The Mergers (Tables)

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

The consideration transferred on the Closing Date is as follows (in thousands, except per share data):


	March 1, 2024
Physicians Realty Trust common shares and Physicians Realty Trust restricted shares, PSUs, and RSUs exchanged(1)	240,699
Exchange Ratio	0.674
Shares of Healthpeak common stock issued	162,231
Closing price of Healthpeak common stock on March 1, 2024(2)	$	17.10
Fair value of Healthpeak common stock issued to the former holders of Physicians Realty Trust common shares, restricted shares, PSUs, and RSUs	2,774,147

Less: Fair value of preliminary share consideration attributable to the post-combination period(3)	(16,223)

Physicians Realty Trust revolving credit facility termination(4)	175,411
Settlement of Physicians Realty Trust’s transaction costs	23,913
Payments made in connection with share settlement(5)	11,315

Preliminary cash consideration	210,639

Consideration transferred	$	2,968,563

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(1)Includes 241 million Physicians Realty Trust common shares and Physicians Realty Trust restricted shares outstanding as of March 1, 2024, inclusive of: (i) 200 thousand Physicians Realty Trust restricted shares; (ii) 1 million Physicians Realty Trust common shares issuable pursuant to outstanding Physicians Realty Trust performance-based restricted stock unit (“PSUs”) (reflected at the maximum level of performance); and (iii) 300 thousand Physicians Realty Trust common shares issuable pursuant to outstanding Physicians Realty Trust restricted stock units (“RSUs”).

(2)The fair value of Healthpeak common stock issued to former holders of Physicians Realty Trust common shares and Physicians Realty Trust restricted shares, PSUs, and RSUs is based on the per share closing price of Healthpeak common stock on March 1, 2024.

(3)Represents the fair value of unvested Physicians Realty Trust restricted shares, PSUs, and RSUs attributable to post-combination services that were converted into Healthpeak common stock on the Closing Date in accordance with the Merger Agreement. Although no future service after the Closing Date is required, the value attributable to post-combination services reflects the incremental fair value provided to the Physicians Realty Trust equity award holders and the accelerated vesting of such awards at the Closing Date in accordance with the Merger Agreement. This amount was recognized as transaction and merger-related costs on the Consolidated Statements of Operations.

(4)Represents the Company’s cash repayment of all outstanding balances under Physicians Realty Trust’s revolving credit facility on the Closing Date in connection with the related termination.

(5)Includes cash settlement of: (i) tax liability related to holdback elections made under the pre-existing terms and conditions of Physicians Realty Trust’s equity programs and (ii) fractional share consideration.

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the preliminary estimated fair values of the assets acquired, liabilities assumed, and noncontrolling interests at the Closing Date (in thousands):


	March 1, 2024
ASSETS
Real estate:
Buildings and improvements	$	3,199,884
Development costs and construction in progress	68,171
Land and improvements	435,353
Real estate	3,703,408
Loans receivable	118,908
Investments in and advances to unconsolidated joint ventures	58,636
Accounts receivable, net(1)	9,536
Cash and cash equivalents	30,417
Restricted cash	1,007
Intangible assets(2)	890,827
Right-of-use asset	191,415
Other assets	44,691
Total assets	$	5,048,845

LIABILITIES AND EQUITY
Term loans	$	402,320
Senior unsecured notes	1,139,760
Mortgage debt	127,176
Intangible liabilities(3)	149,875
Lease liability	97,160
Accounts payable, accrued liabilities, and other liabilities	72,864

Total liabilities	$	1,989,155

Redeemable noncontrolling interests	1,536

Joint venture partners(4)	20,109
Non-managing member unitholders(5)	116,618
Total noncontrolling interests	$	136,727

Fair value of net assets acquired and liabilities assumed, net of noncontrolling interests	$	2,921,427

Goodwill	47,136

Total purchase price	$	2,968,563

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(1)Includes $14 million of gross contractual accounts receivable.

(2)The intangible assets acquired had a weighted average amortization period of 6 years (see Note 9).

(3)The intangible liabilities acquired had a weighted average amortization period of 9 years (see Note 9).

(4)Includes six consolidated joint ventures in which the Company holds ownership interests ranging from 56.7% to 99.7%.

(5)In connection with the Merger, Physicians Partnership merged with and into DOC DR OP Sub with DOC DR OP Sub surviving as the Partnership Surviving Entity. The Company controls the Partnership Surviving Entity via its ownership of its managing member, and the Partnership Surviving Entity is consolidated by the Company. As of March 31, 2024, approximately 7 million DownREIT units of the Partnership Surviving Entity were outstanding (7 million shares of Healthpeak common stock are issuable upon conversion).

Schedule of Proforma Financial Information

The following unaudited pro forma financial information is not necessarily indicative of the results of operations had the acquisition been effected on the assumed date, nor is it necessarily an indication of trends in future results for a number of reasons, including, but not limited to, differences between the assumptions used to prepare the unaudited pro forma financial information, cost savings from operating efficiencies, potential synergies, and the impact of incremental costs incurred in integrating the businesses.


	Three Months Ended March 31,
	2024		2023
Total revenues	$	698,702	$	673,664
Net income (loss) applicable to common shares	87,604		(35,676)