Investments (Tables)
|
6 Months Ended |
Jun. 30, 2020 |
|---|
| Real Estate [Abstract] |
|
| Summary of Real Estate Activity |
During the six months ended June 30, 2020, the Company had the following real estate activity, net of accumulated depreciation and amortization (dollars in thousands):
|
|
|
Number of Properties |
|
|
Dollar Amount of Investments |
|
|
|
|
Held in Use |
|
|
Held for Sale |
|
|
Total |
|
|
Held in Use |
|
|
Held for Sale |
|
|
Total |
|
|
Gross balance, December 31, 2019 |
|
|
1,750 |
|
|
|
2 |
|
|
|
1,752 |
|
|
$ |
6,140,775 |
|
|
$ |
1,223 |
|
|
$ |
6,141,998 |
|
|
Acquisitions/improvements (1) |
|
|
29 |
|
|
|
— |
|
|
|
29 |
|
|
|
228,812 |
|
|
|
— |
|
|
|
228,812 |
|
|
Dispositions of real estate (2) |
|
|
(7 |
) |
|
|
(3 |
) |
|
|
(10 |
) |
|
|
(19,239 |
) |
|
|
(1,842 |
) |
|
|
(21,081 |
) |
|
Transfers to Held for Sale |
|
|
(8 |
) |
|
|
8 |
|
|
|
— |
|
|
|
(13,705 |
) |
|
|
13,705 |
|
|
|
— |
|
|
Transfers from Held for Sale |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Impairments (3) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(61,708 |
) |
|
|
(32 |
) |
|
|
(61,740 |
) |
|
Reset of gross balances(4) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(33,918 |
) |
|
|
(6 |
) |
|
|
(33,924 |
) |
|
Other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,337 |
) |
|
|
— |
|
|
|
(1,337 |
) |
|
Gross balance, June 30, 2020 |
|
|
1,764 |
|
|
|
7 |
|
|
|
1,771 |
|
|
|
6,239,680 |
|
|
|
13,048 |
|
|
|
6,252,728 |
|
|
Accumulated depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(900,501 |
) |
|
|
(340 |
) |
|
|
(900,841 |
) |
|
Net balance, June 30, 2020 (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
5,339,179 |
|
|
$ |
12,708 |
|
|
$ |
5,351,887 |
|
|
(1) |
Includes investments of $7.6 million in revenue producing capitalized expenditures, as well as $2.4 million of non-revenue producing capitalized expenditures during the six months ended June 30, 2020. |
|
(2) |
For the six months ended June 30, 2020, the total gain on disposal of assets for properties held in use and held for sale was $1.1 million and $0.1 million, respectively. |
|
(3) |
Impairments on owned real estate is comprised of $61.4 million of real estate and intangible asset impairment and $0.3 million of allowance for credit losses on direct financing leases. |
|
(4) |
Represents write-off of gross investment balances against the related accumulated depreciation and amortization balances as a result of basis reset due to impairment or intangibles which have been fully amortized. |
|
(5) |
Reconciliation of total owned investments to the accompanying consolidated balance sheet at June 30, 2020 is as follows: |
|
Operating lease held in use land and buildings, net |
|
$ |
5,102,347 |
|
|
Intangible lease assets, net |
|
|
|
|
350,466 |
|
|
Real estate assets under direct financing leases, net |
|
|
|
|
7,300 |
|
|
Real estate assets held for sale, net |
|
|
|
|
12,708 |
|
|
Intangible lease liabilities, net |
|
|
|
|
(120,934 |
) |
|
Net balance |
|
|
|
$ |
5,351,887 |
|
|
| Schedule of Operating Lease Income |
The following table summarizes the components of rental income recognized on these operating leases in the accompanying consolidated statements of operations (in thousands):
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
Base Cash Rent(1) |
|
$ |
110,166 |
|
|
$ |
98,418 |
|
|
$ |
226,712 |
|
|
$ |
195,217 |
|
|
Variable cash rent (including reimbursables) |
|
|
2,404 |
|
|
|
2,942 |
|
|
|
5,793 |
|
|
|
6,580 |
|
|
Straight-line rent, net of uncollectible reserve(2) |
|
|
4,392 |
|
|
|
4,485 |
|
|
|
5,486 |
|
|
|
7,392 |
|
|
Amortization of above- and below- market lease intangibles, net (3) |
|
|
228 |
|
|
|
661 |
|
|
|
562 |
|
|
|
1,384 |
|
|
Total rental income |
|
$ |
117,190 |
|
|
$ |
106,506 |
|
|
$ |
238,553 |
|
|
$ |
210,573 |
|
|
(1) |
Includes rent reserved as uncollectible of $4.8 million and net recoveries of $0.8 million for the three months ended June 30, 2020 and 2019, respectively, and reserves of $5.6 million and net recoveries of $1.0 million for the six months ended June 30, 2020 and 2019, respectively. |
|
(2) |
Includes net uncollectible reserve/(recovery) of $2.4 million and $(0.6 million) for the three months ended June 30, 2020 and 2019, respectively, and $6.7 million and $0.3 million for the six months ended June 30, 2020 and 2019, respectively. |
|
(3) |
Excludes amortization of in-place leases of $8.7 million and $6.5 million for the three months ended June 30, 2020 and 2019, respectively, and $17.5 million and $13.2 million for the six months ended June 30, 2020 and 2019, respectively, which is included in depreciation and amortization expense in the accompanying consolidated statements of operations. |
|
| Schedule of Minimum Future Rent to be Received from Operating Lease |
Scheduled minimum future rent to be received under the remaining non-cancellable term of these operating leases (including contractual fixed rent increases occurring on or after July 1, 2020) at June 30, 2020 are as follows (in thousands):
|
|
|
June 30, 2020 |
|
|
Remainder of 2020 |
|
$ |
237,029 |
|
|
2021 |
|
|
466,427 |
|
|
2022 |
|
|
449,638 |
|
|
2023 |
|
|
429,129 |
|
|
2024 |
|
|
405,130 |
|
|
Thereafter |
|
|
3,066,883 |
|
|
Total future minimum rentals |
|
$ |
5,054,236 |
|
|
| Schedule of Lease Intangible Assets and Liabilities, Net of Accumulated Amortization |
The following table details lease intangible assets and liabilities, net of accumulated amortization (in thousands):
|
|
|
June 30,
2020 |
|
|
December 31,
2019 |
|
|
In-place leases |
|
$ |
441,072 |
|
|
$ |
457,616 |
|
|
Above-market leases |
|
|
84,385 |
|
|
|
95,002 |
|
|
Less: accumulated amortization |
|
|
(174,991 |
) |
|
|
(167,539 |
) |
|
Intangible lease assets, net |
|
$ |
350,466 |
|
|
$ |
385,079 |
|
|
|
|
|
|
|
|
|
|
|
|
Below-market leases |
|
$ |
173,362 |
|
|
$ |
176,816 |
|
|
Less: accumulated amortization |
|
|
(52,428 |
) |
|
|
(49,481 |
) |
|
Intangible lease liabilities, net |
|
$ |
120,934 |
|
|
$ |
127,335 |
|
|
| Summary of Impairment and Credit Losses Recognized |
The following table summarizes total impairments and allowance for credit losses recognized in the accompanying consolidated statements of operations (in thousands):
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
Real estate and intangible asset impairment |
|
$ |
21,272 |
|
|
$ |
3,607 |
|
|
$ |
61,436 |
|
|
$ |
7,299 |
|
|
Allowance for credit losses on direct financing leases |
|
|
— |
|
|
|
— |
|
|
|
304 |
|
|
|
— |
|
|
(Reversal)/allowance for credit losses on loans receivable |
|
|
(223 |
) |
|
|
— |
|
|
|
83 |
|
|
|
— |
|
|
Total impairment loss |
|
$ |
21,049 |
|
|
$ |
3,607 |
|
|
$ |
61,823 |
|
|
$ |
7,299 |
|
|