Investments (Tables)
|
9 Months Ended |
Sep. 30, 2020 |
|---|
| Real Estate [Abstract] |
|
| Summary of Real Estate Activity |
During the nine months ended September 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) |
|
|
47 |
|
|
|
— |
|
|
|
47 |
|
|
|
443,960 |
|
|
|
— |
|
|
|
443,960 |
|
|
Dispositions of real estate (2) |
|
|
(14 |
) |
|
|
(7 |
) |
|
|
(21 |
) |
|
|
(49,885 |
) |
|
|
(4,975 |
) |
|
|
(54,860 |
) |
|
Transfers to Held for Sale |
|
|
(18 |
) |
|
|
18 |
|
|
|
— |
|
|
|
(47,916 |
) |
|
|
47,916 |
|
|
|
— |
|
|
Impairments (3) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(65,308 |
) |
|
|
(4,621 |
) |
|
|
(69,929 |
) |
|
Reset of gross balances(4) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(37,807 |
) |
|
|
(2,204 |
) |
|
|
(40,011 |
) |
|
Other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,339 |
) |
|
|
— |
|
|
|
(1,339 |
) |
|
Gross balance, September 30, 2020 |
|
|
1,765 |
|
|
|
13 |
|
|
|
1,778 |
|
|
|
6,382,480 |
|
|
|
37,339 |
|
|
|
6,419,819 |
|
|
Accumulated depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(938,246 |
) |
|
|
(3,454 |
) |
|
|
(941,700 |
) |
|
Net balance, September 30, 2020 (5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
5,444,234 |
|
|
$ |
33,885 |
|
|
$ |
5,478,119 |
|
|
(1) |
Includes investments of $8.6 million in revenue producing capitalized expenditures, as well as $1.8 million of non-revenue producing capitalized expenditures during the nine months ended September 30, 2020. |
|
(2) |
For the nine months ended September 30, 2020, the total gain on disposal of assets for properties held in use and held for sale was $10.1 million and $1.9 million, respectively. |
|
(3) |
Impairments on owned real estate is comprised of real estate and intangible asset impairment and 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 September 30, 2020 is as follows: |
|
Operating lease held in use land and buildings, net |
|
$ |
5,208,509 |
|
|
Intangible lease assets, net |
|
|
|
|
349,347 |
|
|
Real estate assets under direct financing leases, net |
|
|
|
|
7,444 |
|
|
Real estate assets held for sale, net |
|
|
|
|
33,885 |
|
|
Intangible lease liabilities, net |
|
|
|
|
(121,066 |
) |
|
Net balance |
|
|
|
$ |
5,478,119 |
|
|
| 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
September 30, |
|
|
Nine Months Ended
September 30, |
|
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
Base Cash Rent(1) |
|
$ |
108,398 |
|
|
$ |
100,962 |
|
|
$ |
335,110 |
|
|
$ |
296,179 |
|
|
Variable cash rent (including reimbursables) |
|
|
3,051 |
|
|
|
2,823 |
|
|
|
8,843 |
|
|
|
9,403 |
|
|
Straight-line rent, net of uncollectible reserve(2) |
|
|
899 |
|
|
|
4,770 |
|
|
|
6,385 |
|
|
|
12,162 |
|
|
Amortization of above- and below- market lease intangibles, net (3) |
|
|
568 |
|
|
|
956 |
|
|
|
1,131 |
|
|
|
2,340 |
|
|
Total rental income |
|
$ |
112,916 |
|
|
$ |
109,511 |
|
|
$ |
351,469 |
|
|
$ |
320,084 |
|
|
(1) |
Includes net impact of (amounts not deemed probable of collection)/amounts recovered of $(6.5 million) and $(0.2 million) for the three months ended September 30, 2020 and 2019, respectively, and $(12.1 million) and $0.8 million for the nine months ended September 30, 2020 and 2019, respectively. |
|
(2) |
Includes net impact of amounts not deemed probable of collection of $4.3 million for the three months ended September 30, 2020, and $11.0 million and $0.3 million for the nine months ended September 30, 2020 and 2019, respectively. |
|
(3) |
Excludes amortization of in-place leases of $8.4 million and $7.2 million for the three months ended September 30, 2020 and 2019, respectively, and $25.9 million and $20.4 million for the nine months ended September 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 October 1, 2020) at September 30, 2020 are as follows (in thousands):
|
|
|
September 30, 2020 |
|
|
Remainder of 2020 |
|
$ |
120,598 |
|
|
2021 |
|
|
477,810 |
|
|
2022 |
|
|
463,790 |
|
|
2023 |
|
|
445,749 |
|
|
2024 |
|
|
423,521 |
|
|
Thereafter |
|
|
3,266,987 |
|
|
Total future minimum rentals |
|
$ |
5,198,455 |
|
|
| 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):
|
|
|
September 30,
2020 |
|
|
December 31,
2019 |
|
|
In-place leases |
|
$ |
448,147 |
|
|
$ |
457,616 |
|
|
Above-market leases |
|
|
83,809 |
|
|
|
95,002 |
|
|
Less: accumulated amortization |
|
|
(182,609 |
) |
|
|
(167,539 |
) |
|
Intangible lease assets, net |
|
$ |
349,347 |
|
|
$ |
385,079 |
|
|
|
|
|
|
|
|
|
|
|
|
Below-market leases |
|
$ |
175,644 |
|
|
$ |
176,816 |
|
|
Less: accumulated amortization |
|
|
(54,578 |
) |
|
|
(49,481 |
) |
|
Intangible lease liabilities, net |
|
$ |
121,066 |
|
|
$ |
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
September 30, |
|
|
Nine Months Ended
September 30, |
|
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
Real estate and intangible asset impairment |
|
$ |
8,341 |
|
|
$ |
5,932 |
|
|
$ |
69,777 |
|
|
$ |
13,231 |
|
|
(Reversal)/allowance for credit losses on direct financing leases |
|
|
(152 |
) |
|
|
— |
|
|
|
152 |
|
|
|
— |
|
|
Reversal for credit losses on loans receivable |
|
|
(83 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Total impairment loss |
|
$ |
8,106 |
|
|
$ |
5,932 |
|
|
$ |
69,929 |
|
|
$ |
13,231 |
|
|