Summary of components of our rental income

The following table summarizes components of our rental income for the years ended December 31, 2023, 2022 and 2021 (in thousands):


	December 31,
Rental Income		2023			2022			2021
Contractual cash rental income	$	116,702	⁽¹⁾	$	115,230	⁽²⁾	$	107,692
Variable cash rental income		13,525	⁽³⁾		15,516	⁽³⁾		14,332	⁽³⁾
Straight-line rent		(2,078)	⁽⁴⁾		(1,369)	⁽⁵⁾		467
Adjustment of lease incentives and rental income		(26)	⁽⁶⁾		(256)	⁽⁶⁾		(758)	⁽⁶⁾
Amortization of lease incentives		(773)			(877)			(608)
Total	$	127,350		$	128,244		$	121,125

(1)	Increased primarily due to rental income from acquisitions and transitioned portfolios, repayment of deferred rent and annual rent escalations, partially offset by sold properties.

(2)

Increased primarily due to rent received from transitioned portfolios, rental income from acquisitions, completed development projects, annual rent escalations, and lease termination fee income of $1,181 received in connection with the sale of a 74-unit ALF partially offset by decreased rent from the sold properties.

(3)	The variable cash rental income for the years ended December 31, 2023, 2022 and 2021 primarily includes reimbursement of real estate taxes by our lessees.

(4)	Decreased primarily due to deferred rent repayment and normal amortization.

(5)	Decreased primarily due to a deferred rent repayment, normal amortization and the impact of the 50% reduction of 2021 rent escalations for those leases accounted for on a straight-line basis.

(6)	Represents straight-line rent receivable and lease incentives write-offs.

Schedule of impairment loss


		Type	Number	Number
		of	of	of	Impairment
Year	State	Properties	Properties	Beds/Units	Loss
2023	Florida	ALF	1	70	$	434	⁽¹⁾
	Florida	ALF	1	60		7,522
	Mississippi	ALF	1	67		4,554	⁽²⁾
	Texas	ALF	7	248		3,265
			10	445	$	15,775

2022	Florida	ALF	1	70	$	1,222	⁽¹⁾
	Kentucky	ALF	1	60		1,286	⁽³⁾
	Colorado	ALF	1	—		914	⁽⁴⁾
			3	130	$	3,422

(1)

In conjunction with the ongoing negotiations to sell this community, we recorded a $434 impairment loss during the three months ended March 31, 2023, and a $1,222 impairment loss during the fourth quarter of 2022. This community was sold during the second quarter of 2023 for $4,850 and we recorded a net gain on sale of $64 as a result of this transaction.

(2)	This community was sold during the fourth quarter of 2023 for $1,650 and we recorded a net loss on sale of $219 as a result of this transaction.

(3)	This community was classified as held-for sale at December 31, 2022 and sold during the first quarter of 2023 for $11,000. We recorded a net gain on sale of $57 as a result of this transaction. See Properties Held-for-Sale below for more information regarding this community.

(4)	This community was closed during 2022.

Summary of acquisitions

Acquisitions. The following table summarizes our acquisitions for the years ended December 31, 2023 through 2021 (dollar amounts in thousands):


		Cash					Non-						Number	Number
		Paid at		Assumed			Controlling	Transaction			Assets		of	of
Year	Type of Property	Acquisition		Liabilities			Interest	Costs			Acquired		Properties	Beds/Units
2023	ALF ⁽¹⁾	$	43,759	$	9,767	$	9,133	$	363	$	63,022	⁽²⁾	1	242
2022	SNF⁽³⁾		51,817		—		—		—		51,817		4	339
2021	n/a		—		—		—		—		—		—	—

(1)

We entered into a $54,134 Joint Venture (“JV”) and contributed $45,000 into the JV that purchased an ILF/ALF/MC in Ohio. Under the JV agreement, the seller, our JV partner, has the option to purchase the campus between the third and fourth lease years for LTC’s allocation of the JV investment plus an IRR of 9.75%. The campus was leased to Encore Senior Living (“Encore”) under a 10-year term with an initial yield of 8.25% on LTC’s allocation of the JV investment. LTC committed to fund $2,100 of lease incentives under the Encore lease of which $1,458 has been funded.

(2)	Includes $8,309 tax abatement intangible included in the Prepaid expenses and other assets line item in our Consolidated Balance Sheets.

(3)

The properties are located in Texas and are leased to an affiliate of an existing operator under a 10-year lease with two 5-year renewal options. Additionally, the lease provides either an earn-out payment or purchase option but not both. If neither option is elected within the timeframe defined in the lease, both elections are terminated. The earn-out payment is available, contingent on achieving certain thresholds per the lease, beginning at the end of the second lease year through the end of the fifth lease year. The purchase option is available beginning in the sixth lease year through the end of the seventh lease year. The initial cash yield is 8% for the first year, increasing to 8.25% for the second year, then increases annually by 2.0% to 4.0% based on the change in the Medicare Market Basket Rate. In connection with the transaction, we provided the lessee a 10-year working capital loan for up to $2,000 at 8% for first year, increasing to 8.25% for the second year, then increasing annually with the lease rate. During 2023, the working capital loan was fully repaid. Accordingly, the working capital commitment has been terminated.

Schedule of future amortization expenses related to the intangible assets

The following table provides future amortization expenses related to the intangible assets at December 31, 2023 (in thousands):


	Total		2024			2025		2026		2027		2028		Thereafter
In-place leases ⁽¹⁾	$	5,239	$	877		$	825	$	740	$	675	$	532	$	1,590
Tax abatement intangible ⁽²⁾		7,904		692	⁽¹⁾		692		692		692		692		4,444
	$	13,143	$	1,569		$	1,517	$	1,432	$	1,367	$	1,224	$	6,034

(1)	Recorded as depreciation expense included in the Depreciation and amortization line item on our Consolidated Statements of Income.

(2)	Recorded as Property tax expense on our Consolidated Statements of Income.

Schedule of property sold


		Type	Number	Number
		of	of	of		Sales		Carrying		Net
Year	State	Properties	Properties	Beds/Units		Price		Value		Gain (Loss) ⁽¹⁾
2023	Florida	ALF	5	246	$	23,600	$	9,084	$	13,327
	Kentucky	ALF	1	60		11,000		10,720		57
	Mississippi	ALF	1	67		1,650		1,639		(220)
	New Jersey	ALF	1	39		2,000		1,552		266
	New Mexico	SNF	2	235		21,250		5,523		15,287
	Nebraska	ALF	3	117		2,984		2,934		—
	Oklahoma	ALF	1	37		800		777		11
	Pennsylvania	ALF	2	130		11,128		6,054		4,860
	South Carolina	ALF	3	128		8,409		4,446		3,708
Total			19	1,059	$	82,821	$	42,729	$	37,296

2022	California	ALF	2	232	$	43,715	$	17,832	$	25,867
	California	SNF	1	121		13,250		1,846		10,846
	Texas	SNF	1	—		485		697		(441)
	Virginia	ALF	1	74		16,895		15,549		1,344	⁽²⁾
	n/a	n/a	—	—		—		—		214	⁽³⁾
Total			5	427	$	74,345	$	35,924	$	37,830

2021	Florida	ALF	1	—	$	2,000	$	2,626	$	(858)
	Nebraska	ALF	1	40		900		1,079		(200)
	Washington	SNF	1	123		7,700		4,513		2,562
	Wisconsin	ALF	3	263		35,000		28,295		5,595
	n/a	n/a	—	—		—		—		363	⁽³⁾
Total			6	426	$	45,600	$	36,513	$	7,462

(1)	Calculation of net gain (loss) includes cost of sales and write-off of straight-line rent receivable and lease incentives, when applicable.

(2)	In connection with this sale, the former operator paid us a lease termination fee of $1,181 which is not included in the gain on sale.

(3)	We recognized additional gain due to the reassessment adjustment of the holdbacks related to properties sold during 2020 and

2019, under the expected value model per ASC Topic 606, Contracts with Customers.

Summary of investments in mortgage loans secured by first mortgages

The following table summarizes our investments in mortgage loans secured by first mortgages at December 31, 2023 (dollar amounts in thousands):


					Type	Percentage		Number of					Investment
			Gross		of	of					SNF	ALF	per
Interest Rate	Maturity	State	Investment		Property	Investment		Loans ⁽¹⁾	Properties ⁽²⁾		Beds	Units	Bed/Unit
7.5%	2024	MO	$	1,999	OTH	0.4	%	1	—	⁽³⁾	—	—	$	n/a
7.5%	2024	LA		29,346	SNF	6.1	%	1	1		189	—	$	155.27
7.5%	2024	GA		51,111	ALF	10.6	%	1	1		—	203	$	251.78
8.8%	2025	FL		4,000	ALF	0.8	%	1	2		—	92	$	43.48
7.8%	2025	FL		16,706	ALF	3.4	%	1	1		—	112	$	149.16
7.3%	2025	NC		10,750	ALF	2.2	%	1	1		—	45	$	238.89
7.3% ⁽⁴⁾	2025	NC/SC		58,331	ALF	12.1	%	1	13		—	523	$	111.53
7.3% ⁽⁴⁾	2026	NC		34,043	ALF	7.1	%	1	4		—	217	$	156.88
7.3% ⁽⁴⁾	2026	NC		826	OTH	0.2	%	1	—	⁽⁵⁾	—	—	$	n/a
8.8%	2028	IL		16,500	SNF	3.4	%	1	1		150	—	$	110.00
10.8% ⁽⁶⁾	2043	MI		183,968	SNF	38.2	%	1	15		1,875	—	$	98.12
9.8% ⁽⁶⁾	2045	MI		39,950	SNF	8.3	%	1	4		480	—	$	83.23
10.1% ⁽⁶⁾	2045	MI		19,700	SNF	4.1	%	1	2		201	—	$	98.01
10.3% ⁽⁶⁾	2045	MI		14,850	SNF	3.1	%	1	1		146	—	$	101.71
Total			$	482,080		100.0	%	14	46		3,041	1,192	$	113.89

(1)	Some loans contain certain guarantees and/or provide for certain facility fees.

(2)	Our mortgage loans are secured by properties located in eight states with eight borrowers.

(3)	Represents a mortgage loan secured by a parcel of land for the future development of a 91-bed post-acute SNF.

(4)	Represents the initial rate. This loan has an IRR of 8%.

(5)	Represents a mortgage loan secured by a parcel of land in North Carolina held for future development of a seniors housing community.

(6)	Mortgage loans provide for 2.25% annual increases in the interest rate after a certain time period.

Scheduled principal payments on mortgage loan receivables

Scheduled principal payments on mortgage loan receivables are as follows (in thousands):


	Scheduled
	Principal
2024	$	83,137
2025		90,466
2026		35,549
2027		680
2028		17,180
Thereafter		255,068
Total	$	482,080