rent from May 1, 2011 through April 30, 2012. Kindred is required to continue to perform all of its obligations under the applicable lease for the properties within any bundle that is not renewed until expiration of the term on April 30, 2013, including without limitation payment of all rental amounts. Therefore, as to any bundles for which we do not receive a renewal notice, we will have at least one year to arrange for the repositioning of the applicable properties with new operators. Moreover, we own or have the rights to all licenses and certificates of need at the properties, and Kindred has extensive and detailed obligations to cooperate and ensure an orderly transition of the properties to another operator. While we believe that aggregate current rents for the Renewal Assets approximate current market rents, we cannot assure you that Kindred will elect to renew any or all of the bundles comprising the Renewal Assets or, if Kindred does not renew one or more of such bundles that we will be able to reposition the affected properties on a timely basis or on the same or better terms, if at all.

Six of the ten bundles up for renewal in 2013, containing 53 assets and representing $66 million of annual base rent, are in the second five-year renewal period and, therefore, we have a unilateral bundle-by-bundle option to initiate a fair market rental reset process on any of these six bundles that may be renewed by Kindred. If we elect to initiate the fair market rental reset process for any of these six renewal bundles, the renewal rent will be the higher of contract rent and fair market rent determined by an appraisal process set forth in the applicable Kindred Master Lease. In certain cases following initiation by us of a fair market rental reset process respecting a renewal bundle, Kindred may have the right to revoke its renewal of that particular bundle.

The determination of the market rent, whether on re-leasing or under the reset process, is dependent on and may be influenced by a variety of factors and is highly speculative, and there can be no assurances regarding what market rent may be for any of the Renewal Assets.

Senior Living Operations

As of September 30, 2011, Sunrise and Atria, collectively, provided comprehensive property management and accounting services with respect to 196 of our seniors housing communities for which we pay an annual management fee pursuant to long-term management agreements. Each management agreement with Sunrise has a term of 30 years, and each management agreement with Atria has a term of ten years, subject to successive automatic ten-year renewal periods. While Sunrise and Atria do not lease properties from us and, therefore, we are not directly exposed to credit risk with respect to those entities, any inability by Sunrise or Atria to efficiently and effectively manage our properties or to provide timely and accurate accounting information with respect thereto could have a Material Adverse Effect on us. Although we have various rights as the property owner under our management agreements, we rely on Sunrise’s and Atria’s personnel, good faith, expertise, historical performance, technical resources and information systems, proprietary information and judgment to manage our seniors housing communities efficiently and effectively. We also rely on Sunrise and Atria to set resident fees and otherwise operate those properties in compliance with our management agreements. Sunrise’s or Atria’s inability or unwillingness to satisfy its obligations under our management agreements, changes in Sunrise’s or Atria’s senior management or any adverse developments in Sunrise’s or Atria’s business and affairs or financial condition could have a Material Adverse Effect on us.

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Kindred, Brookdale Senior Living, Sunrise and Atria Information

Each of Kindred, Brookdale Senior Living and Sunrise is subject to the reporting requirements of the SEC and is required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information. The information related to Kindred, Brookdale Senior Living and Sunrise contained or referred to in this Quarterly Report on Form 10-Q is derived from filings made by Kindred, Brookdale Senior Living or Sunrise, as the case may be, with the SEC or other publicly available information, or has been provided to us by Kindred, Brookdale Senior Living or Sunrise. We have not verified this information either through an independent investigation or by reviewing Kindred’s, Brookdale Senior Living’s or Sunrise’s public filings. We have no reason to believe that this information is inaccurate in any material respect, but we cannot assure you that all of this information is accurate. Kindred’s, Brookdale Senior Living’s and Sunrise’s filings with the SEC can be found at the SEC’s website at www.sec.gov. We are providing this data for informational purposes only, and you are encouraged to obtain Kindred’s, Brookdale Senior Living’s and Sunrise’s publicly available filings from the SEC.

Atria is not subject to the reporting requirements of the SEC. The information related to Atria contained or referred to within this Quarterly Report on Form 10-Q has been provided to us by Atria. We have not verified this information through an independent investigation. We have no reason to believe that this information is inaccurate in any material respect, but we cannot assure you that all of this information is accurate.

NOTE 4 — ACQUISITIONS OF REAL ESTATE PROPERTY

We engage in acquisition activity primarily to invest in additional seniors housing and healthcare properties and achieve an expected yield on investment, to grow and diversify our portfolio and revenue base and to reduce our dependence on any single operator, geographic area, asset type or revenue source.

Atria Senior Living Acquisition

On May 12, 2011, we acquired substantially all of the real estate assets and working capital of privately-owned Atria Senior Living. We funded a portion of the purchase price through the issuance of 24.96 million shares of our common stock (which shares had a total value of $1.38 billion based on the May 12, 2011 closing price of our common stock of $55.33 per share). Subsequent to September 30, 2011, we cancelled 83,441 shares issued to the sellers for a working capital adjustment in accordance with the purchase agreement. As a result of the transaction, we added to our senior living operating portfolio 117 private pay seniors housing communities and one development land parcel located primarily in affluent coastal markets such as the New York metropolitan area, New England and California. Prior to the closing, Atria Senior Living spun off its management operations to a newly formed entity, Atria, which continues to operate the acquired assets under long-term management agreements with us. For the three months ended September 30, 2011 and for the period from May 12, 2011 through September 30, 2011, revenues attributable to the acquired assets were $157.1 million and $242.8 million, respectively, and NOI attributable to the acquired assets was $47.5 million and $73.7 million, respectively.

We are accounting for the Atria Senior Living acquisition under the acquisition method in accordance with ASC Topic 805, Business Combinations (“ASC 805”), and our initial accounting for this acquisition is essentially complete. The following table summarizes the acquisition date fair values of the assets acquired and liabilities assumed, which we determined using level two and level three inputs (in thousands):

Land and improvements	$	342,330
Buildings and improvements		2,878,807
Acquired lease intangibles		160,340
Other assets		213,325
Total assets acquired		3,594,802
Notes payable and other debt		1,629,212
Deferred tax liability		43,889
Other liabilities		203,082
Total liabilities assumed		1,876,183
Net assets acquired		1,718,619
Cash acquired		77,718
Equity issued		1,376,437
Total cash used	$	264,464

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The allocation of fair values of the assets acquired and liabilities assumed has changed and is subject to further adjustment from the allocation reported in “Note 4—Acquisitions of Real Estate Property” of the Notes to Consolidated Financial Statements included in Part I of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2011, filed with the SEC on August 5, 2011, due primarily to reclassification adjustments for presentation, adjustments to our valuation assumptions and final purchase price settlement with the sellers in accordance with the terms of the acquisition agreement. The changes to our valuation assumptions were based on more accurate information concerning the subject assets and liabilities. None of these changes had a material impact on our Consolidated Financial Statements.

Included in other assets is $79.2 million of goodwill, which represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed as of the acquisition date. All of the goodwill was assigned to our senior living operations reportable segment, and we do not expect to deduct any of the goodwill balance for tax purposes.

As of September 30, 2011, we had incurred a total of $52.5 million of acquisition-related costs related to the Atria Senior Living acquisition, all of which were expensed as incurred and included in merger-related expenses and deal costs on our Consolidated Statements of Income for the applicable periods. For the three and nine months ended September 30, 2011, we expensed $1.5 million and $48.2 million, respectively, of acquisition-related costs related to the Atria Senior Living acquisition.

As partial consideration for the Atria Senior Living acquisition, the sellers received the right to earn additional amounts (“contingent consideration”) based upon the achievement of certain performance metrics, including the future operating results of the acquired assets, and other factors. The contingent consideration, if any, will be payable to the sellers following the applicable measurement date for the period ending December 31, 2014 or December 31, 2015, at the election of the sellers. We cannot determine the actual amount of contingent consideration, if any, that may become due to the sellers because it is dependent on various factors, such as the future performance of the acquired assets and our equity multiple, which are subject to many risks and uncertainties beyond our control. We are also unable to estimate a range of potential outcomes for the same reason. We estimated the fair value of contingent consideration as of the acquisition date and as of September 30, 2011 using probability assessments of expected future cash flows over the period in which the obligation is expected to be settled and applying a discount rate that appropriately captures a market participant’s view of the risk associated with the obligation. This contingent consideration liability is carried on our Consolidated Balance Sheets (in accounts payable and other liabilities) as of September 30, 2011 at its fair value, and we record any changes in fair value in earnings on our Consolidated Statements of Income. As of both September 30, 2011 and the acquisition date, the estimated fair value of contingent consideration was $44.2 million.

NHP Acquisition

On July 1, 2011, we acquired NHP in a stock-for-stock transaction. Pursuant to the terms and subject to the conditions set forth in the agreement and plan of merger dated as of February 27, 2011, at the effective time of the merger, each outstanding share of NHP common stock (other than shares owned by us or any of our subsidiaries or any wholly owned subsidiary of NHP) was converted into the right to receive 0.7866 shares of our common stock, with cash paid in lieu of fractional shares. In connection with the acquisition, we paid $105 million at closing to repay amounts then outstanding and terminated the commitments under NHP’s revolving credit facility. The NHP acquisition added 643 seniors housing and healthcare properties to our portfolio (including properties that are owned through joint ventures). For both the three and nine months ended September 30, 2011, revenues attributable to the acquired assets were $134.8 million and NOI attributable to the acquired assets was $122.9 million.

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We are accounting for the NHP acquisition under the acquisition method in accordance with ASC 805, and we have completed our initial accounting for this acquisition, which is subject to further adjustment. The following table summarizes the acquisition date fair values of the assets acquired and liabilities assumed, which we determined using level two and level three inputs (in thousands):

Land and improvements	$	687,142
Buildings and improvements		6,414,258
Acquired lease intangibles		515,535
Other assets		701,743
Total assets acquired		8,318,678
Notes payable and other debt		1,879,014
Other liabilities		789,040
Total liabilities assumed		2,668,054
Redeemable OP unitholder interests assumed		100,429
Noncontrolling interest assumed		83,702
Net assets acquired		5,466,493
Cash acquired		29,202
Equity issued		5,361,493
Total cash used	$	75,798

Included in other assets is $189.6 million of goodwill, which represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed as of the acquisition date. We have allocated $129.4 million and $60.2 million of the goodwill balance to our triple-net leased properties and operating assets, respectively. We do not expect to deduct any of the goodwill balance for tax purposes.

As of September 30, 2011, we had incurred a total of $54.8 million of acquisition-related costs related to the NHP acquisition, all of which we expensed as incurred and included in merger-related expenses and deal costs on our Consolidated Statements of Income for the applicable periods. For the three and nine months ended September 30, 2011, we expensed $42.5 million and $54.8 million, respectively, of acquisition-related costs related to the NHP acquisition.

Other 2011 Acquisitions

In August 2011, we purchased one seniors housing community for a purchase price of $3.8 million. In October 2011, we purchased two MOBs and two seniors housing communities (one of which is being managed by Atria) for approximately $150.3 million, including the assumption of $37.7 million in debt.

Lillibridge Acquisition

On July 1, 2010, we completed the acquisition of businesses owned and operated by Lillibridge and its related entities and their real estate interests in 96 MOBs and ambulatory facilities for approximately $381 million, including the assumption of $79.5 million of mortgage debt.

As a result of the Lillibridge acquisition, we acquired: a 100% interest in Lillibridge’s property management, leasing, marketing, facility development, and advisory services business; a 100% interest in 38 MOBs; a 20% joint venture interest in 24 MOBs; and a 5% joint venture interest in 34 MOBs. We are the managing member of these joint ventures and the property manager for the joint venture properties. Two institutional third parties hold the controlling interests in these joint ventures, and we have a right of first offer on those interests. We funded the acquisition with cash on hand, borrowings under our unsecured revolving credit facilities and the assumption of mortgage debt. In connection with the acquisition, $132.7 million of mortgage debt was repaid.

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Other 2010 Acquisitions

In December 2010, we acquired Sunrise’s noncontrolling interests in 58 of our seniors housing communities currently managed by Sunrise for a total valuation of approximately $186 million, including the assumption of Sunrise’s share of mortgage debt totaling approximately $144 million. The noncontrolling interests acquired represented between 15% and 25% ownership interests in the communities, and we now own 100% of all 79 of our Sunrise-managed seniors housing communities. We recorded the difference between the consideration paid and the noncontrolling interest balance as a component of equity in capital in excess of par value on our Consolidated Balance Sheets.

Also in December 2010, we purchased five MOBs for a purchase price of $36.6 million.

Unaudited Pro Forma

The following table illustrates the effect on net income and earnings per share as if we had consummated the Atria Senior Living and NHP acquisitions as of January 1, 2010:

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Revenues	$	565,424	$	556,779	$	1,698,376	$	1,625,552
Income from continuing operations attributable to common stockholders		183,517		90,891		399,249		280,216
Discontinued operations		—		542		—		7,139
Net income attributable to common stockholders		183,517		91,433		399,249		287,355
Earnings per common share:
Basic:
Income from continuing operations attributable to common stockholders	$	0.64	$	0.32	$	1.39	$	1.00
Discontinued operations		—		0.00		—		0.02
Net income attributable to common stockholders	$	0.64	$	0.32	$	1.39	$	1.02
Diluted:
Income from continuing operations attributable to common stockholders	$	0.63	$	0.32	$	1.38	$	0.99
Discontinued operations		—		0.00		—		0.03
Net income attributable to common stockholders	$	0.63	$	0.32	$	1.38	$	1.02
Weighted average shares used in computing earnings per common share:
Basic		287,365		281,439		286,647		281,374
Diluted		290,794		282,749		289,027		282,261

Acquisition-related costs related to the Atria Senior Living and NHP acquisitions are not expected to have a continuing significant impact and therefore have been excluded from these pro forma results. The pro forma results also do not include the impact of any synergies or lower borrowing costs that may be achieved as a result of the acquisitions or any strategies that management may consider in order to continue to efficiently manage our operations, nor do they give pro forma effect to any other acquisitions, dispositions or capital markets transactions that we completed during the periods presented. These pro forma results are not necessarily indicative of the operating results that would have been obtained had the Atria Senior Living and NHP acquisitions occurred at the beginning of the periods presented, nor are they necessarily indicative of future operating results.

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NOTE 5 — LOANS RECEIVABLE

As of September 30, 2011 and December 31, 2010, we had $367.6 million and $149.3 million, respectively, of net loans receivable relating to seniors housing and healthcare companies or properties.

In November 2011, we received proceeds of $3.0 million in final repayment of two secured loans receivable.

In October 2011, we received proceeds of $6.4 million in final repayment of a first mortgage loan.

In August 2011, we received proceeds of $5.5 million in final repayment of a secured mortgage loan.

In connection with the NHP acquisition, on July 1, 2011, we acquired (i) mortgage loans receivable with an initial aggregate fair value of approximately $270 million that are secured by 53 seniors housing and healthcare properties and (ii) other loans receivable with an initial aggregate fair value of approximately $60 million that are unsecured.

In June 2011, we made a first mortgage loan in the aggregate principal amount of $12.9 million, bearing interest at a fixed rate of 9.0% per annum and maturing in 2016.

In May 2011, we made a senior unsecured term loan to NHP in the aggregate principal amount of $600.0 million, bearing interest at a fixed rate of 5.0% per annum and maturing in 2021. As of our acquisition date of NHP, this investment and related interest were eliminated in consolidation.

In April 2011, we received proceeds of $112.4 million in final repayment of a first mortgage loan and recognized a gain of $3.3 million (included in income from loans and investments on our Consolidated Statements of Income) in connection with this repayment in the second quarter of 2011.

In March 2011, we received proceeds of $19.9 million in final repayment of a first mortgage loan and recognized a gain of $0.8 million (included in income from loans and investments on our Consolidated Statements of Income) in connection with this repayment in the first quarter of 2011.

NOTE 6 — INVESTMENTS IN UNCONSOLIDATED ENTITIES

We report investments in unconsolidated entities, which we acquired in connection with our Lillibridge and NHP acquisitions, over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. We serve as the managing member of each unconsolidated entity and provide various services in exchange for fees and reimbursements. Our joint venture partners have significant participating rights, and, therefore, we are not required to consolidate these entities. Additionally, these entities are viable entities controlled by equity holders with sufficient capital and, therefore, are not considered variable interest entities. At September 30, 2011 and December 31, 2010, we owned interests (ranging between 5% and 25%) in 92 properties and interests (ranging between 5% and 20%) in 58 properties, respectively, that were accounted for under the equity method. Our net investment in these properties as of September 30, 2011 and December 31, 2010 was $119.3 million and $15.3 million, respectively. For the three months ended September 30, 2011 and 2010, we recorded income from unconsolidated entities of $0.2 million and a loss from unconsolidated entities of $0.4 million, respectively. For the nine months ended September 30, 2011 and 2010, we recorded a loss from unconsolidated entities of $0.1 million and $0.4 million, respectively.

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NOTE 7 — INTANGIBLES

The following is a summary of our intangibles as of September 30, 2011 and December 31, 2010:

	September 30,			December 31,
	2011			2010
	(Dollars in thousands)
Intangible assets:
Above market lease intangibles	$	203,460		$	13,232
In-place and other lease intangibles		618,153			133,582
Other intangibles		16,453			13,649
Accumulated amortization		(152,486	)		(100,808	)
Goodwill		288,196			19,901
Net intangible assets	$	973,776		$	79,556
Remaining weighted average amortization period of lease-related intangible assets in years		19.6			18.5
Intangible liabilities:
Below market lease intangibles	$	486,228		$	22,398
Other lease intangibles		157,971			—
Accumulated amortization		(26,425	)		(12,495	)
Net intangible liabilities	$	617,774		$	9,903
Remaining weighted average amortization period of lease-related intangible liabilities in years		18.5			6.9

Above market lease intangibles and in-place and other lease intangibles are included in acquired lease intangibles within real estate investments on our Consolidated Balance Sheets. Other intangibles (including non-compete agreements and trade names/trademarks) and goodwill are included in other assets on our Consolidated Balance Sheets. Below market lease and other lease intangibles are included in accounts payable and other liabilities on our Consolidated Balance Sheets. For the three months ended September 30, 2011 and 2010, our net amortization expense related to these intangibles was $23.9 million and $2.3 million, respectively. For the nine months ended September 30, 2011 and 2010, our net amortization expense related to these intangibles was $40.0 million and $5.7 million, respectively. The estimated net amortization expense related to these intangibles for each of the next five years is as follows: 2012 — $76.1 million; 2013 — $18.4 million; 2014 — $15.0 million; 2015 — $8.9 million; and 2016 — $7.0 million.

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NOTE 8 — SENIOR NOTES PAYABLE AND OTHER DEBT

The following is a summary of our senior notes payable and other debt as of September 30, 2011 and December 31, 2010:

	September 30,			December 31,
	2011			2010
	(In thousands)
Unsecured revolving credit facilities	$	474,000		$	40,000
37/8% Convertible Senior Notes due 2011		230,000			230,000
9% Senior Notes due 2012		82,433			82,433
81/4% Senior Notes due 2012		72,950			—
Unsecured term loan due 2012		250,000			—
Unsecured term loan due 2013		200,000			200,000
6.25% Senior Notes due 2013		269,850			—
3.125% Senior Notes due 2015		400,000			400,000
6% Senior Notes due 2015		234,420			—
61/2% Senior Notes due 2016		200,000			400,000
63/4% Senior Notes due 2017		225,000			225,000
4.750% Senior Notes due 2021		700,000			—
6.90% Senior Notes due 2037		52,400			—
6.59% Senior Notes due 2038		22,973			—
Mortgage loans and other		2,651,830			1,349,521
Total		6,065,856			2,926,954
Capital lease obligations		143,119			—
Unamortized fair value adjustment		145,647			11,790
Unamortized commission fees and discounts		(41,481	)		(38,700	)
Senior notes payable and other debt	$	6,313,141		$	2,900,044

As of September 30, 2011, our joint venture partners’ share of total debt was $45.9 million with respect to seven properties owned through consolidated joint ventures. As of December 31, 2010, our joint venture partners’ share of total debt was $4.8 million with respect to three properties owned through consolidated joint ventures. Total debt does not include our portion of debt related to our investments in unconsolidated entities, which was $131.7 million and $45.9 million at September 30, 2011 and December 31, 2010, respectively.

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As of September 30, 2011, our indebtedness (excluding capital lease obligations) had the following maturities:

			Unsecured
	Principal Amount		Revolving Credit		Scheduled Periodic
	Due at Maturity		Facilities (1)		Amortization		Total Maturities
	(In thousands)
2011	$	230,700	$	—	$	12,798	$	243,498
2012 (2)		517,913		474,000		50,347		1,042,260
2013		872,623		—		44,110		916,733
2014		220,891		—		39,998		260,889
2015		835,792		—		32,503		868,295
Thereafter (3)		2,539,451		—		194,730		2,734,181
Total maturities	$	5,217,370	$	474,000	$	374,486	$	6,065,856

(1)	At September 30, 2011, we had $57.5 million of unrestricted cash and cash equivalents, for $416.5 million of net borrowings outstanding under our unsecured revolving credit facilities. On October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new $2.0 billion unsecured revolving credit facility due 2015, subject to a one-year extension. See “Unsecured Revolving Credit Facilities and Term Loans” below.
(2)	Includes $250.0 million of borrowings outstanding under an $800.0 million senior unsecured term loan previously extended to NHP, which was repaid in full subsequent to September 30, 2011. See “Unsecured Revolving Credit Facilities and Term Loans” below.
(3)	Includes $52.4 million aggregate principal amount of 6.90% Senior Notes due 2037 of NHP, which are subject to repurchase, at the option of the holders, on October 1 of each of 2012, 2017 and 2027, and $23.0 million aggregate principal amount of 6.59% Senior Notes due 2038 of NHP, which are subject to repurchase, at the option of the holders, on July 7 of each of 2013, 2018, 2023 and 2028.

Unsecured Revolving Credit Facilities and Term Loans

As of September 30, 2011, we had $1.0 billion of aggregate borrowing capacity under our then-existing unsecured revolving credit facilities, all of which was scheduled to mature on April 26, 2012. Borrowings under our unsecured revolving credit facilities bore interest at a fluctuating rate per annum (based on U.S. or Canadian LIBOR, the Canadian Bankers’ Acceptance rate, or the U.S. or Canadian Prime rate), plus an applicable percentage based on our consolidated leverage. At September 30, 2011, the applicable percentage was 2.80%. Our unsecured revolving credit facilities also had a 20 basis point facility fee. At September 30, 2011, we had $474.0 million of borrowings outstanding, $8.3 million of outstanding letters of credit and $517.7 million of available borrowing capacity under our unsecured revolving credit facilities, and we were in compliance with all covenants under our unsecured revolving credit facilities.

Effective October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new unsecured revolving credit facility. Our new unsecured revolving credit facility provides us with $2.0 billion of aggregate borrowing capacity, which may be increased, at our option subject to the satisfaction of certain conditions, to up to $2.5 billion, and includes sublimits of (i) up to $200 million for letters of credit, (ii) up to $200 million for swingline loans, (iii) up to $250 million for loans in certain alternative currencies, and (iv) up to 50% of the facility for certain negotiated rate loans. Borrowings under our new unsecured revolving credit facility bear interest at a fluctuating rate per annum (based on the applicable LIBOR for Eurocurrency rate loans and the higher of (i) the federal funds rate plus 0.50%, (ii) the administrative agent’s prime rate and (iii) the applicable LIBOR plus 1.0% for base rate loans, plus, in each case, an applicable percentage based on our senior unsecured long-term debt ratings). At October 18, 2011, the applicable percentage was 1.25% for Eurocurrency rate loans and 0.25% for base rate loans. We also pay a facility fee ranging from 15 to 45 basis points per annum (based on our senior unsecured long-term debt ratings) on the aggregate revolving commitments under our new unsecured revolving credit facility. At October 18, 2011, the facility fee was 25 basis points. Borrowings under our new unsecured revolving credit facility mature on October 16, 2015, but may be extended, at our option subject to the satisfaction of certain conditions, for an additional period of one year.

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Our new unsecured revolving credit facility imposes certain customary restrictions on us, including restrictions pertaining to: (i) liens; (ii) investments; (iii) the incurrence of additional indebtedness; (iv) mergers, sales of assets and dissolutions; (v) certain dividend, distribution and other payments; (vi) permitted businesses; (vii) transactions with affiliates; (viii) agreements limiting certain liens; and (ix) the maintenance of certain consolidated total leverage, secured debt leverage, unsecured leverage and fixed charge coverage ratios and minimum consolidated adjusted net worth, and contains customary events of default.

As of November 2, 2011, we had $727 million of borrowings outstanding, $8 million of outstanding letters of credit and $1.26 billion of available borrowing capacity under our new unsecured revolving credit facility.

In connection with the NHP acquisition, on July 1, 2011, we acquired additional liquidity from an $800.0 million senior unsecured term loan previously extended to NHP. At our option, borrowings under the term loan, which are available from time to time on a non-revolving basis, bear interest at the applicable LIBOR plus 1.50% (1.69% at September 30, 2011) or the “Alternate Base Rate” plus 0.50% (we had no base rate borrowings outstanding at September 30, 2011). We pay a facility fee of 10 basis points per annum on the unused commitments under the term loan agreement. Borrowings under the term loan mature on June 1, 2012. At September 30, 2011, we had $250.0 million of borrowings outstanding and $550.0 million of available borrowing capacity under the term loan, and we were in compliance with all covenants under the term loan. On November 1, 2011, we repaid the $250.0 million of borrowings outstanding and continue to have $550.0 million of available borrowing capacity under the term loan.

Mortgages

We assumed mortgage debt of $1.2 billion and $0.4 billion, respectively, in connection with our Atria Senior Living and NHP acquisitions.

In February 2011, we repaid in full mortgage loans outstanding in the aggregate principal amount of $307.2 million and recognized a loss on extinguishment of debt of $16.5 million in connection with this repayment in the first quarter of 2011.

Senior Notes

In May 2011, we issued and sold $700.0 million aggregate principal amount of 4.750% senior notes due 2021, at a public offering price equal to 99.132% of par for total proceeds of $693.9 million, before the underwriting discount and expenses.

In July 2011, we redeemed $200.0 million principal amount of our outstanding 6¹/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $8.7 million during the third quarter of 2011.

As a result of the NHP acquisition, we assumed $991.6 million aggregate principal amount of outstanding unsecured senior notes of NHP. On July 15, 2011, we repaid in full, at par, $339.0 million principal amount then outstanding of NHP’s 6.50% senior notes due 2011 upon maturity. The remaining NHP senior notes outstanding bear interest at fixed rates ranging from 6.00% to 8.25% per annum and have maturity dates ranging from July 1, 2012 to July 7, 2038, subject in certain cases to earlier repayment at the option of the holders.

Capital Leases

As of September 30, 2011, we leased eight seniors housing communities pursuant to arrangements that we assumed in connection with the Atria Senior Living acquisition which are accounted for as capital leases. Rent under each capital lease is subject to increase based upon changes in the Consumer Price Index or gross revenues attributable to the property, subject to certain limits, as defined in the applicable lease agreement. Pursuant to each capital lease agreement, we have a bargain option to purchase the leased property and an option to exercise renewal terms.

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Future minimum lease payments required under the capital lease agreements, including amounts that would be due under purchase options, as of September 30, 2011 are as follows (in thousands):

2011	$	2,343
2012		9,446
2013		9,573
2014		9,699
2015		9,826
Thereafter		172,553
Total minimum lease payments		213,440
Less: Amount related to interest		(70,321	)
	$	143,119

Net assets held under capital leases are included in net real estate investments on our Consolidated Balance Sheets and totaled $226.9 million and $0 as of September 30, 2011 and December 31, 2010, respectively.

NOTE 9 — FAIR VALUES OF FINANCIAL INSTRUMENTS

As of September 30, 2011 and December 31, 2010, the carrying amounts and fair values of our financial instruments were as follows:

	September 30, 2011				December 31, 2010
	Carrying				Carrying
	Amount		Fair Value		Amount		Fair Value
	(In thousands)
Assets:
Cash and cash equivalents	$	57,482	$	57,482	$	21,812	$	21,812
Secured loans receivable, net		302,264		302,393		149,263		155,377
Derivative instruments		8,536		8,536		99		99
Marketable debt securities		42,788		42,788		66,675		66,675
Unsecured loans receivable, net		65,384		65,384		—		—
Liabilities:
Senior notes payable and other debt, gross		6,065,856		6,415,640		2,926,954		3,055,435
Derivative instruments		24,537		24,537		3,722		3,722
Contingent consideration liabilities		56,218		56,218		—		—
Redeemable OP unitholder interests		92,817		92,817		—		—

Fair value estimates are subjective in nature and depend upon several important assumptions, including estimates of future cash flows, risks, discount rates and relevant comparable market information associated with each financial instrument. The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the estimates presented above are not necessarily indicative of the amounts we would realize in a current market exchange.

At September 30, 2011, we held corporate marketable debt securities, classified as available-for-sale and included within other assets on our Consolidated Balance Sheets, having an aggregate amortized cost basis and fair value of $41.0 million and $42.8 million, respectively. At December 31, 2010, our marketable debt securities had an aggregate amortized cost basis and fair value of $61.9 million and $66.7 million, respectively. The contractual maturities of our marketable debt securities range from October 1, 2012 to April 15, 2016. In the first quarter of 2011, we sold certain marketable debt securities and received proceeds of approximately $23.1 million. We recognized aggregate gains from these sales of approximately $1.8 million (included in income from loans and investments on our Consolidated Statements of Income) during the first quarter of 2011.

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NOTE 10 — LITIGATION

Litigation Relating to the Sunrise REIT Acquisition

On May 3, 2007, we filed a lawsuit against HCP, Inc. (“HCP”) in the United States District Court for the Western District of Kentucky (the “District Court”), entitled Ventas, Inc. v. HCP, Inc., Case No. 07-cv-238-JGH. We asserted claims of tortious interference with contract and tortious interference with prospective business advantage. Our complaint alleged that HCP interfered with our purchase agreement to acquire the assets and liabilities of Sunrise Senior Living Real Estate Investment Trust (“Sunrise REIT”) and with the process for unitholder consideration of the purchase agreement. The complaint alleged, among other things, that HCP made certain improper and misleading public statements and/or offers to acquire Sunrise REIT and that HCP’s actions caused us to suffer substantial damages, including, among other things, the payment of materially greater consideration to acquire Sunrise REIT resulting from the substantial increase in the purchase price above the original contract price necessary to obtain unitholder approval and increased costs associated with the delay in closing the acquisition, including increased costs to finance the transaction as a result of the delay.

HCP brought counterclaims against us alleging misrepresentation and negligent misrepresentation by Sunrise REIT related to its sale process, claiming that we were responsible for those actions as successor. HCP sought compensatory and punitive damages. On March 25, 2009, the District Court granted us judgment on the pleadings against all counterclaims brought by HCP and dismissed HCP’s counterclaims with prejudice. Thereafter, the District Court confirmed the dismissal of HCP’s counterclaims.

On July 16, 2009, the District Court denied HCP’s summary judgment motion as to our claim for tortious interference with business advantage, permitting us to present that claim against HCP at trial. The District Court granted HCP’s motion for summary judgment as to our claim for tortious interference with contract and dismissed that claim. The District Court also ruled that we could not seek to recover a portion of our alleged damages.

On September 4, 2009, the jury unanimously held that HCP tortiously interfered with our business expectation to acquire Sunrise REIT at the agreed price by employing significantly wrongful means such as fraudulent misrepresentation, deceit and coercion. The jury awarded us $101.6 million in compensatory damages, which is the full amount of damages the District Court permitted us to seek at trial. The District Court entered judgment on the jury’s verdict on September 8, 2009.

On November 16, 2009, the District Court affirmed the jury’s verdict and denied all of HCP’s post-trial motions, including a motion requesting that the District Court overturn the jury’s verdict and enter judgment for HCP or, in the alternative, award HCP a new trial. The District Court also denied our motion for pre-judgment interest and/or to modify the jury award to increase it to reflect the currency rates in effect on September 8, 2009, the date of entry of the judgment.

On November 17, 2009, HCP appealed the District Court’s judgment to the United States Court of Appeals for the Sixth Circuit (the “Sixth Circuit”). HCP argued that the judgment against it should be vacated and the case remanded for a new trial and/or that judgment should be entered in its favor as a matter of law.

On November 24, 2009, we filed a cross-appeal to the Sixth Circuit. In addition to maintaining the full benefit of our favorable jury verdict, in our cross-appeal, we asserted that we are entitled to substantial monetary relief in addition to the jury verdict, including punitive damages, additional compensatory damages and pre-judgment interest.

On December 11, 2009, HCP posted a $102.8 million letter of credit in our favor to serve as security to stay execution of the jury verdict pending the appellate proceedings.

On May 17, 2011, the Sixth Circuit unanimously affirmed the $101.6 million jury verdict in our favor and ruled that we are entitled to seek punitive damages against HCP for its conduct. The Sixth Circuit also denied our appeal seeking additional compensatory damages and pre-judgment interest. On June 27, 2011, the Sixth Circuit denied HCP’s motion to request a rehearing with respect to its decision.

On July 5, 2011, the Sixth Circuit issued a mandate terminating the appellate proceedings and transferring jurisdiction back to the District Court for the enforcement of the $101.6 million compensatory damages award and the trial for punitive damages. On July 26, 2011, the District Court issued an order scheduling a jury trial on the matter of punitive damages for February 21, 2012.

On August 22, 2011, the District Court ruled that HCP could not further delay enforcement of our $101.6 million compensatory damages award. On August 23, 2011, HCP paid us $102.8 million for the judgment plus certain costs and interest. After accrual of certain unpaid fees and $5.75 million in contingent fees for our outside legal counsel and payment of a $3 million donation to the Ventas Charitable Foundation, we recognized approximately $85 million in net proceeds from the compensatory damages award in our Consolidated Statements of Income.

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On October 25, 2011, HCP filed a petition for certiorari with the U.S. Supreme Court seeking to challenge the Sixth Circuit’s May 17, 2011 decision affirming the compensatory damages award and ordering a trial on punitive damages.

We are vigorously pursuing proceedings in the District Court on the matter of punitive damages. We cannot assure you as to the outcome of HCP’s petition for certiorari to the U.S. Supreme Court, which we believe will not be granted, or the District Court trial on the matter of punitive damages.

Litigation Relating to the NHP Acquisition

In the weeks following the announcement of our acquisition of NHP on February 28, 2011, purported stockholders of NHP filed seven lawsuits against NHP and its directors. Six of these lawsuits also named Ventas, Inc. as a defendant and five named our subsidiary, Needles Acquisition LLC, as a defendant. The purported stockholder plaintiffs commenced these actions in two jurisdictions: the Superior Court of the State of California, Orange County (the “California State Court”); and the Circuit Court for Baltimore City, Maryland (the “Maryland State Court”). All of these actions were brought as putative class actions, and two also purport to assert derivative claims on behalf of NHP. All of these stockholder complaints allege that NHP’s directors breached certain alleged duties to NHP’s stockholders by approving the merger agreement with us, and certain complaints allege that NHP aided and abetted those breaches. Those complaints that name Ventas, Inc. and Needles Acquisition LLC allege that we aided and abetted the purported breaches of certain alleged duties by NHP’s directors. All of the complaints request an injunction of the merger. Certain of the complaints also seek damages.

In the California State Court, the following actions were filed purportedly on behalf of NHP stockholders: on February 28, 2011, a putative class action entitled Palma v. Nationwide Health Properties, Inc., et al.; on March 3, 2011, a putative class action entitled Barker v. Nationwide Health Properties, Inc., et al.; and on March 3, 2011, a putative class action entitled Davis v. Nationwide Health Properties, Inc., et al., which was subsequently amended on March 11, 2011 under the caption Davids v. Nationwide Health Properties, Inc., et al. Each action names NHP and members of the NHP board of directors as defendants. The Barker and Davids actions also name Ventas, Inc. as a defendant, and the Davids action names Needles Acquisition LLC as a defendant. Each complaint alleges, among other things, that NHP’s directors breached certain alleged duties by approving the merger agreement between us and NHP because the proposed transaction purportedly fails to maximize stockholder value and provides the directors personal benefits not shared by NHP stockholders, and the Barker and Davids actions allege that we aided and abetted those purported breaches. Along with other relief, the complaints seek an injunction against the closing of the proposed merger. On April 4, 2011, the defendants demurred and moved to stay the Palma, Barker, and Davids actions in favor of the parallel litigation in the Maryland State Court described below. On April 27, 2011, all three actions were consolidated pursuant to a Stipulation and Proposed Order on Consolidation of Related Actions signed by the parties on March 22, 2011. On May 12, 2011, the California State Court granted the defendants’ motion to stay.

In the Maryland State Court, the following actions were filed purportedly on behalf of NHP stockholders: on March 7, 2011, a putative class action entitled Crowley v. Nationwide Health Properties, Inc., et al.; on March 10, 2011, a putative class action entitled Taylor v. Nationwide Health Properties, Inc., et. al.; on March 17, 2011, a putative class action entitled Haughey Family Trust v. Pasquale, et al.; and on March 31, 2011, a putative class action entitled Rappoport v. Pasquale, et al. All four actions name NHP, its directors, Ventas, Inc. and Needles Acquisition LLC as defendants. All four actions allege, among other things, that NHP’s directors breached certain alleged duties by approving the merger agreement between us and NHP because the proposed transaction purportedly fails to maximize stockholder value and provides certain directors personal benefits not shared by NHP stockholders and that we aided and abetted those purported breaches. In addition to asserting direct claims on behalf of a putative class of NHP shareholders, the Haughey and Rappoport actions purport to bring derivative claims on behalf of NHP, asserting breaches of certain alleged duties by NHP’s directors in connection with their approval of the proposed transaction. All four actions seek to enjoin the proposed merger, and the Taylor action seeks damages.

On March 30, 2011, pursuant to stipulation of the parties, the Maryland State Court entered an order consolidating the Crowley, Taylor and Haughey actions. The Rappoport action was consolidated with the other actions on April 15, 2011.

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On April 1, 2011, pursuant to stipulation of the parties, the Maryland State Court entered an order: (i) certifying a class of NHP shareholders; and (ii) providing for the plaintiffs to file a consolidated amended complaint. The plaintiffs filed a consolidated amended complaint on April 19, 2011, which the defendants moved to dismiss on April 29, 2011. Plaintiffs opposed that motion on May 9, 2011. Plaintiffs moved for expedited discovery on April 19, 2011, and the defendants simultaneously opposed that motion and moved for a protective order staying discovery on April 26, 2011. The Maryland State Court denied plaintiffs’ motion for expedited discovery and granted defendants’ motion for a protective order on May 3, 2011. On May 6, 2011, plaintiffs moved for reconsideration of the Maryland State Court’s grant of the protective order. The Maryland State Court denied the plaintiffs’ motion for reconsideration on May 11, 2011. On May 27, 2011, the Maryland State Court entered an order dismissing the consolidated action with prejudice. Plaintiffs moved for reconsideration of that order on June 6, 2011.

On June 9, 2011, we and NHP agreed on a settlement in principle with the plaintiffs in the consolidated action pending in Maryland State Court, which required us and NHP to make certain supplemental disclosures to stockholders concerning the merger. We and NHP made the supplemental disclosures on June 10, 2011. The settlement is subject to appropriate documentation by the parties and approval by the Maryland State Court.

We believe that each of these actions is without merit.

Proceedings against Tenants, Operators and Managers

From time to time, Kindred, Brookdale Senior Living, Sunrise, Atria and our other tenants, operators and managers are parties to certain legal actions, regulatory investigations and claims arising in the conduct of their business and operations. Even though we generally are not party to these proceedings, the unfavorable resolution of any such actions, investigations or claims could, individually or in the aggregate, materially adversely affect such tenants’, operators’ or managers’ liquidity, financial condition or results of operations and their ability to satisfy their respective obligations to us, which, in turn, could have a Material Adverse Effect on us.

Proceedings Indemnified and Defended by Third Parties

From time to time, we are party to certain legal actions, regulatory investigations and claims against which third parties are contractually obligated to indemnify and defend us and hold us harmless. The tenants of our triple-net leased properties and, in some cases, affiliates of the tenants are required by the terms of their leases and other agreements with us to indemnify, defend and hold us harmless against certain actions, investigations and claims arising in the course of their business and related to the operations of our triple-net leased properties. In addition, third parties from whom we acquired certain of our assets are required by the terms of the related conveyance documents to indemnify, defend and hold us harmless against certain actions, investigations and claims related to the conveyed assets and arising prior to our ownership. In some cases, we hold a portion of the purchase price consideration in escrow as collateral for the indemnification obligations of third parties related to acquired assets. Certain tenants and other obligated third parties are currently defending us in these types of matters. We cannot assure you that our tenants or their affiliates or other obligated third parties will continue to defend us in these matters, that our tenants or their affiliates or other obligated third parties will have sufficient assets, income and access to financing to enable them to satisfy their defense and indemnification obligations to us or that any purchase price consideration held in escrow will be sufficient to satisfy claims for which we are entitled to indemnification. The unfavorable resolution of any such actions, investigations or claims could, individually or in the aggregate, materially adversely affect our tenants’ or other obligated third parties’ liquidity, financial condition or results of operations and their ability to satisfy their respective obligations to us, which, in turn, could have a Material Adverse Effect on us.

Proceedings Arising in Connection with Senior Living and MOB Operations; Other Litigation

From time to time, we are also party to various legal actions, regulatory investigations and claims (some of which may not be insured) arising in connection with our senior living and MOB operations or otherwise in the course of our business. In limited circumstances, the manager of the applicable seniors housing community or MOB may be contractually obligated to indemnify, defend and hold us harmless against such actions, investigations and claims. It is the opinion of management that, except as otherwise set forth in this Note 10, the disposition of any such actions, investigations and claims that are currently pending will not, individually or in the aggregate, have a Material Adverse Effect on us. However, regardless of their merits, these matters may force us to expend significant financial resources. We are unable to predict the ultimate outcome of these actions, investigations and claims, and if management’s assessment of our liability with respect thereto is incorrect, such actions, investigations and claims could have a Material Adverse Effect on us.

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NOTE 11 — INCOME TAXES

We have elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”), commencing with the year ended December 31, 1999. We have also elected for certain of our subsidiaries to be treated as taxable REIT subsidiaries (“TRS” or “TRS entities”), which are subject to federal and state income taxes. Although the TRS entities were not liable for any cash federal income taxes for the nine months ended September 30, 2011, their federal income tax liabilities may increase in future periods as we exhaust net operating loss carryforwards and as our senior living operations and MOB operations reportable segments grow. Such increases could be significant.

Our consolidated provision for income taxes for the three months ended September 30, 2011 and 2010 was a benefit of $13.9 million and an expense of $1.7 million, respectively. These amounts were adjusted by income tax expense of $0 million and $0.6 million, respectively, related to the noncontrolling interest share of net income. Our consolidated provision for income taxes for the nine months ended September 30, 2011 and 2010 was a benefit of $23.3 million and an expense of $2.4 million, respectively. These amounts were adjusted by income tax expense of $0 million and $1.6 million, respectively, related to the noncontrolling interest share of net income. The benefit for the three and nine months ended September 30, 2011 primarily relates to the reversal of certain income tax contingency reserves, including interest, and the deferred tax liabilities established for the Atria Senior Living acquisition. The statute of limitations with respect to our 2007 U.S. federal income tax returns expired in September 2011. We did not recognize any income tax expense as a result of the litigation proceeds that we received in the third quarter of 2011, as no income taxes are payable on these proceeds.

Realization of a deferred tax benefit related to net operating losses is dependent in part upon generating sufficient taxable income in future periods. Our net operating loss carryforwards begin to expire in 2024 with respect to our TRS entities and in 2020 with respect to our other entities.

Each TRS is a tax paying component for purposes of classifying deferred tax assets and liabilities. Net deferred tax liabilities with respect to our TRS entities totaled $274.9 million and $241.3 million at September 30, 2011 and December 31, 2010, respectively, and related primarily to differences between the financial reporting and tax bases of fixed and intangible assets and to net operating losses. This amount includes the initial net deferred tax liability related to the Atria Senior Living acquisition of $43.9 million and adjustments for activity for the period from May 12, 2011 through September 30, 2011.

Generally, we are subject to audit under the statute of limitations by the Internal Revenue Service for the year ended December 31, 2008 and subsequent years and are subject to audit by state taxing authorities for the year ended December 31, 2007 and subsequent years. We are also subject to audit by the Canada Revenue Agency and provincial authorities generally for periods subsequent to 2004 related to entities acquired or formed in connection with our Sunrise REIT acquisition.

NOTE 12 — STOCKHOLDERS’ EQUITY

On July 1, 2011, following approval by our stockholders, we amended our Amended and Restated Certificate of Incorporation, as previously amended, to increase the number of authorized shares of our capital stock to 610,000,000, comprised of 600,000,000 shares of common stock, par value $0.25 per share, and 10,000,000 shares of preferred stock, par value $1.00 per share.

On July 1, 2011, in connection with the NHP acquisition, we issued 99,849,106 shares of our common stock to NHP stockholders and holders of NHP equity awards (which shares had a total value of $5.4 billion based on the July 1, 2011 closing price of our common stock of $53.74 per share). We reserved 2,253,366 additional shares of our common stock for issuance in connection with equity awards and other convertible or exchangeable securities (specifically the OP Units) that we assumed in connection with the NHP acquisition.

On June 20, 2011, in connection with the NHP acquisition, our Board of Directors declared a prorated third quarter dividend on our common stock in the amount of $0.1264 per share, payable in cash to stockholders of record at the close of business on June 30, 2011. The prorated dividend of $23.8 million was paid on July 12, 2011. On August 19, 2011, our Board of Directors declared another prorated third quarter dividend on our common stock in the amount of $0.4486 per share, which was paid in cash on September 30, 2011 to stockholders of record on September 13, 2011. Together, these two prorated amounts equate to our regular quarterly dividend of $0.575 per share and constitute the third quarterly installment of our 2011 dividend.

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On May 12, 2011, as partial consideration for the Atria Senior Living assets, we issued to the sellers in a private placement 24,958,543 shares of our common stock (which shares had a total value of $1.38 billion based on the May 12, 2011 closing price of our common stock of $55.33 per share). On May 19, 2011, we filed a shelf registration statement relating to the resale of those shares by the selling stockholders. Subsequent to September 30, 2011, we cancelled 83,441 shares issued to the sellers for a working capital adjustment in accordance with the purchase agreement.

In February 2011, we completed the sale of 5,563,000 shares of our common stock in an underwritten public offering pursuant to our existing shelf registration statement. We received $300.0 million in aggregate proceeds from the sale, which we used to repay existing mortgage debt and for working capital and other general corporate purposes.

Accumulated Other Comprehensive Income

The following is a summary of our accumulated other comprehensive income as of September 30, 2011 and December 31, 2010:

	September 30,			December 31,
	2011			2010
	(In thousands)
Foreign currency translation	$	18,776		$	23,010
Unrealized gain on marketable debt securities		1,830			4,794
Other		(1,369	)		(936	)
Total accumulated other comprehensive income	$	19,237		$	26,868

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NOTE 13 — EARNINGS PER COMMON SHARE

The following table shows the amounts used in computing basic and diluted earnings per common share:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Numerator for basic and diluted earnings per share:
Income from continuing operations attributable to common stockholders	$	102,885	$	57,356	$	171,545	$	161,445
Discontinued operations		—		542		—		7,139
Net income attributable to common stockholders	$	102,885	$	57,898	$	171,545	$	168,584
Denominator:
Denominator for basic earnings per share — weighted average shares		287,365		156,631		208,470		156,566
Effect of dilutive securities:
Stock options		412		451		458		375
Restricted stock awards		38		95		57		62
OP units		1,868		—		630		—
Convertible notes		1,111		764		1,235		450
Denominator for diluted earnings per share — adjusted weighted average shares		290,794		157,941		210,850		157,453
Basic earnings per share:
Income from continuing operations attributable to common stockholders	$	0.36	$	0.37	$	0.82	$	1.03
Discontinued operations		—		0.00		—		0.05
Net income attributable to common stockholders	$	0.36	$	0.37	$	0.82	$	1.08
Diluted earnings per share:
Income from continuing operations attributable to common stockholders	$	0.35	$	0.37	$	0.81	$	1.02
Discontinued operations		—		0.00		—		0.05
Net income attributable to common stockholders	$	0.35	$	0.37	$	0.81	$	1.07

NOTE 14 — RELATED PARTY TRANSACTIONS

Upon consummation of the Atria Senior Living acquisition, we entered into long-term management agreements with Atria to operate the acquired assets. Atria is owned by private equity funds managed by Lazard Real Estate Partners LLC (“LREP”). Effective May 13, 2011, LREP Chief Executive Officer and Managing Principal and Atria Chairman Matthew J. Lustig was appointed to our Board of Directors pursuant to the terms of a Director Appointment Agreement between us and the sellers of the acquired assets. For the three months ended September 30, 2011 and for the period from May 12, 2011 through September 30, 2011, we paid Atria $7.9 million and $12.1 million, respectively, in management fees related to the Atria Senior Living properties.

From time to time, we may engage Cushman & Wakefield, a global commercial real estate firm, to act as a leasing agent with respect to certain of our MOBs. Cushman & Wakefield President and Chief Executive Officer Glenn J. Rufrano has served as a member of our Board of Directors since June 2010. We believe the brokers’ fees we pay to Cushman & Wakefield in connection with the provision of these services are customary and represent market rates. Total fees we paid to Cushman & Wakefield during the first nine months of 2011 were de minimis.

Effective upon consummation of the NHP acquisition, Richard I. Gilchrist, a former NHP director, was appointed to our Board of Directors. Mr. Gilchrist currently serves as Senior Advisor to The Irvine Company, and from 2006 until July 2011, he served as President of The Irvine Company’s Investment Properties Group, from whom NHP leased its corporate headquarters prior to the acquisition. Nationwide Health Properties, LLC, the successor to NHP and our wholly owned subsidiary, continues to rent office space in the building owned by The Irvine Company. For both the three and nine months ended September 30, 2011, we paid $0.1 million to The Irvine Company.

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NOTE 15 — ELMCROFT II PORTFOLIO UPDATE

In connection with the NHP acquisition, we acquired a portfolio of 32 triple-net leased seniors housing communities in ten states leased to a single operator. Subsequent to the acquisition, we transitioned the operation of these properties to affiliates of Senior Care, Inc., which now operates under the name “Elmcroft Senior Living” (together with its affiliates, “Elmcroft”). Elmcroft has been a tenant of 64 of our seniors housing and other healthcare properties since 2006. To effect the transition of the properties to Elmcroft, we terminated the previously existing master lease and two other individual leases relating to the properties and entered into new leases with Elmcroft. Each of the new Elmcroft leases has a term of fifteen years and is subject to two five-year renewal options. The previous operator will continue to hold the operating licenses for the properties pursuant to temporary license agreements with Elmcroft until Elmcroft receives new operating licenses. To date, eleven licenses have been granted to Elmcroft and the remaining licenses are in process.

NOTE 16 — SEGMENT INFORMATION

As of September 30, 2011, we operated through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. Our triple-net leased properties segment consists of acquiring and owning seniors housing and healthcare properties in the United States and leasing those properties to healthcare operating companies under “triple-net” or “absolute-net” leases, which require the tenants to pay all property-related expenses. Our senior living operations segment consists of investments in seniors housing communities located in the United States and Canada for which we engage independent third parties, such as Sunrise and Atria, to manage the operations. Our MOB operations segment primarily consists of acquiring, owning, developing, leasing and managing MOBs. Information provided for “all other” includes revenues such as income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to our three reportable business segments. Assets included in all other consist primarily of corporate assets, including cash, restricted cash, deferred financing costs, loans receivable and miscellaneous accounts receivable.

We evaluate performance of the combined properties in each reportable business segment based on segment profit, which we define as NOI adjusted for gain/loss from unconsolidated entities. We define NOI as total revenues, less interest and other income, property-level operating expenses and medical office building services costs. We believe that net income, as defined by GAAP, is the most appropriate earnings measurement. However, we believe that segment profit serves as a useful supplement to net income because it allows investors, analysts and our management to measure unlevered property-level operating results and to compare our operating results to the operating results of other real estate companies and between periods on a consistent basis. Segment profit should not be considered as an alternative to net income (determined in accordance with GAAP) as an indicator of our financial performance. In order to facilitate a clear understanding of our consolidated historical operating results, segment profit should be examined in conjunction with net income as presented in our Consolidated Financial Statements and data included elsewhere in this Quarterly Report on Form 10-Q.

Interest expense, depreciation and amortization, general, administrative and professional fees, and non-property specific revenues and expenses are not allocated to individual reportable business segments for purposes of assessing segment performance. There are no intersegment sales or transfers.

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Summary information by reportable business segment is as follows:

For the three months ended September 30, 2011:

	Triple-Net		Senior
	Leased		Living		MOB		All
	Properties		Operations		Operations		Other		Total
	(In thousands)
Revenues:
Rental income	$	211,479	$	—	$	58,398	$	—	$	269,877
Resident fees and services		—		276,364		—		—		276,364
Medical office building and other services revenue		1,109		—		8,162		—		9,271
Income from loans and investments		—		—		—		10,072		10,072
Interest and other income		—		—		—		373		373
Total revenues	$	212,588	$	276,364	$	66,560	$	10,445	$	565,957
Total revenues	$	212,588	$	276,364	$	66,560	$	10,445	$	565,957
Less:
Interest and other income		—		—		—		373		373
Property-level operating expenses		—		188,856		20,305		—		209,161
Medical office building services costs		—		—		6,347		—		6,347
Segment NOI		212,588		87,508		39,908		10,072		350,076
Income from unconsolidated entities		121		—		61		—		182
Segment profit	$	212,709	$	87,508	$	39,969	$	10,072		350,258
Interest and other income										373
Interest expense										(73,756	)
Depreciation and amortization										(161,027	)
General, administrative and professional fees										(20,624	)
Loss on extinguishment of debt										(8,685	)
Litigation proceeds, net										85,327
Merger-related expenses and deal costs										(69,350	)
Other										(14,436	)
Income tax benefit										13,904
Net income									$	101,984

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For the three months ended September 30, 2010:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	117,906	$	—	$	22,817		$	—	$	140,723
Resident fees and services		—		113,182		—			—		113,182
Medical office building and other services revenue		—		—		6,711			—		6,711
Income from loans and investments		—		—		—			4,014		4,014
Interest and other income		—		—		—			35		35
Total revenues	$	117,906	$	113,182	$	29,528		$	4,049	$	264,665
Total revenues	$	117,906	$	113,182	$	29,528		$	4,049	$	264,665
Less:
Interest and other income		—		—		—			35		35
Property-level operating expenses		—		74,066		7,941			—		82,007
Medical office building services costs		—		—		4,633			—		4,633
Segment NOI		117,906		39,116		16,954			4,014		177,990
Loss from unconsolidated entities		—		—		(392	)		—		(392	)
Segment profit	$	117,906	$	39,116	$	16,562		$	4,014		177,598
Interest and other income											35
Interest expense											(45,519	)
Depreciation and amortization											(52,104	)
General, administrative and professional fees											(15,278	)
Merger-related expenses and deal costs											(5,142	)
Other											419
Income tax expense											(1,657	)
Discontinued operations											542
Net income										$	58,894

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For the nine months ended September 30, 2011:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	450,211	$	—	$	106,392		$	—	$	556,603
Resident fees and services		—		593,348		—			—		593,348
Medical office building and other services revenue		1,109		—		24,941			—		26,050
Income from loans and investments		—		—		—			24,548		24,548
Interest and other income		—		—		—			529		529
Total revenues	$	451,320	$	593,348	$	131,333		$	25,077	$	1,201,078
Total revenues	$	451,320	$	593,348	$	131,333		$	25,077	$	1,201,078
Less:
Interest and other income		—		—		—			529		529
Property-level operating expenses		—		403,706		37,259			—		440,965
Medical office building services costs		—		—		19,837			—		19,837
Segment NOI		451,320		189,642		74,237			24,548		739,747
Income (loss) from unconsolidated entities		121		—		(192	)		—		(71	)
Segment profit	$	451,441	$	189,642	$	74,045		$	24,548		739,676
Interest and other income											529
Interest expense											(170,046	)
Depreciation and amortization											(293,541	)
General, administrative and professional fees											(51,010	)
Loss on extinguishment of debt											(25,211	)
Litigation proceeds, net											85,327
Merger-related expenses and deal costs											(131,606	)
Other											(6,664	)
Income tax benefit											23,310
Net income										$	170,764

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For the nine months ended September 30, 2010:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	351,625	$	—	$	47,246		$	—	$	398,871
Resident fees and services		—		331,535		—			—		331,535
Medical office building and other services revenue		—		—		6,711			—		6,711
Income from loans and investments		—		—		—			11,336		11,336
Interest and other income		—		—		—			420		420
Total revenues	$	351,625	$	331,535	$	53,957		$	11,756	$	748,873
Total revenues	$	351,625	$	331,535	$	53,957		$	11,756	$	748,873
Less:
Interest and other income		—		—		—			420		420
Property-level operating expenses		—		219,802		16,267			—		236,069
Medical office building services costs		—		—		4,633			—		4,633
Segment NOI		351,625		111,733		33,057			11,336		507,751
Loss from unconsolidated entities		—		—		(392	)		—		(392	)
Segment profit	$	351,625	$	111,733	$	32,665		$	11,336		507,359
Interest and other income											420
Interest expense											(133,449	)
Depreciation and amortization											(154,458	)
General, administrative and professional fees											(35,819	)
Loss on extinguishment of debt											(6,549	)
Merger-related expenses and deal costs											(11,668	)
Other											404
Income tax expense											(2,352	)
Discontinued operations											7,139
Net income										$	171,027

Assets by reportable business segment are as follows:

	As of				As of
	September 30,				December 31,
	2011				2010
	(In thousands)
Assets:
Triple-net leased properties	$	8,652,706	50.3	%	$	2,474,612	43.0	%
Senior living operations		5,807,192	33.7			2,297,041	39.9
MOB operations		2,367,480	13.8			748,945	13.0
All other assets		378,392	2.2			237,423	4.1
Total assets	$	17,205,770	100.0	%	$	5,758,021	100.0	%

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Capital expenditures, including investments in real estate property and development project expenditures, by reportable business segment are as follows:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands)
Capital expenditures:
Triple-net leased properties	$	68,604	$	211	$	69,831	$	12,303
Senior living operations		20,842		3,889		296,446		6,782
MOB operations		23,432		218,307		30,301		233,315
Total capital expenditures	$	112,878	$	222,407	$	396,578	$	252,400

Our portfolio of properties and real estate loan and other investments are located in the United States and Canada. Revenues are attributed to an individual country based on the location of each property.

Geographic information regarding our operations is as follows:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands)
Revenues:
United States	$	542,533	$	246,358	$	1,132,047	$	695,252
Canada		23,424		18,307		69,031		53,621
Total revenues	$	565,957	$	264,665	$	1,201,078	$	748,873

	As of		As of
	September 30,		December 31,
	2011		2010
	(In thousands)
Net real estate property:
United States	$	15,598,457	$	4,857,510
Canada		397,585		422,009
Total net real estate property	$	15,996,042	$	5,279,519

NOTE 17 — CONDENSED CONSOLIDATING INFORMATION

At the time of initial issuance, we and certain of our direct and indirect wholly owned subsidiaries (the “Wholly Owned Subsidiary Guarantors”) fully and unconditionally guaranteed, on a joint and several basis, the obligation to pay principal and interest with respect to the 9% senior notes due 2012, the 6¹/2% senior notes due 2016 and the 6³/4% senior notes due 2017 of our wholly owned subsidiaries, Ventas Realty, Limited Partnership (“Ventas Realty”) and Ventas Capital Corporation (collectively, the “Ventas Issuers”). Ventas Capital Corporation is a direct subsidiary of Ventas Realty that was formed in 2002 to facilitate offerings of the senior notes and has no assets or operations. In addition, at the time of initial issuance, Ventas Realty and the Wholly Owned Subsidiary Guarantors fully and unconditionally guaranteed, on a joint and several basis, the obligation to pay principal and interest with respect to our 3⁷/₈% convertible senior notes due 2011. Other subsidiaries (“Non-Guarantor Subsidiaries”) that were not included among the Wholly Owned Subsidiary Guarantors were not obligated with respect to the senior notes or the convertible notes. On September 30, 2010, the Wholly Owned Subsidiary Guarantors were released from their obligations with respect to the 6¹/2% senior notes due 2016 and the 6³/4% senior notes due 2017 of the Ventas Issuers and our convertible notes pursuant to the terms of the applicable indentures.

36

In connection with the NHP acquisition, our wholly owned subsidiary, Nationwide Health Properties, LLC, assumed the obligation to pay principal and interest with respect to the 8¹/4% senior notes due 2012, the 6.25% senior notes due 2013, the 6.00% senior notes due 2015, the 6.90% senior notes due 2037 and the 6.59% senior notes due 2038 of NHP. We, the Ventas Issuers and our subsidiaries (other than Nationwide Health Properties, LLC) are not obligated with respect to the NHP senior notes.

Contractual and legal restrictions, including those contained in the instruments governing our subsidiaries’ outstanding mortgage indebtedness, may under certain circumstances restrict our ability to obtain cash from our subsidiaries for the purpose of meeting our debt service obligations, including our guarantee of payment of principal and interest on the Ventas Issuers’ senior notes and our primary obligation to pay principal and interest on our convertible notes. Certain of our real estate assets are also subject to mortgages.

The following summarizes our condensed consolidating information as of September 30, 2011 and December 31, 2010 and for the three and nine months ended September 30, 2011 and 2010:

CONDENSED CONSOLIDATING BALANCE SHEET
As of September 30, 2011

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor		Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries		Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	464		$	3,388,426	$	566,852		$	12,461,886	$	—		$	16,417,628
Cash and cash equivalents		2,252			24,898		—			30,332		—			57,482
Escrow deposits and restricted cash		1,961			25,901		7,131			49,790		—			84,783
Deferred financing costs, net		2,914			725		2,298			6,487		—			12,424
Investment in and advances to affiliates		8,441,898			—		1,728,685			—		(10,170,583	)		—
Other assets		67,190			196,204		8,134			361,925		—			633,453
Total assets	$	8,516,679		$	3,636,154	$	2,313,100		$	12,910,420	$	(10,170,583	)	$	17,205,770
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	229,363		$	235,185	$	2,240,589		$	3,608,004	$	—		$	6,313,141
Intercompany loans		(211,796	)		843,546		(670,085	)		38,335		—			—
Accrued interest		(218	)		744		40,093			25,366		—			65,985
Accounts payable and other liabilities		95,091			174,086		17,867			841,662		—			1,128,706
Deferred income taxes		274,852			—		—			—		—			274,852
Total liabilities		387,292			1,253,561		1,628,464			4,513,367		—			7,782,684
Redeemable OP unitholder interests		—			—		—			92,817		—			92,817
Total equity		8,129,387			2,382,593		684,636			8,304,236		(10,170,583	)		9,330,269
Total liabilities and equity	$	8,516,679		$	3,636,154	$	2,313,100		$	12,910,420	$	(10,170,583	)	$	17,205,770

37

CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2010

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	937		$	3,244,243	$	688,158		$	1,510,776		$	—		$	5,444,114
Cash and cash equivalents		1,083			15,659		—			5,070			—			21,812
Escrow deposits and restricted cash		76			19,786		9,169			9,909			—			38,940
Deferred financing costs, net		2,691			1,961		7,961			6,920			—			19,533
Investment in and advances to affiliates		1,414,170			—		1,028,721			—			(2,442,891	)		—
Other assets		75,794			119,773		8,057			29,998			—			233,622
Total assets	$	1,494,751		$	3,401,422	$	1,742,066		$	1,562,673		$	(2,442,891	)	$	5,758,021
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	225,644		$	539,564	$	1,301,089		$	833,747		$	—		$	2,900,044
Intercompany loans		(144,897	)		586,605		(434,454	)		(7,254	)		—			—
Accrued interest		(113	)		2,704		12,852			3,853			—			19,296
Accounts payable and other liabilities		41,355			103,444		15,712			46,632			—			207,143
Deferred income taxes		241,333			—		—			—			—			241,333
Total liabilities		363,322			1,232,317		895,199			876,978			—			3,367,816
Total equity		1,131,429			2,169,105		846,867			685,695			(2,442,891	)		2,390,205
Total liabilities and equity	$	1,494,751		$	3,401,422	$	1,742,066		$	1,562,673		$	(2,442,891	)	$	5,758,021

38

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Three Months Ended September 30, 2011

				Wholly
				Owned				Non-
				Subsidiary		Ventas		Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers		Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	623		$	55,453	$	71,611	$	142,190		$	—		$	269,877
Resident fees and services		—			100,885		—		175,479			—			276,364
Medical office building and other services revenues		—			8,162		—		1,109			—			9,271
Income from loans and investments		1,124			428		103		8,417			—			10,072
Equity earnings in affiliates		52,119			258		—		—			(52,377	)		—
Interest and other income		6			7		10		350			—			373
Total revenues		53,872			165,193		71,724		327,545			(52,377	)		565,957
Expenses:
Interest		392			14,241		21,952		37,171			—			73,756
Depreciation and amortization		440			34,908		8,795		116,884			—			161,027
Property-level operating expenses		—			78,415		115		130,631			—			209,161
Medical office building services costs		—			6,347		—		—			—			6,347
General, administrative and professional fees		1,194			9,074		6,427		3,929			—			20,624
Loss on extinguishment of debt		—			—		8,685		—			—			8,685
Litigation proceeds, net		(85,327	)		—		—		—			—			(85,327	)
Merger-related expenses and deal costs		47,309			674		—		21,367			—			69,350
Other		883			1,863		—		11,690			—			14,436
Total expenses		(35,109	)		145,522		45,974		321,672			—			478,059
Income from continuing operations before gain from unconsolidated entities, income taxes and noncontrolling interest		88,981			19,671		25,750		5,873			(52,377	)		87,898
Gain from unconsolidated entities		—			—		61		121			—			182
Income tax benefit		13,904			—		—		—			—			13,904
Net income		102,885			19,671		25,811		5,994			(52,377	)		101,984
Net loss attributable to noncontrolling interest, net of tax		—			—		—		(901	)		—			(901	)
Net income attributable to common stockholders	$	102,885		$	19,671	$	25,811	$	6,895		$	(52,377	)	$	102,885

39

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Three Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	607		$	52,463		$	70,534		$	17,119		$	—		$	140,723
Resident fees and services		—			65,252			—			47,930			—			113,182
Medical office building and other services revenues		—			6,711			—			—			—			6,711
Income from loans and investments		1,406			755			1,853			—			—			4,014
Equity earnings in affiliates		61,077			439			—			—			(61,516	)		—
Interest and other income		18			4			21			(8	)		—			35
Total revenues		63,108			125,624			72,408			65,041			(61,516	)		264,665
Expenses:
Interest		820			18,386			13,261			13,052			—			45,519
Depreciation and amortization		412			28,889			9,296			13,507			—			52,104
Property-level operating expenses		—			46,908			134			34,965			—			82,007
Medical office building services costs		—			4,633			—			—			—			4,633
General, administrative and professional fees		203			8,311			5,575			1,189			—			15,278
Merger-related expenses and deal costs		3,573			1,569			—			—			—			5,142
Other		(477	)		60			—			(2	)		—			(419	)
Total expenses		4,531			108,756			28,266			62,711			—			204,264
Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		58,577			16,868			44,142			2,330			(61,516	)		60,401
Loss from unconsolidated entities		—			—			(392	)		—			—			(392	)
Income tax expense		(679	)		(978	)		—			—			—			(1,657	)
Income from continuing operations		57,898			15,890			43,750			2,330			(61,516	)		58,352
Discontinued operations		—			422			120			—			—			542
Net income		57,898			16,312			43,870			2,330			(61,516	)		58,894
Net income attributable to noncontrolling interest, net of tax		—			352			—			644			—			996
Net income attributable to common stockholders	$	57,898		$	15,960		$	43,870		$	1,686		$	(61,516	)	$	57,898

40

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Nine Months Ended September 30, 2011

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	1,848		$	165,454	$	212,653		$	176,648		$	—		$	556,603
Resident fees and services		—			252,803		—			340,545			—			593,348
Medical office building and other services revenues		—			24,941		—			1,109			—			26,050
Income from loans and investments		5,070			2,495		8,566			8,417			—			24,548
Equity earnings in affiliates		160,275			1,102		—			—			(161,377	)		—
Interest and other income		96			19		52			362			—			529
Total revenues		167,289			446,814		221,271			527,081			(161,377	)		1,201,078
Expenses:
Interest		(474	)		45,409		53,457			71,654			—			170,046
Depreciation and amortization		1,273			95,651		26,706			169,911			—			293,541
Property-level operating expenses		—			192,137		414			248,414			—			440,965
Medical office building services costs		—			19,837		—			—			—			19,837
General, administrative and professional fees		(5,840	)		28,101		21,625			7,124			—			51,010
Loss on extinguishment of debt		—			16,526		8,685			—			—			25,211
Litigation proceeds, net		(85,327	)		—		—			—			—			(85,327	)
Merger-related expenses and deal costs		108,509			1,730		—			21,367			—			131,606
Other		913			2,950		—			2,801			—			6,664
Total expenses		19,054			402,341		110,887			521,271			—			1,053,553
Income from continuing operations before (loss) income from unconsolidated entities, income taxes and noncontrolling interest		148,235			44,473		110,384			5,810			(161,377	)		147,525
(Loss) income from unconsolidated entities		—			—		(192	)		121			—			(71	)
Income tax benefit		23,310			—		—			—			—			23,310
Net income		171,545			44,473		110,192			5,931			(161,377	)		170,764
Net income attributable to noncontrolling interest, net of tax		—			—		—			(781	)		—			(781	)
Net income attributable to common stockholders	$	171,545		$	44,473	$	110,192		$	6,712		$	(161,377	)	$	171,545

41

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Nine Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor		Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries		Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	1,802		$	141,317		$	209,879		$	45,873	$	—		$	398,871
Resident fees and services		—			190,801			—			140,734		—			331,535
Medical office building and other services revenues		—			6,711			—			—		—			6,711
Income from loans and investments		4,247			1,635			5,454			—		—			11,336
Equity earnings in affiliates		176,659			1,307			—			—		(177,966	)		—
Interest and other income		310			40			63			7		—			420
Total revenues		183,018			341,811			215,396			186,614		(177,966	)		748,873
Expenses:
Interest		1,096			56,371			39,658			36,324		—			133,449
Depreciation and amortization		1,219			84,084			28,429			40,726		—			154,458
Property-level operating expenses		—			132,036			398			103,635		—			236,069
Medical office building services costs		—			4,633			—			—		—			4,633
General, administrative and professional fees		323			16,870			15,414			3,212		—			35,819
Loss on extinguishment of debt		—			102			6,447			—		—			6,549
Merger-related expenses and deal costs		10,041			1,617			—			10		—			11,668
Other		(435	)		31			—			—		—			(404	)
Total expenses		12,244			295,744			90,346			183,907		—			582,241
Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		170,774			46,067			125,050			2,707		(177,966	)		166,632
Loss from unconsolidated entities		—			—			(392	)		—		—			(392	)
Income tax expense		(2,190	)		(162	)		—			—		—			(2,352	)
Income from continuing operations		168,584			45,905			124,658			2,707		(177,966	)		163,888
Discontinued operations		—			1,132			6,007			—		—			7,139
Net income		168,584			47,037			130,665			2,707		(177,966	)		171,027
Net income attributable to noncontrolling interest, net of tax		—			1,134			—			1,309		—			2,443
Net income attributable to common stockholders	$	168,584		$	45,903		$	130,665		$	1,398	$	(177,966	)	$	168,584

42

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Nine Months Ended September 30, 2011

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination		Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(3,510	)	$	107,282		$	180,935		$	159,194		$	—	$	443,901
Net cash (used in) provided by investing activities		(431,727	)		89,296			(500,879	)		386			—		(842,924	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		—			—			434,000			—			—		434,000
Proceeds from debt		—			—			689,374			268,379			—		957,753
Repayment of debt		—			(328,691	)		(206,500	)		(359,852	)		—		(895,043	)
Net change in intercompany debt		981,494			84,585			(1,208,212	)		142,133			—		—
Payment of deferred financing costs		—			—			(1,519	)		(379	)		—		(1,898	)
Issuance of common stock, net		299,926			—			—			—			—		299,926
Cash distribution (to) from affiliates		(491,099	)		56,767			612,898			(178,566	)		—		—
Cash distribution to common stockholders		(354,932	)		—			—			—			—		(354,932	)
Cash distribution to redeemable OP unitholders		—			—			—			(4,038	)		—		(4,038	)
Contributions from noncontrolling interest		—			—			—			2			—		2
Distributions to noncontrolling interest		—			—			—			(1,997	)		—		(1,997	)
Other		1,017			—			—			—			—		1,017
Net cash provided by (used in) financing activities		436,406			(187,339	)		320,041			(134,318	)		—		434,790
Net increase in cash and cash equivalents		1,169			9,239			97			25,262			—		35,767
Effect of foreign currency translation on cash and cash equivalents		—			—			(97	)		—			—		(97	)
Cash and cash equivalents at beginning of period		1,083			15,659			—			5,070			—		21,812
Cash and cash equivalents at end of period	$	2,252		$	24,898		$	—		$	30,332		$	—	$	57,482

43

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Nine Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination		Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(864	)	$	118,174		$	179,105		$	49,704		$	—	$	346,119
Net cash used in investing activities		—			(57,096	)		(207,509	)		(3,871	)		—		(268,476	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		—			102,004			131,000			—			—		233,004
Proceeds from debt		—			—			200,000			1,237			—		201,237
Repayment of debt		—			(144,739	)		(178,139	)		(8,500	)		—		(331,378	)
Net change in intercompany debt		48,748			(59,452	)		10,704			—			—		—
Payment of deferred financing costs		—			(46	)		(1,826	)		—			—		(1,872	)
Cash distribution from (to) affiliates		199,706			50,104			(216,290	)		(33,520	)		—		—
Cash distribution to common stockholders		(251,921	)		—			—			—			—		(251,921	)
Contributions from noncontrolling interest		—			—			—			818			—		818
Distributions to noncontrolling interest		—			—			—			(6,633	)		—		(6,633	)
Other		5,426			—			—			—			—		5,426
Net cash provided by (used in) financing activities		1,959			(52,129	)		(54,551	)		(46,598	)		—		(151,319	)
Net increase (decrease) in cash and cash equivalents		1,095			8,949			(82,955	)		(765	)		—		(73,676	)
Effect of foreign currency translation on cash and cash equivalents		—			—			69			—			—		69
Cash and cash equivalents at beginning of period		—			7,864			82,886			16,647			—		107,397
Cash and cash equivalents at end of period	$	1,095		$	16,813		$	—		$	15,882		$	—	$	33,790

44

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Cautionary Statements

Unless otherwise indicated or except where the context otherwise requires, the terms “we,” “us” and “our” and other similar terms in this Quarterly Report on Form 10-Q refer to Ventas, Inc. and its consolidated subsidiaries.

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements regarding our or our tenants’, operators’, managers’ or borrowers’ expected future financial position, results of operations, cash flows, funds from operations, dividends and dividend plans, financing plans, business strategy, budgets, projected costs, operating metrics, capital expenditures, competitive positions, acquisitions, investment opportunities, dispositions, merger integration, growth opportunities, expected lease income, continued qualification as a real estate investment trust (“REIT”), plans and objectives of management for future operations and statements that include words such as “anticipate,” “if,” “believe,” “plan,” “estimate,” “expect,” “intend,” “may,” “could,” “should,” “will” and other similar expressions are forward-looking statements. These forward-looking statements are inherently uncertain, and security holders must recognize that actual results may differ from our expectations. We do not undertake a duty to update these forward-looking statements, which speak only as of the date on which they are made.

Our actual future results and trends may differ materially from expectations depending on a variety of factors discussed in our filings with the Securities and Exchange Commission (the “SEC”). These factors include without limitation:

• The ability and willingness of our tenants, operators, borrowers, managers and other third parties to meet and/or perform their obligations under their respective contractual arrangements with us, including, in some cases, their obligations to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities;

• The ability of our tenants, operators, borrowers and managers to maintain the financial strength and liquidity necessary to satisfy their respective obligations and liabilities to third parties, including without limitation obligations under their existing credit facilities and other indebtedness;

• Our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate diversifying acquisitions or investments, including the Nationwide Health Properties, Inc. (“NHP”) transaction and those in different asset types and outside the United States;

• Macroeconomic conditions such as a disruption of or lack of access to the capital markets, changes in the debt rating on U.S. government securities, default and/or delay in payment by the United States of its obligations, and changes in the federal budget resulting in the reduction or nonpayment of Medicare or Medicaid reimbursement rates;

• The nature and extent of future competition;

• The extent of future or pending healthcare reform and regulation, including cost containment measures and changes in reimbursement policies, procedures and rates;

• Increases in our cost of borrowing as a result of changes in interest rates and other factors;

• The ability of our operators and managers, as applicable, to deliver high quality services, to attract and retain qualified personnel and to attract residents and patients;

• Changes in general economic conditions and/or economic conditions in the markets in which we may, from time to time, compete, and the effect of those changes on our revenues and our ability to access the capital markets or other sources of funds;

• Our ability to pay down, refinance, restructure and/or extend our indebtedness as it becomes due;

• Our ability and willingness to maintain our qualification as a REIT due to economic, market, legal, tax or other considerations;

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• Final determination of our taxable net income for the year ending December 31, 2011;

• The ability and willingness of our tenants to renew their leases with us upon expiration of the leases and our ability to reposition our properties on the same or better terms in the event such leases expire and are not renewed by our tenants or in the event we exercise our right to replace an existing tenant upon a default;

• Risks associated with our senior living operating portfolio, such as factors causing volatility in our operating income and earnings generated by our properties, including without limitation national and regional economic conditions, costs of materials, energy, labor and services, employee benefit costs, insurance costs and professional and general liability claims, and the timely delivery of accurate property-level financial results for those properties;

• The movement of U.S. and Canadian exchange rates;

• Year-over-year changes in the Consumer Price Index and the effect of those changes on the rent escalators, including the rent escalator for Master Lease 2 with Kindred Healthcare, Inc. (together with its subsidiaries, “Kindred”), and our earnings;

• Our ability and the ability of our tenants, operators, borrowers and managers to obtain and maintain adequate liability and other insurance from reputable and financially stable providers;

• The impact of increased operating costs and uninsured professional liability claims on the liquidity, financial condition and results of operations of our tenants, operators, borrowers and managers and the ability of our tenants, operators, borrowers and managers to accurately estimate the magnitude of those claims;

• Risks associated with our medical office building (“MOB”) portfolio and operations, including our ability to successfully design, develop and manage MOBs, to accurately estimate our costs in fixed fee-for-service projects and to retain key personnel;

• The ability of the hospitals on or near whose campuses our MOBs are located and their affiliated health systems to remain competitive and financially viable and to attract physicians and physician groups;

• Our ability to maintain or expand our relationships with our existing and future hospital and health system clients;

• Risks associated with our investments in joint ventures and unconsolidated entities, including our lack of sole decision-making authority and our reliance on our joint venture partners’ financial condition;

• The impact of market or issuer events on the liquidity or value of our investments in marketable securities; and

• The impact of any financial, accounting, legal or regulatory issues or litigation that may affect us or our major tenants, operators and managers.

Many of these factors are beyond our control and the control of our management.

Kindred, Brookdale Senior Living, Sunrise and Atria Information

Each of Kindred, Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”) and Sunrise Senior Living, Inc. (together with its subsidiaries, “Sunrise”) is subject to the reporting requirements of the SEC and is required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information. The information related to Kindred, Brookdale Senior Living and Sunrise contained or referred to in this Quarterly Report on Form 10-Q is derived from filings made by Kindred, Brookdale Senior Living or Sunrise, as the case may be, with the SEC or other publicly available information, or has been provided to us by Kindred, Brookdale Senior Living or Sunrise. We have not verified this information either through an independent investigation or by reviewing Kindred’s, Brookdale Senior Living’s or Sunrise’s public filings. We have no reason to believe that this information is inaccurate in any material respect, but we cannot assure you that all of this information is accurate. Kindred’s, Brookdale Senior Living’s and Sunrise’s filings with the SEC can be found at the SEC’s website at www.sec.gov. We are providing this data for informational purposes only, and you are encouraged to obtain Kindred’s, Brookdale Senior Living’s and Sunrise’s publicly available filings from the SEC.

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Atria Senior Living, Inc. (“Atria”) is not subject to the reporting requirements of the SEC. The information related to Atria contained or referred to in this Quarterly Report on Form 10-Q has been provided to us by Atria. We have not verified this information through an independent investigation. We have no reason to believe that this information is inaccurate in any material respect, but we cannot assure you that all of this information is accurate.

Company Overview

We are a REIT with a geographically diverse portfolio of seniors housing and healthcare properties in the United States and Canada. As of September 30, 2011, our portfolio consisted of 1,361 properties: 673 seniors housing communities, 398 skilled nursing facilities, 47 hospitals and 243 MOBs and other properties in 46 states, the District of Columbia and two Canadian provinces. We are a constituent member of the S&P 500^® index, a leading indicator of the large cap U.S. equities market, with our headquarters located in Chicago, Illinois.

Our primary business consists of acquiring and owning seniors housing and healthcare properties and leasing those properties to unaffiliated tenants or operating those properties through independent third-party managers. Through our Lillibridge Healthcare Services, Inc. (“Lillibridge”) subsidiary and our ownership interest in PMB Real Estate Services LLC (“PMBRES”), which we acquired in July 2011 in connection with the NHP acquisition, we also provide management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make real estate loan and other investments relating to seniors housing and healthcare companies or properties.

As of September 30, 2011, we leased 927 of our properties (excluding MOBs) to healthcare operating companies under “triple-net” or “absolute-net” leases that obligate the tenants to pay all property-related expenses (including maintenance, utilities, repairs, taxes, insurance and capital expenditures), and we engaged independent third parties, such as Sunrise and Atria, to manage 199 of our seniors housing communities pursuant to long-term management agreements.

Our business strategy is comprised of three principal objectives: (1) generating consistent, reliable and growing cash flows; (2) maintaining a well-diversified portfolio; and (3) preserving our investment grade balance sheet and liquidity.

Access to external capital is critical to the success of our strategy as it impacts our ability to meet our existing commitments, including repaying maturing indebtedness, and to make future investments. Our access to and cost of capital depend on various factors, including general market conditions, interest rates, credit ratings on our securities, perception of our potential future earnings and cash distributions, and the market price of our common stock. Generally, we attempt to match the long-term duration of most of our investments with long-term fixed rate financing. At September 30, 2011, only 18.6% of our consolidated debt was variable rate debt.

Operating Highlights and Key Performance Trends

2011 Highlights

• Our Board of Directors declared the first and second quarterly installments of our 2011 dividend in the amount of $0.575 per share, which represents a 7.5% increase over our 2010 quarterly dividend. The first quarterly installment of the 2011 dividend was paid in cash on March 31, 2011 to stockholders of record on March 11, 2011. The second quarterly installment of the 2011 dividend was paid in cash on June 30, 2011 to stockholders of record on June 10, 2011. In connection with the NHP acquisition, on June 20, 2011, our Board of Directors declared a prorated third quarter dividend on our common stock in the amount of $0.1264 per share, which was paid in cash on July 12, 2011 to stockholders of record at the close of business on June 30, 2011. On August 19, 2011, our Board of Directors declared another prorated third quarter dividend on our common stock in the amount of $0.4486 per share, which was paid in cash on September 30, 2011 to stockholders of record on September 13, 2011. Together, these two prorated amounts equate to our regular quarterly dividend of $0.575 per share and constitute the third quarterly installment of our 2011 dividend.

• In February 2011, we completed the sale of 5,563,000 shares of our common stock in an underwritten public offering pursuant to our existing shelf registration statement. We received $300.0 million in aggregate proceeds from the sale, which we used to repay existing mortgage debt and for working capital and other general corporate purposes.

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• In February 2011, we repaid in full mortgage loans outstanding in the aggregate principal amount of $307.2 million and recognized a loss on extinguishment of debt of $16.5 million in connection with this repayment in the first quarter of 2011.

• In April 2011, we received proceeds of $112.4 million for repayment of a first mortgage loan and recognized a gain of $3.3 million (included in income from loans and investments on our Consolidated Statements of Income) in connection with this repayment in the second quarter of 2011.

• In May 2011, we issued and sold $700.0 million aggregate principal amount of 4.750% senior notes due 2021, at a public offering price equal to 99.132% of par for total proceeds of $693.9 million, before the underwriting discount and expenses. We used a portion of the proceeds from the issuance to fund a senior unsecured term loan to NHP in the aggregate principal amount of $600.0 million, bearing interest at a fixed rate of 5.0% per annum and maturing in 2021. As of our acquisition date of NHP, this investment and related interest were eliminated in consolidation.

• In May 2011, we acquired substantially all of the real estate assets and working capital of privately-owned Atria Senior Living Group, Inc. (together with its affiliates, “Atria Senior Living”). See “Note 4—Acquisitions of Real Estate Property” of the Notes to Consolidated Financial Statements included in Part I of this Quarterly Report on Form 10-Q.

• Effective May 13, 2011, Matthew J. Lustig, Chief Executive Officer and Managing Principal of Lazard Real Estate Partners LLC and Atria Chairman, was appointed to our Board of Directors.

• On July 1, 2011, we acquired NHP in a stock-for-stock transaction. At the time of acquisition, each outstanding share of NHP common stock (other than shares owned by us or any of our subsidiaries or any wholly owned subsidiary of NHP) was converted into the right to receive 0.7866 shares of our common stock, with cash paid in lieu of fractional shares. See “Note 4—Acquisitions of Real Estate Property” of the Notes to Consolidated Financial Statements included in Part I of this Quarterly Report on Form 10-Q.

• On July 1, 2011, following approval by our stockholders, we amended our Amended and Restated Certificate of Incorporation, as previously amended, to increase the number of authorized shares of our capital stock to 610,000,000, comprised of 600,000,000 shares of common stock, par value $0.25 per share, and 10,000,000 shares of preferred stock, par value $1.00 per share.

• Also on July 1, 2011, we amended our Fourth Amended and Restated By-laws to increase the maximum number of directors allowed to serve on the Board of Directors at any one time from eleven to thirteen and appointed three former NHP directors to our Board: Douglas M. Pasquale, Richard I. Gilchrist and Robert D. Paulson.

• In July 2011, we redeemed $200.0 million principal amount of our outstanding 6¹/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $8.7 million during the third quarter of 2011.

• On July 15, 2011, we repaid in full, at par, $339.0 million principal amount then outstanding of NHP’s 6.50% senior notes due 2011 upon maturity.

• On August 22, 2011, the United States District Court for the Western District of Kentucky ruled that HCP, Inc. (“HCP”) could not further delay enforcement of our $101.6 million compensatory damages award. On August 23, 2011, HCP paid us $102.8 million for the judgment plus certain costs and interest. For the three and nine months ended September 30, 2011, we recorded approximately $85 million in net income as a result of this litigation, after accrual of certain unpaid fees and the contingent fee for our outside legal counsel and payment of a $3 million donation to the Ventas Charitable Foundation, which supports worthwhile causes important to our customers, our employees and our communities. See “Note 10-Litigation” of the Notes to Consolidated Financial Statements included in Part I of this Quarterly Report on Form 10-Q.

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• On October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new $2.0 billion unsecured revolving credit facility. The aggregate borrowing capacity under our new unsecured revolving credit facility may be increased, at our option subject to the satisfaction of certain conditions, to up to $2.5 billion. Borrowings under our new unsecured revolving credit facility mature on October 16, 2015, but may be extended, at our option subject to the satisfaction of certain conditions, for an additional period of one year. See “Note 8-Senior Notes Payable and Other Debt” of the Notes to Consolidated Financial Statements included in Part I of this Quarterly Report on Form 10-Q.

• In October 2011, we invested approximately $150.3 million, including the assumption of $37.7 million in debt, in two MOBs and two seniors housing communities (one of which is being managed by Atria).

• In connection with the acquisition of NHP, we gained the benefit of additional liquidity from an $800 million term loan previously extended to NHP, priced at LIBOR plus 150 basis points. On November 1, 2011, we repaid all amounts outstanding under the term loan. The term loan matures in June 2012 and currently has $550 million of available borrowing capacity.

Concentration Risk

We use concentration ratios to understand the potential risks of economic downturns or other adverse events affecting our various asset types, geographic locations or tenants, operators and managers. We evaluate our concentration risk in terms of investment mix and operations mix. Investment mix measures the portion of our investments that consists of a certain asset type or that is operated or managed by a particular tenant, operator or manager. Operations mix measures the portion of our operating results that is attributed to a certain tenant or operator, geographic location or business model. The following tables reflect our concentration risk as of the dates and for the periods presented:

	September 30, 2011			December 31, 2010
Investment mix by asset type1:
Seniors housing communities		66.2	%		70.2	%
Skilled nursing facilities		16.7	%		11.7	%
MOBs		12.7	%		10.8	%
Hospitals		2.6	%		5.0	%
Loans receivable, net		1.7	%		2.2	%
Other properties		0.1	%		0.1	%
Investment mix by tenant, operator and manager1:
Atria		18.7	%		N/A
Sunrise		14.4	%		37.9	%
Brookdale Senior Living		13.0	%		19.7	%
Kindred		5.0	%		13.1	%
All other		48.9	%		29.3	%

¹ Ratios are based on the gross book value of real estate investments as of each reporting date.

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	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2011			2010			2011			2010
Operations mix by tenant and operator and business model:
Revenues1:
Senior living operations2		49.3	%		42.7	%		49.4	%		44.1	%
Kindred		11.3	%		23.5	%		15.8	%		24.6	%
Brookdale Senior Living		8.1	%		11.3	%		8.7	%		12.1	%
All others		31.3	%		22.5	%		26.1	%		19.2	%
Adjusted EBITDA3:
Senior living operations2		23.5	%		22.7	%		25.3	%		22.3	%
Kindred		17.4	%		34.2	%		24.3	%		35.3	%
Brookdale Senior Living		12.8	%		16.4	%		12.2	%		17.3	%
All others		46.3	%		26.7	%		38.2	%		25.1	%
NOI4:
Senior living operations2		24.8	%		21.9	%		25.6	%		21.9	%
Kindred		18.3	%		34.8	%		25.6	%		36.2	%
Brookdale Senior Living		13.1	%		16.8	%		14.1	%		17.8	%
All others		43.8	%		26.5	%		34.7	%		24.1	%
Operations mix by geographic location5:
California		14.4	%		11.6	%		13.4	%		12.2	%
New York		9.9	%		3.4	%		8.1	%		3.5	%
Texas		6.1	%		2.7	%		4.4	%		2.7	%
Illinois		5.3	%		10.1	%		7.0	%		10.3	%
Massachusetts		5.0	%		4.8	%		5.0	%		5.1	%
All others		59.3	%		67.4	%		62.1	%		66.2	%

1	Total revenues includes medical office building and other services revenue, revenue from loans and investments and interest and other income. Revenues from properties sold or held for sale as of the reporting date are included in this presentation.
2	Amounts attributable to senior living operations managed by Atria for the nine months ended September 30, 2011 relate to the period from May 12, 2011, the date of the Atria Senior Living acquisition, through September 30, 2011.
3	“Adjusted EBITDA” is defined as earnings before interest, taxes, depreciation and amortization (including non-cash stock-based compensation expense), excluding net litigation proceeds, merger-related expenses and deal costs, gains or losses on sales of real property assets and changes in the fair value of financial instruments (including amounts in discontinued operations).
4	“NOI” represents net operating income, which is defined as total revenues, excluding interest and other income, less property-level operating expenses and medical office building services costs (including amounts in discontinued operations).
5	Ratios are based on total revenues for each period presented. Total revenues includes medical office building and other services revenue, revenue from loans and investments and interest and other income. Revenues from properties sold as of the reporting date are excluded from this presentation.

See “Non-GAAP Financial Measures” included elsewhere in this Quarterly Report on Form 10-Q for additional disclosure and reconciliations of Adjusted EBITDA and NOI to our net income or total revenues, as applicable, as computed in accordance with U.S. generally accepted accounting principles (“GAAP”).

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Recent Developments Regarding Government Regulation

Medicare Reimbursement: Long-Term Acute Care Hospitals

On August 1, 2011, the Centers for Medicare & Medicaid Services (“CMS”) put on public display for August 18, 2011 publication its final rule updating the prospective payment system for long-term acute care hospitals (LTAC PPS) for the 2012 fiscal year (October 1, 2011 through September 30, 2012). Under the final rule, the LTAC PPS standard federal payment rate will increase by 1.8% in fiscal year 2012, reflecting a 2.9% increase in the market basket index, less a 1.0% productivity adjustment and an additional 0.1% negative adjustment mandated by the Patient Protection and Affordable Care Act and its reconciliation measure, the Health Care and Education Reconciliation Act of 2010 (collectively, the “Affordable Care Act”). As a result, CMS estimates that net payments to long-term acute care hospitals in fiscal year 2012 under the final rule will increase relative to fiscal year 2011 by approximately $126 million, or 2.5%, due to area wage adjustments, as well as increases in high-cost and short-stay outlier payments and other policies adopted in the final rule.

We are currently analyzing the financial implications of the final rule issued by CMS on the operators of our long-term acute care hospitals. We cannot assure you that this rule or future updates to LTAC PPS or Medicare reimbursement for long-term acute care hospitals will not materially adversely affect our operators, which, in turn, could have a material adverse effect on our business, financial condition, results of operations and liquidity, on our ability to service our indebtedness and other obligations and on our ability to make distributions to our stockholders, as required for us to continue to qualify as a REIT (a “Material Adverse Effect”).

Medicare Reimbursement: Skilled Nursing Facilities

On July 29, 2011, CMS put on public display for August 8, 2011 publication its final rule updating the prospective payment system for skilled nursing facilities (SNF PPS) for the 2012 fiscal year (October 1, 2011 through September 30, 2012). Under the final rule, the update to the SNF PPS standard federal payment rate includes a 2.7% increase in the market basket index, less a1.0% productivity adjustment mandated by the Affordable Care Act and a 12.6% “parity adjustment recalibration” to account for estimated overpayments under the RUG-IV classification model, resulting in a net 11.1% decrease in the SNF PPS standard federal payment rate for fiscal year 2012. The final rule also requires group therapy to be treated in the same manner as concurrent therapy (i.e., allocating therapy minutes among the group’s patients, rather than counting the same minutes for each patient), which may additionally affect net payments to skilled nursing facilities. CMS estimates that net payments to skilled nursing facilities as a result of the final rule will decrease by approximately $3.87 billion in fiscal year 2012. However, CMS has stated that “Even with the recalibration, the FY 2012 payment rates will be 3.4 percent higher than the rates established for FY 2010, the period immediately preceding the unintended spike in payment levels.”

We are currently analyzing the financial implications of the final rule issued by CMS on the operators of our skilled nursing facilities. We cannot assure you that this rule or future updates to SNF PPS or Medicare reimbursement for skilled nursing facilities will not materially adversely affect our operators, which, in turn, could have a Material Adverse Effect on us.

Debt Ceiling and Deficit Reduction Legislation

On August 2, 2011, President Obama and the U.S. Congress enacted legislation to lift the federal government’s borrowing authority (the so-called “debt ceiling”) and reduce the federal government’s projected operating deficit. To implement this legislation, President Obama and members of the U.S. Congress have proposed various spending cuts and tax reform initiatives, some of which could result in changes (including substantial reductions in funding) to Medicare, Medicaid or Medicare Advantage Plans. Under the agreement reached to allow the federal government to raise the debt ceiling in August, a twelve-member, bipartisan committee has been given a deadline of November 23, 2011 to develop recommendations for reducing the federal budget deficit by a total of at least $1.2 trillion over ten years. If the committee cannot agree on a plan, or if the U.S. Congress does not enact the committee’s recommendations by December 23, 2011, $1.2 trillion in automatic spending cuts, including potential reductions in Medicare provider payments, could take effect beginning in January 2013. These measures and any future federal legislation relating to the debt ceiling or deficit reduction could have a material adverse effect on our operators’ liquidity, financial condition or results of operations, which could adversely affect their ability to satisfy their obligations to us and which, in turn, could have a Material Adverse Effect on us.

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Medicaid Reimbursement: Skilled Nursing Facilities

In an effort to address their own budget shortfalls, many state legislatures have proposed or enacted widespread changes to their Medicaid programs that are anticipated to reduce future payments to healthcare providers, including skilled nursing facility operators. At this time, we cannot predict the impact such changes will have on our skilled nursing facility operators, nor can we predict whether significant Medicaid rate freezes, cuts or other program changes will be adopted by other states in the future. Severe and widespread rate cuts or freezes could adversely affect our skilled nursing facility operators’ ability to satisfy their obligations to us and, in turn, could have a Material Adverse Effect on us.

Critical Accounting Policies and Estimates

Our Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form 10-Q have been prepared in accordance with GAAP for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”). GAAP requires us to make estimates and assumptions about future events that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We base these estimates on our experience and on various other assumptions we believe to be reasonable under the circumstances. However, if our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, a different accounting treatment may have been applied, resulting in a different presentation of our financial statements. We periodically reevaluate our estimates and assumptions, and in the event they prove to be different from actual results, we make adjustments in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. In addition to the policies outlined below, please refer to our Annual Report on Form 10-K for the year ended December 31, 2010, filed with the SEC on February 18, 2011, for further information regarding the critical accounting policies that affect our more significant estimates and assumptions used in the preparation of our Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form 10-Q.

Business Combinations

We account for acquisitions using the acquisition method and allocate the cost of the properties acquired among tangible and recognized intangible assets and liabilities based upon their estimated fair values as of the acquisition date. Recognized intangibles primarily include the value of in-place leases, acquired lease contracts, tenant and customer relationships, trade names/trademarks and goodwill. We do not amortize goodwill, which is included in other assets on our Consolidated Balance Sheets and represents the excess of the purchase price paid over the fair value of the net assets of the acquired business.

Our method for allocating the purchase price paid to acquire investments in real estate requires us to make subjective assessments for determining fair value of the assets acquired and liabilities assumed. This includes determining the value of the buildings and improvements, land and improvements, ground leases, tenant improvements, in-place leases, above and/or below market leases and any debt assumed. These estimates require significant judgment and in some cases involve complex calculations. These allocation assessments directly impact our results of operations, as amounts allocated to certain assets and liabilities have different depreciation or amortization lives. In addition, we amortize the value assigned to above and/or below market leases as a component of revenue, unlike in-place leases and other intangibles, which we include in depreciation and amortization in our Consolidated Statements of Income.

We estimate the fair value of buildings acquired on an as-if-vacant basis and depreciate the building value over the estimated remaining life of the building. We determine the allocated value of other fixed assets, such as site improvements and furniture, fixtures and equipment, based upon the replacement cost and depreciate such value over the assets’ estimated remaining useful lives. We determine the value of land by considering the sales prices of similar properties in recent transactions or based on (i) internal analyses of recently acquired and existing comparable properties within our portfolio or (ii) real estate tax assessed values in relation to the total value of the asset. The fair value of acquired lease intangibles, if any, reflects (i) the estimated value of any above and/or below market leases, determined by discounting the difference between the estimated market rent and the in-place lease rent, the resulting intangible asset or liability of which is amortized to revenue over the remaining life of the associated lease plus any bargain renewal periods, and (ii) the estimated value of in-place leases related to the cost to obtain tenants, including tenant allowances, tenant improvements and leasing commissions, and an estimated value of the absorption period to reflect the value of the rent and recovery costs foregone during a reasonable lease-up period, as if the acquired space was vacant, which is amortized to amortization expense over the remaining life of the associated lease. We estimate the fair value of tenant or other customer relationships acquired, if any, by considering the nature and extent of existing business relationships with the tenant or customer, growth prospects for developing new business with the tenant or customer, the tenant’s credit quality, expectations of lease renewals with the tenant, and the potential for significant, additional future leasing arrangements with the tenant and amortize that value over the expected life of the associated arrangements or leases, including the remaining terms of the related leases and any expected renewal periods. We estimate the fair value of trade names/trademarks using a royalty rate methodology and amortize the value over the estimated useful life of the trade name/trademark.

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In connection with a business combination, we may assume the rights and obligations under certain lease agreements pursuant to which we become the lessee of a given property. We assume the lease classification previously determined by the prior lessee absent a modification in the assumed lease agreement. In connection with our recent acquisitions, all capital leases acquired or assumed contain bargain purchase options that we intend to exercise. Therefore, we recognized an asset based on the acquisition date fair value of the underlying property and a liability based on the acquisition date fair value of the capital lease obligation. Such assets recognized under capital leases that contain bargain purchase options are depreciated over the asset’s useful life. We assess assumed operating leases, including ground leases, to determine if the lease terms are favorable or unfavorable given current market conditions on the acquisition date. To the extent the lease arrangement is favorable or unfavorable relative to market conditions on the acquisition date, we recognize an intangible asset or liability at fair value. The recognized asset or liability (excluding purchase option intangibles) for these leases is amortized to interest or rental expense over the applicable lease term and is included in our Consolidated Statements of Income. All lease-related intangible assets are included within acquired lease intangibles and all lease-related intangible liabilities are included within accounts payable and other liabilities on our Consolidated Balance Sheets.

For loans receivable acquired in connection with a business combination, we determine fair value by discounting the estimated future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The estimated future cash flows reflect our judgment regarding the uncertainty of those cash flows and, therefore, we do not establish a valuation allowance at the acquisition date. The difference between the acquisition date fair value and the total expected cash flows is recognized as interest income using an effective interest method over the life of the applicable loan. Subsequent to the acquisition date, we evaluate changes regarding the uncertainty of future cash flows and the need for a valuation allowance.

We calculate the fair value of long-term debt by discounting the remaining contractual cash flows on each instrument at the current market rate for those borrowings, which we approximate based on the rate we would expect to incur to replace the instrument on the date of acquisition, and recognize any fair value adjustments related to long-term debt as effective yield adjustments over the remaining term of the instrument.

We record a liability for contingent consideration at fair value as of the acquisition date (which is included in accounts payable and other liabilities on our Consolidated Balance Sheets) and reassess the fair value at the end of each reporting period, with any change being recognized in earnings. Increases or decreases in the fair value of the contingent consideration can result from changes in discount periods, discount rates and probabilities that contingencies will be met.

Fair Value

We follow FASB guidance that defines fair value and provides direction for measuring fair value and making the necessary related disclosures. The guidance emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels one and two of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within level three of the hierarchy).

Level one inputs utilize unadjusted quoted prices for identical assets or liabilities in active markets that the reporting entity has the ability to access. Level two inputs are inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets, as well as other inputs for the asset or liability, such as interest rates, foreign exchange rates and yield curves, that are observable at commonly quoted intervals. Level three inputs are unobservable inputs for the asset or liability, which are typically based on the reporting entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the hierarchy, the level within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. If an entity determines there has been a significant decrease in the volume and level of activity for an asset or liability relative to the normal market activity for such asset or liability (or similar assets or liabilities), then transactions or quoted prices may not accurately reflect fair value. In addition, if there is evidence that the transaction for the asset or liability is not orderly, the entity shall place little, if any, weight on that transaction price as an indicator of fair value. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

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Recently Issued or Adopted Accounting Standards

In September 2011, the FASB issued Accounting Standards Update (“ASU”) 2011-08, Testing Goodwill for Impairment (“ASU 2011-08”), which permits companies to first assess qualitative factors to determine the likelihood that the fair value of a reporting unit is less than its carrying amount, before performing the current two-step analysis. If a company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the company must proceed with the two-step approach to evaluating impairment. The provisions of ASU 2011-08 will be effective for us beginning with the first quarter of 2012, but we do not expect ASU 2011-08 to have a significant impact on our Consolidated Financial Statements. Also, on January 1, 2011, we adopted ASU 2010-28, When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts (“ASU 2010-28”). ASU 2010-28 states that if a reporting unit has a carrying amount that is equal to or less than zero and there are qualitative factors that indicate it is more likely than not that a goodwill impairment exists, Step 2 of the goodwill impairment test must be performed. The adoption of ASU 2010-28 did not impact our Consolidated Financial Statements.

In June 2011, the FASB issued ASU 2011-05, Presentation of Comprehensive Income (“ASU 2011-05”), which amends current guidance found in ASC Topic 220, Comprehensive Income. ASU 2011-05 requires entities to present comprehensive income in either: (i) one continuous financial statement or (ii) two separate but consecutive statements that display net income and the components of other comprehensive income. Totals and individual components of both net income and other comprehensive income must be included in either presentation. The provisions of ASU 2011-05 will be effective for us beginning with the first quarter of 2012.

On January 1, 2011, we adopted ASU 2010-29, Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations (“ASU 2010-29”), affecting public entities who enter into business combinations that are material on an individual or aggregate basis. ASU 2010-29 specifies that a public entity presenting comparative financial statements should disclose revenues and earnings of the combined entity as though the business combination(s) that occurred during the year had occurred at the beginning of the prior annual reporting period when preparing the pro forma financial information for both the current and prior reporting periods. This guidance, which is effective for business combinations consummated in reporting periods beginning after December 15, 2010, also requires that pro forma disclosures be accompanied by a narrative description regarding the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination(s) included in reported pro forma revenues and earnings. We have presented supplementary pro forma information related to our acquisition of substantially all of the real estate assets and working capital of Atria Senior Living in May 2011 and our acquisition of NHP in July 2011 in “Note 4—Acquisitions of Real Estate Property” of the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form 10-Q.

In January 2010, the FASB issued ASU 2010-06, Improving Disclosures about Fair Value Measurements (“ASU 2010-06”), which expands required disclosures related to an entity’s fair value measurements. Certain provisions of ASU 2010-06 are effective for interim and annual reporting periods beginning after December 15, 2009, and we adopted those provisions as of January 1, 2010. The remaining provisions, which are effective for interim and annual reporting periods beginning after December 15, 2010, require additional disclosures related to purchases, sales, issuances and settlements in an entity’s reconciliation of recurring level three investments. We adopted those provisions of ASU 2010-06 as of January 1, 2011. The adoption of ASU 2010-06 did not impact our Consolidated Financial Statements.

Results of Operations

As of September 30, 2011, we operated through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. Our triple-net leased properties segment consists of acquiring and owning seniors housing and healthcare properties in the United States and leasing those properties to healthcare operating companies under “triple-net” or “absolute-net” leases, which require the tenants to pay all property-related expenses. Our senior living operations segment consists of investments in seniors housing communities located in the United States and Canada for which we engage independent third parties, such as Sunrise and Atria, to manage the operations. Our MOB operations segment primarily consists of acquiring, owning, developing, leasing and managing MOBs. Information provided for “all other” includes revenues such as income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to our three reportable business segments. Assets included in all other consist primarily of corporate assets, including cash, restricted cash, deferred financing costs, loans receivable and miscellaneous accounts receivable.

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Three Months Ended September 30, 2011 and 2010

The table below shows our results of operations for the three months ended September 30, 2011 and 2010 and the effect on our income of changes in those results from period to period.

	For the Three Months						Increase (Decrease)
	Ended September 30,						to Income
	2011			2010			$			%
	(Dollars in thousands)
Segment NOI:
Triple-Net Leased Properties	$	212,588		$	117,906		$	94,682			80.3	%
Senior Living Operations		87,508			39,116			48,392			> 100
MOB Operations		39,908			16,954			22,954			> 100
All Other		10,072			4,014			6,058			> 100
Total segment NOI		350,076			177,990			172,086			96.7
Interest and other income		373			35			338			> 100
Interest expense		(73,756	)		(45,519	)		(28,237	)		(62.0	)
Depreciation and amortization		(161,027	)		(52,104	)		(108,923	)		( > 100	)
General, administrative and professional fees		(20,624	)		(15,278	)		(5,346	)		(35.0	)
Loss on extinguishment of debt		(8,685	)		—			(8,685	)	nm
Litigation proceeds, net		85,327			—			85,327		nm
Merger-related expenses and deal costs		(69,350	)		(5,142	)		(64,208	)		( > 100	)
Other		(14,436	)		419			(14,855	)		( > 100	)
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		87,898			60,401			27,497			45.5
Income (loss) from unconsolidated entities		182			(392	)		574			> 100
Income tax benefit (expense)		13,904			(1,657	)		15,561			> 100
Income from continuing operations		101,984			58,352			43,632			74.8
Discontinued operations		—			542			(542	)	nm
Net income		101,984			58,894			43,090			73.2
Net (loss) income attributable to noncontrolling interest, net of tax		(901	)		996			1,897			> 100
Net income attributable to common stockholders	$	102,885		$	57,898		$	44,987			77.7	%

nm — not meaningful

Segment NOI — Triple-Net Leased Properties

NOI for our triple-net leased properties reportable segment consists of rental income earned from these assets and other services revenue. We incur no direct operating expenses for this segment.

The increase in our triple-net leased properties reportable segment NOI for the three months ended September 30, 2011 over the same period in 2010 is attributed primarily to the properties we acquired in the NHP acquisition, $1.6 million of additional rent resulting from the annual escalators in the rent paid under our four master lease agreements with Kindred (the “Kindred Master Leases”) effective May 1, 2011, other services revenue directly attributable to the properties acquired in the NHP acquisition ($1.1 million), and various escalations in the rent paid on our other existing triple-net leased properties.

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Revenues related to our triple-net leased properties consist of fixed rental amounts (subject to annual escalations) received directly from our tenants based on the terms of the applicable leases and generally do not depend on the operating performance of our properties. Accordingly, occupancy information is relevant to the profitability of our tenants’ operations but does not directly impact our revenues or financial results. Average occupancy rates related to triple-net leased properties we owned at September 30, 2011, for the second quarter of 2011, which is the most recent information available to us from our tenants, are shown below.

	Number of		Average Occupancy
	Properties at		For the Three Months
	September 30, 2011		Ended June 30, 2011
Seniors Housing Communities		454		85.7	%
Skilled Nursing Facilities		384		82.4	%
Hospitals		47		58.1	%

Segment NOI — Senior Living Operations

A summary of our senior living operations reportable segment NOI is as follows:

	For the Three Months						Increase (Decrease)
	Ended September 30,						to Income
	2011			2010			$			%
	(Dollars in thousands)
Segment NOI — Senior Living Operations:
Total revenues	$	276,364		$	113,182		$	163,182			> 100	%
Less:
Property-level operating expenses		(188,856	)		(74,066	)		(114,790	)		( > 100	)
Segment NOI	$	87,508		$	39,116		$	48,392			> 100	%

Revenues related to our senior living operations reportable segment are resident fees and services, which include all amounts earned from residents at our seniors housing communities, such as rental fees related to resident leases, extended health care fees and other ancillary service income. The increase in our senior living operations reportable segment revenues for the three months ended September 30, 2011 over the same period in 2010 is attributed primarily to the properties we acquired in the Atria Senior Living acquisition, an increase in average daily rates and a decrease in the average Canadian dollar exchange rate. Average occupancy rates related to our senior living operations reportable segment during the three months ended September 30, 2011 and 2010 were as follows:

					Average Occupancy
	Number of Properties				For the Three Months
	at September 30,				Ended September 30,
	2011		2010		2011			2010
Stabilized Communities		192		80		88.9	%		89.4	%
Lease-Up Communities		7		2		74.7	%		78.1	%
Total		199		82		88.4	%		88.9	%
Same-Store Stabilized Communities		80		80		90.3	%		89.4	%

Property-level operating expenses related to our senior living operations reportable segment include labor, food, utility, marketing, management and other property operating costs. Property-level operating expenses increased for the three months ended September 30, 2011 over the same period in 2010 primarily due to the properties we acquired in the Atria Senior Living acquisition and a decrease in the average Canadian dollar exchange rate, partially offset by a decrease in the management fees related to our seniors housing communities managed by Sunrise.

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Segment NOI — MOB Operations

A summary of our MOB operations reportable segment NOI is as follows:

	For the Three Months						Increase (Decrease)
	Ended September 30,						to Income
	2011			2010			$			%
	(Dollars in thousands)
Segment NOI — MOB Operations:
Rental income	$	58,398		$	22,817		$	35,581			> 100	%
Medical office building services revenue		8,162			6,711			1,451			21.6
Total revenues		66,560			29,528			37,032			> 100
Less:
Property-level operating expenses		(20,305	)		(7,941	)		(12,364	)		( > 100	)
Medical office building services costs		(6,347	)		(4,633	)		(1,714	)		(37.0	)
Segment NOI	$	39,908		$	16,954		$	22,954			> 100	%

nm — not meaningful

MOB operations reportable segment revenues and property-level operating expenses both increased for the three months ended September 30, 2011 over the same period in 2010 primarily due to the additional MOBs we acquired in the NHP acquisition. Occupancy rates related to our MOB operations reportable segment at September 30, 2011 and 2010 were as follows:

	Number of Properties
	at September 30,				Occupancy at September 30,
	2011		2010		2011			2010
Stabilized MOBs		169		57		91.6	%		94.4	%
Non-Stabilized MOBs		8		7		73.6	%		73.8	%
Total		177		64		89.8	%		90.4	%
Same-Store Stabilized MOBs		57		57		93.5	%		94.4	%

Medical office building services revenue and costs both increased for the three months ended September 30, 2011 over the same period in 2010 due to increased construction activity during 2011.

Segment NOI — All Other

All other NOI for the three months ended September 30, 2011 and 2010 consists solely of income from loans and investments. Income from loans and investments increased for the three months ended September 30, 2011 over the same period in 2010 due primarily to the loans receivable we acquired in the NHP acquisition, partially offset by decreased interest income related to loans receivable repayments we received subsequent to September 30, 2010.

Interest Expense

Total interest expense, including interest allocated to discontinued operations of $0 million and $0.2 million for the three months ended September 30, 2011 and 2010, respectively, increased $28.0 million for the three months ended September 30, 2011 over the same period in 2010. This difference is attributed primarily to a $49.5 million increase in interest due to higher loan balances and $2.2 million of interest related to capital leases due to acquisition activity, partially offset by a $25.1 million decrease in interest due to lower effective interest rates. Our effective interest rate, excluding activity related to our capital leases, was 4.5% for the three months ended September 30, 2011, compared to 6.3% for the same period in 2010. A decrease in the average Canadian dollar exchange rate had an unfavorable impact on interest expense of $0.1 million for the three months ended September 30, 2011, compared to the same period in 2010.

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Depreciation and Amortization

Depreciation and amortization increased $108.9 million for the three months ended September 30, 2011 over the same period in 2010 due primarily to the properties we acquired in the Atria Senior Living and NHP transactions.

General, Administrative and Professional Fees

General, administrative and professional fees increased $5.3 million for the three months ended September 30, 2011 over the same period in 2010 due primarily to our enterprise growth.

Loss on Extinguishment of Debt

The loss on extinguishment of debt for the three months ended September 30, 2011 relates solely to our redemption in July 2011 of $200.0 million principal amount of our 6¹/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. No similar transactions occurred during the three months ended September 30, 2010.

Litigation Proceeds, Net

Litigation proceeds, net for the three months ended September 30, 2011 reflects our receipt of $102.8 million in payment of the compensatory damages award from HCP, Inc. (“HCP”) arising out of our 2007 Sunrise Senior Living REIT acquisition, plus certain costs and interest, net of certain expenses and the contribution of $3 million to the Ventas Charitable Foundation. No similar transactions occurred during the three months ended September 30, 2010.

Merger-Related Expenses and Deal Costs

Merger-related expenses and deal costs for the three months ended September 30, 2011 and 2010 consisted of certain expenses relating to our favorable $101.6 million compensatory damages judgment against HCP and subsequent cross-appeals, transition and integration expenses related to consummated transactions and deal costs required by GAAP to be expensed rather than capitalized into the asset value. The transition and integration expenses and deal costs primarily consisted of certain fees and expenses incurred in connection with our Lillibridge, Atria Senior Living and NHP acquisitions.

Other

Other consists primarily of the fair value adjustment on interest rate swaps we acquired in connection with the Atria Senior Living and NHP acquisitions, partially offset by other expenses.

Income/Loss from Unconsolidated Entities

Income/loss from unconsolidated entities for the three months ended September 30, 2011 and 2010 relates to our noncontrolling interests in joint ventures we acquired as part of the NHP and Lillibridge acquisitions. At September 30, 2011, our ownership interests in these joint ventures, which comprised 58 MOBs, 20 seniors housing communities and fourteen skilled nursing facilities, ranged between 5% and 25%.

Income Tax Benefit/Expense

Income tax benefit for the three months ended September 30, 2011 was due primarily to the reduction of certain income tax contingency reserves, including interest, related to our 2007 U.S. federal income tax returns. Income tax expense for the three months ended September 30, 2010 represents amounts related to our taxable REIT subsidiaries as a result of the Sunrise Senior Living REIT acquisition.

Discontinued Operations

We had no assets classified as discontinued operations for the three months ended September 30, 2011. Discontinued operations for the three months ended September 30, 2010 includes the operations of two assets sold during 2010.

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Net Loss/Income Attributable to Noncontrolling Interest, Net of Tax

Net loss/income attributable to noncontrolling interest for the three months ended September 30, 2011 represents our partners’ joint venture interests in eleven MOBs and eighteen seniors housing communities. Net income attributable to noncontrolling interest, net of tax for the three months ended September 30, 2010 represents Sunrise’s share of net income from its previous ownership interests in 60 of our seniors housing communities, which we acquired during 2010, and our partners’ joint venture interests in six MOBs.

Nine Months Ended September 30, 2011 and 2010

The table below shows our results of operations for the nine months ended September 30, 2011 and 2010 and the effect on our income of changes in those results from period to period.

	For the Nine Months						Increase (Decrease) to
	Ended September 30,						Income
	2011			2010			$			%
	(Dollars in thousands)
Segment NOI:
Triple-Net Leased Properties	$	451,320		$	351,625		$	99,695			28.4	%
Senior Living Operations		189,642			111,733			77,909			69.7
MOB Operations		74,237			33,057			41,180			> 100
All Other		24,548			11,336			13,212			> 100
Total segment NOI		739,747			507,751			231,996			45.7
Interest and other income		529			420			109			26.0
Interest expense		(170,046	)		(133,449	)		(36,597	)		(27.4	)
Depreciation and amortization		(293,541	)		(154,458	)		(139,083	)		(90.0	)
General, administrative and professional fees		(51,010	)		(35,819	)		(15,191	)		(42.4	)
Loss on extinguishment of debt		(25,211	)		(6,549	)		(18,662	)		( > 100	)
Litigation proceeds, net		85,327			—			85,327		nm
Merger-related expenses and deal costs		(131,606	)		(11,668	)		(119,938	)		( > 100	)
Other		(6,664	)		404			(7,068	)		( > 100	)
Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		147,525			166,632			(19,107	)		(11.5	)
Loss from unconsolidated entities		(71	)		(392	)		321			81.9
Income tax benefit (expense)		23,310			(2,352	)		25,662			> 100
Income from continuing operations		170,764			163,888			6,876			4.2
Discontinued operations		—			7,139			(7,139	)	nm
Net income		170,764			171,027			(263	)		(0.2	)
Net (loss) income attributable to noncontrolling interest, net of tax		(781	)		2,443			3,224			> 100
Net income attributable to common stockholders	$	171,545		$	168,584		$	2,961			1.8	%

nm — not meaningful

Segment NOI — Triple-Net Leased Properties

The increase in our triple-net leased properties reportable segment NOI for the nine months ended September 30, 2011 over the same period in 2010 is attributed primarily to the properties we acquired in the NHP acquisition, $2.7 million of additional rent resulting from the annual escalators in the rent paid under the Kindred Master Leases effective May 1, 2011, other services revenue directly attributable to the properties acquired in the NHP acquisition ($1.1 million), and various escalations in the rent paid on our other existing triple-net leased properties.

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Segment NOI — Senior Living Operations

A summary of our senior living operations reportable segment NOI is as follows:

	For the Nine Months						Increase (Decrease)
	Ended September 30,						to Income
	2011			2010			$			%
	(Dollars in thousands)
Segment NOI — Senior Living Operations:
Total revenues	$	593,348		$	331,535		$	261,813			79.0	%
Less:
Property-level operating expenses		(403,706	)		(219,802	)		(183,904	)		(83.7	)
Segment NOI	$	189,642		$	111,733		$	77,909			69.7	%

The increase in senior living operations reportable segment revenues for the nine months ended September 30, 2011 over the same period in 2010 is attributed primarily to the properties we acquired in the Atria Senior Living acquisition on May 12, 2011, an increase in average daily rates and a decrease in the average Canadian dollar exchange rate. Average occupancy rates related to our senior living operations reportable segment during the nine months ended September 30, 2011 and 2010 were as follows:

	Number of Properties				Average Occupancy
	at September 30,				For the Nine Months Ended September 30,
	2011		2010		2011 (1)			2010
Stabilized Communities		192		80		88.9	%		88.8	%
Lease-Up Communities		7		2		72.6	%		82.6	%
Total		199		82		88.4	%		88.6	%
Same-Store Stabilized Communities		79		79		89.7	%		88.8	%

(1) Occupancy related to the seniors housing communities acquired in connection with the Atria Senior Living acquisition reflects activity from May 12, 2011, the date of the acquisition, through September 30, 2011.

Property-level operating expenses increased for the nine months ended September 30, 2011 over the same period in 2010 primarily due to the properties we acquired in the Atria Senior Living acquisition and a decrease in the average Canadian dollar exchange rate, partially offset by a decrease in the management fees related to our seniors housing communities managed by Sunrise.

Segment NOI — MOB Operations

A summary of our MOB operations reportable segment NOI is as follows:

	For the Nine Months						Increase (Decrease)
	Ended September 30,						to Income
	2011			2010			$			%
	(Dollars in thousands)
Segment NOI — MOB Operations:
Rental income	$	106,392		$	47,246		$	59,146			> 100	%
Medical office building services revenue		24,941			6,711			18,230			> 100
Total revenues		131,333			53,957			77,376			> 100
Less:
Property-level operating expenses		(37,259	)		(16,267	)		(20,992	)		( > 100	)
Medical office building services costs		(19,837	)		(4,633	)		(15,204	)		( > 100	)
Segment NOI	$	74,237		$	33,057		$	41,180			> 100	%

nm — not meaningful

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MOB operations reportable segment revenues and property-level operating expenses both increased for the nine months ended September 30, 2011 over the same period in 2010 primarily due to the additional MOBs we acquired as part of the NHP and Lillibridge acquisitions.

Medical office building services revenue and costs both increased for the nine months ended September 30, 2011 over the same period in 2010 due to increased construction activity during 2011.

Segment NOI — All Other

All other NOI for the nine months ended September 30, 2011 and 2010 consists solely of income from loans and investments. Income from loans and investments increased for the nine months ended June 30, 2011 over the same period in 2010 due primarily to the loans receivable we acquired in the NHP acquisition and additional investments we made in loans receivable during 2010 and 2011, partially offset by decreased interest income related to loans receivable repayments we received subsequent to September 30, 2010.

Interest Expense

Total interest expense, including interest allocated to discontinued operations of $0 million and $0.9 million for the nine months ended September 30, 2011 and 2010, respectively, increased $35.7 million for the nine months ended September 30, 2011 over the same period in 2010. This difference is attributed primarily to a $67.6 million increase in interest due to higher loan balances and $5.4 million of interest related to the capital leases due to acquisition activity, partially offset by a $39.1 million decrease in interest due to lower effective interest rates. Our effective interest rate, excluding activity related to our capital leases, was 5.1% for the nine months ended September 30, 2011, compared to 6.5% for the same period in 2010. A decrease in the average Canadian dollar exchange rate had an unfavorable impact on interest expense of $0.2 million for the nine months ended September 30, 2011, compared to the same period in 2010.

Depreciation and Amortization

Depreciation and amortization increased $139.1 million for the nine months ended September 30, 2011 over the same period in 2010 due primarily to the properties we acquired in the NHP and Atria Senior Living transactions.

General, Administrative and Professional Fees

General, administrative and professional fees increased $15.2 million for the nine months ended September 30, 2011 over the same period in 2010 due primarily to our enterprise growth.

Loss on Extinguishment of Debt

The loss on extinguishment of debt for the nine months ended September 30, 2011 relates primarily to our early repayment of $307.2 million principal amount of existing mortgage debt in February 2011 and our redemption in July 2011 of $200.0 million principal amount of our 6¹/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. The loss on extinguishment of debt for the nine months ended September 30, 2010 relates primarily to our redemption in June 2010 of all $142.7 million principal amount then outstanding of our 7¹/8% senior notes due 2015, at a redemption price equal to 103.56% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes.

Litigation Proceeds, Net

Litigation proceeds, net for the nine months ended September 30, 2011 reflects our receipt of $102.8 million in payment of the compensatory damages award from HCP arising out of our 2007 Sunrise Senior Living REIT acquisition, plus certain costs and interest, net of certain expenses and the contribution of $3 million to the Ventas Charitable Foundation. No similar transactions occurred during the nine months ended September 30, 2010.

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Merger-Related Expenses and Deal Costs

Merger-related expenses and deal costs for the nine months ended September 30, 2011 and 2010 consisted of certain expenses relating to our favorable $101.6 million compensatory damages judgment against HCP and subsequent cross-appeals, transition and integration expenses related to consummated transactions and deal costs required by GAAP to be expensed rather than capitalized into the asset value. The transition and integration expenses and deal costs primarily consist of certain fees and expenses incurred in connection with our Lillibridge, Atria Senior Living and NHP acquisitions.

Other

Other consists primarily of the fair value adjustment on interest rate swaps we acquired in connection with the Atria Senior Living and NHP acquisitions, partially offset by other expenses.

Loss from Unconsolidated Entities

Loss from unconsolidated entities for the nine months ended September 30, 2011 and 2010 relates to our noncontrolling interests in joint ventures we acquired as part of the NHP and Lillibridge acquisitions. At September 30, 2011, our ownership interests in these joint ventures, which comprised 58 MOBs, 20 seniors housing communities and fourteen skilled nursing facilities, ranged between 5% and 25%.

Income Tax Benefit/Expense

Income tax benefit for the nine months ended September 30, 2011 was due primarily to the reduction of certain income tax contingency reserves, including interest, related to our 2007 U.S. federal income tax returns. Income tax expense for the nine months ended September 30, 2010 represents amounts related to our taxable REIT subsidiaries as a result of the Sunrise Senior Living REIT acquisition.

Discontinued Operations

We had no assets classified as discontinued operations for the nine months ended September 30, 2011. Discontinued operations for the nine months ended September 30, 2010 includes the operations of six assets sold during 2010.

Net Loss/Income Attributable to Noncontrolling Interest, Net of Tax

Net loss attributable to noncontrolling interest for the nine months ended September 30, 2011 represents our partners’ joint venture interests in eleven MOBs and eighteen seniors housing communities. We acquired 23 of these properties in connection with the NHP acquisition. Net income attributable to noncontrolling interest, net of tax for the nine months ended September 30, 2010 represents Sunrise’s share of net income from its previous ownership interests in 60 of our seniors housing communities, which we acquired during 2010, and our partners’ joint venture interests in six MOBs.

Non-GAAP Financial Measures

We believe that net income, as defined by GAAP, is the most appropriate earnings measurement. However, we consider certain non-GAAP financial measures to be useful supplemental measures of our operating performance. A non-GAAP financial measure is generally defined as one that purports to measure historical or future financial performance, financial position or cash flows, but excludes or includes amounts that would not be so adjusted in the most comparable GAAP measure. Set forth below are descriptions of the non-GAAP financial measures we consider relevant to our business and useful to investors, as well as reconciliations of these measures to our most directly comparable GAAP financial measures.

The non-GAAP financial measures we present herein are not necessarily identical to those presented by other real estate companies due to the fact that not all real estate companies use the same definitions. These measures should not be considered as alternatives to net income (determined in accordance with GAAP) as indicators of our financial performance or as alternatives to cash flow from operating activities (determined in accordance with GAAP) as measures of our liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs. We believe that in order to facilitate a clear understanding of our consolidated historical operating results, these measures should be examined in conjunction with net income as presented in our Consolidated Financial Statements and data included elsewhere in this Quarterly Report on Form 10-Q.

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Funds From Operations and Normalized Funds From Operations

Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values, instead, have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. To overcome this problem, we consider Funds From Operations (“FFO”) and normalized FFO appropriate measures of operating performance of an equity REIT. Moreover, we believe that normalized FFO provides useful information because it allows investors, analysts and our management to compare our operating performance to the operating performance of other real estate companies and between periods on a consistent basis without having to account for differences caused by unanticipated items. We use the National Association of Real Estate Investment Trusts (“NAREIT”) definition of FFO. NAREIT defines FFO as net income (computed in accordance with GAAP), excluding gains (or losses) from sales of real estate property, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis. We define normalized FFO as FFO excluding the following income and expense items (which may be recurring in nature): (a) gains and losses on the sales of real property assets; (b) merger-related costs and expenses, including amortization of intangibles and transition and integration expenses, and deal costs and expenses, including expenses and recoveries relating to our lawsuit against HCP, Inc. and the issuance of preferred stock or bridge loan fees; (c) the impact of any expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees, or additional costs, expenses, discounts, make-whole payments, penalties or premiums incurred as a result of early debt retirement or payment of our debt; (d) the non-cash effect of income tax benefits or expenses; (e) the impact of future unannounced acquisitions or divestitures (including pursuant to tenant options to purchase) and capital transactions; (f) the reversal or incurrence of contingent consideration; (g) charitable donations made to the Ventas Charitable Foundation; and (h) gains and losses for non-operational foreign currency hedge agreements and changes in the fair value of financial instruments.

Our FFO and normalized FFO for the three and nine months ended September 30, 2011 and 2010 are summarized in the following table.

	For the Three Months						For the Nine Months
	Ended September 30,						Ended September 30,
	2011			2010			2011			2010
	(In thousands)
Net income attributable to common stockholders	$	102,885		$	57,898		$	171,545		$	168,584
Adjustments:
Real estate depreciation and amortization		160,403			51,449			291,748			153,321
Real estate depreciation related to noncontrolling interest		(1,313	)		(1,627	)		(1,727	)		(5,033	)
Real estate depreciation related to unconsolidated entities		2,247			1,275			4,213			1,275
Discontinued operations:
Gain on sale of real estate assets		—			(168	)		—			(5,393	)
Depreciation on real estate assets		—			96			—			464
FFO		264,222			108,923			465,779			313,218
Adjustments:
Income tax (benefit) expense		(13,904	)		1,044			(23,310	)		761
Loss on extinguishment of debt		8,685			—			25,211			6,549
Litigation proceeds, net		(85,327	)		—			(85,327	)		—
Merger-related expenses and deal costs		69,350			5,142			131,606			11,668
Amortization of other intangibles		256			338			767			338
Change in fair value of financial instruments		11,785			—			2,898			—
Normalized FFO	$	255,067		$	115,447		$	517,624		$	332,534

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Adjusted EBITDA

We consider Adjusted EBITDA an important supplemental measure to net income because it provides additional information with which to evaluate the performance of our operations and serves as another indication of our ability to service debt. We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization (including non-cash stock-based compensation expense), excluding net litigation proceeds, merger-related expenses and deal costs, gains or losses on sales of real property assets and changes in the fair value of financial instruments (including amounts in discontinued operations). The following is a reconciliation of Adjusted EBITDA to net income (including amounts in discontinued operations) for the three and nine months ended September 30, 2011 and 2010:

	For the Three Months						For the Nine Months
	Ended September 30,						Ended September 30,
	2011			2010			2011			2010
	(In thousands)
Net income	$	101,984		$	58,894		$	170,764		$	171,027
Adjustments:
Interest		73,756			45,731			170,046			134,362
Loss on extinguishment of debt		8,685			—			25,211			6,549
Taxes (including amounts in general, administrative and professional fees)		(13,116	)		1,907			(21,937	)		3,102
Depreciation and amortization		161,027			52,200			293,541			154,922
Non-cash stock-based compensation expense		5,228			4,039			13,596			10,128
Litigation proceeds, net		(85,327	)		—			(85,327	)		—
Merger-related expenses and deal costs		69,350			5,142			131,606			11,668
Gain on sale of real property assets		—			(168	)		—			(5,393	)
Change in fair value of financial instruments		11,785			—			2,898			—
Adjusted EBITDA	$	333,372		$	167,745		$	700,398		$	486,365

NOI

We consider NOI an important supplemental measure to net income because it allows investors, analysts and our management to measure unlevered property-level operating results and to compare our operating results to the operating results of other real estate companies and between periods on a consistent basis. We define NOI as total revenues, excluding interest and other income, less property-level operating expenses and medical office building services costs (including amounts in discontinued operations). The following is a reconciliation of NOI to total revenues (including amounts in discontinued operations) for the three and nine months ended September 30, 2011 and 2010:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands)
Total revenues	$	565,957	$	264,665	$	1,201,078	$	748,873
Less:
Interest and other income		373		35		529		420
Property-level operating expenses		209,161		82,007		440,965		236,069
Medical office building services costs		6,347		4,633		19,837		4,633
NOI (excluding amounts in discontinued operations)		350,076		177,990		739,747		507,751
Discontinued operations		—		682		—		2,898
NOI (including amounts in discontinued operations)	$	350,076	$	178,672	$	739,747	$	510,649

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Liquidity and Capital Resources

During the nine months ended September 30, 2011, our principal sources of liquidity were proceeds from the issuance of debt and equity securities, cash flows from operations, borrowings under our unsecured revolving credit facilities and term loans, proceeds from our loans receivable and marketable securities portfolios, proceeds related to our litigation with HCP and cash on hand. We funded the Atria Senior Living acquisition, including deal costs, through the issuance of 24.96 million shares of our common stock, cash on hand, borrowings under our unsecured revolving credit facilities and assumed mortgage financing. We funded the NHP acquisition, including deal costs, through the issuance of 99.8 million shares of our common stock, cash on hand, borrowings under our unsecured revolving credit facilities and the assumption of debt.

For the remainder of 2011 and 2012, our principal liquidity needs are to: (i) fund normal operating expenses; (ii) meet our debt service requirements; (iii) repay maturing mortgage and other debt, including our 3⁷/8% convertible senior notes due 2011, our 9% senior notes due 2012, any borrowings under our term loan maturing in 2012 and the 8¹/4% senior notes due 2012 of NHP; (iv) fund capital expenditures for our senior living operations and MOB operations reportable segments; (v) fund acquisitions, investments and commitments and any development activities; and (vi) make distributions to our stockholders and unitholders, as required for us to continue to qualify as a REIT. We believe that these liquidity needs will be satisfied by cash flows from operations, cash on hand, debt assumptions and financings, issuances of debt and equity securities, proceeds from sales of assets and borrowings under our unsecured revolving credit facility and term loan. However, if these sources of capital are not available or if we engage in significant acquisition or investment activity, we may seek or require additional funding from debt assumptions and financings (including secured financings), dispositions of assets (in whole or in part through joint venture arrangements with third parties) and/or the issuance of secured or unsecured long-term debt or other securities.

As of September 30, 2011, we had a total of $57.5 million of unrestricted cash and cash equivalents, operating cash and cash related to our senior living operations and MOB operations reportable segments that is deposited and held in property-level accounts. Funds maintained in the property-level accounts are used primarily for the payment of property-level expenses and certain capital expenditures. As of September 30, 2011, we also had escrow deposits and restricted cash of $84.8 million.

Unsecured Revolving Credit Facilities and Term Loans

Our unsecured revolving credit facilities provided us with $1.0 billion of aggregate borrowing capacity as of September 30, 2011, all of which was scheduled to mature on April 26, 2012. Borrowings under our unsecured revolving credit facilities bore interest at a fluctuating rate per annum (based on U.S. or Canadian LIBOR, the Canadian Bankers’ Acceptance rate, or the U.S. or Canadian Prime rate), plus an applicable percentage based on our consolidated leverage. At September 30, 2011, the applicable percentage was 2.80%. Our unsecured revolving credit facilities also had a 20 basis point facility fee. At September 30, 2011, we had $474.0 million of borrowings outstanding, $8.3 million of outstanding letters of credit and $517.7 million of unused borrowing capacity available under our unsecured revolving credit facilities, and we were in compliance with all covenants under the unsecured revolving credit facilities.

Effective October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new unsecured revolving credit facility (“Credit Facility”). The Credit Facility provides us with $2.0 billion of aggregate borrowing capacity, which may be increased, at our option subject to the satisfaction of certain conditions, to up to $2.5 billion, and includes sublimits of (i) up to $200 million for letters of credit, (ii) up to $200 million for swingline loans, (iii) up to $250 million for loans in certain alternative currencies, and (iv) up to 50% of the facility for certain negotiated rate loans. Borrowings under the Credit Facility bear interest at a fluctuating rate per annum (based on the applicable LIBOR for Eurocurrency rate loans and the higher of (i) the federal funds rate plus 0.50%, (ii) the administrative agent’s prime rate and (iii) the applicable LIBOR plus 1.0% for base rate loans, plus, in each case, an applicable percentage based on our senior unsecured long-term debt ratings). We also pay a facility fee ranging from 15 to 45 basis points per annum (based on our senior unsecured long-term debt ratings) on the aggregate revolving commitments under the Credit Facility. At October 18, 2011, the applicable percentage was 1.25% for Eurocurrency rate loans and 0.25% for base rate loans and the facility fee was 25 basis points. The Credit Facility matures on October 16, 2015, but may be extended, at our option subject to the satisfaction of certain conditions, for an additional period of one year.

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The Credit Facility imposes certain customary restrictions on us, including restrictions pertaining to: (i) liens; (ii) investments; (iii) the incurrence of additional indebtedness; (iv) mergers, sales of assets and dissolutions; (v) certain dividend, distribution and other payments; (vi) permitted businesses; (vii) transactions with affiliates; (viii) agreements limiting certain liens; and (ix) the maintenance of certain consolidated total leverage, secured debt leverage, unsecured leverage and fixed charge coverage ratios and minimum consolidated adjusted net worth, and contains customary events of default.

In connection with the NHP acquisition, on July 1, 2011, we acquired additional liquidity from an $800.0 million senior unsecured term loan (“Term Loan”) previously extended to NHP. At our option, borrowings under the Term Loan, which are available from time to time on a non-revolving basis, bear interest at the applicable LIBOR plus 1.50% (1.69% at September 30, 2011) or the “Alternate Base Rate” plus 0.50% (we had no base rate borrowings outstanding at September 30, 2011). We pay a facility fee of 10 basis points per annum on the unused commitments under the Term Loan agreement. Borrowings under the Term Loan mature on June 1, 2012. At September 30, 2011, we had $250.0 million of borrowings outstanding and $550.0 million of available borrowing capacity under the Term Loan, and we were in compliance with all covenants under the Term Loan. On November 1, 2011, we repaid the $250.0 million of borrowings outstanding and continue to have $550.0 million of available borrowing capacity under the Term Loan.

As of November 2, 2011, we had $727 million of borrowings outstanding under the Credit Facility and $0 outstanding under the Term Loan.

Mortgages

We assumed mortgage debt of $1.2 billion and $0.4 billion, respectively, in connection with the Atria Senior Living and NHP acquisitions.

In February 2011, we repaid in full mortgage loans outstanding in the aggregate principal amount of $307.2 million and recognized a loss on extinguishment of debt of $16.5 million in connection with this repayment during the first quarter of 2011.

Equity Offerings

In February 2011, we completed the sale of 5,563,000 shares of our common stock in an underwritten public offering pursuant to our existing shelf registration statement. We received $300.0 million in aggregate proceeds from the sale, which we used to repay existing mortgage debt and for working capital and other general corporate purposes.

On May 19, 2011, we filed a shelf registration statement relating to the resale by the selling stockholders of the shares of our common stock issued as partial consideration for the Atria Senior Living acquisition.

On July 1, 2011, following approval by our stockholders, we amended our Amended and Restated Certificate of Incorporation, as previously amended, to increase the number of authorized shares of our capital stock to 610,000,000, comprised of 600,000,000 shares of common stock, par value $0.25 per share, and 10,000,000 shares of preferred stock, par value $1.00 per share.

Senior Notes

In May 2011, we issued and sold $700.0 million aggregate principal amount of 4.750% senior notes due 2021, at a public offering price equal to 99.132% of par for total proceeds of $693.9 million, before the underwriting discount and expenses. We used a portion of the proceeds from the issuance to fund a senior unsecured term loan to NHP in the aggregate principal amount of $600.0 million, bearing interest at a fixed rate of 5.0% per annum and maturing in 2021. As a result of the NHP acquisition, this term loan and related interest are being eliminated in consolidation.

In July 2011, we redeemed $200.0 million principal amount of our outstanding 6¹/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $8.7 million during the third quarter of 2011.

As a result of the NHP acquisition, we assumed $991.6 million aggregate principal amount of outstanding unsecured senior notes. On July 15, 2011, we repaid in full, at par, $339.0 million principal amount then outstanding of NHP’s 6.50% senior notes due 2011 upon maturity. The remaining NHP senior notes outstanding bear interest at fixed rates ranging from 6.00% to 8.25% per annum and have maturity dates ranging from July 1, 2012 to July 7, 2038, subject in certain cases to earlier repayment at the option of the holder.

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Cash Flows

The following is a summary of our sources and uses of cash flows for the nine months ended September 30, 2011 and 2010:

	For the Nine Months
	Ended September 30,						Change
	2011			2010			$			%
	(Dollars in thousands)
Cash and cash equivalents at beginning of period	$	21,812		$	107,397		$	(85,585	)		(79.7	)%
Net cash provided by operating activities		443,901			346,119			97,782			28.3
Net cash used in investing activities		(842,924	)		(268,476	)		(574,448	)		( > 100	)
Net cash provided by (used in) financing activities		434,790			(151,319	)		586,109			> 100
Effect of foreign currency translation on cash and cash equivalents		(97	)		69			(166	)		( > 100	)
Cash and cash equivalents at end of period	$	57,482		$	33,790		$	23,692			70.1	%

Cash Flows from Operating Activities

Cash flows from operating activities increased during the nine months ended September 30, 2011 over the same period in 2010 primarily due to higher NOI and proceeds related to our litigation with HCP, partially offset by higher general, administrative and professional fees, merger-related expenses and deal costs and interest expense.

Cash Flows from Investing Activities

Cash used in investing activities during the nine months ended September 30, 2011 and 2010 consisted primarily of our investments in real estate ($344.7 million and $239.2 million in 2011 and 2010, respectively), purchase of noncontrolling interests ($3.3 million in 2011), investments in loans receivable ($619.9 million and $38.7 million in 2011 and 2010, respectively), capital expenditures ($28.7 million and $11.6 million in 2011 and 2010, respectively), and development project expenditures ($23.2 million and $1.6 million in 2011 and 2010, respectively). These uses were offset by proceeds from real estate disposals ($15.0 million and $25.6 million in 2011 and 2010, respectively), proceeds from loans receivable ($138.9 million and $1.6 million in 2011 and 2010, respectively), and proceeds from the sale of marketable debt securities ($23.1 million in 2011).

Cash Flows from Financing Activities

Cash provided by financing activities during the nine months ended September 30, 2011 consisted primarily of $434.0 million of net borrowings under our unsecured revolving credit facilities, $957.8 million of proceeds from the issuance of debt and $299.9 million of net proceeds from the issuance of common stock. These cash inflows were partially offset by $895.0 million of debt repayments and $354.9 million of cash dividend payments to common stockholders.

Cash used in financing activities during the nine months ended September 30, 2010 consisted primarily of $331.4 million of debt repayments and $251.9 million of cash dividend payments to common stockholders. These uses were partially offset by $233.0 million of net borrowings under our unsecured revolving credit facilities and $201.2 million of proceeds from the issuance of debt.

Capital Expenditures

Our tenants generally bear the responsibility of maintaining and improving our triple-net leased properties. Accordingly, we do not expect to incur any major capital expenditures in connection with these properties. After the terms of the triple-net leases expire, or in the event that the tenants are unable or unwilling to meet their obligations under those leases, we anticipate funding any capital expenditures for which we may become responsible by cash flows from operations or through additional borrowings. With respect to our senior living operations and MOB operations reportable segments, we expect that capital expenditures will be funded by the cash flows from the properties or through additional borrowings. To the extent that unanticipated expenditures or significant borrowings are required, our liquidity may be affected adversely. Our ability to borrow additional funds may be restricted in certain circumstances by the terms of the instruments governing our outstanding indebtedness.

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Contractual Obligations

The following table summarizes the effect that minimum debt (which includes principal and interest payments) and other material noncancelable commitments are expected to have on our cash flow in future periods as of September 30, 2011:

			Less than 1						More than 5
	Total		year (4)		1-3 years (5)		3-5 years (6)		years (7)
Long-term debt obligations (1)(2)	$	7,825,108	$	1,553,800	$	1,569,140	$	1,685,205	$	3,016,963
Capital lease obligations		213,440		9,415		19,209		19,715		165,101
Acquisition commitments (3)		205,662		205,662		—		—		—
Operating and ground lease obligations		373,502		17,386		30,481		26,254		299,381
Total	$	8,617,712	$	1,786,263	$	1,618,830	$	1,731,174	$	3,481,445

(1)	Amounts represent contractual amounts due, including interest.
(2)	Interest on variable rate debt was based on forward rates obtained as of September 30, 2011.
(3)	Represents our commitments for the acquisitions of four seniors housing communities and two MOBs.
(4)	Includes $230.0 million outstanding principal amount of our 37/8% convertible senior notes due 2011, $474.0 million of borrowings outstanding under our unsecured revolving credit facilities that we repaid on October 18, 2011 (prior to entering into a new $2.0 billion unsecured revolving credit facility due 2015, subject to a one-year extension), $250.0 million outstanding under our unsecured term loan due 2012 that we repaid on November 1, 2011, $82.4 million outstanding principal amount of our 9% senior notes due 2012, and $73.0 million outstanding principal amount of NHP’s 81/4% senior notes due 2012.
(5)	Includes $200.0 million of borrowings under our unsecured term loan due 2013 and $269.9 million outstanding principal amount of NHP’s 6.25% senior notes due 2013.
(6)	Includes $400.0 million outstanding principal amount of our 3.125% senior notes due 2015, $234.4 million outstanding principal amount of NHP’s 6% senior notes due 2015, and $200.0 million outstanding principal amount of NHP’s 61/2% senior notes due 2016.
(7)	Includes $225.0 million outstanding principal amount of our 63/4% senior notes due 2017, $700.0 million outstanding principal amount of our 4.750% senior notes due 2021, $52.4 million outstanding principal amount of NHP’s 6.90% senior notes due 2037, and $23.0 million outstanding principal amount of NHP’s 6.59% senior notes due 2038.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The following discussion of our exposure to various market risks contains forward-looking statements that involve risks and uncertainties. These projected results have been prepared utilizing certain assumptions considered reasonable in light of information currently available to us. Nevertheless, because of the inherent unpredictability of interest rates as well as other factors, actual results could differ materially from those projected in such forward-looking information.

We are exposed to market risk related to changes in interest rates on borrowings under our unsecured revolving credit facility and $800.0 million term loan, certain of our mortgage loans that are floating rate obligations, mortgage loans receivable and marketable debt securities. These market risks result primarily from changes in LIBOR rates or prime rates. We continuously monitor our level of floating rate debt with respect to total debt and other factors, including our assessment of the current and future economic environment.

Interest rate fluctuations generally do not affect our fixed rate debt obligations until they mature. However, changes in interest rates affect the fair value of our fixed rate debt. If interest rates have risen at the time our fixed rate debt matures or is refinanced, our future earnings and cash flows could be adversely affected by the additional borrowing costs. Conversely, lower interest rates at the time of maturity or refinancing may lower our overall borrowing costs.

To highlight the sensitivity of our fixed rate debt to changes in interest rates, the following summary shows the effects of a hypothetical instantaneous change of 100 basis points (“BPS”) in interest rates as of September 30, 2011 and December 31, 2010:

	As of		As of
	September 30, 2011		December 31, 2010
	(In thousands)
Gross book value	$	4,936,341	$	2,771,696
Fair value (1)		5,263,326		2,900,143
Fair value reflecting change in interest rates: (1)
-100 BPS		5,486,646		3,008,630
+100 BPS		5,055,993		2,794,140

(1) The change in fair value of fixed rate debt was due primarily to overall changes in interest rates and the assumption of debt in connection with the Atria Senior Living and NHP acquisitions.

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The table below sets forth certain information with respect to our debt, excluding premiums, discounts and capital lease obligations.

	As of			As of			As of
	September 30,			December 31,			September 30,
	2011			2010			2010
	(Dollars in thousands)
Balance:
Fixed rate:
Senior notes and other	$	2,690,026		$	1,537,433		$	1,209,087
Mortgage loans and other		2,246,315			1,234,263			1,299,252
Variable rate:
Unsecured revolving credit facilities		474,000			40,000			244,336
Unsecured term loan		250,000			—			—
Mortgage loans and other		405,515			115,258			167,080
Total	$	6,065,856		$	2,926,954		$	2,919,755
Percent of total debt:
Fixed rate:
Senior notes and other		44.4	%		52.5	%		41.4	%
Mortgage loans and other		37.0	%		42.2	%		44.5	%
Variable rate:
Unsecured revolving credit facilities		7.8	%		1.4	%		8.4	%
Unsecured term loan		4.1	%		0.0	%		0.0	%
Mortgage loans and other		6.7	%		3.9	%		5.7	%
Total		100.0	%		100.0	%		100.0	%
Weighted average interest rate at end of period:
Fixed rate:
Senior notes and other		5.2	%		5.1	%		5.8	%
Mortgage loans and other		6.1	%		6.2	%		6.2	%
Variable rate:
Unsecured revolving credit facilities		3.0	%		3.1	%		3.4	%
Unsecured term loan		1.8	%		N/A			N/A
Mortgage loans and other		2.1	%		1.5	%		1.6	%
Total		5.0	%		5.4	%		5.5	%

The variable rate debt in the table above reflects, in part, the effect of $167.9 million notional amount of interest rate swaps with a maturity of February 1, 2013 that effectively convert fixed rate debt to variable rate debt. The increase in our outstanding variable rate debt from December 31, 2010 is primarily attributable to debt assumed in connection with the Atria Senior Living and NHP acquisitions and borrowings under our previous unsecured revolving credit facilities. Pursuant to the terms of certain leases with one of our tenants, if interest rates increase on certain variable rate debt that we have totaling $80.0 million as of September 30, 2011, our tenant is required to pay us additional rent (on a dollar-for-dollar basis) in an amount equal to the increase in interest expense resulting from the increased interest rates. Therefore, the increase in interest expense related to this debt is equally offset by an increase in additional rent due to us from the tenant. Assuming a 100 basis point increase in the weighted average interest rate related to our variable rate debt, and assuming no change in the outstanding balance as of September 30, 2011, interest expense for 2011 would increase by approximately $11.0 million, or $0.04 per diluted common share. The fair value of our fixed and variable rate debt is based on current interest rates at which we could obtain similar borrowings.

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We earn interest from investments in marketable debt securities on a fixed rate basis. We record these investments as available-for-sale at fair value, with unrealized gains and losses recorded as a component of stockholders’ equity. Interest rate fluctuations and market conditions will cause the fair value of these investments to change. As of September 30, 2011 and December 31, 2010, the aggregate fair value of our marketable debt securities held at September 30, 2011, which had an aggregate original cost of $37.8 million, was $42.8 million and $43.4 million, respectively. During the three months ended March 31, 2011, we sold marketable debt securities and received proceeds of approximately $23.1 million. As of September 30, 2011, the fair value of our secured and unsecured loans receivable was $367.8 million and was based on our estimates of currently prevailing rates for comparable loans.

We are subject to fluctuations in U.S. and Canadian exchange rates which may, from time to time, have an impact on our financial condition and results of operations. Increases or decreases in the value of the Canadian dollar will impact the amount of net income we earn from our senior living operations in Canada. Based on results for the nine months ended September 30, 2011, if the Canadian dollar exchange rate were to increase or decrease by $0.10, our results from operations would decrease or increase, as applicable, by approximately $0.1 million for the nine-month period. If we increase our international presence through investments in, or acquisitions or development of, seniors housing or healthcare assets outside the United States, we may also decide to transact additional business or borrow funds under our new unsecured revolving credit facility in currencies other than U.S. or Canadian dollars. Although we may decide to pursue hedging alternatives (including additional borrowings in local currencies) to protect against foreign currency fluctuations, we cannot assure you that any such fluctuations will not have a Material Adverse Effect on us.

We may engage in hedging strategies to manage our exposure to market risks in the future, depending on an analysis of the interest rate and foreign currency exchange rate environments and the costs and risks of such strategies. We do not use derivative financial instruments for speculative purposes.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2011. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of September 30, 2011, at the reasonable assurance level.

Internal Control Over Financial Reporting

On July 1, 2011, we acquired NHP in a stock-for-stock transaction which added 654 seniors housing and healthcare properties to our portfolio. We believe that we have implemented adequate procedures and controls to ensure that, during the initial transition period following this acquisition, which includes the remainder of 2011, financial information pertaining to these properties is materially correct and properly reflected in our Consolidated Financial Statements. However, we cannot provide absolute assurance that such information is materially correct in all respects.

Except as described above, during the third quarter of 2011, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The information contained in “Note 10—Litigation” of the Notes to Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated by reference into this Item 1. Except as set forth therein, there have been no new material legal proceedings and no material developments in the legal proceedings reported in our Annual Report on Form 10-K for the year ended December 31, 2010.

ITEM 1A. RISK FACTORS

The following risk factors reflect certain modifications of, or additions to, the risk factors continued in our Annual Report on Form 10-K for the year ended December 31, 2010 primarily as a result of our Atria Senior Living and NHP acquisitions.

The properties managed by Sunrise and Atria account for a significant portion of our revenues and operating income; Although Sunrise and Atria are managers, not tenants, in our properties, adverse developments in their business and affairs or financial condition could have a Material Adverse Effect on us.

As of September 30, 2011, Sunrise and Atria, collectively, managed 196 of our seniors housing communities pursuant to long-term management agreements. These properties represent a substantial portion of our portfolio, based on their gross book value, and account for a significant portion of our total revenues and operating income. Although we have various rights as owner under the Sunrise and Atria management agreements, we rely on Sunrise’s and Atria’s personnel, good faith, expertise, historical performance, technical resources and information systems, proprietary information and judgment to manage our seniors housing communities efficiently and effectively. We also rely on Sunrise and Atria to set resident fees, to provide accurate property-level financial results for our properties in a timely manner and to otherwise operate those properties in accordance with the terms of our management agreements and in compliance with all applicable laws and regulations. For example, we depend on Sunrise’s and Atria’s ability to attract and retain skilled management personnel who are responsible for the day-to-day operations of our seniors housing communities. A shortage of nurses or other trained personnel or general inflationary pressures may force Sunrise or Atria to enhance its pay and benefits package to compete effectively for such personnel, and Sunrise or Atria may not be able to offset such added costs by increasing the rates charged to residents. Any increase in labor costs and other property operating expenses, any failure by Sunrise or Atria to attract and retain qualified personnel, or changes in Sunrise’s or Atria’s senior management could adversely affect the income we receive from our seniors housing communities and have a Material Adverse Effect on us.

Because Sunrise and Atria do not lease properties from us, we are not directly exposed to credit risk with respect to those entities. However, any adverse developments in Sunrise’s or Atria’s business and affairs or financial condition could impair their ability to manage our properties efficiently and effectively and could have a Material Adverse Effect on us. If Sunrise or Atria experiences any significant financial, legal, accounting or regulatory difficulties due to the weakened economy or otherwise, such difficulties could result in, among other adverse events, acceleration of its indebtedness, impairment of its continued access to capital, the enforcement of default remedies by its counterparties or the commencement of insolvency proceedings by or against it under the U.S. Bankruptcy Code, any one or a combination of which indirectly could have a Material Adverse Effect on us.

The acquisition of NHP presents certain risks to our business and operations.

In July 2011, we acquired NHP in a stock-for-stock transaction. Pursuant to the terms and subject to the conditions set forth in the agreement and plan of merger dated as of February 27, 2011, at the effective time of the merger, each outstanding share of NHP common stock (other than shares owned by us or any of our subsidiaries or any wholly owned subsidiary of NHP) was converted into the right to receive 0.7866 shares of our common stock, with cash paid in lieu of fractional shares.

The NHP acquisition presents certain risks to our business and operations, including, among other things, that:

• we may be unable to successfully integrate our business and NHP’s business and realize the anticipated benefits of the merger or do so within the anticipated timeframe;

• we may not be able to effectively manage our expanded operations;

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• changes to the composition of our board of directors made upon completion of the merger may affect future decisions relating to our company;

• we may be unable to retain key employees;

• the market price of our common stock may decline; and

• we may be unable to continue paying dividends at the current rate.

We cannot assure you that we will be able to integrate NHP’s business without encountering difficulties or that any such difficulties will not have a Material Adverse Effect on us.

The weakened economy could adversely impact our operating income and earnings, as well as the results of operations of our tenants and operators, which could impair their ability to meet their obligations to us.

Continued concerns about the U.S. economy and the systemic impact of high unemployment, volatile energy costs, geopolitical issues, the availability and cost of credit, the U.S. mortgage market and a severely distressed real estate market have contributed to increased market volatility and weakened business and consumer confidence. This difficult operating environment could adversely affect our ability to generate revenues and/or increase our costs in our senior living and MOB operations, thereby reducing our operating income and earnings. It could also have an adverse impact on the ability of our tenants and operators to maintain occupancy and rates in our properties, which could harm their financial condition. These economic conditions could cause us to experience operating deficiencies in our senior living and MOB operations and/or cause our tenants and operators to be unable to meet their rental payments and other obligations due to us, which could have a Material Adverse Effect on us.

If the federal government’s borrowing authority is not increased as needed to meet its future obligations or if the debt rating on U.S. government securities is downgraded, our access to and cost of capital may be adversely affected; Any legislation to address the federal government’s borrowing authority or projected operating deficit could have a material adverse effect on our operators’ liquidity, financial condition or results of operations.

The amount of debt that the federal government is permitted to incur (the “debt ceiling”) is limited by statute and can be increased only by legislation adopted by the U.S. Congress. Prior to the passage of the Budget Control Act of 2011 (the “Budget Control Act”), the U.S. Department of the Treasury had indicated in public statements that, without an increase of the debt ceiling, the federal government would be unable to meet all of its financial commitments beginning in August 2011. Despite the legislation enacted on August 2, 2011 to lift the debt ceiling and reduce the federal government’s projected operating deficit, the federal government’s failure to further increase the debt ceiling as needed to meet its future financial commitments and/or a downgrade in the debt rating on U.S. government securities could lead to a weakened U.S. dollar, rising interest rates and constrained access to capital, which could materially adversely affect the U.S. and global economies, increase our costs of borrowing and have a Material Adverse Effect on us.

To implement the Budget Control Act, President Obama and members of the U.S. Congress have proposed various spending cuts and tax reform initiatives, some of which could result in changes (including substantial reductions in funding) to Medicare, Medicaid or Medicare Advantage Plans. Under the agreement reached to allow the federal government to raise the debt ceiling in August, a twelve-member, bipartisan committee has been given a deadline of November 23, 2011 to develop recommendations for reducing the federal budget deficit by a total of at least $1.2 trillion over ten years. If the committee cannot agree on a plan, or if the U.S. Congress does not enact the committee’s recommendations by December 23, 2011, $1.2 trillion in automatic spending cuts, including potential reductions in Medicare provider payments, could take effect beginning in January 2013. These measures and any future federal legislation relating to the debt ceiling or deficit reduction could have a material adverse effect on our operators’ liquidity, financial condition or results of operations, which could adversely affect their ability to satisfy their obligations to us and which, in turn, could have a Material Adverse Effect on us.

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We are exposed to various operational risks, liabilities and claims with respect to our operating assets that may adversely affect our ability to generate revenues and/or increase our costs and could have a Material Adverse Effect on us.

We are exposed to various operational risks, liabilities and claims with respect to our operating assets, including our third-party managed seniors housing communities and our MOBs, that may adversely affect our ability to generate revenues and/or increase our costs, thereby reducing our profitability. These risks include fluctuations in occupancy levels, the inability to achieve economic resident fees (including anticipated increases in those fees), rent control regulations, increases in costs of materials, energy, labor (as a result of unionization or otherwise) and services, national and regional economic conditions, the imposition of new or increased taxes, capital expenditure requirements, professional and general liability claims and the availability and costs of professional and general liability insurance. Any one or a combination of these factors could result in operating deficiencies at our operating assets which could have a Material Adverse Effect on us.

We have only limited rights to terminate our management agreements with Sunrise and Atria, and we may be unable to replace Sunrise or Atria if our management agreements are terminated or not renewed.

We are parties to long-term management agreements with each of Sunrise and Atria pursuant to which Sunrise and Atria, collectively, provide comprehensive property management services with respect to 196 of our seniors housing communities.

Each management agreement with Sunrise has an original term of 30 years commencing as early as 2004, and each management agreement with Atria has a term of ten years, subject to successive automatic ten-year renewal periods. Each management agreement with Sunrise or Atria may be terminated by us upon the occurrence of an event of default by Sunrise or Atria, respectively, in the performance of a material covenant or term thereof (including, in certain circumstances, the revocation of any licenses or certificates necessary for operation), subject in most cases to Sunrise’s or Atria’s rights to cure such defaults. Each management agreement with Sunrise or Atria may also be terminated upon the occurrence of certain insolvency events relating to Sunrise or Atria, respectively. In addition, we may terminate each management agreement with Sunrise based on the failure to achieve certain net operating income targets or to comply with certain expense control covenants and each management agreement with Atria based on the failure to achieve certain net operating income targets. Under certain circumstances, we may also terminate each management agreement with Atria upon the payment of a fee. However, various legal and contractual considerations may limit or delay our exercise of any or all of these termination rights.

In the event that our management agreements with Sunrise or Atria are terminated for any reason or are not renewed upon expiration of their terms, we will have to find another manager for the properties covered by those agreements. We believe there are a number of qualified national and regional seniors care providers that would be interested in managing our seniors housing communities. However, we cannot assure you that we will be able to locate another suitable manager or, if we are successful in locating such a manager, that it will manage the properties effectively. Moreover, any such replacement manager would require approval by the applicable regulatory authority and, in most cases, the mortgage lender of the applicable property. We cannot assure you that such approvals would be granted or that, if granted, the process of seeking such approvals would not cause delay. Any inability or lengthy delay in replacing Sunrise or Atria as manager following termination or non-renewal of our management agreements could have a Material Adverse Effect on us.

Our investments in joint ventures could be adversely affected by our lack of sole decision-making authority regarding major decisions, our reliance on our joint venture partners’ financial condition, any disputes that may arise between us and our joint venture partners and our exposure to potential losses from the actions of our joint venture partners.

As of September 30, 2011, we had controlling interests in eleven MOBs and eighteen seniors housing communities owned through joint ventures with third parties, and we had noncontrolling interests of between 5% and 25% in 58 MOBs, 20 seniors housing communities and fourteen skilled nursing facilities owned through joint ventures with third parties. These joint ventures involve risks not present with respect to our wholly owned properties, including the following:

• We may be prevented from taking actions that are opposed by our joint venture partners. Under certain of our joint venture arrangements, we may share decision-making authority with our joint venture partners regarding major decisions affecting the ownership or operation of the joint venture and any property owned by the joint venture, such as the sale or financing of the property or the making of additional capital contributions for the benefit of the property. For joint ventures in which we have a noncontrolling interest our joint venture partners may take actions that we oppose;

• Our ability to transfer our interest in a joint venture to a third party may be restricted. Prior consent of our joint venture partners may be required for a sale or transfer to a third party of our interests in such joint ventures;

• Our joint venture partners might become bankrupt or fail to fund their share of required capital contributions, which may delay construction or development of a property or increase our financial commitment to the joint venture;

• Our joint venture partners may have business interests or goals with respect to the property that conflict with our business interests and goals, which could increase the likelihood of disputes regarding the ownership, management or disposition of the property;

• Disputes may develop with our joint venture partners over decisions affecting the property or the joint venture, which may result in litigation or arbitration that could increase our expenses, distract our officers and/or directors from focusing their time and effort on our business and disrupt the day-to-day operations of the property, such as by delaying the implementation of important decisions until the conflict or dispute is resolved; and

• We may suffer losses as a result of the actions of our joint venture partners with respect to our joint venture investments.

Revenues from our senior living operations are dependent on private pay sources; Events which adversely affect the ability of seniors to afford our daily resident fees could cause our occupancy rates, resident fee revenues and results of operations to decline.

By and large, assisted and independent living services currently are not reimbursable under government reimbursement programs, such as Medicare and Medicaid. Hence, substantially all of the resident fee revenues generated by our senior living operations are derived from private pay sources consisting of income or assets of residents or their family members. In general, due to the expense associated with building new properties and the staffing and other costs of providing services at these properties, only seniors with income or assets meeting or exceeding the comparable median in the regions where our properties are located typically can afford to pay the daily resident and care fees. The current economic downturn and depressed housing market, as well as other events such as changes in demographics, could adversely affect the ability of seniors to afford these fees. If the managers of our seniors housing communities are unable to attract and retain seniors with sufficient income, assets or other resources required to pay the fees associated with assisted and independent living services, our occupancy rates, resident fee revenues and results of operations could decline, which, in turn, could have a Material Adverse Effect on us.

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Termination of resident lease agreements could adversely affect our revenues and earnings.

Applicable regulations governing assisted living communities generally require written resident lease agreements with each resident. Most of these regulations also require that each resident have the right to terminate the resident lease agreement for any reason on reasonable notice. Consistent with these regulations, the resident lease agreements signed by the managers of our seniors housing communities generally allow residents to terminate their lease agreements on 30 days’ notice. Thus, our managers cannot contract with residents to stay for longer periods of time, unlike typical apartment leasing arrangements with terms of up to one year or longer. In addition, the resident turnover rate in our seniors housing communities may be difficult to predict. If a large number of resident lease agreements terminate at or around the same time, and if our units remained unoccupied, then our revenues and earnings could be adversely affected, which, in turn, could have a Material Adverse Effect on us.

Significant legal actions could subject us or our tenants, operators and managers to increased operating costs and substantial uninsured liabilities, which could materially adversely affect our or their liquidity, financial condition and results of operation.

From time to time, we may be directly involved in lawsuits and other legal proceedings. We may also be named as defendants in lawsuits arising out of alleged actions of our tenants, operators and managers for which such tenants, operators and managers have agreed to indemnify, defend and hold us harmless from and against certain claims and liabilities. An unfavorable resolution of pending or future litigation could have a Material Adverse Effect on us.

Our tenants, operators and managers continue to experience increases in both the frequency and severity of professional liability claims. In addition to large compensatory claims, plaintiffs’ attorneys continue to seek significant punitive damages and attorneys’ fees. Due to the historically high frequency and severity of professional liability claims against healthcare providers, the availability of professional liability insurance has been restricted and the premiums on such insurance coverage remain very high. As a result, the insurance coverage of our tenants, operators and managers might not cover all claims against them or continue to be available to them at a reasonable cost. If our tenants, operators and managers are unable to maintain adequate insurance coverage or are required to pay punitive damages, they may be exposed to substantial liabilities.

In addition, many healthcare providers are pursuing different organizational and corporate structures coupled with self-insurance programs that provide less insurance coverage. For example, Kindred insures its professional liability risks, in part, through a wholly owned, limited purpose insurance company, which insures initial losses up to specified coverage levels per occurrence with no aggregate coverage limit. Coverage for losses in excess of those per occurrence levels is maintained through unaffiliated commercial insurance carriers up to an aggregate limit, and all claims in excess of the aggregate limit are then insured by the limited purpose insurance company. Similarly, Sunrise maintains a self-insurance program to cover its general and professional liabilities. Our tenants, operators and managers, like Kindred and Sunrise, that insure any part of their general and professional liability risks through their own captive limited purpose entities generally estimate the future cost of general and professional liability through actuarial studies that rely primarily on historical data. However, due to the rise in the number and severity of professional claims against healthcare providers, these actuarial studies may underestimate the future cost of claims, and reserves for future claims may not be adequate to cover the actual cost of those claims.

As a result, the tenants, operators and managers of our properties could incur large funded and unfunded professional liability expense, which could materially adversely affect their liquidity, financial condition and results of operations, and, in turn, their ability to make rental payments under, or otherwise comply with the terms of, their leases with us or, in the case of our senior living operations, our results of operations, which could have a Material Adverse Effect on us.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The table below summarizes repurchases of our common stock made during the quarter ended September 30, 2011:

	Number of Shares		Average Price
	Repurchased (1)		Per Share
July 1 through July 31		85,110	$	53.74
August 1 through August 31		—	$	—
September 1 through September 30		—	$	—

(1) Repurchases represent shares withheld to pay taxes on the vesting of restricted stock or the exercise of options granted to employees. The value of the shares withheld is the closing price of our common stock on the date the vesting or exercise occurs.

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ITEM 6. EXHIBITS

Exhibit
Number		Description of Document	Location of Document
	10.1	Credit and Guaranty Agreement, dated as of October 18, 2011, among Ventas Realty, Limited Partnership, Ventas SSL Ontario II, Inc. and Ventas SSL Ontario III, Inc., as borrowers, Ventas, Inc., as guarantor, the lenders identified therein, and Bank of America, N.A., as Administrative Agent, Swing Line Lender, L/C Issuer and Alternative Currency Fronting Lender.	Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on October 24, 2011.
	12.1	Statement Regarding Computation of Ratio of Earnings to Fixed Charges.	Filed herewith.
	31.1	Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.	Filed herewith.
	31.2	Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.	Filed herewith.
	32.1	Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.	Filed herewith.
	32.2	Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.	Filed herewith.
	101	Interactive Data File.	Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: November 7, 2011

VENTAS, INC.
By:	/s/ Debra A. Cafaro
	Debra A. Cafaro
	Chairman and Chief Executive Officer

By:	/s/ Richard A. Schweinhart
	Richard A. Schweinhart
	Executive Vice President and Chief Financial Officer

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EXHIBIT INDEX

Exhibit
Number		Description of Document	Location of Document
	10.1	Credit and Guaranty Agreement, dated as of October 18, 2011, among Ventas Realty, Limited Partnership, Ventas SSL Ontario II, Inc. and Ventas SSL Ontario III, Inc., as borrowers, Ventas, Inc., as guarantor, the lenders identified therein, and Bank of America, N.A., as Administrative Agent, Swing Line Lender, L/C Issuer and Alternative Currency Fronting Lender.	Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on October 24, 2011.
	12.1	Statement Regarding Computation of Ratio of Earnings to Fixed Charges.	Filed herewith.
	31.1	Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.	Filed herewith.
	31.2	Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.	Filed herewith.
	32.1	Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.	Filed herewith.
	32.2	Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.	Filed herewith.
	101	Interactive Data File.	Filed herewith.

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EX-12.1

Exhibit 12.1

STATEMENT REGARDING COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

	For the nine
	months ended
(dollars in thousands)	September 30, 2011
Income before loss from unconsolidated entities, income taxes and noncontrolling interest	$	147,525
Interest expense
Senior notes payable and other debt		170,046
Distributions from unconsolidated entities		2,138
Earnings	$	319,709
Interest
Senior notes payable and other debt expense	$	170,046
Fixed charges	$	170,046
Ratio of Earnings to Fixed Charges		1.88

EX-31.1

Exhibit 31.1

I, Debra A. Cafaro, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Ventas, Inc.;

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.

Date: November 7, 2011

/s/ Debra A. Cafaro Debra A. Cafaro

Chairman and Chief Executive Officer

EX-31.2

Exhibit 31.2

I, Richard A. Schweinhart, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Ventas, Inc.;

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.

Date: November 7, 2011

/s/ Richard A. Schweinhart Richard A. Schweinhart

Executive Vice President and Chief 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 on Form 10-Q of Ventas, Inc. (the “Company”) for the period ended September 30, 2011, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Debra A. Cafaro, Chairman and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 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; 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 7, 2011

/s/ Debra A. Cafaro Debra A. Cafaro

Chairman and Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

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 on Form 10-Q of Ventas, Inc. (the “Company”) for the period ended September 30, 2011, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Richard A. Schweinhart, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 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; 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 7, 2011

/s/ Richard A. Schweinhart Richard A. Schweinhart

Executive Vice President and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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Litigation (Details) (USD $) In Millions	1 Months Ended
	Aug. 31, 2011	Jul. 31, 2011	Aug. 23, 2011	Dec. 11, 2009
Loss Contingencies [Line Items]
Accrual for contingent fees for outside legal counsel			$ 5.75
Litigation (Textuals) [Abstract]
Compensatory damages, awarded in Litigation related to the Sunrise REIT Acquisition		101.6
Security by HCP, in letter of credit				102.8
Net proceeds from compensatory damages award	85
Donation to ventas charitable foundation			3
HCP Inc [Member]
Loss Contingencies [Line Items]
Payment for Judgment Plus costs and interest	$ 102.8

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Consolidated Balance Sheets (Parenthetical) (USD $)	Sep. 30, 2011	Dec. 31, 2010
Ventas stockholders' equity:
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued
Common stock, par value	$ 0.25	$ 0.25
Common stock, shares authorized	600,000,000	300,000,000
Common stock, shares issued	287,962,000	157,279,000
Treasury stock, shares	37,000	14,000

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Consolidated Statements of Income (Unaudited) (USD $) In Thousands, except Per Share data	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010
Rental income:
Triple-net leased	$ 211,479	$ 117,906	$ 450,211	$ 351,625
Medical office buildings	58,398	22,817	106,392	47,246
Total rental income	269,877	140,723	556,603	398,871
Resident fees and services	276,364	113,182	593,348	331,535
Medical office building and other services revenue	9,271	6,711	26,050	6,711
Income from loans and investments	10,072	4,014	24,548	11,336
Interest and other income	373	35	529	420
Total revenues	565,957	264,665	1,201,078	748,873
Expenses:
Interest	73,756	45,519	170,046	133,449
Depreciation and amortization	161,027	52,104	293,541	154,458
Property-level operating expenses:
Senior living	188,856	74,066	403,706	219,802
Medical office buildings	20,305	7,941	37,259	16,267
Property-level operating expenses	209,161	82,007	440,965	236,069
Medical office building services costs	6,347	4,633	19,837	4,633
General, administrative and professional fees	20,624	15,278	51,010	35,819
Loss on extinguishment of debt	8,685		25,211	6,549
Litigation proceeds, net	(85,327)		(85,327)
Merger-related expenses and deal costs	69,350	5,142	131,606	11,668
Other	14,436	(419)	6,664	(404)
Total expenses	478,059	204,264	1,053,553	582,241
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest	87,898	60,401	147,525	166,632
Income (loss) from unconsolidated entities	182	(392)	(71)	(392)
Income tax benefit (expense)	13,904	(1,657)	23,310	(2,352)
Income from continuing operations	101,984	58,352	170,764	163,888
Discontinued operations		542		7,139
Net income	101,984	58,894	170,764	171,027
Net (loss) income attributable to noncontrolling interest (net of tax of $0 and $613 for the three months ended 2011 and 2010, respectively, and $0 and 1,591 for the nine months ended 2011 and 2010, respectively)	(901)	996	(781)	2,443
Net income attributable to common stockholders	$ 102,885	$ 57,898	$ 171,545	$ 168,584
Basic:
Income from continuing operations attributable to common stockholders	$ 0.36	$ 0.37	$ 0.82	$ 1.03
Discontinued operations		$ 0.00		$ 0.05
Net income attributable to common stockholders	$ 0.36	$ 0.37	$ 0.82	$ 1.08
Diluted:
Income from continuing operations attributable to common stockholders	$ 0.35	$ 0.37	$ 0.81	$ 1.02
Discontinued operations		$ 0.00		$ 0.05
Net income attributable to common stockholders	$ 0.35	$ 0.37	$ 0.81	$ 1.07
Weighted average shares used in computing earnings per common share:
Basic	287,365	156,631	208,470	156,566
Diluted	290,794	157,941	210,850	157,453
Dividends declared per common share	$ 0.4486	$ 0.535	$ 1.725	$ 1.605

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Stockholder's Equity (Details Textuals) (USD $)	1 Months Ended
	Feb. 28, 2011	Sep. 30, 2011	Aug. 19, 2011	Jul. 02, 2011	Jun. 30, 2011	Dec. 31, 2010	Sep. 30, 2011 Atria Senior Living Acquisition [Member]	May 12, 2011 Atria Senior Living Acquisition [Member]	Sep. 30, 2011 Nationwide Health Properties [Member]	Jul. 12, 2011 Nationwide Health Properties [Member]	Jul. 02, 2011 Nationwide Health Properties [Member]
Business Acquisition [Line Items]
Shares reserved for issuance in connection with equity awards and other convertible or exchangeable securities									2,253,366
Common stock share value issued related to acquisition								$ 1,380,000,000			$ 5,400,000,000
Accrued dividend										23,800,000
Prorated Per Share Dividend Payable		$ 0.575	$ 0.4486		$ 0.1264
Common stock shares issued related to acquisition per share								$ 55.33			$ 53.74
Common stock, shares issued								24,958,543			99,849,106
Shares reduced for working capital adjustment with purchase agreement							83,441
Stockholders' Equity (Textuals) [Abstract]
Shares of common stock issued and sold in an underwritten public offering	5,563,000
Aggregate proceeds from the sale of common stock in an underwritten public offering pursuant	$ 300,000,000
Capital stock authorized				610,000,000
Common stock, shares authorized		600,000,000		600,000,000		300,000,000
Common stock, par value		$ 0.25		$ 0.25		$ 0.25
Preferred stock, shares authorized		10,000,000		10,000,000		10,000,000
Preferred stock, par value		$ 1.00		$ 1.00		$ 1.00

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Elmcroft II Portfolio Update

9 Months Ended

Sep. 30, 2011

Elmcroft II Portfolio Update [Abstract]

Elmcroft II Portfolio Update

NOTE 15 — ELMCROFT II PORTFOLIO UPDATE

In connection with the NHP acquisition, we acquired a portfolio of 32 triple-net leased seniors housing communities in ten states leased to a single operator. Subsequent to the acquisition, we transitioned the operation of these properties to affiliates of Senior Care, Inc., which now operates under the name “Elmcroft Senior Living” (together with its affiliates, “Elmcroft”). Elmcroft has been a tenant of 64 of our seniors housing and other healthcare properties since 2006. To effect the transition of the properties to Elmcroft, we terminated the previously existing master lease and two other individual leases relating to the properties and entered into new leases with Elmcroft. Each of the new Elmcroft leases has a term of fifteen years and is subject to two five-year renewal options. The previous operator will continue to hold the operating licenses for the properties pursuant to temporary license agreements with Elmcroft until Elmcroft receives new operating licenses. To date, eleven licenses have been granted to Elmcroft and the remaining licenses are in process.

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Document and Entity Information (USD $) In Billions, except Share data	9 Months Ended
	Sep. 30, 2011	Oct. 31, 2011	Jun. 30, 2010
Document and Entity Information [Abstract]
Entity Registrant Name	VENTAS INC
Entity Central Index Key	0000740260
Document Type	10-Q
Document Period End Date	Sep. 30, 2011
Amendment Flag	false
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 7.3
Entity Common Stock, Shares Outstanding		287,921,317

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Fair Values of Financial Instruments (Details) (USD $) In Thousands	Sep. 30, 2011	Dec. 31, 2010	Sep. 30, 2010	Dec. 31, 2009
Assets
Cash and cash equivalents	$ 57,482	$ 21,812	$ 33,790	$ 107,397
Cash and cash equivalents, Fair Value	57,482	21,812
Secured loans receivable, net	302,264	149,263
Secured loans receivable, net, Fair Value	302,393	155,377
Derivative instruments, Carrying Value	8,536	99
Derivative instruments, Fair Value	8,536	99
Marketable debt securities, Carrying Value	42,788	66,675
Marketable debt securities, Fair Value	42,788	66,675
Unsecured loans receivable ,net, Carrying value	65,384	0
Unsecured loans receivable, net, Fair value	65,384	0
Liabilities:
Senior notes payable and other debt, gross, Carrying Value	6,065,856	2,926,954
Senior notes payable and other debt, gross, Fair Value	6,415,640	3,055,435
Derivative instruments, Fair value	24,537	3,722
Derivative instruments, Carrying value	24,537	3,722
Contingent consideration liability, Carrying value	56,218	0
Contingent consideration liability, Fair Value	56,218	0
Redeemable OP unitholder interests, Carrying value	92,817	0
Redeemable OP unitholder interests, Fair value	$ 92,817	$ 0

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Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2011

Accounting Policies [Abstract]

Financial statement preparation

The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”), and with the Securities and Exchange Commission (“SEC”) instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. Operating results for the three and nine months ended September 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011. The accompanying Consolidated Financial Statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2010, filed with the SEC on February 18, 2011. Certain prior period amounts have been reclassified to conform to the current period presentation.

Principles of Consolidation

The accompanying Consolidated Financial Statements include our accounts and the accounts of our wholly owned subsidiaries and the joint venture entities over which we exercise control. All intercompany transactions and balances have been eliminated in consolidation, and net earnings are reduced by the portion of net earnings attributable to noncontrolling interests.

We apply FASB guidance for arrangements with variable interest entities (“VIEs”), which requires us to identify entities for which control is achieved through means other than voting rights and to determine which business enterprise is the primary beneficiary of the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. We consolidate investments in VIEs when we are determined to be the primary beneficiary of the VIE. We may change our original assessment of a VIE due to events such as the modification of contractual arrangements that affects the characteristics or adequacy of the entity’s equity investments at risk and the disposal of all or a portion of an interest held by the primary beneficiary. We identify the primary beneficiary of a VIE as the enterprise that has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance; and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the entity. We perform this analysis on an ongoing basis. At September 30, 2011, we did not have any unconsolidated VIEs.

We also apply FASB guidance related to investments in joint ventures based on the type of rights held by the limited partner(s) which may preclude consolidation by the sole general partner in certain circumstances in which the general partner would otherwise consolidate the joint venture. We assess limited partners’ rights and their impact on the presumption of control of the limited partnership by the sole general partner when an investor becomes the sole general partner and we reassess if (i) there is a change to the terms or in the exercisability of the rights of the limited partners, (ii) the sole general partner increases or decreases its ownership of limited partnership interests, or (iii) there is an increase or decrease in the number of outstanding limited partnership interests. We also apply this guidance to managing member interests in limited liability companies.

Revenue Recognition

Triple-Net Leased Properties and MOB Operations

Certain of our triple-net leases, including the majority of our leases with Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”), and most of our MOB leases provide for periodic and determinable increases in base rent. We recognize base rental revenues under these leases on a straight-line basis over the applicable lease term when collectibility is reasonably assured. Recognizing rental income on a straight-line basis results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in other assets on our Consolidated Balance Sheets. At September 30, 2011 and December 31, 2010, this net cumulative excess totaled $95.5 million and $86.3 million, respectively.

Our master lease agreements with Kindred Healthcare, Inc. (together with its subsidiaries, “Kindred”) (the “Kindred Master Leases”) and certain of our other leases provide for periodic increases in base rent only if certain revenue parameters or other substantive contingencies are met. We recognize the increased rental revenue under these leases as the related parameters or contingencies are met, rather than on a straight-line basis over the applicable lease term.

Senior Living Operations

We recognize resident fees and services, other than move-in fees, monthly as services are provided. We recognize move-in fees on a straight-line basis over the average resident stay. Our lease agreements with residents generally have a term of twelve to eighteen months and are cancelable by the resident upon 30 days’ notice.

Other

We recognize interest income from loans, including discounts and premiums, using the effective interest method when collectibility is reasonably assured. The effective interest method is applied on a loan-by-loan basis, and discounts and premiums are recognized as yield adjustments over the related loan term. We recognize interest income on an impaired loan to the extent our estimate of the fair value of the collateral is sufficient to support the balance of the loan, other receivables and all related accrued interest. When the balance of the loans, other receivables and all related accrued interest is equal to our estimate of the fair value of the collateral, we recognize interest income on a cash basis. We provide a reserve against an impaired loan to the extent our total investment in the loan exceeds our estimate of the fair value of the loan collateral.

We recognize income from rent, lease termination fees, management advisory services and all other income when all of the following criteria are met in accordance with SEC Staff Accounting Bulletin 104: (i) the applicable agreement has been fully executed and delivered; (ii) services have been rendered; (iii) the amount is fixed or determinable; and (iv) collectibility is reasonably assured.

Allowances

We assess the collectibility of our rent receivables, including straight-line rent receivables, in accordance with the applicable accounting standards and our reserve policy, and we defer recognition of revenue if collectibility is not reasonably assured. Our assessment of the collectibility of rent receivables (excluding straight-line receivables) is based on several factors, including, among other things, payment history, the financial strength of the tenant and any guarantors, the value of the underlying collateral, if any, and current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to recover the full value of the receivable, we provide a reserve against the portion of the receivable that we estimate may not be recovered. Our assessment of the collectibility of straight-line receivables is based on several factors, including, among other things, the financial strength of the tenant and any guarantors, the historical operations and operating trends of the property, the historical payment pattern of the tenant, and the type of property. If our evaluation of these factors indicates it is probable that we will be unable to receive the rent payments due in the future, we defer recognition of the straight-line rental income and, in certain circumstances, provide a reserve against the previously recognized straight-line rent receivable asset for a portion, up to its full value, that we estimate may not be recovered. If we change our assumptions or estimates regarding the collectibility of future rent payments required by a lease, we may adjust our reserve to increase or reduce the rental revenue recognized and/or to increase or reduce the reserve against the existing straight-line rent receivable.

Business Combinations

We account for acquisitions using the acquisition method and allocate the cost of the properties acquired among tangible and recognized intangible assets and liabilities based upon their estimated fair values as of the acquisition date. Recognized intangibles primarily include the value of in-place leases, acquired lease contracts, tenant and customer relationships, trade names/trademarks and goodwill. We do not amortize goodwill, which is included in other assets on our Consolidated Balance Sheets and represents the excess of the purchase price paid over the fair value of the net assets of the acquired business.

We estimate the fair value of buildings acquired on an as-if-vacant basis and depreciate the building value over the estimated remaining life of the building. We determine the allocated value of other fixed assets, such as site improvements and furniture, fixtures and equipment, based upon the replacement cost and depreciate such value over the assets’ estimated remaining useful lives. We determine the value of land by considering the sales prices of similar properties in recent transactions or based on (i) internal analyses of recently acquired and existing comparable properties within our portfolio or (ii) real estate tax assessed values in relation to the total value of the asset. The fair value of acquired lease intangibles, if any, reflects (i) the estimated value of any above and/or below market leases, determined by discounting the difference between the estimated market rent and the in-place lease rent, the resulting intangible asset or liability of which is amortized to revenue over the remaining life of the associated lease plus any bargain renewal periods, and (ii) the estimated value of in-place leases related to the cost to obtain tenants, including tenant allowances, tenant improvements and leasing commissions, and an estimated value of the absorption period to reflect the value of the rent and recovery costs foregone during a reasonable lease-up period as if the acquired space was vacant, which is amortized to amortization expense over the remaining life of the associated lease. We estimate the fair value of tenant or other customer relationships acquired, if any, by considering the nature and extent of existing business relationships with the tenant or customer, growth prospects for developing new business with the tenant or customer, the tenant’s credit quality, expectations of lease renewals with the tenant, and the potential for significant, additional future leasing arrangements with the tenant and amortize that value over the expected life of the associated arrangements or leases, including the remaining terms of the related leases and any expected renewal periods. We estimate the fair value of trade names/trademarks using a royalty rate methodology and amortize that value over the estimated useful life of the trade name/trademark.

In connection with a business combination, we may assume the rights and obligations under certain lease agreements pursuant to which we become the lessee of a given property. We assume the lease classification previously determined by the prior lessee absent a modification in the assumed lease agreement. In connection with our recent acquisitions, all capital leases acquired or assumed contain bargain purchase options that we intend to exercise. Therefore, we recognized an asset based on the acquisition date fair value of the underlying property and a liability based on the acquisition date fair value of the capital lease. We assess capital leases that contain bargain purchase options are depreciated over the asset’s useful life. We assess assumed operating leases, including ground leases, to determine if the lease terms are favorable or unfavorable given current market conditions on the acquisition date. To the extent the lease arrangement is favorable or unfavorable relative to market conditions on the acquisition date, we recognize an intangible asset or liability at fair value. The recognized asset or liability (excluding purchase option intangibles) for these leases is amortized to interest or rental expense over the applicable lease term and is included in our Consolidated Statements of Income. All lease-related intangible assets are included within acquired lease intangibles and all lease-related intangible liabilities are included within accounts payable and other liabilities, on our Consolidated Balance Sheets.

For loans receivable acquired in connection with a business combination, we determine fair value by discounting the estimated future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The estimated future cash flows reflect our judgment regarding the uncertainty of those cash flows and, therefore, we do not establish a valuation allowance at the acquisition date. The difference between the acquisition date fair value and the total expected cash flows is recognized as interest income using an effective interest method over the life of the applicable loan. Subsequent to the acquisition date, we evaluate changes regarding the uncertainty of future cash flows and the need for a valuation allowance.

We estimate the fair value of investments in unconsolidated entities and noncontrolling interests assumed using assumptions that are consistent with those used in valuing all of the underlying assets and liabilities.

We calculate the fair value of long-term debt by discounting the remaining contractual cash flows on each instrument at the current market rate for those borrowings, which we approximate based on the rate we would expect to incur to replace the instrument on the date of acquisition, and recognize any fair value adjustments related to long-term debt as effective yield adjustments over the remaining term of the instrument.

We record a liability for contingent consideration at fair value as of the acquisition date (which is included in accounts payable and other liabilities on our Consolidated Balance Sheets) and reassess the fair value at the end of each reporting period, with any changes being recognized in earnings. Increases or decreases in the fair value of contingent consideration can result from changes in discount periods, discount rates and probabilities that contingencies will be met.

Loans receivable

Loans receivable, other than those acquired in connection with a business combination, are recorded on our Consolidated Balance Sheets at the unpaid principal balance, net of any deferred origination fees, purchase discounts or premiums and valuation allowances. Unsecured loans receivable are included in other assets on our Consolidated Balance Sheets. We amortize net deferred origination fees, which are comprised of loan fees collected from the borrower net of certain direct costs, and purchase discounts or premiums over the contractual life of the loan using the effective interest method and recognize any unamortized balances in income immediately if the loan is repaid before its contractual maturity.

We regularly evaluate the collectibility of loans receivable based on several factors, including without limitation (i) corporate and facility-level financial and operational reports, (ii) compliance with any financial covenants set forth in the applicable loan agreement, (iii) the financial strength of the borrower and any guarantor, (iv) the payment history of the borrower, and (v) current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to collect all amounts due according to the terms of the applicable loan agreement, we provide a reserve against the portion of the receivable that we estimate may not be collected.

Leases

We include assets under capital leases within net real estate assets, and we include capital lease obligations within senior notes payable and other debt, on our Consolidated Balance Sheets. Lease payments under capital lease arrangements are segregated between interest expense and a reduction to the outstanding principal balance, using the effective interest method. We account for payments made pursuant to operating leases in our Consolidated Statements of Income based on actual rent paid, plus or minus a straight-line rent adjustment for minimum lease escalators.

Derivative Instruments

We recognize all derivative instruments in either other assets or accounts payable and accrued liabilities on our Consolidated Balance Sheets at fair value as of the reporting date. We recognize changes in the fair value of derivative instruments in other expenses on our Consolidated Statements of Income or accumulated other comprehensive income on our Consolidated Balance Sheets, depending on the intended use of the derivative and our designation of the instrument.

We do not use our derivative financial instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, for trading or speculative purposes. Our interest rate caps were designated as having a hedging relationship with their underlying securities and therefore meet the criteria for hedge accounting under GAAP. Our interest rate caps are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in accumulated other comprehensive income on our Consolidated Balance Sheets. Our interest rate swaps and foreign currency forward contracts were not designated as having a hedging relationship with their underlying securities and therefore do not meet the criteria for hedge accounting under GAAP. Our interest rate swaps and foreign currency forward contracts are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in current earnings (in other expenses) on our Consolidated Statements of Income.

Redeemable Limited Partnership Unitholder Interests

As part of the NHP acquisition, we acquired a majority interest in NHP/PMB L.P. (“NHP/PMB”), a limited partnership that was formed in 2008 to acquire properties from entities affiliated with Pacific Medical Buildings LLC. We consolidate NHP/PMB, as our wholly owned subsidiary is the general partner and exercises control. As of September 30, 2011, third party investors owned 2,375,027 Class A limited partnership units in NHP/PMB (“OP Units”), which represented 29.1% of the total units then outstanding, and we owned 5,795,210 Class B limited partnership units in NHP/PMB, representing the remaining 70.9%. At any time following the first anniversary of the date of issuance, the OP Units may be redeemed, at the election of the holder, for cash or, at our option, 0.7866 shares of our common stock per unit, subject to adjustment in certain circumstances. We are party to a registration rights agreement with the holders of the OP Units that requires us, subject to the terms and conditions set forth therein, to file and maintain a registration statement relating to the issuance of shares of our common stock upon redemption of OP Units. As registration rights are outside of our control, the redeemable OP unitholder interests are classified outside of permanent equity on our Consolidated Balance Sheets. We applied the provisions of ASC Topic 480, Distinguishing Liabilities from Equity, to reflect the redeemable OP unitholder interests at the greater of cost or fair value. As of September 30, 2011, the fair value of the redeemable OP unitholder interests was $92.8 million. The change in fair value from the acquisition date to September 30, 2011 has been recorded through capital in excess of par value. Our diluted earnings per share (“EPS”) includes the effect of any potential shares outstanding from these OP Units.

Noncontrolling Interests

For entities that we control (and thus consolidate) but do not own 100% of the equity, the portion of the equity we do not own is presented as noncontrolling interests and classified as a component of consolidated equity. Each such entity’s contribution to our income and earnings per share is based on income attributable to the entity’s parent and is included in net income attributable to common stockholders on our Consolidated Statements of Income. As our ownership of a controlled subsidiary increases or decreases, any difference between the aggregate consideration paid to acquire the noncontrolling interests and our noncontrolling interest balance is recorded as a component of equity in additional paid-in capital, so long as we maintain a controlling ownership interest.

As of September 30, 2011 and December 31, 2010, we had controlling interests in 29 properties and six properties, respectively, owned through joint ventures. The noncontrolling interest in these properties as of September 30, 2011 and December 31, 2010 was $84.5 million and $3.5 million, respectively. For the three months ended September 30, 2011 and 2010, we recorded a loss attributable to noncontrolling interests of $0.9 million and income attributable to noncontrolling interests of $1.0 million, respectively. For the nine months ended September 30, 2011 and 2010, we recorded a loss attributable to noncontrolling interests of $0.8 million and income attributable to noncontrolling interests of $2.4 million, respectively.

Fair Values of Financial Instruments

Fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, FASB guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels one and two of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within level three of the hierarchy).

Level one inputs utilize unadjusted quoted prices for identical assets or liabilities in active markets that the reporting entity has the ability to access. Level two inputs are inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets, as well as other inputs for the asset or liability, such as interest rates, foreign exchange rates and yield curves, that are observable at commonly quoted intervals. Level three inputs are unobservable inputs for the asset or liability, which are typically based on the reporting entity’s own assumptions, as there is little, if any, related market activity. If the determination of the fair value measurement is based on inputs from different levels of the hierarchy, the level within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

We use the following methods and assumptions in estimating fair value of financial instruments:

• Cash and cash equivalents: The carrying amount of unrestricted cash and cash equivalents reported on our Consolidated Balance Sheets approximates fair value due to the short maturity of these instruments.

• Loans receivable: We estimate the fair value of loans receivable by discounting future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The inputs used to measure the fair value of our loans receivable are level two and level three inputs. Additionally, we determine the valuation allowance for losses on loans receivable based on level three inputs.

• Marketable debt securities: We estimate the fair value of marketable debt securities using quoted prices for similar assets or liabilities in active markets that we have the ability to access. The inputs used to measure the fair value of our marketable debt securities are level two inputs.

• Derivative instruments: With the assistance of a third party, we estimate the fair value of our derivative instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, using level two inputs. We determine the fair value of interest rate caps using forward yield curves and other relevant information. We estimate the fair value of interest rate swaps using alternative financing rates derived from market-based financing rates, forward yield curves and discount rates. We determine the fair value of foreign currency forward contracts by estimating the future values of the two currency tranches using forward exchange rates that are based on traded forward points and calculating a present value of the net amount using a discount factor based on observable traded interest rates.

• Senior notes payable and other debt: We estimate the fair value of borrowings by discounting the future cash flows using current interest rates at which we could make similar borrowings. The inputs used to measure the fair value of our senior notes payable and other debt are level two inputs.

• Contingent consideration: We estimate the fair value of contingent consideration using probability assessments of expected future cash flows over the period in which the obligation is expected to be settled, and by applying a discount rate that appropriately captures a market participant’s view of the risk associated with the obligation. The inputs we use to determine the fair value of contingent consideration are considered level three inputs.

• Redeemable OP unitholder interests: We estimate the fair value of redeemable OP unitholder interests based on the closing price of our common stock, as the OP Units may be redeemed, at the election of the holder, for cash or, at our option, 0.7866 shares of our common stock, subject to adjustment in certain circumstances. The inputs used to measure the fair value of redeemable OP unitholder interests are level two inputs.

Recently Issued or Adopted Accounting Standards

In September 2011, the FASB issued Accounting Standards Update (“ASU”) 2011-08, Testing Goodwill for Impairment (“ASU 2011-08”), which permits companies to first assess qualitative factors to determine the likelihood that the fair value of a reporting unit is less than its carrying amount, before performing the current two-step analysis. If a company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the company must proceed with the two-step approach to evaluating impairment. The provisions of ASU 2011-08 will be effective for us beginning with the first quarter of 2012, but we do not expect ASU 2011-08 to have a significant impact on our Consolidated Financial Statements. Also, on January 1, 2011, we adopted ASU 2010-28, When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts (“ASU 2010-28”). ASU 2010-28 states that if a reporting unit has a carrying amount that is equal to or less than zero and there are qualitative factors that indicate it is more likely than not that a goodwill impairment exists, Step 2 of the goodwill impairment test must be performed. The adoption of ASU 2010-28 did not impact our Consolidated Financial Statements.

In June 2011, the FASB issued ASU 2011-05, Presentation of Comprehensive Income (“ASU 2011-05”), which amends current guidance found in ASC Topic 220, Comprehensive Income. ASU 2011-05 requires entities to present comprehensive income in either: (i) one continuous financial statement or (ii) two separate but consecutive statements that display net income and the components of other comprehensive income. Totals and individual components of both net income and other comprehensive income must be included in either presentation. The provisions of ASU 2011-05 will be effective for us beginning with the first quarter of 2012.

On January 1, 2011, we adopted ASU 2010-29, Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations (“ASU 2010-29”), affecting public entities who enter into business combinations that are material on an individual or aggregate basis. ASU 2010-29 specifies that a public entity presenting comparative financial statements should disclose revenues and earnings of the combined entity as though the business combination(s) that occurred during the year had occurred at the beginning of the prior annual reporting period when preparing the pro forma financial information for both the current and prior reporting periods. This guidance, which is effective for business combinations consummated in reporting periods beginning after December 15, 2010, also requires that pro forma disclosures be accompanied by a narrative description regarding the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination(s) included in reported pro forma revenues and earnings. We have presented supplementary pro forma information related to our acquisition of substantially all of the real estate assets and working capital of Atria Senior Living Group, Inc. (together with its affiliates, “Atria Senior Living”) in May 2011 and our acquisition of NHP in July 2011 in “Note 4—Acquisitions of Real Estate Property.”

In January 2010, the FASB issued ASU 2010-06, Improving Disclosures about Fair Value Measurements (“ASU 2010-06”), which expands required disclosures related to an entity’s fair value measurements. Certain provisions of ASU 2010-06 are effective for interim and annual reporting periods beginning after December 15, 2009, and we adopted those provisions as of January 1, 2010. The remaining provisions, which are effective for interim and annual reporting periods beginning after December 15, 2010, require additional disclosures related to purchases, sales, issuances and settlements in an entity’s reconciliation of recurring level three investments. We adopted those provisions of ASU 2010-06 as of January 1, 2011. The adoption of ASU 2010-06 did not impact our Consolidated Financial Statements.

XML

Senior Notes Payable and Other Debt (Details Textuals) (USD $)	1 Months Ended		3 Months Ended		9 Months Ended														1 Months Ended									1 Months Ended							9 Months Ended						1 Months Ended		9 Months Ended			1 Months Ended	9 Months Ended		9 Months Ended
	Oct. 31, 2011	Jun. 30, 2011	Sep. 30, 2011 Property State Year Province License LeaseRenewal	Mar. 31, 2011	Sep. 30, 2011 Segment Property Year State Province License LeaseRenewal	Sep. 30, 2010	Oct. 20, 2011	Dec. 31, 2010 Year Property	Dec. 31, 2009	Sep. 30, 2011 3 7/8 % Convertible Senior Notes due 2011 [Member]	Dec. 31, 2010 3 7/8 % Convertible Senior Notes due 2011 [Member]	Sep. 30, 2011 9% Senior Notes due 2012 [Member]	Dec. 31, 2010 9% Senior Notes due 2012 [Member]	Sep. 30, 2011 3.125% Senior Notes due 2015 [Member]	Dec. 31, 2010 3.125% Senior Notes due 2015 [Member]	Sep. 30, 2011 8 1/4% Senior Notes due 2012 [Member]	Sep. 30, 2011 6.25% Senior Notes due 2013 [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] 6.90% Senior Notes due 2037 (Member)	Jul. 31, 2011 6 1/2% Senior Notes due 2016 [Member]	Sep. 30, 2011 6 1/2% Senior Notes due 2016 [Member]	Dec. 31, 2010 6 1/2% Senior Notes due 2016 [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] 6.59% senior notes due 2038 [Member]	Sep. 30, 2011 6.90% Senior Notes due 2037 [Member]	Sep. 30, 2011 6.59% Senior Notes due 2038 [Member]	Sep. 30, 2011 6% Senior Notes due 2015 [Member]	Sep. 30, 2011 6 3/4% Senior Notes due 2017 [Member]	Dec. 31, 2010 6 3/4% Senior Notes due 2017 [Member]	Jul. 31, 2011 Nationwide Health Properties [Member] 6.50% senior notes due 2011 [Member]	May 31, 2011 4.750% Senior Notes due 2021 [Member]	Sep. 30, 2011 4.750% Senior Notes due 2021 [Member]	Sep. 30, 2011 Unsecured Revolving Credit Facilities [Member] 2012 maturities [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Unsecured Revolving Credit Facilities [Member] LIBOR plus 1.50% [Member]	Jul. 31, 2011 Nationwide Health Properties [Member] LIBOR plus 1.50% [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Alternate Base Rate plus 0.50% [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Senior Notes [Member]	Nov. 02, 2011 Unsecured term loan due 2012 [Member]	Sep. 30, 2011 Unsecured term loan due 2012 [Member]	Oct. 20, 2011 Letter of Credit [Member]	Oct. 20, 2011 Swingline Loans [Member]	Oct. 20, 2011 Loans In Alternative Currencies [Member]	Oct. 31, 2011 Minimum [Member] Unsecured Revolving Credit Facilities [Member]	Oct. 31, 2011 Maximum [Member] Unsecured Revolving Credit Facilities [Member]	Sep. 30, 2011 Unsecured Revolving Credit Facilities [Member]	Nov. 02, 2011 Unsecured Revolving Credit Facilities [Member]	Oct. 20, 2011 Unsecured Revolving Credit Facilities [Member]	Oct. 31, 2011 Nationwide Health Properties [Member] Senior unsecured term loan [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Senior unsecured term loan [Member]	May 31, 2011 Senior unsecured term loan [Member]	Sep. 30, 2011 Atria Senior Living Acquisition [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Property HousingCommunity	Jul. 31, 2011 Nationwide Health Properties [Member]
Debt Instrument [Line Items]
Portion of Credit Facility Interest Rate Based on Consolidated Leverage																															2.80%
Letters of Credit Outstanding on Credit Facility																																											$ 8,300,000
Unsecured revolving credit facilities available																																											517,700,000,000
Senior unsecured term loan																																															800,000,000	600,000,000
Outstanding senior unsecured term loan																																															250,000,000
Facility fee on unused commitments under term loan agreement					0.10%																																				0.15%	0.45%				0.25%
Line of credit facility repayment and termination date																																											Oct. 18, 2011
New unsecured credit facility maturity date																																											October 16, 2015
Balance outstanding of unsecured term loan																																					250,000,000							727,000,000			250,000,000
Line of credit facility optional extension period																																											1 year
Senior notes interest rate, Minimum																																			6.00%
Senior notes interest rate, Maximum																																			8.25%
Percentage of LIBOR										3.875%		9.00%		3.125%		8.25%	6.25%	6.90%		6.50%		6.59%	6.90%	6.59%	6.00%	6.75%				4.75%		1.69%	1.50%	0.50%											1.00%			5.00%
Mortgage debt in connection with acquisition		12,900,000																																															1,200,000,000	400,000,000
Aggregate principal amount of senior notes																		52,400,000				23,000,000							700,000,000																						991,600,000
Public Offering Price as a Percent of Par																													99.132%
Mortgage loans repaid in full					307,200,000
Loss on extinguishment of debt			8,685,000	16,500,000	25,211,000	6,549,000													8,700,000
Repayments of Senior Debt																			200,000,000									339,000,000
Early Repayment of Senior Debt																			206,500,000
Senior Note Redemption Price as a Percent of Par																			103.25%
No of housing communities owned																																																		8
Capital lease obligations			143,119,000		143,119,000
Proceeds from public offering																													693,900,000
Facility fee on unsecured revolving credit facilities																																											0.20%
LIBOR																																															LIBOR
Interest rate of term loan, maximum																																															1.69%
Interest rate of term loan, minimum																																															1.50%
Percentage of federal funds rate plus																																													0.50%
Percentage of euro currency rate loan																																													1.25%
Percentage of euro currency base rate loan																																													0.25%
Unsecured revolving credit facility outstanding																																												8,000,000
Unsecured revolving credit facility available																																				550,000,000	550,000,000							1,260,000,000
Aggregate borrowing capacity under the Unsecured Revolving Credit Facilities			1,000,000,000		1,000,000,000		2,500,000,000																															200,000,000	200,000,000	250,000,000
Senior Notes Payable and Other Debt (Textuals) [Abstract]
Aggregate borrowing capacity under the Unsecured Revolving Credit Facilities, Current							2,000,000,000
Unrestricted cash and cash equivalents			57,482,000		57,482,000	33,790,000		21,812,000	107,397,000
Net of Unrestricted Cash and Cash Equivalents and Unsecured Revolving Credit Facilities			416,500,000		416,500,000
Number of properties owned through consolidated joint ventures with mortgage debt			7		7			3
Percentage Of Line Of Credit Facility For Negotiated Rate Loans	50.00%
Joint venture partners' share of total debt			45,900,000		45,900,000			4,800,000
Line of credit			474,000,000,000		474,000,000,000			40,000,000
Debt related to investments in unconsolidated entities			131,700,000		131,700,000			45,900,000
Senior Notes										230,000,000	230,000,000	82,433,000	82,433,000	400,000,000	400,000,000	72,950,000	269,850,000			200,000,000	400,000,000		52,400,000	22,973,000	234,420,000	225,000,000	225,000,000			700,000,000
Net Assets held under capital leases			$ 226,900,000		$ 226,900,000			$ 0

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Acquisitions of Real Estate Property

9 Months Ended

Sep. 30, 2011

Acquisitions of Real Estate Property [Abstract]

ACQUISITIONS OF REAL ESTATE PROPERTY

NOTE 4 — ACQUISITIONS OF REAL ESTATE PROPERTY

We engage in acquisition activity primarily to invest in additional seniors housing and healthcare properties and achieve an expected yield on investment, to grow and diversify our portfolio and revenue base and to reduce our dependence on any single operator, geographic area, asset type or revenue source.

Atria Senior Living Acquisition

On May 12, 2011, we acquired substantially all of the real estate assets and working capital of privately-owned Atria Senior Living. We funded a portion of the purchase price through the issuance of 24.96 million shares of our common stock (which shares had a total value of $1.38 billion based on the May 12, 2011 closing price of our common stock of $55.33 per share). Subsequent to September 30, 2011, we cancelled 83,441 shares issued to the sellers for a working capital adjustment in accordance with the purchase agreement. As a result of the transaction, we added to our senior living operating portfolio 117 private pay seniors housing communities and one development land parcel located primarily in affluent coastal markets such as the New York metropolitan area, New England and California. Prior to the closing, Atria Senior Living spun off its management operations to a newly formed entity, Atria, which continues to operate the acquired assets under long-term management agreements with us. For the three months ended September 30, 2011 and for the period from May 12, 2011 through September 30, 2011, revenues attributable to the acquired assets were $157.1 million and $242.8 million, respectively, and NOI attributable to the acquired assets was $47.5 million and $73.7 million, respectively.

We are accounting for the Atria Senior Living acquisition under the acquisition method in accordance with ASC Topic 805, Business Combinations (“ASC 805”), and our initial accounting for this acquisition is essentially complete. The following table summarizes the acquisition date fair values of the assets acquired and liabilities assumed, which we determined using level two and level three inputs (in thousands):

Land and improvements	$	342,330
Buildings and improvements		2,878,807
Acquired lease intangibles		160,340
Other assets		213,325
Total assets acquired		3,594,802
Notes payable and other debt		1,629,212
Deferred tax liability		43,889
Other liabilities		203,082
Total liabilities assumed		1,876,183
Net assets acquired		1,718,619
Cash acquired		77,718
Equity issued		1,376,437
Total cash used	$	264,464

The allocation of fair values of the assets acquired and liabilities assumed has changed and is subject to further adjustment from the allocation reported in “Note 4—Acquisitions of Real Estate Property” of the Notes to Consolidated Financial Statements included in Part I of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2011, filed with the SEC on August 5, 2011, due primarily to reclassification adjustments for presentation, adjustments to our valuation assumptions and final purchase price settlement with the sellers in accordance with the terms of the acquisition agreement. The changes to our valuation assumptions were based on more accurate information concerning the subject assets and liabilities. None of these changes had a material impact on our Consolidated Financial Statements.

Included in other assets is $79.2 million of goodwill, which represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed as of the acquisition date. All of the goodwill was assigned to our senior living operations reportable segment, and we do not expect to deduct any of the goodwill balance for tax purposes.

As of September 30, 2011, we had incurred a total of $52.5 million of acquisition-related costs related to the Atria Senior Living acquisition, all of which were expensed as incurred and included in merger-related expenses and deal costs on our Consolidated Statements of Income for the applicable periods. For the three and nine months ended September 30, 2011, we expensed $1.5 million and $48.2 million, respectively, of acquisition-related costs related to the Atria Senior Living acquisition.

As partial consideration for the Atria Senior Living acquisition, the sellers received the right to earn additional amounts (“contingent consideration”) based upon the achievement of certain performance metrics, including the future operating results of the acquired assets, and other factors. The contingent consideration, if any, will be payable to the sellers following the applicable measurement date for the period ending December 31, 2014 or December 31, 2015, at the election of the sellers. We cannot determine the actual amount of contingent consideration, if any, that may become due to the sellers because it is dependent on various factors, such as the future performance of the acquired assets and our equity multiple, which are subject to many risks and uncertainties beyond our control. We are also unable to estimate a range of potential outcomes for the same reason. We estimated the fair value of contingent consideration as of the acquisition date and as of September 30, 2011 using probability assessments of expected future cash flows over the period in which the obligation is expected to be settled and applying a discount rate that appropriately captures a market participant’s view of the risk associated with the obligation. This contingent consideration liability is carried on our Consolidated Balance Sheets (in accounts payable and other liabilities) as of September 30, 2011 at its fair value, and we record any changes in fair value in earnings on our Consolidated Statements of Income. As of both September 30, 2011 and the acquisition date, the estimated fair value of contingent consideration was $44.2 million.

NHP Acquisition

On July 1, 2011, we acquired NHP in a stock-for-stock transaction. Pursuant to the terms and subject to the conditions set forth in the agreement and plan of merger dated as of February 27, 2011, at the effective time of the merger, each outstanding share of NHP common stock (other than shares owned by us or any of our subsidiaries or any wholly owned subsidiary of NHP) was converted into the right to receive 0.7866 shares of our common stock, with cash paid in lieu of fractional shares. In connection with the acquisition, we paid $105 million at closing to repay amounts then outstanding and terminated the commitments under NHP’s revolving credit facility. The NHP acquisition added 643 seniors housing and healthcare properties to our portfolio (including properties that are owned through joint ventures). For both the three and nine months ended September 30, 2011, revenues attributable to the acquired assets were $134.8 million and NOI attributable to the acquired assets was $122.9 million.

We are accounting for the NHP acquisition under the acquisition method in accordance with ASC 805, and we have completed our initial accounting for this acquisition, which is subject to further adjustment. The following table summarizes the acquisition date fair values of the assets acquired and liabilities assumed, which we determined using level two and level three inputs (in thousands):

Land and improvements	$	687,142
Buildings and improvements		6,414,258
Acquired lease intangibles		515,535
Other assets		701,743
Total assets acquired		8,318,678
Notes payable and other debt		1,879,014
Other liabilities		789,040
Total liabilities assumed		2,668,054
Redeemable OP unitholder interests assumed		100,429
Noncontrolling interest assumed		83,702
Net assets acquired		5,466,493
Cash acquired		29,202
Equity issued		5,361,493
Total cash used	$	75,798

Included in other assets is $189.6 million of goodwill, which represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed as of the acquisition date. We have allocated $129.4 million and $60.2 million of the goodwill balance to our triple-net leased properties and operating assets, respectively. We do not expect to deduct any of the goodwill balance for tax purposes.

As of September 30, 2011, we had incurred a total of $54.8 million of acquisition-related costs related to the NHP acquisition, all of which we expensed as incurred and included in merger-related expenses and deal costs on our Consolidated Statements of Income for the applicable periods. For the three and nine months ended September 30, 2011, we expensed $42.5 million and $54.8 million, respectively, of acquisition-related costs related to the NHP acquisition.

Other 2011 Acquisitions

In August 2011, we purchased one seniors housing community for a purchase price of $3.8 million. In October 2011, we purchased two MOBs and two seniors housing communities (one of which is being managed by Atria) for approximately $150.3 million, including the assumption of $37.7 million in debt.

Lillibridge Acquisition

On July 1, 2010, we completed the acquisition of businesses owned and operated by Lillibridge and its related entities and their real estate interests in 96 MOBs and ambulatory facilities for approximately $381 million, including the assumption of $79.5 million of mortgage debt.

As a result of the Lillibridge acquisition, we acquired: a 100% interest in Lillibridge’s property management, leasing, marketing, facility development, and advisory services business; a 100% interest in 38 MOBs; a 20% joint venture interest in 24 MOBs; and a 5% joint venture interest in 34 MOBs. We are the managing member of these joint ventures and the property manager for the joint venture properties. Two institutional third parties hold the controlling interests in these joint ventures, and we have a right of first offer on those interests. We funded the acquisition with cash on hand, borrowings under our unsecured revolving credit facilities and the assumption of mortgage debt. In connection with the acquisition, $132.7 million of mortgage debt was repaid.

Other 2010 Acquisitions

In December 2010, we acquired Sunrise’s noncontrolling interests in 58 of our seniors housing communities currently managed by Sunrise for a total valuation of approximately $186 million, including the assumption of Sunrise’s share of mortgage debt totaling approximately $144 million. The noncontrolling interests acquired represented between 15% and 25% ownership interests in the communities, and we now own 100% of all 79 of our Sunrise-managed seniors housing communities. We recorded the difference between the consideration paid and the noncontrolling interest balance as a component of equity in capital in excess of par value on our Consolidated Balance Sheets.

Also in December 2010, we purchased five MOBs for a purchase price of $36.6 million.

Unaudited Pro Forma

The following table illustrates the effect on net income and earnings per share as if we had consummated the Atria Senior Living and NHP acquisitions as of January 1, 2010:

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Revenues	$	565,424	$	556,779	$	1,698,376	$	1,625,552
Income from continuing operations attributable to common stockholders		183,517		90,891		399,249		280,216
Discontinued operations		—		542		—		7,139
Net income attributable to common stockholders		183,517		91,433		399,249		287,355
Earnings per common share:
Basic:
Income from continuing operations attributable to common stockholders	$	0.64	$	0.32	$	1.39	$	1.00
Discontinued operations		—		0.00		—		0.02
Net income attributable to common stockholders	$	0.64	$	0.32	$	1.39	$	1.02
Diluted:
Income from continuing operations attributable to common stockholders	$	0.63	$	0.32	$	1.38	$	0.99
Discontinued operations		—		0.00		—		0.03
Net income attributable to common stockholders	$	0.63	$	0.32	$	1.38	$	1.02
Weighted average shares used in computing earnings per common share:
Basic		287,365		281,439		286,647		281,374
Diluted		290,794		282,749		289,027		282,261

Acquisition-related costs related to the Atria Senior Living and NHP acquisitions are not expected to have a continuing significant impact and therefore have been excluded from these pro forma results. The pro forma results also do not include the impact of any synergies or lower borrowing costs that may be achieved as a result of the acquisitions or any strategies that management may consider in order to continue to efficiently manage our operations, nor do they give pro forma effect to any other acquisitions, dispositions or capital markets transactions that we completed during the periods presented. These pro forma results are not necessarily indicative of the operating results that would have been obtained had the Atria Senior Living and NHP acquisitions occurred at the beginning of the periods presented, nor are they necessarily indicative of future operating results.

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Acquisitions of Real Estate Property (Tables)

9 Months Ended

Sep. 30, 2011

Acquisitions of Real Estate Property [Abstract]

Fair values of the assets acquired and liabilities assumed at the date of acquisition

Land and improvements	$	342,330
Buildings and improvements		2,878,807
Acquired lease intangibles		160,340
Other assets		213,325
Total assets acquired		3,594,802
Notes payable and other debt		1,629,212
Deferred tax liability		43,889
Other liabilities		203,082
Total liabilities assumed		1,876,183
Net assets acquired		1,718,619
Cash acquired		77,718
Equity issued		1,376,437
Total cash used	$	264,464

Land and improvements	$	687,142
Buildings and improvements		6,414,258
Acquired lease intangibles		515,535
Other assets		701,743
Total assets acquired		8,318,678
Notes payable and other debt		1,879,014
Other liabilities		789,040
Total liabilities assumed		2,668,054
Redeemable OP unitholder interests assumed		100,429
Noncontrolling interest assumed		83,702
Net assets acquired		5,466,493
Cash acquired		29,202
Equity issued		5,361,493
Total cash used	$	75,798

The effect of material acquisitions on net income and earnings per share

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Revenues	$	565,424	$	556,779	$	1,698,376	$	1,625,552
Income from continuing operations attributable to common stockholders		183,517		90,891		399,249		280,216
Discontinued operations		—		542		—		7,139
Net income attributable to common stockholders		183,517		91,433		399,249		287,355
Earnings per common share:
Basic:
Income from continuing operations attributable to common stockholders	$	0.64	$	0.32	$	1.39	$	1.00
Discontinued operations		—		0.00		—		0.02
Net income attributable to common stockholders	$	0.64	$	0.32	$	1.39	$	1.02
Diluted:
Income from continuing operations attributable to common stockholders	$	0.63	$	0.32	$	1.38	$	0.99
Discontinued operations		—		0.00		—		0.03
Net income attributable to common stockholders	$	0.63	$	0.32	$	1.38	$	1.02
Weighted average shares used in computing earnings per common share:
Basic		287,365		281,439		286,647		281,374
Diluted		290,794		282,749		289,027		282,261

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Intangibles (Details) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2011 Property State Year Province License LeaseRenewal	Sep. 30, 2010	Sep. 30, 2011 Segment Property Year State Province License LeaseRenewal	Sep. 30, 2010	Dec. 31, 2010 Property Year
Intangible Assets:
Above market lease intangibles	$ 203,460,000		$ 203,460,000		$ 13,232,000
In-place and other lease intangibles	618,153,000		618,153,000		133,582,000
Other intangibles	16,453,000		16,453,000		13,649,000
Accumulated amortization	(152,486,000)		(152,486,000)		(100,808,000)
Goodwill	288,196,000		288,196,000		19,901,000
Net Intangible Assets	973,776,000		973,776,000		79,556,000
Remaining weighted average amortization period of lease-related intangible assets in years			19.6		18.5
Intangible Liabilities:
Below market lease intangibles	486,228,000		486,228,000		22,398,000
Other lease intangibles	157,971,000		157,971,000
Accumulated amortization	(26,425,000)		(26,425,000)		(12,495,000)
Net Intangible Liabilities	617,774,000		617,774,000		9,903,000
Remaining weighted average amortization period of lease-related intangible liabilities in years	18.5		18.5		6.9
Intangibles (Textuals) [Abstract]
Net amortization expense	23,900,000	2,300,000	40,000,000	5,700,000
Estimated net amortization of the intangibles during 2012			76,100,000
Estimated net amortization of the intangibles during 2013			18,400,000
Estimated net amortization of the intangibles during 2014			15,000,000
Estimated net amortization of the intangibles during 2015			8,900,000
Estimated net amortization of the intangibles during 2016			$ 7,000,000

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Acquisitions of Real Estate Property (Details) (USD $) In Thousands	Sep. 30, 2011
Atria Senior Living Acquisition [Member]
Fair values of the assets acquired and liabilities assumed at the date of acquisition
Land and improvements	$ 342,330
Buildings and improvements	2,878,807
Acquired lease intangibles	160,340
Other assets	213,325
Total assets acquired	3,594,802
Notes payable and other debt	1,629,212
Deferred tax liability	43,889
Other liabilities	203,082
Total liabilities assumed	1,876,183
Net assets acquired	1,718,619
Cash acquired	77,718
Equity issued	1,376,437
Total cash used	264,464
Nationwide Health Properties [Member]
Fair values of the assets acquired and liabilities assumed at the date of acquisition
Land and improvements	687,142
Buildings and improvements	6,414,258
Acquired lease intangibles	515,535
Other assets	701,743
Total assets acquired	8,318,678
Notes payable and other debt	1,879,014
Other liabilities	789,040
Total liabilities assumed	2,668,054
Redeemable OP unitholder interests assumed	100,429
Noncontrolling interest assumed	83,702
Net assets acquired	5,466,493
Cash acquired	29,202
Equity issued	5,361,493
Total cash used	$ 75,798

XML

Condensed Consolidating Information

9 Months Ended

Sep. 30, 2011

Condensed Consolidating Information [Abstract]

CONDENSED CONSOLIDATING INFORMATION

NOTE 17 — CONDENSED CONSOLIDATING INFORMATION

At the time of initial issuance, we and certain of our direct and indirect wholly owned subsidiaries (the “Wholly Owned Subsidiary Guarantors”) fully and unconditionally guaranteed, on a joint and several basis, the obligation to pay principal and interest with respect to the 9% senior notes due 2012, the 6¹/2% senior notes due 2016 and the 6³/4% senior notes due 2017 of our wholly owned subsidiaries, Ventas Realty, Limited Partnership (“Ventas Realty”) and Ventas Capital Corporation (collectively, the “Ventas Issuers”). Ventas Capital Corporation is a direct subsidiary of Ventas Realty that was formed in 2002 to facilitate offerings of the senior notes and has no assets or operations. In addition, at the time of initial issuance, Ventas Realty and the Wholly Owned Subsidiary Guarantors fully and unconditionally guaranteed, on a joint and several basis, the obligation to pay principal and interest with respect to our 3⁷/₈% convertible senior notes due 2011. Other subsidiaries (“Non-Guarantor Subsidiaries”) that were not included among the Wholly Owned Subsidiary Guarantors were not obligated with respect to the senior notes or the convertible notes. On September 30, 2010, the Wholly Owned Subsidiary Guarantors were released from their obligations with respect to the 6¹/2% senior notes due 2016 and the 6³/4% senior notes due 2017 of the Ventas Issuers and our convertible notes pursuant to the terms of the applicable indentures.

In connection with the NHP acquisition, our wholly owned subsidiary, Nationwide Health Properties, LLC, assumed the obligation to pay principal and interest with respect to the 8¹/4% senior notes due 2012, the 6.25% senior notes due 2013, the 6.00% senior notes due 2015, the 6.90% senior notes due 2037 and the 6.59% senior notes due 2038 of NHP. We, the Ventas Issuers and our subsidiaries (other than Nationwide Health Properties, LLC) are not obligated with respect to the NHP senior notes.

Contractual and legal restrictions, including those contained in the instruments governing our subsidiaries’ outstanding mortgage indebtedness, may under certain circumstances restrict our ability to obtain cash from our subsidiaries for the purpose of meeting our debt service obligations, including our guarantee of payment of principal and interest on the Ventas Issuers’ senior notes and our primary obligation to pay principal and interest on our convertible notes. Certain of our real estate assets are also subject to mortgages.

The following summarizes our condensed consolidating information as of September 30, 2011 and December 31, 2010 and for the three and nine months ended September 30, 2011 and 2010:

CONDENSED CONSOLIDATING BALANCE SHEET
As of September 30, 2011

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor		Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries		Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	464		$	3,388,426	$	566,852		$	12,461,886	$	—		$	16,417,628
Cash and cash equivalents		2,252			24,898		—			30,332		—			57,482
Escrow deposits and restricted cash		1,961			25,901		7,131			49,790		—			84,783
Deferred financing costs, net		2,914			725		2,298			6,487		—			12,424
Investment in and advances to affiliates		8,441,898			—		1,728,685			—		(10,170,583	)		—
Other assets		67,190			196,204		8,134			361,925		—			633,453
Total assets	$	8,516,679		$	3,636,154	$	2,313,100		$	12,910,420	$	(10,170,583	)	$	17,205,770
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	229,363		$	235,185	$	2,240,589		$	3,608,004	$	—		$	6,313,141
Intercompany loans		(211,796	)		843,546		(670,085	)		38,335		—			—
Accrued interest		(218	)		744		40,093			25,366		—			65,985
Accounts payable and other liabilities		95,091			174,086		17,867			841,662		—			1,128,706
Deferred income taxes		274,852			—		—			—		—			274,852
Total liabilities		387,292			1,253,561		1,628,464			4,513,367		—			7,782,684
Redeemable OP unitholder interests		—			—		—			92,817		—			92,817
Total equity		8,129,387			2,382,593		684,636			8,304,236		(10,170,583	)		9,330,269
Total liabilities and equity	$	8,516,679		$	3,636,154	$	2,313,100		$	12,910,420	$	(10,170,583	)	$	17,205,770

CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2010

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	937		$	3,244,243	$	688,158		$	1,510,776		$	—		$	5,444,114
Cash and cash equivalents		1,083			15,659		—			5,070			—			21,812
Escrow deposits and restricted cash		76			19,786		9,169			9,909			—			38,940
Deferred financing costs, net		2,691			1,961		7,961			6,920			—			19,533
Investment in and advances to affiliates		1,414,170			—		1,028,721			—			(2,442,891	)		—
Other assets		75,794			119,773		8,057			29,998			—			233,622
Total assets	$	1,494,751		$	3,401,422	$	1,742,066		$	1,562,673		$	(2,442,891	)	$	5,758,021
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	225,644		$	539,564	$	1,301,089		$	833,747		$	—		$	2,900,044
Intercompany loans		(144,897	)		586,605		(434,454	)		(7,254	)		—			—
Accrued interest		(113	)		2,704		12,852			3,853			—			19,296
Accounts payable and other liabilities		41,355			103,444		15,712			46,632			—			207,143
Deferred income taxes		241,333			—		—			—			—			241,333
Total liabilities		363,322			1,232,317		895,199			876,978			—			3,367,816
Total equity		1,131,429			2,169,105		846,867			685,695			(2,442,891	)		2,390,205
Total liabilities and equity	$	1,494,751		$	3,401,422	$	1,742,066		$	1,562,673		$	(2,442,891	)	$	5,758,021

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Three Months Ended September 30, 2011

				Wholly
				Owned				Non-
				Subsidiary		Ventas		Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers		Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	623		$	55,453	$	71,611	$	142,190		$	—		$	269,877
Resident fees and services		—			100,885		—		175,479			—			276,364
Medical office building and other services revenues		—			8,162		—		1,109			—			9,271
Income from loans and investments		1,124			428		103		8,417			—			10,072
Equity earnings in affiliates		52,119			258		—		—			(52,377	)		—
Interest and other income		6			7		10		350			—			373
Total revenues		53,872			165,193		71,724		327,545			(52,377	)		565,957
Expenses:
Interest		392			14,241		21,952		37,171			—			73,756
Depreciation and amortization		440			34,908		8,795		116,884			—			161,027
Property-level operating expenses		—			78,415		115		130,631			—			209,161
Medical office building services costs		—			6,347		—		—			—			6,347
General, administrative and professional fees		1,194			9,074		6,427		3,929			—			20,624
Loss on extinguishment of debt		—			—		8,685		—			—			8,685
Litigation proceeds, net		(85,327	)		—		—		—			—			(85,327	)
Merger-related expenses and deal costs		47,309			674		—		21,367			—			69,350
Other		883			1,863		—		11,690			—			14,436
Total expenses		(35,109	)		145,522		45,974		321,672			—			478,059
Income from continuing operations before gain from unconsolidated entities, income taxes and noncontrolling interest		88,981			19,671		25,750		5,873			(52,377	)		87,898
Gain from unconsolidated entities		—			—		61		121			—			182
Income tax benefit		13,904			—		—		—			—			13,904
Net income		102,885			19,671		25,811		5,994			(52,377	)		101,984
Net loss attributable to noncontrolling interest, net of tax		—			—		—		(901	)		—			(901	)
Net income attributable to common stockholders	$	102,885		$	19,671	$	25,811	$	6,895		$	(52,377	)	$	102,885

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Three Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	607		$	52,463		$	70,534		$	17,119		$	—		$	140,723
Resident fees and services		—			65,252			—			47,930			—			113,182
Medical office building and other services revenues		—			6,711			—			—			—			6,711
Income from loans and investments		1,406			755			1,853			—			—			4,014
Equity earnings in affiliates		61,077			439			—			—			(61,516	)		—
Interest and other income		18			4			21			(8	)		—			35
Total revenues		63,108			125,624			72,408			65,041			(61,516	)		264,665
Expenses:
Interest		820			18,386			13,261			13,052			—			45,519
Depreciation and amortization		412			28,889			9,296			13,507			—			52,104
Property-level operating expenses		—			46,908			134			34,965			—			82,007
Medical office building services costs		—			4,633			—			—			—			4,633
General, administrative and professional fees		203			8,311			5,575			1,189			—			15,278
Merger-related expenses and deal costs		3,573			1,569			—			—			—			5,142
Other		(477	)		60			—			(2	)		—			(419	)
Total expenses		4,531			108,756			28,266			62,711			—			204,264
Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		58,577			16,868			44,142			2,330			(61,516	)		60,401
Loss from unconsolidated entities		—			—			(392	)		—			—			(392	)
Income tax expense		(679	)		(978	)		—			—			—			(1,657	)
Income from continuing operations		57,898			15,890			43,750			2,330			(61,516	)		58,352
Discontinued operations		—			422			120			—			—			542
Net income		57,898			16,312			43,870			2,330			(61,516	)		58,894
Net income attributable to noncontrolling interest, net of tax		—			352			—			644			—			996
Net income attributable to common stockholders	$	57,898		$	15,960		$	43,870		$	1,686		$	(61,516	)	$	57,898

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Nine Months Ended September 30, 2011

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	1,848		$	165,454	$	212,653		$	176,648		$	—		$	556,603
Resident fees and services		—			252,803		—			340,545			—			593,348
Medical office building and other services revenues		—			24,941		—			1,109			—			26,050
Income from loans and investments		5,070			2,495		8,566			8,417			—			24,548
Equity earnings in affiliates		160,275			1,102		—			—			(161,377	)		—
Interest and other income		96			19		52			362			—			529
Total revenues		167,289			446,814		221,271			527,081			(161,377	)		1,201,078
Expenses:
Interest		(474	)		45,409		53,457			71,654			—			170,046
Depreciation and amortization		1,273			95,651		26,706			169,911			—			293,541
Property-level operating expenses		—			192,137		414			248,414			—			440,965
Medical office building services costs		—			19,837		—			—			—			19,837
General, administrative and professional fees		(5,840	)		28,101		21,625			7,124			—			51,010
Loss on extinguishment of debt		—			16,526		8,685			—			—			25,211
Litigation proceeds, net		(85,327	)		—		—			—			—			(85,327	)
Merger-related expenses and deal costs		108,509			1,730		—			21,367			—			131,606
Other		913			2,950		—			2,801			—			6,664
Total expenses		19,054			402,341		110,887			521,271			—			1,053,553
Income from continuing operations before (loss) income from unconsolidated entities, income taxes and noncontrolling interest		148,235			44,473		110,384			5,810			(161,377	)		147,525
(Loss) income from unconsolidated entities		—			—		(192	)		121			—			(71	)
Income tax benefit		23,310			—		—			—			—			23,310
Net income		171,545			44,473		110,192			5,931			(161,377	)		170,764
Net income attributable to noncontrolling interest, net of tax		—			—		—			(781	)		—			(781	)
Net income attributable to common stockholders	$	171,545		$	44,473	$	110,192		$	6,712		$	(161,377	)	$	171,545

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Nine Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor		Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries		Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	1,802		$	141,317		$	209,879		$	45,873	$	—		$	398,871
Resident fees and services		—			190,801			—			140,734		—			331,535
Medical office building and other services revenues		—			6,711			—			—		—			6,711
Income from loans and investments		4,247			1,635			5,454			—		—			11,336
Equity earnings in affiliates		176,659			1,307			—			—		(177,966	)		—
Interest and other income		310			40			63			7		—			420
Total revenues		183,018			341,811			215,396			186,614		(177,966	)		748,873
Expenses:
Interest		1,096			56,371			39,658			36,324		—			133,449
Depreciation and amortization		1,219			84,084			28,429			40,726		—			154,458
Property-level operating expenses		—			132,036			398			103,635		—			236,069
Medical office building services costs		—			4,633			—			—		—			4,633
General, administrative and professional fees		323			16,870			15,414			3,212		—			35,819
Loss on extinguishment of debt		—			102			6,447			—		—			6,549
Merger-related expenses and deal costs		10,041			1,617			—			10		—			11,668
Other		(435	)		31			—			—		—			(404	)
Total expenses		12,244			295,744			90,346			183,907		—			582,241
Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		170,774			46,067			125,050			2,707		(177,966	)		166,632
Loss from unconsolidated entities		—			—			(392	)		—		—			(392	)
Income tax expense		(2,190	)		(162	)		—			—		—			(2,352	)
Income from continuing operations		168,584			45,905			124,658			2,707		(177,966	)		163,888
Discontinued operations		—			1,132			6,007			—		—			7,139
Net income		168,584			47,037			130,665			2,707		(177,966	)		171,027
Net income attributable to noncontrolling interest, net of tax		—			1,134			—			1,309		—			2,443
Net income attributable to common stockholders	$	168,584		$	45,903		$	130,665		$	1,398	$	(177,966	)	$	168,584

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Nine Months Ended September 30, 2011

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination		Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(3,510	)	$	107,282		$	180,935		$	159,194		$	—	$	443,901
Net cash (used in) provided by investing activities		(431,727	)		89,296			(500,879	)		386			—		(842,924	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		—			—			434,000			—			—		434,000
Proceeds from debt		—			—			689,374			268,379			—		957,753
Repayment of debt		—			(328,691	)		(206,500	)		(359,852	)		—		(895,043	)
Net change in intercompany debt		981,494			84,585			(1,208,212	)		142,133			—		—
Payment of deferred financing costs		—			—			(1,519	)		(379	)		—		(1,898	)
Issuance of common stock, net		299,926			—			—			—			—		299,926
Cash distribution (to) from affiliates		(491,099	)		56,767			612,898			(178,566	)		—		—
Cash distribution to common stockholders		(354,932	)		—			—			—			—		(354,932	)
Cash distribution to redeemable OP unitholders		—			—			—			(4,038	)		—		(4,038	)
Contributions from noncontrolling interest		—			—			—			2			—		2
Distributions to noncontrolling interest		—			—			—			(1,997	)		—		(1,997	)
Other		1,017			—			—			—			—		1,017
Net cash provided by (used in) financing activities		436,406			(187,339	)		320,041			(134,318	)		—		434,790
Net increase in cash and cash equivalents		1,169			9,239			97			25,262			—		35,767
Effect of foreign currency translation on cash and cash equivalents		—			—			(97	)		—			—		(97	)
Cash and cash equivalents at beginning of period		1,083			15,659			—			5,070			—		21,812
Cash and cash equivalents at end of period	$	2,252		$	24,898		$	—		$	30,332		$	—	$	57,482

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Nine Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination		Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(864	)	$	118,174		$	179,105		$	49,704		$	—	$	346,119
Net cash used in investing activities		—			(57,096	)		(207,509	)		(3,871	)		—		(268,476	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		—			102,004			131,000			—			—		233,004
Proceeds from debt		—			—			200,000			1,237			—		201,237
Repayment of debt		—			(144,739	)		(178,139	)		(8,500	)		—		(331,378	)
Net change in intercompany debt		48,748			(59,452	)		10,704			—			—		—
Payment of deferred financing costs		—			(46	)		(1,826	)		—			—		(1,872	)
Cash distribution from (to) affiliates		199,706			50,104			(216,290	)		(33,520	)		—		—
Cash distribution to common stockholders		(251,921	)		—			—			—			—		(251,921	)
Contributions from noncontrolling interest		—			—			—			818			—		818
Distributions to noncontrolling interest		—			—			—			(6,633	)		—		(6,633	)
Other		5,426			—			—			—			—		5,426
Net cash provided by (used in) financing activities		1,959			(52,129	)		(54,551	)		(46,598	)		—		(151,319	)
Net increase (decrease) in cash and cash equivalents		1,095			8,949			(82,955	)		(765	)		—		(73,676	)
Effect of foreign currency translation on cash and cash equivalents		—			—			69			—			—		69
Cash and cash equivalents at beginning of period		—			7,864			82,886			16,647			—		107,397
Cash and cash equivalents at end of period	$	1,095		$	16,813		$	—		$	15,882		$	—	$	33,790

XML

Fair Values of Financial Instruments

9 Months Ended

Sep. 30, 2011

Fair Values of Financial Instruments [Abstract]

FAIR VALUES OF FINANCIAL INSTRUMENTS

NOTE 9 — FAIR VALUES OF FINANCIAL INSTRUMENTS

As of September 30, 2011 and December 31, 2010, the carrying amounts and fair values of our financial instruments were as follows:

	September 30, 2011				December 31, 2010
	Carrying				Carrying
	Amount		Fair Value		Amount		Fair Value
	(In thousands)
Assets:
Cash and cash equivalents	$	57,482	$	57,482	$	21,812	$	21,812
Secured loans receivable, net		302,264		302,393		149,263		155,377
Derivative instruments		8,536		8,536		99		99
Marketable debt securities		42,788		42,788		66,675		66,675
Unsecured loans receivable, net		65,384		65,384		—		—
Liabilities:
Senior notes payable and other debt, gross		6,065,856		6,415,640		2,926,954		3,055,435
Derivative instruments		24,537		24,537		3,722		3,722
Contingent consideration liabilities		56,218		56,218		—		—
Redeemable OP unitholder interests		92,817		92,817		—		—

Fair value estimates are subjective in nature and depend upon several important assumptions, including estimates of future cash flows, risks, discount rates and relevant comparable market information associated with each financial instrument. The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the estimates presented above are not necessarily indicative of the amounts we would realize in a current market exchange.

At September 30, 2011, we held corporate marketable debt securities, classified as available-for-sale and included within other assets on our Consolidated Balance Sheets, having an aggregate amortized cost basis and fair value of $41.0 million and $42.8 million, respectively. At December 31, 2010, our marketable debt securities had an aggregate amortized cost basis and fair value of $61.9 million and $66.7 million, respectively. The contractual maturities of our marketable debt securities range from October 1, 2012 to April 15, 2016. In the first quarter of 2011, we sold certain marketable debt securities and received proceeds of approximately $23.1 million. We recognized aggregate gains from these sales of approximately $1.8 million (included in income from loans and investments on our Consolidated Statements of Income) during the first quarter of 2011.

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Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands	9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010
Cash flows from operating activities:
Net income	$ 170,764	$ 171,027
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization (including amounts in discontinued operations)	293,541	154,922
Amortization of deferred revenue and lease intangibles, net	(15,454)	(4,580)
Other non-cash amortization	(6,185)	6,455
Change in fair value of financial instruments	2,898
Stock-based compensation	13,596	10,128
Straight-lining of rental income, net	(9,254)	(7,975)
Loss on extinguishment of debt	25,211	6,549
Net gain on sale of real estate assets (including amounts in discontinued operations)		(5,393)
Gain on real estate loan investments	(3,255)
Gain on sale of marketable securities	(733)
Income tax (benefit) expense	(23,310)	2,352
Loss from unconsolidated entities	71	392
Other	2,004	(8)
Changes in operating assets and liabilities:
Increase in other assets	(27,009)	(9,017)
Increase in accrued interest	19,141	15,763
Increase in accounts payable and other liabilities	1,875	5,504
Net cash provided by operating activities	443,901	346,119
Cash flows from investing activities:
Net investment in real estate property	(344,687)	(239,157)
Purchase of noncontrolling interest	(3,319)
Investment in loans receivable	(619,859)	(38,725)
Proceeds from real estate disposals	14,961	25,597
Proceeds from loans receivable	138,934	1,552
Proceeds from sale of marketable securities	23,050
Development project expenditures	(23,233)	(1,649)
Capital expenditures	(28,658)	(11,594)
Other	(113)	(4,500)
Net cash used in investing activities	(842,924)	(268,476)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities	434,000	233,004
Proceeds from debt	957,753	201,237
Repayment of debt	(895,043)	(331,378)
Payment of deferred financing costs	(1,898)	(1,872)
Issuance of common stock, net	299,926
Cash distribution to common stockholders	(354,932)	(251,921)
Cash distribution to redeemable OP unitholders	(4,038)
Contributions from noncontrolling interest	2	818
Distributions to noncontrolling interest	(1,997)	(6,633)
Other	1,017	5,426
Net cash provided by (used in) financing activities	434,790	(151,319)
Net increase (decrease) in cash and cash equivalents	35,767	(73,676)
Effect of foreign currency translation on cash and cash equivalents	(97)	69
Cash and cash equivalents at beginning of period	21,812	107,397
Cash and cash equivalents at end of period	57,482	33,790
Assets and liabilities assumed from acquisitions:
Real estate investments	11,034,620	125,846
Other assets acquired	431,679	(385)
Debt assumed	3,508,226	125,320
Other liabilities	992,122	141
Deferred income tax liability	43,889
Redeemable OP unitholder interests	100,430
Noncontrolling interests	83,702
Equity issued	$ 6,737,930

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Description of Business (Details)	9 Months Ended
	Sep. 30, 2011 State Property
Description of Business (Textuals) [Abstract]
Number of real estate properties	1,361
Number of states	46
Number of Canadian provinces	2
Senior Housing Communities [Member]
Description of Business (Textuals) [Abstract]
Number of real estate properties	673
Number of independent third party managed properties	199
Skilled Nursing Facilities [Member]
Description of Business (Textuals) [Abstract]
Number of real estate properties	398
Hospitals [Member]
Description of Business (Textuals) [Abstract]
Number of real estate properties	47
Medical Office Buildings [Member]
Description of Business (Textuals) [Abstract]
Number of real estate properties	243
Triple Net Leases [Member]
Description of Business (Textuals) [Abstract]
Number of properties leased	927

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Investments in Unconsolidated Entities

9 Months Ended

Sep. 30, 2011

Investments In Unconsolidated Entities [Abstract]

INVESTMENTS IN UNCONSOLIDATED ENTITIES

NOTE 6 — INVESTMENTS IN UNCONSOLIDATED ENTITIES

We report investments in unconsolidated entities, which we acquired in connection with our Lillibridge and NHP acquisitions, over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. We serve as the managing member of each unconsolidated entity and provide various services in exchange for fees and reimbursements. Our joint venture partners have significant participating rights, and, therefore, we are not required to consolidate these entities. Additionally, these entities are viable entities controlled by equity holders with sufficient capital and, therefore, are not considered variable interest entities. At September 30, 2011 and December 31, 2010, we owned interests (ranging between 5% and 25%) in 92 properties and interests (ranging between 5% and 20%) in 58 properties, respectively, that were accounted for under the equity method. Our net investment in these properties as of September 30, 2011 and December 31, 2010 was $119.3 million and $15.3 million, respectively. For the three months ended September 30, 2011 and 2010, we recorded income from unconsolidated entities of $0.2 million and a loss from unconsolidated entities of $0.4 million, respectively. For the nine months ended September 30, 2011 and 2010, we recorded a loss from unconsolidated entities of $0.1 million and $0.4 million, respectively.

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Income Taxes

9 Months Ended

Sep. 30, 2011

Income Taxes [Abstract]

INCOME TAXES

NOTE 11 — INCOME TAXES

We have elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”), commencing with the year ended December 31, 1999. We have also elected for certain of our subsidiaries to be treated as taxable REIT subsidiaries (“TRS” or “TRS entities”), which are subject to federal and state income taxes. Although the TRS entities were not liable for any cash federal income taxes for the nine months ended September 30, 2011, their federal income tax liabilities may increase in future periods as we exhaust net operating loss carryforwards and as our senior living operations and MOB operations reportable segments grow. Such increases could be significant.

Our consolidated provision for income taxes for the three months ended September 30, 2011 and 2010 was a benefit of $13.9 million and an expense of $1.7 million, respectively. These amounts were adjusted by income tax expense of $0 million and $0.6 million, respectively, related to the noncontrolling interest share of net income. Our consolidated provision for income taxes for the nine months ended September 30, 2011 and 2010 was a benefit of $23.3 million and an expense of $2.4 million, respectively. These amounts were adjusted by income tax expense of $0 million and $1.6 million, respectively, related to the noncontrolling interest share of net income. The benefit for the three and nine months ended September 30, 2011 primarily relates to the reversal of certain income tax contingency reserves, including interest, and the deferred tax liabilities established for the Atria Senior Living acquisition. The statute of limitations with respect to our 2007 U.S. federal income tax returns expired in September 2011. We did not recognize any income tax expense as a result of the litigation proceeds that we received in the third quarter of 2011, as no income taxes are payable on these proceeds.

Realization of a deferred tax benefit related to net operating losses is dependent in part upon generating sufficient taxable income in future periods. Our net operating loss carryforwards begin to expire in 2024 with respect to our TRS entities and in 2020 with respect to our other entities.

Each TRS is a tax paying component for purposes of classifying deferred tax assets and liabilities. Net deferred tax liabilities with respect to our TRS entities totaled $274.9 million and $241.3 million at September 30, 2011 and December 31, 2010, respectively, and related primarily to differences between the financial reporting and tax bases of fixed and intangible assets and to net operating losses. This amount includes the initial net deferred tax liability related to the Atria Senior Living acquisition of $43.9 million and adjustments for activity for the period from May 12, 2011 through September 30, 2011.

Generally, we are subject to audit under the statute of limitations by the Internal Revenue Service for the year ended December 31, 2008 and subsequent years and are subject to audit by state taxing authorities for the year ended December 31, 2007 and subsequent years. We are also subject to audit by the Canada Revenue Agency and provincial authorities generally for periods subsequent to 2004 related to entities acquired or formed in connection with our Sunrise REIT acquisition.

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Intangibles

9 Months Ended

Sep. 30, 2011

Intangibles [Abstract]

INTANGIBLES

NOTE 7 — INTANGIBLES

The following is a summary of our intangibles as of September 30, 2011 and December 31, 2010:

	September 30,			December 31,
	2011			2010
	(Dollars in thousands)
Intangible assets:
Above market lease intangibles	$	203,460		$	13,232
In-place and other lease intangibles		618,153			133,582
Other intangibles		16,453			13,649
Accumulated amortization		(152,486	)		(100,808	)
Goodwill		288,196			19,901
Net intangible assets	$	973,776		$	79,556
Remaining weighted average amortization period of lease-related intangible assets in years		19.6			18.5
Intangible liabilities:
Below market lease intangibles	$	486,228		$	22,398
Other lease intangibles		157,971			—
Accumulated amortization		(26,425	)		(12,495	)
Net intangible liabilities	$	617,774		$	9,903
Remaining weighted average amortization period of lease-related intangible liabilities in years		18.5			6.9

Above market lease intangibles and in-place and other lease intangibles are included in acquired lease intangibles within real estate investments on our Consolidated Balance Sheets. Other intangibles (including non-compete agreements and trade names/trademarks) and goodwill are included in other assets on our Consolidated Balance Sheets. Below market lease and other lease intangibles are included in accounts payable and other liabilities on our Consolidated Balance Sheets. For the three months ended September 30, 2011 and 2010, our net amortization expense related to these intangibles was $23.9 million and $2.3 million, respectively. For the nine months ended September 30, 2011 and 2010, our net amortization expense related to these intangibles was $40.0 million and $5.7 million, respectively. The estimated net amortization expense related to these intangibles for each of the next five years is as follows: 2012 — $76.1 million; 2013 — $18.4 million; 2014 — $15.0 million; 2015 — $8.9 million; and 2016 — $7.0 million.

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Earnings Per Common Share (Tables)

9 Months Ended

Sep. 30, 2011

Earnings Per Common Share [Abstract]

Computation of basic and diluted earnings per common share

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Numerator for basic and diluted earnings per share:
Income from continuing operations attributable to common stockholders	$	102,885	$	57,356	$	171,545	$	161,445
Discontinued operations		—		542		—		7,139
Net income attributable to common stockholders	$	102,885	$	57,898	$	171,545	$	168,584
Denominator:
Denominator for basic earnings per share — weighted average shares		287,365		156,631		208,470		156,566
Effect of dilutive securities:
Stock options		412		451		458		375
Restricted stock awards		38		95		57		62
OP units		1,868		—		630		—
Convertible notes		1,111		764		1,235		450
Denominator for diluted earnings per share — adjusted weighted average shares		290,794		157,941		210,850		157,453
Basic earnings per share:
Income from continuing operations attributable to common stockholders	$	0.36	$	0.37	$	0.82	$	1.03
Discontinued operations		—		0.00		—		0.05
Net income attributable to common stockholders	$	0.36	$	0.37	$	0.82	$	1.08
Diluted earnings per share:
Income from continuing operations attributable to common stockholders	$	0.35	$	0.37	$	0.81	$	1.02
Discontinued operations		—		0.00		—		0.05
Net income attributable to common stockholders	$	0.35	$	0.37	$	0.81	$	1.07

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Loans Receivable

9 Months Ended

Sep. 30, 2011

Loans Receivable [Abstract]

LOANS RECEIVABLE

NOTE 5 — LOANS RECEIVABLE

As of September 30, 2011 and December 31, 2010, we had $367.6 million and $149.3 million, respectively, of net loans receivable relating to seniors housing and healthcare companies or properties.

In November 2011, we received proceeds of $3.0 million in final repayment of two secured loans receivable.

In October 2011, we received proceeds of $6.4 million in final repayment of a first mortgage loan.

In August 2011, we received proceeds of $5.5 million in final repayment of a secured mortgage loan.

In connection with the NHP acquisition, on July 1, 2011, we acquired (i) mortgage loans receivable with an initial aggregate fair value of approximately $270 million that are secured by 53 seniors housing and healthcare properties and (ii) other loans receivable with an initial aggregate fair value of approximately $60 million that are unsecured.

In June 2011, we made a first mortgage loan in the aggregate principal amount of $12.9 million, bearing interest at a fixed rate of 9.0% per annum and maturing in 2016.

In May 2011, we made a senior unsecured term loan to NHP in the aggregate principal amount of $600.0 million, bearing interest at a fixed rate of 5.0% per annum and maturing in 2021. As of our acquisition date of NHP, this investment and related interest were eliminated in consolidation.

In April 2011, we received proceeds of $112.4 million in final repayment of a first mortgage loan and recognized a gain of $3.3 million (included in income from loans and investments on our Consolidated Statements of Income) in connection with this repayment in the second quarter of 2011.

In March 2011, we received proceeds of $19.9 million in final repayment of a first mortgage loan and recognized a gain of $0.8 million (included in income from loans and investments on our Consolidated Statements of Income) in connection with this repayment in the first quarter of 2011.

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Stockholders' Equity (Details) (USD $) In Thousands	Sep. 30, 2011	Dec. 31, 2010
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Foreign currency translation	$ 18,776	$ 23,010
Unrealized gain on marketable debt securities	1,830	4,794
Other	(1,369)	(936)
Total accumulated other comprehensive income	$ 19,237	$ 26,868

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Consolidated Statements of Equity (USD $) In Thousands	Total	Total Ventas Stockholders' Equity	Common Stock Par Value	Capital in Excess of Par Value	Accumulated Other Comprehensive Income	Retained Earnings (Deficit)	Treasury Stock	Noncontrolling Interest
Beginning Balance at Dec. 31, 2009	$ 2,484,060	$ 2,465,511	$ 39,160	$ 2,573,039	$ 19,669	$ (165,710)	$ (647)	$ 18,549
Comprehensive Income:
Net income	249,729	246,167				246,167		3,562
Foreign currency translation	6,951	6,951			6,951
Change in unrealized gain on marketable debt securities	354	354			354
Other	(106)	(106)			(106)
Comprehensive income	256,928	253,366						3,562
Net change in noncontrolling interest	(37,135)	(18,503)		(18,503)				(18,632)
Dividends to common stockholders - $2.14 and $1.725 per share in 2010 and 2011, respectively	(336,085)	(336,085)				(336,085)
Issuance of common stock for stock plans	24,644	24,644	197	21,076			3,371
Grant of restricted stock, net of forfeitures	(2,207)	(2,207)	34	1,231			(3,472)
Ending Balance at Dec. 31, 2010	2,390,205	2,386,726	39,391	2,576,843	26,868	(255,628)	(748)	3,479
Comprehensive Income:
Net income	170,764	171,545				171,545		(781)
Foreign currency translation	(4,234)	(4,234)			(4,234)
Change in unrealized gain on marketable debt securities	(2,964)	(2,964)			(2,964)
Other	(433)	(433)			(433)
Comprehensive income	163,133	163,914						(781)
Acquisition-related activity	6,821,632	6,737,930	31,202	6,711,054			(4,326)	83,702
Net change in noncontrolling interest	(5,063)	(3,170)		(3,170)				(1,893)
Dividends to common stockholders - $2.14 and $1.725 per share in 2010 and 2011, respectively	(354,932)	(354,932)				(354,932)
Issuance of common stock	299,701	299,701	1,390	298,311
Issuance of common stock for stock plans	14,718	14,718	9	14,402			307
Adjust redeemable OP unitholder interests to current fair value	1,582	1,582		1,582
Grant of restricted stock, net of forfeitures	(707)	(707)	33	(3,527)			2,787
Ending Balance at Sep. 30, 2011	$ 9,330,269	$ 9,245,762	$ 72,025	$ 9,595,495	$ 19,237	$ (439,015)	$ (1,980)	$ 84,507

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Description of Business

9 Months Ended

Sep. 30, 2011

Description of Business [Abstract]

DESCRIPTION OF BUSINESS

NOTE 1 — DESCRIPTION OF BUSINESS

Ventas, Inc. (together with its subsidiaries, unless otherwise indicated or except where the context otherwise requires, “we,” “us” or “our”) is a real estate investment trust (“REIT”) with a geographically diverse portfolio of seniors housing and healthcare properties in the United States and Canada. As of September 30, 2011, our portfolio consisted of 1,361 properties: 673 seniors housing communities, 398 skilled nursing facilities, 47 hospitals and 243 medical office buildings (“MOBs”) and other properties in 46 states, the District of Columbia and two Canadian provinces. We are a constituent member of the S&P 500^® index, a leading indicator of the large cap U.S. equities market, with our headquarters located in Chicago, Illinois.

Our primary business consists of acquiring and owning seniors housing and healthcare properties and leasing those properties to unaffiliated tenants or operating those properties through independent third party managers. Through our Lillibridge Healthcare Services, Inc. (“Lillibridge”) subsidiary and our ownership interest in PMB Real Estate Services LLC (“PMBRES”), which we acquired in July 2011 in connection with our acquisition of Nationwide Health Properties, Inc. (“NHP”), we also provide management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make real estate loans and other investments relating to seniors housing and healthcare companies or properties.

As of September 30, 2011, we leased 927 of our properties (excluding MOBs) to healthcare operating companies under “triple-net” or “absolute-net” leases that obligate the tenants to pay all property-related expenses (including maintenance, utilities, repairs, taxes, insurance and capital expenditures), and we engaged independent third parties, such as Sunrise Senior Living, Inc. (together with its subsidiaries, “Sunrise”) and Atria Senior Living, Inc. (“Atria”), to manage 199 of our seniors housing communities pursuant to long-term management agreements.

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Acquisitions of Real Estate Property (Details Textuals) (USD $)	3 Months Ended		9 Months Ended			1 Months Ended		1 Months Ended		1 Months Ended		1 Months Ended		1 Months Ended		9 Months Ended		3 Months Ended	9 Months Ended					1 Months Ended	3 Months Ended	9 Months Ended		1 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010	Dec. 31, 2010	Jun. 30, 2010 96 MOBs [Member] Lillibridge Acquisition [Member] Building	Jul. 02, 2010 96 MOBs [Member] Lillibridge Acquisition [Member]	Jun. 30, 2010 38 MOBs [Member] Building	Jul. 02, 2010 38 MOBs [Member] Lillibridge Acquisition [Member]	Jun. 30, 2010 24 MOBs [Member] Building	Jul. 02, 2010 24 MOBs [Member] Lillibridge Acquisition [Member]	Jun. 30, 2010 34 MOBs [Member] Building	Jul. 02, 2010 34 MOBs [Member] Lillibridge Acquisition [Member]	Dec. 31, 2010 5 MOBs [Member] Building	Oct. 31, 2011 2 MOBs [Member] Other Acquisition [Member] Property	Sep. 30, 2011 Nationwide Health Properties [Member] Triple-Net Leased Properties [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Operating Assets [Member]	Sep. 30, 2011 Atria Senior Living Acquisition [Member]	Sep. 30, 2011 Atria Senior Living Acquisition [Member]	May 12, 2011 Atria Senior Living Acquisition [Member] Property	Jul. 02, 2010 Lillibridge Acquisition [Member] Party	Dec. 31, 2010 Minimum [Member] Sunrise Acquisition [Member]	Dec. 31, 2010 Maximum [Member] Sunrise Acquisition [Member]	Dec. 31, 2010 Sunrise Acquisition [Member] Property	Sep. 30, 2011 Nationwide Health Properties [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Property HousingCommunity	Jul. 02, 2011 Nationwide Health Properties [Member]	Oct. 31, 2011 Other Acquisition [Member] Property	Aug. 31, 2011 Other Acquisition [Member] Property	Sep. 30, 2011 Other Acquisition [Member] Property	Aug. 02, 2011 Seniors Housing Asset [Member]	Oct. 31, 2011 MOBs and Senior housing communities [Member]
Acquisitions of Real Estate Property (Textuals) [Abstract]
Purchase price of acquisition of assets							$ 381,000,000																	$ 186,000,000
Purchase price of seniors housing asset																		3,594,802,000	3,594,802,000						8,318,678,000	8,318,678,000					3,800,000	150,300,000
Value of common stock shares issued related to acquisition																				1,380,000,000							5,400,000,000
Business acquisition equity interests issued or issuable number of shares issued																			24,960,000
Business acquisition equity interest issued or issuable per share																				$ 55.33							$ 53.74
Total number of private pay seniors housing communities through acquisition																				117
Revenues From Properties Acquired																		157,100,000	242,800,000						134,800,000	134,800,000
NOI from properties acquired																		47,500,000	73,700,000						122,900,000	122,900,000
Assumption of mortgage debt																					79,500,000			144,000,000								37,700,000
Acquired Ownership Interest									100.00%		20.00%		5.00%
Acquired ownership interest in Lillibridge's services and development business																					100.00%
Number of institutional third parties holding majority interests of joint ventures																					2
Repaid mortgage debt involved in acquisition																					132,700,000
Acquired ownership interest in seventy nine seniors housing communities																								100.00%
Number of acquisitions involved in Sunrise's noncontrolling interests																								58
Number of seniors housing communities involved with Sunrise																								79				2	1
Noncontrolling interests acquired represent Seventy Nine Seniors Housing Communities																						15.00%	25.00%
Purchase price of 5 MOBs														36,600,000
Acquisition related costs	69,350,000	5,142,000	131,606,000	11,668,000														1,500,000	48,200,000						42,500,000	54,800,000
Total acquisition related cost																		52,500,000	52,500,000						54,800,000	54,800,000
Number of Medical office buildings purchased															2
Number of properties acquired						96		38		24		34		5												643
Contingent consideration liability, Fair Value	56,218,000		56,218,000		0													44,200,000	44,200,000	44,200,000
Conversion ratio of acquired entity common stock to parent common stock																											0.7866
Goodwill																		79,200,000	79,200,000						189,600,000	189,600,000
Deferred tax liability																		43,889,000	43,889,000
Amount paid for closing of revolving credit facility																										105,000,000
Allocation of goodwill																$ 129,400,000	$ 60,200,000
Number of shares reduced for working capital adjustment																			83,441
Number of acquired seniors housing operating asset managed by other																														1

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Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2011

Stockholders' Equity [Abstract]

Accumulated Other Comprehensive Income

	September 30,			December 31,
	2011			2010
	(In thousands)
Foreign currency translation	$	18,776		$	23,010
Unrealized gain on marketable debt securities		1,830			4,794
Other		(1,369	)		(936	)
Total accumulated other comprehensive income	$	19,237		$	26,868

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Segment Information (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010	Dec. 31, 2010
Assets
Total assets	$ 17,205,770		$ 17,205,770		$ 5,758,021
Percentage of total assets	100.00%		100.00%		100.00%
Capital expenditures
Total capital expenditures	112,878	222,407	396,578	252,400
Triple-Net Leased Properties [Member]
Assets
Total assets	8,652,706		8,652,706		2,474,612
Percentage of total assets	50.30%		50.30%		43.00%
Capital expenditures
Total capital expenditures	68,604	211	69,831	12,303
Senior Living Operations [Member]
Assets
Total assets	5,807,192		5,807,192		2,297,041
Percentage of total assets	33.70%		33.70%		39.90%
Capital expenditures
Total capital expenditures	20,842	3,889	296,446	6,782
MOB Operations [Member]
Assets
Total assets	2,367,480		2,367,480		748,945
Percentage of total assets	13.80%		13.80%		13.00%
Capital expenditures
Total capital expenditures	23,432	218,307	30,301	233,315
All Other [Member]
Assets
Total assets	$ 378,392		$ 378,392		$ 237,423
Percentage of total assets	2.20%		2.20%		4.10%

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Segment Information (Details 3) (USD $) In Thousands	Sep. 30, 2011	Dec. 31, 2010
Net real estate property:
United States	$ 15,598,457	$ 4,857,510
Canada	397,585	422,009
Net real estate property	$ 15,996,042	$ 5,279,519

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Income Taxes (Details) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010	Dec. 31, 2010
Income Taxes (Textuals) [Abstract]
Income tax benefit (expense)	$ 13,904,000	$ (1,657,000)	$ 23,310,000	$ (2,352,000)
Income tax expense related to the noncontrolling interest share of net income	0	600,000	0	1,600,000
Deferred income taxes	274,852,000		274,852,000		241,333,000
Deferred tax liabilities related to Atria Senior Living transaction			$ 43,889,000

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Condensed Consolidating Information (Details 2) (USD $) In Thousands	9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011 Parent Company [Member]	Sep. 30, 2010 Parent Company [Member]	Sep. 30, 2011 Wholly Owned Subsidiary Guarantors [Member]	Sep. 30, 2010 Wholly Owned Subsidiary Guarantors [Member]	Sep. 30, 2011 Ventas Issuers [Member]	Sep. 30, 2010 Ventas Issuers [Member]	Sep. 30, 2011 Non-Guarantor Subsidiaries [Member]	Sep. 30, 2010 Non-Guarantor Subsidiaries [Member]	Sep. 30, 2011 Consolidated Eliminations [Member]	Dec. 31, 2010 Consolidated Eliminations [Member]
Condensed Consolidating Statement of Cash Flows
Net cash (used in) provided by operating activities	$ 443,901	$ 346,119	$ (3,510)	$ (864)	$ 107,282	$ 118,174	$ 180,935	$ 179,105	$ 159,194	$ 49,704
Net cash used in investing activities	(842,924)	(268,476)	(431,727)		89,296	(57,096)	(500,879)	(207,509)	386	(3,871)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities	434,000	233,004				102,004	434,000	131,000
Proceeds from debt	957,753	201,237					689,374	200,000	268,379	1,237
Repayment of debt	(895,043)	(331,378)			(328,691)	(144,739)	(206,500)	(178,139)	(359,852)	(8,500)
Net change in intercompany debt			981,494	48,748	84,585	(59,452)	(1,208,212)	10,704	142,133
Payment of deferred financing costs	(1,898)	(1,872)				(46)	(1,519)	(1,826)	(379)
Issuance of common stock, net	299,926		299,926
Cash distribution (to) from affiliates			(491,099)	199,706	56,767	50,104	612,898	(216,290)	(178,566)	(33,520)
Cash distribution to common stockholders	(354,932)	(251,921)	(354,932)	(251,921)
Cash distribution to redeemable OP unitholders	4,038								4,038
Contributions from noncontrolling interest	2	818							2	818
Distributions to noncontrolling interest	(1,997)	(6,633)							(1,997)	(6,633)
Other	1,017	5,426	1,017	5,426
Net cash provided by (used in) financing activities	434,790	(151,319)	436,406	1,959	(187,339)	(52,129)	320,041	(54,551)	(134,318)	(46,598)
Net increase (decrease) in cash and cash equivalents	35,767	(73,676)	1,169	1,095	9,239	8,949	97	(82,955)	25,262	(765)
Effect of foreign currency translation on cash and cash equivalents	(97)	69					(97)	69
Cash and cash equivalents at beginning of period	21,812	107,397	1,083		15,659	7,864	0	82,886	5,070	16,647	0	0
Cash and cash equivalents at end of period	$ 57,482	$ 33,790	$ 2,252	$ 1,095	$ 24,898	$ 16,813	$ 0		$ 30,332	$ 15,882	$ 0	$ 0

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Accounting Policies

9 Months Ended

Sep. 30, 2011

Accounting Policies [Abstract]

ACCOUNTING POLICIES

NOTE 2 — ACCOUNTING POLICIES

The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information set forth in the Accounting Standards Codification (“ASC”), as published by the Financial Accounting Standards Board (“FASB”), and with the Securities and Exchange Commission (“SEC”) instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. Operating results for the three and nine months ended September 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011. The accompanying Consolidated Financial Statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2010, filed with the SEC on February 18, 2011. Certain prior period amounts have been reclassified to conform to the current period presentation.

Principles of Consolidation

The accompanying Consolidated Financial Statements include our accounts and the accounts of our wholly owned subsidiaries and the joint venture entities over which we exercise control. All intercompany transactions and balances have been eliminated in consolidation, and net earnings are reduced by the portion of net earnings attributable to noncontrolling interests.

We apply FASB guidance for arrangements with variable interest entities (“VIEs”), which requires us to identify entities for which control is achieved through means other than voting rights and to determine which business enterprise is the primary beneficiary of the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. We consolidate investments in VIEs when we are determined to be the primary beneficiary of the VIE. We may change our original assessment of a VIE due to events such as the modification of contractual arrangements that affects the characteristics or adequacy of the entity’s equity investments at risk and the disposal of all or a portion of an interest held by the primary beneficiary. We identify the primary beneficiary of a VIE as the enterprise that has both of the following characteristics: (i) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance; and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the entity. We perform this analysis on an ongoing basis. At September 30, 2011, we did not have any unconsolidated VIEs.

We also apply FASB guidance related to investments in joint ventures based on the type of rights held by the limited partner(s) which may preclude consolidation by the sole general partner in certain circumstances in which the general partner would otherwise consolidate the joint venture. We assess limited partners’ rights and their impact on the presumption of control of the limited partnership by the sole general partner when an investor becomes the sole general partner and we reassess if (i) there is a change to the terms or in the exercisability of the rights of the limited partners, (ii) the sole general partner increases or decreases its ownership of limited partnership interests, or (iii) there is an increase or decrease in the number of outstanding limited partnership interests. We also apply this guidance to managing member interests in limited liability companies.

Revenue Recognition

Triple-Net Leased Properties and MOB Operations

Certain of our triple-net leases, including the majority of our leases with Brookdale Senior Living Inc. (together with its subsidiaries, “Brookdale Senior Living”), and most of our MOB leases provide for periodic and determinable increases in base rent. We recognize base rental revenues under these leases on a straight-line basis over the applicable lease term when collectibility is reasonably assured. Recognizing rental income on a straight-line basis results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in other assets on our Consolidated Balance Sheets. At September 30, 2011 and December 31, 2010, this net cumulative excess totaled $95.5 million and $86.3 million, respectively.

Our master lease agreements with Kindred Healthcare, Inc. (together with its subsidiaries, “Kindred”) (the “Kindred Master Leases”) and certain of our other leases provide for periodic increases in base rent only if certain revenue parameters or other substantive contingencies are met. We recognize the increased rental revenue under these leases as the related parameters or contingencies are met, rather than on a straight-line basis over the applicable lease term.

Senior Living Operations

We recognize resident fees and services, other than move-in fees, monthly as services are provided. We recognize move-in fees on a straight-line basis over the average resident stay. Our lease agreements with residents generally have a term of twelve to eighteen months and are cancelable by the resident upon 30 days’ notice.

Other

We recognize interest income from loans, including discounts and premiums, using the effective interest method when collectibility is reasonably assured. The effective interest method is applied on a loan-by-loan basis, and discounts and premiums are recognized as yield adjustments over the related loan term. We recognize interest income on an impaired loan to the extent our estimate of the fair value of the collateral is sufficient to support the balance of the loan, other receivables and all related accrued interest. When the balance of the loans, other receivables and all related accrued interest is equal to our estimate of the fair value of the collateral, we recognize interest income on a cash basis. We provide a reserve against an impaired loan to the extent our total investment in the loan exceeds our estimate of the fair value of the loan collateral.

We recognize income from rent, lease termination fees, management advisory services and all other income when all of the following criteria are met in accordance with SEC Staff Accounting Bulletin 104: (i) the applicable agreement has been fully executed and delivered; (ii) services have been rendered; (iii) the amount is fixed or determinable; and (iv) collectibility is reasonably assured.

Allowances

We assess the collectibility of our rent receivables, including straight-line rent receivables, in accordance with the applicable accounting standards and our reserve policy, and we defer recognition of revenue if collectibility is not reasonably assured. Our assessment of the collectibility of rent receivables (excluding straight-line receivables) is based on several factors, including, among other things, payment history, the financial strength of the tenant and any guarantors, the value of the underlying collateral, if any, and current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to recover the full value of the receivable, we provide a reserve against the portion of the receivable that we estimate may not be recovered. Our assessment of the collectibility of straight-line receivables is based on several factors, including, among other things, the financial strength of the tenant and any guarantors, the historical operations and operating trends of the property, the historical payment pattern of the tenant, and the type of property. If our evaluation of these factors indicates it is probable that we will be unable to receive the rent payments due in the future, we defer recognition of the straight-line rental income and, in certain circumstances, provide a reserve against the previously recognized straight-line rent receivable asset for a portion, up to its full value, that we estimate may not be recovered. If we change our assumptions or estimates regarding the collectibility of future rent payments required by a lease, we may adjust our reserve to increase or reduce the rental revenue recognized and/or to increase or reduce the reserve against the existing straight-line rent receivable.

Business Combinations

We account for acquisitions using the acquisition method and allocate the cost of the properties acquired among tangible and recognized intangible assets and liabilities based upon their estimated fair values as of the acquisition date. Recognized intangibles primarily include the value of in-place leases, acquired lease contracts, tenant and customer relationships, trade names/trademarks and goodwill. We do not amortize goodwill, which is included in other assets on our Consolidated Balance Sheets and represents the excess of the purchase price paid over the fair value of the net assets of the acquired business.

We estimate the fair value of buildings acquired on an as-if-vacant basis and depreciate the building value over the estimated remaining life of the building. We determine the allocated value of other fixed assets, such as site improvements and furniture, fixtures and equipment, based upon the replacement cost and depreciate such value over the assets’ estimated remaining useful lives. We determine the value of land by considering the sales prices of similar properties in recent transactions or based on (i) internal analyses of recently acquired and existing comparable properties within our portfolio or (ii) real estate tax assessed values in relation to the total value of the asset. The fair value of acquired lease intangibles, if any, reflects (i) the estimated value of any above and/or below market leases, determined by discounting the difference between the estimated market rent and the in-place lease rent, the resulting intangible asset or liability of which is amortized to revenue over the remaining life of the associated lease plus any bargain renewal periods, and (ii) the estimated value of in-place leases related to the cost to obtain tenants, including tenant allowances, tenant improvements and leasing commissions, and an estimated value of the absorption period to reflect the value of the rent and recovery costs foregone during a reasonable lease-up period as if the acquired space was vacant, which is amortized to amortization expense over the remaining life of the associated lease. We estimate the fair value of tenant or other customer relationships acquired, if any, by considering the nature and extent of existing business relationships with the tenant or customer, growth prospects for developing new business with the tenant or customer, the tenant’s credit quality, expectations of lease renewals with the tenant, and the potential for significant, additional future leasing arrangements with the tenant and amortize that value over the expected life of the associated arrangements or leases, including the remaining terms of the related leases and any expected renewal periods. We estimate the fair value of trade names/trademarks using a royalty rate methodology and amortize that value over the estimated useful life of the trade name/trademark.

In connection with a business combination, we may assume the rights and obligations under certain lease agreements pursuant to which we become the lessee of a given property. We assume the lease classification previously determined by the prior lessee absent a modification in the assumed lease agreement. In connection with our recent acquisitions, all capital leases acquired or assumed contain bargain purchase options that we intend to exercise. Therefore, we recognized an asset based on the acquisition date fair value of the underlying property and a liability based on the acquisition date fair value of the capital lease. We assess capital leases that contain bargain purchase options are depreciated over the asset’s useful life. We assess assumed operating leases, including ground leases, to determine if the lease terms are favorable or unfavorable given current market conditions on the acquisition date. To the extent the lease arrangement is favorable or unfavorable relative to market conditions on the acquisition date, we recognize an intangible asset or liability at fair value. The recognized asset or liability (excluding purchase option intangibles) for these leases is amortized to interest or rental expense over the applicable lease term and is included in our Consolidated Statements of Income. All lease-related intangible assets are included within acquired lease intangibles and all lease-related intangible liabilities are included within accounts payable and other liabilities, on our Consolidated Balance Sheets.

For loans receivable acquired in connection with a business combination, we determine fair value by discounting the estimated future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The estimated future cash flows reflect our judgment regarding the uncertainty of those cash flows and, therefore, we do not establish a valuation allowance at the acquisition date. The difference between the acquisition date fair value and the total expected cash flows is recognized as interest income using an effective interest method over the life of the applicable loan. Subsequent to the acquisition date, we evaluate changes regarding the uncertainty of future cash flows and the need for a valuation allowance.

We estimate the fair value of investments in unconsolidated entities and noncontrolling interests assumed using assumptions that are consistent with those used in valuing all of the underlying assets and liabilities.

We calculate the fair value of long-term debt by discounting the remaining contractual cash flows on each instrument at the current market rate for those borrowings, which we approximate based on the rate we would expect to incur to replace the instrument on the date of acquisition, and recognize any fair value adjustments related to long-term debt as effective yield adjustments over the remaining term of the instrument.

We record a liability for contingent consideration at fair value as of the acquisition date (which is included in accounts payable and other liabilities on our Consolidated Balance Sheets) and reassess the fair value at the end of each reporting period, with any changes being recognized in earnings. Increases or decreases in the fair value of contingent consideration can result from changes in discount periods, discount rates and probabilities that contingencies will be met.

Loans Receivable

Loans receivable, other than those acquired in connection with a business combination, are recorded on our Consolidated Balance Sheets at the unpaid principal balance, net of any deferred origination fees, purchase discounts or premiums and valuation allowances. Unsecured loans receivable are included in other assets on our Consolidated Balance Sheets. We amortize net deferred origination fees, which are comprised of loan fees collected from the borrower net of certain direct costs, and purchase discounts or premiums over the contractual life of the loan using the effective interest method and recognize any unamortized balances in income immediately if the loan is repaid before its contractual maturity.

We regularly evaluate the collectibility of loans receivable based on several factors, including without limitation (i) corporate and facility-level financial and operational reports, (ii) compliance with any financial covenants set forth in the applicable loan agreement, (iii) the financial strength of the borrower and any guarantor, (iv) the payment history of the borrower, and (v) current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to collect all amounts due according to the terms of the applicable loan agreement, we provide a reserve against the portion of the receivable that we estimate may not be collected.

Leases

We include assets under capital leases within net real estate assets, and we include capital lease obligations within senior notes payable and other debt, on our Consolidated Balance Sheets. Lease payments under capital lease arrangements are segregated between interest expense and a reduction to the outstanding principal balance, using the effective interest method. We account for payments made pursuant to operating leases in our Consolidated Statements of Income based on actual rent paid, plus or minus a straight-line rent adjustment for minimum lease escalators.

Derivative Instruments

We recognize all derivative instruments in either other assets or accounts payable and accrued liabilities on our Consolidated Balance Sheets at fair value as of the reporting date. We recognize changes in the fair value of derivative instruments in other expenses on our Consolidated Statements of Income or accumulated other comprehensive income on our Consolidated Balance Sheets, depending on the intended use of the derivative and our designation of the instrument.

We do not use our derivative financial instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, for trading or speculative purposes. Our interest rate caps were designated as having a hedging relationship with their underlying securities and therefore meet the criteria for hedge accounting under GAAP. Our interest rate caps are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in accumulated other comprehensive income on our Consolidated Balance Sheets. Our interest rate swaps and foreign currency forward contracts were not designated as having a hedging relationship with their underlying securities and therefore do not meet the criteria for hedge accounting under GAAP. Our interest rate swaps and foreign currency forward contracts are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in current earnings (in other expenses) on our Consolidated Statements of Income.

Redeemable Limited Partnership Unitholder Interests

As part of the NHP acquisition, we acquired a majority interest in NHP/PMB L.P. (“NHP/PMB”), a limited partnership that was formed in 2008 to acquire properties from entities affiliated with Pacific Medical Buildings LLC. We consolidate NHP/PMB, as our wholly owned subsidiary is the general partner and exercises control. As of September 30, 2011, third party investors owned 2,375,027 Class A limited partnership units in NHP/PMB (“OP Units”), which represented 29.1% of the total units then outstanding, and we owned 5,795,210 Class B limited partnership units in NHP/PMB, representing the remaining 70.9%. At any time following the first anniversary of the date of issuance, the OP Units may be redeemed, at the election of the holder, for cash or, at our option, 0.7866 shares of our common stock per unit, subject to adjustment in certain circumstances. We are party to a registration rights agreement with the holders of the OP Units that requires us, subject to the terms and conditions set forth therein, to file and maintain a registration statement relating to the issuance of shares of our common stock upon redemption of OP Units. As registration rights are outside of our control, the redeemable OP unitholder interests are classified outside of permanent equity on our Consolidated Balance Sheets. We applied the provisions of ASC Topic 480, Distinguishing Liabilities from Equity, to reflect the redeemable OP unitholder interests at the greater of cost or fair value. As of September 30, 2011, the fair value of the redeemable OP unitholder interests was $92.8 million. The change in fair value from the acquisition date to September 30, 2011 has been recorded through capital in excess of par value. Our diluted earnings per share (“EPS”) includes the effect of any potential shares outstanding from these OP Units.

Noncontrolling Interests

For entities that we control (and thus consolidate) but do not own 100% of the equity, the portion of the equity we do not own is presented as noncontrolling interests and classified as a component of consolidated equity. Each such entity’s contribution to our income and earnings per share is based on income attributable to the entity’s parent and is included in net income attributable to common stockholders on our Consolidated Statements of Income. As our ownership of a controlled subsidiary increases or decreases, any difference between the aggregate consideration paid to acquire the noncontrolling interests and our noncontrolling interest balance is recorded as a component of equity in additional paid-in capital, so long as we maintain a controlling ownership interest.

As of September 30, 2011 and December 31, 2010, we had controlling interests in 29 properties and six properties, respectively, owned through joint ventures. The noncontrolling interest in these properties as of September 30, 2011 and December 31, 2010 was $84.5 million and $3.5 million, respectively. For the three months ended September 30, 2011 and 2010, we recorded a loss attributable to noncontrolling interests of $0.9 million and income attributable to noncontrolling interests of $1.0 million, respectively. For the nine months ended September 30, 2011 and 2010, we recorded a loss attributable to noncontrolling interests of $0.8 million and income attributable to noncontrolling interests of $2.4 million, respectively.

Fair Values of Financial Instruments

Fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, FASB guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels one and two of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within level three of the hierarchy).

Level one inputs utilize unadjusted quoted prices for identical assets or liabilities in active markets that the reporting entity has the ability to access. Level two inputs are inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets, as well as other inputs for the asset or liability, such as interest rates, foreign exchange rates and yield curves, that are observable at commonly quoted intervals. Level three inputs are unobservable inputs for the asset or liability, which are typically based on the reporting entity’s own assumptions, as there is little, if any, related market activity. If the determination of the fair value measurement is based on inputs from different levels of the hierarchy, the level within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

We use the following methods and assumptions in estimating fair value of financial instruments:

• Cash and cash equivalents: The carrying amount of unrestricted cash and cash equivalents reported on our Consolidated Balance Sheets approximates fair value due to the short maturity of these instruments.

• Loans receivable: We estimate the fair value of loans receivable by discounting future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The inputs used to measure the fair value of our loans receivable are level two and level three inputs. Additionally, we determine the valuation allowance for losses on loans receivable based on level three inputs.

• Marketable debt securities: We estimate the fair value of marketable debt securities using quoted prices for similar assets or liabilities in active markets that we have the ability to access. The inputs used to measure the fair value of our marketable debt securities are level two inputs.

• Derivative instruments: With the assistance of a third party, we estimate the fair value of our derivative instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, using level two inputs. We determine the fair value of interest rate caps using forward yield curves and other relevant information. We estimate the fair value of interest rate swaps using alternative financing rates derived from market-based financing rates, forward yield curves and discount rates. We determine the fair value of foreign currency forward contracts by estimating the future values of the two currency tranches using forward exchange rates that are based on traded forward points and calculating a present value of the net amount using a discount factor based on observable traded interest rates.

• Senior notes payable and other debt: We estimate the fair value of borrowings by discounting the future cash flows using current interest rates at which we could make similar borrowings. The inputs used to measure the fair value of our senior notes payable and other debt are level two inputs.

• Contingent consideration: We estimate the fair value of contingent consideration using probability assessments of expected future cash flows over the period in which the obligation is expected to be settled, and by applying a discount rate that appropriately captures a market participant’s view of the risk associated with the obligation. The inputs we use to determine the fair value of contingent consideration are considered level three inputs.

• Redeemable OP unitholder interests: We estimate the fair value of redeemable OP unitholder interests based on the closing price of our common stock, as the OP Units may be redeemed, at the election of the holder, for cash or, at our option, 0.7866 shares of our common stock, subject to adjustment in certain circumstances. The inputs used to measure the fair value of redeemable OP unitholder interests are level two inputs.

Recently Issued or Adopted Accounting Standards

In September 2011, the FASB issued Accounting Standards Update (“ASU”) 2011-08, Testing Goodwill for Impairment (“ASU 2011-08”), which permits companies to first assess qualitative factors to determine the likelihood that the fair value of a reporting unit is less than its carrying amount, before performing the current two-step analysis. If a company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the company must proceed with the two-step approach to evaluating impairment. The provisions of ASU 2011-08 will be effective for us beginning with the first quarter of 2012, but we do not expect ASU 2011-08 to have a significant impact on our Consolidated Financial Statements. Also, on January 1, 2011, we adopted ASU 2010-28, When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts (“ASU 2010-28”). ASU 2010-28 states that if a reporting unit has a carrying amount that is equal to or less than zero and there are qualitative factors that indicate it is more likely than not that a goodwill impairment exists, Step 2 of the goodwill impairment test must be performed. The adoption of ASU 2010-28 did not impact our Consolidated Financial Statements.

In June 2011, the FASB issued ASU 2011-05, Presentation of Comprehensive Income (“ASU 2011-05”), which amends current guidance found in ASC Topic 220, Comprehensive Income. ASU 2011-05 requires entities to present comprehensive income in either: (i) one continuous financial statement or (ii) two separate but consecutive statements that display net income and the components of other comprehensive income. Totals and individual components of both net income and other comprehensive income must be included in either presentation. The provisions of ASU 2011-05 will be effective for us beginning with the first quarter of 2012.

On January 1, 2011, we adopted ASU 2010-29, Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations (“ASU 2010-29”), affecting public entities who enter into business combinations that are material on an individual or aggregate basis. ASU 2010-29 specifies that a public entity presenting comparative financial statements should disclose revenues and earnings of the combined entity as though the business combination(s) that occurred during the year had occurred at the beginning of the prior annual reporting period when preparing the pro forma financial information for both the current and prior reporting periods. This guidance, which is effective for business combinations consummated in reporting periods beginning after December 15, 2010, also requires that pro forma disclosures be accompanied by a narrative description regarding the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination(s) included in reported pro forma revenues and earnings. We have presented supplementary pro forma information related to our acquisition of substantially all of the real estate assets and working capital of Atria Senior Living Group, Inc. (together with its affiliates, “Atria Senior Living”) in May 2011 and our acquisition of NHP in July 2011 in “Note 4—Acquisitions of Real Estate Property.”

In January 2010, the FASB issued ASU 2010-06, Improving Disclosures about Fair Value Measurements (“ASU 2010-06”), which expands required disclosures related to an entity’s fair value measurements. Certain provisions of ASU 2010-06 are effective for interim and annual reporting periods beginning after December 15, 2009, and we adopted those provisions as of January 1, 2010. The remaining provisions, which are effective for interim and annual reporting periods beginning after December 15, 2010, require additional disclosures related to purchases, sales, issuances and settlements in an entity’s reconciliation of recurring level three investments. We adopted those provisions of ASU 2010-06 as of January 1, 2011. The adoption of ASU 2010-06 did not impact our Consolidated Financial Statements.

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Investments in Unconsolidated Entities (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2011 Property State Year Province License LeaseRenewal	Sep. 30, 2010	Sep. 30, 2011 Segment Property Year State Province License LeaseRenewal	Sep. 30, 2010	Dec. 31, 2010 Year Property
Investments in Unconsolidated Entities (Textuals) [Abstract]
Number of properties accounted for under equity method	92		92		58
Net investments in unconsolidated entities	$ 119,322		$ 119,322		$ 15,332
Income (loss) from unconsolidated entities	$ 182	$ (392)	$ (71)	$ (392)
Minimum [Member]
Schedule of Equity Method Investments [Line Items]
Ownership interests in 92 properties accounted for under the equity method	5.00%		5.00%
Ownership interests in 58 properties accounted for under the equity method					5.00%
Maximum [Member]
Schedule of Equity Method Investments [Line Items]
Ownership interests in 92 properties accounted for under the equity method	25.00%		25.00%
Ownership interests in 58 properties accounted for under the equity method					20.00%

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Intangibles (Tables)

9 Months Ended

Sep. 30, 2011

Intangibles [Abstract]

Intangibles

	September 30,			December 31,
	2011			2010
	(Dollars in thousands)
Intangible assets:
Above market lease intangibles	$	203,460		$	13,232
In-place and other lease intangibles		618,153			133,582
Other intangibles		16,453			13,649
Accumulated amortization		(152,486	)		(100,808	)
Goodwill		288,196			19,901
Net intangible assets	$	973,776		$	79,556
Remaining weighted average amortization period of lease-related intangible assets in years		19.6			18.5
Intangible liabilities:
Below market lease intangibles	$	486,228		$	22,398
Other lease intangibles		157,971			—
Accumulated amortization		(26,425	)		(12,495	)
Net intangible liabilities	$	617,774		$	9,903
Remaining weighted average amortization period of lease-related intangible liabilities in years		18.5			6.9

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Condensed Consolidating Information (Details) (USD $) In Thousands	Sep. 30, 2011	Dec. 31, 2010	Sep. 30, 2010	Dec. 31, 2009
Assets
Net real estate investments	$ 16,417,628	$ 5,444,114
Cash and cash equivalents	57,482	21,812	33,790	107,397
Escrow deposits and restricted cash	84,783	38,940
Deferred financing costs, net	12,424	19,533
Investment in and advances to affiliates	0	0
Other assets	633,453	233,622
Total assets	17,205,770	5,758,021
Liabilities:
Senior notes payable and other debt	6,313,141	2,900,044
Intercompany loans	0	0
Accrued interest	65,985	19,296
Accounts payable and other liabilities	1,128,706	207,143
Deferred income taxes	274,852	241,333
Total liabilities	7,782,684	3,367,816
Redeemable OP unitholder interests	92,817	0
Total equity	9,330,269	2,390,205		2,484,060
Total liabilities and equity	17,205,770	5,758,021
Parent Company [Member]
Assets
Net real estate investments	464	937
Cash and cash equivalents	2,252	1,083	1,095
Escrow deposits and restricted cash	1,961	76
Deferred financing costs, net	2,914	2,691
Investment in and advances to affiliates	8,441,898	1,414,170
Other assets	67,190	75,794
Total assets	8,516,679	1,494,751
Liabilities:
Senior notes payable and other debt	229,363	225,644
Intercompany loans	(211,796)	(144,897)
Accrued interest	(218)	(113)
Accounts payable and other liabilities	95,091	41,355
Deferred income taxes	274,852	241,333
Total liabilities	387,292	363,322
Redeemable OP unitholder interests	0
Total equity	8,129,387	1,131,429
Total liabilities and equity	8,516,679	1,494,751
Wholly Owned Subsidiary Guarantors [Member]
Assets
Net real estate investments	3,388,426	3,244,243
Cash and cash equivalents	24,898	15,659	16,813	7,864
Escrow deposits and restricted cash	25,901	19,786
Deferred financing costs, net	725	1,961
Investment in and advances to affiliates	0	0
Other assets	196,204	119,773
Total assets	3,636,154	3,401,422
Liabilities:
Senior notes payable and other debt	235,185	539,564
Intercompany loans	843,546	586,605
Accrued interest	744	2,704
Accounts payable and other liabilities	174,086	103,444
Deferred income taxes	0	0
Total liabilities	1,253,561	1,232,317
Redeemable OP unitholder interests	0
Total equity	2,382,593	2,169,105
Total liabilities and equity	3,636,154	3,401,422
Ventas Issuers [Member]
Assets
Net real estate investments	566,852	688,158
Cash and cash equivalents	0	0		82,886
Escrow deposits and restricted cash	7,131	9,169
Deferred financing costs, net	2,298	7,961
Investment in and advances to affiliates	1,728,685	1,028,721
Other assets	8,134	8,057
Total assets	2,313,100	1,742,066
Liabilities:
Senior notes payable and other debt	2,240,589	1,301,089
Intercompany loans	(670,085)	(434,454)
Accrued interest	40,093	12,852
Accounts payable and other liabilities	17,867	15,712
Deferred income taxes	0	0
Total liabilities	1,628,464	895,199
Redeemable OP unitholder interests	0
Total equity	684,636	846,867
Total liabilities and equity	2,313,100	1,742,066
Non-Guarantor Subsidiaries [Member]
Assets
Net real estate investments	12,461,886	1,510,776
Cash and cash equivalents	30,332	5,070	15,882	16,647
Escrow deposits and restricted cash	49,790	9,909
Deferred financing costs, net	6,487	6,920
Investment in and advances to affiliates	0	0
Other assets	361,925	29,998
Total assets	12,910,420	1,562,673
Liabilities:
Senior notes payable and other debt	3,608,004	833,747
Intercompany loans	38,335	(7,254)
Accrued interest	25,366	3,853
Accounts payable and other liabilities	841,662	46,632
Deferred income taxes	0	0
Total liabilities	4,513,367	876,978
Redeemable OP unitholder interests	92,817
Total equity	8,304,236	685,695
Total liabilities and equity	12,910,420	1,562,673
Consolidated Eliminations [Member]
Assets
Net real estate investments	0	0
Cash and cash equivalents	0	0
Escrow deposits and restricted cash	0	0
Deferred financing costs, net	0	0
Investment in and advances to affiliates	(10,170,583)	(2,442,891)
Other assets	0	0
Total assets	(10,170,583)	(2,442,891)
Liabilities:
Senior notes payable and other debt	0	0
Intercompany loans	0	0
Accrued interest	0	0
Accounts payable and other liabilities	0	0
Deferred income taxes	0	0
Total liabilities	0	0
Redeemable OP unitholder interests	0
Total equity	(10,170,583)	(2,442,891)
Total liabilities and equity	$ (10,170,583)	$ (2,442,891)

XML

Segment Information (Tables)

9 Months Ended

Sep. 30, 2011

Segment Information [Abstract]

Summary information by business segment

For the three months ended September 30, 2011:

	Triple-Net		Senior
	Leased		Living		MOB		All
	Properties		Operations		Operations		Other		Total
	(In thousands)
Revenues:
Rental income	$	211,479	$	—	$	58,398	$	—	$	269,877
Resident fees and services		—		276,364		—		—		276,364
Medical office building and other services revenue		1,109		—		8,162		—		9,271
Income from loans and investments		—		—		—		10,072		10,072
Interest and other income		—		—		—		373		373
Total revenues	$	212,588	$	276,364	$	66,560	$	10,445	$	565,957
Total revenues	$	212,588	$	276,364	$	66,560	$	10,445	$	565,957
Less:
Interest and other income		—		—		—		373		373
Property-level operating expenses		—		188,856		20,305		—		209,161
Medical office building services costs		—		—		6,347		—		6,347
Segment NOI		212,588		87,508		39,908		10,072		350,076
Income from unconsolidated entities		121		—		61		—		182
Segment profit	$	212,709	$	87,508	$	39,969	$	10,072		350,258
Interest and other income										373
Interest expense										(73,756	)
Depreciation and amortization										(161,027	)
General, administrative and professional fees										(20,624	)
Loss on extinguishment of debt										(8,685	)
Litigation proceeds, net										85,327
Merger-related expenses and deal costs										(69,350	)
Other										(14,436	)
Income tax benefit										13,904
Net income									$	101,984

For the three months ended September 30, 2010:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	117,906	$	—	$	22,817		$	—	$	140,723
Resident fees and services		—		113,182		—			—		113,182
Medical office building and other services revenue		—		—		6,711			—		6,711
Income from loans and investments		—		—		—			4,014		4,014
Interest and other income		—		—		—			35		35
Total revenues	$	117,906	$	113,182	$	29,528		$	4,049	$	264,665
Total revenues	$	117,906	$	113,182	$	29,528		$	4,049	$	264,665
Less:
Interest and other income		—		—		—			35		35
Property-level operating expenses		—		74,066		7,941			—		82,007
Medical office building services costs		—		—		4,633			—		4,633
Segment NOI		117,906		39,116		16,954			4,014		177,990
Loss from unconsolidated entities		—		—		(392	)		—		(392	)
Segment profit	$	117,906	$	39,116	$	16,562		$	4,014		177,598
Interest and other income											35
Interest expense											(45,519	)
Depreciation and amortization											(52,104	)
General, administrative and professional fees											(15,278	)
Merger-related expenses and deal costs											(5,142	)
Other											419
Income tax expense											(1,657	)
Discontinued operations											542
Net income										$	58,894

For the nine months ended September 30, 2011:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	450,211	$	—	$	106,392		$	—	$	556,603
Resident fees and services		—		593,348		—			—		593,348
Medical office building and other services revenue		1,109		—		24,941			—		26,050
Income from loans and investments		—		—		—			24,548		24,548
Interest and other income		—		—		—			529		529
Total revenues	$	451,320	$	593,348	$	131,333		$	25,077	$	1,201,078
Total revenues	$	451,320	$	593,348	$	131,333		$	25,077	$	1,201,078
Less:
Interest and other income		—		—		—			529		529
Property-level operating expenses		—		403,706		37,259			—		440,965
Medical office building services costs		—		—		19,837			—		19,837
Segment NOI		451,320		189,642		74,237			24,548		739,747
Income (loss) from unconsolidated entities		121		—		(192	)		—		(71	)
Segment profit	$	451,441	$	189,642	$	74,045		$	24,548		739,676
Interest and other income											529
Interest expense											(170,046	)
Depreciation and amortization											(293,541	)
General, administrative and professional fees											(51,010	)
Loss on extinguishment of debt											(25,211	)
Litigation proceeds, net											85,327
Merger-related expenses and deal costs											(131,606	)
Other											(6,664	)
Income tax benefit											23,310
Net income										$	170,764

For the nine months ended September 30, 2010:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	351,625	$	—	$	47,246		$	—	$	398,871
Resident fees and services		—		331,535		—			—		331,535
Medical office building and other services revenue		—		—		6,711			—		6,711
Income from loans and investments		—		—		—			11,336		11,336
Interest and other income		—		—		—			420		420
Total revenues	$	351,625	$	331,535	$	53,957		$	11,756	$	748,873
Total revenues	$	351,625	$	331,535	$	53,957		$	11,756	$	748,873
Less:
Interest and other income		—		—		—			420		420
Property-level operating expenses		—		219,802		16,267			—		236,069
Medical office building services costs		—		—		4,633			—		4,633
Segment NOI		351,625		111,733		33,057			11,336		507,751
Loss from unconsolidated entities		—		—		(392	)		—		(392	)
Segment profit	$	351,625	$	111,733	$	32,665		$	11,336		507,359
Interest and other income											420
Interest expense											(133,449	)
Depreciation and amortization											(154,458	)
General, administrative and professional fees											(35,819	)
Loss on extinguishment of debt											(6,549	)
Merger-related expenses and deal costs											(11,668	)
Other											404
Income tax expense											(2,352	)
Discontinued operations											7,139
Net income										$	171,027

Assets by reportable business segment

	As of				As of
	September 30,				December 31,
	2011				2010
	(In thousands)
Assets:
Triple-net leased properties	$	8,652,706	50.3	%	$	2,474,612	43.0	%
Senior living operations		5,807,192	33.7			2,297,041	39.9
MOB operations		2,367,480	13.8			748,945	13.0
All other assets		378,392	2.2			237,423	4.1
Total assets	$	17,205,770	100.0	%	$	5,758,021	100.0	%

Capital expenditures

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands)
Capital expenditures:
Triple-net leased properties	$	68,604	$	211	$	69,831	$	12,303
Senior living operations		20,842		3,889		296,446		6,782
MOB operations		23,432		218,307		30,301		233,315
Total capital expenditures	$	112,878	$	222,407	$	396,578	$	252,400

Revenue

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands)
Revenues:
United States	$	542,533	$	246,358	$	1,132,047	$	695,252
Canada		23,424		18,307		69,031		53,621
Total revenues	$	565,957	$	264,665	$	1,201,078	$	748,873

Net real estate property

	As of		As of
	September 30,		December 31,
	2011		2010
	(In thousands)
Net real estate property:
United States	$	15,598,457	$	4,857,510
Canada		397,585		422,009
Total net real estate property	$	15,996,042	$	5,279,519

XML

Loans Receivable (Details) (USD $)	1 Months Ended										1 Months Ended	9 Months Ended
	Nov. 30, 2011	Oct. 31, 2011	Aug. 31, 2011	Jun. 30, 2011	Apr. 30, 2011	Mar. 31, 2011	Sep. 30, 2011	Dec. 31, 2010	Sep. 30, 2011 Nationwide Health Properties [Member] Senior unsecured term loan [Member]	May 31, 2011 Senior unsecured term loan [Member]	Jun. 30, 2011 First Mortgage loan maturing in 2016 [Member]	Sep. 30, 2011 Nationwide Health Properties [Member] Property HousingCommunity
Debt Instrument [Line Items]
Interest rate on term loan										5.00%
Aggregate principal amount of senior unsecured term loan									$ 800,000,000	$ 600,000,000
Accounts, Notes, Loans and Financing Receivable [Line Items]
Mortgage loan receivable												270,000,000
Number of senior housing and healthcare properties												53
Other loans												60,000,000
Interest rate on loans issued											9.00%
Loans Receivable (Textuals) [Abstract]
Net loans receivable							302,264,000	149,263,000
Gain Loss on Repayment of Loans Receivable	3,000,000		5,500,000		3,300,000	800,000
Proceeds from final repayment of the loan		6,400,000			112,400,000	19,900,000
Principal amount of first mortgage debt				$ 12,900,000								$ 400,000,000

XML

Fair Values of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2011

Fair Values of Financial Instruments [Abstract]

Carrying amounts and fair values of financial instruments

	September 30, 2011				December 31, 2010
	Carrying				Carrying
	Amount		Fair Value		Amount		Fair Value
	(In thousands)
Assets:
Cash and cash equivalents	$	57,482	$	57,482	$	21,812	$	21,812
Secured loans receivable, net		302,264		302,393		149,263		155,377
Derivative instruments		8,536		8,536		99		99
Marketable debt securities		42,788		42,788		66,675		66,675
Unsecured loans receivable, net		65,384		65,384		—		—
Liabilities:
Senior notes payable and other debt, gross		6,065,856		6,415,640		2,926,954		3,055,435
Derivative instruments		24,537		24,537		3,722		3,722
Contingent consideration liabilities		56,218		56,218		—		—
Redeemable OP unitholder interests		92,817		92,817		—		—

XML

Litigation

9 Months Ended

Sep. 30, 2011

Litigation [Abstract]

LITIGATION

NOTE 10 — LITIGATION

Litigation Relating to the Sunrise REIT Acquisition

On May 3, 2007, we filed a lawsuit against HCP, Inc. (“HCP”) in the United States District Court for the Western District of Kentucky (the “District Court”), entitled Ventas, Inc. v. HCP, Inc., Case No. 07-cv-238-JGH. We asserted claims of tortious interference with contract and tortious interference with prospective business advantage. Our complaint alleged that HCP interfered with our purchase agreement to acquire the assets and liabilities of Sunrise Senior Living Real Estate Investment Trust (“Sunrise REIT”) and with the process for unitholder consideration of the purchase agreement. The complaint alleged, among other things, that HCP made certain improper and misleading public statements and/or offers to acquire Sunrise REIT and that HCP’s actions caused us to suffer substantial damages, including, among other things, the payment of materially greater consideration to acquire Sunrise REIT resulting from the substantial increase in the purchase price above the original contract price necessary to obtain unitholder approval and increased costs associated with the delay in closing the acquisition, including increased costs to finance the transaction as a result of the delay.

HCP brought counterclaims against us alleging misrepresentation and negligent misrepresentation by Sunrise REIT related to its sale process, claiming that we were responsible for those actions as successor. HCP sought compensatory and punitive damages. On March 25, 2009, the District Court granted us judgment on the pleadings against all counterclaims brought by HCP and dismissed HCP’s counterclaims with prejudice. Thereafter, the District Court confirmed the dismissal of HCP’s counterclaims.

On July 16, 2009, the District Court denied HCP’s summary judgment motion as to our claim for tortious interference with business advantage, permitting us to present that claim against HCP at trial. The District Court granted HCP’s motion for summary judgment as to our claim for tortious interference with contract and dismissed that claim. The District Court also ruled that we could not seek to recover a portion of our alleged damages.

On September 4, 2009, the jury unanimously held that HCP tortiously interfered with our business expectation to acquire Sunrise REIT at the agreed price by employing significantly wrongful means such as fraudulent misrepresentation, deceit and coercion. The jury awarded us $101.6 million in compensatory damages, which is the full amount of damages the District Court permitted us to seek at trial. The District Court entered judgment on the jury’s verdict on September 8, 2009.

On November 16, 2009, the District Court affirmed the jury’s verdict and denied all of HCP’s post-trial motions, including a motion requesting that the District Court overturn the jury’s verdict and enter judgment for HCP or, in the alternative, award HCP a new trial. The District Court also denied our motion for pre-judgment interest and/or to modify the jury award to increase it to reflect the currency rates in effect on September 8, 2009, the date of entry of the judgment.

On November 17, 2009, HCP appealed the District Court’s judgment to the United States Court of Appeals for the Sixth Circuit (the “Sixth Circuit”). HCP argued that the judgment against it should be vacated and the case remanded for a new trial and/or that judgment should be entered in its favor as a matter of law.

On November 24, 2009, we filed a cross-appeal to the Sixth Circuit. In addition to maintaining the full benefit of our favorable jury verdict, in our cross-appeal, we asserted that we are entitled to substantial monetary relief in addition to the jury verdict, including punitive damages, additional compensatory damages and pre-judgment interest.

On December 11, 2009, HCP posted a $102.8 million letter of credit in our favor to serve as security to stay execution of the jury verdict pending the appellate proceedings.

On May 17, 2011, the Sixth Circuit unanimously affirmed the $101.6 million jury verdict in our favor and ruled that we are entitled to seek punitive damages against HCP for its conduct. The Sixth Circuit also denied our appeal seeking additional compensatory damages and pre-judgment interest. On June 27, 2011, the Sixth Circuit denied HCP’s motion to request a rehearing with respect to its decision.

On July 5, 2011, the Sixth Circuit issued a mandate terminating the appellate proceedings and transferring jurisdiction back to the District Court for the enforcement of the $101.6 million compensatory damages award and the trial for punitive damages. On July 26, 2011, the District Court issued an order scheduling a jury trial on the matter of punitive damages for February 21, 2012.

On August 22, 2011, the District Court ruled that HCP could not further delay enforcement of our $101.6 million compensatory damages award. On August 23, 2011, HCP paid us $102.8 million for the judgment plus certain costs and interest. After accrual of certain unpaid fees and $5.75 million in contingent fees for our outside legal counsel and payment of a $3 million donation to the Ventas Charitable Foundation, we recognized approximately $85 million in net proceeds from the compensatory damages award in our Consolidated Statements of Income.

On October 25, 2011, HCP filed a petition for certiorari with the U.S. Supreme Court seeking to challenge the Sixth Circuit’s May 17, 2011 decision affirming the compensatory damages award and ordering a trial on punitive damages.

We are vigorously pursuing proceedings in the District Court on the matter of punitive damages. We cannot assure you as to the outcome of HCP’s petition for certiorari to the U.S. Supreme Court, which we believe will not be granted, or the District Court trial on the matter of punitive damages.

Litigation Relating to the NHP Acquisition

In the weeks following the announcement of our acquisition of NHP on February 28, 2011, purported stockholders of NHP filed seven lawsuits against NHP and its directors. Six of these lawsuits also named Ventas, Inc. as a defendant and five named our subsidiary, Needles Acquisition LLC, as a defendant. The purported stockholder plaintiffs commenced these actions in two jurisdictions: the Superior Court of the State of California, Orange County (the “California State Court”); and the Circuit Court for Baltimore City, Maryland (the “Maryland State Court”). All of these actions were brought as putative class actions, and two also purport to assert derivative claims on behalf of NHP. All of these stockholder complaints allege that NHP’s directors breached certain alleged duties to NHP’s stockholders by approving the merger agreement with us, and certain complaints allege that NHP aided and abetted those breaches. Those complaints that name Ventas, Inc. and Needles Acquisition LLC allege that we aided and abetted the purported breaches of certain alleged duties by NHP’s directors. All of the complaints request an injunction of the merger. Certain of the complaints also seek damages.

In the California State Court, the following actions were filed purportedly on behalf of NHP stockholders: on February 28, 2011, a putative class action entitled Palma v. Nationwide Health Properties, Inc., et al.; on March 3, 2011, a putative class action entitled Barker v. Nationwide Health Properties, Inc., et al.; and on March 3, 2011, a putative class action entitled Davis v. Nationwide Health Properties, Inc., et al., which was subsequently amended on March 11, 2011 under the caption Davids v. Nationwide Health Properties, Inc., et al. Each action names NHP and members of the NHP board of directors as defendants. The Barker and Davids actions also name Ventas, Inc. as a defendant, and the Davids action names Needles Acquisition LLC as a defendant. Each complaint alleges, among other things, that NHP’s directors breached certain alleged duties by approving the merger agreement between us and NHP because the proposed transaction purportedly fails to maximize stockholder value and provides the directors personal benefits not shared by NHP stockholders, and the Barker and Davids actions allege that we aided and abetted those purported breaches. Along with other relief, the complaints seek an injunction against the closing of the proposed merger. On April 4, 2011, the defendants demurred and moved to stay the Palma, Barker, and Davids actions in favor of the parallel litigation in the Maryland State Court described below. On April 27, 2011, all three actions were consolidated pursuant to a Stipulation and Proposed Order on Consolidation of Related Actions signed by the parties on March 22, 2011. On May 12, 2011, the California State Court granted the defendants’ motion to stay.

In the Maryland State Court, the following actions were filed purportedly on behalf of NHP stockholders: on March 7, 2011, a putative class action entitled Crowley v. Nationwide Health Properties, Inc., et al.; on March 10, 2011, a putative class action entitled Taylor v. Nationwide Health Properties, Inc., et. al.; on March 17, 2011, a putative class action entitled Haughey Family Trust v. Pasquale, et al.; and on March 31, 2011, a putative class action entitled Rappoport v. Pasquale, et al. All four actions name NHP, its directors, Ventas, Inc. and Needles Acquisition LLC as defendants. All four actions allege, among other things, that NHP’s directors breached certain alleged duties by approving the merger agreement between us and NHP because the proposed transaction purportedly fails to maximize stockholder value and provides certain directors personal benefits not shared by NHP stockholders and that we aided and abetted those purported breaches. In addition to asserting direct claims on behalf of a putative class of NHP shareholders, the Haughey and Rappoport actions purport to bring derivative claims on behalf of NHP, asserting breaches of certain alleged duties by NHP’s directors in connection with their approval of the proposed transaction. All four actions seek to enjoin the proposed merger, and the Taylor action seeks damages.

On March 30, 2011, pursuant to stipulation of the parties, the Maryland State Court entered an order consolidating the Crowley, Taylor and Haughey actions. The Rappoport action was consolidated with the other actions on April 15, 2011.

On April 1, 2011, pursuant to stipulation of the parties, the Maryland State Court entered an order: (i) certifying a class of NHP shareholders; and (ii) providing for the plaintiffs to file a consolidated amended complaint. The plaintiffs filed a consolidated amended complaint on April 19, 2011, which the defendants moved to dismiss on April 29, 2011. Plaintiffs opposed that motion on May 9, 2011. Plaintiffs moved for expedited discovery on April 19, 2011, and the defendants simultaneously opposed that motion and moved for a protective order staying discovery on April 26, 2011. The Maryland State Court denied plaintiffs’ motion for expedited discovery and granted defendants’ motion for a protective order on May 3, 2011. On May 6, 2011, plaintiffs moved for reconsideration of the Maryland State Court’s grant of the protective order. The Maryland State Court denied the plaintiffs’ motion for reconsideration on May 11, 2011. On May 27, 2011, the Maryland State Court entered an order dismissing the consolidated action with prejudice. Plaintiffs moved for reconsideration of that order on June 6, 2011.

On June 9, 2011, we and NHP agreed on a settlement in principle with the plaintiffs in the consolidated action pending in Maryland State Court, which required us and NHP to make certain supplemental disclosures to stockholders concerning the merger. We and NHP made the supplemental disclosures on June 10, 2011. The settlement is subject to appropriate documentation by the parties and approval by the Maryland State Court.

We believe that each of these actions is without merit.

Proceedings against Tenants, Operators and Managers

From time to time, Kindred, Brookdale Senior Living, Sunrise, Atria and our other tenants, operators and managers are parties to certain legal actions, regulatory investigations and claims arising in the conduct of their business and operations. Even though we generally are not party to these proceedings, the unfavorable resolution of any such actions, investigations or claims could, individually or in the aggregate, materially adversely affect such tenants’, operators’ or managers’ liquidity, financial condition or results of operations and their ability to satisfy their respective obligations to us, which, in turn, could have a Material Adverse Effect on us.

Proceedings Indemnified and Defended by Third Parties

From time to time, we are party to certain legal actions, regulatory investigations and claims against which third parties are contractually obligated to indemnify and defend us and hold us harmless. The tenants of our triple-net leased properties and, in some cases, affiliates of the tenants are required by the terms of their leases and other agreements with us to indemnify, defend and hold us harmless against certain actions, investigations and claims arising in the course of their business and related to the operations of our triple-net leased properties. In addition, third parties from whom we acquired certain of our assets are required by the terms of the related conveyance documents to indemnify, defend and hold us harmless against certain actions, investigations and claims related to the conveyed assets and arising prior to our ownership. In some cases, we hold a portion of the purchase price consideration in escrow as collateral for the indemnification obligations of third parties related to acquired assets. Certain tenants and other obligated third parties are currently defending us in these types of matters. We cannot assure you that our tenants or their affiliates or other obligated third parties will continue to defend us in these matters, that our tenants or their affiliates or other obligated third parties will have sufficient assets, income and access to financing to enable them to satisfy their defense and indemnification obligations to us or that any purchase price consideration held in escrow will be sufficient to satisfy claims for which we are entitled to indemnification. The unfavorable resolution of any such actions, investigations or claims could, individually or in the aggregate, materially adversely affect our tenants’ or other obligated third parties’ liquidity, financial condition or results of operations and their ability to satisfy their respective obligations to us, which, in turn, could have a Material Adverse Effect on us.

Proceedings Arising in Connection with Senior Living and MOB Operations; Other Litigation

From time to time, we are also party to various legal actions, regulatory investigations and claims (some of which may not be insured) arising in connection with our senior living and MOB operations or otherwise in the course of our business. In limited circumstances, the manager of the applicable seniors housing community or MOB may be contractually obligated to indemnify, defend and hold us harmless against such actions, investigations and claims. It is the opinion of management that, except as otherwise set forth in this Note 10, the disposition of any such actions, investigations and claims that are currently pending will not, individually or in the aggregate, have a Material Adverse Effect on us. However, regardless of their merits, these matters may force us to expend significant financial resources. We are unable to predict the ultimate outcome of these actions, investigations and claims, and if management’s assessment of our liability with respect thereto is incorrect, such actions, investigations and claims could have a Material Adverse Effect on us.

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Elmcroft II Portfolio Update (Details)	9 Months Ended
	Sep. 30, 2011 Segment Property Year State Province License LeaseRenewal
Elmcroft II Portfolio Update (Textuals) [Abstract]
Number of seniors housing communities acquired operated by Hearthstone	32
Master lease period	15 years
Number of master lease renewals pursuant to lease terms	2
Duration of master lease per renewal pursuant to lease terms	5 years
Number of licenses granted	11
Elmcroft Senior Living [Member]
Portfolio Operator Transition Update [Line Items]
Senior housing communities operating together with affiliates	64
Senior Housing Communities [Member]
Portfolio Operator Transition Update [Line Items]
Number of states which has triple net seniors housing communities	10

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Segment Information (Details Textuals) (USD $)	9 Months Ended
	Sep. 30, 2011 Segment Property Year
Segment Information (Textuals) [Abstract]
Intersegment sales	$ 0
Number of reportable business segments	3

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Concentration of Credit Risk

9 Months Ended

Sep. 30, 2011

Concentration of Credit Risk [Abstract]

CONCENTRATION OF CREDIT RISK

NOTE 3 — CONCENTRATION OF CREDIT RISK

As of September 30, 2011, Atria, Sunrise, Brookdale Senior Living and Kindred managed or operated approximately 18.7%, 14.4%, 13.0% and 5.0%, respectively, of our properties based on their gross book value. Also, as of September 30, 2011, seniors housing communities constituted approximately 66.2% of our real estate portfolio based on gross book value, with skilled nursing facilities, hospitals, MOBs and other healthcare assets collectively comprising the remaining 33.8%. Our properties were located in 46 states, the District of Columbia and two Canadian provinces as of September 30, 2011, with properties in only one state (California) accounting for more than 10% of our total revenues or net operating income (“NOI”, which is defined as total revenues, excluding interest and other income, less property-level operating expenses and medical office building services costs) for the three months then ended.

Triple-Net Leased Properties

For the three months ended September 30, 2011 and 2010, approximately 11.3% and 23.5%, respectively, of our total revenues and 18.3% and 34.8%, respectively, of our total NOI (including amounts in discontinued operations) were derived from our four Kindred Master Leases. For the same periods, approximately 8.1% and 11.3%, respectively, of our total revenues and 13.1% and 16.8%, respectively, of our total NOI (including amounts in discontinued operations) were derived from our lease agreements with Brookdale Senior Living. Each of the Kindred Master Leases and our leases with Brookdale Senior Living is a triple-net lease pursuant to which the tenant is required to pay all property-related expenses and to comply with the terms of the mortgage financing documents, if any, affecting the properties.

Because the properties we lease to Kindred and Brookdale Senior Living account for a significant portion of our total revenues and NOI, Kindred’s and Brookdale Senior Living’s financial condition and ability and willingness to satisfy their obligations under their respective leases and other agreements with us, and their willingness to renew those leases upon expiration of the terms thereof, have a notable impact on our results of operations and ability to service our indebtedness and to make distributions to our stockholders. We cannot assure you that either Kindred or Brookdale Senior Living will have sufficient assets, income and access to financing to enable it to satisfy its obligations, and any inability or unwillingness on its part to do so could have a material adverse effect on our business, financial condition, results of operations and liquidity, on our ability to service our indebtedness and other obligations and on our ability to make distributions to our stockholders, as required for us to continue to qualify as a REIT (a “Material Adverse Effect”). We also cannot assure you that either Kindred or Brookdale Senior Living will elect to renew its leases with us upon expiration of the initial base terms or any renewal terms thereof or that, if some or all of those leases are not renewed, we will be able to reposition the affected properties on a timely basis or on the same or better terms, if at all.

The properties we lease to Kindred pursuant to the Kindred Master Leases are grouped into bundles containing a varying number of properties. All properties within a single bundle have the same primary lease term of ten to fifteen years from May 1, 1998 and, provided certain conditions are satisfied, each bundle is subject to three five-year renewal terms at the tenant’s option. The current lease term for ten bundles covering a total of 89 triple-net properties (the “Renewal Assets”) leased to Kindred will expire on April 13, 2013 unless Kindred provides us with renewal notices with respect to one or more of those bundles on or before April 30, 2012. The ten bundles expiring in 2013 each contain six or more properties, including at least one hospital, and collectively represent $122.8 million of annual base rent from May 1, 2011 through April 30, 2012. Kindred is required to continue to perform all of its obligations under the applicable lease for the properties within any bundle that is not renewed until expiration of the term on April 30, 2013, including without limitation payment of all rental amounts. Therefore, as to any bundles for which we do not receive a renewal notice, we will have at least one year to arrange for the repositioning of the applicable properties with new operators. Moreover, we own or have the rights to all licenses and certificates of need at the properties, and Kindred has extensive and detailed obligations to cooperate and ensure an orderly transition of the properties to another operator. While we believe that aggregate current rents for the Renewal Assets approximate current market rents, we cannot assure you that Kindred will elect to renew any or all of the bundles comprising the Renewal Assets or, if Kindred does not renew one or more of such bundles that we will be able to reposition the affected properties on a timely basis or on the same or better terms, if at all.

Six of the ten bundles up for renewal in 2013, containing 53 assets and representing $66 million of annual base rent, are in the second five-year renewal period and, therefore, we have a unilateral bundle-by-bundle option to initiate a fair market rental reset process on any of these six bundles that may be renewed by Kindred. If we elect to initiate the fair market rental reset process for any of these six renewal bundles, the renewal rent will be the higher of contract rent and fair market rent determined by an appraisal process set forth in the applicable Kindred Master Lease. In certain cases following initiation by us of a fair market rental reset process respecting a renewal bundle, Kindred may have the right to revoke its renewal of that particular bundle.

The determination of the market rent, whether on re-leasing or under the reset process, is dependent on and may be influenced by a variety of factors and is highly speculative, and there can be no assurances regarding what market rent may be for any of the Renewal Assets.

Senior Living Operations

As of September 30, 2011, Sunrise and Atria, collectively, provided comprehensive property management and accounting services with respect to 196 of our seniors housing communities for which we pay an annual management fee pursuant to long-term management agreements. Each management agreement with Sunrise has a term of 30 years, and each management agreement with Atria has a term of ten years, subject to successive automatic ten-year renewal periods. While Sunrise and Atria do not lease properties from us and, therefore, we are not directly exposed to credit risk with respect to those entities, any inability by Sunrise or Atria to efficiently and effectively manage our properties or to provide timely and accurate accounting information with respect thereto could have a Material Adverse Effect on us. Although we have various rights as the property owner under our management agreements, we rely on Sunrise’s and Atria’s personnel, good faith, expertise, historical performance, technical resources and information systems, proprietary information and judgment to manage our seniors housing communities efficiently and effectively. We also rely on Sunrise and Atria to set resident fees and otherwise operate those properties in compliance with our management agreements. Sunrise’s or Atria’s inability or unwillingness to satisfy its obligations under our management agreements, changes in Sunrise’s or Atria’s senior management or any adverse developments in Sunrise’s or Atria’s business and affairs or financial condition could have a Material Adverse Effect on us.

Kindred, Brookdale Senior Living, Sunrise and Atria Information

Each of Kindred, Brookdale Senior Living and Sunrise is subject to the reporting requirements of the SEC and is required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information. The information related to Kindred, Brookdale Senior Living and Sunrise contained or referred to in this Quarterly Report on Form 10-Q is derived from filings made by Kindred, Brookdale Senior Living or Sunrise, as the case may be, with the SEC or other publicly available information, or has been provided to us by Kindred, Brookdale Senior Living or Sunrise. We have not verified this information either through an independent investigation or by reviewing Kindred’s, Brookdale Senior Living’s or Sunrise’s public filings. We have no reason to believe that this information is inaccurate in any material respect, but we cannot assure you that all of this information is accurate. Kindred’s, Brookdale Senior Living’s and Sunrise’s filings with the SEC can be found at the SEC’s website at www.sec.gov. We are providing this data for informational purposes only, and you are encouraged to obtain Kindred’s, Brookdale Senior Living’s and Sunrise’s publicly available filings from the SEC.

Atria is not subject to the reporting requirements of the SEC. The information related to Atria contained or referred to within this Quarterly Report on Form 10-Q has been provided to us by Atria. We have not verified this information through an independent investigation. We have no reason to believe that this information is inaccurate in any material respect, but we cannot assure you that all of this information is accurate.

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Earnings per Common Share

9 Months Ended

Sep. 30, 2011

Earnings Per Common Share [Abstract]

EARNINGS PER COMMON SHARE

NOTE 13 — EARNINGS PER COMMON SHARE

The following table shows the amounts used in computing basic and diluted earnings per common share:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Numerator for basic and diluted earnings per share:
Income from continuing operations attributable to common stockholders	$	102,885	$	57,356	$	171,545	$	161,445
Discontinued operations		—		542		—		7,139
Net income attributable to common stockholders	$	102,885	$	57,898	$	171,545	$	168,584
Denominator:
Denominator for basic earnings per share — weighted average shares		287,365		156,631		208,470		156,566
Effect of dilutive securities:
Stock options		412		451		458		375
Restricted stock awards		38		95		57		62
OP units		1,868		—		630		—
Convertible notes		1,111		764		1,235		450
Denominator for diluted earnings per share — adjusted weighted average shares		290,794		157,941		210,850		157,453
Basic earnings per share:
Income from continuing operations attributable to common stockholders	$	0.36	$	0.37	$	0.82	$	1.03
Discontinued operations		—		0.00		—		0.05
Net income attributable to common stockholders	$	0.36	$	0.37	$	0.82	$	1.08
Diluted earnings per share:
Income from continuing operations attributable to common stockholders	$	0.35	$	0.37	$	0.81	$	1.02
Discontinued operations		—		0.00		—		0.05
Net income attributable to common stockholders	$	0.35	$	0.37	$	0.81	$	1.07

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Condensed Consolidating Information (Details 1) (USD $) In Thousands	3 Months Ended			9 Months Ended		12 Months Ended
	Sep. 30, 2011	Mar. 31, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010	Dec. 31, 2010
Revenues:
Rental income	$ 269,877		$ 140,723	$ 556,603	$ 398,871
Resident fees and services	276,364		113,182	593,348	331,535
Medical office building and other services revenues	9,271		6,711	26,050	6,711
Income from loans and investments	10,072		4,014	24,548	11,336
Interest and other income	373		35	529	420
Total revenues	565,957		264,665	1,201,078	748,873
Expenses:
Interest	73,756		45,519	170,046	133,449
Depreciation and amortization	161,027		52,104	293,541	154,458
Property-level operating expenses	209,161		82,007	440,965	236,069
Medical office building services costs	6,347		4,633	19,837	4,633
General, administrative and professional fees	20,624		15,278	51,010	35,819
Loss on extinguishment of debt	8,685	16,500		25,211	6,549
Litigation proceeds, net	(85,327)			(85,327)
Merger-related expenses and deal costs	69,350		5,142	131,606	11,668
Other	14,436		(419)	6,664	(404)
Total expenses	478,059		204,264	1,053,553	582,241
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest	87,898		60,401	147,525	166,632
Income (loss) from unconsolidated entities	182		(392)	(71)	(392)
Income tax benefit (expense)	13,904		(1,657)	23,310	(2,352)
Income from continuing operations	101,984		58,352	170,764	163,888
Discontinued operations			542		7,139
Net income	101,984		58,894	170,764	171,027	249,729
Net income (loss) attributable to noncontrolling interest, net of tax	(901)		996	(781)	2,443
Net income attributable to common stockholders	102,885		57,898	171,545	168,584
Parent Company [Member]
Revenues:
Rental income	623		607	1,848	1,802
Income from loans and investments	1,124		1,406	5,070	4,247
Equity earnings in affiliates	52,119		61,077	160,275	176,659
Interest and other income	6		18	96	310
Total revenues	53,872		63,108	167,289	183,018
Expenses:
Interest	392		820	(474)	1,096
Depreciation and amortization	440		412	1,273	1,219
General, administrative and professional fees	1,194		203	(5,840)	323
Litigation proceeds, net				(85,327)
Merger-related expenses and deal costs	47,309		3,573	108,509	10,041
Other	883		(477)	913	(435)
Total expenses	(35,109)		4,531	19,054	12,244
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest	88,981		58,577	148,235	170,774
Income tax benefit (expense)	13,904		(679)	23,310	(2,190)
Income from continuing operations			57,898		168,584
Net income	102,885		57,898	171,545	168,584
Net income attributable to common stockholders	102,885		57,898	171,545	168,584
Wholly Owned Subsidiary Guarantors [Member]
Revenues:
Rental income	55,453		52,463	165,454	141,317
Resident fees and services	100,885		65,252	252,803	190,801
Medical office building and other services revenues	8,162		6,711	24,941	6,711
Income from loans and investments	428		755	2,495	1,635
Equity earnings in affiliates	258		439	1,102	1,307
Interest and other income	7		4	19	40
Total revenues	165,193		125,624	446,814	341,811
Expenses:
Interest	14,241		18,386	45,409	56,371
Depreciation and amortization	34,908		28,889	95,651	84,084
Property-level operating expenses	78,415		46,908	192,137	132,036
Medical office building services costs	6,347		4,633	19,837	4,633
General, administrative and professional fees	9,074		8,311	28,101	16,870
Loss on extinguishment of debt				16,526	102
Merger-related expenses and deal costs	674		1,569	1,730	1,617
Other	1,863		60	2,950	31
Total expenses	145,522		108,756	402,341	295,744
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest	19,671		16,868	44,473	46,067
Income tax benefit (expense)			(978)		(162)
Income from continuing operations			15,890		45,905
Discontinued operations			422		1,132
Net income	19,671		16,312	44,473	47,037
Net income (loss) attributable to noncontrolling interest, net of tax			352		1,134
Net income attributable to common stockholders	19,671		15,960	44,473	45,903
Ventas Issuers [Member]
Revenues:
Rental income	71,611		70,534	212,653	209,879
Income from loans and investments	103		1,853	8,566	5,454
Interest and other income	10		21	52	63
Total revenues	71,724		72,408	221,271	215,396
Expenses:
Interest	21,952		13,261	53,457	39,658
Depreciation and amortization	8,795		9,296	26,706	28,429
Property-level operating expenses	115		134	414	398
General, administrative and professional fees	6,427		5,575	21,625	15,414
Loss on extinguishment of debt	8,685			8,685	6,447
Total expenses	45,974		28,266	110,887	90,346
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest	25,750		44,142	110,384	125,050
Income (loss) from unconsolidated entities	61		(392)	(192)	(392)
Income from continuing operations			43,750		124,658
Discontinued operations			120		6,007
Net income	25,811		43,870	110,192	130,665
Net income attributable to common stockholders	25,811		43,870	110,192	130,665
Non-Guarantor Subsidiaries [Member]
Revenues:
Rental income	142,190		17,119	176,648	45,873
Resident fees and services	175,479		47,930	340,545	140,734
Medical office building and other services revenues	1,109			1,109
Income from loans and investments	8,417			8,417
Interest and other income	350		(8)	362	7
Total revenues	327,545		65,041	527,081	186,614
Expenses:
Interest	37,171		13,052	71,654	36,324
Depreciation and amortization	116,884		13,507	169,911	40,726
Property-level operating expenses	130,631		34,965	248,414	103,635
General, administrative and professional fees	3,929		1,189	7,124	3,212
Merger-related expenses and deal costs	21,367			21,367	10
Other	11,690		(2)	2,801
Total expenses	321,672		62,711	521,271	183,907
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest	5,873		2,330	5,810	2,707
Income (loss) from unconsolidated entities	121			121
Income from continuing operations			2,330		2,707
Net income	5,994		2,330	5,931	2,707
Net income (loss) attributable to noncontrolling interest, net of tax	(901)		644	(781)	1,309
Net income attributable to common stockholders	6,895		1,686	6,712	1,398
Consolidated Eliminations [Member]
Revenues:
Equity earnings in affiliates	(52,377)		(61,516)	(161,377)	(177,966)
Total revenues	(52,377)		(61,516)	(161,377)	(177,966)
Expenses:
Income before income (loss) from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest	(52,377)		(61,516)	(161,377)	(177,966)
Income from continuing operations			(61,516)		(177,966)
Net income	(52,377)		(61,516)	(161,377)	(177,966)
Net income attributable to common stockholders	$ (52,377)		$ (61,516)	$ (161,377)	$ (177,966)

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Acquisitions of Real Estate Property (Details 1) (USD $) In Thousands, except Per Share data	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010
The effect of material acquisitions on net income and earnings per share
Revenues	$ 565,424	$ 556,779	$ 1,698,376	$ 1,625,552
Income from continuing operations attributable to common stockholders	183,517	90,891	399,249	280,216
Discontinued operations		542		7,139
Net income attributable to common stockholders	$ 183,517	$ 91,433	$ 399,249	$ 287,355
Basic:
Income from continuing operations attributable to common stockholders	$ 0.64	$ 0.32	$ 1.39	$ 1.00
Discontinued operations		$ 0.00		$ 0.02
Net income attributable to common stockholders	$ 0.64	$ 0.32	$ 1.39	$ 1.02
Diluted:
Income from continuing operations attributable to common stockholders	$ 0.63	$ 0.32	$ 1.38	$ 0.99
Discontinued operations		$ 0.00		$ 0.03
Net income attributable to common stockholders	$ 0.63	$ 0.32	$ 1.38	$ 1.02
Weighted average shares used in computing earnings per common share:
Basic	287,365	281,439	286,647	281,374
Diluted	290,794	282,749	289,027	282,261

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Senior Notes Payable and Other Debt (Tables)

9 Months Ended

Sep. 30, 2011

Senior Notes Payable and Other Debt [Abstract]

Summary of Senior notes payable and other debt

	September 30,			December 31,
	2011			2010
	(In thousands)
Unsecured revolving credit facilities	$	474,000		$	40,000
37/8% Convertible Senior Notes due 2011		230,000			230,000
9% Senior Notes due 2012		82,433			82,433
81/4% Senior Notes due 2012		72,950			—
Unsecured term loan due 2012		250,000			—
Unsecured term loan due 2013		200,000			200,000
6.25% Senior Notes due 2013		269,850			—
3.125% Senior Notes due 2015		400,000			400,000
6% Senior Notes due 2015		234,420			—
61/2% Senior Notes due 2016		200,000			400,000
63/4% Senior Notes due 2017		225,000			225,000
4.750% Senior Notes due 2021		700,000			—
6.90% Senior Notes due 2037		52,400			—
6.59% Senior Notes due 2038		22,973			—
Mortgage loans and other		2,651,830			1,349,521
Total		6,065,856			2,926,954
Capital lease obligations		143,119			—
Unamortized fair value adjustment		145,647			11,790
Unamortized commission fees and discounts		(41,481	)		(38,700	)
Senior notes payable and other debt	$	6,313,141		$	2,900,044

Scheduled maturities of borrowing arrangements and other provisions excluding capital lease obligations

			Unsecured
	Principal Amount		Revolving Credit		Scheduled Periodic
	Due at Maturity		Facilities (1)		Amortization		Total Maturities
	(In thousands)
2011	$	230,700	$	—	$	12,798	$	243,498
2012 (2)		517,913		474,000		50,347		1,042,260
2013		872,623		—		44,110		916,733
2014		220,891		—		39,998		260,889
2015		835,792		—		32,503		868,295
Thereafter (3)		2,539,451		—		194,730		2,734,181
Total maturities	$	5,217,370	$	474,000	$	374,486	$	6,065,856

Future minimum lease payments required under the capital lease agreements

2011	$	2,343
2012		9,446
2013		9,573
2014		9,699
2015		9,826
Thereafter		172,553
Total minimum lease payments		213,440
Less: Amount related to interest		(70,321	)
	$	143,119

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Consolidated Statements of Income (Unaudited) (Parenthetical) (USD $) In Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010
Expenses:
Net (loss) income attributable to noncontrolling interest, tax	$ 0	$ 613	$ 0	$ 1,591

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Related Party Transactions

9 Months Ended

Sep. 30, 2011

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 14 — RELATED PARTY TRANSACTIONS

Upon consummation of the Atria Senior Living acquisition, we entered into long-term management agreements with Atria to operate the acquired assets. Atria is owned by private equity funds managed by Lazard Real Estate Partners LLC (“LREP”). Effective May 13, 2011, LREP Chief Executive Officer and Managing Principal and Atria Chairman Matthew J. Lustig was appointed to our Board of Directors pursuant to the terms of a Director Appointment Agreement between us and the sellers of the acquired assets. For the three months ended September 30, 2011 and for the period from May 12, 2011 through September 30, 2011, we paid Atria $7.9 million and $12.1 million, respectively, in management fees related to the Atria Senior Living properties.

From time to time, we may engage Cushman & Wakefield, a global commercial real estate firm, to act as a leasing agent with respect to certain of our MOBs. Cushman & Wakefield President and Chief Executive Officer Glenn J. Rufrano has served as a member of our Board of Directors since June 2010. We believe the brokers’ fees we pay to Cushman & Wakefield in connection with the provision of these services are customary and represent market rates. Total fees we paid to Cushman & Wakefield during the first nine months of 2011 were de minimis.

Effective upon consummation of the NHP acquisition, Richard I. Gilchrist, a former NHP director, was appointed to our Board of Directors. Mr. Gilchrist currently serves as Senior Advisor to The Irvine Company, and from 2006 until July 2011, he served as President of The Irvine Company’s Investment Properties Group, from whom NHP leased its corporate headquarters prior to the acquisition. Nationwide Health Properties, LLC, the successor to NHP and our wholly owned subsidiary, continues to rent office space in the building owned by The Irvine Company. For both the three and nine months ended September 30, 2011, we paid $0.1 million to The Irvine Company.

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Senior Notes Payable and Other Debt (Details) (USD $) In Thousands	Sep. 30, 2011	Dec. 31, 2010	Sep. 30, 2011 Principal Amount Due at Maturity [Member]	Nov. 02, 2011 Unsecured Revolving Credit Facilities [Member]	Sep. 30, 2011 Unsecured Revolving Credit Facilities [Member]		Sep. 30, 2011 Scheduled Periodic Amortization [Member]	Sep. 30, 2011 3 7/8 % Convertible Senior Notes due 2011 [Member]	Dec. 31, 2010 3 7/8 % Convertible Senior Notes due 2011 [Member]	Sep. 30, 2011 9% Senior Notes due 2012 [Member]	Dec. 31, 2010 9% Senior Notes due 2012 [Member]	Sep. 30, 2011 3.125% Senior Notes due 2015 [Member]	Dec. 31, 2010 3.125% Senior Notes due 2015 [Member]	Sep. 30, 2011 8 1/4% Senior Notes due 2012 [Member]	Sep. 30, 2011 Unsecured term loan due 2012 [Member]	Sep. 30, 2011 Unsecured term loan due 2013 [Member]	Dec. 31, 2010 Unsecured term loan due 2013 [Member]	Sep. 30, 2011 6.25% Senior Notes due 2013 [Member]	Sep. 30, 2011 6% Senior Notes due 2015 [Member]	Sep. 30, 2011 6.90% Senior Notes due 2037 [Member]	Sep. 30, 2011 6.59% Senior Notes due 2038 [Member]	Sep. 30, 2011 6 1/2% Senior Notes due 2016 [Member]	Dec. 31, 2010 6 1/2% Senior Notes due 2016 [Member]	Sep. 30, 2011 6 3/4% Senior Notes due 2017 [Member]	Dec. 31, 2010 6 3/4% Senior Notes due 2017 [Member]	Sep. 30, 2011 4.750% Senior Notes due 2021 [Member]
Long-term debt and certain interest rate and maturity information
Line of credit	$ 474,000,000	$ 40,000
Senior Notes								230,000	230,000	82,433	82,433	400,000	400,000	72,950				269,850	234,420	52,400	22,973	200,000	400,000	225,000	225,000	700,000
Unsecured term loan due				727,000											250,000	200,000	200,000
Mortgage loans and other	2,651,830	1,349,521
Total	6,065,856	2,926,954	5,217,370		474,000	[1]	374,486
Capital lease obligations	143,119
Unamortized fair value adjustment	145,647	11,790
Unamortized commission fees and discounts	(41,481)	(38,700)
Senior notes payable and other debt	$ 6,313,141	$ 2,900,044

[1] At September 30, 2011, we had $57.5 million of unrestricted cash and cash equivalents, for $416.5 million of net borrowings outstanding under our unsecured revolving credit facilities. On October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new $2.0 billion unsecured revolving credit facility due 2015. See "Unsecured Revolving Credit Facilities and Term Loans" below.

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Segment Information

9 Months Ended

Sep. 30, 2011

Segment Information [Abstract]

SEGMENT INFORMATION

NOTE 16 — SEGMENT INFORMATION

As of September 30, 2011, we operated through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. Our triple-net leased properties segment consists of acquiring and owning seniors housing and healthcare properties in the United States and leasing those properties to healthcare operating companies under “triple-net” or “absolute-net” leases, which require the tenants to pay all property-related expenses. Our senior living operations segment consists of investments in seniors housing communities located in the United States and Canada for which we engage independent third parties, such as Sunrise and Atria, to manage the operations. Our MOB operations segment primarily consists of acquiring, owning, developing, leasing and managing MOBs. Information provided for “all other” includes revenues such as income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to our three reportable business segments. Assets included in all other consist primarily of corporate assets, including cash, restricted cash, deferred financing costs, loans receivable and miscellaneous accounts receivable.

We evaluate performance of the combined properties in each reportable business segment based on segment profit, which we define as NOI adjusted for gain/loss from unconsolidated entities. We define NOI as total revenues, less interest and other income, property-level operating expenses and medical office building services costs. We believe that net income, as defined by GAAP, is the most appropriate earnings measurement. However, we believe that segment profit serves as a useful supplement to net income because it allows investors, analysts and our management to measure unlevered property-level operating results and to compare our operating results to the operating results of other real estate companies and between periods on a consistent basis. Segment profit should not be considered as an alternative to net income (determined in accordance with GAAP) as an indicator of our financial performance. In order to facilitate a clear understanding of our consolidated historical operating results, segment profit should be examined in conjunction with net income as presented in our Consolidated Financial Statements and data included elsewhere in this Quarterly Report on Form 10-Q.

Interest expense, depreciation and amortization, general, administrative and professional fees, and non-property specific revenues and expenses are not allocated to individual reportable business segments for purposes of assessing segment performance. There are no intersegment sales or transfers.

Summary information by reportable business segment is as follows:

For the three months ended September 30, 2011:

	Triple-Net		Senior
	Leased		Living		MOB		All
	Properties		Operations		Operations		Other		Total
	(In thousands)
Revenues:
Rental income	$	211,479	$	—	$	58,398	$	—	$	269,877
Resident fees and services		—		276,364		—		—		276,364
Medical office building and other services revenue		1,109		—		8,162		—		9,271
Income from loans and investments		—		—		—		10,072		10,072
Interest and other income		—		—		—		373		373
Total revenues	$	212,588	$	276,364	$	66,560	$	10,445	$	565,957
Total revenues	$	212,588	$	276,364	$	66,560	$	10,445	$	565,957
Less:
Interest and other income		—		—		—		373		373
Property-level operating expenses		—		188,856		20,305		—		209,161
Medical office building services costs		—		—		6,347		—		6,347
Segment NOI		212,588		87,508		39,908		10,072		350,076
Income from unconsolidated entities		121		—		61		—		182
Segment profit	$	212,709	$	87,508	$	39,969	$	10,072		350,258
Interest and other income										373
Interest expense										(73,756	)
Depreciation and amortization										(161,027	)
General, administrative and professional fees										(20,624	)
Loss on extinguishment of debt										(8,685	)
Litigation proceeds, net										85,327
Merger-related expenses and deal costs										(69,350	)
Other										(14,436	)
Income tax benefit										13,904
Net income									$	101,984

For the three months ended September 30, 2010:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	117,906	$	—	$	22,817		$	—	$	140,723
Resident fees and services		—		113,182		—			—		113,182
Medical office building and other services revenue		—		—		6,711			—		6,711
Income from loans and investments		—		—		—			4,014		4,014
Interest and other income		—		—		—			35		35
Total revenues	$	117,906	$	113,182	$	29,528		$	4,049	$	264,665
Total revenues	$	117,906	$	113,182	$	29,528		$	4,049	$	264,665
Less:
Interest and other income		—		—		—			35		35
Property-level operating expenses		—		74,066		7,941			—		82,007
Medical office building services costs		—		—		4,633			—		4,633
Segment NOI		117,906		39,116		16,954			4,014		177,990
Loss from unconsolidated entities		—		—		(392	)		—		(392	)
Segment profit	$	117,906	$	39,116	$	16,562		$	4,014		177,598
Interest and other income											35
Interest expense											(45,519	)
Depreciation and amortization											(52,104	)
General, administrative and professional fees											(15,278	)
Merger-related expenses and deal costs											(5,142	)
Other											419
Income tax expense											(1,657	)
Discontinued operations											542
Net income										$	58,894

For the nine months ended September 30, 2011:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	450,211	$	—	$	106,392		$	—	$	556,603
Resident fees and services		—		593,348		—			—		593,348
Medical office building and other services revenue		1,109		—		24,941			—		26,050
Income from loans and investments		—		—		—			24,548		24,548
Interest and other income		—		—		—			529		529
Total revenues	$	451,320	$	593,348	$	131,333		$	25,077	$	1,201,078
Total revenues	$	451,320	$	593,348	$	131,333		$	25,077	$	1,201,078
Less:
Interest and other income		—		—		—			529		529
Property-level operating expenses		—		403,706		37,259			—		440,965
Medical office building services costs		—		—		19,837			—		19,837
Segment NOI		451,320		189,642		74,237			24,548		739,747
Income (loss) from unconsolidated entities		121		—		(192	)		—		(71	)
Segment profit	$	451,441	$	189,642	$	74,045		$	24,548		739,676
Interest and other income											529
Interest expense											(170,046	)
Depreciation and amortization											(293,541	)
General, administrative and professional fees											(51,010	)
Loss on extinguishment of debt											(25,211	)
Litigation proceeds, net											85,327
Merger-related expenses and deal costs											(131,606	)
Other											(6,664	)
Income tax benefit											23,310
Net income										$	170,764

For the nine months ended September 30, 2010:

	Triple-Net		Senior
	Leased		Living		MOB			All
	Properties		Operations		Operations			Other		Total
	(In thousands)
Revenues:
Rental income	$	351,625	$	—	$	47,246		$	—	$	398,871
Resident fees and services		—		331,535		—			—		331,535
Medical office building and other services revenue		—		—		6,711			—		6,711
Income from loans and investments		—		—		—			11,336		11,336
Interest and other income		—		—		—			420		420
Total revenues	$	351,625	$	331,535	$	53,957		$	11,756	$	748,873
Total revenues	$	351,625	$	331,535	$	53,957		$	11,756	$	748,873
Less:
Interest and other income		—		—		—			420		420
Property-level operating expenses		—		219,802		16,267			—		236,069
Medical office building services costs		—		—		4,633			—		4,633
Segment NOI		351,625		111,733		33,057			11,336		507,751
Loss from unconsolidated entities		—		—		(392	)		—		(392	)
Segment profit	$	351,625	$	111,733	$	32,665		$	11,336		507,359
Interest and other income											420
Interest expense											(133,449	)
Depreciation and amortization											(154,458	)
General, administrative and professional fees											(35,819	)
Loss on extinguishment of debt											(6,549	)
Merger-related expenses and deal costs											(11,668	)
Other											404
Income tax expense											(2,352	)
Discontinued operations											7,139
Net income										$	171,027

Assets by reportable business segment are as follows:

	As of				As of
	September 30,				December 31,
	2011				2010
	(In thousands)
Assets:
Triple-net leased properties	$	8,652,706	50.3	%	$	2,474,612	43.0	%
Senior living operations		5,807,192	33.7			2,297,041	39.9
MOB operations		2,367,480	13.8			748,945	13.0
All other assets		378,392	2.2			237,423	4.1
Total assets	$	17,205,770	100.0	%	$	5,758,021	100.0	%

Capital expenditures, including investments in real estate property and development project expenditures, by reportable business segment are as follows:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands)
Capital expenditures:
Triple-net leased properties	$	68,604	$	211	$	69,831	$	12,303
Senior living operations		20,842		3,889		296,446		6,782
MOB operations		23,432		218,307		30,301		233,315
Total capital expenditures	$	112,878	$	222,407	$	396,578	$	252,400

Our portfolio of properties and real estate loan and other investments are located in the United States and Canada. Revenues are attributed to an individual country based on the location of each property.

Geographic information regarding our operations is as follows:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
	2011		2010		2011		2010
	(In thousands)
Revenues:
United States	$	542,533	$	246,358	$	1,132,047	$	695,252
Canada		23,424		18,307		69,031		53,621
Total revenues	$	565,957	$	264,665	$	1,201,078	$	748,873

	As of		As of
	September 30,		December 31,
	2011		2010
	(In thousands)
Net real estate property:
United States	$	15,598,457	$	4,857,510
Canada		397,585		422,009
Total net real estate property	$	15,996,042	$	5,279,519

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Consolidated Statements of Equity (Parenthetical) (USD $)	9 Months Ended	12 Months Ended
	Sep. 30, 2011	Dec. 31, 2010
Dividends to common stockholders, per share	$ 1.725	$ 2.14
Total Ventas Stockholders' Equity
Dividends to common stockholders, per share	$ 1.725	$ 2.14
Retained Earnings (Deficit)
Dividends to common stockholders, per share	$ 1.725	$ 2.14

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Senior Notes Payable and Other Debt

9 Months Ended

Sep. 30, 2011

Senior Notes Payable and Other Debt [Abstract]

SENIOR NOTES PAYABLE AND OTHER DEBT

NOTE 8 — SENIOR NOTES PAYABLE AND OTHER DEBT

The following is a summary of our senior notes payable and other debt as of September 30, 2011 and December 31, 2010:

	September 30,			December 31,
	2011			2010
	(In thousands)
Unsecured revolving credit facilities	$	474,000		$	40,000
37/8% Convertible Senior Notes due 2011		230,000			230,000
9% Senior Notes due 2012		82,433			82,433
81/4% Senior Notes due 2012		72,950			—
Unsecured term loan due 2012		250,000			—
Unsecured term loan due 2013		200,000			200,000
6.25% Senior Notes due 2013		269,850			—
3.125% Senior Notes due 2015		400,000			400,000
6% Senior Notes due 2015		234,420			—
61/2% Senior Notes due 2016		200,000			400,000
63/4% Senior Notes due 2017		225,000			225,000
4.750% Senior Notes due 2021		700,000			—
6.90% Senior Notes due 2037		52,400			—
6.59% Senior Notes due 2038		22,973			—
Mortgage loans and other		2,651,830			1,349,521
Total		6,065,856			2,926,954
Capital lease obligations		143,119			—
Unamortized fair value adjustment		145,647			11,790
Unamortized commission fees and discounts		(41,481	)		(38,700	)
Senior notes payable and other debt	$	6,313,141		$	2,900,044

As of September 30, 2011, our joint venture partners’ share of total debt was $45.9 million with respect to seven properties owned through consolidated joint ventures. As of December 31, 2010, our joint venture partners’ share of total debt was $4.8 million with respect to three properties owned through consolidated joint ventures. Total debt does not include our portion of debt related to our investments in unconsolidated entities, which was $131.7 million and $45.9 million at September 30, 2011 and December 31, 2010, respectively.

As of September 30, 2011, our indebtedness (excluding capital lease obligations) had the following maturities:

			Unsecured
	Principal Amount		Revolving Credit		Scheduled Periodic
	Due at Maturity		Facilities (1)		Amortization		Total Maturities
	(In thousands)
2011	$	230,700	$	—	$	12,798	$	243,498
2012 (2)		517,913		474,000		50,347		1,042,260
2013		872,623		—		44,110		916,733
2014		220,891		—		39,998		260,889
2015		835,792		—		32,503		868,295
Thereafter (3)		2,539,451		—		194,730		2,734,181
Total maturities	$	5,217,370	$	474,000	$	374,486	$	6,065,856

(1)	At September 30, 2011, we had $57.5 million of unrestricted cash and cash equivalents, for $416.5 million of net borrowings outstanding under our unsecured revolving credit facilities. On October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new $2.0 billion unsecured revolving credit facility due 2015, subject to a one-year extension. See “Unsecured Revolving Credit Facilities and Term Loans” below.
(2)	Includes $250.0 million of borrowings outstanding under an $800.0 million senior unsecured term loan previously extended to NHP, which was repaid in full subsequent to September 30, 2011. See “Unsecured Revolving Credit Facilities and Term Loans” below.
(3)	Includes $52.4 million aggregate principal amount of 6.90% Senior Notes due 2037 of NHP, which are subject to repurchase, at the option of the holders, on October 1 of each of 2012, 2017 and 2027, and $23.0 million aggregate principal amount of 6.59% Senior Notes due 2038 of NHP, which are subject to repurchase, at the option of the holders, on July 7 of each of 2013, 2018, 2023 and 2028.

Unsecured Revolving Credit Facilities and Term Loans

As of September 30, 2011, we had $1.0 billion of aggregate borrowing capacity under our then-existing unsecured revolving credit facilities, all of which was scheduled to mature on April 26, 2012. Borrowings under our unsecured revolving credit facilities bore interest at a fluctuating rate per annum (based on U.S. or Canadian LIBOR, the Canadian Bankers’ Acceptance rate, or the U.S. or Canadian Prime rate), plus an applicable percentage based on our consolidated leverage. At September 30, 2011, the applicable percentage was 2.80%. Our unsecured revolving credit facilities also had a 20 basis point facility fee. At September 30, 2011, we had $474.0 million of borrowings outstanding, $8.3 million of outstanding letters of credit and $517.7 million of available borrowing capacity under our unsecured revolving credit facilities, and we were in compliance with all covenants under our unsecured revolving credit facilities.

Effective October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new unsecured revolving credit facility. Our new unsecured revolving credit facility provides us with $2.0 billion of aggregate borrowing capacity, which may be increased, at our option subject to the satisfaction of certain conditions, to up to $2.5 billion, and includes sublimits of (i) up to $200 million for letters of credit, (ii) up to $200 million for swingline loans, (iii) up to $250 million for loans in certain alternative currencies, and (iv) up to 50% of the facility for certain negotiated rate loans. Borrowings under our new unsecured revolving credit facility bear interest at a fluctuating rate per annum (based on the applicable LIBOR for Eurocurrency rate loans and the higher of (i) the federal funds rate plus 0.50%, (ii) the administrative agent’s prime rate and (iii) the applicable LIBOR plus 1.0% for base rate loans, plus, in each case, an applicable percentage based on our senior unsecured long-term debt ratings). At October 18, 2011, the applicable percentage was 1.25% for Eurocurrency rate loans and 0.25% for base rate loans. We also pay a facility fee ranging from 15 to 45 basis points per annum (based on our senior unsecured long-term debt ratings) on the aggregate revolving commitments under our new unsecured revolving credit facility. At October 18, 2011, the facility fee was 25 basis points. Borrowings under our new unsecured revolving credit facility mature on October 16, 2015, but may be extended, at our option subject to the satisfaction of certain conditions, for an additional period of one year.

Our new unsecured revolving credit facility imposes certain customary restrictions on us, including restrictions pertaining to: (i) liens; (ii) investments; (iii) the incurrence of additional indebtedness; (iv) mergers, sales of assets and dissolutions; (v) certain dividend, distribution and other payments; (vi) permitted businesses; (vii) transactions with affiliates; (viii) agreements limiting certain liens; and (ix) the maintenance of certain consolidated total leverage, secured debt leverage, unsecured leverage and fixed charge coverage ratios and minimum consolidated adjusted net worth, and contains customary events of default.

As of November 2, 2011, we had $727 million of borrowings outstanding, $8 million of outstanding letters of credit and $1.26 billion of available borrowing capacity under our new unsecured revolving credit facility.

In connection with the NHP acquisition, on July 1, 2011, we acquired additional liquidity from an $800.0 million senior unsecured term loan previously extended to NHP. At our option, borrowings under the term loan, which are available from time to time on a non-revolving basis, bear interest at the applicable LIBOR plus 1.50% (1.69% at September 30, 2011) or the “Alternate Base Rate” plus 0.50% (we had no base rate borrowings outstanding at September 30, 2011). We pay a facility fee of 10 basis points per annum on the unused commitments under the term loan agreement. Borrowings under the term loan mature on June 1, 2012. At September 30, 2011, we had $250.0 million of borrowings outstanding and $550.0 million of available borrowing capacity under the term loan, and we were in compliance with all covenants under the term loan. On November 1, 2011, we repaid the $250.0 million of borrowings outstanding and continue to have $550.0 million of available borrowing capacity under the term loan.

Mortgages

We assumed mortgage debt of $1.2 billion and $0.4 billion, respectively, in connection with our Atria Senior Living and NHP acquisitions.

In February 2011, we repaid in full mortgage loans outstanding in the aggregate principal amount of $307.2 million and recognized a loss on extinguishment of debt of $16.5 million in connection with this repayment in the first quarter of 2011.

Senior Notes

In May 2011, we issued and sold $700.0 million aggregate principal amount of 4.750% senior notes due 2021, at a public offering price equal to 99.132% of par for total proceeds of $693.9 million, before the underwriting discount and expenses.

In July 2011, we redeemed $200.0 million principal amount of our outstanding 6¹/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $8.7 million during the third quarter of 2011.

As a result of the NHP acquisition, we assumed $991.6 million aggregate principal amount of outstanding unsecured senior notes of NHP. On July 15, 2011, we repaid in full, at par, $339.0 million principal amount then outstanding of NHP’s 6.50% senior notes due 2011 upon maturity. The remaining NHP senior notes outstanding bear interest at fixed rates ranging from 6.00% to 8.25% per annum and have maturity dates ranging from July 1, 2012 to July 7, 2038, subject in certain cases to earlier repayment at the option of the holders.

Capital Leases

As of September 30, 2011, we leased eight seniors housing communities pursuant to arrangements that we assumed in connection with the Atria Senior Living acquisition which are accounted for as capital leases. Rent under each capital lease is subject to increase based upon changes in the Consumer Price Index or gross revenues attributable to the property, subject to certain limits, as defined in the applicable lease agreement. Pursuant to each capital lease agreement, we have a bargain option to purchase the leased property and an option to exercise renewal terms.

Future minimum lease payments required under the capital lease agreements, including amounts that would be due under purchase options, as of September 30, 2011 are as follows (in thousands):

2011	$	2,343
2012		9,446
2013		9,573
2014		9,699
2015		9,826
Thereafter		172,553
Total minimum lease payments		213,440
Less: Amount related to interest		(70,321	)
	$	143,119

Net assets held under capital leases are included in net real estate investments on our Consolidated Balance Sheets and totaled $226.9 million and $0 as of September 30, 2011 and December 31, 2010, respectively.

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Related Party Transactions (Details) (USD $) In Millions	3 Months Ended	9 Months Ended	3 Months Ended	5 Months Ended
	Sep. 30, 2011	Sep. 30, 2011	Sep. 30, 2011 Senior Living Management Fee [Member]	Sep. 30, 2011 Senior Living Management Fee [Member]
Related Party Transaction [Line Items]
Management fees related to the Atria properties			$ 7.9	$ 12.1
Related Party Transactions (Textuals) [Abstract]
Rent paid to The Irvine company	$ 0.1	$ 0.1

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Segment Information (Details 2) (USD $) In Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010
Revenue
Total revenues	$ 565,957	$ 264,665	$ 1,201,078	$ 748,873
United States [Member]
Revenue
Total revenues	542,533	246,358	1,132,047	695,252
Canada [Member]
Revenue
Total revenues	$ 23,424	$ 18,307	$ 69,031	$ 53,621

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Condensed Consolidating Information (Tables)

9 Months Ended

Sep. 30, 2011

Condensed Consolidating Information [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEET

As of September 30, 2011

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor		Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries		Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	464		$	3,388,426	$	566,852		$	12,461,886	$	—		$	16,417,628
Cash and cash equivalents		2,252			24,898		—			30,332		—			57,482
Escrow deposits and restricted cash		1,961			25,901		7,131			49,790		—			84,783
Deferred financing costs, net		2,914			725		2,298			6,487		—			12,424
Investment in and advances to affiliates		8,441,898			—		1,728,685			—		(10,170,583	)		—
Other assets		67,190			196,204		8,134			361,925		—			633,453
Total assets	$	8,516,679		$	3,636,154	$	2,313,100		$	12,910,420	$	(10,170,583	)	$	17,205,770
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	229,363		$	235,185	$	2,240,589		$	3,608,004	$	—		$	6,313,141
Intercompany loans		(211,796	)		843,546		(670,085	)		38,335		—			—
Accrued interest		(218	)		744		40,093			25,366		—			65,985
Accounts payable and other liabilities		95,091			174,086		17,867			841,662		—			1,128,706
Deferred income taxes		274,852			—		—			—		—			274,852
Total liabilities		387,292			1,253,561		1,628,464			4,513,367		—			7,782,684
Redeemable OP unitholder interests		—			—		—			92,817		—			92,817
Total equity		8,129,387			2,382,593		684,636			8,304,236		(10,170,583	)		9,330,269
Total liabilities and equity	$	8,516,679		$	3,636,154	$	2,313,100		$	12,910,420	$	(10,170,583	)	$	17,205,770

As of December 31, 2010

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Assets
Net real estate investments	$	937		$	3,244,243	$	688,158		$	1,510,776		$	—		$	5,444,114
Cash and cash equivalents		1,083			15,659		—			5,070			—			21,812
Escrow deposits and restricted cash		76			19,786		9,169			9,909			—			38,940
Deferred financing costs, net		2,691			1,961		7,961			6,920			—			19,533
Investment in and advances to affiliates		1,414,170			—		1,028,721			—			(2,442,891	)		—
Other assets		75,794			119,773		8,057			29,998			—			233,622
Total assets	$	1,494,751		$	3,401,422	$	1,742,066		$	1,562,673		$	(2,442,891	)	$	5,758,021
Liabilities and equity
Liabilities:
Senior notes payable and other debt	$	225,644		$	539,564	$	1,301,089		$	833,747		$	—		$	2,900,044
Intercompany loans		(144,897	)		586,605		(434,454	)		(7,254	)		—			—
Accrued interest		(113	)		2,704		12,852			3,853			—			19,296
Accounts payable and other liabilities		41,355			103,444		15,712			46,632			—			207,143
Deferred income taxes		241,333			—		—			—			—			241,333
Total liabilities		363,322			1,232,317		895,199			876,978			—			3,367,816
Total equity		1,131,429			2,169,105		846,867			685,695			(2,442,891	)		2,390,205
Total liabilities and equity	$	1,494,751		$	3,401,422	$	1,742,066		$	1,562,673		$	(2,442,891	)	$	5,758,021

CONDENSED CONSOLIDATING STATEMENT OF INCOME

For the Three Months Ended September 30, 2011

				Wholly
				Owned				Non-
				Subsidiary		Ventas		Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers		Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	623		$	55,453	$	71,611	$	142,190		$	—		$	269,877
Resident fees and services		—			100,885		—		175,479			—			276,364
Medical office building and other services revenues		—			8,162		—		1,109			—			9,271
Income from loans and investments		1,124			428		103		8,417			—			10,072
Equity earnings in affiliates		52,119			258		—		—			(52,377	)		—
Interest and other income		6			7		10		350			—			373
Total revenues		53,872			165,193		71,724		327,545			(52,377	)		565,957
Expenses:
Interest		392			14,241		21,952		37,171			—			73,756
Depreciation and amortization		440			34,908		8,795		116,884			—			161,027
Property-level operating expenses		—			78,415		115		130,631			—			209,161
Medical office building services costs		—			6,347		—		—			—			6,347
General, administrative and professional fees		1,194			9,074		6,427		3,929			—			20,624
Loss on extinguishment of debt		—			—		8,685		—			—			8,685
Litigation proceeds, net		(85,327	)		—		—		—			—			(85,327	)
Merger-related expenses and deal costs		47,309			674		—		21,367			—			69,350
Other		883			1,863		—		11,690			—			14,436
Total expenses		(35,109	)		145,522		45,974		321,672			—			478,059
Income from continuing operations before gain from unconsolidated entities, income taxes and noncontrolling interest		88,981			19,671		25,750		5,873			(52,377	)		87,898
Gain from unconsolidated entities		—			—		61		121			—			182
Income tax benefit		13,904			—		—		—			—			13,904
Net income		102,885			19,671		25,811		5,994			(52,377	)		101,984
Net loss attributable to noncontrolling interest, net of tax		—			—		—		(901	)		—			(901	)
Net income attributable to common stockholders	$	102,885		$	19,671	$	25,811	$	6,895		$	(52,377	)	$	102,885

For the Three Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	607		$	52,463		$	70,534		$	17,119		$	—		$	140,723
Resident fees and services		—			65,252			—			47,930			—			113,182
Medical office building and other services revenues		—			6,711			—			—			—			6,711
Income from loans and investments		1,406			755			1,853			—			—			4,014
Equity earnings in affiliates		61,077			439			—			—			(61,516	)		—
Interest and other income		18			4			21			(8	)		—			35
Total revenues		63,108			125,624			72,408			65,041			(61,516	)		264,665
Expenses:
Interest		820			18,386			13,261			13,052			—			45,519
Depreciation and amortization		412			28,889			9,296			13,507			—			52,104
Property-level operating expenses		—			46,908			134			34,965			—			82,007
Medical office building services costs		—			4,633			—			—			—			4,633
General, administrative and professional fees		203			8,311			5,575			1,189			—			15,278
Merger-related expenses and deal costs		3,573			1,569			—			—			—			5,142
Other		(477	)		60			—			(2	)		—			(419	)
Total expenses		4,531			108,756			28,266			62,711			—			204,264
Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		58,577			16,868			44,142			2,330			(61,516	)		60,401
Loss from unconsolidated entities		—			—			(392	)		—			—			(392	)
Income tax expense		(679	)		(978	)		—			—			—			(1,657	)
Income from continuing operations		57,898			15,890			43,750			2,330			(61,516	)		58,352
Discontinued operations		—			422			120			—			—			542
Net income		57,898			16,312			43,870			2,330			(61,516	)		58,894
Net income attributable to noncontrolling interest, net of tax		—			352			—			644			—			996
Net income attributable to common stockholders	$	57,898		$	15,960		$	43,870		$	1,686		$	(61,516	)	$	57,898

For the Nine Months Ended September 30, 2011

				Wholly
				Owned					Non-
				Subsidiary		Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors		Issuers			Subsidiaries			Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	1,848		$	165,454	$	212,653		$	176,648		$	—		$	556,603
Resident fees and services		—			252,803		—			340,545			—			593,348
Medical office building and other services revenues		—			24,941		—			1,109			—			26,050
Income from loans and investments		5,070			2,495		8,566			8,417			—			24,548
Equity earnings in affiliates		160,275			1,102		—			—			(161,377	)		—
Interest and other income		96			19		52			362			—			529
Total revenues		167,289			446,814		221,271			527,081			(161,377	)		1,201,078
Expenses:
Interest		(474	)		45,409		53,457			71,654			—			170,046
Depreciation and amortization		1,273			95,651		26,706			169,911			—			293,541
Property-level operating expenses		—			192,137		414			248,414			—			440,965
Medical office building services costs		—			19,837		—			—			—			19,837
General, administrative and professional fees		(5,840	)		28,101		21,625			7,124			—			51,010
Loss on extinguishment of debt		—			16,526		8,685			—			—			25,211
Litigation proceeds, net		(85,327	)		—		—			—			—			(85,327	)
Merger-related expenses and deal costs		108,509			1,730		—			21,367			—			131,606
Other		913			2,950		—			2,801			—			6,664
Total expenses		19,054			402,341		110,887			521,271			—			1,053,553
Income from continuing operations before (loss) income from unconsolidated entities, income taxes and noncontrolling interest		148,235			44,473		110,384			5,810			(161,377	)		147,525
(Loss) income from unconsolidated entities		—			—		(192	)		121			—			(71	)
Income tax benefit		23,310			—		—			—			—			23,310
Net income		171,545			44,473		110,192			5,931			(161,377	)		170,764
Net income attributable to noncontrolling interest, net of tax		—			—		—			(781	)		—			(781	)
Net income attributable to common stockholders	$	171,545		$	44,473	$	110,192		$	6,712		$	(161,377	)	$	171,545

For the Nine Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor		Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries		Elimination			Consolidated
	(In thousands)
Revenues:
Rental income	$	1,802		$	141,317		$	209,879		$	45,873	$	—		$	398,871
Resident fees and services		—			190,801			—			140,734		—			331,535
Medical office building and other services revenues		—			6,711			—			—		—			6,711
Income from loans and investments		4,247			1,635			5,454			—		—			11,336
Equity earnings in affiliates		176,659			1,307			—			—		(177,966	)		—
Interest and other income		310			40			63			7		—			420
Total revenues		183,018			341,811			215,396			186,614		(177,966	)		748,873
Expenses:
Interest		1,096			56,371			39,658			36,324		—			133,449
Depreciation and amortization		1,219			84,084			28,429			40,726		—			154,458
Property-level operating expenses		—			132,036			398			103,635		—			236,069
Medical office building services costs		—			4,633			—			—		—			4,633
General, administrative and professional fees		323			16,870			15,414			3,212		—			35,819
Loss on extinguishment of debt		—			102			6,447			—		—			6,549
Merger-related expenses and deal costs		10,041			1,617			—			10		—			11,668
Other		(435	)		31			—			—		—			(404	)
Total expenses		12,244			295,744			90,346			183,907		—			582,241
Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest		170,774			46,067			125,050			2,707		(177,966	)		166,632
Loss from unconsolidated entities		—			—			(392	)		—		—			(392	)
Income tax expense		(2,190	)		(162	)		—			—		—			(2,352	)
Income from continuing operations		168,584			45,905			124,658			2,707		(177,966	)		163,888
Discontinued operations		—			1,132			6,007			—		—			7,139
Net income		168,584			47,037			130,665			2,707		(177,966	)		171,027
Net income attributable to noncontrolling interest, net of tax		—			1,134			—			1,309		—			2,443
Net income attributable to common stockholders	$	168,584		$	45,903		$	130,665		$	1,398	$	(177,966	)	$	168,584

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Nine Months Ended September 30, 2011

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination		Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(3,510	)	$	107,282		$	180,935		$	159,194		$	—	$	443,901
Net cash (used in) provided by investing activities		(431,727	)		89,296			(500,879	)		386			—		(842,924	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		—			—			434,000			—			—		434,000
Proceeds from debt		—			—			689,374			268,379			—		957,753
Repayment of debt		—			(328,691	)		(206,500	)		(359,852	)		—		(895,043	)
Net change in intercompany debt		981,494			84,585			(1,208,212	)		142,133			—		—
Payment of deferred financing costs		—			—			(1,519	)		(379	)		—		(1,898	)
Issuance of common stock, net		299,926			—			—			—			—		299,926
Cash distribution (to) from affiliates		(491,099	)		56,767			612,898			(178,566	)		—		—
Cash distribution to common stockholders		(354,932	)		—			—			—			—		(354,932	)
Cash distribution to redeemable OP unitholders		—			—			—			(4,038	)		—		(4,038	)
Contributions from noncontrolling interest		—			—			—			2			—		2
Distributions to noncontrolling interest		—			—			—			(1,997	)		—		(1,997	)
Other		1,017			—			—			—			—		1,017
Net cash provided by (used in) financing activities		436,406			(187,339	)		320,041			(134,318	)		—		434,790
Net increase in cash and cash equivalents		1,169			9,239			97			25,262			—		35,767
Effect of foreign currency translation on cash and cash equivalents		—			—			(97	)		—			—		(97	)
Cash and cash equivalents at beginning of period		1,083			15,659			—			5,070			—		21,812
Cash and cash equivalents at end of period	$	2,252		$	24,898		$	—		$	30,332		$	—	$	57,482

For the Nine Months Ended September 30, 2010

				Wholly
				Owned						Non-
				Subsidiary			Ventas			Guarantor			Consolidated
	Ventas, Inc.			Guarantors			Issuers			Subsidiaries			Elimination		Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(864	)	$	118,174		$	179,105		$	49,704		$	—	$	346,119
Net cash used in investing activities		—			(57,096	)		(207,509	)		(3,871	)		—		(268,476	)
Cash flows from financing activities:
Net change in borrowings under revolving credit facilities		—			102,004			131,000			—			—		233,004
Proceeds from debt		—			—			200,000			1,237			—		201,237
Repayment of debt		—			(144,739	)		(178,139	)		(8,500	)		—		(331,378	)
Net change in intercompany debt		48,748			(59,452	)		10,704			—			—		—
Payment of deferred financing costs		—			(46	)		(1,826	)		—			—		(1,872	)
Cash distribution from (to) affiliates		199,706			50,104			(216,290	)		(33,520	)		—		—
Cash distribution to common stockholders		(251,921	)		—			—			—			—		(251,921	)
Contributions from noncontrolling interest		—			—			—			818			—		818
Distributions to noncontrolling interest		—			—			—			(6,633	)		—		(6,633	)
Other		5,426			—			—			—			—		5,426
Net cash provided by (used in) financing activities		1,959			(52,129	)		(54,551	)		(46,598	)		—		(151,319	)
Net increase (decrease) in cash and cash equivalents		1,095			8,949			(82,955	)		(765	)		—		(73,676	)
Effect of foreign currency translation on cash and cash equivalents		—			—			69			—			—		69
Cash and cash equivalents at beginning of period		—			7,864			82,886			16,647			—		107,397
Cash and cash equivalents at end of period	$	1,095		$	16,813		$	—		$	15,882		$	—	$	33,790

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Stockholders' Equity

9 Months Ended

Sep. 30, 2011

Stockholders' Equity [Abstract]

STOCKHOLDERS' EQUITY

NOTE 12 — STOCKHOLDERS’ EQUITY

On July 1, 2011, following approval by our stockholders, we amended our Amended and Restated Certificate of Incorporation, as previously amended, to increase the number of authorized shares of our capital stock to 610,000,000, comprised of 600,000,000 shares of common stock, par value $0.25 per share, and 10,000,000 shares of preferred stock, par value $1.00 per share.

On July 1, 2011, in connection with the NHP acquisition, we issued 99,849,106 shares of our common stock to NHP stockholders and holders of NHP equity awards (which shares had a total value of $5.4 billion based on the July 1, 2011 closing price of our common stock of $53.74 per share). We reserved 2,253,366 additional shares of our common stock for issuance in connection with equity awards and other convertible or exchangeable securities (specifically the OP Units) that we assumed in connection with the NHP acquisition.

On June 20, 2011, in connection with the NHP acquisition, our Board of Directors declared a prorated third quarter dividend on our common stock in the amount of $0.1264 per share, payable in cash to stockholders of record at the close of business on June 30, 2011. The prorated dividend of $23.8 million was paid on July 12, 2011. On August 19, 2011, our Board of Directors declared another prorated third quarter dividend on our common stock in the amount of $0.4486 per share, which was paid in cash on September 30, 2011 to stockholders of record on September 13, 2011. Together, these two prorated amounts equate to our regular quarterly dividend of $0.575 per share and constitute the third quarterly installment of our 2011 dividend.

On May 12, 2011, as partial consideration for the Atria Senior Living assets, we issued to the sellers in a private placement 24,958,543 shares of our common stock (which shares had a total value of $1.38 billion based on the May 12, 2011 closing price of our common stock of $55.33 per share). On May 19, 2011, we filed a shelf registration statement relating to the resale of those shares by the selling stockholders. Subsequent to September 30, 2011, we cancelled 83,441 shares issued to the sellers for a working capital adjustment in accordance with the purchase agreement.

In February 2011, we completed the sale of 5,563,000 shares of our common stock in an underwritten public offering pursuant to our existing shelf registration statement. We received $300.0 million in aggregate proceeds from the sale, which we used to repay existing mortgage debt and for working capital and other general corporate purposes.

Accumulated Other Comprehensive Income

The following is a summary of our accumulated other comprehensive income as of September 30, 2011 and December 31, 2010:

	September 30,			December 31,
	2011			2010
	(In thousands)
Foreign currency translation	$	18,776		$	23,010
Unrealized gain on marketable debt securities		1,830			4,794
Other		(1,369	)		(936	)
Total accumulated other comprehensive income	$	19,237		$	26,868

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Consolidated Balance Sheets (USD $) In Thousands	Sep. 30, 2011	Dec. 31, 2010
Real estate investments:
Land and improvements	$ 1,584,842	$ 559,072
Buildings and improvements	15,289,744	6,035,295
Construction in progress	60,978	6,519
Acquired lease intangibles	821,613	146,813
Total real estate investments	17,757,177	6,747,699
Accumulated depreciation and amortization	(1,761,135)	(1,468,180)
Net real estate property	15,996,042	5,279,519
Secured loans receivable, net	302,264	149,263
Investments in unconsolidated entities	119,322	15,332
Net real estate investments	16,417,628	5,444,114
Cash and cash equivalents	57,482	21,812
Escrow deposits and restricted cash	84,783	38,940
Deferred financing costs, net	12,424	19,533
Other assets	633,453	233,622
Total assets	17,205,770	5,758,021
Liabilities:
Senior notes payable and other debt	6,313,141	2,900,044
Accrued interest	65,985	19,296
Accounts payable and other liabilities	1,128,706	207,143
Deferred income taxes	274,852	241,333
Total liabilities	7,782,684	3,367,816
Redeemable OP unitholder interests	92,817	0
Commitments and Contingencies
Ventas stockholders' equity:
Preferred stock, $1.00 par value; 10,000 shares authorized, unissued
Common stock, $0.25 par value; 600,000 and 300,000 shares authorized at September 30, 2011 and December 31, 2010, respectively; 287,962 and 157,279 shares issued at September 30, 2011 and December 31, 2010, respectively	72,025	39,391
Capital in excess of par value	9,595,495	2,576,843
Accumulated other comprehensive income	19,237	26,868
Retained earnings (deficit)	(439,015)	(255,628)
Treasury stock, 37 and 14 shares at September 30, 2011 and December 31, 2010, respectively	(1,980)	(748)
Total Ventas stockholders' equity	9,245,762	2,386,726
Noncontrolling interest	84,507	3,479
Total equity	9,330,269	2,390,205
Total liabilities and equity	$ 17,205,770	$ 5,758,021

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Accounting Policies (Details) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011 Segment Property Year State Province License LeaseRenewal	Sep. 30, 2010	Dec. 31, 2010 Property Year
Accounting Policies (Textuals) [Abstract]
Straight line rent receivable	$ 95,500,000		$ 95,500,000		$ 86,300,000
Notice period to cancel lease agreements by the resident			30 days
Term of resident lease agreements, Minimum			12 months
Term of resident lease agreements, Maximum			18 months
REIT share amount	0.7866		0.7866
Fair value of operating partnership units exceeding cost	92,800,000		92,800,000
Percentage of partnership interest units held by class B unitholders	70.90%		70.90%
Maximum percentage of ownership interest can be held in Entities	100.00%		100.00%
Number of properties having controlling interests owned through joint ventures			29		6
Noncontrolling interest share in properties owned through joint ventures	84,507,000		84,507,000		3,479,000
Net income (loss) attributable to noncontrolling interest, net of tax	$ (901,000)	$ 996,000	$ (781,000)	$ 2,443,000
Class A Units [Member]
Property, Plant and Equipment [Line Items]
Limited partnership units held by third party investors	2,375,027		2,375,027
Percentage of ownership interest on total units outstanding	29.10%		29.10%
Class B Units [Member]
Property, Plant and Equipment [Line Items]
Limited partnership units outstanding	5,795,210		5,795,210

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Fair Values of Financial Instruments (Details Textuals) (USD $)	3 Months Ended	9 Months Ended
	Mar. 31, 2011	Sep. 30, 2011	Dec. 31, 2010
Fair Values of Financial Instruments (Textuals) [Abstract]
Marketable debt securities, available-for-sale, amortized cost basis		$ 41,000,000	$ 61,900,000
Marketable debt securities, available-for-sale, fair value		42,788,000	66,675,000
Contractual maturities of marketable debt securities range, low		October 1, 2012
Contractual maturities of marketable debt securities range, high		April 15, 2016
Proceeds from sale of marketable debt security	23,100,000
Gain from the sale of marketable debt security	$ 1,800,000

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Segment Information (Details) (USD $) In Thousands	3 Months Ended			9 Months Ended		12 Months Ended
	Sep. 30, 2011	Mar. 31, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010	Dec. 31, 2010
Summary information by business segment
Rental income	$ 269,877		$ 140,723	$ 556,603	$ 398,871
Resident fees and services	276,364		113,182	593,348	331,535
Medical office building and other services revenue	9,271		6,711	26,050	6,711
Income from loans and investments	10,072		4,014	24,548	11,336
Interest and other income	373		35	529	420
Total revenues	565,957		264,665	1,201,078	748,873
Property-level operating expenses	209,161		82,007	440,965	236,069
Medical office building services costs	6,347		4,633	19,837	4,633
Segment NOI	350,076		177,990	739,747	507,751
Income (loss) from unconsolidated entities	182		(392)	(71)	(392)
Segment profit	350,258		177,598	739,676	507,359
Interest expense	(73,756)		(45,519)	(170,046)	(133,449)
Depreciation and amortization	(161,027)		(52,104)	(293,541)	(154,458)
General, administrative and professional fees	(20,624)		(15,278)	(51,010)	(35,819)
Loss on extinguishment of debt	(8,685)	(16,500)		(25,211)	(6,549)
Litigation proceeds, net	(85,327)			(85,327)
Merger-related expenses and deal costs	(69,350)		(5,142)	(131,606)	(11,668)
Other	(14,436)		419	(6,664)	404
Income tax benefit (expense)	13,904		(1,657)	23,310	(2,352)
Discontinued operations			542		7,139
Net income	101,984		58,894	170,764	171,027	249,729
Triple-Net Leased Properties [Member]
Summary information by business segment
Rental income	211,479		117,906	450,211	351,625
Medical office building and other services revenue	1,109			1,109
Total revenues	212,588		117,906	451,320	351,625
Segment NOI	212,588		117,906	451,320	351,625
Income (loss) from unconsolidated entities	121			121
Segment profit	212,709		117,906	451,441	351,625
Senior Living Operations [Member]
Summary information by business segment
Resident fees and services	276,364		113,182	593,348	331,535
Total revenues	276,364		113,182	593,348	331,535
Property-level operating expenses	188,856		74,066	403,706	219,802
Segment NOI	87,508		39,116	189,642	111,733
Segment profit	87,508		39,116	189,642	111,733
MOB Operations [Member]
Summary information by business segment
Rental income	58,398		22,817	106,392	47,246
Medical office building and other services revenue	8,162		6,711	24,941	6,711
Total revenues	66,560		29,528	131,333	53,957
Property-level operating expenses	20,305		7,941	37,259	16,267
Medical office building services costs	6,347		4,633	19,837	4,633
Segment NOI	39,908		16,954	74,237	33,057
Income (loss) from unconsolidated entities	61		(392)	(192)	(392)
Segment profit	39,969		16,562	74,045	32,665
All Other [Member]
Summary information by business segment
Income from loans and investments	10,072		4,014	24,548	11,336
Interest and other income	373		35	529	420
Total revenues	10,445		4,049	25,077	11,756
Segment NOI	10,072		4,014	24,548	11,336
Segment profit	$ 10,072		$ 4,014	$ 24,548	$ 11,336

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Senior Notes Payable and Other Debt (Details 1) (USD $) In Thousands	Sep. 30, 2011		Dec. 31, 2010
Scheduled maturities of borrowing arrangements and other provisions excluding capital lease obligations [Abstract]
2011	$ 243,498
2012	1,042,260
2013	916,733
2014	260,889
2015	868,295
Thereafter	2,734,181
Total maturities	6,065,856		2,926,954
Principal Amount Due at Maturity [Member]
Scheduled maturities of borrowing arrangements and other provisions excluding capital lease obligations [Abstract]
2011	230,700
2012	517,913
2013	872,623
2014	220,891
2015	835,792
Thereafter	2,539,451
Total maturities	5,217,370
Unsecured Revolving Credit Facilities [Member]
Scheduled maturities of borrowing arrangements and other provisions excluding capital lease obligations [Abstract]
2011	0	[1]
2012	474,000	[1]
2013	0	[1]
2014	0	[1]
2015	0	[1]
Thereafter	0	[1]
Total maturities	474,000	[1]
Scheduled Periodic Amortization [Member]
Scheduled maturities of borrowing arrangements and other provisions excluding capital lease obligations [Abstract]
2011	12,798
2012	50,347
2013	44,110
2014	39,998
2015	32,503
Thereafter	194,730
Total maturities	$ 374,486

[1] At September 30, 2011, we had $57.5 million of unrestricted cash and cash equivalents, for $416.5 million of net borrowings outstanding under our unsecured revolving credit facilities. On October 18, 2011, we repaid all borrowings outstanding and terminated the commitments under our unsecured revolving credit facilities and entered into a new $2.0 billion unsecured revolving credit facility due 2015. See "Unsecured Revolving Credit Facilities and Term Loans" below.

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Senior Notes Payable and Other Debt (Details 2) (USD $) In Thousands	Sep. 30, 2011
Future minimum lease payments under the capital lease agreements
2011	$ 2,343
2012	9,446
2013	9,573
2014	9,699
2015	9,826
Thereafter	172,553
Total minimum lease payments	213,440
Less: Amount related to interest	(70,321)
Total maturities	$ 143,119

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Earnings Per Common Share (Details) (USD $) In Thousands, except Per Share data	3 Months Ended		9 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011	Sep. 30, 2010
Numerator for basic and diluted earnings per share:
Income from continuing operations attributable to common stockholders	$ 102,885	$ 57,356	$ 171,545	$ 161,445
Discontinued operations		542		7,139
Net income attributable to common stockholders	$ 102,885	$ 57,898	$ 171,545	$ 168,584
Denominator:
Denominator for basic earnings per share - weighted average shares	287,365	156,631	208,470	156,566
Effect of dilutive securities:
Stock options	412	451	458	375
OP units	1,868		630
Restricted stock awards	38	95	57	62
Convertible notes	1,111	764	1,235	450
Denominator for diluted earnings per share - adjusted weighted average shares	290,794	157,941	210,850	157,453
Basic earnings per share:
Income from continuing operations attributable to common stockholders	$ 0.36	$ 0.37	$ 0.82	$ 1.03
Discontinued operations		$ 0.00		$ 0.05
Net income attributable to common stockholders	$ 0.36	$ 0.37	$ 0.82	$ 1.08
Diluted earnings per share:
Income from continuing operations attributable to common stockholders	$ 0.35	$ 0.37	$ 0.81	$ 1.02
Discontinued operations		$ 0.00		$ 0.05
Net income attributable to common stockholders	$ 0.35	$ 0.37	$ 0.81	$ 1.07

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Concentration of Credit Risk (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended	12 Months Ended
	Sep. 30, 2011	Sep. 30, 2010	Sep. 30, 2011 Hospital Renewal Property Bundle	Apr. 30, 2012
Concentration of Credit Risk (Textuals) [Abstract]
Number of states	46		46
Revenue concentration risk percentage	10.00%		10.00%
Number of Canadian provinces	2		2
Number of states accounting for more than 10% of total revenues	1		1
Senior Housing Communities [Member]
Concentration of Credit Risk [Line Items]
Gross book value of real estate investments	66.20%		66.20%
Number of seniors housing communities under long-term management agreements	196		196
Hospitals Medical Office Building And Other [Member]
Concentration of Credit Risk [Line Items]
Gross book value of real estate investments	33.80%		33.80%
Sunrise [Member]
Concentration of Credit Risk [Line Items]
Gross book value of real estate investments managed	14.40%		14.40%
Term of agreement			30 years
Atria [Member]
Concentration of Credit Risk [Line Items]
Gross book value of real estate investments managed	18.70%		18.70%
Term of agreement			10 years
Successive automatic renewal period			10 years
Brookdale Senior Living [Member]
Concentration of Credit Risk [Line Items]
Gross book value of real estate investments managed	13.00%		13.00%
Percentage of total revenues derived by third party	8.10%	11.30%
Percentage of net operating income derived from lease agreements	13.10%	16.80%
Kindred [Member]
Concentration of Credit Risk [Line Items]
Gross book value of real estate investments managed	5.00%		5.00%
Percentage of total revenues derived by third party	11.30%	23.50%
Percentage of net operating income derived from lease agreements	18.30%	34.80%
Number of renewals during lease term			3
Term of lease renewal			5 years
Number of bundles set to expire			10
Number of triple-net properties covered by ten bundles			89
Minimum Number of properties in each bundle			6
Minimum number of hospitals in the bundle			1
Annual base rent of triple-net properties covered by ten bundles				$ 122.8
Number of assets covered by six bundles			53
Rent of assets covered by six bundles			$ 66
Number of bundles in the second renewal period			6
Kindred [Member] | Minimum [Member]
Concentration of Credit Risk [Line Items]
Term of lease			10 years
Kindred [Member] | Maximum [Member]
Concentration of Credit Risk [Line Items]
Term of lease			15 years