Earnings Per Common Share

9 Months Ended

Sep. 30, 2023

Basic income (loss) per common share (“EPS”) is computed based on the weighted average number of common shares outstanding. Diluted income (loss) per common share is computed based on the weighted average number of common shares outstanding plus the impact of forward equity sales agreements using the treasury stock method, common shares issuable from the assumed conversion of DownREIT units, stock options, certain performance restricted stock units, and unvested restricted stock units. Only those instruments having a dilutive impact on the Company’s basic income (loss) per share are included in diluted income (loss) per share during the periods presented.

Certain restricted stock units are considered participating securities, because dividend payments are not forfeited even if the underlying award does not vest, and require use of the two-class method when computing basic and diluted earnings per share.

Refer to Note 11 for a discussion of the sale of shares under and settlement of forward sales agreements during the periods presented. The Company considered the potential dilution resulting from forward agreements under its ATM Programs to the calculation of earnings per share. At inception, the agreements do not have an effect on the computation of basic EPS as no shares are delivered until settlement. However, the Company uses the treasury stock method to calculate the dilution, if any, resulting from the forward sales agreements during the period of time prior to settlement.

The following table illustrates the computation of basic and diluted earnings per share (in thousands, except per share amounts):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Numerator - Basic
Income (loss) from continuing operations	$	68,656	$	359,284	$	259,362	$	503,611
Noncontrolling interests’ share in continuing operations	(4,442)		(4,016)		(24,297)		(11,701)
Income (loss) from continuing operations attributable to Healthpeak Properties, Inc.	64,214		355,268		235,065		491,910
Less: Participating securities’ share in continuing operations	(166)		(604)		(1,568)		(2,523)
Income (loss) from continuing operations applicable to common shares	64,048		354,664		233,497		489,387
Income (loss) from discontinued operations	—		(1,298)		—		2,011

Net income (loss) applicable to common shares	$	64,048	$	353,366	$	233,497	$	491,398
Numerator - Dilutive
Net income (loss) applicable to common shares	$	64,048	$	353,366	$	233,497	$	491,398
Add: distributions on dilutive convertible units and other	—		2,355		—		4,943
Dilutive net income (loss) available to common shares	$	64,048	$	355,721	$	233,497	$	496,341
Denominator
Basic weighted average shares outstanding	547,062		538,417		546,978		539,105
Dilutive potential common shares - equity awards(1)	269		281		269		255

Dilutive potential common shares - DownREIT conversions	—		7,317		—		5,492
Diluted weighted average common shares	547,331		546,015		547,247		544,852
Basic earnings (loss) per common share
Continuing operations	$	0.12	$	0.66	$	0.43	$	0.91
Discontinued operations	—		0.00		—		0.00
Net income (loss) applicable to common shares	$	0.12	$	0.66	$	0.43	$	0.91
Diluted earnings (loss) per common share
Continuing operations	$	0.12	$	0.65	$	0.43	$	0.91
Discontinued operations	—		0.00		—		0.00
Net income (loss) applicable to common shares	$	0.12	$	0.65	$	0.43	$	0.91

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(1)For all periods presented, represents the dilutive impact of 1 million outstanding equity awards (restricted stock units and stock options).

For the three and nine months ended September 30, 2023, forward equity sales agreements had no dilutive impact as no shares were outstanding under ATM forward contracts during the period. For the three and nine months ended September 30, 2022, the 9.1 million shares under forward equity sales agreements that had not been settled during the periods then ended were anti-dilutive.

For the three and nine months ended September 30, 2023, all 7 million shares issuable upon conversion of DownREIT units were not included because they were anti-dilutive. For the three and nine months ended September 30, 2022, 7 million and 5 million shares issuable upon conversion of DownREIT units, respectively, were dilutive and are presented as diluted potential common shares in the table above.