XML 24 R14.htm IDEA: XBRL DOCUMENT v3.19.1
Commitments And Contingencies
3 Months Ended
Mar. 31, 2019
Commitments and Contingencies Disclosure [Abstract]  
Commitments And Contingencies
COMMITMENTS AND CONTINGENCIES

In the normal course of business, we enter into a variety of commitments, typically funding of revolving credit arrangements, construction and mezzanine loans to our operators to conduct expansions and acquisitions for their own account, and commitments for the funding of construction for expansion or renovation to our existing properties under lease. In our leasing operations, we offer to our tenants and to sellers of newly-acquired properties a variety of inducements which originate contractually as contingencies but which may become commitments upon the satisfaction of the contingent event. Contingent payments earned will be included in the respective lease bases when funded. The tables below summarize our existing, known commitments and contingencies as of March 31, 2019 according to the nature of their impact on our leasehold or loan portfolios.

 
Asset Class
 
Type
 
Total
 
Funded
 
Remaining
Loan Commitments:
 
 
 
 
 
 
 
 
 
LCS Sagewood Note A
SHO
 
Construction
 
$
118,800,000

 
$
(77,118,000
)
 
$
41,682,000

LCS Sagewood Note B
SHO
 
Construction
 
61,200,000

 
(15,612,000
)
 
45,588,000

LCS Timber Ridge Note A
SHO
 
Construction
 
60,000,000

 
(58,975,000
)
 
1,025,000

Bickford Senior Living
SHO
 
Construction
 
56,700,000

 
(36,415,000
)
 
20,285,000

Senior Living Communities
SHO
 
Revolving Credit
 
15,000,000

 
(2,758,000
)
 
12,242,000

 
 
 
 
 
$
311,700,000

 
$
(190,878,000
)
 
$
120,822,000



See Note 3 to our condensed consolidated financial statements for full details of our loan commitments. As provided above, loans funded do not include the effects of discounts or commitment fees.

 
Asset Class
 
Type
 
Total
 
Funded
 
Remaining
Development Commitments:
 
 
 
 
 
 
 
 
 
Ignite Medical Resorts
SNF
 
Construction
 
$
25,350,000

 
$
(6,621,000
)
 
$
18,729,000

Woodland Village
SHO
 
Renovation
 
7,450,000

 
(7,268,000
)
 
182,000

Senior Living Communities
SHO
 
Renovation
 
6,830,000

 
(5,808,000
)
 
1,022,000

Senior Living Communities
SHO
 
Renovation
 
3,100,000

 

 
3,100,000

Bickford Senior Living
SHO
 
Renovation
 
1,750,000

 
(1,750,000
)
 

Navion Senior Solutions
SHO
 
Construction
 
650,000

 

 
650,000

Discovery Senior Living
SHO
 
Renovation
 
500,000

 
(302,000
)
 
198,000

 
 
 
 
 
$
45,630,000

 
$
(21,749,000
)
 
$
23,881,000



 
Asset Class
 
Type
 
Total
 
Funded
 
Remaining
Contingencies:
 
 
 
 
 
 
 
 
 
Bickford Senior Living
SHO
 
Lease Inducement
 
$
10,000,000

 
$
(8,750,000
)
 
$
1,250,000

Bickford Senior Living
SHO
 
Incentive Loan Draws
 
8,000,000

 
(250,000
)
 
7,750,000

Wingate Healthcare
SHO
 
Lease Inducement
 
5,000,000

 

 
5,000,000

Navion Senior Solutions
SHO
 
Lease Inducement
 
4,850,000

 

 
4,850,000

Ignite Medical Resorts
SNF
 
Lease Inducement
 
2,000,000

 

 
2,000,000

 
 
 
 
 
$
29,850,000

 
$
(9,000,000
)
 
$
20,850,000



Contingent lease inducement payments of $10,000,000 related to the five Bickford development properties constructed in 2016 and 2017 include a licensure incentive of $250,000 per property and a three-tiered operator incentive schedule paying up to an additional $1,750,000, based on the attainment of certain performance metrics. Upon funding, these payments are added to the lease base and amortized against rental income.

Litigation

See Note 2 for a discussion of our litigation involving our former tenants East Lake Capital Management LLC, SH Regency Leasing LLC and The LaSalle Group, including our transition of properties to other operators.

Our facilities are subject to claims and suits in the ordinary course of business. Our lessees and borrowers have indemnified, and are obligated to continue to indemnify us, against all liabilities arising from the operation of the facilities, and are further obligated to indemnify us against environmental or title problems affecting the real estate underlying such facilities. While there may be lawsuits pending against certain of the owners and/or lessees of the facilities, management believes that the ultimate resolution of all such pending proceedings will have no material adverse effect on our financial condition, results of operations or cash flows.