Equity

12 Months Ended

Dec. 31, 2012

Equity

Equity

(13) Equity

• Preferred Stock

        On April 23, 2012, the Company redeemed all of its outstanding preferred stock consisting of 4,000,000 shares of its 7.25% Series E preferred stock and the 7,820,000 shares of its 7.10% Series F preferred stock. The shares of Series E and Series F preferred stock were redeemed at a price of $25 per share, or $295.5 million in aggregate, plus all accrued and unpaid dividends to the redemption date. As a result of the redemption, which was announced on March 22, 2012, the Company incurred a charge of $10.4 million related to the original issuance costs of the preferred stock (this charge is presented as an additional preferred stock dividend in the Company's consolidated statements of income).

        Distributions with respect to the Company's preferred stock can be characterized for federal income tax purposes as taxable ordinary dividends, capital gain dividends, nondividend distributions or a combination thereof. Following is the characterization of the Company's annual preferred stock dividends per share:

	Series E						Series F
	December 31,						December 31,
	2012(1)		2011		2010		2012(1)		2011		2010
	(unaudited)
Ordinary dividends	$	0.4383	$	1.4335	$	1.6695	$	0.4292	$	1.4038	$	1.6350
Capital gain dividends		0.0148		0.3790		0.1430		0.0145		0.3712		0.1400
	$	0.4531	$	1.8125	$	1.8125	$	0.4437	$	1.7750	$	1.7750

(1)

As discussed above, the Company redeemed all of its outstanding preferred stock on April 23, 2012.

• Common Stock

        Distributions with respect to the Company's common stock can be characterized for federal income tax purposes as taxable ordinary dividends, capital gain dividends, nondividend distributions or a combination thereof. Following is the characterization of the Company's annual common stock dividends per share:

	Year Ended December 31,
	2012		2011		2010
	(unaudited)
Ordinary dividends	$	1.4618	$	0.9259	$	1.0935
Capital gain dividends		0.0495		0.2448		0.0937
Nondividend distributions		0.4887		0.7493		0.6728
	$	2.0000	$	1.9200	$	1.8600

        On January 25, 2013, the Company announced that its Board declared a quarterly cash dividend of $0.525 per share. The common stock cash dividend will be paid on February 19, 2013 to stockholders of record as of the close of business on February 4, 2013.

        On October 19, 2012, we completed a public offering of 22 million shares of common stock and received net proceeds of $979 million, which were primarily used to acquire the 129 senior housing communities from the Blackstone JV.

        In June 2012, the Company completed a $376 million offering of 8.97 million shares of common stock at a price of $41.88 per share, which were primarily used to repay $250 million of maturing senior unsecured notes, which accrued interest at a rate of 6.45%.

        In March 2012, the Company completed a $359 million offering of 9.0 million shares of common stock at a price of $39.93 per share, which were primarily used to redeem all outstanding shares of the Company's preferred stock.

        In March 2011, the Company completed a $1.273 billion public offering of 34.5 million shares of common stock at a price of $36.90 per share. The Company received total net proceeds of $1.235 billion, which were primarily used to finance part of the aggregate purchase price of the HCR ManorCare Acquisition. The following is a summary of the Company's other issuances of common stock:

	Year Ended December 31,
	2012		2011
	(shares in thousands)
Dividend Reinvestment and Stock Purchase Plan		1,064		1,910
Conversion of DownREIT units		736		80
Exercise of stock options		2,455		1,157
Vesting of restricted stock units(1)		707		228

(1)

Issued under the Company's 2006 Performance Incentive Plan.

• Accumulated Other Comprehensive Loss

        The following is a summary of the Company's accumulated other comprehensive loss (in thousands):

	December 31,
	2012			2011
Unrealized gains on available for sale securities	$	7,776		$	—
Unrealized losses on cash flow hedges, net		(18,452	)		(15,712	)
Supplemental Executive Retirement Plan minimum liability		(3,150	)		(2,794	)
Cumulative foreign currency translation adjustment		(827	)		(1,076	)
Total accumulated other comprehensive loss	$	(14,653	)	$	(19,582	)

• Noncontrolling Interests

        At December 31, 2012, there were four million non-managing member units (six million shares of HCP common stock are issuable upon conversion) outstanding in four DownREIT LLCs, in all of which the Company is the managing member. At December 31, 2012, the carrying and market values of the four million DownREIT units were $188 million and $275 million, respectively.