Segment Reporting

3 Months Ended

Mar. 31, 2013

Segment Reporting [Abstract]

Segment Reporting

17. Segment Reporting

We invest in seniors housing and health care real estate. We evaluate our business and make resource allocations on our five operating segments: seniors housing triple-net, seniors housing operating, medical office buildings, hospitals and life science. Our seniors housing triple-net properties include skilled nursing/post-acute facilities, assisted living facilities, independent living/continuing care retirement communities and combinations thereof. Under the seniors housing triple-net segment, we invest in seniors housing and health care real estate through acquisition and financing of primarily single tenant properties. Properties acquired are primarily leased under triple-net leases and we are not involved in the management of the property. Our seniors housing operating properties include seniors housing communities that are owned and/or operated through RIDEA structures (see Notes 3 and 18).

Our medical facility properties include medical office buildings, hospitals and life science buildings which are aggregated into our medical facilities reportable segment. Our medical office buildings are typically leased to multiple tenants and generally require a certain level of property management. Our hospital investments are leased and we are not involved in the management of the property. Our life science investment represents an investment in an unconsolidated entity (see Note 7).

The accounting policies of the segments are the same as those described in the summary of significant accounting policies (see Note 2to the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2012). The results of operations for all acquisitions described in Note 3 are included in our consolidated results of operations from the acquisition dates and are components of the appropriate segments. There are no intersegment sales or transfers.

We evaluate performance based upon net operating income from continuing operations (“NOI”) of each segment. We define NOI as total revenues, including tenant reimbursements, less property level operating expenses, which exclude depreciation and amortization, general and administrative expenses, transaction costs, provision for loan losses and interest expense. We believe NOI provides investors relevant and useful information because it measures the operating performance of our properties at the property level on an unleveraged basis. We use NOI to make decisions about resource allocations and to assess the property level performance of our properties.

Non-segment revenue consists mainly of interest income on non-real estate investments and other income. Non-segment assets consist of corporate assets including cash, deferred loan expenses and corporate offices and equipment among others. Non-property specific revenues and expenses are not allocated to individual segments in determining NOI.

Summary information for the reportable segments for the three months ended March 31, 2013 and 2012 is as follows (in thousands):

Three Months Ended March 31, 2013:		Seniors Housing Triple-net		Seniors Housing Operating		Medical Facilities		Non-segment / Corporate		Total
Rental income	$	185,309	$	-	$	111,525	$	-	$	296,834
Resident fees and services		-		327,324		-		-		327,324
Interest income		5,844		757		2,456		-		9,057
Other income		209		-		410		81		700
Total revenues		191,362		328,081		114,391		81		633,915
Property operating expenses		-		(224,503)		(28,851)		-		(253,354)
Net operating income from continuing operations		191,362		103,578		85,540		81		380,561
Reconciling items:
Interest expense		(6,545)		(19,070)		(9,572)		(75,102)		(110,289)
(Loss) gain on derivatives, net		-		(2,309)		-		-		(2,309)
Depreciation and amortization		(56,255)		(89,875)		(40,969)		-		(187,099)
General and administrative		-		-		-		(27,179)		(27,179)
Transaction costs		(494)		(65,325)		(161)		-		(65,980)
(Loss) gain on extinguishment of debt, net		-		308		-		-		308
Income (loss) from continuing operations before income taxes and income from unconsolidated entities	$	128,068	$	(72,693)	$	34,838	$	(102,200)	$	(11,987)
Total assets	$	8,638,136	$	7,377,227	$	4,569,112	$	204,497	$	20,788,972

Three Months Ended March 31, 2012:		Seniors Housing Triple-net		Seniors Housing Operating		Medical Facilities		Non-segment / Corporate		Total
Rental income	$	161,936	$	-	$	88,059	$	-	$	249,995
Resident fees and services		-		158,174		-		-		158,174
Interest income		5,877		-		2,264		-		8,141
Other income		847		-		604		235		1,686
Total revenues		168,660		158,174		90,927		235		417,996
Property operating expenses		-		(107,243)		(21,558)		-		(128,801)
Net operating income from continuing operations		168,660		50,931		69,369		235		289,195
Reconciling items:
Interest expense		(589)		(15,835)		(8,274)		(64,116)		(88,814)
(Loss) gain on derivatives, net		-		(555)		-		-		(555)
Depreciation and amortization		(49,446)		(39,773)		(31,688)		-		(120,907)
General and administrative		-		-		-		(27,751)		(27,751)
Transaction costs		(1,523)		(1,578)		(2,478)		-		(5,579)
Income (loss) from continuing operations before income taxes and income from unconsolidated entities	$	117,102	$	(6,810)	$	26,929	$	(91,632)	$	45,589

Our portfolio of properties and other investments are located in the United States, the United Kingdom and Canada. Revenues and assets are attributed to the country in which the property is physically located. The following is a summary of geographic information for our operations for the periods presented (in thousands):

		Three Months Ended
		March 31, 2013			March 31, 2012
Revenues:		Amount	%		Amount	%
United States	$	573,371	90.4%	$	417,996	100.0%
International		60,544	9.6%		-	0.0%
Total	$	633,915	100.0%	$	417,996	100.0%
		As of
		March 31, 2013			December 31, 2012
Assets:		Amount	%		Amount	%
United States	$	18,991,182	91.4%	$	18,692,214	95.6%
International		1,797,790	8.6%		856,895	4.4%
Total	$	20,788,972	100.0%	$	19,549,109	100.0%