EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

 

NEWS RELEASE

 

HEALTH CARE PROPERTY INVESTORS, INC. REPORTS RESULTS FOR

THE QUARTER AND YEAR ENDED DECEMBER 31, 2004

 

LONG BEACH, CA, February 14, 2005 — Health Care Property Investors, Inc. (NYSE:HCP), a health care real estate investment trust (“REIT”), today announced operating results for the quarter and year ended December 31, 2004. Net income applicable to common shares for the quarter ended December 31, 2004 totaled $40.8 million, or $0.30 per diluted share of common stock. This compares with net income applicable to common shares of $41.4 million, or $0.32 per diluted share of common stock for the quarter ended December 31, 2003. Net income applicable to common shares for the full year 2004 was $147.9 million, or $1.11 per diluted share of common stock, compared to $121.8 million, or $0.97 per diluted share of common stock, in the year ago period.

 

The Company’s results for the quarter and year ended December 31, 2004 includes income of $5.7 million resulting from the Company’s change in estimate related to the collectability of straight-line rental income from affiliates of American Retirement Corporation (“ARC”). Net income for the quarter and year ended December 31, 2003 includes a $3.4 million accrual reversal related to the 1999 acquisition of American Health Properties and the full year 2003 includes preferred stock redemption charges of $18.6 million.

 

Funds From Operations (“FFO”) was $60.6 million, or $0.45 per diluted share of common stock, for the quarter ended December 31, 2004, compared to FFO of $59.9 million, or $0.46 per diluted share of common stock, for the quarter ended December 31, 2003. Prior to asset impairment charges, FFO was $0.45 and $0.47 per diluted share for the quarters ended December 31, 2004 and 2003, respectively. FFO for the year ended December 31, 2004 was $221.5 million, or $1.66 per diluted share of common stock, compared to $192.2 million, or $1.54 per diluted share of common stock in 2003. Prior to asset impairment charges of $17.1 million and $14.0 million, FFO per diluted share of common stock for the years 2004 and 2003 was $1.79 and $1.64, respectively. FFO is a supplemental non-GAAP financial measure used to evaluate the operating performance of real estate investment trusts.

HIGHLIGHTS and RECENT DEVELOPMENTS

 

  •   During the fourth quarter of 2004, the Company made investments of approximately $117 million, principally the previously announced purchase of three medical office buildings, a 42% condominium interest in a fourth medical office building, and one retail/garage building for $111 million from Swedish Medical Center in Seattle, Washington.

 

  •   Aggregate investments, including $70 million of medical office development properties placed in service, for the full year 2004 were approximately $538 million, or $438 million net of related mezzanine debt repayments. For the year ended December 31, 2004, the Company’s investments were allocated among the following sectors: 23% assisted living and continuing care retirement communities, 19% skilled nursing facilities, 49% medical office buildings, and 9% life sciences properties. The Company also sold properties valued at approximately $170 million, principally comprised of medical office buildings.

 

  •   On January 31, 2005, the Company announced that its Board of Directors declared a quarterly common stock cash dividend of $0.42 per share. The common stock dividend will be paid on February 18, 2005 to stockholders of record as of the close of business on February 7, 2005. This dividend equals $1.68 per share on an annualized basis.

 

COMPANY INFORMATION

 

Health Care Property Investors, Inc. has scheduled a conference call and webcast for Tuesday, February 15, 2005 at 9:00 a.m. Pacific Time (12:00 p.m. Eastern Time) in order to present the Company’s performance and operating results for the quarter and year ended December 31, 2004. The conference call is accessible by dialing 800-706-7745 (U.S.) and 617-614-3472 (International). The participant pass code is 34124655. The webcast is accessible via the Company’s Internet web site at www.hcpi.com. A webcast replay of the conference call will be available after 2:00 p.m. Pacific Time on February 15, 2005 through March 1, 2005 on the Company’s web site.

 

Health Care Property Investors, Inc. (NYSE:HCP) is a self-administered real estate investment trust (“REIT”) that invests directly or through joint ventures in health care facilities. As of December 31, 2004, the Company’s portfolio of properties, including investments through joint ventures and mortgage loans, included 527 properties in 43 states and consisted of 29 hospitals, 171 skilled nursing facilities, 119 assisted living and continuing care retirement communities (“CCRCs”), 184 medical office buildings and 24 other health care facilities. For more information on Health Care Property Investors, Inc., visit the Company’s web site at www.hcpi.com.

 

###

 

Contact:

 

Health Care Property Investors, Inc., Long Beach, California

 

Talya Nevo-Hacohen

Senior Vice President – Strategic Development and Treasurer

(562) 733-5104

 

Page 2 of 12

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this release and in the supplement, which are not historical facts, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Examples of such forward looking statements include the Company’s beliefs and statements regarding net income and FFO guidance for fiscal year 2005. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by forward-looking statements. These risks and uncertainties include competition for the acquisition and financing of health care facilities, competition for lessees and mortgagors (including new leases and mortgages and the renewal or roll-over of existing leases); continuing operational difficulties in the skilled nursing and assisted living sectors; the Company’s ability to acquire, sell or lease facilities and the timing of acquisitions, sales and leasings; changes in health care laws and regulations and other changes in the health care industry which affect the operations of the Company’s lessees or mortgagors; changes in management; costs of compliance with building regulations; changes in tax laws and regulations; changes in the financial position of the Company’s lessees and mortgagors; changes in rules governing financial reporting, including new accounting pronouncements; and changes in economic conditions, including changes in interest rates and the availability and cost of capital, which affect opportunities for profitable investments. Some of these risks, and other risks, are described from time to time in Health Care Property Investors’ Securities and Exchange Commission filings.

 

Page 3 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

 

Summary of Information (Unaudited)

 

In Thousands, Except Per Share Data

 

     Quarter Ended December 31,
    Year Ended December 31,
     2004
    2003
    2004
    2003

Revenues

    $ 115,449    $ 104,134    $ 428,684    $ 376,304

Net income applicable to common shares

    $ 40,848    $ 41,435    $ 147,910    $ 121,849

Basic earnings per share

    $ 0.31    $ 0.32    $ 1.12    $ 0.98

Diluted earnings per share

    $ 0.30    $ 0.32    $ 1.11    $ 0.97

Shares used to calculate diluted earnings per share

      134,308      131,020      133,362      126,130
    
  
  
  

Funds from operations (1)

    $ 60,646    $ 59,930    $ 221,514    $ 192,239

Diluted funds from operations per share (1)

    $ 0.45    $ 0.46    $ 1.66    $ 1.54
    
  
  
  

Impairments

    $ 450    $ 2,340    $ 17,067    $ 13,992

Per share impact of impairments on diluted funds from operations

    $ —      $ 0.01    $ 0.13    $ 0.10
(1) The Company believes that Funds From Operations (FFO) and Diluted Funds From Operations per share are important supplemental measures of operating performance for a real estate investment trust. Because the historical cost accounting convention used for real estate assets requires straight-line depreciation (except on land), such accounting presentation implies that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen and fallen with market conditions, presentations of operating results for a real estate investment trust that uses historical cost accounting for depreciation could be less informative. The term FFO was designed by the real estate investment trust industry to address this issue.

The Company defines FFO as net income applicable to common shares (computed in accordance with U.S. generally accepted accounting principles), excluding gains (or losses) from real estate dispositions, plus real estate depreciation and amortization, and after adjustments for joint ventures. Adjustments for joint ventures are calculated to reflect FFO on the same basis. FFO does not represent cash generated from operating activities in accordance with U.S. generally accepted accounting principles, is not necessarily indicative of cash available to fund cash needs, and should not be considered an alternative to net income. A reconciliation of net income applicable to common shares to FFO is provided herein.

 

Page 4 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

 

Consolidated Statements of Income (Unaudited)

 

In Thousands, Except Per Share Data

 

    

Quarter Ended

December 31,

    

Year Ended

December 31,

  
     2004
     2003
     2004
     2003
  

Revenues

                                 

Rental income

    $ 108,646     $ 87,117     $ 388,631     $ 324,796  

Equity in income from unconsolidated joint ventures

      530       2,435       2,157       2,889  

Interest and other income

      6,273       14,582       37,896       48,619  
    
 
 
 
       115,449       104,134       428,684       376,304  
    
 
 
 

Costs and expenses

                                 

Interest

      23,481       22,776       89,136       88,297  

Real estate depreciation and amortization

      23,497       19,450       87,026       73,345  

Operating

      13,905       10,339       43,255       32,513  

General and administrative

      10,525       8,267       36,031       24,366  

Impairments

      —         2,090       3,186       2,090  
    
 
 
 
       71,408       62,922       258,634       220,611  
    
 
 
 

Income from operations

      44,041       41,212       170,050       155,693  

Minority interests

      (3,105 )     (3,454 )     (12,204 )     (9,751 )
    
 
 
 

Income from continuing operations

      40,936       37,758       157,846       145,942  

Discontinued operations

                                 

Operating income from discontinued operations

      668       2,857       3,990       12,409  

Gain on real estate dispositions, net of impairments

      4,527       3,783       7,204       234  
    
 
 
 
       5,195       6,640       11,194       12,643  
    
 
 
 

Net income

      46,131       44,398       169,040       158,585  

Dividends to preferred stockholders

      (5,283 )     (2,963 )     (21,130 )     (18,183 )

Preferred stock redemption charges

      —         —         —         (18,553 )
    
 
 
 

Net income applicable to common shares

    $ 40,848     $ 41,435     $ 147,910     $ 121,849  
    
 
 
 

Basic earnings per share

                                 

Income from continuing operations applicable to common shares

    $ 0.27     $ 0.27     $ 1.04     $ 0.87  

Discontinued operations

      0.04       0.05       0.08       0.11  
    
 
 
 

Net Income applicable to common shares

    $ 0.31     $ 0.32     $ 1.12     $ 0.98  
    
 
 
 

Diluted earnings per share

                                 

Income from continuing operations applicable to common shares

    $ 0.27     $ 0.27     $ 1.03     $ 0.87  

Discontinued operations

      0.03       0.05       0.08       0.10  
    
 
 
 

Net Income applicable to common shares

    $ 0.30     $ 0.32     $ 1.11     $ 0.97  
    
 
 
 

Shares used to calculate earnings per share

                                 

Basic

      132,840       129,224       131,854       124,942  
    
 
 
 

Diluted

      134,308       131,020       133,362       126,130  
    
 
 
 

 

Page 5 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

 

Funds From Operations Information (Unaudited)

 

In Thousands, Except Per Share Data

 

    

Quarter Ended

December 31,

    

Year Ended

December 31,

  
     2004
     2003
     2004
     2003
  

Net income applicable to common shares

    $ 40,848     $ 41,435     $ 147,910     $ 121,849  

Real estate depreciation and amortization:

                                 

Continuing operations

      23,497       19,450       87,026       73,345  

Discontinued operations

      195       1,491       2,287       6,778  

Gain on real estate dispositions

      (4,977 )     (4,033 )     (21,085 )     (12,136 )

Joint venture FFO adjustments

      1,083       1,587       5,376       2,403  
    
 
 
 

Funds from operations (1)

    $ 60,646     $ 59,930     $ 221,514     $ 192,239  
    
 
 
 

Dividends on convertible units

    $ 2,148     $ 2,194     $ 4,342     $ 3,468  
    
 
 
 

Diluted funds from operations

    $ 62,794     $ 62,124     $ 225,856     $ 195,707  
    
 
 
 

Diluted funds from operations per share (1)

    $ 0.45     $ 0.46     $ 1.66     $ 1.54  
    
 
 
 

Shares used to calculate diluted FFO

      139,361       136,438       135,940       127,490  
    
 
 
 

Impairments

    $ 450     $ 2,340     $ 17,067     $ 13,992  

Per share impact of impairments on diluted funds from operations

    $ —       $ 0.01     $ 0.13     $ 0.10  
(1) The Company believes that Funds From Operations (FFO) and Diluted Funds From Operations per share are important supplemental measures of operating performance for a real estate investment trust. Because the historical cost accounting convention used for real estate assets requires straight-line depreciation (except on land), such accounting presentation implies that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen and fallen with market conditions, presentations of operating results for a real estate investment trust that uses historical cost accounting for depreciation could be less informative. The term FFO was designed by the real estate investment trust industry to address this issue.

 

The Company defines FFO as Net Income applicable to common shares (computed in accordance with U.S. generally accepted accounting principles), excluding gains (or losses) from real estate dispositions, plus real estate depreciation and amortization, and after adjustments for joint ventures. Adjustments for joint ventures are calculated to reflect FFO on the same basis. FFO does not represent cash generated from operating activities in accordance with U.S. generally accepted accounting principles, is not necessarily indicative of cash available to fund cash needs and should not be considered an alternative to net income.

 

Page 6 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

 

Consolidated Balance Sheet (Unaudited)

 

In Thousands

 

     December 31,
2004
     December 31,
2003
  

Assets

                 

Real estate investments:

                 

Buildings and improvements

    $ 3,025,707     $ 2,682,206  

Accumulated depreciation and amortization

      (534,573 )     (486,421 )
    
 
       2,491,134       2,195,785  

Development in progress

      25,777       64,303  

Land

      299,461       283,352  
    
 
       2,816,372       2,543,440  

Loans receivable

      139,919       184,360  

Loans to joint venture partners

      6,473       83,253  

Investments in and advances to unconsolidated joint ventures

      60,506       172,450  

Accounts receivable

      14,834       16,471  

Cash and cash equivalents

      20,555       17,768  

Other assets

      43,975       18,215  
    
 

Total assets

    $ 3,102,634     $ 3,035,957  
    
 

Liabilities and Stockholders’ Equity

                 

Bank notes payable

    $ 300,100     $ 198,000  

Senior notes payable

      1,046,690       1,050,476  

Mortgage notes payable

      139,416       158,808  

Accounts payable and accrued expenses

      59,905       55,055  

Deferred revenue

      15,300       16,080  

Minority interests in joint ventures

      21,515       12,931  

Minority interests convertible into common stock

      100,266       103,990  

Stockholders’ equity:

                 

Preferred stock

      285,173       285,173  

Common stock

      133,660       131,040  

Additional paid-in capital

      1,403,333       1,355,299  

Cumulative net income

      1,348,089       1,179,049  

Cumulative dividends

      (1,739,859 )     (1,497,727 )

Other equity

      (10,954 )     (12,217 )
    
 

Total stockholders’ equity

      1,419,442       1,440,617  
    
 

Total liabilities and stockholders’ equity

    $ 3,102,634     $ 3,035,957  
    
 

 

Page 7 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

Supplemental Financial and Operating Information (Unaudited)

 

In Thousands

 

OTHER FINANCIAL INFORMATION

 

The following summarizes certain information for the quarters and years ended December 31, 2004 and 2003:

 

     Quarter Ended
December 31,
   

Year Ended

December 31,

     2004
    2003
    2004
    2003

Capitalized interest

    $ 769    $ 746    $ 1,650    $ 1,210

Amortization of deferred financing costs

      1,562      659      3,823      2,639

Income from straight-line rents and interest

      7,794      690      11,864      2,120

Lease commissions and tenant and capital improvements

      468      1,466      3,419      6,470
     Quarter Ended
December 31,
   

Year Ended

December 31,

     2004
    2003
    2004
    2003

Rental Income:

                            

Triple net

    $ 79,710    $ 64,054    $ 280,080    $ 240,156

Medical office buildings and other

      28,936      23,063      108,551      84,640
    
  
  
  
     $ 108,646    $ 87,117    $ 388,631    $ 324,796
    
  
  
  

 

Page 8 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

Supplemental Financial and Operating Information (Unaudited)

As of December 31, 2004

Dollars and Square Feet In Thousands

 

PORTFOLIO - OVERVIEW BY INVESTMENT(1)

 

     Property
Count
    Investment(2)
    Revenues Less Operating
Expenses(12)(13)
        Amount
    %
    Amount
    %

Owned Portfolio

    401    $ 3,336,929    94    $ 348,785    95

Secured Loan Portfolio

    26      140,700    4      14,288    4

Unconsolidated Joint Ventures

    100      60,506    2      2,157    1
    
  
  
  
  

Totals

    527    $ 3,538,135    100    $ 365,230    100
    
  
  
  
  

 

PORTFOLIO - OVERVIEW BY PROPERTY TYPE(1)(4)

 

    

Property

Count

   

Beds/Units(3)(5)(6)

    Square
Ft. (3)(5)(6)
    Facility
Occupancy%(5)(6)
    Number of
States
              12/31/04
    9/30/04
   

Hospital

    29    3,466 Beds    —      56    59    16

Skilled Nursing

    171    20,469 Beds    —      82    80    33

ALF & CCRC

    119    12,950 Units    —      85    86    32

MOB

    184    —      10,065    91    91    23

Other

    24    —      1,463    100    100    7
    
                        

Totals

    527                         
    
                        

 

OPERATOR CONCENTRATION – OWNED AND SECURED LOAN PORTFOLIO

 

    

Property

Count

    Investment(2)
    Revenues Less Operating
Expenses(12)(13)
           Amount
    %

Tenet Healthcare

    8    $ 422,539    $ 52,624    14

American Retirement Corp.

    17      405,678      49,347    13

Emeritus Corporation

    37      248,852      24,098    6

Kindred Healthcare, Inc.

    20      79,554      15,995    4

HealthSouth Corporation

    9      108,432      15,242    4

Beverly Enterprises, Inc.

    19      67,804      8,902    2

Pioneer Valley Hospital

    2      68,675      8,351    2

Trilogy Healthcare

    14      80,146      8,342    2

Covenant Care

    12      57,200      7,868    2

HCA Inc.

    7      67,762      7,460    2

Other public companies

    25      239,658      27,419    7

Other operators

    257      1,631,329      151,467    42
    
  
  
  

Totals

    427    $ 3,477,629    $ 377,115    100
    
  
  
  

 

Page 9 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

Supplemental Financial and Operating Information (Unaudited)

As of December 31, 2004

Dollars and Square Feet In Thousands

 

OWNED PROPERTY PORTFOLIO - OVERVIEW BY TYPE(4)(11)

 

    

Property

Count

    Investment
   

Beds

Units

(3)(5)(6)

    Square
Feet(3)
   

Facility

Occupancy%(5)(6)

    Cash
Flow
Coverage
(5)(6)(7)
    Revenues Less
Operating
Expenses(12)(13)
                 12/31/04
    9/30/04
      

Hospital

    27    $ 729,957    3,352    —      56    60    1.7    $ 92,768

Skilled Nursing

    157      656,454    18,548    —      82    80    1.3      81,890

ALF & CCRC

    103      905,643    11,124    —      85    86    1.1      83,454

MOB

    90      830,905    —      4,729    94    92    —        69,471

Other

    24      213,970    —      1,463    100    100    —        21,202
    
  
                           

Totals

    401    $ 3,336,929                             $ 348,785
    
  
                           

 

OWNED PROPERTY PORTFOLIO - OVERVIEW BY STATE(4)

 

     Hospital
    Skilled
Nursing
    ALF & CCRC
    MOB
    Other
    Total

State

    No.
    Beds
(3)(5)(6)
    No.
    Beds
(3)(5)(6)
    No.
    Units
(3)(5)(6)
    No.
    Square
Ft.(3)(5)(6)
    No.
    Square
Ft.(3)(5)(6)
    No.

TX

    4    326    9    1,079    25    2,539    10    905    —      —      48

IN

    —      —      32    3,716    3    205    13    393    —      —      48

CA

    4    828    12    1,162    8    629    11    607    3    420    38

FL

    2    312    8    930    17    2,473    4    138    —      —      31

UT

    1    139    1    120    —      —      21    897    8    510    31

TN

    —      —      13    1,981    1    60    4    410    2    101    20

OH

    —      —      12    1,543    3    375    1    37    —      —      16

AZ

    2    94    3    286    4    554    7    301    —      —      16

WA

    —      —      2    252    3    320    6    103    —      —      11

VA

    —      —      9    934    1    90    1    87    —      —      11

NC

    1    355    7    862    2    130    —      —      —      —      10

Other

    13    1,298    49    5,683    36    3,749    12    851    11    432    121
    
  
  
  
  
  
  
  
  
  
  

Totals

    27    3,352    157    18,548    103    11,124    90    4,729    24    1,463    401
    
  
  
  
  
  
  
  
  
  
  

 

OWNED PROPERTY PORTFOLIO - SAME-PROPERTY GROWTH(11)

 

     Number of
Properties
   

Revenues Less
Operating Expenses

% Change (9)

  

Owned properties, excluding MOBs

    272    0.3  

Medical office buildings

    71    (0.2 )

 

Page 10 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

Supplemental Financial and Operating Information (Unaudited)

As of December 31, 2004

Dollars and Square Feet In Thousands

 

SECURED LOAN PORTFOLIO - OVERVIEW BY PROPERTY TYPE

 

    

Property

Count

    Investment(2)
   

Beds/

Units(3)(4)

   

Facility

Occupancy %(4)

   

Debt
Service

Coverage

(4)(7)

    Revenues (13)
              12/31/04
    9/30/04
      

Hospital

    2    $ 57,667    114 Beds    68    69    3.2    $ 6,038

Skilled Nursing

    14      54,081    1,921 Beds    77    76    1.9      6,157

ALF & CCRC

    10      28,952    703 Units    82    80    1.2      2,093
    
  
                      

Totals

    26    $ 140,700                        $ 14,288
    
  
                      

 

SECURED LOAN PORTFOLIO - OVERVIEW BY STATE

 

     Hospital
    Skilled Nursing
    ALF & CCRC
    Total

State

    No.
    Investment
    No.
    Investment
    No.
    Investment
    No.
    Investment

TX

    1    $ 35,950    —      $ —      2    $ 3,171    3    $ 39,121

NC

    —        —      3      12,040    1      3,442    4      15,482

CO

    —        —      2      15,712    —        —      2      15,712

WI

    —        —      1      6,577    1      743    2      7,320

TN

    —        —      —        —      2      6,816    2      6,816

GA

    —        —      2      4,494    2      1,168    4      5,662

IN

    —        —      1      4,217    —        —      1      4,217

Other

    1      21,717    5      11,041    2      13,612    8      46,370
    
  
  
  
  
  
  
  

Totals

    2    $ 57,667    14    $ 54,081    10    $ 28,952    26    $ 140,700
    
  
  
  
  
  
  
  

 

Page 11 of 12

HEALTH CARE PROPERTY INVESTORS, INC.

Supplemental Financial and Operating Information (Unaudited)

As of December 31, 2004

Dollars and Square Feet In Thousands

 

UNCONSOLIDATED JOINT VENTURES(4)

 

    

Property

Count

    Property Type
    Investment(2)
    Beds/
Units
(3)(5)(6)
    Square
Feet
(3)(5)(6)
    Occupancy %(5)(6)
   

Number
of

States

                    12/31/04
    9/30/04
   

HCP MOP LLC(8)

    94    MOB    $ 53,710    —      5,336    88    88    14

Other

    6    Various      6,796    1,123    —      78    79    4
    
       
                        

Totals

    100         $ 60,506                         
    
       
                        
(1) Excludes sold assets, assets held for sale and unsecured loans.
(2) Investment represents the historical cost of the Company’s real estate investments and the net book value of our unconsolidated joint ventures and secured loans receivable.
(3) Hospitals and skilled nursing facilities are measured by bed count. Assisted living facilities and CCRCs are apartment-like facilities and are stated in units (studio, 1 or 2 bedroom apartments). Medical office buildings and other health care facilities are measured in square feet.
(4) Information for the Company’s hospitals, skilled nursing facilities and assisted living facilities and CCRCs was derived solely from information provided by the tenants and mortgagors without verification of its accuracy.
(5) Excludes facilities under development.
(6) Excludes newly completed facilities under start-up, vacant facilities and facilities when data is not available or meaningful.
(7) Results are for a twelve-month historical period and include impact of management fee of 2% for hospitals and 5% for skilled nursing facilities, assisted living and CCRCs.
(8) The Company is the managing member of HCP Medical Office Portfolio, LLC, an unconsolidated joint venture, and has a 33% interest therein.
(9) Same property growth reflects comparable facilities for the twelve months ended December 31, 2004 versus December 31, 2003 and excludes the effect of ARC straight-line rent revision in the fourth quarter of 2004.
(10) Revenue excludes non-property specific revenue, equity income from unconsolidated joint ventures and revenue from assets held for sale.
(11) Excludes sold assets and assets held for sale.
(12) Operating expenses exclude depreciation and amortization.
(13) Includes revenue on investments at December 31, 2004.

 

Page 12 of 12