Segment Disclosures

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

Segment Disclosures

Segment Disclosures

The Company’s reportable segments, based on how its CODM evaluates the business and allocates resources, are as follows: (i) lab, (ii) outpatient medical, and (iii) CCRC. The Company has non-reportable segments that are comprised primarily of the Company’s interests in an unconsolidated JV that owns 19 senior housing assets (the “SWF SH JV”), loans receivable, and marketable debt securities. These marketable debt securities matured on December 31, 2022, and the Company received the related proceeds in January 2023. Non-reportable segments have been presented on an aggregate basis within the Notes to the Consolidated Financial Statements herein. The accounting policies of the segments are the same as those described in the Company’s Summary of Significant Accounting Policies (see Note 2).

During the second quarter of 2023, the Company changed the name of its “life science” and “medical office” segments to “lab” and “outpatient medical,” respectively. The segment name changes did not result in any changes to the composition of the Company’s segments or information reviewed by its CODM, and therefore, had no impact on the Company’s historical results of segment operations.

The Company evaluates performance based on property Adjusted NOI. NOI is defined as real estate revenues (inclusive of rental and related revenues, resident fees and services, income from direct financing leases, and government grant income and exclusive of interest income), less property level operating expenses; NOI excludes all other financial statement amounts included in net income (loss). Adjusted NOI is calculated as NOI after eliminating the effects of straight-line rents, DFL non-cash interest, amortization of market lease intangibles, termination fees, actuarial reserves for insurance claims that have been incurred but not reported, and the impact of deferred community fee income and expense.

NOI and Adjusted NOI are non-GAAP supplemental measures that are calculated as NOI and Adjusted NOI from consolidated properties, plus the Company’s share of NOI and Adjusted NOI from unconsolidated joint ventures (calculated by applying the Company’s actual ownership percentage for the period), less noncontrolling interests’ share of NOI and Adjusted NOI from consolidated joint ventures (calculated by applying the Company’s actual ownership percentage for the period). Management utilizes its share of NOI and Adjusted NOI in assessing its performance as the Company has various joint ventures that contribute to its performance. The Company does not control its unconsolidated joint ventures, and the Company’s share of amounts from unconsolidated joint ventures do not represent the Company’s legal claim to such items. The Company’s share of NOI and Adjusted NOI should not be considered a substitute for, and should only be considered together with and as a supplement to, the Company’s financial information presented in accordance with GAAP. Management believes that Adjusted NOI is an important supplemental measure because it provides relevant and useful information by reflecting only income and operating expense items that are incurred at the property level and presenting it on an unlevered basis. Additionally, management believes that net income (loss) is the most directly comparable GAAP measure to NOI and Adjusted NOI. NOI and Adjusted NOI should not be viewed as alternative measures of operating performance to net income (loss) as defined by GAAP since they do not reflect various excluded items.

Non-segment assets consist of assets in the Company’s other non-reportable segments and corporate non-segment assets. Corporate non-segment assets consist primarily of corporate assets, including cash and cash equivalents, restricted cash, accounts receivable, loans receivable, marketable debt securities, other assets, real estate assets held for sale, and liabilities related to assets held for sale.

The following tables summarize information for the reportable segments (in thousands):

For the year ended December 31, 2023:

	Lab		Outpatient Medical		CCRC		Other Non-reportable		Corporate Non-segment		Total
Total revenues	$	878,326	$	753,479	$	527,417	$	21,781	$	—	$	2,181,003
Government grant income(1)	—		—		184		—		—		184
Less: Interest income	—		—		—		(21,781)		—		(21,781)
Healthpeak’s share of unconsolidated joint venture total revenues	9,924		3,033		—		82,426		—		95,383
Healthpeak’s share of unconsolidated joint venture government grant income	—		—		—		229		—		229
Noncontrolling interests’ share of consolidated joint venture total revenues	(619)		(35,073)		—		—		—		(35,692)
Operating expenses	(229,630)		(263,132)		(413,472)		—		4,174		(902,060)
Healthpeak’s share of unconsolidated joint venture operating expenses	(4,092)		(1,189)		—		(60,811)		—		(66,092)
Noncontrolling interests’ share of consolidated joint venture operating expenses	156		9,921		—		—		—		10,077
Adjustments to NOI(2)	(36,524)		(14,314)		(1,618)		366		(4,174)		(56,264)
Adjusted NOI	617,541		452,725		112,511		22,210		—		1,204,987
Plus: Adjustments to NOI(2)	36,524		14,314		1,618		(366)		4,174		56,264
Interest income	—		—		—		21,781		—		21,781
Interest expense	—		(7,770)		(7,010)		—		(185,551)		(200,331)
Depreciation and amortization	(328,349)		(289,683)		(131,869)		—		—		(749,901)
General and administrative	—		—		—		—		(95,132)		(95,132)
Transaction and merger-related costs	(333)		(1,120)		(1,881)		—		(14,181)		(17,515)
Impairments and loan loss reserves, net	—		—		—		5,601		—		5,601
Gain (loss) on sales of real estate, net	60,498		21,312		—		4,653		—		86,463
Other income (expense), net	7		2,697		228		(81)		3,957		6,808
Less: Government grant income	—		—		(184)		—		—		(184)
Less: Healthpeak’s share of unconsolidated joint venture NOI	(5,832)		(1,844)		—		(21,844)		—		(29,520)
Plus: Noncontrolling interests’ share of consolidated joint venture NOI	463		25,152		—		—		—		25,615
Income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures	380,519		215,783		(26,587)		31,954		(286,733)		314,936
Income tax benefit (expense)	—		—		—		—		9,617		9,617
Equity income (loss) from unconsolidated joint ventures	4,540		835		—		4,829		—		10,204
Income (loss) from continuing operations	385,059		216,618		(26,587)		36,783		(277,116)		334,757
Income (loss) from discontinued operations	—		—		—		—		—		—
Net income (loss)	$	385,059	$	216,618	$	(26,587)	$	36,783	$	(277,116)	$	334,757

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(1)Represents government grant income received under the CARES Act, which is recorded in other income (expense), net in the Consolidated Statements of Operations (see Note 2).

(2)Represents straight-line rents, DFL non-cash interest, amortization of market lease intangibles, net, actuarial reserves for insurance claims that have been incurred but not reported, deferral of community fees, and termination fees. Includes the Company’s share of income (loss) generated by unconsolidated joint ventures and excludes noncontrolling interests’ share of income (loss) generated by consolidated joint ventures.

For the year ended December 31, 2022:

	Lab		Outpatient Medical		CCRC		Other Non-reportable		Corporate Non-segment		Total
Total revenues	$	817,573	$	725,370	$	494,935	$	23,300	$	—	$	2,061,178
Government grant income(1)	—		—		6,765		—		—		6,765
Less: Interest income	—		—		—		(23,300)		—		(23,300)
Healthpeak’s share of unconsolidated joint venture total revenues	9,921		2,999		—		73,885		—		86,805
Healthpeak’s share of unconsolidated joint venture government grant income	—		—		380		498		—		878
Noncontrolling interests’ share of consolidated joint venture total revenues	(268)		(35,717)		—		—		—		(35,985)
Operating expenses	(209,143)		(253,309)		(400,539)		—		—		(862,991)
Healthpeak’s share of unconsolidated joint venture operating expenses	(2,883)		(1,178)		—		(57,632)		—		(61,693)
Noncontrolling interests’ share of consolidated joint venture operating expenses	87		10,317		—		—		—		10,404
Adjustments to NOI(2)	(62,754)		(15,513)		2,300		169		—		(75,798)
Adjusted NOI	552,533		432,969		103,841		16,920		—		1,106,263
Plus: Adjustments to NOI(2)	62,754		15,513		(2,300)		(169)		—		75,798
Interest income	—		—		—		23,300		—		23,300
Interest expense	—		(6,900)		(7,509)		—		(158,535)		(172,944)
Depreciation and amortization	(302,649)		(279,546)		(128,374)		—		—		(710,569)
General and administrative	—		—		—		—		(131,033)		(131,033)
Transaction and merger-related costs	(387)		(1,255)		(725)		—		(2,486)		(4,853)
Impairments and loan loss reserves, net	—		—		—		(7,004)		—		(7,004)
Gain (loss) on sales of real estate, net	3,744		10,659		—		(5,325)		—		9,078
Other income (expense), net	311,939		12,709		(1,380)		(13)		3,013		326,268
Less: Government grant income	—		—		(6,765)		—		—		(6,765)
Less: Healthpeak’s share of unconsolidated joint venture NOI	(7,038)		(1,821)		(380)		(16,751)		—		(25,990)
Plus: Noncontrolling interests’ share of consolidated joint venture NOI	181		25,400		—		—		—		25,581
Income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures	621,077		207,728		(43,592)		10,958		(289,041)		507,130
Income tax benefit (expense)	—		—		—		—		4,425		4,425
Equity income (loss) from unconsolidated joint ventures	(972)		852		539		1,566		—		1,985
Income (loss) from continuing operations	620,105		208,580		(43,053)		12,524		(284,616)		513,540
Income (loss) from discontinued operations	—		—		—		—		2,884		2,884
Net income (loss)	$	620,105	$	208,580	$	(43,053)	$	12,524	$	(281,732)	$	516,424

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(1)Represents government grant income received under the CARES Act, which is recorded in other income (expense), net in the Consolidated Statements of Operations (see Note 2).

(2)Represents straight-line rents, DFL non-cash interest, amortization of market lease intangibles, net, actuarial reserves for insurance claims that have been incurred but not reported, deferral of community fees, and termination fees. Includes the Company’s share of income (loss) generated by unconsolidated joint ventures and excludes noncontrolling interests’ share of income (loss) generated by consolidated joint ventures.

For the year ended December 31, 2021:

	Lab		Outpatient Medical		CCRC		Other Non-reportable		Corporate Non-segment		Total
Total revenues	$	715,844	$	671,242	$	471,325	$	37,773	$	—	$	1,896,184
Government grant income(1)	—		—		1,412		—		—		1,412
Less: Interest income	—		—		—		(37,773)		—		(37,773)
Healthpeak’s share of unconsolidated joint venture total revenues	5,757		2,882		6,903		67,835		—		83,377
Healthpeak’s share of unconsolidated joint venture government grant income	—		—		200		1,549		—		1,749
Noncontrolling interests’ share of consolidated joint venture total revenues	(292)		(35,363)		—		—		—		(35,655)
Operating expenses	(169,044)		(223,383)		(380,865)		13		—		(773,279)
Healthpeak’s share of unconsolidated joint venture operating expenses	(1,836)		(1,174)		(6,639)		(51,866)		—		(61,515)
Noncontrolling interests’ share of consolidated joint venture operating expenses	87		10,071		—		—		—		10,158
Adjustments to NOI(2)	(46,589)		(11,118)		3,241		(47)		—		(54,513)
Adjusted NOI	503,927		413,157		95,577		17,484		—		1,030,145
Plus: Adjustments to NOI(2)	46,589		11,118		(3,241)		47		—		54,513
Interest income	—		—		—		37,773		—		37,773
Interest expense	(232)		(2,837)		(7,701)		—		(147,210)		(157,980)
Depreciation and amortization	(303,196)		(255,746)		(125,344)		—		—		(684,286)
General and administrative	—		—		—		—		(98,303)		(98,303)
Transaction and merger-related costs	(24)		(323)		(1,445)		(49)		—		(1,841)
Impairments and loan loss reserves, net	—		(21,577)		—		(1,583)		—		(23,160)
Gain (loss) on sales of real estate, net	—		190,590		—		—		—		190,590
Gain (loss) on debt extinguishments	—		—		—		—		(225,824)		(225,824)
Other income (expense), net	55		(2,725)		2,141		486		6,309		6,266
Less: Government grant income	—		—		(1,412)		—		—		(1,412)
Less: Healthpeak’s share of unconsolidated joint venture NOI	(3,921)		(1,708)		(464)		(17,518)		—		(23,611)
Plus: Noncontrolling interests’ share of consolidated joint venture NOI	205		25,292		—		—		—		25,497
Income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures	243,403		355,241		(41,889)		36,640		(465,028)		128,367
Income tax benefit (expense)	—		—		—		—		3,261		3,261
Equity income (loss) from unconsolidated joint ventures	1,118		794		1,484		2,704		—		6,100
Income (loss) from continuing operations	244,521		356,035		(40,405)		39,344		(461,767)		137,728
Income (loss) from discontinued operations	—		—		—		—		388,202		388,202
Net income (loss)	$	244,521	$	356,035	$	(40,405)	$	39,344	$	(73,565)	$	525,930

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(1)Represents government grant income received under the CARES Act, which is recorded in other income (expense), net in the Consolidated Statements of Operations (see Note 2).

(2)Represents straight-line rents, DFL non-cash interest, amortization of market lease intangibles, net, actuarial reserves for insurance claims that have been incurred but not reported, deferral of community fees, and termination fees. Includes the Company’s share of income (loss) generated by unconsolidated joint ventures and excludes noncontrolling interests’ share of income (loss) generated by consolidated joint ventures.

The following table summarizes the Company’s total assets by segment (in thousands):

	December 31,
Segment	2023		2022
Lab	$	9,313,395	$	9,019,271
Outpatient medical	6,376,191		6,291,986
CCRC	2,369,883		2,276,898
Reportable segment assets	18,059,469		17,588,155
Accumulated depreciation and amortization	(4,017,023)		(3,540,362)
Net reportable segment assets	14,042,446		14,047,793
Other non-reportable segment assets	553,031		744,550
Assets held for sale, net	117,986		49,866
Other non-segment assets	985,387		929,020
Total assets	$	15,698,850	$	15,771,229

See Notes 3, 4, 5, 6, 7, 8, and 18 for significant transactions impacting the Company’s segment assets during the periods presented.

At each of December 31, 2023 and 2022, goodwill of $18 million was allocated to the Company’s segment assets as follows: (i) $14 million for outpatient medical, (ii) $2 million for CCRC, and (iii) $2 million for other non-reportable.