Debt

12 Months Ended

Dec. 31, 2020

Bank Line of Credit and Term Loans

On May 23, 2019, the Company executed a $2.5 billion unsecured revolving line of credit facility (the “Revolving Facility”), which matures on May 23, 2023 and contains two six month extension options, subject to certain customary conditions. Borrowings under the Revolving Facility accrue interest at LIBOR plus a margin that depends on credit ratings of the Company's senior unsecured long-term debt. The Company pays a facility fee on the entire revolving commitment that depends on its credit ratings. Based on those credit ratings at December 31, 2020, the margin on the Revolving Facility was 0.83% and the facility fee was 0.15%.

In May 2019, the Company also entered into a $250 million unsecured term loan facility, which the Company fully drew down during the second quarter of 2019 (the “2019 Term Loan” and, together with the Revolving Facility, the “Facilities”). The 2019 Term Loan matures on May 23, 2024. Based on credit ratings for the Company’s senior unsecured long-term debt at December 31, 2020, the 2019 Term Loan accrues interest at a rate of LIBOR plus 0.90%, with a weighted average effective interest rate of 1.14%.

The Facilities include a feature that allows the Company to increase the borrowing capacity by an aggregate amount of up to $750 million, subject to securing additional commitments. The Facilities also contain certain financial restrictions and other customary requirements, including cross-default provisions to other indebtedness. Among other things, these covenants, using terms defined in the agreements: (i) limit the ratio of Enterprise Total Indebtedness to Enterprise Gross Asset Value to 60%; (ii) limit the ratio of Enterprise Secured Debt to Enterprise Gross Asset Value to 40%; (iii) limit the ratio of Enterprise Unsecured Debt to Enterprise Unencumbered Asset Value to 60%; (iv) require a minimum Fixed Charge Coverage ratio of 1.5 times; and (v) require a minimum Consolidated Tangible Net Worth of $7.0 billion. At December 31, 2020, the Company believes it was in compliance with each of these restrictions and requirements of the Facilities.

Commercial Paper Program

In September 2019, the Company established an unsecured commercial paper program (the “Commercial Paper Program”). Under the terms of the Commercial Paper Program, the Company may issue, from time to time, unsecured short-term debt securities with varying maturities. Amounts available under the Commercial Paper Program may be borrowed, repaid, and re-borrowed from time to time, with the maximum aggregate face or principal amount outstanding at any one time not exceeding $1.0 billion. Amounts borrowed under the Commercial Paper Program will be sold on terms that are customary for the U.S. commercial paper market and will be at least equal in right of payment with all of the Company’s other unsecured and unsubordinated indebtedness. The Company intends to use its Revolving Facility as a liquidity backstop for the repayment of unsecured short term debt securities issued under the Commercial Paper Program. At December 31, 2020, the Company had $130 million of notes outstanding under the Commercial Paper Program, with original maturities of one month and a weighted average interest rate of 0.30%. At December 31, 2019, the Company had $93 million of notes outstanding under the Commercial Paper Program, with original maturities of one month and a weighted average interest rate of 2.04%.

Senior Unsecured Notes

At December 31, 2020, the Company had senior unsecured notes outstanding with an aggregate principal balance of $5.75 billion. The senior unsecured notes contain certain covenants including limitations on debt, maintenance of unencumbered assets, cross-acceleration provisions, and other customary terms. The Company believes it was in compliance with these covenants at December 31, 2020.

The following table summarizes the Company’s senior unsecured notes issuances for the periods presented (dollars in thousands):


Issue Date	Amount		Coupon Rate		Maturity Date
Year ended December 31, 2020:
June 23, 2020	$	600,000	2.88	%	2031
Year ended December 31, 2019:
November 21, 2019	$	750,000	3.00	%	2030
July 5, 2019	$	650,000	3.25	%	2026
July 5, 2019	$	650,000	3.50	%	2029

There were no senior unsecured notes issuances for the year ended December 31, 2018.

The following table summarizes the Company’s senior unsecured notes payoffs and repurchases for the periods presented (dollars in thousands):


Payoff Date	Amount		Coupon Rate		Maturity Date
Year ended December 31, 2020:
July 9, 2020(1)	$	300,000	3.15	%	2022
June 24, 2020(2)	$	250,000	4.25	%	2023
Year ended December 31, 2019:
November 21, 2019(3)	$	350,000	4.00	%	2022
July 22, 2019(4)	$	800,000	2.63	%	2020
July 8, 2019(4)	$	250,000	4.00	%	2022
July 8, 2019(4)	$	250,000	4.25	%	2023
Year ended December 31, 2018:
November 8, 2018	$	450,000	3.75	%	2019
July 16, 2018(5)	$	700,000	5.38	%	2021

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(1)Upon completing the redemption of the 3.15% senior unsecured notes due in 2022, the Company recognized an $18 million loss on debt extinguishment.

(2)Upon repurchasing a portion of the 4.25% senior unsecured notes due in 2023, the Company recognized a $26 million loss on debt extinguishment.

(3)Upon repurchasing the 4.00% senior unsecured notes due in 2022, the Company recognized a $22 million loss on debt extinguishment.

(4)Upon completing the redemption of the 2.63% senior unsecured notes due in 2020 and repurchasing a portion of the 4.25% senior unsecured notes due in 2023 and the 4.00% senior unsecured notes due in 2022, the Company recognized a $35 million loss on debt extinguishment.

(5)Upon repurchasing the 5.38% senior unsecured notes due in 2021, the Company recognized a $44 million loss on debt extinguishment.

From January 1, 2021 through February 8, 2021, the Company repurchased $112 million aggregate principal amount of its 4.25% senior unsecured notes due in 2023, $201 million aggregate principal amount of its 4.20% senior unsecured notes due in 2024, and $469 million aggregate principal amount of its 3.88% senior unsecured notes due in 2024. Upon completing that repayment, the Company will recognize a $90 million loss on debt extinguishment during the first quarter of 2021.

Mortgage Debt

At December 31, 2020 and 2019, the Company had $217 million and $12 million, respectively, in aggregate principal of mortgage debt outstanding (excluding mortgage debt on assets held for sale and discontinued operations), which is secured by six and four healthcare facilities, respectively, with an aggregate carrying value of $517 million and $38 million, respectively.

During the year ended December 31, 2020, 2019, and 2018 the Company made aggregate principal repayments of mortgage debt of $18 million, $4 million, and $5 million, respectively.

Mortgage debt generally requires monthly principal and interest payments, is collateralized by real estate assets, and is generally non-recourse. Mortgage debt typically restricts the transfer of the encumbered assets, prohibits additional liens, restricts prepayment, requires payment of real estate taxes, requires maintenance of the assets in good condition, requires insurance on the assets, and includes conditions to obtain lender consent to enter into or terminate material leases. Some of the mortgage debt may require tenants or operators to maintain compliance with the applicable leases or operating agreements of such real estate assets.

In November 2020, upon consolidating one property as part of a joint venture dissolution, the Company assumed $36 million of secured mortgage debt (classified as liabilities related to assets held for sale and discontinued operations, net) maturing in 2025 and having a weighted averaged interest rate of 3.87% (see Note 4).

In May 2019, upon acquiring three senior housing assets from Oakmont, the Company assumed $50 million of secured mortgage debt (classified as liabilities related to assets held for sale and discontinued operations, net) maturing in 2028 and having a weighted average interest rate of 4.83%. In July 2019, upon acquiring five additional senior housing assets from Oakmont, the Company assumed an additional $112 million of secured mortgage debt with maturity dates ranging from 2027 to 2033 and a weighted average interest rate of 4.89% (see Note 4).

Debt Maturities

The following table summarizes the Company’s stated debt maturities and scheduled principal repayments at December 31, 2020 (in thousands):


							Senior Unsecured Notes(1)				Mortgage Debt(2)
Year	Bank Line of Credit		Commercial Paper		Term Loan		Amount		Interest Rate		Amount		Interest Rate		Total
2021	$	—	$	129,590	$	—	$	—	—	%	$	13,015	5.26	%	$	142,605
2022	—		—		—		—		—	%	4,843		—	%	4,843
2023	—		—		—		300,000		4.37	%	89,874		3.80	%	389,874
2024	—		—		250,000		1,150,000		4.17	%	3,050		—	%	1,403,050
2025	—		—		—		1,350,000		3.93	%	3,209		—	%	1,353,209
Thereafter	—		—		—		2,950,000		3.67	%	102,789		3.57	%	3,052,789
	—		129,590		250,000		5,750,000				216,780				6,346,370
(Discounts), premium and debt costs, net	—		—		(818)		(52,414)				4,841				(48,391)
	—		129,590		249,182		5,697,586				221,621				6,297,979
Debt on assets held for sale and discontinued operations(3)	—		—		—		—				318,876				318,876
	$	—	$	129,590	$	249,182	$	5,697,586			$	540,497			$	6,616,855

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(1)Effective interest rates on the senior notes range from 3.08% to 6.87% with a weighted average effective interest rate of 3.86% and a weighted average maturity of 7 years.

(2)Excluding mortgage debt on assets classified as held for sale and discontinued operations, effective interest rates on the mortgage debt range from 3.42% to 5.91% with a weighted average effective interest rate of 3.73% and a weighted average maturity of 5 years.

(3)Represents mortgage debt on assets held for sale and discontinued operations with interest rates of 1.34% to 5.13% that mature between 2025 and 2044.