Investment in Unconsolidated Entity and Other Assets

3 Months Ended

Mar. 31, 2013

JOINT VENTURE [Abstract]

Equity Method Investments and Joint Ventures Disclosure [Text Block]

INVESTMENT IN UNCONSOLIDATED ENTITY AND OTHER ASSETS

Investment in the unconsolidated entity, OpCo, and other assets consist of the following (in thousands):

	March 31, 2013		December 31, 2012
Equity interest in unconsolidated entity, OpCo	$	8,375	$	8,353
Loan costs and prepaid expenses, net	1,892		2,004
Accounts receivable and other assets	2,240		1,815
	$	12,507	$	12,172

OpCo is intended to be self-financing, and aside from initial investments, no support has been provided by NHI to OpCo since acquisition on September 30, 2012. While PropCo's rental revenues of the related properties are sourced from OpCo, a decision to furnish additional support would be at our discretion and not obligatory. As a result, NHI believes its maximum exposure to loss at March 31, 2013, due to its involvement with OpCo, would be limited to its equity interest. We have concluded that OpCo meets the accounting criteria to be considered a variable interest entity. However, because we do not control the entity, nor do we have any role in the day-to-day management, we are not the primary beneficiary of the entity, and we carry our investment using the equity method. There have been no distributions declared during the three months ended March 31, 2013.

Unaudited summary financial information for OpCo, for which our equity in its income is presented in our condensed consolidated financial statements, is presented below (in thousands):

	Three Months Ended
	March 31,
	2013		2012
Revenues	$	6,189	$	—
Operating expenses, including management fees	4,056		—
Lease expenses	2,081		—
Depreciation and amortization	27		—
Net Income	$	25	$	—

At acquisition, we allocated the total purchase price for the assets acquired, which included our equity interest in OpCo, based upon their relative fair values. Such allocations have not been finalized as we await definitive asset valuations and, as such, remain preliminary and subject to adjustment. We continue to monitor and periodically review our equity method investment in OpCo for impairment to determine whether a decline, if any, in the value of the investment is other than temporary.