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TABLE OF CONTENTS
ITEM 8. Financial Statements and Supplementary Data
PART IV

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM 10-K

(Mark One)    

ý

 

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2011

OR

o

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to          

Commission File Number 1-10989



VENTAS, INC.
(Exact Name of Registrant as Specified in Its Charter)

Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
  61-1055020
(IRS Employer
Identification No.)

353 N. Clark Street, Suite 3300, Chicago, Illinois
(Address of Principal Executive Offices)

 

60654
(Zip Code)

(877) 483-6827
(Registrant's Telephone Number, Including Area Code)

         Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class   Name of Each Exchange on Which Registered
Common Stock, par value $0.25 per share   New York Stock Exchange

         Securities registered pursuant to Section 12(g) of the Act: None



         Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ý    No o

         Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o    No ý

         Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

         Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). Yes ý    No o

         Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment of this Form 10-K. ý

         Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ý   Accelerated filer o   Non-accelerated filer o
(Do not check if a
smaller reporting company)
  Smaller reporting company o

         Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o    No ý

         As of June 30, 2011, the aggregate market value of shares of the Registrant's common stock held by non-affiliates of the Registrant was $8.5 billion, computed by reference to the closing price of the common stock as reported on the New York Stock Exchange. For purposes of the foregoing calculation only, all directors, executive officers and 10% beneficial owners of the Registrant have been deemed affiliates.

         As of February 14, 2012, 288,915,189 shares of the Registrant's common stock were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

         Portions of the Registrant's definitive Proxy Statement for the Annual Meeting of Stockholders to be held on May 17, 2012 are incorporated by reference into Part III, Items 10 through 14 of this Annual Report on Form 10-K.

   


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CAUTIONARY STATEMENTS

        Unless otherwise indicated or except where the context otherwise requires, the terms "we," "us" and "our" and other similar terms in this Annual Report on Form 10-K refer to Ventas, Inc. and its consolidated subsidiaries.

Forward-Looking Statements

        This Annual Report on Form 10-K includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements regarding our or our tenants', operators', managers' or borrowers' expected future financial condition, results of operations, cash flows, funds from operations, dividends and dividend plans, financing opportunities and plans, capital markets transactions, business strategy, budgets, projected costs, operating metrics, capital expenditures, competitive positions, acquisitions, investment opportunities, dispositions, merger integration, growth opportunities, expected lease income, continued qualification as a real estate investment trust ("REIT"), plans and objectives of management for future operations, and statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "could," "should," "will," and other similar expressions are forward-looking statements. These forward-looking statements are inherently uncertain, and security holders must recognize that actual results may differ from our expectations. We do not undertake a duty to update these forward-looking statements, which speak only as of the date on which they are made.

        Our actual future results and trends may differ materially from expectations depending on a variety of factors discussed in our filings with the Securities and Exchange Commission (the "SEC"). These factors include without limitation:

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        Many of these factors, some of which are described in greater detail under "Risk Factors" in Part I, Item 1A of this Annual Report on Form 10-K, are beyond our control and the control of our management.

Kindred, Brookdale Senior Living, Sunrise and Atria Information

        Each of Kindred, Brookdale Senior Living Inc. (together with its subsidiaries, "Brookdale Senior Living") and Sunrise Senior Living, Inc. (together with its subsidiaries, "Sunrise") is subject to the reporting requirements of the SEC and is required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information. The information related to Kindred, Brookdale Senior Living and Sunrise contained or referred to in this Annual Report on Form 10-K is derived from SEC filings made by Kindred, Brookdale Senior Living or Sunrise, as the case may be, or from other publicly available information, or has been provided to us by Kindred, Brookdale Senior Living or Sunrise. We have not verified this information either through an independent investigation or by reviewing Kindred's, Brookdale Senior Living's or Sunrise's public filings. We have no reason to believe that this information is inaccurate in any material respect, but we cannot provide any assurance that all of this information is accurate. Kindred's, Brookdale Senior Living's and Sunrise's filings with the SEC can be found on the SEC's website at www.sec.gov. We are providing this data for informational purposes only, and you are encouraged to obtain Kindred's, Brookdale Senior Living's and Sunrise's publicly available filings from the SEC.

        Atria Senior Living, Inc. ("Atria") is not subject to the reporting requirements of the SEC. The information related to Atria contained or referred to in this Annual Report on Form 10-K is derived from publicly available information or has been provided to us by Atria. We have not verified this information through an independent investigation. We have no reason to believe that this information is inaccurate in any material respect, but we cannot provide any assurance that all of this information is accurate.

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TABLE OF CONTENTS

PART I

   

Item 1.

 

Business

 
1

Item 1A.

 

Risk Factors

  29

Item 1B.

 

Unresolved Staff Comments

  47

Item 2.

 

Properties

  47

Item 3.

 

Legal Proceedings

  49

Item 4.

 

(Removed and Reserved)

  49

PART II

   

Item 5.

 

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 
49

Item 6.

 

Selected Financial Data

  52

Item 7.

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

  53

Item 7A.

 

Quantitative and Qualitative Disclosures About Market Risk

  91

Item 8.

 

Financial Statements and Supplementary Data

  92

Item 9.

 

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

  194

Item 9A.

 

Controls and Procedures

  194

Item 9B.

 

Other Information

  194

PART III

   

Item 10.

 

Directors, Executive Officers and Corporate Governance

 
194

Item 11.

 

Executive Compensation

  194

Item 12.

 

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

  194

Item 13.

 

Certain Relationships and Related Transactions, and Director Independence

  195

Item 14.

 

Principal Accountant Fees and Services

  195

PART IV

   

Item 15.

 

Exhibits and Financial Statement Schedules

 
196

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PART I

ITEM 1.    Business

BUSINESS

Overview

        We are a REIT with a geographically diverse portfolio of seniors housing and healthcare properties throughout the United States and Canada. As of December 31, 2011, we owned 1,378 properties located in 46 states, the District of Columbia and two Canadian provinces, consisting of: 678 seniors housing communities; 396 skilled nursing facilities; 47 hospitals; 249 MOBs; and eight personal care facilities. We also were in the process of developing three properties as of December 31, 2011. We are headquartered in Chicago, Illinois and have been a constituent member of the S&P 500® Index, a leading indicator of the large cap U.S. equities market, since March 2009.

        Our primary business focuses on acquiring and owning seniors housing and healthcare properties and leasing those properties to unaffiliated tenants or operating those properties through independent third-party managers. Through our Lillibridge Healthcare Services, Inc. ("Lillibridge") subsidiary and our ownership interest in PMB Real Estate Services LLC ("PMBRES"), which we acquired in July 2011 in connection with our acquisition of NHP, we also provide MOB management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make mortgage loan and other investments relating to seniors housing and healthcare operators or properties.

        As of December 31, 2011, we leased 929 properties (excluding MOBs) to healthcare operating companies under "triple-net" or "absolute-net" leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures, and we engaged independent third parties, such as Atria and Sunrise, to manage 200 seniors housing communities pursuant to long-term management agreements.

        Ventas was incorporated in Kentucky in 1983, commenced operations in 1985 and reorganized as a Delaware corporation in 1987. We currently operate through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. See our Consolidated Financial Statements and the related notes, including "Note 2—Accounting Policies," included in Part II, Item 8 of this Annual Report on Form 10-K.

Business Strategy

        Our business strategy focuses on three principal objectives: (1) generating consistent, reliable and growing cash flows; (2) maintaining a well-diversified portfolio; and (3) preserving our financial strength, flexibility and liquidity.

        We strive to enhance shareholder value by generating consistent, reliable and growing cash flows from our seniors housing and healthcare assets. To achieve this objective, we endeavor to balance our portfolio through a combination of long-term triple-net leases that provide steady contractual growth, seniors housing operating assets that allow for greater growth potential than our fixed rent escalators, and MOBs that provide stable cash flows.

        We believe that maintaining a portfolio of properties and mortgage loan and other investments diversified by asset class, tenant/operator/manager, geographic location, revenue source and business model makes us less susceptible to regional economic downturns and adverse changes in regulation or

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reimbursement rates or methodologies in any single state or with respect to any particular asset type. Portfolio diversification also reduces our exposure to any individual tenant/operator/manager and diminishes the risk that a single event could materially harm our business.

        A strong, flexible balance sheet and excellent liquidity position us favorably to create and exploit growth opportunities through acquisitions, investments and development projects. We intend to maintain our financial strength and invest profitably by actively managing our leverage, lowering our cost of capital and preserving our access to multiple sources of liquidity, such as unsecured bank debt, mortgage financings and the public debt and equity markets.

2011 Highlights and Recent Developments

        Over the last twelve months, we have completed several significant transactions and financing activities, including without limitation the following:

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Portfolio of Properties and Other Investments

        As of December 31, 2011, we had ownership interests in 1,378 seniors housing and healthcare properties as follow:

 
  Consolidated
(100% interest)
  Consolidated
(<100% interest)
  Unconsolidated
(5% - 25% interest)
  Total  

Seniors housing communities

    640     18     20     678  

Skilled nursing facilities

    382         14     396  

Hospitals

    47             47  

MOBs

    180     11     58     249  

Personal care facilities

    8             8  
                   

Total

    1,257     29     92     1,378  
                   

        Through Lillibridge and PMBRES, we also provided management and leasing services to third parties with respect to 44 MOBs as of December 31, 2011.

        The following table provides an overview of our consolidated portfolio of properties and other investments, excluding development projects, as of and for the year ended December 31, 2011:

Portfolio by Type
  # of
Properties(1)
  # of
Beds/
Units(2)
  Revenue(3)   Percent of
Total
Revenues
  Real Estate
Property
Investments,
at Cost
  Percent of
Real
Estate
Property
Investments
  Real Estate
Property
Investment
Per
Bed/Unit
  Number
of
States/
Provinces(4)
 
 
  (Dollars in thousands)
 

Seniors Housing and Healthcare Properties

                                                 

Seniors housing communities

    658     56,025   $ 1,169,885     65.9 % $ 11,969,153     67.1 % $ 213.6     46  

Skilled nursing facilities

    382     44,020     261,106     14.7     2,994,082     16.8     68.0     40  

Hospitals

    47     3,822     103,571     5.8     482,083     2.7     126.1     17  

MOBs(5)

    191         167,003     9.4     2,377,811     13.3     nm     24  

Personal care facilities

    8     122     1,025     0.1     7,133     0.1     58.5     1  
                                       

Total seniors housing and healthcare properties

    1,286     103,989     1,702,590     95.9 % $ 17,830,262     100.0 %         49  
                                           

Other Investments

                                                 

Loans and investments

                34,415     1.9                          
                                               

              $ 1,737,005     97.8 %(6)                        
                                               

nm—not
meaningful. 

(1)
Excludes 20 seniors housing communities, fourteen skilled nursing facilities and 58 MOBs included in investments in unconsolidated entities.

(2)
Seniors housing communities are measured in units; skilled nursing facilities, hospitals and personal care facilities are measured by bed count; and MOBs are measured by square footage.

(3)
Revenues relate to the actual period of ownership and do not necessarily reflect a full year.

(4)
As of December 31, 2011, our consolidated properties were located in 46 states, the District of Columbia and two Canadian provinces and, excluding MOBs, were operated or managed by 95 different third-party healthcare operating companies, including the following publicly traded companies: Kindred (198 properties); Brookdale (167 properties); Sunrise (79 properties); Emeritus Corporation (17 properties); Assisted Living Concepts, Inc. (12 properties), Capital Senior Living, Inc. (11 properties) and Sun Healthcare Group, Inc. (5 properties).

(5)
As of December 31, 2011, 64 of our MOBs were managed by 11 different third-party managers, 100 of our MOBs were managed by Lillibridge or PMBRES and 27 of our MOBs were leased pursuant to triple-net leases.

(6)
The remainder of our total revenues is medical office building and other services revenue and interest and other income. Revenues from properties held for sale as of December 31, 2011 are included in this presentation. Revenues from properties sold during 2011 are excluded from this presentation.

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        Seniors Housing Communities.    Our seniors housing communities include independent and assisted living communities, continuing care retirement communities and communities providing care for individuals with Alzheimer's disease and other forms of dementia or memory loss. These communities offer studio, one bedroom and two bedroom residential units on a month-to-month basis primarily to elderly individuals requiring various levels of assistance. Basic services for residents of these communities include housekeeping, meals in a central dining area and group activities organized by the staff with input from the residents. More extensive care and personal supervision, at additional fees, are also available for such needs as eating, bathing, grooming, transportation, limited therapeutic programs and medication administration, which allow residents certain conveniences and enable them to live as independently as possible according to their abilities. These services are often met by home health providers, close coordination with the resident's physician and skilled nursing facilities. Charges for room, board and services are generally paid from private sources.

        Skilled Nursing Facilities.    Our skilled nursing facilities provide rehabilitative, restorative, skilled nursing and medical treatment for patients and residents who do not require the high technology, care-intensive, high cost setting of an acute care or rehabilitation hospital. Treatment programs include physical, occupational, speech, respiratory and other therapies, including sub-acute clinical protocols such as wound care and intravenous drug treatment. Charges for these services are generally paid from a combination of government reimbursement and private sources.

        Hospitals.    Substantially all of our hospitals are operated as long-term acute care hospitals, which have a Medicare average length of stay greater than 25 days and serve medically complex, chronically ill patients who require a high level of monitoring and specialized care, but whose conditions do not necessitate the continued services of an intensive care unit. The operators of these hospitals have the capability to treat patients who suffer from multiple systemic failures or conditions such as neurological disorders, head injuries, brain stem and spinal cord trauma, cerebral vascular accidents, chemical brain injuries, central nervous system disorders, developmental anomalies and cardiopulmonary disorders. Chronic patients often depend on technology for continued life support, such as mechanical ventilators, total parenteral nutrition, respiration or cardiac monitors and dialysis machines, and, due to their severe medical conditions, generally are not clinically appropriate for admission to a nursing facility or rehabilitation hospital. All of our long-term acute care hospitals are freestanding facilities, and we do not own any "hospitals within hospitals." We also own two hospitals focused on providing children's care and five rehabilitation hospitals devoted to the rehabilitation of patients with various neurological, musculoskeletal, orthopedic and other medical conditions following stabilization of their acute medical issues.

        Medical Office Buildings.    Our MOBs are typically multi-tenant properties leased to several different unrelated medical practices, although they can be associated with a large single specialty or multi-specialty group. Tenants include physicians, dentists, psychologists, therapists and other healthcare providers, with space devoted to patient examination and treatment, diagnostic imaging, outpatient surgery and other outpatient services. While MOBs are similar to commercial office buildings, they require more plumbing, electrical and mechanical systems to accommodate physicians' requirements such as sinks in every room, brighter lights and specialized medical equipment. As of December 31, 2011, we owned or managed more than 14 million square feet of MOBs, a significant majority of which are "on campus," meaning on or near an acute care hospital campus.

        Personal Care Facilities.    Our personal care facilities provide specialized care, including supported living services, neurorehabilitation, neurobehavioral management and vocational programs, for persons with acquired or traumatic brain injury.

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        As of December 31, 2011, we had $276.2 million of net loans receivable relating to seniors housing and healthcare operators or properties. See "Note 6—Loans Receivable" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K. In addition, we had marketable debt securities classified as available-for-sale and having an aggregate amortized cost basis of $41.2 million and a fair value of $43.3 million as of December 31, 2011.

        Our portfolio of seniors housing and healthcare properties is broadly diversified by geography throughout the United States and Canada, with properties in only one state (California) accounting for more than 10% of our total revenues for the year ended December 31, 2011.

        The following table shows our rental income and resident fees and services derived by geographic location for the year ended December 31, 2011:

 
  Rental Income and
Resident Fees and
Services(1)
  Percent of Total
Revenues
 
 
  (Dollars in thousands)
 

Geographic Location

             

California

  $ 242,622     13.7 %

New York

    154,143     8.7  

Illinois

    113,497     6.4  

Massachusetts

    88,264     5.0  

Texas

    88,003     5.0  

Pennsylvania

    76,600     4.3  

Florida

    67,157     3.8  

New Jersey

    62,617     3.5  

Colorado

    55,139     3.1  

Connecticut

    51,578     2.9  

Other (36 states and the District of Columbia)

    610,946     34.3  
           

Total U.S

    1,610,566     90.7 %

Canada (two Canadian provinces)

    92,024     5.2  
           

Total

  $ 1,702,590     95.9 %(2)
           

(1)
Revenues relate to the actual period of ownership and do not necessarily reflect a full year.

(2)
The remainder of our total revenues is medical office building and other services revenue, income from loans and investments and interest and other income. Revenues from properties held for sale as of December 31, 2011 are included in this presentation. Revenues from properties sold during 2011 are excluded from this presentation.

        As of December 31, 2011, we operated through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. See "Note 20—Segment Information" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for more information about our business segments and the geographic diversification of our portfolio of properties.

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        Our skilled nursing facilities and hospitals are generally subject to federal, state and local licensure statutes and statutes that may require regulatory approval, in the form of a certificate of need ("CON") issued by a governmental agency with jurisdiction over healthcare facilities, prior to the expansion of existing facilities, construction of new facilities, addition of beds, acquisition of major equipment or introduction of new services. CON requirements, which are not uniform throughout the United States, may restrict our or our operators' ability to expand our properties in certain circumstances.

        The following table shows our rental income for the year ended December 31, 2011 derived by skilled nursing facilities and hospitals in states with and without CON requirements:

 
  Skilled
Nursing
Facilities
  Hospitals   Total  

States with CON requirements

    70.2 %   45.9 %   63.3 %

States without CON requirements

    29.8     54.1     36.7  
               

Total

    100.0 %   100.0 %   100.0 %
               

Significant Tenants, Operators and Managers

        As of December 31, 2011, Atria, Sunrise, Brookdale Senior Living and Kindred operated or managed, as applicable, approximately 19.0%, 14.4%, 13.0% and 5.0%, respectively, of our real estate investments based on their gross book value (including amounts held for sale as of December 31, 2011).

        The following table shows the percentage of our revenues and net operating income ("NOI"—defined as total revenues, less interest and other income, property-level operating expenses and medical office building services costs) for the year ended December 31, 2011 (including amounts in discontinued operations) received by or attributed to our top triple-net lease tenants and our senior living operations managed by independent third parties:

 
  Number of
Properties
Operated,
Managed or
Leased
  Percentage of
Revenues
  Percentage of
NOI
 

Senior living operations(1)

    200     49.2 %   24.3 %

Kindred

    198     14.3     23.2  

Brookdale Senior Living(2)

    167     8.2     13.4  

(1)
Amounts attributable to senior living operations managed by Atria relate to the period from May 12, 2011, the date of the ASLG acquisition, through December 31, 2011.

(2)
Excludes six properties included in investments in unconsolidated entities.

        Each of our master lease agreements with Kindred (the "Kindred Master Leases") and our leases with Brookdale Senior Living is a triple-net lease that obligates the tenant to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures, and to comply with the terms of the mortgage financing documents, if any, affecting the properties. In addition, each of these leases have guaranty and cross-default provisions tied to other leases with the same tenant, as well as bundled lease renewals (as described in more detail below).

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        Because the properties we lease to Kindred and Brookdale Senior Living account for a significant portion of our revenues and NOI, our financial condition and results of operations could be weakened and our ability to service our indebtedness and to make distributions to our stockholders could be limited if either Kindred or Brookdale Senior Living were unable or unwilling to satisfy its obligations to us or to renew its leases with us upon expiration of the terms thereof. We cannot provide any assurance that Kindred and Brookdale Senior Living will have sufficient assets, income and access to financing to enable them to satisfy their respective obligations to us, and any inability or unwillingness by Kindred or Brookdale Senior Living to do so could have a material adverse effect on our business, financial condition, results of operations and liquidity, on our ability to service our indebtedness and other obligations and on our ability to make distributions to our stockholders, as required for us to continue to qualify as a REIT (a "Material Adverse Effect"). We also cannot provide any assurance that Kindred and Brookdale Senior Living will elect to renew their respective leases with us upon expiration of their terms or that we will be able to reposition any properties that are not renewed on a timely basis or on the same or better economic terms, if at all. See "Risks Factors—Risks Arising from Our Business—We depend on Kindred and Brookdale Senior Living for a significant portion of our revenues and operating income; Any inability or unwillingness by Kindred or Brookdale Senior Living to satisfy its obligations under its agreements with us could have a Material Adverse Effect on us" included in Item 1A of this Annual Report on Form 10-K.

        Kindred Master Leases.    The aggregate annual rent we receive under each Kindred Master Lease is referred to as "base rent." Base rent escalates on May 1 of each year at a specified rate over the prior period base rent, contingent upon the satisfaction of specified facility revenue parameters. The annual rent escalator under three of our four Kindred Master Leases is 2.7%, and the annual rent escalator under the fourth Kindred Master Lease is based on year-over-year changes in CPI, subject to a floor of 2.25% and a ceiling of 4%. Assuming the applicable facility revenue parameters are met, we currently expect that base rent due under the Kindred Master Leases for the period from May 1, 2012 through April 30, 2013 will be approximately $261.5 million. See "Note 3—Concentration of Credit Risk" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

        The 197 properties we lease to Kindred pursuant to the Kindred Master Leases are grouped into bundles or renewal groups (each, a "renewal group") containing a varying number of properties. All properties within a single renewal group have the same primary lease term of ten to fifteen years (commencing May 1, 1998), and each renewal group is subject to three successive five-year renewal terms at the tenant's option, provided certain conditions are satisfied.

        The current lease term for ten renewal groups covering a total of 89 properties leased to Kindred (the "Renewal Assets") will expire on April 30, 2013 unless Kindred provides us with renewal notices with respect to one or more of those bundles on or before April 30, 2012. In November 2011, we received renewal notices from Kindred with respect to two renewal groups covering a total of sixteen Renewal Assets (the "Early Renewal Assets") and collectively representing approximately $23 million of current annual base rent. In December 2011, we initiated a fair market rental reset process with respect to certain Early Renewal Assets. While we believe that aggregate annual base rent for those Early Renewal Assets is likely to increase as a result of the reset process, we cannot provide any assurance regarding the final determination of fair market rent, which is highly speculative and may be influenced by a variety of factors. In addition, in certain cases Kindred may have the right to revoke its renewal of those Early Renewal Assets for which we initiated the fair market rental reset process.

        The remaining eight renewal groups covering a total of 73 Renewal Assets collectively represent approximately $99 million of current annual base rent, and each renewal group contains six or more properties, including at least one hospital. Kindred is required to continue to perform all of its obligations under the applicable Kindred Master Lease for the Renewal Assets within any renewal group that is not renewed until expiration of the term on April 30, 2013, including without limitation

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payment of all rental amounts. Therefore, as to any renewal group for which we do not receive a renewal notice, we will have at least one year to arrange for the repositioning of the applicable Renewal Assets with new operators. Moreover, we own or have the rights to all licenses and CONs at the properties, and Kindred has extensive and detailed obligations to cooperate and ensure an orderly transition of the properties to another operator.

        We cannot provide any assurance that Kindred will elect to renew any or all of the remaining eight renewal groups whose lease expires April 30, 2013, that Kindred will not revoke its renewal of the Early Renewal Assets for which we initiated the fair market rental reset process, or that we will be able to reposition any or all non-renewed assets on a timely basis or on the same or better economic terms, if at all. See "Risk Factors—Risks Arising from Our Business—If we must replace any of our tenants or operators, we might be unable to reposition the properties on as favorable terms, or at all, and we could be subject to delays, limitations and expenses, which could have a Material Adverse Effect on us" included in Item 1A of this Annual Report on Form 10-K.

        The current lease term for 108 properties leased to Kindred pursuant to the Kindred Master Leases and not comprising the Renewal Assets will expire on April 30, 2015, subject to Kindred's two sequential five-year renewal options for those assets.

        Brookdale Senior Living Leases.    Our leases with Brookdale Senior Living have primary terms of fifteen years (commencing in 2004) and are subject to two successive renewal terms of either five or ten years each at the tenant's option, provided certain conditions are satisfied.

        Under the terms of our leases with Brookdale Senior Living that we assumed in connection with our acquisition of Provident Senior Living Trust ("Provident") in 2005, Brookdale Senior Living is obligated to pay base rent, which escalates on January 1 or November 1 of each year by an amount equal to the lesser of (i) four times the percentage increase in CPI during the immediately preceding year or (ii) either 2.5% or 3%, depending on the lease. Under the terms of the lease with respect to our remaining "Grand Court" property (as described in more detail below), Brookdale Senior Living is obligated to pay base rent, which escalates on February 1 of each year by an amount equal to the greater of (i) 2% or (ii) 75% of the increase in CPI during the immediately preceding year. In February 2012, we sold nine of our original ten "Grand Court" properties to Brookdale Senior Living for aggregate consideration of $121.3 million, including a lease termination fee of $1.8 million. The current aggregate annual contractual cash base rent due to us from Brookdale Senior Living for 2012, excluding variable interest that Brookdale Senior Living is obligated to pay as additional rent based on certain floating rate mortgage debt assumed by us in the Provident acquisition, is approximately $158.1 million (excluding properties included in investments in unconsolidated entities and properties held for sale as of December 31, 2011). The current aggregate annual contractual base rent (computed in accordance with U.S. generally accepted accounting principles ("GAAP")) due to us from Brookdale Senior Living for 2012, excluding the variable interest, is approximately $161.2 million (excluding properties included in investments in unconsolidated entities and properties held for sale as of December 31, 2011). See "Note 3—Concentration of Credit Risk" and "Note 14—Commitments and Contingencies" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

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        As of December 31, 2011, Atria and Sunrise, collectively, provided comprehensive property management and accounting services with respect to 197 of our seniors housing communities for which we pay an annual management fee pursuant to long-term management agreements. Each management agreement with Atria has a term of ten years commencing in 2011, subject to successive automatic ten-year renewal periods, and each management agreement with Sunrise has a term of 30 years commencing as early as 2004. Under the Sunrise management agreements, our management fee was reduced to 3.75% of revenues generated by the applicable properties for 2011, but will revert to 6% of revenues generated by the applicable properties (with a range of 5% to 7%) for 2012 and thereafter. See "Note 3—Concentration of Credit Risk" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

        Because Atria and Sunrise manage, but do not lease, our properties, we are not directly exposed to their credit risk in the same manner or to the same extent as our triple-net tenants. However, we rely on our managers' personnel, good faith, expertise, historical performance, technical resources and information systems, proprietary information and judgment to manage our seniors housing communities efficiently and effectively. We also rely on our managers to set resident fees and otherwise operate those properties in compliance with the terms of our management agreements. Although we have various rights as the property owner under our management agreements, Atria's or Sunrise's inability or unwillingness to satisfy its obligations under those agreements, to efficiently and effectively manage our properties or to provide timely and accurate accounting information with respect thereto could have a Material Adverse Effect on us. In addition, significant changes in Atria's or Sunrise's senior management or any adverse developments in their businesses and affairs or financial condition could have a Material Adverse Effect on us. See "Risk Factors—Risks Arising from Our Business—The properties managed by Atria and Sunrise account for a significant portion of our revenues and operating income; Although Atria and Sunrise are managers, not tenants, of our properties, adverse developments in their businesses and affairs or financial condition could have a Material Adverse Effect on us" included in Item 1A of this Annual Report on Form 10-K.

Competition

        We generally compete in the acquisition, leasing and financing of seniors housing and healthcare properties with publicly traded, private and non-listed healthcare REITs, real estate partnerships, healthcare providers, healthcare lenders and other investors, including without limitation developers, banks, insurance companies, pension funds, government sponsored entities and private equity firms. Some of our competitors may have greater financial resources and lower costs of capital than we do. Increased competition makes it more challenging for us to identify and successfully capitalize on opportunities that meet our objectives, as our ability to compete in those areas is affected by, among other factors, the availability of suitable acquisition or investment targets, our ability to negotiate acceptable acquisition or investment terms and our access to and cost of capital. See "Risk Factors—Risks Arising from Our Business—Our pursuit of investments in, and acquisitions or development of, seniors housing and healthcare assets may be unsuccessful or fail to meet our expectations" included in Item 1A of this Annual Report on Form 10-K and "Note 10—Borrowing Arrangements" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

        The tenants and managers that operate our properties compete on a local and regional basis with healthcare operating companies that provide comparable services. The operators and managers of our seniors housing communities, skilled nursing facilities and hospitals compete to attract and retain residents and patients based on scope and quality of care, reputation and financial condition, price, location and physical appearance of the properties, services offered, qualified personnel, physician referrals and family preferences. The managers of our MOBs compete to attract and retain tenants based on many of the same factors, in addition to quality of the affiliated health system, physician

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preferences and proximity to hospital campuses. The ability of our tenants and managers to compete successfully could be affected by private, federal and state reimbursement programs and other laws and regulations. See "Risk Factors—Risks Arising from Our Business—Our tenants, operators and managers may be adversely affected by increasing healthcare regulation and enforcement" and "—Changes in the reimbursement rates or methods of payment from third-party payors, including the Medicare and Medicaid programs, could have a material adverse effect on certain of our tenants and operators" included in Item 1A of this Annual Report on Form 10-K.

Employees

        As of December 31, 2011, we had 328 employees, none of whom is subject to a collective bargaining agreement.

Insurance

        We maintain and/or require in our lease, management and other agreements that our tenants, operators and managers maintain all applicable lines of insurance on our properties and their operations. We believe that the amount and scope of insurance coverage provided by our policies and the policies maintained by our tenants, operators and managers are customary for similarly situated companies in our industry. Although we believe that our tenants, operators and managers are in compliance with their respective insurance requirements, we cannot provide any assurance that they will maintain the required insurance coverages, and the failure by any of them to do so could have a Material Adverse Effect on us. We also cannot provide any assurance that we will continue to require the same levels of insurance coverage under our lease, management and other agreements, that such insurance will be available at a reasonable cost in the future or that the insurance coverage provided will fully cover all losses on our properties upon the occurrence of a catastrophic event, nor can we make any guaranty as to the future financial viability of the insurers.

        We maintain property and casualty insurance for our senior living operations, and we maintain general and professional liability insurance for our seniors housing communities and related operations managed by Atria. The general and professional liability insurance for our seniors housing communities and related operations managed by Sunrise is currently maintained by Sunrise in accordance with the standards contained in our management agreements. Under our management agreements with Sunrise, we may elect, on an annual basis, whether we or Sunrise will bear responsibility for maintaining the required insurance coverage for the applicable properties, but the costs of such insurance are facility expenses paid from the revenues of those properties, regardless of who maintains the insurance.

        As part of our MOB development business, we provide engineering, construction and architectural services, and any design, construction or systems failures related to the properties we develop could result in substantial injury or damage to clients or third parties. Any such injury or damage claims may arise in the ordinary course and may be asserted with respect to ongoing or completed projects. Although we maintain liability insurance to protect us against these claims, if any claim results in a loss, we cannot provide any assurance that our policy limits would be adequate to cover the loss in full. If we sustain losses in excess of our insurance coverage, we may be required to pay the difference and we could lose our investment in, and/or experience reduced profits and cash flows from, the affected MOB, which could have a Material Adverse Effect on us.

        In an effort to reduce and manage their costs and for various other reasons, many companies in the healthcare industry, including some of our tenants, operators and managers, are pursuing different organizational and corporate structures coupled with self-insurance trusts or programs (commonly referred to as "captives") that may provide them with less insurance coverage. As a result, those companies who self-insure could incur large funded and unfunded professional liability expenses, which could have a material adverse effect on their liquidity, financial condition and results of operations.

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The implementation of a trust or captive by any of our tenants, operators or managers could adversely affect such person's ability to satisfy its obligations under, or otherwise comply with the terms of, its respective lease, management and other agreements with us, which could have a Material Adverse Effect on us. Likewise, if we decide to implement a captive, any large funded and unfunded professional liability expenses that we incur could have a Material Adverse Effect on us.

Additional Information

        We maintain a website at www.ventasreit.com. The information on our website is not incorporated by reference in this Annual Report on Form 10-K, and our web address is included as an inactive textual reference only.

        We make available, free of charge, through our website our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13 or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. In addition, our Guidelines on Governance, our Code of Ethics and Business Conduct and the charters for each of our Audit and Compliance, Nominating and Corporate Governance and Executive Compensation Committees are available on our website, and we will mail copies of the foregoing documents to stockholders, free of charge, upon request to our Corporate Secretary at Ventas, Inc., 10350 Ormsby Park Place, Suite 300, Louisville, Kentucky 40223.


GOVERNMENTAL REGULATION

Healthcare Regulation

        While the properties within our portfolio are all susceptible to many varying types of regulation, we expect that the healthcare industry, in general, will continue to face increased regulation and pressure in the areas of fraud, waste and abuse, cost control, healthcare management and provision of services, among others. A significant expansion of applicable federal, state or local laws and regulations, previously enacted or future healthcare reform, new interpretations of existing laws and regulations or changes in enforcement priorities could have a material adverse effect on certain of our operators' liquidity, financial condition and results of operations and, in turn, their ability to satisfy their contractual obligations, including making rental payments under, or otherwise complying with the terms of, their leases with us. In addition, efforts by third-party payors, such as the federal Medicare program, state Medicaid programs and private insurance carriers, including health maintenance organizations and other health plans, to impose greater discounts and more stringent cost controls upon operators (through changes in reimbursement rates and methodologies, discounted fee structures, the assumption by healthcare providers of all or a portion of the financial risk or otherwise) are expected to intensify and continue. Significant limits on the scope of services reimbursed and on reimbursement rates and fees could also have a material adverse effect on certain of our operators' liquidity, financial condition and results of operations and, in turn, their ability to satisfy their contractual obligations, including making rental payments under, and otherwise complying with the terms of, their leases with us.

        Participation in the Medicare and Medicaid programs generally requires the operators of our skilled nursing facilities to be licensed on an annual or bi-annual basis and certified annually through various regulatory agencies that determine compliance with federal, state and local laws. These legal requirements relate to the quality of the nursing care provided, qualifications of the administrative personnel and nursing staff, the adequacy of the physical plant and equipment and continuing compliance with the laws and regulations governing the operation of skilled nursing facilities. The

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failure of an operator to maintain or renew any required license or regulatory approval or to correct serious deficiencies identified in compliance surveys could prevent it from continuing operations at a property. A loss of licensure or certification could also adversely affect a skilled nursing facility operator's ability to receive payments from the Medicare and Medicaid programs, which, in turn, could affect adversely their ability to satisfy their contractual obligations, including making rental payments under, and otherwise complying with the terms of, their leases with us.

        Similarly, in order to receive Medicare and Medicaid reimbursement, our hospitals must meet the applicable conditions of participation set forth by the U.S. Department of Health and Human Services ("HHS") relating to the type of hospital and its equipment, personnel and standard of medical care, as well as comply with state and local laws and regulations. Hospitals undergo periodic on-site licensure surveys, which generally are limited if the hospital is accredited by The Joint Commission (formerly the Joint Commission on Accreditation of Healthcare Organizations) or other recognized accreditation organizations. A loss of licensure or certification could adversely affect a hospital's ability to receive payments from the Medicare and Medicaid programs, which, in turn, could adversely affect their ability to satisfy their contractual obligations, including making rental payments under, and otherwise complying with the terms of, their leases with us.

        Seniors housing communities are subject to relatively few, if any, federal regulations. Instead, to the extent they are regulated, the regulation is conducted mainly by state and local laws governing licensure, provision of services, staffing requirements and other operational matters. These laws vary greatly from one jurisdiction to another. Although recent growth in the U.S. seniors housing industry has attracted the attention of various federal agencies that believe more federal regulation of these properties is necessary, thus far, Congress has deferred to state regulation of seniors housing communities. However, as a result of this growth and increased federal scrutiny, some states have revised and strengthened their regulation of seniors housing communities, and more states are expected to do the same in the future.

CONs

        Skilled nursing facilities and hospitals are subject to various state CON laws requiring governmental approval prior to the development or expansion of healthcare facilities and services. The approval process in these states generally requires a facility to demonstrate the need for additional or expanded healthcare facilities or services. CONs, where applicable, are also sometimes necessary for changes in ownership or control of licensed facilities, addition of beds, investment in major capital equipment, introduction of new services or termination of services previously approved through the CON process. CON laws and regulations may restrict an operator's ability to expand our properties and grow its business in certain circumstances, which could have an adverse effect on the operator's revenues and, in turn, its ability to make rental payments under, and otherwise comply with the terms of, its leases with us. In addition, in the event that any operator of our properties fails to make rental payments to us or to comply with applicable healthcare regulations, our ability to evict that operator and substitute another operator for a particular facility may be materially delayed or limited by CON laws, as well as by various state licensing and receivership laws and Medicare and Medicaid change-of-ownership rules. Such delays and limitations could have a material adverse effect on our ability to collect rent, to obtain possession of leased properties, or otherwise to exercise remedies for tenant default. We may also incur substantial additional expenses in connection with any such licensing, receivership or change-of-ownership proceedings.

Fraud and Abuse

        Various federal and state laws and regulations prohibit a wide variety of fraud and abuse by healthcare providers who participate in, receive payments from or make or receive referrals for work in

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connection with government-funded healthcare programs, including Medicare and Medicaid. The federal laws include, by way of example, the following:

        Sanctions for violating these federal laws include criminal and civil penalties such as punitive sanctions, damage assessments, monetary penalties, imprisonment, denial of Medicare and Medicaid payments, and/or exclusion from the Medicare and Medicaid programs. These laws also impose an affirmative duty on operators to ensure that they do not employ or contract with persons excluded from the Medicare and other government programs.

        Many states have adopted or are considering legislative proposals similar to the federal anti-fraud and abuse laws, some of which extend beyond the Medicare and Medicaid programs, to prohibit the payment or receipt of remuneration for the referral of patients and physician self-referrals, regardless of whether the service was reimbursed by Medicare or Medicaid. Many states have also adopted or are considering legislative proposals to increase patient protections, such as minimum staffing levels, criminal background checks, and limiting the use and disclosure of patient specific health information. These state laws also impose criminal and civil penalties similar to the federal laws.

        In the ordinary course of their business, the operators of our properties have been and are subject regularly to inquiries, investigations and audits by federal and state agencies that oversee applicable laws and regulations. Increased funding through recent federal and state legislation has led to significant growth in the number of investigations and enforcement actions over the past several years. Private enforcement of healthcare fraud has also increased, due in large part to amendments to the civil False Claims Act in 1986 that were designed to encourage private individuals to sue on behalf of the government. These whistleblower suits by private individuals, known as qui tam suits, may be filed by almost anyone, including present and former patients or nurses and other employees. HIPAA also created a series of new healthcare crimes.

        As federal and state budget pressures persist, administrative agencies may continue to escalate their investigation and enforcement efforts to eliminate waste and to control fraud and abuse in governmental healthcare programs. A violation of any federal or state anti-fraud and abuse laws or regulations by an operator of our properties could have a material adverse effect on the operator's liquidity, financial condition or results of operations, which could adversely affect its ability to satisfy its

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contractual obligations, including making rental payments under, and otherwise complying with the terms of, its leases and other agreements with us.

Healthcare Legislation

        In March 2010, President Obama signed into law the Patient Protection and Affordable Care Act, along with a reconciliation measure, the Health Care and Education Reconciliation Act of 2010 (collectively, the "Affordable Care Act"). The passage of the Affordable Care Act has resulted in comprehensive reform legislation that is expected to expand health care coverage to millions of currently uninsured people beginning in 2014. To help fund this expansion, the Affordable Care Act outlines certain reductions in Medicare reimbursement rates for various healthcare providers, including long-term acute care hospitals and skilled nursing facilities, as well as certain other changes to Medicare payment methodologies.

        The Affordable Care Act, among other things, reduced the inflationary market basket increase included in standard federal payment rates for long-term acute care hospitals by 25 basis points in fiscal year 2010, 50 basis points in fiscal year 2011, 10 basis points in fiscal years 2012 and 2013, 30 basis points in fiscal year 2014, 20 basis points in fiscal years 2015 and 2016, and 75 basis points in fiscal years 2017 through 2019. In addition, under the Affordable Care Act, long-term acute care hospitals and skilled nursing facilities are subject to a rate adjustment to the market basket increase, beginning in fiscal year 2012, to reflect improvements in productivity. The constitutionality of various provisions of the Affordable Care Act is being considered by the U.S. Supreme Court. In addition to the constitutionality of the so-called individual mandate, the U.S. Supreme Court is considering the constitutionality of provisions that expand Medicaid coverage to include individuals who would otherwise not be eligible and whether those provisions, if declared unconstitutional, can be severed from the rest of the Affordable Care Act. Oral argument on these matters has been scheduled for March 2012 with a decision likely by the end of June 2012.

        Healthcare is one of the largest industries in the United States and continues to attract a great deal of legislative interest and public attention. We cannot provide any assurance that previously enacted or future healthcare reform legislation or changes in the administration or implementation of governmental and non-governmental healthcare reimbursement programs will not have a material adverse effect on our operators' liquidity, financial condition or results of operations, or on their ability to satisfy their obligations to us, which, in turn, could have a Material Adverse Effect on us.

Medicare Reimbursement; Long-Term Acute Care Hospitals

        The Balanced Budget Act of 1997 ("BBA") mandated the creation of a prospective payment system for long-term acute care hospitals ("LTAC PPS") for cost reporting periods commencing on or after October 1, 2002. Under LTAC PPS, which classifies patients into distinct diagnostic groups based on clinical characteristics and expected resource needs, long-term acute care hospitals are reimbursed on a predetermined rate, rather than on a reasonable cost basis that reflects costs incurred. LTAC PPS requires payment for a Medicare beneficiary at a predetermined, per discharge amount for each defined patient category (called "Long-Term Care—Diagnosis Related Groups" or "LTC-DRGs"), adjusted for differences in area wage levels.

        Updates to LTAC PPS payment rates are established by regulators and published annually for the long-term acute care hospital rate year, which coincides with annual updates to the LTC-DRG classification system and corresponds to the federal fiscal year (October 1 through September 30).

        The Medicare, Medicaid, and SCHIP Extension Act of 2007 (Pub. L. No. 110-173) (the "Medicare Extension Act") significantly expanded medical necessity reviews by the Centers for Medicare & Medicaid Services ("CMS") by requiring long-term acute care hospitals to institute a patient review process to better assess patients upon admission and on a continuing basis for appropriateness of care.

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In addition, the Medicare Extension Act, among other things, provided the following long-term acute care hospital payment policy changes, all of which were extended for two years by the Affordable Care Act:

        Lastly, the Medicare Extension Act introduced a moratorium on new long-term acute care hospitals and beds for three years.

        In a final rule published in May 2008, CMS delayed the extension of the 25-percent rule to freestanding and grandfathered long-term acute care hospitals and increased the patient percentage thresholds for certain urban and rural long-term acute care "hospitals-within-hospitals" and "satellite" facilities for three years, as mandated by the Medicare Extension Act. The rule also set forth policies on implementing the moratorium on new long-term acute care hospitals and beds imposed by the Medicare Extension Act.

        In a final rule published in August 2009, CMS finalized policies to implement changes required by Section 124 of the Medicare Improvements for Patients & Providers Act of 2008 (Pub. L. No. 110-275), continuing reforms intended to improve the accuracy of Medicare payments for inpatient acute care through the severity-adjusted diagnosis-related group (MS-LTC-DRG) classification system for long-term acute care hospitals.

        On August 18, 2011, CMS published its final rule updating LTAC PPS for the 2012 fiscal year (October 1, 2011 through September 30, 2012). Under the rule, the LTAC PPS standard federal payment rate will increase by 1.8% in fiscal year 2012, reflecting a 2.9% increase in the market basket index, less a 1% productivity adjustment and the additional 10 basis point reduction required by the Affordable Care Act. As a result, CMS estimates that net payments to long-term acute care hospitals in fiscal year 2012 under the final rule will increase relative to fiscal year 2011 by approximately $126 million, or 2.5%, due to area wage adjustments, as well as increases in high-cost and short-stay outlier payments and other policies adopted in the final rule.

        In addition, as a result of the enactment of the Budget Control Act of 2011 and subsequent events, which are discussed below, Medicare payments to long-term acute care hospitals will be reduced by 2% on January 2, 2013.

        We regularly assess the financial implications of CMS's rules on the operators of our long-term acute care hospitals, but we cannot provide any assurance that the current rules or future updates to LTAC PPS, LTC-DRGs or Medicare reimbursement for long-term acute care hospitals will not materially adversely affect our operators, which, in turn, could have a Material Adverse Effect on us. See "Risk Factors—Risks Arising from Our Business—Changes in the reimbursement rates or methods of payment from third-party payors, including the Medicare and Medicaid programs, could have a material adverse effect on certain of our tenants and operators" included in Item 1A of this Annual Report on Form 10-K.

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Medicare Reimbursement; Skilled Nursing Facilities

        The BBA also mandated the creation of a prospective payment system for skilled nursing facilities ("SNF PPS") offering Part A covered services. Under SNF PPS, payment amounts are based upon classifications determined through assessments of individual Medicare patients in the skilled nursing facility, rather than on the facility's reasonable costs. SNF PPS payments are made on a per diem basis for each resident and are generally intended to cover all inpatient services for Medicare patients, including routine nursing care, most capital-related costs associated with the inpatient stay, and ancillary services, such as respiratory therapy, occupational and physical therapy, speech therapy and certain covered drugs.

        In response to widespread healthcare industry concern about the reductions in payments under the BBA, the federal government enacted the Balanced Budget Refinement Act of 1999 ("BBRA"). The BBRA increased the per diem reimbursement rates for certain high acuity patients by 20% from April 1, 2000 until case mix refinements were implemented by CMS, as explained below. The BBRA also imposed a two-year moratorium on the annual cap mandated by the BBA on physical, occupational and speech therapy services provided to a patient by outpatient rehabilitation therapy providers, including Part B covered therapy services in nursing facilities. Relief from the BBA therapy caps was subsequently extended multiple times by Congress, but these extensions expired on December 31, 2009 and have not been renewed by Congress.

        Pursuant to its final rule updating SNF PPS for the 2006 fiscal year, CMS refined the resource utilization groups ("RUGs") used to determine the daily payment for beneficiaries in skilled nursing facilities by adding nine new payment categories, the result of which was to eliminate the temporary add-on payments that Congress enacted as part of the BBRA.

        Under its final rule updating LTC-DRGs for the 2007 fiscal year, CMS reduced reimbursement of uncollectible Medicare coinsurance amounts for all beneficiaries (other than beneficiaries of both Medicare and Medicaid) from 100% to 70% for skilled nursing facility cost reporting periods beginning on or after October 1, 2005. The rule also included various options for classifying and weighting patients transferred to a skilled nursing facility after a hospital stay less than the mean length of stay associated with that particular diagnosis-related group.

        Under its final rule updating SNF PPS for the 2010 fiscal year, CMS recalibrated the case-mix indexes for RUGs used to determine the daily payment for beneficiaries in skilled nursing facilities and implemented the RUG-IV classification model for skilled nursing facilities for the 2011 fiscal year. However, the Affordable Care Act delayed the implementation of RUG-IV for one year, and CMS subsequently modified the implementation schedule in its notice updating SNF PPS for the 2011 fiscal year.

        In November 2010, CMS placed on public display its final Medicare Physician Fee Schedule rule for the 2011 calendar year, which set a $1,870 cap on physical therapy and speech-language pathology services and a separate $1,870 cap on occupational therapy services, including therapy provided in skilled nursing facilities, both without an exceptions process. In December 2010, the Medicare and Medicaid Extenders Act of 2010 (Pub. L. No. 111 309) was enacted to lift the caps on therapy services and continue the exceptions process.

        On August 8, 2011, CMS published its final rule updating SNF PPS for the 2012 fiscal year (October 1, 2011 through September 30, 2012). Under the rule, the update to the SNF PPS standard federal payment rate includes a 2.7% increase in the market basket index, less a 1.0% productivity adjustment mandated by the Affordable Care Act and a 12.6% "parity adjustment recalibration" to account for estimated overpayments under the RUG-IV classification model, resulting in a net 11.1% decrease in the SNF PPS standard federal payment rate for fiscal year 2012. The rule also requires group therapy to be treated in the same manner as concurrent therapy (i.e., allocating therapy minutes

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among the group's patients, rather than counting the same minutes for each patient), which may additionally affect net payments to skilled nursing facilities. CMS estimates that net payments to skilled nursing facilities as a result of the final rule will decrease by approximately $3.87 billion in fiscal year 2012, but stated that "Even with the recalibration, the FY 2012 payment rates will be 3.4 percent higher than the rates established for FY 2010, the period immediately preceding the unintended spike in payment levels."

        In addition, as a result of the enactment of the Budget Control Act of 2011 and subsequent events, which are discussed below, Medicare payments to skilled nursing facilities will be reduced by 2% on January 2, 2013.

        We regularly assess the financial implications of CMS's rules on the operators of our skilled nursing facilities, but we cannot provide any assurance that the current rules or future updates to SNF PPS, therapy services or Medicare reimbursement for skilled nursing facilities will not materially adversely affect our operators, which, in turn, could have a Material Adverse Effect on us. See "Risk Factors—Risks Arising from Our Business—Changes in the reimbursement rates or methods of payment from third-party payors, including the Medicare and Medicaid programs, could have a material adverse effect on certain of our tenants and operators" included in Item 1A of this Annual Report on Form 10-K.

Medicaid Reimbursement; Skilled Nursing Facilities

        Approximately two-thirds of all nursing home residents are dependent on Medicaid. Medicaid reimbursement rates, however, typically are less than the amounts charged by the operators of our skilled nursing facilities. Although the federal government and the states share responsibility for financing Medicaid, states have a wide range of discretion, within certain federal guidelines, to determine eligibility and reimbursement methodology. In addition, federal legislation limits an operator's ability to withdraw from the Medicaid program by restricting the eviction or transfer of Medicaid residents. As state budget pressures continue to escalate and in an effort to address actual or potential budget shortfalls, many state legislatures have enacted or proposed reductions to Medicaid expenditures by implementing "freezes" or cuts in Medicaid rates paid to providers, including hospitals and skilled nursing facilities, or by restricting eligibility and benefits.

        In the Deficit Reduction Act of 2005 (Pub. L. No. 109 171), Congress made changes to the Medicaid program that were estimated to result in $10 billion in savings to the federal government over the five years following enactment of the legislation, primarily through the accounting practices some states use to calculate their matched payments and revising the qualifications for individuals who are eligible for Medicaid benefits. The changes made by CMS's final rule updating SNF PPS for the 2006 fiscal year were also anticipated to reduce Medicaid payments to skilled nursing facility operators, and as part of the Tax Relief and Health Care Act of 2006 (Pub. L. No. 109-432), Congress reduced the ceiling on taxes that states may impose on healthcare providers and that would qualify for federal financial participation under Medicaid by 0.5%, from 6% to 5.5%, until October 1, 2011. While it was anticipated that this reduction would have a negligible effect, impacting only those states with taxes in excess of 5.5%, we have not ascertained its financial implications on our skilled nursing facility operators.

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        In contrast, the American Recovery and Reinvestment Act of 2009 (Pub. L. No. 111-5) (the "Recovery Act"), temporarily increased federal payments to state Medicaid programs by $86.6 billion through, among other things, a 6.2% increase in the federal share of Medicaid expenditures across the board, with additional funds available depending on a state's federal medical assistance percentage and unemployment rate. Though the Medicaid federal assistance payments were originally expected to expire on December 31, 2010, the President's fiscal year 2011 budget extended those payments through June 30, 2011. The Recovery Act also requires states to promptly pay nursing facilities under their Medicaid program, and precludes states, as a condition of receiving the additional funding, from heightening their Medicaid eligibility requirements.

        We expect more states to adopt significant Medicaid rate freezes or cuts or other program changes as their reimbursement methodologies continue to evolve. In addition, the U.S. government may revoke, reduce or stop approving "provider taxes" that have the effect of increasing Medicaid payments to the states. We cannot predict what impact these actions would have on the operators of our skilled nursing facilities, and we cannot provide any assurance that payments under Medicaid are now or in the future will be sufficient to fully reimburse those operators for the cost of providing skilled nursing services. Severe and widespread Medicaid rate cuts or freezes could materially adversely affect our skilled nursing facility operators, which, in turn, could adversely affect their ability to satisfy their contractual obligations, including making rental payments under, and otherwise complying with the terms of, their leases with us.

Debt Ceiling and Deficit Reduction Legislation

        On August 2, 2011, President Obama and the U.S. Congress enacted the Budget Control Act of 2011 to increase the federal government's borrowing authority (the so-called "debt ceiling") and reduce the federal government's projected operating deficit. To implement this legislation, President Obama and members of the U.S. Congress have proposed various spending cuts and tax reform initiatives, some of which could result in changes (including substantial reductions in funding) to Medicare, Medicaid or Medicare Advantage Plans. Under the agreement reached to allow the federal government to raise the debt ceiling in August, a twelve-member, bipartisan committee was given a deadline of November 23, 2011 to develop recommendations for reducing the federal budget deficit by a total of at least $1.2 trillion over ten years. However, the committee was not able to agree on a plan and, therefore, $1.2 trillion in automatic spending cuts, including a 2% reduction in Medicare payments to long-term acute care hospitals and skilled nursing facilities, as noted above, are expected to go into effect on January 2, 2013. These measures and any future federal legislation relating to the debt ceiling or deficit reduction could have a material adverse effect on our operators' liquidity, financial condition or results of operations, which could adversely affect their ability to satisfy their obligations to us and which, in turn, could have a Material Adverse Effect on us.

Environmental Regulation

        As an owner of real property, we are subject to various federal, state and local laws and regulations regarding environmental, health and safety matters. These laws and regulations address, among other things, asbestos, polychlorinated biphenyls, fuel oil management, wastewater discharges, air emissions, radioactive materials, medical wastes, and hazardous wastes, and in certain cases, the costs of complying with these laws and regulations and the penalties for non-compliance can be substantial. Even with respect to properties that we do not operate or manage, we may be held primarily or jointly and severally liable for costs relating to the investigation and clean-up of any property from which there is or has been an actual or threatened release of a regulated material and any other affected properties, regardless of whether we knew of or caused the release. Such costs typically are not limited by law or regulation and could exceed the property's value. In addition, we may be liable for certain other costs, such as governmental fines and injuries to persons, property or

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natural resources, as a result of any such actual or threatened release. See "Risk Factors—Risks Arising from Our Business—If any of our properties are found to be contaminated, or if we become involved in any environmental disputes, we could incur substantial liabilities and costs" included in Item 1A of this Annual Report on Form 10-K.

        Under the terms of our lease and management agreements, we generally have a right to indemnification by the tenants, operators and managers of our properties for any contamination caused by them. However, we cannot provide any assurance that our tenants, operators and managers will have the financial capability or willingness to satisfy their respective indemnification obligations to us, and any such inability or unwillingness to do so may require us to satisfy the underlying environmental claims. See "Risk Factors—Risks Arising from Our Business—We depend on Kindred and Brookdale Senior Living for a significant portion of our revenues and operating income; Any inability or unwillingness by Kindred or Brookdale Senior Living to satisfy its obligations under its agreements with us could have a Material Adverse Effect on us" included in Item 1A of this Annual Report on Form 10-K.

        In general, we have also agreed to indemnify our tenants against any environmental claims (including penalties and clean-up costs) resulting from any condition arising in, on or under, or relating to, the leased properties at any time before the applicable lease commencement date. With respect to our senior living operating portfolio, we have agreed to indemnify our managers against any environmental claims (including penalties and clean-up costs) resulting from any condition on those properties, unless the manager caused or contributed to that condition.

        We did not make any material capital expenditures in connection with environmental, health, and safety laws, ordinances and regulations in 2011 and do not expect that we will be required to make any such material capital expenditures during 2012.


CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS

        The following discussion summarizes certain U.S. federal income tax considerations that you may deem relevant as a holder of our common stock. It is not tax advice, nor does it purport to address all aspects of U.S. federal income taxation that may be important to particular stockholders in light of their personal circumstances or to certain types of stockholders that may be subject to special rules, such as insurance companies, tax-exempt organizations (except to the extent discussed below under "—Treatment of Tax-Exempt Stockholders"), financial institutions, pass-through entities (or investors in such entities) or broker-dealers, and non-U.S. individuals and entities (except to the extent discussed below under "—Special Tax Considerations for Non-U.S. Stockholders").

        The statements in this section are based on the Internal Revenue Code of 1986, as amended (the "Code"), U.S. Treasury Regulations and administrative and judicial interpretations thereof. The laws governing the U.S. federal income tax treatment of REITs and their stockholders are highly technical and complex, and this discussion is qualified in its entirety by the authorities listed above, as in effect on the date hereof. We cannot provide any assurance that new laws, interpretations of law or court decisions, any of which may take effect retroactively, will not cause any statement herein to be inaccurate.

Federal Income Taxation of Ventas

        We elected REIT status beginning with the year ended December 31, 1999. Beginning with the 1999 tax year, we believe that we have satisfied the requirements to qualify as a REIT, and we intend to continue to qualify as a REIT for federal income tax purposes. If we continue to qualify for taxation as a REIT, we generally will not be subject to federal income tax on net income that we currently distribute to stockholders. This treatment substantially eliminates the "double taxation" (i.e., taxation at both the corporate and stockholder levels) that generally results from investment in a corporation.

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        Notwithstanding such qualification, we will be subject to federal income tax on any undistributed taxable income, including undistributed net capital gains, at regular corporate rates. In addition, we will be subject to a 4% excise tax if we do not satisfy specific REIT distribution requirements. See "—Requirements for Qualification as a REIT—Annual Distribution Requirements." Under certain circumstances, we may be subject to the "alternative minimum tax" on our undistributed items of tax preference. If we have net income from the sale or other disposition of "foreclosure property" (see below) held primarily for sale to customers in the ordinary course of business or certain other non-qualifying income from foreclosure property, we will be subject to tax at the highest corporate rate on that income. See "—Requirements for Qualification as a REIT—Asset Tests." In addition, if we have net income from "prohibited transactions" (which are, in general, certain sales or other dispositions of property (other than foreclosure property) held primarily for sale to customers in the ordinary course of business), that income will be subject to a 100% tax.

        We may also be subject to "Built-in Gains Tax" on any appreciated asset that we own or acquire that was previously owned by a C corporation (i.e., a corporation generally subject to full corporate-level tax). If we dispose of any such asset and recognize gain on the disposition during the ten-year period immediately after the asset was owned by a C corporation (either prior to our REIT election, or through stock acquisition or merger), then we generally will be subject to regular corporate income tax on the gain equal to the lesser of the recognized gain at the time of disposition or the built-in gain in that asset as of the date it became a REIT asset.

        In addition, if we fail to satisfy either of the gross income tests for qualification as a REIT (as discussed below), but still maintain such qualification under the relief provisions of the Code, we will be subject to a 100% tax on the gross income attributable to the amount by which we failed the applicable test, multiplied by a fraction intended to reflect our profitability. If we violate one or more of the REIT asset tests (as discussed below), we may avoid a loss of our REIT status if we qualify under certain relief provisions and, among other things, pay a tax equal to the greater of $50,000 or the highest corporate tax rate multiplied by the net income generated by the non-qualifying asset during a specified period. If we fail to satisfy any requirement for REIT qualification, other than the gross income or assets tests mentioned above, but nonetheless maintain such qualification by meeting certain other requirements, we may be subject to a $50,000 penalty for each failure. Finally, we will incur a 100% excise tax on the income derived from certain transactions with a taxable REIT subsidiary (including rental income derived from leasing properties to a taxable REIT subsidiary) that are not conducted on an arm's-length basis.

        See "—Requirements for Qualification as a REIT" below for other circumstances in which we may be required to pay federal taxes.

Requirements for Qualification as a REIT

        To qualify as a REIT, we must meet the requirements discussed below relating to our organization, sources of income, nature of assets and distributions of income to stockholders.

        The Code defines a REIT as a corporation, trust or association: (i) that is managed by one or more directors or trustees; (ii) the beneficial ownership of which is evidenced by transferable shares or by transferable certificates of beneficial interest; (iii) that would be taxable as a domestic corporation but for Sections 856 through 859 of the Code; (iv) that is neither a financial institution nor an insurance company subject to certain provisions of the Code; (v) the beneficial ownership of which is held by 100 or more persons during at least 335 days of a taxable year of twelve months, or during a proportionate part of a shorter taxable year (the "100 Shareholder Rule"); (vi) not more than 50% in value of the outstanding stock of which is owned, directly or indirectly, by five or fewer individuals (as

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defined in the Code to include certain entities) during the last half of each taxable year (the "5/50 Rule"); (vii) that makes an election to be a REIT (or has made such election for a previous taxable year) and satisfies all relevant filing and other administrative requirements established by the Internal Revenue Service ("IRS") that must be met in order to elect and to maintain REIT status; (viii) that uses a calendar year for federal income tax purposes; and (ix) that meets certain other tests, described below, regarding the nature of its income and assets.

        We believe but cannot provide any assurance that we have satisfied and will continue to satisfy the organizational requirements for qualification as a REIT. Our certificate of incorporation contains certain restrictions on the transfer of our shares that are intended to prevent a concentration of ownership of our stock that would cause us to fail the 5/50 Rule or the 100 Shareholder Rule; however, we cannot provide any assurance as to the effectiveness of these restrictions.

        In addition, to qualify as a REIT, a corporation may not have (as of the end of the taxable year) any earnings and profits that were accumulated in periods before it elected REIT status or that are from acquired non-REIT corporations. We believe that we have not had any accumulated earnings and profits that are attributable to non-REIT periods or from acquired corporations that were not REITs, although the IRS is entitled to challenge that determination.

        We must satisfy two annual gross income requirements to qualify as a REIT:

        We believe but cannot provide any assurance that we have been and will continue to be in compliance with the gross income tests described above. If we fail to satisfy one or both gross income tests for any taxable year, we may nevertheless qualify as a REIT for that year if we qualify under certain relief provisions of the Code, in which case we would be subject to a 100% tax on the income exceeding one or both of the gross income tests. If we fail to satisfy one or both of the gross income tests and do not qualify under the relief provisions for any taxable year, we will not qualify as a REIT for that year, which would have a Material Adverse Effect on us.

        At the close of each quarter of our taxable year, we must satisfy the following tests relating to the nature of our assets:

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        In addition, no more than 25% of the value of our assets (20% for taxable years beginning prior to 2009) can be represented by securities of taxable REIT subsidiaries (the "25% TRS test").

        We believe but cannot provide any assurance that we have been and will continue to be in compliance with the asset tests described above. If we fail to satisfy the asset tests at the end of any quarter, we may nevertheless continue to qualify as a REIT if we satisfied all of the asset tests at the close of the preceding calendar quarter and the discrepancy between the value of our assets and the asset test requirements is due to changes in the market values of our assets and not caused in any part by an acquisition of non-qualifying assets.

        Furthermore, if we fail to satisfy any of the asset tests at the end of any calendar quarter without curing such failure within 30 days after the end of such quarter, we would fail to qualify as a REIT unless we qualified under certain relief provisions enacted as part of the American Jobs Creation Act of 2004. Under one relief provision, we would continue to qualify as a REIT if our failure to satisfy the 5% asset test, the 10% voting securities test or the 10% value test is due to the ownership of assets having a total value not exceeding the lesser of 1% of our assets at the end of the relevant quarter or $10 million and we disposed of such assets (or otherwise met such asset tests) within six months after the end of the quarter in which the failure was identified. If we fail to satisfy any of the asset tests for a particular quarter but do not qualify under the relief provision described in the preceding sentence, then we would be deemed to have satisfied the relevant asset test if: (i) following identification of the failure, we filed a schedule with a description of each asset that caused the failure; (ii) the failure is due to reasonable cause and not willful neglect; (iii) we disposed of the non-qualifying asset (or otherwise met the relevant asset test) within six months after the end of the quarter in which the failure was identified; and (iv) we paid a penalty tax equal to the greater of $50,000 or the highest corporate tax rate multiplied by the net income generated by the non-qualifying asset during the period beginning on the first date of the failure and ending on the date we disposed of the asset (or otherwise cured the asset test failure). We cannot predict, however, whether in all circumstances we would be entitled to the benefit of these relief provisions. If we fail to satisfy any of the asset tests and do not qualify for the relief provisions, we will lose our REIT status, which would have a Material Adverse Effect on us.

        The foreclosure property rules permit us (by our election) to foreclose or repossess properties without being disqualified as a REIT as a result of receiving income that does not qualify under the gross income tests. However, in that case, we would be subject to a corporate tax on the net non-qualifying income from "foreclosure property," and the after-tax amount would increase the dividends we would be required to distribute to stockholders. See "—Annual Distribution Requirements" below. The corporate tax imposed on non-qualifying income would not apply to income that does qualify as "good REIT income," such as a lease of qualified healthcare property to a taxable REIT subsidiary, where the taxable REIT subsidiary engages an eligible independent contractor to manage and operate the property.

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        Foreclosure property treatment will end on the first day on which we enter into a lease of the applicable property that will give rise to income that does not constitute "good REIT income" under Section 856(c)(3) of the Code, but such treatment will not end if the lease will only give rise to "good REIT income." In addition, foreclosure property treatment will end if any construction takes place on the property (other than completion of a building or other improvement more than 10% complete before default became imminent). Foreclosure property treatment (other than for qualified healthcare property) is available for an initial period of three years and may, in certain circumstances, be extended for an additional three years. Foreclosure property treatment for qualified healthcare property is available for an initial period of two years and may, in certain circumstances, be extended for an additional four years.

        A taxable REIT subsidiary, or "TRS," is a corporation subject to tax as a regular C corporation. Generally, a TRS can own assets that cannot be owned by a REIT and can perform tenant services (excluding the direct or indirect operation or management of a lodging or healthcare facility) that would otherwise disqualify the REIT's rental income under the gross income tests. Also, notwithstanding general restrictions on related party rent, a REIT can lease healthcare properties to a TRS if the TRS does not manage or operate the healthcare facilities and instead engages an "eligible independent contractor" to manage the healthcare facilities. We are permitted to own up to 100% of a TRS, subject to the 25% TRS test, but there are certain limits on the ability of a TRS to deduct interest payments made to us. In addition, we are subject to a 100% penalty tax on any excess payments that we receive or any excess expenses deducted by the TRS if the economic arrangements between the REIT, the REIT's tenants and the TRS are not comparable to similar arrangements among unrelated parties.

        In order to be taxed as a REIT, we are required to distribute dividends (other than capital gain dividends) to our stockholders in an amount at least equal to the sum of (i) 90% of our "REIT taxable income" (computed without regard to the dividends paid deduction and our net capital gain) and (ii) 90% of the net income (after tax), if any, from foreclosure property, minus the sum of certain items of non-cash income. These dividends must be paid in the taxable year to which they relate, or in the following taxable year if (i) they are declared in October, November or December, payable to stockholders of record on a specified date in any one of those months and actually paid during January of such following year or (ii) they are declared before we timely file our tax return for such year and paid on or before the first regular dividend payment after such declaration, and we elect on our federal income tax return for the prior year to have a specified amount of the subsequent dividend treated as paid in the prior year. To the extent we do not distribute all of our net capital gain or at least 90%, but less than 100%, of our "REIT taxable income," as adjusted, we will be subject to tax on the undistributed amount at regular capital gains and ordinary corporate tax rates except to the extent of our net operating loss or capital loss carryforwards. If we pay any Built-in Gains Taxes, those taxes will be deductible in computing REIT taxable income. Moreover, if we fail to distribute during each calendar year (or, in the case of distributions with declaration and record dates falling in the last three months of the calendar year, by the end of January following such calendar year) at least the sum of 85% of our REIT ordinary income for such year, 95% of our REIT capital gain net income for such year (other than long-term capital gain we elect to retain and treat as having been distributed to stockholders), and any undistributed taxable income from prior periods, we will be subject to a 4% nondeductible excise tax on the excess of such required distribution over the amounts actually distributed.

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        We believe but cannot provide any assurance that we have satisfied the annual distribution requirements for the year of our initial REIT election and each year thereafter through the year ended December 31, 2011. Although we intend to satisfy the annual distribution requirements to continue to qualify as a REIT for the year ending December 31, 2012 and subsequent years, economic, market, legal, tax or other considerations could limit our ability to meet those requirements.

        In Revenue Procedure 2010-12, the IRS stated that it would treat stock dividends as distributions for purposes of satisfying the REIT distribution requirements for calendar years 2008 through 2012, provided that stockholders can elect to receive the distribution in either cash or stock, subject to certain limitations. Any stock so distributed would be taxable to the recipient. We may choose to declare stock dividends in accordance with Revenue Procedure 2010-12 or otherwise. We also have net operating loss carryforwards that we can use to reduce our annual distribution requirements. See "Note 13—Income Taxes" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

        If we fail to satisfy one or more requirements for REIT qualification, other than by violating a gross income or asset test for which relief is otherwise available as described above, we would retain our REIT qualification if the failure is due to reasonable cause and not willful neglect and if we pay a penalty of $50,000 for each such failure. We cannot predict, however, whether in all circumstances we would be entitled to the benefit of this relief provision.

        If our election to be taxed as a REIT is revoked or terminated (e.g., due to a failure to meet the REIT qualification tests without qualifying for any applicable relief provisions), we would be subject to tax (including any applicable alternative minimum tax) on our taxable income at regular corporate rates (for all open tax years beginning with the year our REIT election is revoked or terminated), and distributions to stockholders would not be deductible by us, nor would they be required to be made. To the extent of current and accumulated earnings and profits, all distributions to stockholders would be taxable as ordinary income (except to the extent such dividends are eligible for the qualified dividends rate generally available to non-corporate holders), and, subject to certain limitations in the Code, corporate stockholders may be eligible for the dividends received deduction. In addition, we would be prohibited from re-electing REIT status for the four taxable years following the year during which we ceased to qualify as a REIT, unless certain relief provisions of the Code applied. We cannot predict, however, whether we would be entitled to such relief.

Federal Income Taxation of U.S. Stockholders

        As used herein, the term "U.S. Stockholder" refers to any beneficial owner of our common stock that is, for U.S. federal income tax purposes, an individual who is a citizen or resident of the United States, a corporation created or organized in or under the laws of the United States, any state thereof or the District of Columbia, an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source, or a trust if (i) a U.S. court is able to exercise primary supervision over the administration of such trust and one or more U.S. persons have authority to control all substantial decisions of the trust or (ii) the trust has elected under applicable U.S. Treasury Regulations to retain its pre-August 20, 1996 classification as a U.S. person. If an entity treated as a partnership for U.S. federal income tax purposes holds our common stock, the tax treatment of a partner in the partnership will generally depend on the status of the partner and the activities of the partnership. Partners of partnerships holding our stock should consult their tax advisors. This section assumes the U.S. Stockholder holds our common stock as a capital asset.

        As long as we qualify as a REIT, distributions made to our taxable U.S. Stockholders out of current or accumulated earnings and profits (and not designated as capital gain dividends) generally

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will be taxable to such U.S. Stockholders as ordinary income and will not be eligible for the qualified dividends rate generally available to non-corporate holders or for the dividends received deduction generally available to corporations. Distributions that are designated as capital gain dividends will be taxed as a long-term capital gain (to the extent such distributions do not exceed our actual net capital gain for the taxable year) without regard to the period for which the stockholder has held its shares. Distributions in excess of current and accumulated earnings and profits will not be taxable to a U.S. Stockholder to the extent they do not exceed the adjusted basis of the stockholder's shares (determined on a share-by-share basis), but rather will reduce the adjusted basis of those shares. To the extent that distributions in excess of current and accumulated earnings and profits exceed the adjusted basis of a stockholder's shares, such distributions will be included in income as capital gains. The tax rate applicable to such capital gains will depend on the stockholder's holding period for the shares. Any distribution declared by us and payable to a stockholder of record on a specified date in October, November or December of any year will be treated as both paid by us and received by the stockholder on December 31 of that year, provided that we actually pay the distribution during January of the following calendar year.

        We may elect to treat all or a part of our undistributed net capital gain as if it had been distributed to our stockholders. If we make such an election, our stockholders would be required to include in their income as long-term capital gain their proportionate share of our undistributed net capital gain, as designated by us. Each such stockholder would be deemed to have paid its proportionate share of the income tax imposed on us with respect to such undistributed net capital gain, and this amount would be credited or refunded to the stockholder. In addition, the tax basis of the stockholder's shares would be increased by its proportionate share of undistributed net capital gains included in its income, less its proportionate share of the income tax imposed on us with respect to such gains.

        Stockholders may not include in their individual income tax returns any of our net operating losses or net capital losses. Instead, we would carry over those losses for potential offset against our future income, subject to certain limitations. Taxable distributions from us and gain from the disposition of our common stock will not be treated as passive activity income, and, therefore, stockholders generally will not be able to apply any "passive activity losses" (such as losses from certain types of limited partnerships in which the stockholder is a limited partner) against such income. In addition, taxable distributions from us generally will be treated as investment income for purposes of the investment interest limitations.

        We will notify stockholders after the close of our taxable year as to the portions of the distributions attributable to that year that constitute ordinary income, return of capital and capital gain. To the extent a portion of the distribution is designated as a capital gain dividend, we will notify stockholders as to the portion that is a "15% rate gain distribution" and the portion that is an unrecaptured Section 1250 distribution. A 15% rate gain distribution is a capital gain distribution to domestic stockholders that are individuals, estates or trusts that is taxable at a maximum rate of 15%. An unrecaptured Section 1250 gain distribution would be taxable to taxable domestic stockholders that are individuals, estates or trusts at a maximum rate of 25%.

        In general, a U.S. Stockholder who is not a dealer in securities must treat any gain or loss realized upon a taxable disposition of our common stock as long-term capital gain or loss if the stockholder has held the shares for more than one year, and otherwise as short-term capital gain or loss. However, a U.S. Stockholder must treat any loss upon a sale or exchange of shares of our common stock held for six months or less as a long-term capital loss to the extent of capital gain dividends and any other actual or deemed distributions from us which the stockholder treats as long-term capital gain. All or a portion of any loss that a U.S. Stockholder realizes upon a taxable disposition of our common stock

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may be disallowed if the stockholder purchases other shares of our common stock (or certain options to acquire our common stock) within 30 days before or after the disposition.

        Tax-exempt organizations, including qualified employee pension and profit sharing trusts and individual retirement accounts (collectively, "Exempt Organizations"), generally are exempt from U.S. federal income taxation. However, they are subject to taxation on their unrelated business taxable income ("UBTI"). While many investments in real estate generate UBTI, the IRS has issued a published ruling that dividend distributions by a REIT to an exempt employee pension trust do not constitute UBTI, provided that the shares of the REIT are not otherwise used in an unrelated trade or business of the exempt employee pension trust. Based on that ruling, and subject to the exceptions discussed below, amounts distributed by us to Exempt Organizations generally should not constitute UBTI. However, if an Exempt Organization finances its acquisition of our common stock with debt, a portion of its income from us will constitute UBTI pursuant to the "debt-financed property" rules. Furthermore, social clubs, voluntary employee benefit associations, supplemental unemployment benefit trusts and qualified group legal services plans that are exempt from taxation under paragraphs (7), (9), (17) and (20), respectively, of Section 501(c) of the Code are subject to different UBTI rules, which generally require them to characterize distributions from us as UBTI. In addition, in certain circumstances, a pension trust that owns more than 10% of our stock is required to treat a percentage of the dividends from us as UBTI.

Special Tax Considerations for Non-U.S. Stockholders

        As used herein, the term "Non-U.S. Stockholder" refers to any beneficial owner of our common stock that is, for U.S. federal income tax purposes, a nonresident alien individual, foreign corporation, foreign estate or foreign trust, but does not include any foreign stockholder whose investment in our stock is "effectively connected" with the conduct of a trade or business in the United States. Such a foreign stockholder, in general, will be subject to U.S. federal income tax with respect to its investment in our stock in the same manner as a U.S. Stockholder (subject to applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals). In addition, a foreign corporation receiving income that is treated as effectively connected with a U.S. trade or business also may be subject to an additional 30% "branch profits tax" on its effectively connected earnings and profits (subject to adjustments) unless an applicable tax treaty provides a lower rate or an exemption. Certain certification requirements must be satisfied in order for effectively connected income to be exempt from withholding.

        Distributions to Non-U.S. Stockholders that are not attributable to gain from sales or exchanges by us of U.S. real property interests and are not designated by us as capital gain dividends (or deemed distributions of retained capital gains) will be treated as dividends of ordinary income to the extent that they are made out of our current or accumulated earnings and profits. Such distributions ordinarily will be subject to a withholding tax equal to 30% of the gross amount of the distribution unless an applicable tax treaty reduces or eliminates that tax. Distributions in excess of our current and accumulated earnings and profits will not be taxable to a Non-U.S. Stockholder to the extent that such distributions do not exceed the adjusted basis of the stockholder's shares (determined on a share-by-share basis), but rather will reduce the adjusted basis of those shares. To the extent that distributions in excess of current and accumulated earnings and profits exceed the adjusted basis of a Non-U.S. Stockholder's shares, such distributions will give rise to tax liability if the Non-U.S. Stockholder would otherwise be subject to tax on any gain from the sale or disposition of its shares, as described below.

        We expect to withhold U.S. tax at the rate of 30% on the gross amount of any dividends, other than dividends treated as attributable to gain from sales or exchanges of U.S. real property interests

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and capital gain dividends, paid to a Non-U.S. Stockholder, unless (i) a lower treaty rate applies and the required IRS Form W-8BEN evidencing eligibility for that reduced rate is filed with us or the appropriate withholding agent or (ii) the Non-U.S. Stockholder files an IRS Form W-8ECI or a successor form with us or the appropriate withholding agent properly claiming that the distributions are effectively connected with the Non-U.S. Stockholder's conduct of a U.S. trade or business.

        For any year in which we qualify as a REIT, distributions to a Non-U.S. Stockholder that owns more than 5% of our common shares at any time during the one-year period ending on the date of distribution and that are attributable to gain from sales or exchanges by us of U.S. real property interests will be taxed to the Non-U.S. Stockholder under the provisions of the Foreign Investment in Real Property Tax Act of 1980 ("FIRPTA") as if such gain were effectively connected with a U.S. business. Accordingly, a Non-U.S. Stockholder that owns more than 5% of our common shares will be taxed at the normal capital gain rates applicable to a U.S. Stockholder (subject to any applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals). Distributions subject to FIRPTA also may be subject to a branch profits tax equal to 30% of its effectively connected earnings and profits (subject to adjustments) if the recipient is a foreign corporate stockholder not entitled to treaty relief or exemption. Under FIRPTA, we are required to withhold 35% (which is higher than the maximum rate on long-term capital gains of non-corporate persons) of any distribution to a Non-U.S. Stockholder that owns more than 5% of our common shares which is or could be designated as a capital gain dividend attributable to U.S. real property interests. Moreover, if we designate previously made distributions as capital gain dividends attributable to U.S. real property interests, subsequent distributions (up to the amount of such prior distributions) will be treated as capital gain dividends subject to FIRPTA withholding. This amount is creditable against the Non-U.S. Stockholder's FIRPTA tax liability.

        If a Non-U.S. Stockholder does not own more than 5% of our common shares at any time during the one-year period ending on the date of a distribution, any capital gain distributions, to the extent attributable to sales or exchanges by us of U.S. real property interests, will not be considered to be effectively connected with a U.S. business, and the Non-U.S. Stockholder would not be required to file a U.S. federal income tax return by receiving such a distribution. In that case, the distribution will be treated as a REIT dividend to that Non-U.S. Stockholder and taxed as a REIT dividend that is not a capital gain distribution (and subject to possible withholding), as described above. In addition, the branch profits tax will not apply to the distribution. Any capital gain distribution, to the extent not attributable to sales or exchanges by us of U.S. real property interests, generally will not be subject to U.S. federal income taxation (regardless of the amount of our common shares owned by a Non-U.S. Stockholder). For so long as our common stock continues to be regularly traded on an established securities market, the sale of such stock by any Non-U.S. Stockholder who is not a Five Percent Non-U.S. Stockholder (as defined below) generally will not be subject to U.S. federal income tax (unless the Non-U.S. Stockholder is a nonresident alien individual who was present in the United States for more than 182 days during the taxable year of the sale and certain other conditions apply, in which case such gain (net of certain sources within the U.S., if any) will be subject to a 30% tax on a gross basis). A "Five Percent Non-U.S. Stockholder" is a Non-U.S. Stockholder who, at some time during the five-year period preceding such sale or disposition, beneficially owned (including under certain attribution rules) more than 5% of the total fair market value of our common stock (as outstanding from time to time).

        In general, the sale or other taxable disposition of our common stock by a Five Percent Non-U.S. Stockholder also will not be subject to U.S. federal income tax if we are a "domestically controlled REIT." A REIT is a "domestically controlled REIT" if, at all times during the five-year period preceding the disposition in question, less than 50% in value of its shares is held directly or indirectly by Non-U.S. Stockholders. Although we believe that we currently qualify as a domestically controlled REIT, because our common stock is publicly traded, we cannot provide any assurance that we do so qualify or that we will qualify as a domestically controlled REIT at any time in the future. If we do not constitute a domestically controlled REIT, a Five Percent Non-U.S. Stockholder generally will be taxed in the same manner as a U.S. Stockholder with respect to gain on the sale of our common stock (subject to applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals).

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Information Reporting Requirements and Backup Withholding Tax

        Information returns may be filed with the IRS and backup withholding tax may be collected in connection with distributions paid or required to be treated as paid during each calendar year and payments of the proceeds of a sale or other disposition of our common stock. Under the backup withholding rules, a stockholder may be subject to backup withholding at the applicable rate (currently 28% and scheduled to increase to 31% in 2013) with respect to distributions paid and proceeds from a disposition of our common stock unless such holder is a corporation, non-U.S. person or comes within certain other exempt categories and, when required, demonstrates this fact or provides a taxpayer identification number, certifies as to no loss of exemption from backup withholding and otherwise complies with the applicable requirements of the backup withholding rules. A stockholder who does not provide us with its correct taxpayer identification number also may be subject to penalties imposed by the IRS.

        Backup withholding is not an additional tax. Rather, the U.S. federal income tax liability of persons subject to backup withholding tax will be offset by the amount of tax withheld. If backup withholding tax results in an overpayment of U.S. federal income taxes, a refund or credit may be obtained from the IRS, provided the required information is furnished timely thereto.

        As a general matter, backup withholding and information reporting will not apply to a payment of the proceeds of a sale of our common stock by or through a foreign office of a foreign broker. Information reporting (but not backup withholding) will apply, however, to a payment of the proceeds of a sale of our common stock by a foreign office of a broker that is a U.S. person, a foreign partnership that engaged during certain periods in the conduct of a trade or business in the United States or more than 50% of whose capital or profit interests are owned during certain periods by U.S. persons, any foreign person that derives 50% or more of its gross income for certain periods from the conduct of a trade or business in the United States, or a "controlled foreign corporation" for U.S. tax purposes, unless the broker has documentary evidence in its records that the holder is a Non-U.S. Stockholder and certain other conditions are satisfied, or the stockholder otherwise establishes an exemption. Payment to or through a U.S. office of a broker of the proceeds of a sale of our common stock is subject to both backup withholding and information reporting unless the stockholder certifies under penalties of perjury that the stockholder is a Non-U.S. Stockholder or otherwise establishes an exemption. A stockholder may obtain a refund of any amounts withheld under the backup withholding rules in excess of its U.S. federal income tax liability by timely filing the appropriate claim for a refund with the IRS.

Other Tax Consequences

        We and/or our stockholders may be subject to taxation by various states and localities, including those in which we or a stockholder transact business, own property or reside. State and local tax treatment may differ from the federal income tax treatment described above. Consequently, stockholders should consult their own tax advisers regarding the effect of state and local tax laws, in addition to federal, foreign and other tax laws, in connection with an investment in our common stock.

        You should recognize that future legislative, judicial and administrative actions or decisions, which may be retroactive in effect, could adversely affect our federal income tax treatment or the tax consequences of an investment in shares of our common stock. The rules dealing with U.S. federal income taxation are constantly under review by persons involved in the legislative process and by the IRS and the U.S. Treasury Department, resulting in statutory changes as well as promulgation of new, or revisions to existing, regulations and revised interpretations of established concepts.

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        We cannot predict the likelihood of passage of any new tax legislation or other provisions either directly or indirectly affecting us or our stockholders or the value of an investment in our common stock.

ITEM 1A.    Risk Factors

        This section discusses the most significant factors that affect our business, operations and financial condition. It does not describe all risks and uncertainties applicable to us, our industry or ownership of our securities. If any of the following risks, or any other risks and uncertainties that we have not yet identified or that we currently deem not material, actually occur, we could be materially adversely affected. In that event, the value of our securities could decline.

        We have grouped these risk factors into three general categories:

Risks Arising from Our Business

We depend on Kindred and Brookdale Senior Living for a significant portion of our revenues and operating income; Any inability or unwillingness by Kindred or Brookdale Senior Living to satisfy its obligations under its agreements with us could have a Material Adverse Effect on us.

        The properties we lease to Kindred and Brookdale Senior Living account for a significant portion of our revenues and NOI, and since the Kindred Master Leases and our leases with Brookdale Senior Living are triple-net leases, we also depend on Kindred and Brookdale Senior Living to pay all insurance, taxes, utilities and maintenance and repair expenses in connection with the leased properties. We cannot provide any assurance that Kindred and Brookdale Senior Living will have sufficient assets, income and access to financing to enable them to make rental payments to us or to otherwise satisfy those obligations, and any inability or unwillingness by Kindred or Brookdale Senior Living to do so could have a Material Adverse Effect on us. In addition, any failure by Kindred or Brookdale Senior Living to effectively conduct its operations or to maintain and improve our properties could adversely affect its business reputation and its ability to attract and retain patients and residents in our properties, which could have a Material Adverse Effect on us. Kindred and Brookdale Senior Living have also agreed to indemnify, defend and hold us harmless from and against various claims, litigation and liabilities arising in connection with their respective businesses, and we cannot provide any assurance that either Kindred or Brookdale Senior Living will have sufficient assets, income, access to financing and insurance coverage to enable it to satisfy its indemnification obligations.

The properties managed by Atria and Sunrise account for a significant portion of our revenues and operating income; Although Atria and Sunrise are managers, not tenants, of our properties, adverse developments in their businesses and affairs or financial condition could have a Material Adverse Effect on us.

        As of December 31, 2011, Atria and Sunrise, collectively, managed 197 of our seniors housing communities pursuant to long-term management agreements. These properties represent a substantial portion of our portfolio, based on their gross book value, and account for a significant portion of our revenues and NOI. Although we have various rights as the property owner under our management agreements, we rely on Atria's and Sunrise's personnel, good faith, expertise, historical performance, technical resources and information systems, proprietary information and judgment to manage our seniors housing communities efficiently and effectively. We also rely on Atria and Sunrise to set resident fees, to provide accurate property-level financial results for our properties in a timely manner and to otherwise operate our properties in accordance with the terms of our management agreements

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and in compliance with all applicable laws and regulations. For example, we depend on Atria's and Sunrise's ability to attract and retain skilled management personnel who are responsible for the day-to-day operations of our seniors housing communities. A shortage of nurses or other trained personnel or general inflationary pressures may force Sunrise or Atria to enhance its pay and benefits package to compete effectively for such personnel, and Atria or Sunrise may not be able to offset such added costs by increasing the rates charged to residents. Any increase in labor costs and other property operating expenses, any failure by Atria or Sunrise to attract and retain qualified personnel, or significant changes in Atria's or Sunrise's senior management could adversely affect the income we receive from our seniors housing communities and have a Material Adverse Effect on us.

        Because Atria and Sunrise manage, but do not lease, our properties, we are not directly exposed to their credit risk in the same manner or to the same extent as a triple-net tenant. However, any adverse developments in Atria's or Sunrise's business and affairs or financial condition could impair their ability to manage our properties efficiently and effectively and could have a Material Adverse Effect on us. If Atria or Sunrise experiences any significant financial, legal, accounting or regulatory difficulties due to the weakened economy or otherwise, such difficulties could result in, among other adverse events, acceleration of its indebtedness, impairment of its continued access to capital, the enforcement of default remedies by its counterparties, or the commencement of insolvency proceedings by or against it under the U.S. Bankruptcy Code, any one or a combination of which indirectly could have a Material Adverse Effect on us.

We face potential adverse consequences of bankruptcy or insolvency by our tenants, operators, borrowers, managers and other obligors.

        We are exposed to the risk that our tenants, operators, borrowers, managers or other obligors could become bankrupt or insolvent. Although our lease, loan and management agreements provide us with the right to exercise certain remedies in the event of default on the obligations owing to us or upon the occurrence of certain insolvency events, the bankruptcy and insolvency laws afford certain rights to a party that has filed for bankruptcy or reorganization. For example, a debtor-lessee may reject its lease with us in a bankruptcy proceeding. In such a case, our claim against the debtor-lessee for unpaid and future rents would be limited by the statutory cap of the U.S. Bankruptcy Code. This statutory cap could be substantially less than the remaining rent actually owed under the lease, and any claim we have for unpaid rent might not be paid in full. In addition, a debtor-lessee may assert in a bankruptcy proceeding that its lease should be re-characterized as a financing agreement. If such a claim is successful, our rights and remedies as a lender, compared to a landlord, are generally more limited. Similarly, if a debtor-manager seeks bankruptcy protection, the automatic stay provisions of the U.S. Bankruptcy Code would preclude us from enforcing our remedies against the manager unless relief is first obtained from the court having jurisdiction over the bankruptcy case. In the event of an obligor bankruptcy, we may also be required to fund certain expenses and obligations (e.g., real estate taxes, debt costs and maintenance expenses) to preserve the value of our properties, avoid the imposition of liens on our properties or transition our properties to a new tenant, operator or manager.

If we must replace any of our tenants or operators, we might be unable to reposition the properties on as favorable terms, or at all, and we could be subject to delays, limitations and expenses, which could have a Material Adverse Effect on us.

        We cannot predict whether our tenants will renew existing leases beyond their current term. If the Kindred Master Leases, our leases with Brookdale Senior Living or any of our other leases are not renewed, we would attempt to reposition those properties with another tenant or operator. In case of non-renewal, we generally have one year prior to expiration of the lease term to arrange for repositioning of the properties and our tenants are required to continue to perform all of their obligations (including the payment of all rental amounts) for the non-renewed assets until such

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expiration. However, following expiration of a lease term or if we exercise our right to replace a tenant or operator in default, rental payments on the related properties could decline or cease altogether while we reposition the properties with a suitable replacement tenant or operator. We also might not be successful in identifying suitable replacements or entering into leases with new tenants or operators on a timely basis or on terms as favorable to us as our current leases, if at all, and we may be required to fund certain expenses and obligations (e.g., real estate taxes, debt costs and maintenance expenses) to preserve the value of, and avoid the imposition of liens on, our properties while they are being repositioned. In addition, we may incur certain obligations and liabilities, including obligations to indemnify the replacement tenant or operator, which could have a Material Adverse Effect on us.

        Our ability to reposition our properties with a suitable tenant or operator could be significantly delayed or limited by state licensing, receivership, CON or other laws, as well as by the Medicare and Medicaid change-of-ownership rules. We could also incur substantial additional expenses in connection with any licensing, receivership or change-of-ownership proceedings. In addition, our ability to locate suitable replacement tenants could be impaired by the specialized healthcare uses or contractual restrictions on use of the properties, and we may be required to spend substantial amounts to adapt the properties to other uses. Any such delays, limitations and expenses could adversely impact our ability to collect rent, obtain possession of leased properties or otherwise exercise remedies for tenant default and could have a Material Adverse Effect on us.

We have only limited rights to terminate our management agreements with Atria and Sunrise, and we may be unable to replace Atria or Sunrise if our management agreements are terminated or not renewed.

        We are parties to long-term management agreements with each of Atria and Sunrise pursuant to which Atria and Sunrise, collectively, provide comprehensive property management and accounting services with respect to 197 of our seniors housing communities.

        Each management agreement with Atria has a term of ten years commencing in 2011, subject to successive automatic ten-year renewal periods, and each management agreement with Sunrise has a term of 30 years commencing as early as 2004. Each management agreement with Atria or Sunrise may be terminated by us upon the occurrence of an event of default by Atria or Sunrise, respectively, in the performance of a material covenant or term thereof (including, in certain circumstances, the revocation of any license or certificate necessary for operation), subject in most cases to the defaulting party's right to cure such default, or upon the occurrence of certain insolvency events relating to Atria or Sunrise, respectively. In addition, we may terminate each management agreement with Atria based on the failure to achieve certain NOI targets, and we may terminate each management agreement with Sunrise based on the failure to achieve certain NOI targets or to comply with certain expense control covenants. Under certain circumstances, we may also terminate each management agreement with Atria upon the payment of a fee. Notwithstanding the provisions in our management agreements, legal, contractual and other considerations may limit or delay our exercise of any or all of these termination rights.

        In the event that our management agreements with Atria or Sunrise are terminated for any reason or are not renewed upon expiration of their terms, we would attempt to find another manager for the properties covered by those agreements. Although we believe that many qualified national and regional seniors care providers would be interested in managing our seniors housing communities, we cannot provide any assurance that we would be able to locate another suitable manager or, if we are successful in locating such a manager, that it would manage the properties effectively. Moreover, any such replacement manager would require approval by the applicable regulatory authorities and, in most cases, the mortgage lenders for the properties, and we cannot provide any assurance that such approvals would be granted on a timely basis or at all. Any inability or lengthy delay in replacing Atria or Sunrise as manager following termination or non-renewal of our management agreements could have a Material Adverse Effect on us.

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Our significant acquisition activity presents certain risks to our business and operations.

        In 2010 and 2011, we acquired or signed definitive agreements to acquire more than $12 billion of assets, including our acquisitions of Lillibridge, NHP and substantially all of the real estate assets of ASLG and our pending acquisition of Cogdell. Our significant acquisition activity presents certain risks to our business and operations, including, among other things, that:

        We cannot provide any assurance that we will be able to achieve the economic benefit we expect from acquired properties or integrate acquisitions without encountering difficulties or that any such difficulties will not have a Material Adverse Effect on us.

We have now, and may have in the future, exposure to contingent rent escalators, which can hinder our growth and profitability.

        We receive a significant portion of our revenues by leasing our assets under long-term triple-net leases in which the rental rate is generally fixed with annual escalations. Certain of our leases contain escalators contingent upon the achievement of specified revenue parameters or based on changes in the Consumer Price Index. If, as a result of weak economic conditions or other factors, the revenues generated by our triple-net leased properties do not meet the specified parameters or the Consumer Price Index does not increase, our growth and profitability will be hindered by these leases.

We are exposed to various operational risks, liabilities and claims with respect to our operating assets, which could adversely affect our ability to generate revenues or increase our costs and could have a Material Adverse Effect on us.

        We are exposed to various operational risks, liabilities and claims with respect to our senior living and MOB operating assets, which could increase our costs or adversely affect our ability to generate revenues, thereby reducing our profitability. These operational risks include fluctuations in occupancy levels, the inability to achieve economic resident fees (including anticipated increases in those fees), rent control regulations, increases in costs of food, materials, energy, labor (as a result of unionization or otherwise) and other services, national and regional economic conditions, the imposition of new or increased taxes, capital expenditure requirements, professional and general liability claims, and the availability and cost of professional and general liability insurance. Any or a combination of these factors could result in operating deficiencies in our senior living operations or MOB operations reportable business segments, which could have a Material Adverse Effect on us.

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The weakened economy could adversely impact our revenues and operating income, as well as the operating results of our tenants and operators, which could impair their ability to meet their obligations to us.

        Continued concerns about the U.S. economy and the systemic impact of high unemployment, volatile energy costs, geopolitical issues, the availability and cost of credit, the U.S. mortgage market and a severely distressed real estate market have contributed to increased market volatility and weakened business and consumer confidence. If this difficult operating environment continues or worsens, it could increase our costs or adversely affect our ability to generate revenues in our senior living and MOB operations, thereby reducing our operating income or causing us to experience operating deficiencies. It could also have an adverse impact on the ability of our tenants and operators to maintain occupancy and rates in our properties, which could harm their financial condition and impair their ability to make their rental payments and satisfy their other obligations to us, which could have a Material Adverse Effect on us.

Legislation to address the federal government's projected operating deficit could have a material adverse effect on our operators' liquidity, financial condition or results of operations.

        President Obama and members of the U.S. Congress have recently proposed various spending cuts and tax reform initiatives to reduce the federal government's projected operating deficit. Some of these initiatives could result in changes (including substantial reductions in funding) to Medicare, Medicaid or Medicare Advantage Plans. Future federal legislation relating to deficit reduction that reduces reimbursement payments to healthcare providers could have a material adverse effect on our operators' liquidity, financial condition or results of operations, which could adversely affect their ability to satisfy their obligations to us and could have a Material Adverse Effect on us.

We may be unable to successfully foreclose on the collateral securing our mortgage loan investments, and even if we are successful in our foreclosure efforts, we may be unable to successfully reposition the properties, which may adversely affect our ability to recover our investments.

        If a borrower defaults under any of our mortgage loans, to protect our interest, we may foreclose on the loan or acquire title to the property and make substantial improvements or repairs to maximize the property's investment potential. In response to our actions to enforce mortgage obligations, the defaulting borrower may contest enforcement of foreclosure or other remedies, seek bankruptcy protection against our exercise of enforcement or other remedies, or bring claims for lender liability. If the borrower seeks bankruptcy protection, the automatic stay provisions of the U.S. Bankruptcy Code would preclude us from enforcing foreclosure or other remedies against the borrower unless relief is first obtained from the court having jurisdiction over the bankruptcy case. Foreclosure-related costs, high loan-to-value ratios or declines in property value could prevent us from realizing the full amount of our mortgage loans upon foreclosure, and we could be required to record valuation allowance for such losses. Even if we successfully foreclose on the collateral securing our mortgage loan investments, we may inherit properties that we are unable to expeditiously reposition with new tenants or operators, if at all, which would adversely affect our ability to recover our investment.

Our pursuit of investments in, and acquisitions or development of, seniors housing and healthcare assets may be unsuccessful or fail to meet our expectations.

        We intend to continue to pursue investments in, and acquisitions or development of, additional seniors housing and healthcare assets domestically and internationally, subject to the contractual restrictions contained in the instruments governing our existing indebtedness. Investments in and acquisitions of these properties entail general risks associated with any real estate investment, including risks that the investment's performance will fail to meet expectations, that the cost estimates for necessary property improvements will prove inaccurate or that the tenant, operator or manager will

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underperform. Furthermore, healthcare properties are often highly customized and may require costly tenant-specific improvements.

        Our ability to compete successfully for investment and acquisition opportunities is affected by many factors, including our cost of obtaining debt and equity capital at rates comparable to or better than our competitors. When we attempt to finance, acquire or develop properties, we compete with other healthcare REITs, healthcare providers, healthcare lenders, real estate partnerships, banks, insurance companies, private equity firms and other investors, some of whom have greater financial resources and lower costs of capital than we do. Increased competition makes it more challenging for us to identify and successfully capitalize on opportunities that meet our business objectives and could improve the bargaining power of property owners seeking to sell, thereby impeding our investment, acquisition and development activities. See "Business—Competition" included in Item 1 of this Annual Report on Form 10-K.

        In addition, new development projects that we pursue may experience construction delays or cost overruns that increase our expenses, fail to obtain required zoning, occupancy and other governmental approvals and permits on a timely basis, or remain incomplete after incurring significant development costs. Investments in and acquisitions of properties outside the United States create additional legal, economic and market risks associated with operating in foreign countries, such as currency exchange fluctuations and foreign tax risks. If we incur additional debt or issue equity securities, or both, to finance future investments, acquisitions or development activity, our leverage could increase or our per share financial results could decline.

Our investments are concentrated in seniors housing and healthcare real estate, making us more vulnerable economically than if our investments were diversified.

        We invest primarily in seniors housing and healthcare properties, and our ability to make investments outside the seniors housing or healthcare industries is restricted by the terms of our existing indebtedness. This concentration exposes us to greater economic risk than if our portfolio included real estate assets in other industries or non-real estate assets. For example, the healthcare industry is highly regulated, and changes in government regulation and reimbursement can have material adverse consequences on the healthcare industry, some of which may be unintended. We cannot provide any assurance that future changes in government regulation of healthcare will not adversely affect the healthcare industry, including our seniors housing and healthcare operations, tenants and operators, which could have a more pronounced effect on us than if our investments were further diversified.

        The healthcare industry is also highly competitive. The occupancy levels at, and revenues from, our properties depend on the ability of our tenants, operators and managers to successfully compete with other operators and managers, including with respect to the scope and quality of care and services provided, reputation and financial condition, physical appearance of the properties, price and location. We cannot be certain that our tenants, operators and managers will be able to achieve and maintain occupancy and rate levels that will enable them to meet all of their obligations to us, and our operators and managers may encounter increased competition that could limit their ability to attract residents and patients or expand their businesses, which could materially adversely affect their ability to meet their obligations to us and have a Material Adverse Effect on us.

        Real estate investments are relatively illiquid, and our ability to quickly sell or exchange our properties in response to changes in economic or other conditions is limited. In the event we desire or need to sell any of our properties, the value of those properties and our ability to sell at a price or on terms acceptable to us could be adversely affected by the current downturn in the real estate industry or any weakness in the seniors housing and healthcare industries. In addition, transfers of healthcare properties may be subject to regulatory approvals that are not required for transfers of other types of

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commercial properties. We cannot provide any assurance that we will recognize full value for any property that we sell for liquidity or other reasons, and the inability to respond quickly to changes in the performance of our investments could adversely affect our business, results of operations and financial condition.

Our tenants, operators and managers may be adversely affected by increasing healthcare regulation and enforcement.

        Over the last several years, the regulatory environment of the long-term healthcare industry has intensified both in the amount and type of regulations and in the efforts to enforce those regulations. This is particularly true for large for-profit, multi-facility providers like Kindred, Brookdale Senior Living, Atria and Sunrise. The extensive federal, state and local laws and regulations affecting the healthcare industry include those relating to, among other things, licensure, conduct of operations, ownership of facilities, addition of facilities and equipment, allowable costs, services, prices for services, qualified beneficiaries, quality of care, patient rights, fraudulent or abusive behavior, and financial and other arrangements that may be entered into by healthcare providers. Changes in enforcement policies by federal and state governments have resulted in a significant increase in the number of inspections, citations of regulatory deficiencies and other regulatory sanctions, including terminations from the Medicare and Medicaid programs, bars on Medicare and Medicaid payments for new admissions, civil monetary penalties and even criminal penalties. See "Governmental Regulation—Healthcare Regulation" included in Item 1 of this Annual Report on Form 10-K.

        If our tenants, operators and managers fail to comply with the extensive laws, regulations and other requirements applicable to their businesses and the operation of our properties, they could become ineligible to receive reimbursement from governmental and private third-party payor programs, face bans on admissions of new patients or residents, suffer civil or criminal penalties or be required to make significant changes to their operations. Our tenants, operators and managers also could be forced to expend considerable resources responding to an investigation or other enforcement action under applicable laws or regulations. In such event, the results of operations and financial condition of our tenants, operators and managers and the results of operations of our properties operated or managed by those entities could be adversely affected, which, in turn, could have a Material Adverse Effect on us. We are unable to predict future federal, state and local regulations and legislation, including the Medicare and Medicaid statutes and regulations, or the intensity of enforcement efforts with respect to such regulations and legislation, and any changes in the regulatory framework could have a material adverse effect on our tenants, operators and managers, which, in turn, could have a Material Adverse Effect on us.

Changes in the reimbursement rates or methods of payment from third-party payors, including the Medicare and Medicaid programs, could have a material adverse effect on certain of our tenants and operators.

        Certain of our tenants and operators rely on reimbursement from third-party payors, including the Medicare and Medicaid programs, for substantially all of their revenues. Federal and state legislators and regulators have adopted or proposed various cost-containment measures that would limit payments to healthcare providers, and budget crises and financial shortfalls have caused states to implement or consider Medicaid rate freezes or cuts. See "Governmental Regulation—Healthcare Regulation" included in Item 1 of this Annual Report on Form 10-K. Similarly, private third-party payors have continued their efforts to control healthcare costs. We cannot provide any assurance that adequate reimbursement levels will be available for services to be provided by our tenants and operators that currently depend on Medicare, Medicaid or private payor reimbursement. Significant limits by governmental and private third-party payors on the scope of services reimbursed or on reimbursement rates and fees could have a material adverse effect on the liquidity, financial condition and results of operations of certain of our tenants and operators, which could affect adversely their ability to make rental payments under, and otherwise comply with the terms of, their leases with us.

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Revenues from our senior living operations are dependent on private pay sources; Events which adversely affect the ability of seniors and their families to afford daily resident fees at our seniors housing communities could cause our occupancy rates, resident fee revenues and results of operations to decline.

        By and large, assisted and independent living services currently are not reimbursable under government reimbursement programs, such as Medicare and Medicaid. Hence, substantially all of the resident fee revenues generated by our senior living operations are derived from private pay sources consisting of income or assets of residents or their family members. In general, due to the expense associated with building new properties and the staffing and other costs of providing services at these properties, only seniors with income or assets meeting or exceeding the comparable median in the regions where our properties are located typically can afford to pay the daily resident and care fees. The continued weak economy and depressed housing market, as well as other events such as changes in demographics, could adversely affect the ability of seniors and their families to afford these fees. If the managers of our seniors housing communities are unable to attract and retain seniors with sufficient income, assets or other resources required to pay the fees associated with assisted and independent living services, our occupancy rates, resident fee revenues and results of operations could decline, which, in turn, could have a Material Adverse Effect on us.

Our investments in joint ventures could be adversely affected by our lack of sole decision-making authority regarding major decisions, our reliance on our joint venture partners' financial condition, any disputes that may arise between us and our joint venture partners, and our exposure to potential losses from the actions of our joint venture partners.

        As of December 31, 2011, we had controlling interests in eleven MOBs and eighteen seniors housing communities owned through joint ventures with third parties, and we had noncontrolling interests of between 5% and 25% in 58 MOBs, 20 seniors housing communities and fourteen skilled nursing facilities owned through joint ventures with third parties. These joint ventures involve risks not present with respect to our wholly owned properties, including the following:

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We may be adversely affected by fluctuations in currency exchange rates.

        Our ownership of twelve seniors housing communities in the Canadian provinces of Ontario and British Columbia subjects us to fluctuations in U.S. and Canadian exchange rates, which may, from time to time, impact our financial condition and results of operations. If we increase our international presence through investments in, or acquisitions or development of, seniors housing or healthcare assets outside the United States, we may transact business in currencies other than U.S. or Canadian dollars. Although we may pursue hedging alternatives, including borrowing in local currencies, to protect against foreign currency fluctuations, we cannot provide any assurance that such fluctuations will not have a Material Adverse Effect on us.

Our ownership of certain properties subject to ground lease, air rights or other restrictive agreements exposes us to the loss of such properties upon breach or termination of such agreements, limits our uses of these properties and restricts our ability to sell or otherwise transfer such properties.

        We have investments in many of our MOBs and certain other properties through leasehold interests in the land on which the buildings are located, through leases of air rights for the space above the land on which the buildings are located or through similar agreements, and we may acquire or develop additional properties in the future that are subject to similar ground lease, air rights or other restrictive agreements. Under these agreements, we could lose our interests in the property upon termination or an earlier breach by us. In addition, many of our ground lease, air rights and other restrictive agreements impose significant limitations on our uses of the subject properties, restrict our right to convey our interests in such properties, which may limit our ability to timely sell or exchange the properties and impair their value, or restrict the leasing of such properties, which may negatively impact our ability to find suitable tenants for the properties.

Overbuilding in markets in which our seniors housing communities and MOBs are located could adversely affect our future occupancy rates, operating margins and profitability.

        The seniors housing and MOB industries generally have limited barriers to entry, and, as a consequence, the development of new seniors housing communities or MOBs could outpace demand. If development outpaces demand for those asset types in the markets in which our properties are located, those markets may become saturated and we could experience decreased occupancy, reduced operating margins and lower profitability.

Termination of resident lease agreements could adversely affect our revenues and earnings.

        Applicable regulations governing assisted living communities generally require a written lease agreement with each resident that gives the resident the right to terminate his or her lease agreement for any reason on reasonable notice. Consistent with these regulations, the resident lease agreements entered into by the managers of our seniors housing communities generally allow residents to terminate their lease agreements on 30 days' notice. Thus, unlike typical apartment lease agreements that have terms of one year or longer, our managers cannot contract with residents to stay for longer periods of time. In addition, the resident turnover rate in our seniors housing communities may be difficult to predict. If a large number of resident lease agreements terminate at or around the same time, and if the affected units remain unoccupied, our revenues and earnings could be adversely affected, which, in turn, could have a Material Adverse Effect on us.

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The hospitals on whose campuses our MOBs are located and their affiliated health systems could fail to remain competitive or financially viable, which could adversely impact their ability to attract physicians and physician groups to our MOBs.

        Our MOB operations depend on the viability of the hospitals on or near whose campuses our MOBs are located and their affiliated health systems in order to attract physicians and other healthcare-related clients. The viability of these hospitals, in turn, depends on factors such as the quality and mix of healthcare services provided, competition, demographic trends in the surrounding community, market position and growth potential, as well as the ability of the affiliated health systems to provide economies of scale and access to capital. If a hospital on or near whose campus one of our MOBs is located is unable to meet its financial obligations, and if an affiliated health system is unable to support that hospital, the hospital may not be able to compete successfully or could be forced to close or relocate, which could adversely impact its ability to attract physicians and other healthcare-related clients. Because we rely on our proximity to and affiliations with these hospitals to create demand for space in our MOBs, their inability to remain competitive or financially viable, or to attract physicians and physician groups, could materially adversely affect our MOB operations and have a Material Adverse Effect on us.

Volatility or disruption in the capital markets could prevent our counterparties from satisfying their obligations to us.

        Uncertainty in the capital markets and tightening of credit markets, similar to that experienced in recent years, could make accessing new capital more challenging and more expensive for our counterparties. Interest rate fluctuations, financial market volatility or credit market disruptions could limit the ability of our tenants, operators and managers to obtain credit to finance their businesses on acceptable terms, which could adversely affect their ability to satisfy their obligations to us. In addition, any difficulty in accessing capital or other sources of funds experienced by our other counterparties, such as letters of credit issuers, insurance carriers, banking institutions, title companies and escrow agents, could prevent such counterparties from remaining viable entities or satisfying their obligations to us, which could have a Material Adverse Effect on us.

The amount and scope of insurance coverage provided by our policies and policies maintained by our tenants, operators and managers may not adequately insure against losses.

        We maintain or require in our existing lease, management and other agreements that our tenants, operators and managers maintain adequate insurance coverage on our properties and their operations. Although we continually review the scope and level of insurance maintained by us and our tenants, operators and managers and believe the coverage provided to be customary for similarly situated companies in our industry, we cannot provide any assurance that we or our tenants, operators and managers will continue to be able to maintain adequate levels of insurance. We also cannot provide any assurance that we will continue to require the same levels of insurance coverage under our lease, management and other agreements, that such insurance will be available at a reasonable cost in the future or that the insurance coverage provided will fully cover all losses on our properties upon the occurrence of a catastrophic event, nor can we make any guaranty as to the future financial viability of the insurers.

        Should an uninsured loss or a loss in excess of insured limits occur, we could incur substantial liability or lose all or a portion of the capital we have invested in a property, as well as the anticipated future revenues from the property. In such an event, we might nevertheless remain obligated for any mortgage debt or other financial obligations related to the property. We cannot provide any assurance that material uninsured losses, or losses in excess of insurance proceeds, will not occur in the future.

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        As part of our MOB development business, we provide engineering, construction and architectural services, and any design, construction or systems failures related to the properties we develop may result in substantial injury or damage to clients or third parties. Injury or damage claims may arise in the ordinary course and may be asserted with respect to ongoing or completed projects. Although we maintain liability insurance, if any claim results in a loss, we cannot provide any assurance that our insurance coverage would be adequate to cover the loss in full. If we sustain losses in excess of our insurance coverage, we may be required to make a payment for the difference and could lose our investment in, or experience reduced profits and cash flows from, the affected MOB, which could have a Material Adverse Effect on us.

Significant legal actions could subject us or our tenants, operators and managers to increased operating costs and substantial uninsured liabilities, which could materially adversely affect our or their liquidity, financial condition and results of operations.

        From time to time, we may be subject to claims brought against us in lawsuits and other legal proceedings arising out of our alleged actions or the alleged actions of our tenants, operators and managers for which such tenants, operators and managers may have agreed to indemnify, defend and hold us harmless. An unfavorable resolution of any such pending or future litigation could materially adversely affect our or their liquidity, financial condition and results of operations and have a Material Adverse Effect on us.

        In some of these cases, we and our tenants, operators and managers may be subject to professional liability claims brought by plaintiffs' attorneys seeking significant punitive damages and attorneys' fees. Due to the historically high frequency and severity of professional liability claims against healthcare and seniors housing providers, the availability of professional liability insurance has been restricted and the premiums on such insurance coverage remain very high. As a result, our insurance coverage and the insurance coverage of our tenants, operators and managers might not cover all claims against us or them and might not be available to us or them at a reasonable cost. If we or our tenants, operators and managers are unable to maintain adequate insurance coverage or are required to pay punitive damages, we or they may be exposed to substantial liabilities.

        In an effort to reduce and manage their costs and for various other reasons, many companies in the healthcare industry, including some of our tenants, operators and managers, are pursuing different organizational and corporate structures coupled with self-insurance trusts or programs (commonly referred to as "captives") that may provide them with less insurance coverage. Those companies that insure any part of their general and professional liability risks through their own captive limited purpose entities generally estimate the future cost of general and professional liability through actuarial studies that rely primarily on historical data. However, due to the rise in the number and severity of professional claims against healthcare providers, these actuarial studies may underestimate the future cost of claims, and reserves for future claims may not be adequate to cover the actual cost of those claims. As a result, the tenants, operators and managers of our properties who self-insure could incur large funded and unfunded professional liability expense, which could materially adversely affect their liquidity, financial condition and results of operations and, in turn, their ability to satisfy their obligations to us or, in the case of our senior living operations, our results of operations and, in either case, have a Material Adverse Effect on us. Likewise, if we decide to implement a captive, any large funded and unfunded professional liability expenses that we incur could have a Material Adverse Effect on us.

We may not be able to maintain or expand our relationships with our existing and future hospital and health system clients.

        The success of our MOB business depends, to a large extent, on our past, current and future relationships with hospital and health system clients. We invest a significant amount of time to develop

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these relationships, and our relationships have helped us to secure acquisition and development opportunities, as well as other advisory, property management and hospital project management projects, with both new and existing clients. If our relationships with hospital or health system clients deteriorate, or if a conflict of interest or non-compete arrangement prevents us from expanding these relationships, our ability to secure new acquisition and development opportunities or other advisory, property management and hospital project management projects could be adversely impacted and our professional reputation within the industry could be damaged.

Our MOB development projects, including development projects undertaken on a fee-for-service basis or through our joint ventures, may not yield anticipated returns.

        A key component of our MOB long-term growth strategy is exploring development opportunities and, when appropriate, making investments in those projects. In deciding whether to make an investment in a particular MOB development, we make certain assumptions regarding the expected future performance of that property. These assumptions are subject to risks normally associated with these projects, including, among others, that:

        Moreover, in MOB development projects undertaken on a fee-for-service basis, we generally construct properties for clients in exchange for a fixed fee, which creates risks such as the inability to pass on increased labor and construction material costs to our clients, development and construction delays that could give our counterparties the right to receive penalties from us, and bankruptcy or default by our contractors. We attempt to mitigate these risks by establishing certain limits on our obligations, shifting some of the risk to the general contractor or seeking other legal protections, but we cannot provide any assurance that our mitigation efforts will be effective.

        If any of the risks described above occur, our MOB development projects, including development projects undertaken on a fee-for-service basis or through our joint ventures, may not yield anticipated returns, which could materially adversely affect our MOB operations and have a Material Adverse Effect on us.

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Economic and other conditions that negatively affect geographic areas to which a greater percentage of our NOI is attributed could adversely affect our financial results.

        For the year ended December 31, 2011, approximately 42.1% of our NOI was derived from properties located in California (12.5%), Illinois (7.1%), Texas (6.1%), Massachusetts (5.8%), New York (5.7%), and Florida (4.9%). As a result, we are subject to increased exposure to adverse conditions affecting these regions, including downturns in the local economies or changes in local real estate conditions, increased competition or decreased demand, and changes in state-specific legislation, which could adversely affect our business and results of operations.

Our operators may be sued under a federal whistleblower statute.

        Our operators who engage in business with the federal government may be sued under a federal whistleblower statute designed to combat fraud and abuse in the healthcare industry. See "Governmental Regulation—Healthcare Regulation" included in Item 1 of this Annual Report on Form 10-K. These lawsuits can involve significant monetary damages and award bounties to private plaintiffs who successfully bring these suits. If any of these lawsuits were to be brought against our operators, such suits combined with increased operating costs and substantial uninsured liabilities could have a material adverse effect on the operators' liquidity, financial condition and results of operation and on their ability to make rental payments to us, which, in turn, could have a Material Adverse Effect on us.

If any of our properties are found to be contaminated, or if we become involved in any environmental disputes, we could incur substantial liabilities and costs.

        Under federal and state environmental laws and regulations, a current or former owner of real property may be liable for costs related to the investigation, removal and remediation of hazardous or toxic substances or petroleum that are released from or are present at or under, or that are disposed of in connection with such property. Owners of real property may also face other environmental liabilities, including government fines and penalties imposed by regulatory authorities and damages for injuries to persons, property or natural resources. Environmental laws and regulations often impose liability without regard to whether the owner was aware of, or was responsible for, the presence, release or disposal of hazardous or toxic substances or petroleum. In certain circumstances, environmental liability may result from the activities of a current or former operator of the property. Although we are generally indemnified by the current operators of our properties for contamination caused by them, these indemnities may not adequately cover all environmental costs. See "Governmental Regulation—Environmental Regulation" included in Item 1 of this Annual Report on Form 10-K.

Our success depends, in part, on our ability to retain key personnel, and the loss of any one of them could adversely impact our business.

        The success of our business depends, in part, on the leadership and performance of our executive management team and key employees, and our ability to retain and motivate these individuals could significantly impact our future performance. Competition for these individuals is intense, and we cannot provide any assurance that we will retain our key officers and employees or that we will be able to attract and retain other highly qualified individuals in the future. Losing any one or more of these persons could have a Material Adverse Effect on us.

Failure to maintain effective internal control over financial reporting could harm our business, results of operations and financial condition.

        Pursuant to the Sarbanes-Oxley Act of 2002, we are required to provide a report by management on internal control over financial reporting, including management's assessment of the effectiveness of

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such control. Changes to our business will necessitate ongoing changes to our internal control systems and processes. Internal control over financial reporting may not prevent or detect misstatements because of its inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud. Therefore, even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements. If we fail to maintain the adequacy of our internal controls, including any failure to implement required new or improved controls, or if we experience difficulties in their implementation, our business, results of operations and financial condition could be materially adversely harmed and we could fail to meet our reporting obligations.

If the liabilities we have assumed in connection with acquisitions are greater than expected, or if there are unknown liabilities, our business could be materially and adversely affected.

        We may have certain liabilities in connection with our acquisitions, including, in some cases, contingent liabilities. As we integrate these acquisitions, we may learn additional information about the sellers, the properties, their operations and/or their liabilities that adversely affects us, such as:

As a result, we cannot provide any assurance that our past acquisitions will be successful or will not, in fact, harm our business. Among other things, if the liabilities we have assumed are greater than expected, or if there are obligations relating to the acquired properties or businesses of which we were not aware at the time we completed the acquisition, our business and results of operations could be materially adversely affected.

Risks Arising from Our Capital Structure

We may become more leveraged.

        As of December 31, 2011, we had approximately $6.4 billion of outstanding indebtedness (including capital lease obligations). The instruments governing our existing indebtedness permit us to incur substantial additional debt, including secured debt, and we may elect to meet our capital and liquidity needs through additional borrowings. A high level of indebtedness would require us to dedicate a substantial portion of our cash flow from operations to the payment of debt service, thereby reducing the funds available to implement our business strategy and make distributions to stockholders. A high level of indebtedness could also have the following consequences:

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        In addition, from time to time, we mortgage our properties to secure payment of indebtedness. If we are unable to meet our mortgage payments, then the encumbered properties could be foreclosed upon or transferred to the mortgagee with a consequent loss of income and asset value.

We are exposed to increases in interest rates, which could reduce our profitability and adversely impact our ability to refinance existing debt, sell assets or engage in acquisition and investment activity, and our decision to hedge against interest rate risk might not be effective.

        We receive a significant portion of our revenues by leasing our assets under long-term triple-net leases in which the rental rate is generally fixed with annual rent escalations, subject to certain limitations. Certain of our debt obligations are floating rate obligations with interest rate and related payments that vary with the movement of LIBOR, Bankers' Acceptance or other indexes. The generally fixed rate nature of our revenues and the variable rate nature of certain of our obligations create interest rate risk. Although our operating assets provide a partial hedge against interest rate fluctuations, if interest rates rise, our interest costs for our existing floating rate debt and any new debt we incur would also increase. This increased cost could reduce our profitability, make our lease and other revenues insufficient to meet our obligations, or increase the cost of financing our acquisition and investment activity. Further, rising interest rates could limit our ability to refinance existing debt upon maturity or cause us to pay higher rates upon refinancing. An increase in interest rates may also decrease the amount third parties are willing to pay for our assets, thereby limiting our ability to reposition our portfolio promptly in response to changes in economic or other conditions.

        We may seek to manage our exposure to interest rate volatility with hedging arrangements that involve risk, including the risk that counterparties may fail to honor their obligations under these arrangements, that these arrangements may not be effective in reducing our exposure to interest rate changes, that the amount of income we may earn from hedging transactions may be limited by federal tax provisions governing REITs, and that these arrangements may result in higher interest rates than would otherwise be the case. Moreover, no amount of hedging activity can completely insulate us from the risks associated with changes in interest rates. Failure to hedge effectively against interest rate risk, if we choose to engage in such activities, could adversely affect our results of operations and financial condition.

Limitations on our ability to access capital could have an adverse effect on our ability to meet our debt payments, make distributions to our stockholders or make future investments necessary to implement our business strategy.

        We cannot provide any assurance that we will be able to raise the necessary capital to meet our debt service obligations, make distributions to our stockholders or make future investments necessary to implement our business strategy, and the failure to do so could have a Material Adverse Effect on us. In recent years, the global capital and credit markets experienced a period of extraordinary turmoil and upheaval, characterized by the bankruptcy, failure or sale of various financial institutions and an unprecedented level of intervention from the U.S. federal government. The disruption in the credit markets, the repricing of credit risk and the deterioration of the financial and real estate markets created difficult conditions for REITs and other companies to access capital or other sources of funds. Although access to capital and other sources of funding have improved, we cannot provide any assurance that conditions will not deteriorate or that our access to capital and other sources of funding will not become constrained, which could adversely affect our results of operation and financial condition. In addition, the federal government's failure to increase the amount of debt that it is statutorily permitted to incur as needed to meet its future financial commitments or a downgrade in the debt rating on U.S. government securities could lead to a weakened U.S. dollar, rising interest rates and constrained access to capital, which could materially adversely affect the U.S. and global economies, increase our costs of borrowing and have a Material Adverse Effect on us.

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        To address constraints on our access to capital, we could, among other things, (i) obtain commitments from the banks in our lending group or from new banks to fund increased amounts under the terms of our unsecured revolving credit facility or our unsecured term loan facilities, (ii) access the public capital markets, (iii) obtain secured loans from government-sponsored entities, pension funds or similar sources, (iv) decrease or eliminate our distributions to our stockholders or pay taxable stock dividends, or (v) delay or cease our acquisition and investment activity. As with other public companies, our access to debt and equity capital depends, in part, on the trading prices of our senior notes and common stock, which, in turn, depend upon market conditions that change from time to time, such as the market's perception of our financial condition, our growth potential and our current and future earnings and cash distributions. Our failure to meet the market's expectation with regard to future earnings and cash distributions or a significant downgrade in the ratings assigned to our long-term debt could impact our ability to access capital or increase our borrowing costs. If we cannot access capital at an acceptable cost or at all, we may be required to liquidate one or more investments in properties at times that may not permit us to realize the maximum return on those investments, which could also result in adverse tax consequences to us. Restrictions on our uses of, and our right to transfer, properties under certain healthcare regulations, ground leases, mortgages and other agreements to which our properties may be subject could adversely impact our ability to timely liquidate those investments and impair their value.

        If the financial institutions that are parties to our unsecured revolving credit facility become capital constrained, tighten their lending standards or become insolvent or if they experience excessive volumes of borrowing requests from other borrowers within a short period of time, they may be unable or unwilling to honor their funding commitments to us, which would adversely affect our ability to draw on our unsecured revolving credit facility and, over time, could negatively impact our ability to consummate acquisitions, repay indebtedness as it matures, fund capital expenditures or make distributions to our stockholders. Adverse conditions in the credit markets could also adversely affect the availability and terms of future borrowings, renewals or refinancings.

Covenants in the instruments governing our existing indebtedness limit our operational flexibility, and a covenant breach could materially adversely affect our operations.

        The terms of the instruments governing our existing indebtedness require us to comply with a number of customary financial and other covenants, such as maintaining debt service coverage, leverage ratios and minimum net worth requirements. Our continued ability to incur additional debt and to conduct business in general is subject to our compliance with these covenants, which limit our operational flexibility. Breaches of these covenants could result in defaults under the applicable debt instruments and could trigger defaults under any other indebtedness that is cross-defaulted against such instruments, even if we satisfy our payment obligations. Financial and other covenants that limit our operational flexibility, as well as defaults resulting from our breach of any of these covenants, could have a Material Adverse Effect on us.

Risks Arising from Our Status as a REIT

Loss of our status as a REIT would have significant adverse consequences for us and the value of our common stock.

        If we lose our status as a REIT (currently and/or with respect to any tax years for which the statute of limitations has not expired), we will face serious tax consequences that will substantially reduce the funds available to satisfy our obligations, to implement our business strategy and to make distributions to our stockholders for each of the years involved because:

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        In addition, in such event we would no longer be required to pay dividends to maintain REIT status, which could adversely affect the value of our common stock.

        Qualification as a REIT involves the application of highly technical and complex Code provisions for which there are only limited judicial and administrative interpretations. The determination of factual matters and circumstances not entirely within our control, as well as new legislation, regulations, administrative interpretations or court decisions, may adversely affect our investors or our ability to remain qualified as a REIT for tax purposes. Although we believe that we qualify as a REIT, we cannot provide any assurance that we will continue to qualify as a REIT for tax purposes.

The 90% distribution requirement will decrease our liquidity and may limit our ability to engage in otherwise beneficial transactions.

        To comply with the 90% distribution requirement applicable to REITs and to avoid the nondeductible excise tax, we must make distributions to our stockholders. See "Certain U.S. Federal Income Tax Considerations—Requirements for Qualification as a REIT—Annual Distribution Requirements" included in Item 1 of this Annual Report on Form 10-K. However, such distributions may limit our ability to rely upon rental payments from our properties or subsequently acquired properties to finance investments, acquisitions or new developments.

        Although we do not anticipate any inability to satisfy the REIT distribution requirement, from time to time, we may not have sufficient cash or other liquid assets to do so. For example, timing differences between the actual receipt of income and actual payment of deductible expenses, on the one hand, and the inclusion of that income and deduction of those expenses in arriving at our taxable income, on the other hand, or non-deductible expenses such as principal amortization or repayments or capital expenditures in excess of non-cash deductions may cause us to fail to have sufficient cash or liquid assets to enable us to satisfy the 90% distribution requirement.

        In the event that timing differences occur or we decide to retain cash or to distribute such greater amount as may be necessary to avoid income and excise taxation, we may, if possible, borrow funds, issue additional equity securities, pay taxable stock dividends, distribute other property or securities or engage in a transaction intended to enable us to meet the REIT distribution requirements. Any of these actions may require us to raise additional capital to meet our obligations; however, see "—Risks Arising from Our Capital Structure—Limitations on our ability to access capital could have an adverse effect on our ability to meet our debt payments, make distributions to our stockholders or make future investments necessary to implement our business strategy." The terms of the instruments governing our existing indebtedness restrict our ability to engage in some of these transactions.

To preserve our qualification as a REIT, our certificate of incorporation contains ownership limits with respect to our capital stock that may delay, defer or prevent a change of control of our company.

        To assist us in preserving our qualification as a REIT, our certificate of incorporation provides that if a person acquires beneficial ownership of more than 9.9% of our outstanding preferred stock or more than 9.0% of our common stock, the shares that are beneficially owned in excess of the applicable limit are considered to be "excess shares" and are automatically deemed transferred to a trust for the benefit of a charitable institution or other qualifying organization selected by our Board of Directors. The trust is entitled to all dividends with respect to the excess shares and the trustee may exercise all voting power over the excess shares. In addition, we have the right to purchase the excess

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shares for a price equal to the lesser of (i) the price per share in the transaction that created the excess shares or (ii) the market price on the day we purchase the shares, but if we do not purchase the excess shares, the trustee of the trust is required to transfer the shares at the direction of our Board of Directors. These ownership limits could delay, defer or prevent a transaction or a change of control that might involve a premium price for our common stock or might otherwise be in the best interests of our stockholders.

If we decide to pay taxable stock dividends to meet the REIT distribution requirements, your tax liability may be greater than the amount of cash you receive.

        Under Revenue Procedure 2010-12, the IRS has stated that it will treat stock dividends as distributions for purposes of satisfying the REIT distribution requirements for calendar years 2008 through 2012 if each stockholder can elect to receive the distribution in cash, even if the aggregate cash amount paid to all stockholders is limited, provided certain requirements are met. Accordingly, if we decide to pay a stock dividend in accordance with Revenue Procedure 2010-12, your tax liability with respect to such dividend may be significantly greater than the amount of cash you receive.

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ITEM 1B.    Unresolved Staff Comments

        None.

ITEM 2.    Properties

Seniors Housing and Healthcare Properties

        As of December 31, 2011, we owned 1,378 properties located in 46 states, the District of Columbia and two Canadian provinces, consisting of: 678 seniors housing communities; 396 skilled nursing facilities; 47 hospitals; 249 MOBs; and eight personal care facilities. We also were in the process of developing three properties as of December 31, 2011. We believe that the asset class, tenant, operator and manager, geographic location, revenue source and business model diversity of our portfolio makes us less susceptible to regional economic downturns and adverse changes in regulation or reimbursement rates or methodologies in any single state or with respect to any particular asset type.

        At December 31, 2011, our share of mortgage loan obligations outstanding was $2.7 billion and the consolidated aggregate principal amount was $2.8 billion, secured by 228 of our properties.

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        The following table sets forth select information regarding our portfolio of properties as of December 31, 2011 for each geographic location in which we own property:

 
  Seniors Housing
Communities
  Skilled Nursing
Facilities
  Hospitals   MOBs   Other
Properties
 
Geographic Location
  Number of
Properties
  Units   Number of
Facilities
  Licensed
Beds
  Number of
Hospitals
  Licensed
Beds
  Number of
Properties
  Number of
Properties
 

Alabama

    10     775     2     329             4      

Arizona

    18     1,614     3     462     4     221     14      

Arkansas

    6     369     8     877                  

California

    63     7,534     9     1,114     7     530     16      

Colorado

    14     1,322     4     460     1     68     9      

Connecticut

    13     1,515     8     873                  

District of Columbia

                            2      

Florida

    47     4,519     2     293     6     511     18      

Georgia

    15     1,200     5     621             10      

Idaho

    1     70     7     624                  

Illinois

    16     2,561     1     82     4     430     28      

Indiana

    20     1,751     34     3,782     1     59     15      

Kansas

    10     588     5     327                  

Kentucky

    7     625     29     3,254     2     424          

Louisiana

    1     58             1     168     8      

Maine

    4     624     8     654                  

Maryland

    5     361     3     445             2      

Massachusetts

    19     2,019     48     5,504     2     109          

Michigan

    22     1,459                     11      

Minnesota

    19     959     4     666             1      

Mississippi

    1     53                          

Missouri

    5     249     12     1,090     2     227     21      

Montana

    2     146     2     276                  

Nebraska

    1     135                          

Nevada

    6     618     3     299     1     52     2      

New Hampshire

            3     502                  

New Jersey

    13     1,165     1     153                  

New Mexico

    5     512             1     61          

New York

    40     4,458     9     1,566                  

North Carolina

    18     1,645     17     1,876     1     124          

North Dakota

    1     49                          

Ohio

    27     1,892     21     2,943             29      

Oklahoma

    5     224     5     235     1     59          

Oregon

    19     1,504     13     1,290             1      

Pennsylvania

    36     2,670     9     1,037     2     115     4      

Rhode Island

    6     648     2     187                  

South Carolina

    7     384     4     604             3      

South Dakota

    4     184     2     246                  

Tennessee

    20     1,760     5     602     1     49     9      

Texas

    42     2,938     47     5,526     10     615     18     8  

Utah

    2     259     5     476                  

Vermont

            1     144                  

Virginia

    7     585     10     1,380             3      

Washington

    18     1,853     19     1,879             8      

West Virginia

    2     125     4     326                  

Wisconsin

    68     2,931     18     2,498             12      

Wyoming

    1     48     4     371             1      
                                   

Total U.S

    666     56,958     396     45,873     47     3,822     249     8  

British Columbia

   
3
   
276
   
   
   
   
   
   
 

Ontario

    9     848                          
                                   

Total Canada

    12     1,124                          
                                   

Total

    678     58,082     396     45,873     47     3,822     249     8  
                                   

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Corporate Offices

        Our headquarters are located in Chicago, Illinois, and we have additional offices in Louisville, Kentucky, Dallas, Texas and Newport Beach, California. We lease all of our corporate offices.

ITEM 3.    Legal Proceedings

        The information contained in "Note 16—Litigation" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K is incorporated by reference into this Item 3. Except as set forth therein, we are not a party to, nor is any of our property the subject of, any material pending legal proceedings.

ITEM 4.    (Removed and Reserved)

PART II

ITEM 5.    Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

        Our common stock, par value $0.25 per share, is listed and traded on the New York Stock Exchange (the "NYSE") under the symbol "VTR." The following table sets forth, for the periods indicated, the high and low sales prices of our common stock as reported on the NYSE and the dividends declared per share.

 
  Sales Price of
Common Stock
   
 
 
  Dividends
Declared
 
 
  High   Low  

2011

                   

First Quarter

  $ 57.45   $ 50.98   $ 0.575  

Second Quarter

    57.08     50.87     0.575  

Third Quarter

    55.75     43.25     0.575  

Fourth Quarter

    56.73     46.21     0.575  

2010

                   

First Quarter

  $ 49.24   $ 40.36   $ 0.535  

Second Quarter

    50.33     43.14     0.535  

Third Quarter

    53.89     45.77     0.535  

Fourth Quarter

    56.20     48.53     0.535  

        As of February 14, 2012, we had 288,915,189 shares of our common stock outstanding held by approximately 3,540 stockholders of record.

Dividends and Distributions

        We pay regular quarterly dividends to holders of our common stock to comply with the provisions of the Code governing REITs. On February 15, 2012, our Board of Directors declared the first quarterly installment of our 2012 dividend in the amount of $0.62 per share, payable in cash on March 29, 2012 to stockholders of record on March 9, 2012. We expect to distribute at least 100% of our taxable net income, after the use of any net operating loss carryforwards, to our stockholders for 2012. See "Certain U.S. Federal Income Tax Considerations—Requirements for Qualification as a REIT—Annual Distribution Requirements" included in Part I, Item 1 of this Annual Report on Form 10-K.

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        In general, our Board of Directors makes decisions regarding the nature, frequency and amount of our dividends on a quarterly basis. Because the Board considers a number of factors when making these decisions, including our current and future liquidity needs and financial condition, our current and projected results of operations and the performance and credit quality of our tenants, operators, managers and borrowers, we cannot provide any assurance that we will maintain the policy of paying regular quarterly dividends to continue to qualify as a REIT. Please see "Cautionary Statements" and the risk factors included in Part I, Item 1A of this Annual Report on Form 10-K for a description of other factors that may affect our distribution policy.

        Our stockholders may reinvest all or a portion of any cash distribution on their shares of our common stock by participating in our Distribution Reinvestment and Stock Purchase Plan, subject to the terms of the plan. See "Note 17—Capital Stock" of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Director and Employee Stock Sales

        Certain of our directors, executive officers and other employees have adopted and may, from time to time in the future, adopt non-discretionary, written trading plans that comply with Rule 10b5-1 under the Exchange Act, or otherwise monetize their equity-based compensation.

        Each of our executive officers has advised us that he or she has not pledged any of our equity securities to secure "margin loans." Our Securities Trading Policy prohibits our directors, executive officers and employees from buying or selling financial instruments that are designed to hedge or offset a decrease in the market value of our securities.

Stock Repurchases

        The table below summarizes repurchases of our common stock made during the quarter ended December 31, 2011:

 
  Number of Shares
Repurchased(1)
  Average Price
Per Share
 

October 1 through October 31

    10   $ 48.20  

November 1 through November 30

    14,033   $ 52.90  

December 1 through December 31

    19,224   $ 55.00  

(1)
Repurchases represent shares withheld to pay (i) taxes on the vesting of restricted stock or restricted stock units or on the exercise of options granted to employees under our 2006 Incentive Plan or under the NHP 2005 Performance Incentive Plan and assumed by us in connection with our acquisition of NHP or (ii) the exercise price of options granted to employees under the NHP 2005 Performance Incentive Plan and assumed by us in connection with our acquisition of NHP. The value of the shares withheld is the closing price of our common stock on the date the vesting or exercise occurs or the fair market value of our common stock at the time of exercise, as the case may be.

Stock Performance Graph

        The following performance graph compares the cumulative total return (including dividends) to the holders of our common stock from December 31, 2006 through December 31, 2011, with the cumulative total returns of the NYSE Composite Index, the FTSE NAREIT Composite REIT Index (the "Composite REIT Index"), the FTSE NAREIT Healthcare Equity REIT Index (the "Healthcare REIT Index") and the S&P 500® Index over the same period. The comparison assumes $100 was invested on December 31, 2006 in our common stock and in each of the foregoing indexes and assumes reinvestment of dividends, as applicable. We have included the NYSE Composite Index in the

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performance graph because our common stock is listed on the NYSE. We have included the other indexes (other than the S&P 500® Index, of which we are a member) because we believe that they are either most representative of the industry in which we compete, or otherwise provide a fair basis for comparison with us, and are therefore particularly relevant to an assessment of our performance. The figures in the table below are rounded to the nearest dollar.

 
  12/31/2006   12/31/2007   12/31/2008   12/31/2009   12/31/2010   12/31/2011  

Ventas

  $ 100   $ 112   $ 88   $ 122   $ 152   $ 167  

NYSE Composite Index

  $ 100   $ 109   $ 66   $ 85   $ 96   $ 92  

Composite REIT Index

  $ 100   $ 82   $ 51   $ 65   $ 83   $ 89  

Healthcare REIT Index

  $ 100   $ 102   $ 90   $ 112   $ 134   $ 152  

S&P 500 Index

  $ 100   $ 105   $ 66   $ 84   $ 97   $ 99  

GRAPHIC

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ITEM 6.    Selected Financial Data

        You should read the following selected financial data in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Item 7 of this Annual Report on Form 10-K and our Consolidated Financial Statements and the notes thereto included in Item 8 of this Annual Report on Form 10-K, as acquisitions, divestitures, changes in accounting policies and other items impact the comparability of the financial data.

 
  As of and For the Years Ended December 31,  
 
  2011   2010   2009   2008   2007  
 
  (Dollars in thousands, except per share data)
 

Operating Data

                               

Rental income

  $ 819,580   $ 531,456   $ 488,458   $ 468,715   $ 446,469  

Resident fees and services

    873,308     446,301     421,058     429,257     282,226  

Interest expense

    236,807     175,631     173,810     199,135     191,022  

Property-level operating expenses

    651,561     315,953     302,813     306,944     198,125  

General, administrative and professional fees

    74,537     49,830     38,830     40,651     36,425  

Income from continuing operations attributable to common stockholders

    362,810     215,324     190,423     171,660     128,149  

Discontinued operations

    1,683     30,843     76,072     50,943     145,532  

Net income attributable to common stockholders

    364,493     246,167     266,495     222,603     273,681  

Per Share Data

                               

Income from continuing operations attributable to common stockholders, basic

  $ 1.59   $ 1.37   $ 1.25   $ 1.23   $ 1.05  

Net income attributable to common stockholders, basic

  $ 1.60   $ 1.57   $ 1.75   $ 1.59   $ 2.23  

Income from continuing operations attributable to common stockholders, diluted

  $ 1.57   $ 1.36   $ 1.24   $ 1.23   $ 1.04  

Net income attributable to common stockholders, diluted

  $ 1.58   $ 1.56   $ 1.74   $ 1.59   $ 2.22  

Dividends declared per common share

  $ 2.30   $ 2.14   $ 2.05   $ 2.05   $ 1.90  

Other Data

                               

Net cash provided by operating activities

  $ 773,197   $ 447,622   $ 422,101   $ 379,907   $ 404,600  

Net cash used in investing activities

    (997,439 )   (301,920 )   (1,746 )   (136,256 )   (1,175,192 )

Net cash provided by (used in) financing activities

    248,282     (231,452 )   (490,180 )   (95,979 )   802,675  

FFO(1)

    824,851     421,506     393,409     412,357     374,218  

Normalized FFO(1)

    776,963     453,981     409,045     379,469     327,136  

Balance Sheet Data

                               

Real estate investments, at cost

  $ 17,830,262   $ 6,747,699   $ 6,399,421   $ 6,256,562   $ 6,380,703  

Cash and cash equivalents

    45,807     21,812     107,397     176,812     28,334  

Total assets

    17,271,910     5,758,021     5,616,245     5,771,418     5,718,475  

Senior notes payable and other debt

    6,429,116     2,900,044     2,670,101     3,136,998     3,346,531  

(1)
We believe that net income, as defined by generally accepted accounting principles ("GAAP"), is the most appropriate earnings measurement. However, we consider Funds From Operations ("FFO") and normalized FFO appropriate measures of operating performance of an equity REIT. Moreover, we believe that normalized FFO provides useful information because it allows investors, analysts and our management to compare our operating performance to the operating performance of other real estate

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FFO and normalized FFO presented herein are not necessarily identical to FFO and normalized FFO presented by other real estate companies due to the fact that not all real estate companies use the same definitions. FFO and normalized FFO should not be considered alternatives to net income (determined in accordance with GAAP) as indicators of our financial performance or as alternatives to cash flow from operating activities (determined in accordance with GAAP) as measures of our liquidity, nor are FFO and normalized FFO necessarily indicative of sufficient cash flow to fund all of our needs. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Funds From Operations" included in Item 7 of this Annual Report on Form 10-K for a reconciliation of these measures to our GAAP earnings.

ITEM 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations

        The following discussion and analysis provides information that management believes is relevant to an assessment and understanding of the consolidated results of operations and financial condition of Ventas, Inc. (together with its subsidiaries, unless otherwise indicated or except where the context otherwise requires, "we," "us" or "our"). You should read this discussion in conjunction with our Consolidated Financial Statements and the notes thereto included in Item 8 of this Annual Report on Form 10-K. This Management's Discussion and Analysis will help you understand:

Corporate and Operating Environment

        We are a real estate investment trust ("REIT") with a geographically diverse portfolio of seniors housing and healthcare properties throughout the United States and Canada. As of December 31, 2011,

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we owned 1,378 properties located in 46 states, the District of Columbia and two Canadian provinces, consisting of: 678 seniors housing communities; 396 skilled nursing facilities; 47 hospitals; 249 medical office buildings ("MOBs"); and eight personal care facilities. We also were in the process of developing three properties as of December 31, 2011. We are headquartered in Chicago, Illinois and have been a constituent member of the S&P 500® Index, a leading indicator of the large cap U.S. equities market, since March 2009.

        Our primary business focuses on acquiring and owning seniors housing and healthcare properties and leasing those properties to unaffiliated tenants or operating those properties through independent third-party managers. Through our Lillibridge Healthcare Services, Inc. ("Lillibridge") subsidiary and our ownership interest in PMB Real Estate Services LLC ("PMBRES"), which we acquired in July 2011 in connection with our acquisition of Nationwide Health Properties, Inc. (together with its subsidiaries, "NHP"), we also provide MOB management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make mortgage loan and other investments relating to seniors housing and healthcare companies or properties.

        We currently operate through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. See "Note 20—Segment Information" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

        As of December 31, 2011, we had: 100% ownership interests in 1,257 properties; controlling interests in eleven MOBs and eighteen seniors housing communities owned through joint ventures with third parties; and noncontrolling interests ranging between 5% and 25% in 58 MOBs, 20 seniors housing communities and fourteen skilled nursing facilities owned through joint ventures with third parties. Through Lillibridge and PMBRES, we also provided management and leasing services to third parties with respect to 44 MOBs as of December 31, 2011.

        As of December 31, 2011, we leased 929 properties (excluding MOBs) to healthcare operating companies under "triple-net" or "absolute-net" leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures, and we engaged independent third parties, such as Atria Senior Living, Inc. ("Atria") and Sunrise Senior Living, Inc. (together with its subsidiaries, "Sunrise"), to manage 200 seniors housing communities pursuant to long-term management agreements. Kindred Healthcare, Inc. (together with its subsidiaries, "Kindred") and Brookdale Senior Living Inc. ("Brookdale Senior Living") leased 198 and 167 of our properties, respectively, as of December 31, 2011 (excluding six properties included in investments in unconsolidated entities).

        Our business strategy focuses on three principal objectives: (1) generating consistent, reliable and growing cash flows; (2) maintaining a well-diversified portfolio; and (3) preserving our financial strength, flexibility and liquidity.

        Access to external capital is critical to the success of our business strategy as it impacts our ability to meet our existing commitments, including repaying maturing indebtedness, and to make future investments. Our access to and cost of capital depend on various factors, including general market conditions, interest rates, credit ratings on our securities, perception of our potential future earnings and cash distributions and the market price of our common stock. Generally, we attempt to match the long-term duration of our investments in senior housing and healthcare properties with long-term financing through the issuance of shares of our common stock or the incurrence of fixed rate debt. At December 31, 2011, only 22.1% of our consolidated debt was variable rate debt (excluding debt related to real estate assets classified as held for sale).

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2011 Operating Highlights and Recent Developments

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Critical Accounting Policies and Estimates

        Our Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K have been prepared in accordance with generally accepted accounting principles ("GAAP") set forth in the Accounting Standards Codification ("ASC"), as published by the Financial Accounting Standards Board ("FASB"). GAAP requires us to make estimates and assumptions regarding future events that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We base these estimates on our experience and assumptions we believe to be reasonable under the circumstances. However, if our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, we may have applied a different accounting treatment, resulting in a different presentation of our financial statements. We periodically reevaluate our estimates and assumptions, and in the event they prove to be different from actual results, we make adjustments in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. We believe that the critical accounting policies described below, among others, affect our more significant estimates and judgments used in the preparation of our financial statements. For more information regarding our critical accounting policies, see "Note 2—Accounting Policies" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

Principles of Consolidation

        The Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K include our accounts and the accounts of our wholly owned subsidiaries and the joint venture entities over which we exercise control. All intercompany transactions and balances have been eliminated in

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consolidation, and net earnings are reduced by the portion of net earnings attributable to noncontrolling interests.

        We apply FASB guidance for arrangements with variable interest entities ("VIEs"), which requires us to identify entities for which control is achieved through means other than voting rights and to determine which business enterprise is the primary beneficiary of the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity's activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity's activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity's activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. We consolidate investments in VIEs when we are determined to be the primary beneficiary of the VIE. We may change our original assessment of a VIE due to events such as modifications of contractual arrangements that affect the characteristics or adequacy of the entity's equity investments at risk and the disposal of all or a portion of an interest held by the primary beneficiary. We identify the primary beneficiary of a VIE as the enterprise that has both: (i) the power to direct the activities of the VIE that most significantly impact the entity's economic performance; and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could be significant to the entity. We perform this analysis on an ongoing basis.

        We also apply FASB guidance related to investments in joint ventures based on the type of rights held by the limited partner(s) that may preclude consolidation by the sole general partner in certain circumstances in which the general partner would otherwise consolidate the joint venture. We assess limited partners' rights and their impact on the presumption of control of the limited partnership by the sole general partner when an investor becomes the sole general partner, and we reassess if (i) there is a change to the terms or in the exercisability of the rights of the limited partners, (ii) the sole general partner increases or decreases its ownership of limited partnership interests, or (iii) there is an increase or decrease in the number of outstanding limited partnership interests. We also apply this guidance to managing member interests in limited liability companies.

Business Combinations

        We account for acquisitions using the acquisition method and allocate the cost of the properties acquired among tangible and recognized intangible assets and liabilities based upon their estimated fair values as of the acquisition date. Recognized intangibles primarily include the value of in-place leases, acquired lease contracts, tenant and customer relationships, trade names/trademarks and goodwill. We do not amortize goodwill, which represents the excess of the purchase price paid over the fair value of the net assets of the acquired business and is included in other assets on our Consolidated Balance Sheets.

        Our method for allocating the purchase price to acquired investments in real estate requires us to make subjective assessments for determining fair value of the assets acquired and liabilities assumed. This includes determining the value of the buildings, land and improvements, ground leases, tenant improvements, in-place leases, above and/or below market leases, purchase option intangible assets and/or liabilities, and any debt assumed. These estimates require significant judgment and in some cases involve complex calculations. These allocation assessments directly impact our results of operations, as amounts allocated to certain assets and liabilities have different depreciation or amortization lives. In addition, we amortize the value assigned to above and/or below market leases as a component of revenue, unlike in-place leases and other intangibles, which we include in depreciation and amortization in our Consolidated Statements of Income.

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        We estimate the fair value of buildings on an as-if-vacant basis and depreciate the building value over the estimated remaining life of the building, not to exceed 35 years. We determine the allocated value of other fixed assets, such as site improvements and furniture, fixtures and equipment, based upon the replacement cost and depreciate such value over the assets' estimated remaining useful lives as determined at the applicable acquisition date. We determine the value of land by considering the sales prices of similar properties in recent transactions or based on (a) internal analyses of recently acquired and existing comparable properties within our portfolio or (b) real estate tax assessed values in relation to the total value of the asset.

        The fair value of acquired lease intangibles, if any, reflects (i) the estimated value of any above and/or below market leases, determined by discounting the difference between the estimated market rent and the in-place rent, the resulting intangible asset or liability of which we amortize to revenue over the remaining life of the associated lease plus any bargain renewal periods, and (ii) the estimated value of in-place leases related to the cost to obtain tenants, including leasing commissions, and an estimated value of the absorption period to reflect the value of the rent and recovery costs foregone during a reasonable lease-up period as if the acquired space was vacant, which we amortize to amortization expense over the remaining life of the associated lease. If a lease were to be terminated prior to its stated expiration or not renewed, all unamortized amounts of lease intangibles would be recognized in operations at that time.

        We estimate the fair value of purchase option intangible assets or liabilities by discounting the difference between the applicable property's acquisition date fair value and an estimate of the future option price. We do not amortize the resulting intangible asset or liability over the term of the lease, but rather adjust the recognized value of the asset or liability upon exercise of the purchase option.

        We estimate the fair value of tenant or other customer relationships acquired, if any, by considering the nature and extent of existing business relationships with the tenant or customer, growth prospects for developing new business with the tenant or customer, the tenant's credit quality, expectations of lease renewals with the tenant, and the potential for significant, additional future leasing arrangements with the tenant and amortize that value over the expected life of the associated arrangements or leases, including the remaining terms of the related leases and any expected renewal periods. We estimate the fair value of trade names/trademarks using a royalty rate methodology and amortize that value over the estimated useful life of the trade name/trademark.

        In connection with a business combination, we may assume the rights and obligations under certain lease agreements pursuant to which we become the lessee of a given property. We assume the lease classification previously determined by the prior lessee absent a modification in the assumed lease agreement. In connection with our recent acquisitions, all capital leases acquired or assumed contain bargain purchase options that we intend to exercise. Therefore, we recognized an asset based on the acquisition date fair value of the underlying property and a liability based on the acquisition date fair value of the capital lease obligation. We depreciate assets recognized under capital leases that contain bargain purchase options over the asset's useful life. We assess assumed operating leases, including ground leases, to determine whether the lease terms are favorable or unfavorable given current market conditions on the acquisition date. To the extent the lease terms are favorable or unfavorable relative to market conditions on the acquisition date, we recognize an intangible asset or liability, respectively, at fair value, and we amortize the recognized asset or liability (excluding purchase option intangibles) to interest or rental expense in our Consolidated Statements of Income over the applicable lease term. We include all lease-related intangible assets and all lease-related intangible liabilities within acquired lease intangibles and accounts payable and other liabilities, respectively, on our Consolidated Balance Sheets.

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        We determine fair value of loans receivable acquired in connection with a business combination by discounting the estimated future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The estimated future cash flows reflect our judgment regarding the uncertainty of those cash flows, so we do not establish a valuation allowance at the acquisition date. We recognize the difference between the acquisition date fair value and the total expected cash flows as interest income using an effective interest method over the life of the applicable loan. Subsequent to the acquisition date, we evaluate changes regarding the uncertainty of future cash flows and the need for a valuation allowance.

        We estimate the fair value of noncontrolling interests assumed using assumptions that are consistent with those used in valuing all of the underlying assets and liabilities.

        We base the initial carrying value of investments in unconsolidated entities on the fair value of the assets at the time we acquired the joint venture interest. We estimate fair values for our equity method investments based on discounted cash flow models that include all estimated cash inflows and outflows over a specified holding period and, where applicable, any estimated debt premiums or discounts. The capitalization rates, discount rates and credit spreads we use in these models are based upon assumptions that we believe to be within a reasonable range of current market rates for the respective investments.

        We generally amortize any difference between our cost basis and the basis reflected at the joint venture level over the lives of the related assets and liabilities and include it in our share of income or loss from unconsolidated entities. In other instances, net income or loss is allocated between the partners in the joint venture based on the hypothetical liquidation at book value method.

        We calculate the fair value of long-term debt by discounting the remaining contractual cash flows on each instrument at the current market rate for those borrowings, which we approximate based on the rate we would expect to incur to replace the instrument on the date of acquisition, and recognize any fair value adjustments related to long-term debt as effective yield adjustments over the remaining term of the instrument.

        We record a liability for contingent consideration (included in accounts payable and other liabilities on our Consolidated Balance Sheets) at fair value as of the acquisition date and reassess the fair value at the end of each reporting period, with any changes being recognized in earnings. Increases or decreases in the fair value of contingent consideration can result from changes in discount periods, discount rates and probabilities that contingencies will be met.

Impairment of Long-Lived and Intangible Assets

        We periodically evaluate our long-lived assets, primarily consisting of our investments in real estate, for impairment indicators. If indicators of impairment are present, we evaluate the carrying value of the related real estate investments in relation to the future undiscounted cash flows of the underlying operations. In performing this evaluation, we consider market conditions as well as our intent with respect to holding or disposing of the asset. We adjust the net book value of leased properties and other long-lived assets to fair value if the sum of the expected future undiscounted cash flows, including sales proceeds, is less than book value. We recognize an impairment loss at the time we make any such determination.

        If impairment indicators arise with respect to intangible assets with finite useful lives, we evaluate impairment by comparing the carrying amount of the asset to the estimated future undiscounted net cash flows to be generated by the asset. If estimated future undiscounted net cash flows are less than the carrying amount of the asset, then we estimate the fair value of the asset. We determine the impairment loss by comparing the estimated fair value of the intangible asset to its carrying value and recognize any shortfall from fair value as a loss in the current period.

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        We evaluate our equity method investments for impairment whenever events or changes in circumstances indicate that the carrying value of our investment in an unconsolidated joint venture may exceed the fair value. If it is determined that a decline in the fair value of our investment in an unconsolidated joint venture is other-than-temporary, and if such reduced fair value is below its carrying value, an impairment is recorded. The determination of the fair value of investments in unconsolidated joint ventures involves significant judgment. Our estimates consider all available evidence, including, as appropriate, the present value of the expected future cash flows discounted at market rates, general economic conditions and trends and other relevant factors.

        Goodwill is tested for impairment at least annually, but more frequently if indicators arise. We first assess qualitative factors to determine the likelihood that the fair value of a reporting unit is less than its carrying amount. Qualitative factors we assess include current macroeconomic conditions, state of the equity and capital markets and our overall financial and operating performance. If we determine it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then we proceed with the two-step approach to evaluating impairment. In the first step of this approach, we estimate the fair value of a reporting unit and compare it to the reporting unit's carrying value. Should the carrying value exceed fair value, we proceed with the second step. The second step of this approach requires the fair value of a reporting unit to be assigned to all the assets and liabilities of the reporting unit as if it had been acquired in a business combination at the date of the impairment test. The excess fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied value of goodwill and is used to determine the amount of impairment. We recognize an impairment loss to the extent the carrying value of goodwill exceeds the implied value in the current period.

        Estimates of fair value used in this evaluation of goodwill, investments in real estate and intangibles are based upon discounted future cash flow projections, which are, in turn, based upon a number of estimates and assumptions, such as revenue and expense growth rates and discount rates. Our ability to accurately predict future operating results and cash flows and estimate and allocate fair values impacts the timing and recognition of impairments. While we believe our assumptions are reasonable, changes in these assumptions may have a material impact on our financial results.

Loans Receivable

        We record loans receivable, other than those acquired in connection with a business combination, on our Consolidated Balance Sheets (either in secured loans receivable, net or, with respect to unsecured loans receivable, other assets) at the unpaid principal balance, net of any deferred origination fees, purchase discounts or premiums and valuation allowances. We amortize net deferred origination fees, which are comprised of loan fees collected from the borrower net of certain direct costs, and purchase discounts or premiums over the contractual life of the loan using the effective interest method and recognize any unamortized balances in income immediately if the loan is repaid before its contractual maturity.

        We regularly evaluate the collectibility of loans receivable based on several factors, including without limitation (i) corporate and facility-level financial and operational reports, (ii) compliance with any financial covenants set forth in the applicable loan agreement, (iii) the financial strength of the borrower and any guarantor, (iv) the payment history of the borrower, and (v) current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to collect all amounts due according to the terms of the applicable loan agreement, we provide a reserve against the portion of the receivable that we estimate may not be collected.

Fair Value

        We follow FASB guidance that defines fair value and provides direction for measuring fair value and making the necessary related disclosures. The guidance emphasizes that fair value is a market-

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based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels one and two of the hierarchy) and the reporting entity's own assumptions about market participant assumptions (unobservable inputs classified within level three of the hierarchy).

        Level one inputs utilize unadjusted quoted prices for identical assets or liabilities in active markets that the reporting entity has the ability to access. Level two inputs are inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets, as well as other inputs for the asset or liability, such as interest rates, foreign exchange rates and yield curves, that are observable at commonly quoted intervals. Level three inputs are unobservable inputs for the asset or liability, which are typically based on the reporting entity's own assumptions, as there is little, if any, related market activity. If the determination of the fair value measurement is based on inputs from different levels of the hierarchy, the level within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. If an entity determines there has been a significant decrease in the volume and level of activity for an asset or liability relative to the normal market activity for such asset or liability (or similar assets or liabilities), then transactions or quoted prices may not accurately reflect fair value. In addition, if there is evidence that the transaction for the asset or liability is not orderly, the entity shall place little, if any, weight on that transaction price as an indicator of fair value. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Revenue Recognition

        Certain of our triple-net leases, including the majority of our leases with Brookdale Senior Living and the majority of leases we acquired in connection with the NHP acquisition, and most of our MOB leases provide for periodic and determinable increases in base rent. We recognize base rental revenues under these leases on a straight-line basis over the applicable lease term when collectibility is reasonably assured. Recognizing rental income on a straight-line basis results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in other assets on our Consolidated Balance Sheets.

        Our master lease agreements with Kindred (the "Kindred Master Leases") and certain of our other leases provide for periodic increases in base rent only if certain revenue parameters or other substantive contingencies are met. We recognize the increased rental revenue under these leases as the related parameters or contingencies are met, rather than on a straight-line basis over the applicable lease term.

        We recognize resident fees and services, other than move-in fees, monthly as services are provided. We recognize move-in fees on a straight-line basis over the average resident stay. Our lease agreements with residents generally have a term of twelve to eighteen months and are cancelable by the resident upon 30 days' notice.

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        We recognize interest income from loans, including discounts and premiums, using the effective interest method when collectibility is reasonably assured. We apply the effective interest method on a loan-by-loan basis and recognize discounts and premiums as yield adjustments over the related loan term. We recognize interest income on an impaired loan to the extent our estimate of the fair value of the collateral is sufficient to support the balance of the loan, other receivables and all related accrued interest. When the balance of the loan, other receivables and all related accrued interest is equal to our estimate of the fair value of the collateral, we recognize interest income on a cash basis. We provide a reserve against an impaired loan to the extent our total investment in the loan exceeds our estimate of the fair value of the loan collateral.

        We recognize income from rent, lease termination fees, development services, management advisory services and all other income when all of the following criteria are met in accordance with Securities and Exchange Commission ("SEC") Staff Accounting Bulletin 104: (i) the applicable agreement has been fully executed and delivered; (ii) services have been rendered; (iii) the amount is fixed or determinable; and (iv) collectibility is reasonably assured.

        We assess the collectibility of our rent receivables, including straight-line rent receivables, in accordance with the applicable accounting standards and our reserve policy, and we defer recognition of revenue if collectibility is not reasonably assured. We base our assessment of the collectibility of rent receivables (excluding straight-line receivables) on several factors, including, among other things, payment history, the financial strength of the tenant and any guarantors, the value of the underlying collateral, if any, and current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to recover the full value of the receivable, we provide a reserve against the portion of the receivable that we estimate may not be recovered. We base our assessment of the collectibility of straight-line receivables on several factors, including, among other things, the financial strength of the tenant and any guarantors, the historical operations and operating trends of the property, the historical payment pattern of the tenant, and the type of property. If our evaluation of these factors indicates it is probable that we will be unable to receive the rent payments due in the future, we defer recognition of the straight-line rental income and, in certain circumstances, provide a reserve against the previously recognized straight-line rent receivable asset for a portion, up to its full value, that we estimate may not be recovered. If we change our assumptions or estimates regarding the collectibility of future rent payments required by a lease, we may adjust our reserve to increase or reduce the rental revenue recognized and/or to increase or reduce the reserve against the existing straight-line rent receivable.

Federal Income Tax

        We have elected to be treated as a REIT under the applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"), for every year beginning with the year ended December 31, 1999 and made no provision for federal income tax purposes prior to our acquisition of the assets of Sunrise Senior Living Real Estate Investment Trust ("Sunrise REIT") in April 2007. As a result of the Sunrise REIT and subsequent acquisitions, we now record income tax expense or benefit with respect to certain of our entities that are taxed as "taxable REIT subsidiaries" under provisions similar to those applicable to regular corporations and not under the REIT provisions.

        We account for deferred income taxes using the asset and liability method and recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in our financial statements or tax returns. Under this method, we determine deferred tax assets and liabilities based on the differences between the financial reporting and tax bases of assets and liabilities

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using enacted tax rates in effect for the year in which the differences are expected to reverse. Any increase or decrease in the deferred tax liability that results from a change in circumstances, and that causes a change in our judgment about expected future tax consequences of events, is included in the tax provision when such changes occur. Deferred income taxes also reflect the impact of operating loss and tax credit carryforwards. A valuation allowance is provided if we believe it is more likely than not that all or some portion of the deferred tax asset will not be realized. Any increase or decrease in the valuation allowance that results from a change in circumstances, and that causes a change in our judgment about the realizability of the related deferred tax asset, is included in the tax provision when such changes occur.

Recently Issued or Adopted Accounting Standards

        In December 2011, the FASB issued Accounting Standards Update ("ASU") 2011-10, Derecognition of in Substance Real Estate—a Scope Clarification ("ASU 2011-10"), which clarifies certain guidance for situations in which a reporting entity ceases to have a controlling financial interest in a subsidiary that is, in substance, real estate as a result of default on the subsidiary's nonrecourse debt. In such situations, ASU 2011-10 requires a company to apply the provisions of ASC Topic 360, Property, Plant, and Equipment, in determining whether it should derecognize the real estate assets. The provisions of ASU 2011-10 will be effective for us beginning with fiscal year 2013, and are not expected to have a significant impact on our Consolidated Financial Statements.

        In September 2011, the FASB issued ASU 2011-08, Testing Goodwill for Impairment ("ASU 2011-08"), which permits companies to first assess qualitative factors to determine the likelihood that the fair value of a reporting unit is less than its carrying amount before performing the current two-step analysis. If a company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the company must proceed with the two-step approach to evaluating impairment. We adopted the provisions of ASU 2011-08 in 2011, and the adoption did not impact our Consolidated Financial Statements. Also, on January 1, 2011, we adopted ASU 2010-28, When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts ("ASU 2010-28"). ASU 2010-28 states that if a reporting unit has a carrying amount that is equal to or less than zero and there are qualitative factors that indicate it is more likely than not that a goodwill impairment exists, Step 2 of the goodwill impairment test must be performed. The adoption of ASU 2010-28 also did not impact our Consolidated Financial Statements.

        In June 2011, the FASB issued ASU 2011-05, Presentation of Comprehensive Income ("ASU 2011-05"), which amends current guidance found in ASC Topic 220, Comprehensive Income. ASU 2011-05 requires entities to present comprehensive income in either: (i) one continuous financial statement or (ii) two separate but consecutive statements that display net income and the components of other comprehensive income. Totals and individual components of both net income and other comprehensive income must be included in either presentation. In December 2011, the FASB issued ASU 2011-12, Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05 ("ASU 2011-12"). The provisions of ASU 2011-12 indefinitely defer portions of ASU 2011-05 related to the presentation of reclassification of items out of accumulated other comprehensive income. The provisions of both ASU 2011-05 and ASU 2011-12 will be effective for us beginning with the first quarter of 2012.

        On January 1, 2011, we adopted ASU 2010-29, Disclosure of Supplementary Pro Forma Information for Business Combinations ("ASU 2010-29"), affecting public entities that enter into business combinations that are material on an individual or aggregate basis. ASU 2010-29 specifies that if a public entity presents comparative financial statements, it should disclose revenues and earnings of the combined entity as though the business combination(s) that occurred during the year had occurred at the beginning of the prior annual reporting period when preparing the pro forma financial information

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for both the current and prior reporting periods. The guidance, which is effective for business combinations consummated in reporting periods beginning after December 15, 2010, also requires that pro forma disclosures be accompanied by a narrative description regarding the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination(s) included in reported pro forma revenues and earnings. We have presented supplementary pro forma information related to our acquisition of substantially all of the real estate assets and working capital of ASLG in May 2011 and our acquisition of NHP in July 2011 in "Note 4—Acquisitions of Real Estate Property" included in Item 8 of this Annual Report on Form 10-K.

        In January 2010, the FASB issued ASU 2010-06, Improving Disclosures about Fair Value Measurements ("ASU 2010-06"), which expands required disclosures related to an entity's fair value measurements. Certain provisions of ASU 2010-06 were effective for interim and annual reporting periods beginning after December 15, 2009, and we adopted those provisions as of January 1, 2010. The remaining provisions, which were effective for interim and annual reporting periods beginning after December 15, 2010, require additional disclosures related to purchases, sales, issuances and settlements in an entity's reconciliation of recurring level three investments. We adopted those provisions of ASU 2010-06 as of January 1, 2011. The adoption of ASU 2010-06 did not impact our Consolidated Financial Statements.

Results of Operations

        As of December 31, 2011, we operated through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. Our triple-net leased properties segment consists of acquiring and owning seniors housing and healthcare properties in the United States and leasing those properties to healthcare operating companies under "triple-net" or "absolute-net" leases that require the tenants to pay all property-related expenses. Our senior living operations segment primarily consists of investments in seniors housing communities located in the United States and Canada for which we engage independent third parties, such as Atria and Sunrise, to manage the operations. Our MOB operations segment primarily consists of acquiring, owning, developing, leasing and managing MOBs. Information provided for "all other" includes revenues such as income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to our three reportable business segments. Assets included in all other consist primarily of corporate assets, including cash, restricted cash, deferred financing costs, loans receivable and miscellaneous accounts receivable.

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Years Ended December 31, 2011 and 2010

        The table below shows our results of operations for each year and the effect on our income of changes in those results from year to year.

 
  For the Year Ended
December 31,
  Increase (Decrease) to
Income
 
 
  2011   2010   $   %  
 
  (Dollars in thousands)
 

Segment NOI:

                         

Triple-Net Leased Properties

  $ 654,794   $ 461,709   $ 193,085     41.8 %

Senior Living Operations

    279,331     154,470     124,861     80.8  

MOB Operations

    116,591     50,205     66,386     >100  

All Other

    34,415     16,412     18,003     >100  
                     

Total segment NOI

    1,085,131     682,796     402,335     58.9  

Interest and other income

    1,217     484     733     >100  

Interest expense

    (236,807 )   (175,631 )   (61,176 )   (34.8 )

Depreciation and amortization

    (456,590 )   (203,762 )   (252,828 )   (>100 )

General, administrative and professional fees

    (74,537 )   (49,830 )   (24,707 )   (49.6 )

Loss on extinguishment of debt

    (27,604 )   (9,791 )   (17,813 )   (>100 )

Litigation proceeds, net

    202,259         202,259     nm  

Merger-related expenses and deal costs

    (153,923 )   (19,243 )   (134,680 )   (>100 )

Other

    (8,653 )   (272 )   (8,381 )   (>100 )
                     

Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest

    330,493     224,751     105,742     47.0  

Loss from unconsolidated entities

    (52 )   (664 )   612     92.2  

Income tax benefit (expense)

    31,137     (5,201 )   36,338     (>100 )
                     

Income from continuing operations

    361,578     218,886     142,692     65.2  

Discontinued operations

    1,683     30,843     (29,160 )   (94.5 )
                     

Net income

    363,261     249,729     113,532     45.5  

Net (loss) income attributable to noncontrolling interest, net of tax

    (1,232 )   3,562     4,794     (>100 )
                     

Net income attributable to common stockholders

  $ 364,493   $ 246,167   $ 118,326     48.1 %
                     

nm—not
meaningful 

Segment NOI—Triple-Net Leased Properties

        NOI for our triple-net leased properties reportable business segment consists of rental income earned from our triple-net assets and other services revenue. We incur no direct operating expenses for this segment.

        Triple-net leased properties segment NOI increased primarily due to $179.2 million of rental income from the properties we acquired in connection with the NHP acquisition, $6.0 million of additional rent resulting from the annual escalators in the rent paid under the Kindred Master Leases effective May 1, 2011, other services revenue directly attributable to the NHP acquisition ($2.2 million) and various rent increases at our other existing triple-net leased properties.

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        In our triple-net leased properties segment, revenues consist of fixed rental amounts (subject to annual escalations) received directly from our tenants in accordance with the applicable lease terms and generally do not depend on the operating performance of our properties. Accordingly, occupancy information is relevant to the profitability of our tenants' operations but does not directly impact our revenues or financial results. The following table sets forth average occupancy rates related to the triple-net leased properties we owned at December 31, 2011 for the third quarter of 2011, which is the most recent information available to us from our tenants.

 
  Number of
Properties at
December 31, 2011
  Average Occupancy
For the Three Months
Ended September 30,
2011
 

Seniors Housing Communities

    458     86.0 %

Skilled Nursing Facilities

    382     83.6 %

Hospitals

    47     56.3 %

Segment NOI—Senior Living Operations

        The following table summarizes our senior living operations reportable business segment NOI:

 
  For the Year Ended
December 31,
  Increase (Decrease)
to Income
 
 
  2011   2010   $   %  
 
  (Dollars in thousands)
 

Segment NOI—Senior Living Operations:

                         

Total revenues

  $ 873,308   $ 446,301   $ 427,007     95.7 %

Less:

                         

Property-level operating expenses

    (593,977 )   (291,831 )   (302,146 )   >100  
                     

Segment NOI

  $ 279,331   $ 154,470   $ 124,861     80.8 %
                     

        In our senior living operations segment, revenues consist of resident fees and services, which include all amounts earned from residents at our seniors housing communities, such as rental fees related to resident leases, extended health care fees and other ancillary service income. Our senior living operations segment revenues increased primarily due to the properties we acquired in connection with the ASLG acquisition ($403.2 million) and an increase in average daily rates. The following table sets forth average resident occupancy rates related to our senior living operating properties during 2011 and 2010:

 
  Number of
Properties at
December 31,
  Average
Occupancy
For the Year
Ended
December 31,
 
 
  2011   2010   2011(1)   2010  

Stabilized Communities

    188     80     89.2 %   89.1 %

Lease-Up Communities

    12     2     78.7 %   84.3 %
                       

Total

    200     82     88.6 %   88.9 %
                       

Same-Store Stabilized Communities

    79     79     90.0 %   89.2 %

(1)
Occupancy related to the seniors housing communities acquired in connection with the ASLG acquisition reflects activity from May 12, 2011, the date of the acquisition, through December 31, 2011.

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        Property-level operating expenses related to the segment include labor, food, utility, marketing, management and other costs of operating the properties. Property-level operating expenses increased in 2011 over 2010 primarily due to the properties we acquired in connection with the ASLG acquisition ($281.1 million) and the receipt of a $5 million cash payment from Sunrise in 2010 for expense overages.

Segment NOI—MOB Operations

        The following table summarizes our MOB operations reportable business segment NOI:

 
  For the Year Ended
December 31,
  Increase (Decrease)
to Income
 
 
  2011   2010   $   %  
 
  (Dollars in thousands)
 

Segment NOI—MOB Operations:

                         

Rental income

  $ 167,003   $ 69,747   $ 97,256     >100 %

Medical office building services revenue

    34,254     14,098     20,156     >100  
                     

Total revenues

    201,257     83,845     117,412     >100  

Less:

                         

Property-level operating expenses

    (57,584 )   (24,122 )   (33,462 )   (>100 )

Medical office building services costs

    (27,082 )   (9,518 )   (17,564 )   (>100 )
                     

Segment NOI

  $ 116,591   $ 50,205   $ 66,386     >100 %
                     

nm—not
meaningful 

        The increases in MOB operations segment revenues and property-level operating expenses are attributed primarily to the MOBs we acquired in connection with the NHP acquisition ($68.6 million) and a full of year of activity related to the MOBs we acquired in 2010 in connection with the Lillibridge acquisition. The following table sets forth occupancy rates related to our MOB operations segment at December 31, 2011 and 2010:

 
  Number of
Properties at
December 31,
  Occupancy at
December 31,
 
 
  2011   2010   2011   2010  

Stabilized MOBs

    177     63     91.9 %   94.8 %

Non-Stabilized MOBs

    14     6     73.3 %   73.9 %
                       

Total

    191     69     89.5 %   91.5 %
                       

Same-Store Stabilized MOBs

    63     63     94.0 %   94.7 %

        Medical office building services revenue and costs, which are a direct result of the Lillibridge businesses that we acquired in July 2010, both increased due primarily due to a full year of activity in 2011 and increased construction activity during the second half of 2011 compared to 2010.

Segment NOI—All Other

        All other NOI consists solely of income from loans and investments. Income from loans and investments increased in 2011 over the prior year primarily due to the loans receivable we acquired in connection with the NHP acquisition, gains from the sale of marketable debt securities and additional investments we made in loans receivable during 2010 and 2011, partially offset by decreased interest income related to loans receivable repayments we received during 2011.

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Interest Expense

        The $62.1 million increase in total interest expense, including interest allocated to discontinued operations of $5.3 million and $4.3 million for the years ended December 31, 2011 and 2010, respectively, is attributed primarily to a $117.6 million increase in interest due to higher loan balances and $7.7 million of interest related to the capital leases we assumed in our 2011 acquisitions, partially offset by a $65.1 million decrease in interest due to lower effective interest rates, including the amortization of any fair value adjustments. Our effective interest rate, excluding activity related to our capital leases, was 4.9% for 2011, compared to 6.4% for 2010. A decrease in the average Canadian dollar exchange rate had an unfavorable impact on interest expense of $0.2 million for 2011, versus 2010.

Depreciation and Amortization

        Depreciation and amortization expense increased primarily due to the NHP and ASLG acquisitions and other properties we acquired in 2011.

General, Administrative and Professional Fees

        General, administrative and professional fees increased in 2011 primarily due to our organizational growth.

Loss on Extinguishment of Debt

        The loss on extinguishment of debt in 2011 resulted from our early repayment in February 2011 of $307.2 million principal amount of existing mortgage debt, our redemption in July 2011 of $200.0 million principal amount of our 61/2% senior notes due 2016 and our termination in October 2011 of our previous unsecured revolving credit facilities. The loss on extinguishment of debt in 2010 resulted from our redemption in June 2010 of all $142.7 million principal amount outstanding of our 71/8% senior notes due 2015, our redemption in October 2010 of all $71.7 million principal amount outstanding of our 65/8% senior notes due 2014 and various mortgage debt repayments in December 2010.

Litigation Proceeds, Net

        Litigation proceeds, net in 2011 reflects our receipt of $102.8 million in payment of the compensatory damages award from HCP arising out of our 2007 Sunrise REIT acquisition, plus certain costs and interest, and the receipt of an additional $125 million from HCP in final settlement of our outstanding lawsuit against HCP, net of certain fees and expenses, the contingent fee for our outside legal counsel and donations to the Ventas Charitable Foundation. No similar events occurred during 2010.

Merger-Related Expenses and Deal Costs

        Merger-related expenses and deal costs in both years consisted of expenses relating to our favorable $101.6 million compensatory damages judgment against HCP and subsequent cross-appeals, transition and integration expenses related to consummated transactions and deal costs required by GAAP to be expensed rather than capitalized into the asset value. The transition and integration expenses and deal costs reflect certain fees and expenses incurred in connection with the Lillibridge, ASLG and NHP acquisitions.

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Other

        Other consists primarily of the fair value adjustment on interest rate swaps we acquired in connection with the ASLG and NHP acquisitions, partially offset by other expenses.

Loss from Unconsolidated Entities

        Loss from unconsolidated entities for 2011 and 2010 relates to the noncontrolling interests in joint ventures we acquired in connection with the NHP and Lillibridge acquisitions. At December 31, 2011, these noncontrolling interests ranged between 5% and 25% and related to 58 MOBs, 20 seniors housing communities and fourteen skilled nursing facilities.

Income Tax Benefit/Expense

        Income tax benefit for 2011 was due primarily to the reversal of certain income tax contingency reserves, including interest, related to our 2007 U.S. federal income tax returns and the deferred tax liabilities established in connection with the ASLG acquisition. Income tax expense for 2010 represents amounts related to our taxable REIT subsidiaries as a result of the Sunrise REIT acquisition.

Discontinued Operations

        Discontinued operations for 2011 includes activity related to nineteen properties, four of which were sold during 2011 with no resulting gain or loss and fifteen of which were classified as held for sale as of December 31, 2011. Discontinued operations for 2010 includes activity related to nine of the nineteen properties mentioned above that we owned during 2010, a $17.3 million gain on the sale of seven assets sold during 2010, lease termination fees of $0.7 million related to these assets and a $7.9 million previously deferred gain recognized in the fourth quarter of 2010 upon repayment of a note to the buyer.

Net Loss/Income Attributable to Noncontrolling Interest

        Net loss attributable to noncontrolling interest for 2011 represents our partners' joint venture interests in 29 MOBs and seniors housing communities, 23 of which we acquired in connection with the NHP acquisition. Net income attributable to noncontrolling interest, net of tax for 2010 represents Sunrise's share of net income from its previous ownership interests in 60 of our seniors housing communities, which we acquired during 2010, and our partners' joint venture interests in six MOBs.

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Years Ended December 31, 2010 and 2009

        The table below shows our results of operations for each year and the effect on our income of changes in those results from year to year.

 
  For the Year Ended
December 31,
  Increase (Decrease)
to Income
 
 
  2010   2009   $   %  
 
  (Dollars in thousands)
 

Segment NOI:

                         

Triple-Net Leased Properties

  $ 461,709   $ 452,536   $ 9,173     2.0 %

Senior Living Operations

    154,470     131,013     23,457     17.9  

MOB Operations

    50,205     23,154     27,051     >100  

All Other

    16,412     13,107     3,305     25.2  
                     

Total segment NOI

    682,796     619,810     62,986     10.2  

Interest and other income

    484     842     (358 )   (42.5 )

Interest expense

    (175,631 )   (173,810 )   (1,821 )   (1.0 )

Depreciation and amortization

    (203,762 )   (197,298 )   (6,464 )   (3.3 )

General, administrative and professional fees

    (49,830 )   (38,830 )   (11,000 )   (28.3 )

Loss on extinguishment of debt

    (9,791 )   (6,080 )   (3,711 )   (61.0 )

Merger-related expenses and deal costs

    (19,243 )   (13,015 )   (6,228 )   (47.9 )

Other

    (272 )   (50 )   (222 )   (>100 )
                     

Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest

    224,751     191,569     33,182     17.3  

Loss from unconsolidated entities

    (664 )       (664 )   nm  

Income tax (expense) benefit

    (5,201 )   1,719     (6,920 )   (>100 )
                     

Income from continuing operations

    218,886     193,288     25,598     13.2  

Discontinued operations

    30,843     76,072     (45,229 )   (59.5 )
                     

Net income

    249,729     269,360     (19,631 )   (7.3 )

Net income attributable to noncontrolling interest, net of tax

    3,562     2,865     (697 )   (24.3 )
                     

Net income attributable to common stockholders

  $ 246,167   $ 266,495   $ (20,328 )   (7.6 )%
                     

nm—not
meaningful 

Segment NOI—Triple-Net Leased Properties

        Triple-net leased properties reportable business segment NOI increased primarily due to $6.2 million of additional rent resulting from the annual escalators in the rent paid under the Kindred Master Leases effective May 1, 2010, $0.8 million of rental income from a seniors housing community we acquired in 2010 and various rent increases at our other existing properties.

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Segment NOI—Senior Living Operations

        The following table summarizes our senior living operations reportable business segment NOI:

 
  For the Year Ended
December 31,
  Increase
(Decrease)
to Income
 
 
  2010   2009   $   %  
 
  (Dollars in thousands)
 

Segment NOI—Senior Living Operations:

                         

Total revenues

  $ 446,301   $ 421,058   $ 25,243     6.0 %

Less:

                         

Property-level operating expenses

    (291,831 )   (290,045 )   (1,786 )   (0.6 )
                     

Segment NOI

  $ 154,470   $ 131,013   $ 23,457     17.9 %
                     

        Our senior living operations segment revenues increased primarily due to a decrease in the average Canadian dollar exchange rate, which had a favorable impact of $8.2 million in 2010, $3.3 million of resident fees and services from three seniors housing communities added to our portfolio in 2010 and late 2009, higher occupancy rates and an increase in average daily rates. The following table sets forth average resident occupancy rates related to our senior living operating properties during 2010 and 2009:

 
  Number of
Properties at
December 31,
  Average
Occupancy For
the Year
Ended
December 31,
 
 
  2010   2009   2010   2009  

Stabilized Communities

    80     78     89.1 %   88.3 %

Lease-Up Communities

    2     1     84.3 %   70.4 %
                       

Total

    82     79     88.9 %   87.7 %
                       

Same-Store Stabilized Communities

    78     78     89.1 %   88.3 %

        Property-level operating expenses increased primarily as a result of a decrease in the average Canadian dollar exchange rate, which had an unfavorable impact of $5.4 million in 2010, $3.1 million of additional expenses from the three seniors housing communities we acquired in 2010 and late 2009 and increased expenses related to occupancy and revenue growth, partially offset by the receipt of a $5 million cash payment from Sunrise in 2010 for expense overages and a decrease of $4.2 million in management fees.

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Segment NOI—MOB Operations

        The following table summarizes our MOB operations reportable business segment NOI:

 
  For the Year Ended
December 31,
  Increase (Decrease)
to Income
 
 
  2010   2009   $   %  
 
  (Dollars in thousands)
 

Segment NOI—MOB Operations:

                         

Rental income

  $ 69,747   $ 35,922   $ 33,825     94.2 %

Medical office building services revenue

    14,098         14,098     nm  
                     

Total revenues

    83,845     35,922     47,923     >100  

Less:

                         

Property-level operating expenses

    (24,122 )   (12,768 )   (11,354 )   (88.9 )

Medical office building services costs

    (9,518 )       (9,518 )   nm  
                     

Segment NOI

  $ 50,205   $ 23,154   $ 27,051     >100 %
                     

nm—not
meaningful 

        The increases in MOB operations segment revenues and property-level operating expenses are attributed primarily to the MOBs we acquired during 2010 and 2009, including the Lillibridge portfolio. The following table sets forth occupancy rates related to our MOB operations segment at December 31, 2010 and 2009:

 
  Number of
Properties at
December 31,
  Occupancy at
December 31,
 
 
  2010   2009   2010   2009  

Stabilized MOBs

    63     21     94.8 %   94.9 %

Non-Stabilized MOBs

    6     5     73.9 %   73.9 %
                       

Total

    69     26     91.5 %   89.6 %
                       

Same-Store Stabilized MOBs

    18     18     93.2 %   93.9 %

Segment NOI—All Other

        All other NOI consists solely of income from loans and investments. Income from loans and investments increased in 2010 over the prior year primarily due to interest earned on the investments we made during 2010 and 2009.

Interest Expense

        The $0.2 million increase in total interest expense, including interest allocated to discontinued operations of $4.3 million and $5.9 million for the years ended December 31, 2010 and 2009, respectively, is due primarily to increased deferred financing fee amortization, increased land lease payments and a $0.4 million increase in interest from higher effective interest rates, partially offset by a $2.7 million reduction in interest from lower loan balances. Interest expense includes $9.0 million and $7.4 million of amortized deferred financing fees for 2010 and 2009, respectively. Our effective interest rate was 6.4% for 2010, compared to 6.3% for 2009. A decrease in the average Canadian dollar exchange rate had an unfavorable impact on interest expense of $0.7 million in 2010, compared to 2009.

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Depreciation and Amortization

        Depreciation and amortization expense increased primarily as a result of the properties we acquired or developed during 2010 and 2009, including the Lillibridge portfolio.

General, Administrative and Professional Fees

        General, administrative and professional fees increased $11.0 million in 2010 over 2009 due primarily to our organizational growth as a result of the Lillibridge acquisition.

Loss on Extinguishment of Debt

        The loss on extinguishment of debt in 2010 relates primarily to our redemption in June 2010 of all $142.7 million principal amount then outstanding of our 71/8% senior notes due 2015, our redemption in October 2010 of all $71.7 million principal amount then outstanding of our 65/8% senior notes due 2014 and various mortgage repayments in December 2010. The loss on extinguishment of debt in 2009 primarily relates to the purchase, in open market transactions and/or through cash tender offers, of $361.6 million aggregate principal amount of our outstanding senior notes.

Merger-Related Expenses and Deal Costs

        Merger-related expenses and deal costs consisted of expenses relating to our favorable $101.6 million jury verdict against HCP and subsequent cross-appeals arising out of our Sunrise REIT acquisition, integration costs related to consummated transactions and deal costs required by GAAP to be expensed rather than capitalized into the asset value, which include certain fees and expenses we incurred in connection with the Lillibridge and ASLG acquisitions.

Other

        Other in 2010 resulted primarily from the net change in our forward contract valuation compared to the revaluation of intercompany loans, partially offset by the Canadian exchange rate differential between the trade date and settlement date on a cash payment.

Loss from Unconsolidated Entities

        Loss from unconsolidated entities in 2010 relates to the noncontrolling interests in joint ventures we acquired as part of the Lillibridge acquisition. At December 31, 2010, we had ownership interests ranging between 5% and 20% in 58 MOBs. See "Note 4Acquisitions of Real Estate Property" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

Income Tax Expense/Benefit

        Income tax expense/benefit before noncontrolling interest in 2010 and 2009 represents amounts related to our taxable REIT subsidiaries as a result of the Sunrise REIT and Lillibridge acquisitions. The change from an income tax benefit in 2009 to a non-cash income tax expense in 2010 is primarily due to increased NOI at our Sunrise-managed seniors housing communities. See "Note 13Income Taxes" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

Discontinued Operations

        Discontinued operations for 2010 includes a $17.3 million gain on the sale of seven assets sold during 2010, lease termination fees of $0.7 million related to these assets and a $7.9 million previously deferred gain recognized in the fourth quarter of 2010 upon repayment of a note to the buyer.

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Discontinued operations for 2009 includes a $66.8 million net gain on the sale of fourteen assets sold during 2009 and a lease termination fee of $2.3 million related to these assets.

Net Income Attributable to Noncontrolling Interest

        Net income attributable to noncontrolling interest, net of tax primarily represents Sunrise's share of net income from its previous ownership percentage in 60 of our seniors housing communities during 2009 and 58 of our seniors housing communities during most of 2010.

Non-GAAP Financial Measures

        We believe that net income, as defined by GAAP, is the most appropriate earnings measurement. However, we consider certain non-GAAP financial measures to be useful supplemental measures of our operating performance. A non-GAAP financial measure is generally defined as one that purports to measure historical or future financial performance, financial position or cash flows, but excludes or includes amounts that would not be so adjusted in the most comparable GAAP measure. Set forth below are descriptions of the non-GAAP financial measures we consider most relevant to our business and useful to investors, as well as reconciliations of these measures to our most directly comparable GAAP financial measures.

        The non-GAAP financial measures we present herein are not necessarily identical to those presented by other real estate companies due to the fact that not all real estate companies use the same definitions. These measures should not be considered as alternatives to net income (determined in accordance with GAAP) as indicators of our financial performance or as alternatives to cash flow from operating activities (determined in accordance with GAAP) as measures of our liquidity, nor are these measures necessarily indicative of sufficient cash flow to fund all of our needs. We believe that in order to facilitate a clear understanding of our consolidated historical operating results, these measures should be examined in conjunction with net income as presented in our Consolidated Financial Statements and data included elsewhere in this Annual Report on Form 10-K.

Funds From Operations and Normalized Funds From Operations

        Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values, instead, have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. To overcome this problem, we consider Funds From Operations ("FFO") and normalized FFO appropriate measures of operating performance of an equity REIT. Moreover, we believe that normalized FFO provides useful information because it allows investors, analysts and our management to compare our operating performance to the operating performance of other real estate companies and between periods on a consistent basis without having to account for differences caused by unanticipated items and other events such as transactions and litigation. We use the National Association of Real Estate Investment Trusts ("NAREIT") definition of FFO. NAREIT defines FFO as net income (computed in accordance with GAAP), excluding gains (or losses) from sales of real estate property and impairment write-downs of depreciable real estate, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis. We define normalized FFO as FFO excluding the following income and expense items (which may be recurring in nature): (a) gains and losses on the sales of real property assets; (b) merger-related costs and expenses, including amortization of intangibles and transition and integration expenses, and deal costs and expenses, including expenses and recoveries relating to our lawsuit against HCP and the issuance of preferred stock or bridge loan fees; (c) the impact of any expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees, or additional costs, expenses, discounts, make-whole payments,

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penalties or premiums incurred as a result of early retirement or payment of our debt; (d) the non-cash effect of income tax benefits or expenses; (e) the impact of future unannounced acquisitions or divestitures (including pursuant to tenant options to purchase) and capital transactions; (f) the financial impact of contingent consideration; (g) charitable donations made to the Ventas Charitable Foundation; and (h) gains and losses for non-operational foreign currency hedge agreements and changes in the fair value of financial instruments.

        Our FFO and normalized FFO for the five years ended December 31, 2011 are summarized in the following table. Our FFO for the year ended December 31, 2011 increased over the prior year primarily due to the NHP and ASLG acquisitions, higher NOI from our senior living operations and MOB operations reportable business segments, net litigation proceeds and income tax benefit, partially offset by increased merger-related expenses and deal costs, general, administrative and professional fees and interest expense due to our enterprise growth.

 
  For the Year Ended December 31,  
 
  2011   2010   2009   2008   2007  
 
  (In thousands)
 

Net income attributable to common stockholders

  $ 364,493   $ 246,167   $ 266,495   $ 222,603   $ 273,681  

Adjustments:

                               

Real estate depreciation and amortization

    454,163     202,128     196,608     228,778     224,028  

Real estate depreciation related to noncontrolling interest

    (3,471 )   (6,217 )   (6,349 )   (8,484 )   (5,982 )

Real estate depreciation related to unconsolidated entities

    6,552     2,367              

Discontinued operations:

                               

Gain on sale of real estate assets

        (25,241 )   (67,305 )   (39,026 )   (129,478 )

Depreciation on real estate assets

    3,114     2,302     3,960     8,486     11,969  
                       

FFO

    824,851     421,506     393,409     412,357     374,218  

Adjustments:

                               

Litigation proceeds, net

    (202,259 )                

Change in fair value of financial instruments

    2,959                  

Reversal of contingent liability

                (23,328 )    

Provision for loan losses

                5,994      

Income tax (benefit) expense

    (31,137 )   2,930     (3,459 )   (17,616 )   (29,095 )

Loss (gain) on extinguishment of debt

    27,604     9,791     6,080     (2,398 )   (88 )

Merger-related expenses and deal costs

    153,923     19,243     13,015     4,460     2,979  

Amortization of other intangibles

    1,022     511              

Net gain on sale of marketable equity securities

                    (864 )

Gain on foreign currency hedge

                    (24,314 )

Preferred stock issuance costs

                    1,750  

Bridge loan fee

                    2,550  
                       

Normalized FFO

  $ 776,963   $ 453,981   $ 409,045   $ 379,469   $ 327,136  
                       

Adjusted EBITDA

        We consider Adjusted EBITDA an important supplemental measure to net income because it provides additional information with which to evaluate the performance of our operations and serves as

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another indication of our ability to service debt. We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization (including non-cash stock-based compensation expense), excluding loss on extinguishment of debt, net litigation proceeds, merger-related expenses and deal costs, gains or losses on sales of real property assets and changes in the fair value of financial instruments (including amounts in discontinued operations). The following is a reconciliation of Adjusted EBITDA to net income (including amounts in discontinued operations) for the years ended December 31, 2011, 2010 and 2009:

 
  For the Year Ended December 31,  
 
  2011   2010   2009  
 
  (In thousands)
 

Net income

  $ 363,261   $ 249,729   $ 269,360  

Adjustments:

                   

Interest

    242,057     179,918     179,736  

Loss on extinguishment of debt

    27,604     9,791     6,080  

Taxes (including amounts in general, administrative and professional fees)

    (29,136 )   6,280     (519 )

Depreciation and amortization

    459,704     206,064     201,258  

Non-cash stock-based compensation expense

    19,346     14,078     11,882  

Merger-related expenses and deal costs

    153,923     19,243     13,015  

Gain on sale of real estate assets

        (25,241 )   (67,305 )

Litigation proceeds, net

    (202,259 )        

Changes in fair value of financial instruments

    2,959          
               

Adjusted EBITDA

  $ 1,037,459   $ 659,862   $ 613,507  
               

NOI

        We also consider NOI an important supplemental measure to net income because it allows investors, analysts and our management to measure unlevered property-level operating results and to compare our operating results to the operating results of other real estate companies and between periods on a consistent basis. We define NOI as total revenues, less interest and other income, property-level operating expenses and medical office building services costs (including amounts in discontinued operations). The following is a reconciliation of NOI to total revenues (including amounts in discontinued operations) for the years ended December 31, 2011, 2010 and 2009:

 
  For the Year Ended December 31,  
 
  2011   2010   2009  
 
  (In thousands)
 

Total revenues

  $ 1,764,991   $ 1,008,751   $ 923,465  

Less:

                   

Interest and other income

    1,217     484     842  

Property-level operating expenses

    651,561     315,953     302,813  

Medical office building services costs

    27,082     9,518      
               

NOI (excluding amounts in discontinued operations)

    1,085,131     682,796     619,810  

Discontinued operations

    10,047     11,466     16,230  
               

NOI (including amounts in discontinued operations)

  $ 1,095,178   $ 694,262   $ 636,040  
               

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Asset/Liability Management

        Asset/liability management is a key element of our overall risk management program. The objective of asset/liability management is to support the achievement of our business strategy, while maintaining appropriate risk levels. Our asset/liability management process focuses on a variety of risks, including without limitation market risk (primarily interest rate risk and foreign currency exchange risk) and credit risk. Effective management of these risks is an important determinant of the absolute levels and variability of our FFO and net worth. The following discussion addresses our integrated management of assets and liabilities, including the use of derivative financial instruments.

Market Risk

        We are exposed to market risk related to fluctuations in interest rates on borrowings under our unsecured revolving credit facility and $500 million term loan facility, floating rate mortgage debt and certain mortgage loans receivable. These market risks result primarily from changes in LIBOR or prime rates. We continuously monitor our level of floating rate debt with respect to total debt and other factors, including our assessment of the current and future economic environment.

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        The table below sets forth certain information with respect to our debt, excluding premiums, discounts and capital lease obligations.

 
  As of December 31,  
 
  2011   2010   2009  
 
  (Dollars in thousands)
 

Balance:

                   

Fixed rate:

                   

Senior notes and other

  $ 2,460,026   $ 1,537,433   $ 1,153,131  

Mortgage loans and other(1)

    2,357,268     1,234,263     1,324,094  

Variable rate:

                   

Unsecured revolving credit facilities

    455,578     40,000     8,466  

Unsecured term loan facility

    501,875          

Mortgage loans and other(1)

    405,696     115,258     215,970  
               

Total

  $ 6,180,443   $ 2,926,954   $ 2,701,661  
               

Percent of total debt:

                   

Fixed rate:

                   

Senior notes and other

    39.8 %   52.5 %   42.7 %

Mortgage loans and other(1)

    38.1 %   42.2 %   49.0 %

Variable rate:

                   

Unsecured revolving credit facilities

    7.4 %   1.4 %   0.3 %

Unsecured term loan facility

    8.1 %   0.0 %   0.0 %

Mortgage loans and other(1)

    6.6 %   3.9 %   8.0 %
               

Total

    100.0 %   100.0 %   100.0 %
               

Weighted average interest rate at end of period:

                   

Fixed rate:

                   

Senior notes and other

    5.3 %   5.1 %   6.3 %

Mortgage loans and other(1)

    6.1 %   6.2 %   6.3 %

Variable rate:

                   

Unsecured revolving credit facilities

    1.4 %   3.1 %   3.1 %

Unsecured term loan facility

    1.8 %   N/A     N/A  

Mortgage loans and other(1)

    2.0 %   1.5 %   2.0 %

Total

    4.8 %   5.4 %   6.0 %

(1)
The amounts presented above exclude debt related to real estate assets classified as held for sale as of December 31, 2011. The total mortgage debt for these properties as of December 31, 2011 was $14.6 million.

        The variable rate debt in the table above reflects, in part, the effect of $167.6 million notional amount of interest rate swaps with a maturity of February 1, 2013 that effectively convert fixed rate debt to variable rate debt. The increase in our outstanding variable rate debt from December 31, 2010 is primarily attributable to debt assumed in connection with the ASLG and NHP acquisitions, borrowings under our variable rate term loan facility and borrowings under our unsecured revolving credit facility. Pursuant to the terms of certain leases with one of our tenants, if interest rates increase on certain variable rate debt that we have totaling $80.0 million as of December 31, 2011, our tenant is required to pay us additional rent (on a dollar-for-dollar basis) in an amount equal to the increase in interest expense resulting from the increased interest rates. Therefore, the increase in interest expense related to this debt is equally offset by an increase in additional rent due to us from the tenant. Assuming a 100 basis point increase in the weighted average interest rate related to our variable rate debt (excluding debt related to real estate assets classified as held for sale at December 31, 2011), and

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assuming no change in our variable rate debt outstanding as of December 31, 2011, interest expense for 2012 would increase, and our net income would decrease, by approximately $13.5 million, or $0.05 per diluted common share. The fair value of our fixed and variable rate debt is based on current interest rates at which we could obtain similar borrowings.

        For fixed rate debt, interest rate fluctuations generally affect the fair value, but do not impact our earnings or cash flows. Therefore, interest rate risk does not have a significant impact on our fixed rate debt obligations until such obligations mature or we elect to prepay and refinance them. If interest rates have risen at the time our fixed rate debt matures or is refinanced, our future earnings and cash flows could be adversely affected by additional borrowing costs. Conversely, lower interest rates at the time of maturity or refinancing may lower our overall borrowing costs.

        To highlight the sensitivity of our fixed rate debt to changes in interest rates, the following summary shows the effects of a hypothetical instantaneous change of 100 basis points ("BPS") in interest rates as of December 31, 2011 and 2010:

 
  As of December 31,  
 
  2011   2010  
 
  (In thousands)
 

Gross book value

  $ 4,984,743   $ 2,771,695  

Fair value(1)

    5,439,222     2,900,143  

Fair value reflecting change in interest rates:(1)

             

-100 BPS

    5,401,585     3,008,630  

+100 BPS

    4,963,413     2,794,140  

(1)
The change in fair value of our fixed rate debt was due primarily to the overall change in interest rates and the assumption of debt in connection with the ASLG and NHP acquisitions.

        We earn interest from investments in marketable debt securities on a fixed rate basis. We record these investments as available-for-sale at fair value, with unrealized gains and losses recorded as a component of other comprehensive income. Interest rate fluctuations and market conditions will cause the fair value of these investments to change. As of December 31, 2011 and 2010, the aggregate fair value of our marketable debt securities held at December 31, 2011, which had an aggregate original cost of $37.8 million, was $43.3 million and $43.4 million, respectively. During 2011, we sold marketable debt securities and received proceeds of approximately $23.1 million.

        As of December 31, 2011, the fair value of our secured and unsecured loans receivable, based on our estimates of currently prevailing interest rates for comparable loans, was $281.5 million. See "Note 6—Loans Receivable" and "Note 11—Fair Values of Financial Instruments" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

        We are subject to fluctuations in U.S. and Canadian exchange rates that may, from time to time, affect our financial condition and results of operations. Increases or decreases in the value of the Canadian dollar impact the amount of net income we earn from our twelve seniors housing communities in Canada. Based solely on our 2011 results, if the Canadian dollar exchange rate were to increase or decrease by $0.10, our net income from these communities would decrease or increase, as applicable, by $0.1 million per year. If we increase our international presence through investments in, or acquisitions or development of, seniors housing or healthcare assets outside the United States, we may also decide to transact additional business or borrow funds under our unsecured revolving credit facility in currencies other than U.S. or Canadian dollars. Although we may decide to pursue hedging alternatives (including additional borrowings in local currencies) to protect against foreign currency fluctuations, we cannot provide any assurance that any such fluctuations will not have a material adverse effect on our business, financial condition, results of operations and liquidity, on our ability to

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service our indebtedness and on our ability to make distributions to our stockholders, as required for us to continue to qualify as a REIT (a "Material Adverse Effect").

        We may engage in hedging strategies to manage our exposure to market risks in the future, depending on an analysis of the interest rate and foreign currency exchange rate environments and the costs and risks of such strategies. However, we do not use derivative financial instruments for speculative purposes.

Concentration and Credit Risk

        We use concentration ratios to understand and evaluate the potential risks of economic downturns or other adverse events affecting our various asset types, geographic locations, business models, or tenants, operators and managers. We evaluate our concentration risk in terms of investment mix, which measures the portion of our investments that consists of a certain asset type or that is operated or managed by a particular tenant, operator or manager, and operations mix, which measures the portion of our operating results that is attributed to a certain tenant or operator, geographic location or business model. The following tables reflect our concentration risk as of the dates and for the periods presented:

 
  As of
December 31,
 
 
  2011   2010  

Investment mix by asset type(1):

             

Seniors housing communities

    66.7 %   70.2 %

Skilled nursing facilities

    16.4 %   11.7 %

MOBs

    13.1 %   10.8 %

Hospitals

    2.6 %   5.0 %

Loans receivable, net

    1.1 %   2.2 %

Other properties

    0.1 %   0.1 %

Investment mix by tenant, operator and manager(1):

             

Atria

    19.0 %   N/A  

Sunrise

    14.4 %   37.9 %

Brookdale Senior Living

    13.0 %   19.7 %

Kindred

    5.0 %   13.1 %

All other

    48.6 %   29.3 %

(1)
Ratios are based on the gross book value of real estate investments as of each reporting date (including assets held for sale as of December 31, 2011).

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  For the Year Ended
December 31,
 
 
  2011   2010   2009  

Operations mix by tenant and operator and business model:

                   

Revenues(1):

                   

Senior living operations(2)

    49.2 %   43.7 %   44.7 %

Kindred

    14.3 %   24.2 %   26.2 %

Brookdale Senior Living

    8.2 %   11.9 %   12.9 %

All others

    28.3 %   20.2 %   16.2 %

Adjusted EBITDA:

                   

Senior living operations(2)

    26.0 %   22.7 %   20.4 %

Kindred

    21.9 %   34.6 %   39.2 %

Brookdale Senior Living

    13.2 %   17.0 %   18.6 %

All others

    38.9 %   25.7 %   21.8 %

NOI:

                   

Senior living operations(2)

    24.3 %   22.2 %   20.6 %

Kindred

    23.2 %   35.6 %   38.5 %

Brookdale Senior Living

    13.4 %   17.3 %   19.1 %

All others

    39.1 %   24.9 %   21.8 %

Operations mix by geographic location(3):

                   

California

    13.7 %   12.0 %   12.7 %

New York

    8.7 %   3.5 %   3.7 %

Illinois

    6.4 %   10.2 %   10.3 %

Massachusetts

    5.0 %   5.0 %   5.3 %

Texas

    5.0 %   2.7 %   2.6 %

All others

    61.2 %   66.6 %   65.4 %

(1)
Total revenues include medical office building and other services revenue, revenue from loans and investments and interest and other income. Revenues from properties sold or held for sale as of the reporting date are included in this presentation.

(2)
Amounts attributable to senior living operations managed by Atria for the year ended December 31, 2011 relate to the period from May 12, 2011, the date of the ASLG acquisition, through December 31, 2011.

(3)
Ratios are based on total revenues for each period presented. Total revenues includes medical office building and other services revenue, revenue from loans and investments and interest and other income. Revenues from properties sold as of the reporting date are excluded from this presentation.

        We derive a significant portion of our revenue by leasing our assets under long-term triple-net leases in which the rental rate is generally fixed with annual escalators, subject to certain limitations. Some of our triple-net lease escalators are tied to the Consumer Price Index ("CPI"), with caps, floors or collars. We also earn revenue from individual residents at our seniors housing communities managed by independent third parties, such as Atria and Sunrise, and tenants in our MOBs. For the year ended December 31, 2011, 29.4% of our Adjusted EBITDA (including amounts in discontinued operations)

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was derived from our senior living operations and MOB operations, where rental rates may fluctuate upon lease rollovers and renewals due to economic or market conditions.

        Our reliance on Kindred and Brookdale Senior Living for a significant portion of our revenues and operating income creates credit risk. Our financial condition and results of operations could be weakened and our ability to service our indebtedness and to make distributions to our stockholders could be limited if either Kindred or Brookdale Senior Living was unable or unwilling to satisfy its obligations to us. In addition, any failure by Kindred or Brookdale Senior Living to effectively conduct its operations or to maintain and improve our properties could adversely affect its business reputation or its ability to attract and retain patients and residents in our properties, which could have a Material Adverse Effect on us. See "Risk Factors—Risks Arising from Our Business—We depend on Kindred and Brookdale Senior Living for a significant portion of our revenues and operating income; Any inability or unwillingness by Kindred or Brookdale Senior Living to satisfy its obligations under its agreements with us could have a Material Adverse Effect on us" included in Part I, Item 1A of this Annual Report on Form 10-K and "Note 3Concentration of Credit Risk" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

        We regularly monitor the credit risk under our lease and other agreements with our tenants and borrowers by, among other things, (i) reviewing and analyzing information regarding the healthcare industry generally, publicly available information regarding tenants, and required information provided by the tenants and borrowers under our lease and other agreements, and (ii) having periodic discussions and visits with tenants, borrowers and their representatives.

        Because Atria and Sunrise manage, but do not lease, our properties, we are not directly exposed to their credit risk in the same manner or to the same extent as our triple-net tenants. However, we rely on their personnel, good faith, expertise, historical performance, technical resources and information systems, proprietary information and judgment to manage our seniors housing communities efficiently and effectively. We also rely on Atria and Sunrise to set resident fees and otherwise operate those properties in compliance with the terms of our management agreements. Although we have various rights as the property owner under our management agreements, Atria's or Sunrise's inability or unwillingness to satisfy its obligations under those agreements, to efficiently and effectively manage our properties and to provide timely and accurate accounting information with respect thereto could have a Material Adverse Effect on us. In addition, significant changes in Atria's or Sunrise's senior management or any adverse developments in their businesses and affairs or financial condition could have a Material Adverse Effect on us. See "Risk Factors—Risks Arising from Our Business—The properties managed by Atria and Sunrise account for a significant portion of our revenues and operating income; Although Atria and Sunrise are managers, not tenants, of our properties, adverse developments in their businesses and affairs or financial condition could have a Material Adverse Effect on us" included in Part I, Item 1A of this Annual Report on Form 10-K.

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Triple-Net Lease Expirations

        We are exposed to the risk that, as our triple-net leases expire, our tenants may elect not to renew those leases and, in that event, we may be unable to reposition the applicable properties on a timely basis or on the same or better economic terms, if at all. The following table summarizes our triple-net lease expirations currently scheduled to occur over the next ten years (excluding leases related to assets held for sale as of December 31, 2011):

 
  Number of
Properties
  2011 Annual
Rental Income
  % of 2011 Total
Triple-Net Rental
Income
 
 
  (Dollars in thousands)
 

2012

    10   $ 1,738     0.3 %

2013

    86     103,682     15.9  

2014

    21     13,840     2.1  

2015

    173     168,231     25.8  

2016

    28     11,233     1.7  

2017

    49     11,920     1.8  

2018(1)

    23     25,842     4.0  

2019

    75     114,290     17.5  

2020

    113     56,586     8.7  

2021

    160     91,558     14.0  

(1)
Includes sixteen assets whose current lease term expires in 2013, but for which Kindred has provided renewal notices. In certain cases, Kindred may have the right to revoke its renewal of eight of those assets currently representing approximately $9 million of annual base rent. See "Note 3—Concentration of Credit Risk" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

        The non-renewal of some or all of our triple-net leases could have a Material Adverse Effect on us. See "Risk Factors—Risks Arising from Our Business—If we must replace any of our tenants or operators, we might be unable to reposition the properties on as favorable terms, or at all, and we could be subject to delays, limitations and expenses, which could have a Material Adverse Effect on us" included in Part I, Item IA of this Annual Report on Form 10-K.

Liquidity and Capital Resources

        As of December 31, 2011, we had a total of $45.8 million of unrestricted cash and cash equivalents, operating cash and cash related to our senior living operations and MOB operations reportable business segments that is deposited and held in property-level accounts. Funds maintained in the property-level accounts are used primarily for the payment of property-level expenses, debt service payments and certain capital expenditures. As of December 31, 2011, we also had escrow deposits and restricted cash of $76.6 million and $1.5 billion of unused borrowing capacity available under our unsecured revolving credit facility.

        During 2011, our principal sources of liquidity were proceeds from the issuance of debt and equity securities, cash flows from operations, borrowings under our unsecured revolving credit facilities and unsecured term loans, proceeds from our loans receivable and marketable securities portfolios, proceeds related to our litigation with HCP and cash on hand. We funded the ASLG acquisition, including deal costs, through the issuance of 24.96 million shares of our common stock, cash on hand, borrowings under our unsecured revolving credit facilities and assumed mortgage financing. We funded the NHP acquisition, including deal costs, through the issuance of 99.8 million shares of our common stock, cash on hand, borrowings under our unsecured revolving credit facilities and the assumption of debt.

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        During the next twelve months, our principal liquidity needs are to: (i) fund normal operating expenses; (ii) meet our debt service requirements; (iii) repay maturing mortgage and other debt, including our 9% senior notes due 2012 and 81/4% senior notes due 2012; (iv) fund capital expenditures for our senior living operations and our MOB operations reportable segments; (v) fund acquisitions, including our pending Cogdell transaction, investments and commitments, including development activities; and (vi) make distributions to our stockholders and unitholders, as required for us to continue to qualify as a REIT. We believe that these liquidity needs generally will be satisfied by cash flows from operations, cash on hand, debt assumptions and financings, issuances of debt and equity securities, including the $600.0 million aggregate principal amount of 4.25% senior notes due 2022 that we issued in February 2012, proceeds from sales of assets and borrowings under our unsecured revolving credit facility and unsecured term loan facility. However, if any of these sources of capital is unavailable to us or is not available at an acceptable cost or if we engage in significant acquisition or investment activity, we may seek or require additional funding from debt assumptions and financings (including secured financings), dispositions of assets (in whole or in part through joint venture arrangements with third parties) and/or the issuance of secured or unsecured long-term debt or other securities. See "Risk Factors—Risks Arising from Our Capital Structure—Limitations on our ability to access capital could have an adverse effect on our ability to meet our debt payments, make distributions to our stockholders or make future investments necessary to implement our business strategy" included in Part I, Item 1A of this Annual Report on Form 10-K.

        We expect to fund the Cogdell transaction through borrowings under our unsecured revolving credit facility and assumed mortgage financing. Completion of the transaction is subject to the approval of Cogdell's stockholders, the sale of Cogdell's design-build and development business and certain other customary closing conditions. We expect to complete the transaction in the second quarter of 2012, although we cannot provide any assurance as to whether or when the closing will occur.

Unsecured Revolving Credit Facility and Term Loans

        As of December 31, 2011, the aggregate borrowing capacity under our unsecured revolving credit facility was $2.0 billion. Borrowings under our unsecured revolving credit facility bear interest at a fluctuating rate per annum equal to a reference rate (the applicable LIBOR for Eurocurrency rate loans and the higher of (i) the federal funds rate plus 0.50%, (ii) the administrative agent's prime rate and (iii) the applicable LIBOR plus 1.0% for base rate loans) plus a spread based on our senior unsecured long-term debt ratings. At December 31, 2011, the applicable spread was 110 basis points for Eurocurrency rate loans and 10 basis points for base rate loans. We also pay a facility fee ranging from 15 to 45 basis points per annum (based on our senior unsecured long-term debt ratings) on the aggregate revolving commitments under the unsecured revolving credit facility. At December 31, 2011, the facility fee was 17.5 basis points. Our unsecured revolving credit facility matures in October 2015, but may be extended for one year at our option, subject to the satisfaction of certain conditions. Under the terms of the unsecured revolving credit facility, our aggregate borrowing capacity may be increased to up to $2.5 billion at our option, subject to the satisfaction of certain conditions.

        The agreement governing our unsecured revolving credit facility subjects us to various financial and other restrictive covenants. See "Note 10—Borrowing Arrangements" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. We were in compliance with all of these covenants at December 31, 2011.

        As of December 31, 2011, we had $200.0 million of borrowings outstanding under an unsecured term loan that matures in September 2013. The term loan is non-amortizing and bears interest at an all-in fixed rate of 4% per annum. We may prepay the term loan at any time on or after September 27, 2012 without penalty or at any time on or after March 27, 2012 and prior to September 27, 2012 with a make-whole payment.

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        As of December 31, 2011, we also had $500.0 million of borrowings outstanding under an unsecured term loan facility with a weighted average maturity of 4.5 years. Borrowings under the term loan facility bear interest at the applicable LIBOR plus a spread based on our senior unsecured long-term debt ratings (125 basis points at December 31, 2011). The term loan facility is comprised of a three-year tranche and a five-year tranche and contains an accordion feature that permits us to increase our aggregate borrowing capacity thereunder to up to $900.0 million, subject to the satisfaction of certain conditions. Upon entering into the term loan facility, we terminated the commitments under an $800.0 million term loan previously extended to NHP and assumed by us in connection with the NHP acquisition that was scheduled to mature in June 2012. Borrowings under the NHP term loan bore interest at the applicable LIBOR plus 150 basis points or the "Alternate Base Rate" plus 0.50%, and the NHP term loan had a 10 basis point per annum facility fee.

Convertible Senior Notes

        In November 2011, we repaid in full $230.0 million principal amount outstanding of our 37/8% convertible senior notes due 2011 upon maturity. In accordance with the terms of the indenture governing the convertible notes, we paid the principal amount of the notes and accrued but unpaid interest thereon in cash and issued an aggregate of 943,714 shares of our common stock in settlement of the conversion value in excess of the principal amount.

Senior Notes and Other

        As of December 31, 2011, the following series of senior notes issued by our subsidiaries, Ventas Realty, Limited Partnership and Ventas Capital Corporation (collectively, the "Ventas Issuers"), were outstanding:

        In connection with the NHP acquisition, our subsidiary, Nationwide Health Properties, LLC ("NHP LLC"), assumed $991.6 million aggregate principal amount of outstanding unsecured senior notes of NHP. In July 2011, we repaid in full, at par, $339.0 million principal amount then outstanding of NHP LLC's 6.50% senior notes due 2011 upon maturity. As of December 31, 2011, the following series of senior notes of NHP LLC were outstanding:

        In February 2012, we issued and sold $600.0 million aggregate principal amount of 4.25% senior notes due 2022, at a public offering price equal to 99.214% of par for total proceeds of $595.3 million, before the underwriting discount and expenses.

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        Also in February 2012, we exercised our option to redeem all $200.0 million principal amount outstanding of the Ventas Issuers' 61/2% senior notes due 2016 pursuant to the terms of the indenture governing the notes. We will pay a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and expect to recognize a loss on extinguishment of debt in the first quarter of 2012.

        In July 2011, we redeemed $200.0 million principal amount outstanding of the Ventas Issuers' 61/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $8.7 million during the third quarter of 2011.

        In May 2011, we issued and sold $700.0 million aggregate principal amount of 4.750% senior notes due 2021, at a public offering price equal to 99.132% of par, for total proceeds of $693.9 million, before the underwriting discount and expenses.

        In November 2010, we issued and sold $400.0 million aggregate principal amount of 3.125% senior notes due 2015, at a public offering price equal to 99.528% of par, for total proceeds of $398.1 million, before the underwriting discount and expenses.

        In October 2010, we redeemed all $71.7 million principal amount outstanding of the Ventas Issuers' 65/8% senior notes due 2014, at a redemption price equal to 102.21% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $73.3 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $2.5 million during the fourth quarter of 2010.

        In September 2010, the subsidiary guarantees on the Ventas Issuers' then outstanding senior notes (other than the 9% senior notes due 2012) were released pursuant to the terms of the indentures governing the notes.

        In June 2010, we redeemed all $142.7 million principal amount outstanding of the Ventas Issuers' 71/8% senior notes due 2015, at a redemption price equal to 103.56% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $147.8 million, plus accrued and unpaid interest, on the redemption date and recognized a net loss on extinguishment of debt of $6.4 million during the second quarter of 2010.

        In May 2010, we repaid in full, at par, $1.4 million principal amount then outstanding of the Ventas Issuers' 63/4% senior notes due 2010 upon maturity.

        We may, from time to time, seek to retire or purchase additional amounts of our outstanding senior notes for cash and/or in exchange for equity securities in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, prospects for future access to capital and other factors. The amounts involved may be material.

        The indentures governing our outstanding senior notes subject us to various financial and other restrictive covenants. However, at any time we maintain investment grade ratings by both Moody's Investors Service and Standard & Poor's Ratings Services, the indentures governing the Ventas Issuers' senior notes due 2012, 2016 and 2017 provide that certain of these restrictive covenants will either be suspended or fall away. See "Note 10—Borrowing Arrangements" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. We were in compliance with all of these covenants at December 31, 2011.

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Mortgage Loan Obligations

        Our share of facility-level mortgage debt outstanding was $2.7 billion and $1.3 billion as of December 31, 2011 and 2010, respectively, and the consolidated aggregate principal amount was $2.8 billion and $1.3 billion as of December 31, 2011 and 2010, respectively.

        During 2011, we assumed mortgage debt of $1.6 billion, including $1.2 billion and $442 million, respectively, in connection with the ASLG and NHP acquisitions. See "Note 4Acquisitions of Real Estate Property" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

        In February 2011, we repaid in full mortgage loans outstanding in the aggregate principal amount of $307.2 million and recognized a loss on extinguishment of debt of $16.5 million in connection with these repayments in the first quarter of 2011.

        During 2010, we assumed $79.5 million of mortgage debt in connection with our acquisition of Lillibridge and its related entities. See "Note 4Acquisitions of Real Estate Property" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

        In June 2010, we repaid $49.8 million of mortgage loans on two of our Sunrise-managed properties in which, at that time, we had 80% ownership interests. In connection with our payment of Sunrise's share ($9.9 million) of those mortgage loans, we acquired Sunrise's 20% noncontrolling interests in the properties.

Dividends

        In order to continue to qualify as a REIT, we must make annual distributions to our stockholders of at least 90% of our REIT taxable income (excluding net capital gain). In 2011, our Board of Directors declared and we paid cash dividends aggregating $2.30 per share, which exceeds 100% of our 2011 estimated taxable income after the use of any net operating loss carryforwards. We also intend to pay dividends greater than 100% of our taxable income, after the use of any net operating loss carryforwards, for 2012. On February 15, 2012, our Board of Directors declared the first quarter 2012 dividend of $0.62 per share, payable in cash on March 29, 2012 to holders of record on March 9, 2012.

        We expect that our REIT taxable income will be less than our cash flows due to the allowance of depreciation and other non-cash deductions in computing REIT taxable income. Although we do not anticipate any inability to satisfy the 90% distribution requirement, from time to time, we may not have sufficient cash on hand or other liquid assets to meet this requirement or we may decide to retain cash or distribute such greater amount as may be necessary to avoid income and excise taxation. If we do not have sufficient cash on hand or other liquid assets to enable us to satisfy the 90% distribution requirement, or if we desire to retain cash, we may borrow funds, issue additional equity securities, pay taxable stock dividends, if possible, distribute other property or securities or engage in a transaction intended to enable us to meet the REIT distribution requirements or any combination of the foregoing. See "Certain U.S. Federal Income Tax Considerations—Requirements for Qualification as a REIT—Annual Distribution Requirements" included in Part I, Item 1 of this Annual Report on Form 10-K.

Capital Expenditures

        The terms of our triple-net leases generally obligate our tenants to maintain and improve our triple-net leased properties. Accordingly, we do not expect to incur any major capital expenditures in connection with these properties. From time to time, however, we may fund the capital expenditures for our triple-net leased properties through loans to the tenants or advances, some of which may increase the amount of rent payable with respect to the properties. After the terms of the triple-net leases expire, or in the event that our tenants are unable or unwilling to meet their obligations under

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those leases, we would expect to fund any capital expenditures for which we may become responsible with cash flows from operations or through additional borrowings.

        With respect to our senior living operations and MOB operations reportable business segments, we expect that capital expenditures will be funded by the cash flows from the properties or through additional borrowings. To the extent that unanticipated expenditures or significant borrowings are required, our liquidity may be affected adversely. Our ability to borrow additional funds may be restricted in certain circumstances by the terms of the instruments governing our outstanding indebtedness.

        As a result of the NHP acquisition, we assumed certain obligations under agreements to develop seniors housing and MOB properties. The construction of these properties is funded through capital provided by us and, in some circumstances, other joint venture members. As of December 31, 2011, one seniors housing community and two MOBs were in various stages of development pursuant to our agreements. We have funded $45.0 million through December 31, 2011 toward these development projects, and our total commitment to these projects is estimated to be between $90 million and $100 million over the development period.

Equity Offerings and Related Events

        In November 2011, we filed a shelf registration statement relating to our Distribution Reinvestment and Stock Purchase Plan ("DRIP"), under which existing stockholders may purchase shares of common stock by reinvesting all or a portion of the cash distribution on their shares of our common stock, subject to certain limits.

        In November 2011, we repaid in full $230.0 million principal amount outstanding of our 37/8% convertible senior notes due 2011 upon maturity. In accordance with the terms of the indenture governing the convertible notes, we paid the principal amount of the notes and accrued but unpaid interest thereon in cash and issued an aggregate of 943,714 shares of our common stock in settlement of the conversion value in excess of the principal amount.

        In July 2011, we filed a shelf registration statement relating to the offer and sale, from time to time, of up to 2,103,086 shares of our common stock that we may issue upon redemption of the Class A limited partnership units in NHP/PMB L.P. See "Note 2—Accounting Policies" of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

        In July 2011, following approval by our stockholders, we amended our Amended and Restated Certificate of Incorporation, as previously amended, to increase the number of authorized shares of our capital stock to 610,000,000, comprised of 600,000,000 shares of common stock, par value $0.25 per share, and 10,000,000 shares of preferred stock, par value $1.00 per share.

        In May 2011, we filed a shelf registration statement relating to the resale by the selling stockholders of the shares of our common stock issued as partial consideration for the ASLG acquisition. In January 2012, the selling stockholders completed an underwritten public offering of 21,070,658 shares of our common stock pursuant to the resale shelf registration statement. We did not receive any proceeds from the offering.

        In February 2011, we completed the sale of 5,563,000 shares of our common stock in an underwritten public offering pursuant to our shelf registration statement for $300.0 million in aggregate proceeds.

        In March 2010, we filed a shelf registration statement relating to the resale, from time to time, by the selling stockholders of shares of our common stock issued upon conversion of our 37/8% convertible senior notes due 2011.

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Other

        We received proceeds of $1.8 million and $11.1 million for the years ended December 31, 2011 and 2010, respectively, from the exercises of outstanding stock options. Future proceeds from the exercises of stock options will be primarily affected by the future trading price of our common stock and the number of options outstanding. Options outstanding (excluding options we assumed in connection with the NHP acquisition) increased to 2.0 million as of December 31, 2011, from 1.7 million as of December 31, 2010. The weighted average exercise price was $42.10 as of December 31, 2011.

        We issued approximately 13,500 and 41,600 shares of common stock under the DRIP for net proceeds of $0.6 million and $2.1 million for the years ended December 31, 2011 and 2010, respectively. We currently offer a 1% discount on the purchase price of our stock to shareholders who reinvest their dividends and/or make optional cash purchases of common stock through the plan. Each month or quarter, as applicable, we may lower or eliminate the discount without prior notice, thereby affecting the future proceeds that we receive from this plan.

Cash Flows

        The following table sets forth our sources and uses of cash flows for the years ended December 31, 2011 and 2010:

 
  For the Year Ended
December 31,
  Increase (Decrease)
to Cash
 
 
  2011   2010   $   %  
 
  (Dollars in thousands)
 

Cash and cash equivalents at beginning of period

  $ 21,812   $ 107,397   $ (85,585 )   (79.7 )%

Net cash provided by operating activities

    773,197     447,622     325,575     72.7  

Net cash used in investing activities

    (997,439 )   (301,920 )   (695,519 )   >100  

Net cash provided by (used in) financing activities

    248,282     (231,452 )   479,734     (>100 )

Effect of foreign currency translation on cash and cash equivalents

    (45 )   165     (210 )   (>100 )
                     

Cash and cash equivalents at end of period

  $ 45,807   $ 21,812   $ 23,995     >100 %
                     

Cash Flows from Operating Activities

        Cash flows from operating activities increased in 2011 primarily due to the NHP and ASLG acquisitions, higher NOI from our senior living operations and MOB operations reportable business segments and proceeds related to our litigation with HCP, partially offset by increased merger-related expenses and deal costs, general, administrative and professional fees and deal costs and interest expense all due to our enterprise growth.

Cash Flows from Investing Activities

        Cash used in investing activities during 2011 and 2010 consisted primarily of cash paid for our investments in real estate ($531.6 million and $274.4 million in 2011 and 2010, respectively), investments in loans receivable ($628.1 million and $38.7 million in 2011 and 2010, respectively), capital expenditures ($50.5 million and $18.2 million in 2011 and 2010, respectively), development project expenditures ($47.6 million and $1.7 million in 2011 and 2010, respectively), and the purchase of noncontrolling interests ($3.3 million and $42.3 million in 2011 and 2010, respectively). The increase in capital expenditures and development project expenditures is the direct result of the growth in our senior living and MOB operations reportable business segments. These uses were partially offset by proceeds from loans receivable ($220.2 million and $19.3 million in 2011 and 2010, respectively),

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proceeds from the sale of marketable debt securities ($23.1 million in 2011), and proceeds from real estate disposals ($20.6 million and $58.2 million in 2011 and 2010, respectively).

Cash Flows from Financing Activities

        Cash provided by financing activities during 2011 consisted primarily of $537.5 million of net borrowings under our unsecured revolving credit facilities, $1.3 billion of net proceeds from the issuance of debt and $299.8 million of net proceeds from the issuance of common stock. These cash inflows were partially offset by $1.4 billion of debt repayments, $526.0 million of cash dividend and distribution payments to common stockholders, unitholders and noncontrolling interest parties and $20.0 million of payments for deferred financing costs.

        Cash used in financing activities during 2010 consisted primarily of $524.8 million of debt repayments, $344.2 million of cash dividend and distribution payments to common stockholders and noncontrolling interest parties and $2.7 million of payments for deferred financing costs. These uses were partially offset by $597.4 million of proceeds from the issuance of debt and $28.6 million of net borrowings under our unsecured revolving credit facilities.

Contractual Obligations

        The following table summarizes the effect that minimum debt (which includes principal and interest payments) and other material noncancelable commitments are expected to have on our cash flow in future periods as of December 31, 2011:

 
  Total   Less than 1
year(5)
  1 - 3 years(6)   3 - 5 years(7)   More than 5
years(8)
 
 
  (In thousands)
 

Long-term debt obligations(1)(2)(3)

  $ 7,961,489   $ 613,231   $ 1,742,243   $ 2,397,133   $ 3,208,882  

Capital lease obligations

    211,097     9,446     19,272     19,779     162,600  

Acquisition commitments(4)

    495,000     495,000              

Operating obligations, including ground lease obligations

    400,421     17,620     32,346     27,960     322,495  
                       

Total

  $ 9,068,007   $ 1,135,297   $ 1,793,861   $ 2,444,872   $ 3,693,977  
                       

(1)
Amounts represent contractual amounts due, including interest.

(2)
Interest on variable rate debt was based on forward rates obtained as of December 31, 2011.

(3)
The amounts presented above exclude debt related to real estate assets classified as held for sale as of December 31, 2011. The total mortgage debt for these properties as of December 31, 2011 was $14.6 million and is scheduled to mature as follows: $5.7 million in 2012 and $8.9 million in 2032.

(4)
Represents our acquisition commitments related to the pending Cogdell transaction, two seniors housing communities and one MOB.

(5)
Includes $82.4 million outstanding principal amount of the Ventas Issuers' 9% senior notes due 2012, and $73.0 million outstanding principal amount of NHP LLC's 81/4% senior notes due 2012.

(6)
Includes $200.0 million of borrowings under our unsecured term loan due 2013, $269.9 million outstanding principal amount of NHP LLC's 6.25% senior notes due 2013, $126.9 million of borrowings under our unsecured term loan due 2015, $400.0 million outstanding principal amount of the Ventas Issuers' 3.125% senior notes due 2015, and $234.4 million outstanding principal amount of NHP LLC's 6% senior notes due 2015.

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(7)
Includes $200.0 million outstanding principal amount of the Ventas Issuers' 61/2% senior notes due 2016, $375.0 million of borrowings under our unsecured term loan due 2017, and $225.0 million outstanding principal amount of the Ventas Issuers' 63/4% senior notes due 2017.

(8)
Includes $700.0 million outstanding principal amount of the Ventas Issuers' 4.750% senior notes due 2021, $52.4 million outstanding principal amount of NHP LLC's 6.90% senior notes due 2037, and $23.0 million outstanding principal amount of NHP LLC's 6.59% senior notes due 2038.

        As of December 31, 2011, we had $14.9 million of unrecognized tax benefits that are excluded from the table above, as we are unable to make a reasonable reliable estimate of the period of cash settlement, if any, with the respective tax authority.

ITEM 7A.    Quantitative and Qualitative Disclosures About Market Risk

        The information set forth in Item 7 of this Annual Report on Form 10-K under "Management's Discussion and Analysis of Financial Condition and Results of Operations—Asset/Liability Management" is incorporated by reference into this Item 7A.

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ITEM 8.    Financial Statements and Supplementary Data

Ventas, Inc.
Index to Consolidated Financial Statements and Financial Statement Schedules

Management Report on Internal Control over Financial Reporting

    93  

Report of Independent Registered Public Accounting Firm

    94  

Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting

    95  

Consolidated Balance Sheets as of December 31, 2011 and 2010

    96  

Consolidated Statements of Income for the Years Ended December 31, 2011, 2010 and 2009

    97  

Consolidated Statements of Equity for the Years Ended December 31, 2011, 2010 and 2009

    98  

Consolidated Statements of Cash Flows for the Years Ended December 31, 2011, 2010 and 2009

    99  

Notes to Consolidated Financial Statements

    100  

Consolidated Financial Statement Schedule

       

Schedule III—Real Estate and Accumulated Depreciation

    166  

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MANAGEMENT REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

        Management of Ventas, Inc. (the "Company") is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended. Management, with the participation of the Company's Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company's internal control over financial reporting based on the framework established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this evaluation, management has determined that the Company's internal control over financial reporting as of December 31, 2011 was effective.

        On May 12, 2011, the Company acquired substantially all of the real estate assets and working capital of privately-owned Atria Senior Living Group, Inc. (together with its affiliates, "ASLG"). On July 1, 2011, the Company acquired Nationwide Health Properties, Inc. (together with its subsidiaries, "NHP") in a stock-for-stock transaction. As permitted under Securities and Exchange Commission guidelines, the Company excluded from the assessment of the effectiveness of its internal control over financial reporting as of December 31, 2011, internal control over financial reporting of the ASLG and NHP assets and operations. Total assets and total revenues related to ASLG and NHP represented 67.4% and 38.1%, respectively, of the Company's related consolidated financial statement amounts as of and for the year ended December 31, 2011.

        The effectiveness of the Company's internal control over financial reporting as of December 31, 2011 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report included herein.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Stockholders and Board of Directors
Ventas, Inc.

        We have audited the accompanying consolidated balance sheets of Ventas, Inc. as of December 31, 2011 and 2010, and the related consolidated statements of income, equity, and cash flows for each of the three years in the period ended December 31, 2011. Our audits also included the financial statement schedule listed in the accompanying index to the financial statements and financial statement schedule. These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

        We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

        In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Ventas, Inc. at December 31, 2011 and 2010, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2011, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

        We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Ventas Inc.'s internal control over financial reporting as of December 31, 2011, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 22, 2012 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP
Chicago, Illinois
February 22, 2012

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Stockholders and Board of Directors
Ventas, Inc.

        We have audited Ventas, Inc.'s internal control over financial reporting as of December 31, 2011, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Ventas, Inc.'s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the company's internal control over financial reporting based on our audit.

        We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

        A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.

        Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

        As indicated in the accompanying Management Report on Internal Control over Financial Reporting, management's assessment of and conclusion on the effectiveness of internal control over financial reporting did not include internal controls of Atria Senior Living Group, Inc. ("ASLG") and Nationwide Health Properties, Inc. ("NHP"), which are included in the 2011 consolidated financial statements of Ventas, Inc. and constituted 67.4% and 38.1% of total assets and total revenues, respectively, as of and for the year ended December 31, 2011. Our audit of internal control over financial reporting of Ventas, Inc. also did not include an evaluation of the internal control over financial reporting of ASLG or NHP.

        In our opinion, Ventas, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2011, based on the COSO criteria.

        We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the 2011 consolidated financial statements and financial statement schedule of Ventas, Inc. and our report dated February 22, 2012 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP
Chicago, Illinois
February 22, 2012

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VENTAS, INC.

CONSOLIDATED BALANCE SHEETS

As of December 31, 2011 and 2010

(In thousands, except per share amounts)

 
  2011   2010  
 
  (In thousands, except per
share amounts)

 

Assets

             

Real estate investments:

             

Land and improvements

  $ 1,614,847   $ 559,072  

Buildings and improvements

    15,337,919     6,035,295  

Construction in progress

    76,638     6,519  

Acquired lease intangibles

    800,858     146,813  
           

    17,830,262     6,747,699  

Accumulated depreciation and amortization

    (1,916,530 )   (1,468,180 )
           

Net real estate property

    15,913,732     5,279,519  

Secured loans receivable, net

    212,577     149,263  

Investments in unconsolidated entities

    105,303     15,332  
           

Net real estate investments

    16,231,612     5,444,114  

Cash and cash equivalents

   
45,807
   
21,812
 

Escrow deposits and restricted cash

    76,590     38,940  

Deferred financing costs, net

    26,669     19,533  

Other assets

    891,232     233,622  
           

Total assets

  $ 17,271,910   $ 5,758,021  
           

Liabilities and equity

             

Liabilities:

             

Senior notes payable and other debt

  $ 6,429,116   $ 2,900,044  

Accrued interest

    37,694     19,296  

Accounts payable and other liabilities

    1,085,597     207,143  

Deferred income taxes

    260,722     241,333  
           

Total liabilities

    7,813,129     3,367,816  

Redeemable OP unitholder interests

   
102,837
   
 

Commitments and contingencies

             

Equity:

             

Ventas stockholders' equity:

             

Preferred stock, $1.00 par value; 10,000 shares authorized, unissued

         

Common stock, $0.25 par value; 600,000 and 300,000 shares authorized at December 31, 2011 and 2010, respectively; 288,823 and 157,279 shares issued at December 31, 2011 and 2010, respectively

    72,240     39,391  

Capital in excess of par value

    9,593,583     2,576,843  

Accumulated other comprehensive income

    22,062     26,868  

Retained earnings (deficit)

    (412,181 )   (255,628 )

Treasury stock, 14 shares at December 31, 2011 and 2010

    (747 )   (748 )
           

Total Ventas stockholders' equity

    9,274,957     2,386,726  

Noncontrolling interest

    80,987     3,479  
           

Total equity

    9,355,944     2,390,205  
           

Total liabilities and equity

  $ 17,271,910   $ 5,758,021  
           

   

See accompanying notes.

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VENTAS, INC.

CONSOLIDATED STATEMENTS OF INCOME

For the Years Ended December 31, 2011, 2010 and 2009

 
  2011   2010   2009  
 
  (In thousands, except per share
amounts)

 

Revenues:

                   

Rental income:

                   

Triple-net leased

  $ 652,577   $ 461,709   $ 452,536  

Medical office buildings

    167,003     69,747     35,922  
               

    819,580     531,456     488,458  

Resident fees and services

    873,308     446,301     421,058  

Medical office building and other services revenue

    36,471     14,098      

Income from loans and investments

    34,415     16,412     13,107  

Interest and other income

    1,217     484     842  
               

Total revenues

    1,764,991     1,008,751     923,465  

Expenses:

                   

Interest

    236,807     175,631     173,810  

Depreciation and amortization

    456,590     203,762     197,298  

Property-level operating expenses:

                   

Senior living

    593,977     291,831     290,045  

Medical office buildings

    57,584     24,122     12,768  
               

    651,561     315,953     302,813  

Medical office building services costs

    27,082     9,518      

General, administrative and professional fees

    74,537     49,830     38,830  

Loss on extinguishment of debt

    27,604     9,791     6,080  

Litigation proceeds, net

    (202,259 )        

Merger-related expenses and deal costs

    153,923     19,243     13,015  

Other

    8,653     272     50  
               

Total expenses

    1,434,498     784,000     731,896  
               

Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest

    330,493     224,751     191,569  

Loss from unconsolidated entities

    (52 )   (664 )    

Income tax benefit (expense)

    31,137     (5,201 )   1,719  
               

Income from continuing operations

    361,578     218,886     193,288  

Discontinued operations

    1,683     30,843     76,072  
               

Net income

    363,261     249,729     269,360  

Net (loss) income attributable to noncontrolling interest (net of tax of $0, $2,271 and $1,740 for the years ended December 31, 2011, 2010 and 2009, respectively)

    (1,232 )   3,562     2,865  
               

Net income attributable to common stockholders

  $ 364,493   $ 246,167   $ 266,495  
               

Earnings per common share:

                   

Basic:

                   

Income from continuing operations attributable to common stockholders

  $ 1.59   $ 1.37   $ 1.25  

Discontinued operations

    0.01     0.20     0.50  
               

Net income attributable to common stockholders

  $ 1.60   $ 1.57   $ 1.75  
               

Diluted:

                   

Income from continuing operations attributable to common stockholders

  $ 1.57   $ 1.36   $ 1.24  

Discontinued operations

    0.01     0.20     0.50  
               

Net income attributable to common stockholders

  $ 1.58   $ 1.56   $ 1.74  
               

Weighted average shares used in computing earnings per common share:

                   

Basic

    228,453     156,608     152,566  

Diluted

    230,790     157,657     152,758  

   

See accompanying notes.

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VENTAS, INC.

CONSOLIDATED STATEMENTS OF EQUITY

For the Years Ended December 31, 2011, 2010 and 2009

 
  Common
Stock Par
Value
  Capital in
Excess of
Par Value
  Accumulated
Other
Comprehensive
Income
  Retained
Earnings
(Deficit)
  Treasury
Stock
  Total Ventas
Stockholders'
Equity
  Noncontrolling
Interest
  Total Equity  
 
  (In thousands, except per share amounts)
 

Balance at January 1, 2009

  $ 35,825   $ 2,264,125   $ (21,089 ) $ (117,806 ) $ (457 ) $ 2,160,598   $ 19,137   $ 2,179,735  

Comprehensive Income:

                                                 

Net income

                266,495         266,495     2,865     269,360  

Foreign currency translation

            23,552             23,552         23,552  

Change in unrealized gain on marketable debt securities

            17,327             17,327         17,327  

Other

            (121 )           (121 )       (121 )
                                             

Comprehensive income

                        307,253     2,865     310,118  

Net change in noncontrolling interest

        334                 334     (3,453 )   (3,119 )

Dividends to common stockholders—$2.05 per share

                (314,399 )       (314,399 )       (314,399 )

Issuance of common stock

    3,266     295,935                 299,201         299,201  

Issuance of common stock for stock plans

    30     12,819             175     13,024         13,024  

Grant of restricted stock, net of forfeitures

    39     (174 )           (365 )   (500 )       (500 )
                                   

Balance at December 31, 2009

    39,160     2,573,039     19,669     (165,710 )   (647 )   2,465,511     18,549     2,484,060  

Comprehensive Income:

                                                 

Net income

                246,167         246,167     3,562     249,729  

Foreign currency translation

            6,951             6,951         6,951  

Change in unrealized gain on marketable debt securities

            354             354         354  

Other

            (106 )           (106 )       (106 )
                                             

Comprehensive income

                        253,366     3,562     256,928  

Net change in noncontrolling interest

   
   
(18,503

)
 
   
   
   
(18,503

)
 
(18,632

)
 
(37,135

)

Dividends to common stockholders—$2.14 per share

                (336,085 )       (336,085 )       (336,085 )

Issuance of common stock for stock plans

    197     21,076             3,371     24,644         24,644  

Grant of restricted stock, net of forfeitures

    34     1,231             (3,472 )   (2,207 )       (2,207 )
                                   

Balance at December 31, 2010

    39,391     2,576,843     26,868     (255,628 )   (748 )   2,386,726     3,479     2,390,205  

Comprehensive Income:

                                                 

Net income (loss)

                364,493         364,493     (1,232 )   363,261  

Foreign currency translation

            (1,944 )           (1,944 )       (1,944 )

Change in unrealized gain on marketable debt securities

            (2,691 )           (2,691 )       (2,691 )

Other

            (171 )           (171 )       (171 )
                                             

Comprehensive income

                        359,687     (1,232 )   358,455  

Acquisition-related activity

   
31,181
   
6,711,081
   
   
   
(4,326

)
 
6,737,936
   
81,192
   
6,819,128
 

Net change in noncontrolling interest

        (3,188 )               (3,188 )   (2,452 )   (5,640 )

Dividends to common stockholders—$2.30 per share

                (521,046 )       (521,046 )       (521,046 )

Issuance of common stock

    1,627     297,931                 299,558         299,558  

Issuance of common stock for stock plans

    9     18,999             3,293     22,301         22,301  

Adjust redeemable OP unitholder interests to current fair value

        (4,442 )               (4,442 )       (4,442 )

Purchase of OP units

        (52 )               (52 )       (52 )

Grant of restricted stock, net of forfeitures

    32     (3,589 )           1,034     (2,523 )       (2,523 )
                                   

Balance at December 31, 2011

  $ 72,240   $ 9,593,583   $ 22,062   $ (412,181 ) $ (747 ) $ 9,274,957   $ 80,987   $ 9,355,944  
                                   

   

See accompanying notes.

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VENTAS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Years Ended December 31, 2011, 2010 and 2009

 
  2011   2010   2009  
 
  (In thousands)
 

Cash flows from operating activities:

                   

Net income

  $ 363,261   $ 249,729   $ 269,360  

Adjustments to reconcile net income to net cash provided by operating activities:

                   

Depreciation and amortization (including amounts in discontinued operations)

    459,704     206,064     201,258  

Amortization of deferred revenue and lease intangibles, net

    (12,159 )   (1,764 )   (1,772 )

Other non-cash amortization

    (13,163 )   8,750     6,353  

Change in fair value of financial instruments

    2,959          

Stock-based compensation

    19,346     14,078     11,882  

Straight-lining of rental income, net

    (14,885 )   (10,167 )   (11,879 )

Loss on extinguishment of debt

    27,604     9,791     6,080  

Net gain on sale of real estate assets (including amounts in discontinued operations)

        (25,241 )   (67,305 )

Gain on real estate loan investments

    (3,255 )   (915 )    

Gain on sale of marketable securities

    (733 )        

Income tax (benefit) expense

    (31,137 )   5,201     (1,719 )

Loss from unconsolidated entities

    52     664      

Other

    4,446     (46 )   (95 )

Changes in operating assets and liabilities:

                   

Decrease (increase) in other assets

    424     (8,245 )   (1,514 )

(Decrease) increase in accrued interest

    (9,150 )   1,311     (3,957 )

(Decrease) increase in accounts payable and other liabilities

    (20,117 )   (1,588 )   15,409  
               

Net cash provided by operating activities

    773,197     447,622     422,101  

Cash flows from investing activities:

                   

Net investment in real estate property

    (531,605 )   (274,441 )   (45,715 )

Purchase of noncontrolling interest

    (3,319 )   (42,333 )    

Investment in loans receivable

    (628,133 )   (38,725 )   (13,803 )

Proceeds from real estate disposals

    20,618     58,163     58,542  

Proceeds from loans receivable

    220,179     19,291     8,028  

Proceeds from sale of marketable securities

    23,050          

Proceeds from sale of investments

            5,000  

Development project expenditures

    (47,591 )   (1,662 )   (2,732 )

Capital expenditures

    (50,473 )   (18,193 )   (11,066 )

Other

    (165 )   (4,020 )    
               

Net cash used in investing activities

    (997,439 )   (301,920 )   (1,746 )

Cash flows from financing activities:

                   

Net change in borrowings under revolving credit facilities

    537,452     28,564     (292,873 )

Proceeds from debt

    1,343,640     597,382     365,682  

Repayment of debt

    (1,388,962 )   (524,760 )   (525,173 )

Payment of deferred financing costs

    (20,040 )   (2,694 )   (16,655 )

Issuance of common stock, net

    299,847         299,201  

Cash distribution to common stockholders

    (521,046 )   (336,085 )   (314,399 )

Cash distribution to redeemable OP unitholders

    (2,359 )        

Purchases of redeemable OP units

    (185 )        

Contributions from noncontrolling interest

    2     818     1,211  

Distributions to noncontrolling interest

    (2,556 )   (8,082 )   (9,869 )

Other

    2,489     13,405     2,695  
               

Net cash provided by (used in) financing activities

    248,282     (231,452 )   (490,180 )
               

Net increase (decrease) in cash and cash equivalents

    24,040     (85,750 )   (69,825 )

Effect of foreign currency translation on cash and cash equivalents

    (45 )   165     410  

Cash and cash equivalents at beginning of period

    21,812     107,397     176,812  
               

Cash and cash equivalents at end of period

  $ 45,807   $ 21,812   $ 107,397  
               

Supplemental disclosure of cash flow information:

                   

Interest paid including swap payments and receipts

  $ 257,175   $ 161,352   $ 175,298  

Supplemental schedule of non-cash activities:

                   

Assets and liabilities assumed from acquisitions:

                   

Real estate investments

  $ 10,973,093   $ 125,846   $ 67,781  

Utilization of escrow funds held for an Internal Revenue Code Section 1031 exchange

            (64,995 )

Other assets acquired

    594,176     (385 )    

Debt assumed

    3,651,089     125,320      

Other liabilities

    952,279     141     62  

Deferred income tax liability

    43,889          

Redeemable OP unitholder interests

    100,888          

Noncontrolling interests

    81,192         2,724  

Equity issued

    6,737,932          

Debt transferred on the sale of assets

            38,759  

   

See accompanying notes.

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Note 1—Description of Business

        Ventas, Inc. (together with its subsidiaries, unless otherwise indicated or except where the context otherwise requires, "we," "us" or "our") is a real estate investment trust ("REIT") with a geographically diverse portfolio of seniors housing and healthcare properties throughout the United States and Canada. As of December 31, 2011, we owned 1,378 properties assets located in 46 states, the District of Columbia and two Canadian provinces, consisting of: 678 seniors housing communities; 396 skilled nursing facilities; 47 hospitals; 249 MOBs; and eight personal care facilities. We also were in the process of developing three properties as of December 31, 2011. We are headquartered in Chicago, Illinois and have been a constituent member of the S&P 500® Index, a leading indicator of the large cap U.S. equities market, since March 2009.

        Our primary business focuses on acquiring and owning seniors housing and healthcare properties and leasing those properties to unaffiliated tenants or operating those properties through independent third party managers. Through our Lillibridge Healthcare Services, Inc. ("Lillibridge") subsidiary and our ownership interest in PMB Real Estate Services LLC ("PMBRES"), which we acquired in July 2011 in connection with our acquisition of Nationwide Health Properties, Inc. (together with its subsidiaries, "NHP"), we also provide MOB management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. In addition, from time to time, we make mortgage loan and other investments relating to seniors housing and healthcare companies or properties.

        As of December 31, 2011, we leased 929 properties (excluding MOBs) to healthcare operating companies under "triple-net" or "absolute-net" leases that obligate the tenants to pay all property-related expenses, including maintenance, utilities, repairs, taxes, insurance and capital expenditures, and we engaged independent third parties, such as Atria Senior Living, Inc. ("Atria") and Sunrise Senior Living, Inc. (together with its subsidiaries, "Sunrise"), to manage 200 seniors housing communities pursuant to long-term management agreements. Kindred Healthcare, Inc. (together with its subsidiaries, "Kindred") and Brookdale Senior Living Inc. (together with its subsidiaries, "Brookdale Senior Living") leased 198 and 167 of our properties (excluding properties included in investments in unconsolidated entities), respectively, as of December 31, 2011.

Note 2—Accounting Policies

Principles of Consolidation

        The accompanying Consolidated Financial Statements include our accounts and the accounts of our wholly owned subsidiaries and the joint venture entities over which we exercise control. All intercompany transactions and balances have been eliminated in consolidation, and net earnings are reduced by the portion of net earnings attributable to noncontrolling interests.

        We apply Financial Accounting Standards Board ("FASB") guidance for arrangements with variable interest entities ("VIEs"), which requires us to identify entities for which control is achieved through means other than voting rights and to determine which business enterprise is the primary beneficiary of the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity's activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity's activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity's activities either involve, or are conducted

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on behalf of, an investor that has disproportionately few voting rights. We consolidate investments in VIEs when we are determined to be the primary beneficiary of the VIE. We may change our original assessment of a VIE due to events such as modifications of contractual arrangements that affect the characteristics or adequacy of the entity's equity investments at risk and the disposal of all or a portion of an interest held by the primary beneficiary.

        We identify the primary beneficiary of a VIE as the enterprise that has both: (i) the power to direct the activities of the VIE that most significantly impact the entity's economic performance; and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could be significant to the entity. We perform this analysis on an ongoing basis. At December 31, 2011, we did not have any unconsolidated VIEs.

        We also apply FASB guidance related to investments in joint ventures based on the type of rights held by the limited partner(s) that may preclude consolidation by the sole general partner in certain circumstances in which the general partner would otherwise consolidate the joint venture. We assess limited partners' rights and their impact on the presumption of control of the limited partnership by the sole general partner when an investor becomes the sole general partner, and we reassess if (i) there is a change to the terms or in the exercisability of the rights of the limited partners, (ii) the sole general partner increases or decreases its ownership of limited partnership interests, or (iii) there is an increase or decrease in the number of outstanding limited partnership interests. We also apply this guidance to managing member interests in limited liability companies.

Investments in Unconsolidated Entities

        We report investments in unconsolidated entities over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. Under this method of accounting, our share of the investee's earnings or losses is included in our Consolidated Statements of Income.

        The initial carrying value of investments in unconsolidated entities is based on the fair value of the assets at the time we acquired the joint venture interest. We estimate fair values for our equity method investments based on discounted cash flow models that include all estimated cash inflows and outflows over a specified holding period and, where applicable, any estimated debt premiums or discounts. The capitalization rates, discount rates and credit spreads we use in these models are based upon assumptions that we believe to be within a reasonable range of current market rates for the respective investments.

        We generally amortize any difference between our cost basis and the basis reflected at the joint venture level over the lives of the related assets and liabilities and include it in our share of income or loss from unconsolidated entities. For earnings of equity method investments with non-pro rata distribution allocations, net income or loss is allocated between the partners in the joint venture based on the hypothetical liquidation at book value method (the "HLBV method"). Under the HLBV method, net income or loss is allocated between the partners based on the difference between each partner's claim on the net assets of the partnership at the end and beginning of the period, after taking into account contributions and distributions. Each partner's share of the net assets of the partnership is calculated as the amount that the partner would receive if the partnership were to liquidate all of its assets at net book value and distribute the resulting cash to creditors and partners in accordance with their respective priorities. Under this method, in any given period, we could be recording more or less

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income than the joint venture has generated, than actual cash distributions received or than the amount we may receive in the event of an actual liquidation.

Accounting Estimates

        The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions regarding future events that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Business Combinations

        We account for acquisitions using the acquisition method and allocate the cost of the properties acquired among tangible and recognized intangible assets and liabilities based upon their estimated fair values as of the acquisition date. Recognized intangibles primarily include the value of in-place leases, acquired lease contracts, tenant and customer relationships, trade names/trademarks and goodwill. We do not amortize goodwill, which represents the excess of the purchase price paid over the fair value of the net assets of the acquired business and is included in other assets on our Consolidated Balance Sheets.

        We estimate the fair value of buildings on an as-if-vacant basis and depreciate the building value over the estimated remaining life of the building, not to exceed 35 years. We determine the allocated value of other fixed assets, such as site improvements and furniture, fixtures and equipment, based upon the replacement cost and depreciate such value over the assets' estimated remaining useful lives as determined at the applicable acquisition date. We determine the value of land by considering the sales prices of similar properties in recent transactions or based on (a) internal analyses of recently acquired and existing comparable properties within our portfolio or (b) real estate tax assessed values in relation to the total value of the asset.

        The fair value of acquired lease intangibles, if any, reflects (i) the estimated value of any above and/or below market leases, determined by discounting the difference between the estimated market rent and the in-place lease rent, the resulting intangible asset or liability of which we amortize to revenue over the remaining life of the associated lease plus any bargain renewal periods, and (ii) the estimated value of in-place leases related to the cost to obtain tenants, including leasing commissions, and an estimated value of the absorption period to reflect the value of the rent and recovery costs foregone during a reasonable lease-up period as if the acquired space was vacant, which we amortize to amortization expense over the remaining life of the associated lease. If a lease were to be terminated prior to its stated expiration or not renewed, all unamortized amounts of lease intangibles would be recognized in operations at that time.

        We estimate the fair value of purchase option intangible assets or liabilities by discounting the difference between the applicable property's acquisition date fair value and an estimate of the future option price. We do not amortize the resulting intangible asset or liability over the term of the lease, but rather adjust the recognized value of the asset or liability upon exercise of the purchase option. Net real estate assets for which we have recorded a tenant purchase option intangible were $644.0 million and $0 at December 31, 2011 and 2010, respectively.

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        We estimate the fair value of tenant or other customer relationships acquired, if any, by considering the nature and extent of existing business relationships with the tenant or customer, growth prospects for developing new business with the tenant or customer, the tenant's credit quality, expectations of lease renewals with the tenant, and the potential for significant, additional future leasing arrangements with the tenant and amortize that value over the expected life of the associated arrangements or leases, including the remaining terms of the related leases and any expected renewal periods. We estimate the fair value of trade names/trademarks using a royalty rate methodology and amortize that value over the estimated useful life of the trade name/trademark.

        In connection with a business combination, we may assume the rights and obligations under certain lease agreements pursuant to which we become the lessee of a given property. We assume the lease classification previously determined by the prior lessee absent a modification in the assumed lease agreement. In connection with our recent acquisitions, all capital leases acquired or assumed contain bargain purchase options that we intend to exercise. Therefore, we recognized an asset based on the acquisition date fair value of the underlying property and a liability based on the acquisition date fair value of the capital lease obligation. We depreciate assets recognized under capital leases that contain bargain purchase options over the asset's useful life. We assess assumed operating leases, including ground leases, to determine whether the lease terms are favorable or unfavorable given current market conditions on the acquisition date. To the extent the lease terms are favorable or unfavorable relative to market conditions on the acquisition date, we recognize an intangible asset or liability, respectively, at fair value, and we amortize the recognized asset or liability (excluding purchase option intangibles) to interest or rental expense in our Consolidated Statements of Income over the applicable lease term. We include all lease-related intangible assets and all lease-related intangible liabilities within acquired lease intangibles and accounts payable and other liabilities, respectively, on our Consolidated Balance Sheets.

        We determine fair value of loans receivable acquired in connection with a business combination by discounting the estimated future cash flows using current interest rates at which similar loans with the same maturities and same terms would be made to borrowers with similar credit ratings. The estimated future cash flows reflect our judgment regarding the uncertainty of those cash flows, so we do not establish a valuation allowance at the acquisition date. We recognize the difference between the acquisition date fair value and the total expected cash flows as interest income using an effective interest method over the life of the applicable loan. Subsequent to the acquisition date, we evaluate changes regarding the uncertainty of future cash flows and the need for a valuation allowance.

        We estimate the fair value of noncontrolling interests assumed using assumptions that are consistent with those used in valuing all of the underlying assets and liabilities.

        We calculate the fair value of long-term debt by discounting the remaining contractual cash flows on each instrument at the current market rate for those borrowings, which we approximate based on the rate we would expect to incur to replace the instrument on the date of acquisition, and recognize any fair value adjustments related to long-term debt as effective yield adjustments over the remaining term of the instrument.

        We record a liability for contingent consideration (included in accounts payable and other liabilities on our Consolidated Balance Sheets) at fair value as of the acquisition date and reassess the fair value at the end of each reporting period, with any changes being recognized in earnings. Increases or decreases in the fair value of contingent consideration can result from changes in discount periods, discount rates and probabilities that contingencies will be met.

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Impairment of Long-Lived and Intangible Assets

        We periodically evaluate our long-lived assets, primarily consisting of our investments in real estate, for impairment indicators. If indicators of impairment are present, we evaluate the carrying value of the related real estate investments in relation to the future undiscounted cash flows of the underlying operation. In performing this evaluation we consider market conditions as well as our intent with respect to holding or disposing of the asset. We adjust the net book value of leased properties and other long-lived assets to fair value if the sum of the expected future undiscounted cash flows, including sales proceeds, is less than book value. We recognize an impairment loss at the time we make any such determination.

        If impairment indicators arise with respect to intangible assets with finite useful lives, we evaluate impairment by comparing the carrying amount of the asset to the estimated future undiscounted net cash flows expected to be generated by the asset. If estimated future undiscounted net cash flows are less than the carrying amount of the asset, then we estimate the fair value of the asset. We determine the impairment loss by comparing the estimated fair value of the intangible asset to its carrying value and recognize any shortfall from fair value as a loss in the current period.

        We evaluate our investments in unconsolidated entities for impairment whenever events or changes in circumstances indicate that the carrying value of our investment in an unconsolidated joint venture may exceed the fair value. If it is determined that a decline in the fair value of our investment in an unconsolidated joint venture is other-than-temporary, and if such reduced fair value is below its carrying value, an impairment is recorded. The determination of the fair value of investments in unconsolidated joint ventures involves significant judgment. Our estimates consider all available evidence including, as appropriate, the present value of the expected future cash flows discounted at market rates, general economic conditions and trends and other relevant factors.

        Goodwill is tested for impairment at least annually, but more frequently if indicators arise. We first assess qualitative factors to determine the likelihood that the fair value of a reporting unit is less than its carrying amount. Qualitative factors we assess include current macroeconomic conditions, state of the equity and capital markets and our overall financial and operating performance. If we determine it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then we proceed with the two-step approach to evaluating impairment. In the first step of this approach we estimate the fair value of a reporting unit and compare it to the reporting unit's carrying value. Should the carrying value exceed fair value, we proceed with the second step. The second step of this approach requires the fair value of a reporting unit to be assigned to all the assets and liabilities of the reporting unit as if it had been acquired in a business combination at the date of the impairment test. The excess fair value of the reporting unit over amounts assigned to the assets and liabilities is the implied value of goodwill and is used to determine the amount of impairment. We recognize an impairment loss to the extent the carrying value of goodwill exceeds the implied value in the current period.

        Estimates of fair value used in this evaluation of goodwill, investments in real estate and intangibles are based upon discounted future cash flow projections, which are, in turn, based upon a number of estimates and assumptions, such as revenue and expense growth rates, capitalization rates and discount rates. Our ability to accurately predict future operating results and cash flows and estimate and allocate fair values impacts the timing and recognition of impairments. While we believe our assumptions are reasonable, changes in these assumptions may have a material impact on our financial statements. We did not record any impairment charges for the years ended December 31, 2011, 2010 and 2009.

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Note 2—Accounting Policies (Continued)

Assets Held for Sale and Discontinued Operations

        We sell properties from time to time for various reasons, including market conditions or the exercise of purchase options by tenants. We classify certain long-lived assets as held for sale once the criteria, as defined by applicable accounting guidance, has been met. Long-lived assets to be disposed of are reported at the lower of their carrying amount or fair value minus cost to sell and are no longer depreciated. Discontinued operations is defined as a component of an entity that has either been disposed of or is deemed to be held for sale if both the operations and cash flows of the component have been or will be eliminated from ongoing operations as a result of the disposal transaction and the entity will not have any significant continuing involvement in the operations of the component after the disposal transaction. The results of operations and any gain or loss on assets sold or held for sale are reflected in our Consolidated Statements of Income as discontinued operations for all periods presented. We have estimated interest expense allocated to discontinued operations based on property values and our weighted average interest rate or the property's mortgage interest.

Loans Receivable

        We record loans receivable, other than those acquired in connection with a business combination, on our Consolidated Balance Sheets (either in secured loans receivable, net or, with respect to unsecured loans receivable, other assets) at the unpaid principal balance, net of any deferred origination fees, purchase discounts or premiums and valuation allowances. We amortize net deferred origination fees, which are comprised of loan fees collected from the borrower net of certain direct costs, and purchase discounts or premiums over the contractual life of the loan using the effective interest method and recognize any unamortized balances in income immediately if the loan is repaid before its contractual maturity. We regularly evaluate the collectibility of loans receivable based on several factors, including without limitation (i) corporate and facility-level financial and operational reports, (ii) compliance with any financial covenants set forth in the applicable loan agreement, (iii) the financial strength of the borrower and any guarantor, (iv) the payment history of the borrower, and (v) current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to collect all amounts due according to the terms of the applicable loan agreement, we provide a reserve against the portion of the receivable that we estimate may not be collected.

Cash Equivalents

        Cash equivalents consist of highly liquid investments with a maturity date of three months or less when purchased. These investments are stated at cost, which approximates fair value.

Escrow Deposits and Restricted Cash

        Escrow deposits consist of amounts held by us or our lenders to provide for future real estate tax and insurance expenditures and tenant improvements related to our properties and operations. Restricted cash represents amounts paid to us for security deposits and other similar purposes.

Deferred Financing Costs

        We amortize deferred financing costs as a component of interest expense over the terms of the related borrowings using a method that approximates a level yield. Deferred financing costs, net of accumulated amortization, were approximately $26.7 million and $19.5 million at December 31, 2011

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and 2010, respectively. Amortized costs of approximately $17.8 million, $17.8 million and $14.6 million were included in interest expense for the years ended December 31, 2011, 2010 and 2009, respectively.

Marketable Debt and Equity Securities

        We record marketable debt and equity securities as available-for-sale and classify them as a component of other assets on our Consolidated Balance Sheets. We record these securities at fair value and include unrealized gains and losses recorded in stockholders' equity as a component of accumulated other comprehensive income on our Consolidated Balance Sheets. We report interest income, including discount or premium amortization, on marketable debt securities and gains or losses on securities sold, which are based on the specific identification method, in income from loans and investments in our Consolidated Statements of Income.

Derivative Instruments

        We recognize all derivative instruments in either other assets or accounts payable and other accrued liabilities on our Consolidated Balance Sheets at fair value as of the reporting date. We recognize changes in the fair value of derivative instruments in other expenses in our Consolidated Statements of Income or accumulated other comprehensive income on our Consolidated Balance Sheets, depending on the intended use of the derivative and our designation of the instrument.

        We do not use our derivative financial instruments, including interest rate caps, interest rate swaps, and foreign currency forward contracts, for trading or speculative purposes. Our interest rate caps were designated as having a hedging relationship with their underlying securities and therefore meet the criteria for hedge accounting under GAAP. Our interest rate caps are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in accumulated other comprehensive income on our Consolidated Balance Sheets. Our interest rate swaps (excluding the interest rate swap contract of an unconsolidated joint venture described below) and foreign currency forward contracts were not designated as having a hedging relationship with their underlying securities and therefore do not meet the criteria for hedge accounting under GAAP. Our interest rate swaps and foreign currency forward contracts are recorded on our Consolidated Balance Sheets at fair value, and we recognize changes in the fair value of these instruments in current earnings (in other expenses) in our Consolidated Statements of Income. One of our unconsolidated joint ventures is party to an interest rate swap contract that was designated as effectively hedging the variability of expected cash flows related to variable rate debt secured by a portion of its real estate portfolio. We recognize our proportionate share of the change in fair value of this swap in accumulated other comprehensive income on our Consolidated Balance Sheets.

Fair Values of Financial Instruments

        Fair value is a market-based measurement, not an entity-specific measurement, and we determine fair value based on the assumptions that we expect market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, FASB guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within levels one and two of the hierarchy) and the reporting entity's own assumptions about market participant assumptions (unobservable inputs classified within level three of the hierarchy).

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Note 2—Accounting Policies (Continued)

        Level one inputs utilize unadjusted quoted prices for identical assets or liabilities in active markets that the reporting entity has the ability to access. Level two inputs are inputs other than quoted prices included in level one that are directly or indirectly observable for the asset or liability. Level two inputs may include quoted prices for similar assets and liabilities in active markets, as well as other inputs for the asset or liability, such as interest rates, foreign exchange rates and yield curves, which are observable at commonly quoted intervals. Level three inputs are unobservable inputs for the asset or liability, which are typically based on the reporting entity's own assumptions, as there is little, if any, related market activity. If the determination of the fair value measurement is based on inputs from different levels of the hierarchy, the level within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

        We use the following methods and assumptions in estimating fair value of financial instruments.

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Revenue Recognition

        Certain of our triple-net leases, including the majority of our leases with Brookdale Senior Living and the majority of leases we acquired in connection with the NHP acquisition, and most of our MOB leases provide for periodic and determinable increases in base rent. We recognize base rental revenues under these leases on a straight-line basis over the applicable lease term when collectability is reasonably assured. Recognizing rental income on a straight-line basis results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in other assets on our Consolidated Balance Sheets. At December 31, 2011 and 2010, this cumulative excess (net of allowances) totaled $96.9 million and $86.3 million, respectively.

        Our master lease agreements with Kindred (the "Kindred Master Leases") and certain of our other leases provide for periodic increases in base rent only if certain revenue parameters or other substantive contingencies are met. We recognize the increased rental revenue under these leases as the related parameters or contingencies are met, rather than on a straight-line basis over the applicable lease term.

        We recognize resident fees and services, other than move-in fees, monthly as services are provided. We recognize move-in fees on a straight-line basis over the average resident stay. Our lease agreements with residents generally have a term of twelve to eighteen months and are cancelable by the resident upon 30 days' notice.

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        We recognize interest income from loans, including discounts and premiums, using the effective interest method when collectibility is reasonably assured. We apply the effective interest method on a loan-by-loan basis and recognize discounts and premiums as yield adjustments over the related loan term. We recognize interest income on an impaired loan to the extent our estimate of the fair value of the collateral is sufficient to support the balance of the loan, other receivables and all related accrued interest. When the balance of the loan, other receivables and all related accrued interest is equal to our estimate of the fair value of the collateral, we recognize interest income on a cash basis. We provide a reserve against an impaired loan to the extent our total investment in the loan exceeds our estimate of the fair value of the loan collateral.

        We recognize income from rent, lease termination fees, management advisory services and all other income when all of the following criteria are met in accordance with Securities and Exchange Commission ("SEC") Staff Accounting Bulletin 104: (i) the applicable agreement has been fully executed and delivered; (ii) services have been rendered; (iii) the amount is fixed or determinable; and (iv) collectibility is reasonably assured.

        We assess the collectibility of our rent receivables, including straight-line rent receivables, in accordance with the applicable accounting standards and our reserve policy, and we defer recognition of revenue if collectibility is not reasonably assured. We base our assessment of the collectibility of rent receivables (excluding straight-line receivables) on several factors, including, among other things, payment history, the financial strength of the tenant and any guarantors, the value of the underlying collateral, if any, and current economic conditions. If our evaluation of these factors indicates it is probable that we will be unable to recover the full value of the receivable, we provide a reserve against the portion of the receivable that we estimate may not be recovered. We base our assessment of the collectibility of straight-line receivables on several factors, including, among other things, the financial strength of the tenant and any guarantors, the historical operations and operating trends of the property, the historical payment pattern of the tenant, and the type of property. If our evaluation of these factors indicates it is probable that we will be unable to receive the rent payments due in the future, we defer recognition of the straight-line rental income and, in certain circumstances, provide a reserve against the previously recognized straight-line rent receivable asset for a portion, up to its full value, that we estimate may not be recovered. If we change our assumptions or estimates regarding the collectibility of future rent payments required by a lease, we may adjust our reserve to increase or reduce the rental revenue recognized and/or to increase or reduce the reserve against the existing straight-line rent receivable.

Stock-Based Compensation

        We account for stock-based compensation in accordance with FASB guidance requiring all share-based payments to employees and directors, including grants of stock options, to be recognized in our Consolidated Statements of Income generally on a straight-line basis over the requisite service period based on the fair value of the award.

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Gain on Sale of Assets

        We recognize sales of assets only upon the closing of the transaction with the purchaser. We record payments received from purchasers prior to closing as deposits and classify them as other assets on our Consolidated Balance Sheets. We recognize gains on assets sold using the full accrual method upon closing if the collectibility of the sales price is reasonably assured, we are not obligated to perform any significant activities after the sale to earn the profit, we have received adequate initial investment from the purchaser, and other profit recognition criteria have been satisfied. We may defer recognition of gains in whole or in part until (i) the profit is determinable, meaning that the collectibility of the sales price is reasonably assured or the amount that will not be collectible can be estimated, and (ii) the earnings process is virtually complete, meaning that we are not obliged to perform any significant activities after the sale to earn the profit.

Federal Income Tax

        We have elected to be treated as a REIT under the applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"), for every year beginning with the year ended December 31, 1999 and have made no provision for REIT income and expense, other than for certain unrecognized tax benefit items. However, we record income tax expense or benefit with respect to certain of our entities that are taxed as "taxable REIT subsidiaries" under provisions similar to those applicable to regular corporations.

        We account for deferred income taxes using the asset and liability method and recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in our financial statements or tax returns. Under this method, we determine deferred tax assets and liabilities based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Any increase or decrease in the deferred tax liability that results from a change in circumstances, and that causes us to change our judgment about expected future tax consequences of events, is included in the tax provision when such changes occur. Deferred income taxes also reflect the impact of operating loss and tax credit carryforwards. A valuation allowance is provided if we believe it is more likely than not that all or some portion of the deferred tax asset will not be realized. Any increase or decrease in the valuation allowance that results from a change in circumstances, and that causes us to change our judgment about the realizability of the related deferred tax asset, is included in the tax provision when such changes occur.

Foreign Currency

        Certain of our subsidiaries' functional currencies are the local currencies of their respective countries. We translate the results of operations of our foreign subsidiaries into U.S. dollars using average rates of exchange in effect during the period, and we translate balance sheet accounts using exchange rates in effect at the end of the period. We record resulting currency translation adjustments in accumulated other comprehensive income, a component of stockholders' equity, on our Consolidated Balance Sheets. We record transaction gains and losses in our Consolidated Statements of Income.

Segment Reporting

        As of December 31, 2011, we operated through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. Our triple-net leased properties

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segment consists of acquiring and owning seniors housing and healthcare properties in the United States and leasing those properties to healthcare operating companies under "triple-net" or "absolute-net" leases that obligate the tenants to pay all property-related expenses. Our senior living operations segment consists of investments in seniors housing communities located in the United States and Canada for which we engage independent third parties, such as Atria and Sunrise, to manage the operations. Our MOB operations segment primarily consists of acquiring, owning, developing, leasing and managing MOBs.

        On July 1, 2010, we completed the acquisition of businesses owned and operated by Lillibridge and its related entities and their real estate interests in 96 MOBs and ambulatory facilities. With the addition of these businesses and properties, we believed the segregation of our MOB operations into its own reportable business segment would be useful in assessing the performance of this portion of our business in the same way that management intends to review our performance and make operating decisions. Prior to the acquisition, we operated through two reportable business segments: triple-net leased properties and senior living operations. See "Note 20—Segment Information."

Convertible Debt Instruments

        On January 1, 2009, we adopted FASB guidance relating to convertible debt instruments that may be settled in cash upon conversion. The guidance specifies that issuers of convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) should separately account for the liability and equity components in a manner that will reflect the entity's nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. Our nonconvertible debt borrowing rate at the time our convertible senior notes were issued was 61/8%. Applying this guidance, interest expense increased and net income decreased by $4.0 million ($0.02 per diluted share), $4.2 million ($0.03 per diluted share) and $3.9 million ($0.03 per diluted share) for the years ended December 31, 2011, 2010 and 2009, respectively, and total equity increased by $12.1 million at December 31, 2008, which includes the calculated equity component of $19.5 million. In November 2011, we repaid in full $230.0 million principal amount outstanding of our convertible notes upon maturity and issued 943,714 shares of our common stock in settlement of the conversion value in excess of the principal amount. See "Note 10—Borrowing Arrangements."

Leases

        We include assets under capital leases within net real estate assets, and we include capital lease obligations within senior notes payable and other debt, on our Consolidated Balance Sheets. We segregate lease payments under capital lease arrangements between interest expense and a reduction to the outstanding principal balance using the effective interest method. We account for payments made pursuant to operating leases in our Consolidated Statements of Income based on actual rent paid, plus or minus a straight-line rent adjustment for leases that provide for periodic and determinable increases in base rent.

Redeemable Limited Partnership Unitholder Interests

        In connection with the NHP acquisition, we acquired a majority interest in NHP/PMB L.P. ("NHP/PMB"), a limited partnership that was formed in 2008 to acquire properties from entities affiliated with Pacific Medical Buildings LLC. We consolidate NHP/PMB, as our wholly owned subsidiary is the general partner and exercises control of the partnership. As of December 31, 2011,

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Note 2—Accounting Policies (Continued)

third party investors owned 2,371,415 Class A limited partnership units in NHP/PMB ("OP Units"), which represented 28.9% of the total units then outstanding, and we owned 5,845,038 Class B limited partnership units in NHP/PMB, representing the remaining 71.1%. At any time following the first anniversary of the date of their issuance, the OP Units may be redeemed at the election of the holder for cash or, at our option, 0.7866 shares of our common stock per unit, subject to adjustment in certain circumstances. We are party by assumption to a registration rights agreement with the holders of the OP Units that requires us, subject to the terms and conditions set forth therein, to file and maintain a registration statement relating to the issuance of shares of our common stock upon redemption of OP Units. As redemption rights are outside of our control, the redeemable OP unitholder interests are classified outside of permanent equity on our Consolidated Balance Sheets. We applied the provisions of ASC Topic 480, Distinguishing Liabilities from Equity, to reflect the redeemable OP unitholder interests at the greater of cost or fair value. As of December 31, 2011, the fair value of the redeemable OP unitholder interests was $102.8 million. The change in fair value from the acquisition date to December 31, 2011 has been recorded through capital in excess of par value, net of cash distributions paid and purchases by us of any OP Units. Our diluted earnings per share ("EPS") includes the effect of any potential shares outstanding from these OP Units.

Noncontrolling Interests

        We present the portion of any equity that we do not own in entities that we control (and thus consolidate) as noncontrolling interests and classify such interests as a component of consolidated equity, separate from total Ventas stockholders' equity, on our Consolidated Balance Sheets. We account for purchases or sales of equity interests that do not result in a change of control as equity transactions, through additional paid-in capital. In addition, we include net income attributable to the noncontrolling interests in net income in our Consolidated Statements of Income and, upon a gain or loss of control, we record the interest purchased or sold, as well as any interest retained, at its fair value and recognize any gain or loss in earnings.

        As of December 31, 2011 and 2010, we had controlling interests in 29 properties and six properties, respectively, owned through joint ventures. The noncontrolling interests in these properties as of December 31, 2011 and 2010 were $81.0 million and $3.5 million, respectively. For the years ended December 31, 2011, 2010 and 2009, we recorded a loss attributable to noncontrolling interests of $1.2 million, income attributable to noncontrolling interests of $3.6 million and income attributable to noncontrolling interests of $2.9 million, respectively.

Recently Issued or Adopted Accounting Standards

        In December 2011, the FASB issued Accounting Standards Update ("ASU") 2011-10, Derecognition of in Substance Real Estate—a Scope Clarification ("ASU 2011-10"), which clarifies certain guidance for situations in which a reporting entity ceases to have a controlling financial interest in a subsidiary that is, in substance, real estate as a result of default on the subsidiary's nonrecourse debt. In such situations, ASU 2011-10 requires a company to apply the provisions of ASC Topic 360, Property, Plant, and Equipment, in determining whether it should derecognize the real estate assets. The provisions of ASU 2011-10 will be effective for us beginning with fiscal year 2013 and are not expected to have a significant impact on our Consolidated Financial Statements.

        In September 2011, the FASB issued ASU 2011-08, Testing Goodwill for Impairment ("ASU 2011-08"), which permits companies to first assess qualitative factors to determine the likelihood

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Note 2—Accounting Policies (Continued)

that the fair value of a reporting unit is less than its carrying amount, before performing the current two-step analysis. If a company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the company must proceed with the two-step approach to evaluating impairment. We adopted the provisions of ASU 2011-08 in 2011, and the adoption did not impact our Consolidated Financial Statements. On January 1, 2011, we adopted ASU 2010-28, When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts ("ASU 2010-28"). ASU 2010-28 states that if a reporting unit has a carrying amount that is equal to or less than zero and there are qualitative factors that indicate it is more likely than not that a goodwill impairment exists, Step 2 of the goodwill impairment test must be performed. The adoption of ASU 2010-28 also did not impact our Consolidated Financial Statements.

        In June 2011, the FASB issued ASU 2011-05, Presentation of Comprehensive Income ("ASU 2011-05"), which amends current guidance found in ASC Topic 220, Comprehensive Income. ASU 2011-05 requires entities to present comprehensive income in either: (i) one continuous financial statement or (ii) two separate but consecutive statements that display net income and the components of other comprehensive income. Totals and individual components of both net income and other comprehensive income must be included in either presentation. In December 2011, the FASB issued ASU 2011-12, Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05 ("ASU 2011-12"). The provisions of ASU 2011-12 indefinitely defer portions of ASU 2011-05 related to the presentation of reclassification of items out of accumulated other comprehensive income. The provisions of both ASU 2011-05 and ASU 2011-12 will be effective for us beginning with the first quarter of 2012.

        On January 1, 2011, we adopted ASU 2010-29, Disclosure of Supplementary Pro Forma Information for Business Combinations ("ASU 2010-29"), affecting public entities that enter into business combinations that are material on an individual or aggregate basis. ASU 2010-29 specifies that if a public entity presents comparative financial statements, it should disclose revenues and earnings of the combined entity as though the business combination(s) that occurred during the year had occurred at the beginning of the prior annual reporting period when preparing the pro forma financial information for both the current and prior reporting periods. The guidance, which is effective for business combinations consummated in reporting periods beginning after December 15, 2010, also requires that pro forma disclosures be accompanied by a narrative description regarding the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination(s) included in reported pro forma revenues and earnings. We have presented supplementary pro forma information related to our acquisition of substantially all of the real estate assets and working capital of Atria Senior Living Group, Inc. (together with its affiliates, "ASLG") in May 2011 and our acquisition of NHP in July 2011 in "Note 4—Acquisitions of Real Estate Property."

        In January 2010, the FASB issued ASU 2010-06, Improving Disclosures about Fair Value Measurements ("ASU 2010-06"), which expands required disclosures related to an entity's fair value measurements. Certain provisions of ASU 2010-06 were effective for interim and annual reporting periods beginning after December 15, 2009, and we adopted those provisions as of January 1, 2010. The remaining provisions, which were effective for interim and annual reporting periods beginning after December 15, 2010, require additional disclosures related to purchases, sales, issuances and settlements in an entity's reconciliation of recurring level three investments. We adopted those provisions of ASU 2010-06 as of January 1, 2011. The adoption of ASU 2010-06 did not impact our Consolidated Financial Statements.

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Note 2—Accounting Policies (Continued)

Reclassifications

        Certain prior year amounts have been reclassified to conform to the current year presentation.

Note 3—Concentration of Credit Risk

        As of December 31, 2011, Atria, Sunrise, Brookdale Senior Living and Kindred managed or operated approximately 19.0%, 14.4%, 13.0% and 5.0%, respectively, of our real estate investments based on their gross book value (including amounts held for sale as of December 31, 2011). Also, as of December 31, 2011, seniors housing communities constituted approximately 66.7% of our real estate portfolio based on gross book value (including amounts held for sale as of December 31, 2011), with skilled nursing facilities, hospitals, MOBs and other healthcare assets collectively comprising the remaining 33.3%. Our properties were located in 46 states, the District of Columbia and two Canadian provinces as of December 31, 2011, with properties in only one state (California) accounting for more than 10% of our total revenues or net operating income ("NOI", which is defined as total revenues, excluding interest and other income, less property-level operating expenses and medical office building services costs) (including amounts in discontinued operations) for the year ended December 31, 2011. Properties in two states (California and Illinois) each accounted for more than 10% of our total revenues or NOI (including amounts in discontinued operations related to properties held for sale at December 31, 2009) for the years ended December 31, 2010 and 2009, respectively.

Triple-Net Leased Properties

        For the years ended December 31, 2011, 2010 and 2009, approximately 14.3%, 24.2% and 26.2%, respectively, of our total revenues and 23.2%, 35.6% and 38.5%, respectively, of our total NOI (including amounts in discontinued operations) were derived from our lease agreements with Kindred. For the same periods, approximately 8.2%, 11.9% and 12.9%, respectively, of our total revenues and 13.4%, 17.3% and 19.1%, respectively, of our total NOI (including amounts in discontinued operations) were derived from our lease agreements with Brookdale Senior Living. Each of the Kindred Master Leases and our leases with Brookdale Senior Living is a triple-net lease pursuant to which the tenant is required to pay all property-level expenses and to comply with the terms of the mortgage financing documents, if any, affecting the properties.

        Because the properties we lease to Kindred and Brookdale Senior Living account for a significant portion of our total revenues and NOI, our financial condition and results of operations could be weakened and our ability to service our indebtedness and to make distributions to our stockholders could be limited if either Kindred or Brookdale Senior Living were unable or unwilling to satisfy its obligations to us or to renew its leases with us upon expiration of the terms thereof. We cannot provide any assurance that either Kindred or Brookdale Senior Living will have sufficient assets, income and access to financing to enable them to satisfy their respective obligations to us, and any inability or unwillingness by Kindred or Brookdale Senior Living to do so could have a material adverse effect on our business, financial condition, results of operations and liquidity, on our ability to service our indebtedness and other obligations and on our ability to make distributions to our stockholders, as required for us to continue to qualify as a REIT (a "Material Adverse Effect"). We also cannot provide any assurance that either Kindred or Brookdale Senior Living will elect to renew its respective leases with us upon expiration of their terms or that we will be able to reposition any properties that are not renewed on a timely basis or on the same or better economic terms, if at all.

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Note 3—Concentration of Credit Risk (Continued)

        The 197 properties we lease to Kindred pursuant to the Kindred Master Leases are grouped into bundles or renewal groups (each, a "renewal group") containing a varying number of properties. All properties within a single renewal group have the same primary lease term of ten to fifteen years (commencing May 1, 1998), and each renewal group is subject to three successive five-year renewal terms at the tenant's option, provided certain conditions are satisfied.

        The current lease term for ten renewal groups covering a total of 89 properties leased to Kindred (the "Renewal Assets") will expire on April 30, 2013 unless Kindred provides us with renewal notices with respect to one or more of those bundles on or before April 30, 2012. In November 2011, we received renewal notices from Kindred with respect to two renewal groups covering a total of sixteen Renewal Assets (the "Early Renewal Assets") and collectively representing approximately $23 million of current annual base rent. In December 2011, we initiated a fair market rental reset process with respect to certain Early Renewal Assets. While we believe that aggregate annual base rent for those Early Renewal Assets is likely to increase as a result of the reset process, we cannot provide any assurance regarding the final determination of fair market rent, which is highly speculative and may be influenced by a variety of factors. In addition, in certain cases Kindred may have the right to revoke its renewal of those Early Renewal Assets for which we initiated the fair market rental reset process.

        The remaining eight renewal groups covering a total of 73 Renewal Assets collectively represent approximately $99 million of current annual base rent, and each renewal group contains six or more properties, including at least one hospital. Kindred is required to continue to perform all of its obligations under the applicable Kindred Master Lease for the Renewal Assets within any renewal group that is not renewed until expiration of the term on April 30, 2013, including without limitation payment of all rental amounts. Therefore, as to any renewal group for which we do not receive a renewal notice, we will have at least one year to arrange for the repositioning of the applicable Renewal Assets with new operators. Moreover, we own or have the rights to all licenses and CONs at the properties, and Kindred has extensive and detailed obligations to cooperate and ensure an orderly transition of the properties to another operator.

        Pursuant to the terms of the Kindred Master Leases, we will have a unilateral group-by-group option to initiate a fair market rental reset process with respect to four of the eight remaining renewal groups covering a total of 37 Renewal Assets and collectively representing approximately $43 million of current annual base rent (the "Remaining Reset Assets") should Kindred provide renewal notices with respect to one or more of those renewal groups. If we initiate the fair market rental reset process for any renewal group comprising the Remaining Reset Assets, the annual base rent for the assets in that renewal group for the first year of the renewal term (commencing May 1, 2013) will be the higher of the contractually escalated rent and fair market rent, as determined by the appraisal process set forth in the Kindred Master Leases.

        We cannot provide any assurance that Kindred will elect to renew any or all of the remaining eight renewal groups whose lease expires April 30, 2013, that Kindred will not revoke its renewal of the Early Renewal Assets for which we initiated the fair market rental reset process, or that we will be able to reposition any or all non-renewed assets on a timely basis or on the same or better economic terms, if at all. See "Risk Factors—Risks Arising from Our Business—If we must replace any of our tenants or operators, we might be unable to reposition the properties on as favorable terms, or at all, and we could be subject to delays, limitations and expenses, which could have a Material Adverse Effect on us" included in Item 1A of this Annual Report on Form 10-K.

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Note 3—Concentration of Credit Risk (Continued)

        The current lease term for the 108 properties leased to Kindred not comprising the Renewal Assets will expire on April 30, 2015, subject to Kindred's two sequential five-year renewal options for those assets.

        The following table sets forth the future contracted minimum rentals, excluding contingent rent escalations, but including straight-line rent adjustments where applicable, for all of our triple-net and MOB leases as of December 31, 2011 (excluding properties included in investments in unconsolidated entities and properties held for sale as of December 31, 2011):

 
  Kindred   Brookdale
Senior
Living
  Other   Total  
 
  (In thousands)
 

2012

  $ 260,530   $ 161,203   $ 598,235   $ 1,019,968  

2013

    181,126     160,018     584,414     925,558  

2014

    142,730     149,316     572,206     864,252  

2015

    48,785     138,514     550,927     738,226  

2016

    1,009     136,846     502,890     640,745  

Thereafter

        439,387     2,969,762     3,409,149  
                   

Total

  $ 634,180   $ 1,185,284   $ 5,778,434   $ 7,597,898  
                   

Senior Living Operations

        As of December 31, 2011, Atria and Sunrise, collectively, provided comprehensive property management and accounting services with respect to 197 of our seniors housing communities for which we pay an annual management fee pursuant to long-term management agreements. Each management agreement with Atria has a term of ten years commencing in 2011, subject to successive automatic ten-year renewal periods, and each management agreement with Sunrise has a term of 30 years commencing as early as 2004. Under the Sunrise management agreements, our management fee was reduced to 3.75% of revenues generated by the applicable properties for 2011, but will revert to 6% of revenues generated by the applicable properties (with a range of 5% to 7%) for 2012 and thereafter.

        Because Atria and Sunrise manage, but do not lease, our properties, we are not directly exposed to their credit risk in the same manner or to the same extent as our triple-net tenants. However, we rely on our managers' personnel, good faith, expertise, historical performance, technical resources and information systems, proprietary information and judgment to manage our seniors housing communities efficiently and effectively. We also rely on our managers to set resident fees and otherwise operate those properties in compliance with the terms of our management agreements. Although we have various rights as the property owner under our management agreements, Atria's or Sunrise's inability or unwillingness to satisfy its obligations under those agreements, to efficiently and effectively manage our properties or to provide timely and accurate accounting information with respect thereto could have a Material Adverse Effect on us. In addition, significant changes in Atria's or Sunrise's senior management or any adverse developments in their business and affairs or financial condition could have a Material Adverse Effect on us.

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Note 3—Concentration of Credit Risk (Continued)

Kindred, Brookdale Senior Living, Sunrise and Atria Information

        Each of Kindred, Brookdale Senior Living and Sunrise is subject to the reporting requirements of the SEC and is required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information. The information related to Kindred, Brookdale Senior Living and Sunrise contained or referred to in this Annual Report on Form 10-K is derived from SEC filings made by Kindred, Brookdale Senior Living or Sunrise, as the case may be, or from other publicly available information, or has been provided to us by Kindred, Brookdale Senior Living or Sunrise. We have not verified this information either through an independent investigation or by reviewing Kindred's, Brookdale Senior Living's or Sunrise's public filings. We have no reason to believe that this information is inaccurate in any material respect, but we cannot provide any assurance that all of this information is accurate. Kindred's, Brookdale Senior Living's and Sunrise's filings with the SEC can be found at the SEC's website at www.sec.gov. We are providing this data for informational purposes only, and you are encouraged to obtain Kindred's, Brookdale Senior Living's and Sunrise's publicly available filings from the SEC.

        Atria is not subject to the reporting requirements of the SEC. The information related to Atria contained or referred to in this Annual Report on Form 10-K is derived from publicly available information or has been provided to us by Atria. We have not verified this information through an independent investigation. We have no reason to believe that this information is inaccurate in any material respect, but we cannot provide any assurance that all of this information is accurate.

Note 4—Acquisitions of Real Estate Property

        The following summarizes our acquisitions in 2011, 2010 and 2009. We engage in acquisition activity primarily to invest in additional seniors housing and healthcare properties and achieve an expected yield on investment, to grow and diversify our portfolio and revenue base and to reduce our dependence on any single tenant, operator or manager, geographic area, asset type, business model or revenue source.

ASLG

        In May 2011, we acquired substantially all of the real estate assets and working capital of privately-owned ASLG. We funded a portion of the purchase price through the issuance of 24.96 million shares of our common stock (which shares had a total value of $1.38 billion based on the acquisition date closing price of our common stock of $55.33 per share). In October 2011, we cancelled 83,441 shares issued to the sellers for a working capital adjustment in accordance with the purchase agreement.

        As a result of the ASLG transaction, we added to our senior living operating portfolio 117 private pay seniors housing communities and one development land parcel located primarily in affluent coastal markets such as the New York metropolitan area, New England and California. Prior to the closing, ASLG spun off its management operations to a newly formed entity, Atria, which continues to operate the acquired assets under long-term management agreements with us. For the period from May 12, 2011 through December 31, 2011, revenues attributable to the acquired assets were $403.2 million and NOI attributable to the acquired assets was $122.1 million.

        We are accounting for the ASLG acquisition under the acquisition method in accordance with ASC Topic 805, Business Combinations ("ASC 805"). The following table summarizes the acquisition

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Note 4—Acquisitions of Real Estate Property (Continued)

date fair values of the assets acquired and liabilities assumed, which we determined using level two and level three inputs (in thousands):

Land and improvements

  $ 341,540  

Buildings and improvements

    2,876,717  

Acquired lease intangibles

    160,340  

Other assets

    216,009  
       

Total assets acquired

    3,594,606  

Notes payable and other debt

    1,629,212  

Deferred tax liability

    44,608  

Other liabilities

    202,167  
       

Total liabilities assumed

    1,875,987  
       

Net assets acquired

    1,718,619  

Cash acquired

    77,718  

Equity issued

    1,376,437  
       

Total cash used

  $ 264,464  
       

        The allocation of fair values of the assets acquired and liabilities assumed has changed and is subject to further adjustment from the allocation reported in "Note 4-Acquisitions of Real Estate Property" of the Notes to Consolidated Financial Statements included in Part I of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2011, filed with the SEC on November 7, 2011, due primarily to reclassification adjustments for presentation, adjustments to our valuation assumptions and final purchase price settlement with the sellers in accordance with the terms of the purchase agreement. The changes to our valuation assumptions were based on more accurate information concerning the subject assets and liabilities. None of these changes had a material impact on our Consolidated Financial Statements.

        Included in other assets is $81.0 million of goodwill, which represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed as of the acquisition date. All of the goodwill was assigned to our senior living operations reportable segment, and we do not expect to deduct any of the goodwill balance for tax purposes.

        As of December 31, 2011, we had incurred a total of $53.3 million of acquisition-related costs related to the ASLG acquisition, all of which were expensed as incurred and included in merger-related expenses and deal costs in our Consolidated Statements of Income for the applicable periods. For the year ended December 31, 2011, we expensed $48.9 million of acquisition-related costs related to the ASLG acquisition.

        As partial consideration for the ASLG acquisition, the sellers received the right to earn additional amounts ("contingent consideration") based upon the achievement of certain performance metrics, including the future operating results of the acquired assets, and other factors. The contingent consideration, if any, will be payable to the sellers following the applicable measurement date for the period ending December 31, 2014 or December 31, 2015, at the election of the sellers. We cannot determine the actual amount of contingent consideration, if any, that may become due to the sellers because it is dependent on various factors, such as the future performance of the acquired assets and our equity multiple, which are subject to many risks and uncertainties beyond our control. We are also unable to estimate a range of potential outcomes for the same reason. We estimated the fair value of

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Note 4—Acquisitions of Real Estate Property (Continued)

contingent consideration as of the acquisition date and as of December 31, 2011 using probability assessments of expected future cash flows over the period in which the obligation is expected to be settled and applying a discount rate that appropriately captures a market participant's view of the risk associated with the obligation. This contingent consideration liability is carried on our Consolidated Balance Sheets as of December 31, 2011 at its discounted fair value, and we record any changes in its discounted fair value in earnings in our Consolidated Statements of Income. As of both December 31, 2011 and the acquisition date, the estimated discounted fair value of contingent consideration was $44.2 million.

NHP Acquisition

        In July 2011, we acquired NHP in a stock-for-stock transaction. Pursuant to the terms and subject to the conditions set forth in the agreement and plan of merger dated as of February 27, 2011, at the effective time of the merger, each outstanding share of NHP common stock (other than shares owned by us or any of our subsidiaries or any wholly owned subsidiary of NHP) was converted into the right to receive 0.7866 shares of our common stock, with cash paid in lieu of fractional shares. In connection with the acquisition, we paid $105 million at closing to repay amounts then outstanding and terminated the commitments under NHP's revolving credit facility. The NHP acquisition added 643 seniors housing and healthcare properties to our portfolio (including properties owned through joint ventures). For the period from July 1, 2011 through December 31, 2011, revenues attributable to the acquired assets were $269.1 million and NOI attributable to the acquired assets was $245.1 million (including amounts in discontinued operations).

        We are accounting for the NHP acquisition under the acquisition method in accordance with ASC 805, and we have completed our initial accounting for this acquisition, which is subject to further adjustment. The following table summarizes the acquisition date fair values of the assets acquired and liabilities assumed, which we determined using level two and level three inputs (in thousands):

Land and improvements

  $ 704,315  

Buildings and improvements

    6,216,925  

Acquired lease intangibles

    503,451  

Investment in unconsolidated entities

    93,553  

Other assets

    756,074  
       

Total assets acquired

    8,274,318  

Notes payable and other debt

    1,882,752  

Other liabilities

    744,410  
       

Total liabilities assumed

    2,627,162  
       

Redeemable OP unitholder interests assumed

    100,888  

Noncontrolling interest assumed

    79,773  
       

Net assets acquired

    5,466,495  

Cash acquired

    29,202  

Equity issued

    5,361,495  
       

Total cash used

  $ 75,798  
       

        The allocation of fair values of the assets acquired and liabilities assumed has changed and is subject to further adjustment from the allocation reported in "Note 4—Acquisitions of Real Estate

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Note 4—Acquisitions of Real Estate Property (Continued)

Property" of the Notes to Consolidated Financial Statements included in Part I of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2011, filed with the SEC on November 7, 2011, due primarily to reclassification adjustments for presentation, adjustments to our valuation assumptions and acquiring additional information not readily available at the date of acquisition. The changes to our valuation assumptions were based on more accurate information concerning the subject assets and liabilities. The changes related primarily to a decrease in investments in real estate of approximately $161.6 million and a corresponding increase in other assets.

        Included in other assets is $347.9 million of goodwill, which represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed as of the acquisition date. We have allocated $293.0 million and $54.9 million of the goodwill balance to our triple-net leased properties and MOB operations reportable business segments, respectively, based on relative fair value. We do not expect to deduct any of the goodwill balance for tax purposes.

        As of and for the year ended December 31, 2011, we had incurred a total of $53.3 million of acquisition-related costs related to the NHP acquisition, all of which we expensed as incurred during 2011 and included in merger-related expenses and deal costs in our Consolidated Statements of Income.

Other 2011 Acquisitions

        During 2011, we also invested approximately $329.5 million, including the assumption of $134.9 million in debt, in MOBs and seniors housing communities.

Lillibridge Acquisition

        In July 2010, we completed the acquisition of businesses owned and operated by Lillibridge and its related entities and their real estate interests in 96 MOBs and ambulatory facilities for approximately $381 million, including the assumption of $79.5 million of mortgage debt that was not repaid in connection with the closing.

        As a result of the Lillibridge acquisition, we acquired: a 100% interest in Lillibridge's property management, leasing, marketing, facility development, and advisory services business; a 100% interest in 38 MOBs; a 20% joint venture interest in 24 MOBs; and a 5% joint venture interest in 34 MOBs. We are the managing member of these joint ventures and the property manager for the joint venture properties. Two institutional third parties hold the controlling interests in these joint ventures, and we have a right of first offer on those interests. We funded the acquisition with cash on hand, borrowings under our unsecured revolving credit facilities and the assumption of mortgage debt. In connection with the acquisition, $132.7 million of mortgage debt was repaid.

Other 2010 Acquisitions

        During 2010, we also purchased five MOBs for a purchase price of $36.6 million and acquired Sunrise's noncontrolling interests in 58 of our Sunrise-managed seniors housing communities for a total valuation of approximately $186 million, including the assumption of Sunrise's share of mortgage debt totaling approximately $144 million. The noncontrolling interests acquired represented between 15% and 25% ownership interests in the communities, and we now own 100% of all 79 of our Sunrise-managed seniors housing communities. We recorded the difference between the consideration paid and

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Note 4—Acquisitions of Real Estate Property (Continued)

the noncontrolling interest balance as a component of equity in capital in excess of par value on our Consolidated Balance Sheets.

2009 Acquisitions

        During 2009, we purchased four MOBs for an aggregate purchase price of $77.7 million, including $1.7 million of noncontrolling interest. We own one of these MOBs through a consolidated joint venture with a partner that provides management and leasing services for the property. Additionally, in 2009, we purchased one skilled nursing facility for $10.0 million and leased it to Brookdale Senior Living.

        We also completed the development of two MOBs, both of which we consolidate, pursuant to an arrangement we entered into with a nationally recognized private developer of MOBs and healthcare facilities in 2008. That arrangement gave us the exclusive right, as part of a joint venture, to develop up to ten identified MOBs on hospital campuses in eight states.

Pending Acquisition

        In December 2011, we signed a definitive agreement to acquire Cogdell Spencer Inc. ("Cogdell"), including its 100% ownership interest in 72 MOBs and its MOB property management business, which has existing agreements to manage 44 MOBs, in an all-cash transaction. At closing, we expect our investment in Cogdell, including our share of debt, to approximate $760 million to $770 million, before anticipated transaction expenses.

        Pursuant to the terms of and subject to the conditions set forth in the agreement, at the effective time of the merger, each outstanding share of Cogdell common stock and each outstanding unit of limited partnership interest in Cogdell's operating partnership, Cogdell Spencer LP, will be converted into the right to receive $4.25 per share (or unit), and each outstanding share of Cogdell's preferred stock will be converted into the right to receive $25 per share, plus accrued and unpaid dividends through the closing. Cogdell has also reached an agreement pursuant to which, prior to the closing, Cogdell will sell its design-build and development business to an unaffiliated third party. Completion of the transaction is subject to approval of Cogdell's stockholders, the sale of Cogdell's design-build and development business and certain other customary closing conditions. We expect to complete the Cogdell transaction in the second quarter of 2012, although we cannot provide any assurance as to whether or when the transaction will occur.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 4—Acquisitions of Real Estate Property (Continued)

Unaudited Pro Forma

        The following table illustrates the effect on net income and earnings per share as if we had consummated the ASLG and NHP acquisitions as of January 1, 2010:

 
  For the Year Ended
December 31,
 
 
  2011   2010  
 
  (In thousands, except per
share amounts)

 

Revenues

  $ 2,256,319   $ 2,178,897  

Income from continuing operations attributable to common stockholders

    583,446     321,637  

Earnings per common share:

             

Basic:

             

Income from continuing operations attributable to common stockholders

  $ 2.03   $ 1.14  

Diluted:

             

Income from continuing operations attributable to common stockholders

  $ 2.02   $ 1.14  

Weighted average shares used in computing earnings per common share:

             

Basic

    286,856     281,333  

Diluted

    289,193     282,382  

        Acquisition-related costs related to the ASLG and NHP acquisitions are not expected to have a continuing significant impact on our financial results and therefore have been excluded from these pro forma results. The pro forma results also do not include the impact of any synergies or lower borrowing costs that we have or may achieve as a result of the acquisitions or any strategies that management has or may consider in order to continue to efficiently manage our operations, nor do they give pro forma effect to any other acquisitions, investments, dispositions or capital markets transactions that we completed during the periods presented. These pro forma results are not necessarily indicative of the operating results that would have been obtained had the ASLG and NHP acquisitions occurred at the beginning of the periods presented, nor are they necessarily indicative of future operating results.

Note 5—Dispositions

        We present separately, as discontinued operations, in all periods presented the results of operations for all assets held for sale or disposed of during the three-year period ended December 31, 2011.

2011 Dispositions

        During 2011, we sold two seniors housing communities and two skilled nursing facilities to tenants exercising purchase options for aggregate consideration of $20.6 million. We recognized no gain or loss from these sales. Also, as of December 31, 2011, we classified fifteen properties as held for sale and included their operations in discontinued operations in our Consolidated Income Statements. In February 2012, we sold nine seniors housing communities for aggregate consideration of $121.3 million,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 5—Dispositions (Continued)

including a lease termination fee of $1.8 million. A portion of the proceeds from the sale are being held in a Code Section 1031 exchange escrow account with a qualified intermediary. During the first quarter of 2012, we expect to recognize a gain from the sale of these assets.

2010 Dispositions

        During 2010, we sold seven seniors housing communities for aggregate consideration of $60.5 million, including lease termination fees of $0.7 million, and recognized a gain from these sales of $17.3 million.

2009 Dispositions

        In June 2009, we sold six skilled nursing facilities to Kindred for total consideration of $58.0 million, consisting of an aggregate sale price of $55.7 million and a $2.3 million lease termination fee. The proceeds from the sale were held in a Code Section 1031 exchange escrow account with a qualified intermediary and used for our acquisition of three MOBs in December 2009. We recognized a gain from the sale of these assets of $39.3 million in 2009.

        During 2009, we also sold five seniors housing communities, one hospital, one MOB and one other property to the existing tenants for an aggregate sale price of $96.2 million and transferred related debt of $38.8 million. We recognized a net gain from the sales of these assets of $27.5 million in 2009.

        Set forth below is a summary of the results of operations of properties sold during the years ended December 31, 2011, 2010 and 2009 or classified as held for sale as of December 31, 2011, all of which were included in our triple-net leased properties segment, with the exception of one MOB we sold during 2009 and one MOB classified as held for sale as of December 31, 2011.

 
  2011   2010   2009  
 
  (In thousands)
 

Revenues:

                   

Rental income

  $ 10,071   $ 11,466   $ 16,230  

Interest and other income

        725     2,423  
               

    10,071     12,191     18,653  

Expenses:

                   

Interest

    5,250     4,287     5,926  

Depreciation and amortization

    3,114     2,302     3,960  

Property-level operating expenses

    24          
               

    8,388     6,589     9,886  
               

Income before gain on sale of real estate assets

    1,683     5,602     8,767  

Gain on sale of real estate assets

        25,241     67,305  
               

Discontinued operations

  $ 1,683   $ 30,843   $ 76,072  
               

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 6—Loans Receivable

        As of December 31, 2011 and 2010, we had $276.2 million and $149.3 million, respectively, of net loans receivable relating to seniors housing and healthcare companies or properties.

        In connection with the NHP acquisition, we acquired (i) mortgage loans receivable having an initial aggregate fair value of approximately $271.7 million and secured by 53 seniors housing and healthcare properties and (ii) unsecured loans receivable having an initial aggregate fair value of approximately $60.5 million.

        During 2011, we made a first mortgage loan in the aggregate principal amount of $12.9 million, bearing interest at a fixed rate of 9.0% per annum and maturing in 2016.

        During 2011, we received aggregate proceeds of $218.5 million in final repayment of eight secured loans receivable and recognized an aggregate gain of $4.4 million (included in income from loans and investments in our Consolidated Statements of Income) in connection with these repayments for the year ended December 31, 2011.

        Additionally, during 2011, we received proceeds of $0.3 million in final repayment of one unsecured loan receivable and made additional advances under two existing unsecured loans receivable in the amount of $6.7 million.

        During 2010, we acquired at a 17% discount, a first mortgage loan in the principal amount of $19.0 million bearing interest at a fixed rate of 9.25% per annum and maturing in 2015. During 2011, through foreclosure action, we took title to the two assets securing this mortgage loan. The carrying amount of these assets, totaling $16.0 million, approximated the fair value of the assets at the time of foreclosure and no gain or loss was recorded in connection with obtaining title. Operations from this property were consolidated into our consolidated financial statements during 2011.

Note 7—Investments in Unconsolidated Entities

        We report investments in unconsolidated entities, all of which we acquired in connection with our Lillibridge and NHP acquisitions, over whose operating and financial policies we have the ability to exercise significant influence under the equity method of accounting. We serve as the managing member of each unconsolidated entity and provide various services in exchange for fees and reimbursements. Total management fees earned in connection with these entities were $5.7 million, $1.9 million and $0 for the years ended December 31, 2011, 2010 and 2009, respectively. Our joint venture partners have significant participating rights, and, therefore, we are not required to consolidate these entities. Additionally, these entities are viable entities controlled by equity holders with sufficient capital and, therefore, are not considered variable interest entities. At December 31, 2011 and 2010, we owned interests (ranging between 5% and 25%) in 92 properties and interests (ranging between 5% and 20%) in 58 properties, respectively, that were accounted for under the equity method. Our net investment in these properties as of December 31, 2011 and 2010 was $105.3 million and $15.3 million, respectively. For the years ended December 31, 2011, 2010 and 2009, we recorded a loss from unconsolidated entities of $0.1 million, $0.7 million and $0, respectively.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 8—Intangibles

        The following is a summary of our intangibles as of December 31, 2011 and 2010:

 
  December 31, 2011   December 31, 2010  
 
  Balance   Remaining
Weighted Average
Amortization
Period in Years
  Balance   Remaining
Weighted Average
Amortization
Period in Years
 
 
  (Dollars in thousands)
 

Intangible assets:

                         

Above market lease intangibles

  $ 210,358     10.1   $ 13,232     7.1  

In-place and other lease intangibles

    590,500     22.4     133,582     18.3  

Other intangibles

    16,169     13.5     13,649     17.1  

Accumulated amortization

    (188,442 )   N/A     (100,808 )   N/A  

Goodwill

    448,393     N/A     19,901     N/A  
                       

Net intangible assets

  $ 1,076,978     18.5   $ 79,556     16.9  
                       

Intangible liabilities:

                         

Below market lease intangibles

  $ 442,612     15.3   $ 22,398     6.9  

Other lease intangibles

    27,157     7.9          

Accumulated amortization

    (37,607 )   N/A     (12,495 )   N/A  

Purchase option intangibles

    112,670     N/A          
                       

Net intangible liabilities

  $ 544,832     15.2   $ 9,903     6.9  
                       

N/A—Not
Applicable. 

        Above market lease intangibles and in-place and other lease intangibles are included in acquired lease intangibles within real estate investments on our Consolidated Balance Sheets. Other intangibles (including non-compete agreements and trade names/trademarks) and goodwill are included in other assets on our Consolidated Balance Sheets. Below market lease, other lease and purchase option intangibles are included in accounts payable and other liabilities on our Consolidated Balance Sheets. For the years ended December 31, 2011, 2010 and 2009, our net amortization related to these intangibles was $62.5 million, $6.9 million and $1.9 million, respectively. The estimated net amortization related to these intangibles for each of the next five years is as follows: 2012—$82.9 million; 2013—$19.2 million; 2014—$14.4 million; 2015—$10.4 million; and 2016—$6.4 million.

Note 9—Other Assets

        The following is a summary of our other assets as of December 31, 2011 and 2010:

 
  2011   2010  
 
  (In thousands)
 

Straight-line rent receivables, net

  $ 96,883   $ 86,275  

Marketable debt securities

    43,331     66,675  

Unsecured loans receivable, net

    63,598      

Goodwill and other intangibles, net

    462,655     32,704  

Assets held for sale

    119,290      

Other

    105,475     47,968  
           

Total other assets

  $ 891,232   $ 233,622  
           

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10—Borrowing Arrangements

        The following is a summary of our senior notes payable and other debt as of December 31, 2011 and 2010:

 
  2011   2010  
 
  (In thousands)
 

Unsecured revolving credit facilities

  $ 455,578   $ 40,000  

37/8% Convertible Senior Notes due 2011

        230,000  

9% Senior Notes due 2012

    82,433     82,433  

81/4% Senior Notes due 2012

    72,950      

Unsecured term loan due 2013

    200,000     200,000  

6.25% Senior Notes due 2013

    269,850      

Unsecured term loan due 2015(1)

    126,875      

3.125% Senior Notes due 2015

    400,000     400,000  

6% Senior Notes due 2015

    234,420      

61/2% Senior Notes due 2016

    200,000     400,000  

Unsecured term loan due 2017(1)

    375,000      

63/4% Senior Notes due 2017

    225,000     225,000  

4.750% Senior Notes due 2021

    700,000      

6.90% Senior Notes due 2037

    52,400      

6.59% Senior Notes due 2038

    22,973      

Mortgage loans and other(2)

    2,762,964     1,349,521  
           

Total

    6,180,443     2,926,954  

Capital lease obligations

    143,006      

Unamortized fair value adjustment

    144,923     11,790  

Unamortized commission fees and discounts

    (39,256 )   (38,700 )
           

Senior notes payable and other debt

  $ 6,429,116   $ 2,900,044  
           

(1)
The aggregate amounts presented above represent the $500.0 million of borrowings oustanding under our unsecured term loan facility. Certain amounts included in the 2015 tranche represent Canadian dollar borrowings.

(2)
The amounts presented above exclude debt related to real estate assets classified as held for sale as of December 31, 2011. The total mortgage debt for these properties as of December 31, 2011 was $14.6 million, and is included in accounts payable and other liabilities on the Consolidated Balance Sheet.

        As of December 31, 2011, our joint venture partners' share of total debt was $46.6 million with respect to eight properties we owned through consolidated joint ventures. As of December 31, 2010, our joint venture partners' share of total debt was $4.8 million with respect to three properties we owned through consolidated joint ventures. Total debt does not include our portion of debt related to investments in unconsolidated entities, which was $131.5 million and $45.9 million at December 31, 2011 and 2010, respectively.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10—Borrowing Arrangements (Continued)

Unsecured Revolving Credit Facility and Unsecured Term Loans

        We have $2.0 billion of aggregate borrowing capacity under our unsecured revolving credit facility, which may be increased to up to $2.5 billion at our option, subject to the satisfaction of certain conditions, and includes sublimits of (a) up to $200 million for letters of credit, (b) up to $200 million for swingline loans, (c) up to $250 million for loans in certain alternative currencies, and (d) up to 50% of the facility for certain negotiated rate loans. Borrowings under our unsecured revolving credit facility bear interest at a fluctuating rate per annum (based on the applicable LIBOR for Eurocurrency rate loans and the higher of (i) the federal funds rate plus 0.50%, (ii) the administrative agent's prime rate and (iii) the applicable LIBOR plus 1.0% for base rate loans, plus, in each case, a spread based on our senior unsecured long-term debt ratings). At December 31, 2011, the applicable spread was 110 basis points for Eurocurrency rate loans and 10 basis points for base rate loans. We also pay a facility fee ranging from 15 to 45 basis points per annum (based on our senior unsecured long-term debt ratings) on the aggregate revolving commitments under our unsecured revolving credit facility. At December 31, 2011, the facility fee was 17.5 basis points. Borrowings under our unsecured revolving credit facility mature on October 16, 2015, but may be extended for an additional period of one year at our option, subject to the satisfaction of certain conditions.

        Our unsecured revolving credit facility imposes certain customary restrictions on us, including restrictions pertaining to: (i) liens; (ii) investments; (iii) the incurrence of additional indebtedness; (iv) mergers, sales of assets and dissolutions; (v) certain dividend, distribution and other payments; (vi) permitted businesses; (vii) transactions with affiliates; (viii) agreements limiting certain liens; and (ix) the maintenance of certain consolidated total leverage, secured debt leverage, unsecured leverage and fixed charge coverage ratios and minimum consolidated adjusted net worth, and contains customary events of default.

        At December 31, 2011, we had $455.6 million of borrowings outstanding, $8.3 million of outstanding letters of credit and $1.54 billion of available borrowing capacity under our unsecured revolving credit facility. We also recognized a $2.4 million loss on extinguishment of debt for the three months and year ended December 31, 2011, representing the write-off of unamortized deferred financing fees from our previous unsecured revolving credit facilities.

        In December 2011, we entered into a new $500.0 million unsecured term loan facility with a weighted average maturity of 4.5 years, priced at LIBOR plus 125 basis points. The term loan facility consists of a three-year tranche and a five-year tranche and includes an accordion feature that permits us to expand our borrowing capacity to up to $900.0 million, subject to the satisfaction of certain conditions. Borrowings under the term loan facility may be made in U.S. dollars or Canadian dollars. Concurrently with the closing of the term loan facility, we terminated the commitments under an $800.0 million term loan priced at LIBOR plus 150 basis points and scheduled to mature in June 2012, that was previously extended to NHP and assumed by us in connection with the NHP acquisition.

        In September 2010, we entered into a $200.0 million three-year unsecured term loan with Bank of America, N.A., as lender. The term loan is non-amortizing and bears interest at an all-in fixed rate of 4% per annum.

        Each of the term loan facility and the term loan contains the same restrictive covenants as our unsecured revolving credit facility.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10—Borrowing Arrangements (Continued)

Convertible Senior Notes

        In November 2011, we repaid in full $230.0 million principal amount outstanding of our 37/8% convertible senior notes due 2011 upon maturity. In accordance with the terms of the indenture governing the convertible notes, we paid the principal amount of the notes and accrued but unpaid interest thereon in cash and issued an aggregate of 943,714 shares of our common stock in settlement of the conversion value in excess of the principal amount. The conversion rate of the convertible notes had been subject to adjustment in certain circumstances, including the payment of certain quarterly dividends in excess of a reference amount. To the extent the market price of our common stock exceeded the conversion price, our earnings per share were diluted. The convertible notes had a minimal dilutive impact per share for the years ended December 31, 2011, 2010 and 2009. See "Note 15—Earnings Per Share."

Senior Notes

        As of December 31, 2011, we had $1.6 billion aggregate principal amount of senior notes issued by our subsidiaries, Ventas Realty and Ventas Capital Corporation (collectively, the "Ventas Issuers") outstanding. Prior to 2009, we issued $200.0 million principal amount of our 61/2% senior notes due 2016 at a 1/2% discount to par value, $200.0 million principal amount of our 63/4% senior notes due 2017 at a 5/8% discount to par value and $50.0 million principal amount of our 65/8% senior notes due 2014 at a 1% discount to par value. As of December 31, 2011, we also had outstanding $652.6 million aggregate principal amount of senior notes that were issued by NHP and assumed by our subsidiary, Nationwide Health Properties, LLC ("NHP LLC"), in connection with the NHP acquisition.

        In February 2012, we issued and sold $600.0 million aggregate principal amount of 4.25% senior notes due 2022, at a public offering price equal to 99.214% of par for total proceeds of $595.3 million, before the underwriting discount and expenses.

        Also in February 2012, we exercised our option to redeem all $200.0 million principal amount outstanding of our 61/2% senior notes due 2016 pursuant to the terms of the indenture governing the notes. We will pay a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and expect to recognize a loss on extinguishment of debt in the first quarter of 2012.

        In July 2011, we repaid in full, at par, $339.0 million principal amount then outstanding of NHP LLC's 6.50% senior notes due 2011 upon maturity. NHP LLC's remaining senior notes outstanding bear interest at fixed rates ranging from 6.00% to 8.25% per annum and have maturity dates ranging from July 1, 2012 to July 7, 2038, subject in certain cases to earlier repayment at the option of the holders.

        Also, in July 2011, we redeemed $200.0 million principal amount outstanding of our 61/2% senior notes due 2016, at a redemption price equal to 103.25% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $206.5 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $8.7 million in the third quarter of 2011.

        In May 2011, we issued and sold $700.0 million aggregate principal amount of 4.750% senior notes due 2021, at a public offering price equal to 99.132% of par, for total proceeds of $693.9 million, before the underwriting discount and expenses.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10—Borrowing Arrangements (Continued)

        In November 2010, we issued and sold $400.0 million aggregate principal amount of 3.125% senior notes due 2015, at a public offering price equal to 99.528% of par, for total proceeds of $398.1 million, before the underwriting discount and expenses.

        In October 2010, we redeemed all $71.7 million principal amount outstanding of our 65/8% senior notes due 2014, at a redemption price equal to 102.21% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $73.3 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $2.5 million during the fourth quarter of 2010.

        In June 2010, we redeemed all $142.7 million principal amount outstanding of our 71/8% senior notes due 2015, at a redemption price equal to 103.56% of par, plus accrued and unpaid interest to the redemption date, pursuant to the call option contained in the indenture governing the notes. As a result, we paid a total of $147.8 million, plus accrued and unpaid interest, on the redemption date and recognized a loss on extinguishment of debt of $6.4 million during the second quarter of 2010.

        In May 2010, we repaid in full, at par, $1.4 million principal amount then outstanding of our 63/4% senior notes due 2010 upon maturity.

        During 2009, we issued and sold $200.0 million aggregate principal amount of 61/2% senior notes due 2016 at a 153/4% discount to par value, for total proceeds of $168.5 million, before the underwriting discount and expenses. We also repaid in full, at par, $49.8 million principal amount outstanding of our 83/4% senior notes due 2009 upon maturity, and purchased in open market transactions and/or through cash tender offers $361.6 million of our senior notes composed of: $121.6 million principal amount of our outstanding 63/4% senior notes due 2010; $109.4 million principal amount of our outstanding 9% senior notes due 2012; $103.3 million principal amount of our outstanding 65/8% senior notes due 2014; and $27.3 million principal amount of our outstanding 71/8% senior notes due 2015. We recognized a loss on extinguishment of debt of $6.1 million related to these purchases.

        All of the Ventas Issuers' senior notes are unconditionally guaranteed by Ventas. In addition, at the time of their original issuance, all of the Ventas Issuers' senior notes issued prior to November 2010 were unconditionally guaranteed, jointly and severally, on a senior unsecured basis by certain of our direct and indirect subsidiaries. In September 2010, the subsidiary guarantees on the Ventas Issuers' then outstanding senior notes (other than the 9% senior notes due 2012) were released pursuant to the terms of the indentures governing the notes. The Ventas Issuers' senior notes are part of our and the Ventas Issuers' general unsecured obligations, ranking equal in right of payment with all of our and the Ventas Issuers' existing and future senior obligations and ranking senior to all of our and the Ventas Issuers' existing and future subordinated indebtedness. However, the Ventas Issuers' senior notes are effectively subordinated to our and the Ventas Issuers' secured indebtedness, if any, to the extent of the value of the assets securing that indebtedness. The Ventas Issuers' senior notes are also structurally subordinated to the preferred equity and indebtedness, whether secured or unsecured, of our subsidiaries.

        NHP LLC's senior notes are part of NHP LLC's general unsecured obligations, ranking equal in right of payment with all of NHP LLC's existing and future senior obligations and ranking senior to all of NHP LLC's existing and future subordinated indebtedness. However, NHP LLC's senior notes are effectively subordinated to NHP LLC's secured indebtedness, if any, to the extent of the value of the assets securing that indebtedness. NHP LLC's senior notes are also structurally subordinated to the preferred equity and indebtedness, whether secured or unsecured, of its subsidiaries.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10—Borrowing Arrangements (Continued)

        The Ventas Issuers may redeem each series of their senior notes and NHP LLC may redeem each series of its senior notes (other than the 6.90% senior notes due 2037 and the 6.59% senior notes due 2038), in whole at any time or in part from time to time, prior to maturity at varying redemption prices set forth in the applicable indenture, plus, in each case, accrued and unpaid interest thereon to the redemption date.

        NHP LLC's 6.90% senior notes due 2037 are subject to repurchase at the option of the holders, at par, on October 1 of each of 2012, 2017 and 2027, and NHP LLC's 6.59% senior notes due 2038 are subject to repurchase at the option of the holders, at par, on July 7 of each of 2013, 2018, 2023 and 2028.

        If we experience certain kinds of changes of control, the Ventas Issuers must make an offer to repurchase their 9% senior notes due 2012, 61/2% senior notes due 2016 and 63/4% senior notes due 2017, in whole or in part, at a purchase price in cash equal to 101% of the principal amount thereof, plus any accrued and unpaid interest to the date of purchase; provided, however, that in the event Moody's Investors Service ("Moody's") and Standard & Poor's Ratings Services ("S&P") have confirmed their ratings at Ba3 or higher and BB- or higher on the senior notes and certain other conditions are met, this repurchase obligation will not apply.

Mortgages

        At December 31, 2011, we had 273 mortgage loans outstanding in the aggregate principal amount of $2.8 billion and secured by 228 of our properties. Of these loans, 244 loans in the aggregate principal amount of $2.4 billion bear interest at fixed rates ranging from 4.4% to 8.6% per annum, and 29 loans in the aggregate principal amount of $414.6 million bear interest at variable rates ranging from 0.6% to 7.3% per annum as of December 31, 2011. At December 31, 2011, the weighted average annual rate on our fixed rate mortgage loans was 6.1%, and the weighted average annual rate on our variable rate mortgage loans was 2.0%. Our mortgage loans had a weighted average maturity of 5.8 years as of December 31, 2011.

        During 2011, we assumed mortgage debt of $1.6 billion, including $1.2 billion and $442 million, respectively, in connection with the ASLG and NHP acquisitions.

        In February 2011, we repaid in full mortgage loans outstanding in the aggregate principal amount of $307.2 million and recognized a loss on extinguishment of debt of $16.5 million in connection with these repayments in the first quarter of 2011.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10—Borrowing Arrangements (Continued)

Scheduled Maturities of Borrowing Arrangements and Other Provisions

        As of December 31, 2011, our indebtedness (excluding capital lease obligations) had the following maturities:

 
  Principal Amount
Due at Maturity
  Unsecured
Revolving Credit
Facility(1)
  Scheduled Periodic
Amortization
  Total Maturities  
 
  (In thousands)
 

2012(2)

  $ 267,044   $   $ 52,273   $ 319,317  

2013

    921,890         46,455     968,345  

2014

    237,648         41,993     279,641  

2015

    985,647     455,578     34,163     1,475,388  

2016

    544,370         27,689     572,059  

Thereafter(2)(3)

    2,395,088         170,605     2,565,693  
                   

Total maturities

  $ 5,351,687   $ 455,578   $ 373,178   $ 6,180,443  
                   

(1)
At December 31, 2011, we had $45.8 million of unrestricted cash and cash equivalents, for $409.8 million of net borrowings outstanding under our unsecured revolving credit facility.

(2)
The amounts presented above exclude debt related to real estate assets classified as held for sale as of December 31, 2011. The total mortgage debt for these properties as of December 31, 2011 was $14.6 million and is scheduled to mature as follows: $5.7 million in 2012 and $8.9 million thereafter.

(3)
Includes $52.4 million aggregate principal amount of NHP LLC's 6.90% senior notes due 2037, which are subject to repurchase, at the option of the holders, on October 1 of each of 2012, 2017 and 2027, and $23.0 million aggregate principal amount of NHP LLC's 6.59% senior notes due 2038, which are subject to repurchase, at the option of the holders, on July 7 of each of 2013, 2018, 2023 and 2028.

        The instruments governing our outstanding indebtedness contain covenants that limit our ability and the ability of certain of our subsidiaries to, among other things: (i) incur debt; (ii) make certain dividends, distributions and investments; (iii) enter into certain transactions; (iv) merge, consolidate or transfer certain assets; and (v) sell assets. At any time we maintain investment grade ratings by both Moody's and S&P, the indentures governing certain series of the Ventas Issuers' senior notes provide that some of these restrictive covenants will either be suspended or fall away. The Ventas Issuers' senior notes also require us and our subsidiaries to maintain total unencumbered assets of at least 150% of our unsecured debt. Our unsecured revolving credit facility and term loans also require us to maintain certain financial covenants pertaining to, among other things, our consolidated leverage, secured debt, fixed charge coverage and net worth.

        As of December 31, 2011, we were in compliance with all of these covenants.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10—Borrowing Arrangements (Continued)

Derivatives and Hedging

        In the normal course of our business, we are exposed to the effects of interest rate movements on future cash flows under our variable rate debt obligations and foreign currency exchange rate movements on our senior living operations. We follow established risk management policies and procedures, including the use of derivative instruments, to mitigate these risks.

        For interest rate exposures, we use derivatives primarily to fix the rate on our variable rate debt and to manage the cost of our borrowing obligations. We prohibit the use of derivative instruments for trading or speculative purposes, and we have a policy of entering into contracts only with major financial institutions based upon their credit ratings and other factors. When considered together with the underlying exposure that the derivative is designed to hedge, we do not expect that the use of derivatives in this manner would have any material adverse effect on our future net income or financial position.

Capital Leases

        As of December 31, 2011, we leased eight seniors housing communities pursuant to arrangements we assumed in connection with the ASLG acquisition that are accounted for as capital leases. Under each capital lease agreement, rent is subject to increase based upon changes in the Consumer Price Index or gross revenues attributable to the property, subject to certain limits, and we have a bargain option to purchase the leased property and an option to exercise renewal terms.

        Future minimum lease payments required under the capital lease agreements, including amounts that would be due under purchase options, as of December 31, 2011 are as follows (in thousands):

2012

  $ 9,446  

2013

    9,573  

2014

    9,699  

2015

    9,826  

2016

    9,953  

Thereafter

    162,600  
       

Total minimum lease payments

    211,097  

Less: Amount related to interest

    (68,091 )
       

  $ 143,006  
       

        Net assets held under capital leases are included in net real estate investments on our Consolidated Balance Sheets and totaled $224.7 million and $0 as of December 31, 2011 and 2010, respectively.

Unamortized Fair Value Adjustment

        As of December 31, 2011, the unamortized fair value adjustment related to the long-term debt we assumed in connection with various acquisitions was $144.9 million and will be recognized as effective yield adjustments over the remaining term of the instruments. The estimated aggregate amortization of the fair value adjustment related to long-term debt (reduction of interest expense) for each of the next five years is as follows: 2012—$54.0 million; 2013—$29.3 million; 2014—$23.3 million; 2015—$12.5 million; and 2016—$6.9 million.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 11—Fair Values of Financial Instruments

        As of December 31, 2011 and 2010, the carrying amounts and fair values of our financial instruments were as follows:

 
  2011   2010  
 
  Carrying
Amount
  Fair Value   Carrying
Amount
  Fair Value  
 
  (In thousands)
 

Assets:

                         

Cash and cash equivalents

  $ 45,807   $ 45,807   $ 21,812   $ 21,812  

Secured loans receivable, net

    212,577     216,315     149,263     155,377  

Derivative instruments

    11     11     99     99  

Marketable debt securities

    43,331     43,331     66,675     66,675  

Unsecured loans receivable, net

    63,598     65,219          

Liabilities:

                         

Senior notes payable and other debt, gross

    6,180,443     6,637,691     2,926,954     3,055,435  

Derivative instruments and other liabilities

    80,815     80,815     3,722     3,722  

Redeemable OP unitholder interests

   
102,837
   
102,837
   
   
 

        Fair value estimates are subjective in nature and depend upon several important assumptions, including estimates of future cash flows, risks, discount rates and relevant comparable market information associated with each financial instrument. The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the estimates presented above are not necessarily indicative of the amounts we would realize in a current market exchange.

        At December 31, 2011, we held corporate marketable debt securities, classified as available-for-sale and included within other assets on our Consolidated Balance Sheets, having an aggregate amortized cost basis and fair value of $41.2 million and $43.3 million, respectively. At December 31, 2010, our marketable debt securities had an aggregate amortized cost basis and fair value of $61.9 million and $66.7 million, respectively. The contractual maturities of our current marketable debt securities range from October 1, 2012 to April 15, 2016. During 2011, we sold certain marketable debt securities for $23.1 million in proceeds and recognized aggregate gains from these sales of approximately $1.8 million (included in income from loans and investments in our Consolidated Statements of Income).

Note 12—Stock-Based Compensation

Compensation Plans

        We have: four plans under which outstanding options to purchase common stock and/or shares or units of restricted stock have been, or may be, granted to officers, employees and non-employee directors (the 2000 Incentive Compensation Plan (Employee Plan), the 2004 Stock Plan for Directors, the 2006 Incentive Plan, and the 2006 Stock Plan for Directors); one plan under which executive officers may receive common stock in lieu of compensation (the Executive Deferred Stock Compensation Plan); and two plans under which certain directors have received or may receive common stock in lieu of director fees (the Common Stock Purchase Plan for Directors (the "Directors Stock Purchase Plan") and the Nonemployee Directors' Deferred Stock Compensation Plan). These plans are referred to collectively as the "Plans."

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 12—Stock-Based Compensation (Continued)

        During the year ended December 31, 2011, we were permitted to make option, restricted stock and restricted stock unit grants and stock issuances only under the Executive Deferred Stock Compensation Plan, the Nonemployee Directors' Deferred Stock Compensation Plan, the 2006 Incentive Plan and the 2006 Stock Plan for Directors.

        The number of shares initially reserved for issuance and the number of shares available for future grants or issuance under these Plans as of December 31, 2011 were as follows:

        Under the Plans that provide for the issuance of stock options, outstanding options are exercisable at the market price on the date of grant, expire ten years from the date of grant, and vest over periods of two or three years. Vesting of certain options may accelerate upon a change of control of Ventas, as defined in the applicable Plan, and other specified events.

        In connection with the NHP acquisition, we assumed certain outstanding options, shares of restricted stock and restricted stock units previously issued to NHP employees pursuant to the Nationwide Health Properties, Inc. 2005 Performance Incentive Plan, as amended (the "NHP Plan"). The outstanding awards continue to be subject to the terms and conditions of the NHP Plan and the applicable award agreements.

Stock Options

        In determining the estimated fair value of our stock options as of the date of grant, we used the Black-Scholes option pricing model with the following assumptions:

 
  2011   2010   2009  

Risk-free interest rate

    1.22 - 2.78 %   2.00 - 3.45 %   1.37 - 2.32 %

Dividend yield

    6.75 %   6.75 %   5.75 %

Volatility factors of the expected market price for our common stock

    35.7 - 44.3 %   37.1 - 44.6 %   36.1 - 42.7 %

Weighted average expected life of options

    4.25 - 7.0 years     4.25 - 7.0 years     3.5 - 6.0 years  

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 12—Stock-Based Compensation (Continued)

        The following is a summary of stock option activity in 2011:

Activity
  Shares   Range of Exercise
Prices
  Weighted Average
Exercise Price
  Weighted
Average
Remaining
Contractual
Life (years)
  Intrinsic
Value
($000's)
 

Outstanding as of December 31, 2010

    1,656,558   $ 11.34 - $45.26   $ 38.12              

Options granted

    376,451     52.48 -  57.19     53.64              

Options assumed from NHP

    108,785     48.60 -  48.60     48.60              

Options exercised

    (94,789 )   11.34 -  48.60     26.00              

Options canceled

                         
                               

Outstanding as of December 31, 2011

    2,047,005     11.45 -  57.19     42.10     6.9   $ 26,734  
                           

Exercisable as of December 31, 2011

    1,685,965   $ 11.45 - $57.19   $ 40.22     6.5   $ 25,158  
                           

        Compensation costs for all share-based awards are based on the grant date fair value and are recognized on a straight-line basis during the requisite service periods. Compensation costs related to stock options for the years ended December 31, 2011, 2010 and 2009 were $4.2 million, $3.1 million and $2.9 million, respectively.

        A summary of the status of our nonvested stock options as of December 31, 2011 and changes during the year then ended follows:

Activity
  Shares   Weighted Average
Grant Date Fair
Value
 

Nonvested at beginning of year

    340,203   $ 8.33  

Granted

    376,451     11.17  

Assumed from NHP

    108,785     9.93  

Vested

    (464,399 )   9.12  

Forfeited

         
             

Nonvested at end of year

    361,040   $ 10.76  
             

        As of December 31, 2011, we had $1.3 million of total unrecognized compensation cost related to nonvested stock options granted under the Plans and $0.1 million in total unrecognized compensation cost related to nonvested options assumed in the NHP acquisition. We expect to recognize that cost over a weighted average period of one year. Proceeds received from options exercised under the Plans for the years ended December 31, 2011, 2010 and 2009 were $2.5 million, $10.9 million and $2.2 million, respectively.

Restricted Stock and Restricted Stock Units

        We recognize the market value of shares of restricted stock and restricted stock units on the date of the award as stock-based compensation expense over the service period, with charges to general and administrative expenses of approximately $15.1 million in 2011, $11.0 million in 2010 and $9.0 million in 2009. Restricted stock and restricted stock units generally vest over periods ranging from two to five years. The vesting of restricted stock and restricted stock units may accelerate upon a change of control of Ventas, as defined in the applicable Plan, and other specified events.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 12—Stock-Based Compensation (Continued)

        A summary of the status of our nonvested restricted stock and restricted stock units as of December 31, 2011, and changes during the year ended December 31, 2011 follows:

 
  Restricted
Stock
  Weighted
Average
Grant Date
Fair Value
  Restricted
Stock Units
  Weighted
Average
Grant Date
Fair Value
 

Nonvested at December 31, 2010

    493,967   $ 43.10     4,690   $ 39.28  

Granted

    393,764     53.33     2,050     52.48  

Assumed from NHP

    1,337     53.74     41,495     53.74  

Vested

    (281,090 )   42.29     (14,946 )   50.08  

Forfeited

    (15,780 )   51.22          
                       

Nonvested at December 31, 2011

    592,198   $ 50.09     33,289   $ 53.27  
                       

        As of December 31, 2011, we had $19.5 million of unrecognized compensation cost related to nonvested restricted stock and restricted stock units under the Plans and $0.3 million of unrecognized compensation cost related to nonvested restricted stock and restricted stock units assumed in the NHP acquistion. We expect to recognize that cost over a weighted average period of 3.1 years.

Employee and Director Stock Purchase Plan

        We have in effect an Employee and Director Stock Purchase Plan ("ESPP") under which our employees and directors may purchase shares of our common stock at a discount. Pursuant to the terms of the ESPP, on each purchase date, participants may purchase shares of common stock at a price not less than 90% of the market price on that date (with respect to the employee tax-favored portion of the plan) and not less than 95% of the market price on that date (with respect to the additional employee and director portion of the plan). We initially reserved 2,500,000 shares for issuance under the ESPP. As of December 31, 2011, 44,238 shares had been purchased under the ESPP and 2,455,762 shares were available for future issuance.

Employee Benefit Plan

        We maintain a 401(K) plan that allows eligible employees to defer compensation subject to certain limitations imposed by the Code. In 2011, 2010 and 2009, we made contributions for each qualifying employee of up to 3% of his or her salary, subject to certain limitations, regardless of the employee's individual contribution. During 2011, 2010 and 2009, our aggregate contributions were approximately $267,000, $200,000 and $189,000, respectively.

Note 13—Income Taxes

        We have elected to be taxed as a REIT under the Code commencing with the year ended December 31, 1999. We have also elected for certain of our subsidiaries to be treated as taxable REIT subsidiaries ("TRS" or "TRS entities"), which are subject to federal and state income taxes. All entities other than the TRS entities are collectively referred to as "the REIT" within this Note 13.

        Although we intend to continue to operate in such a manner as to enable us to qualify as a REIT, our actual qualification and taxation as a REIT depends upon our ability to meet, on a continuing basis, distribution levels, stock ownership and various qualification tests. During the years ended

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 13—Income Taxes (Continued)

December 31, 2011, 2010 and 2009, our tax treatment of distributions per common share was as follows:

 
  2011   2010   2009  

Tax treatment of distributions:

                   

Ordinary income

  $ 2.28131   $ 1.99928   $ 1.8356  

Long-term capital gain

    0.01869     0.07644     0.1510  

Unrecaptured Section 1250 gain

        0.06428     0.0634  
               

Distribution reported for 1099-DIV purposes

    2.30000     2.14000     2.0500  

Less: Dividend declared in prior year and taxable in current year

             
               

Distributions declared per common share outstanding

  $ 2.30000   $ 2.14000   $ 2.0500  
               

        We believe we have met the annual REIT distribution requirement by payment of at least 90% of our estimated taxable income for 2011, 2010 and 2009. Our consolidated provision (benefit) for income taxes for the years ended December 31, 2011, 2010 and 2009 was as follows:

 
  2011   2010   2009  
 
  (In thousands)
 

Current

  $ (4,080 ) $ 2,459   $ 2,166  

Deferred

    (27,057 )   2,742     (3,885 )
               

Total

  $ (31,137 ) $ 5,201   $ (1,719 )
               

        The benefit for the year ended December 31, 2011 primarily relates to the reversal of certain income tax contingency reserves, including interest, and the deferred tax liabilities established for the ASLG acquisition. The statute of limitations with respect to our 2007 U.S. federal income tax returns expired in September 2011. We did not recognize any income tax expense as a result of the litigation proceeds that we received in the third and fourth quarters of 2011, as no income taxes are payable on these proceeds.

        The deferred tax expense/benefit for the years ended December 31, 2011, 2010 and 2009 was adjusted by income tax expense of $0 million, $2.3 million and $1.7 million, respectively, related to the noncontrolling interest share of net income. For the tax year ended December 31, 2011, the Canadian income tax expense included in the consolidated benefit for income taxes was $0.5 million. For the tax years ended December 31, 2010 and 2009, the Canadian income tax benefit included in the consolidated benefit for income taxes was $0.3 million and $2.0 million, respectively.

        Although the TRS entities were not liable for any cash federal income taxes for the year ended December 31, 2011, their federal income tax liabilities may increase in future years as we exhaust net operating loss carryforwards and as our senior living operations and MOB operations reportable segments grow. Such increases could be significant.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 13—Income Taxes (Continued)

        A reconciliation of income tax expense, which is computed by applying the federal corporate tax rate for the years ended December 31, 2011, 2010 and 2009, to the income tax benefit is as follows:

 
  2011   2010   2009  
 
  (In thousands)
 

Tax at statutory rate on earnings from continuing operations before unconsolidated entities, noncontrolling interest and income taxes

  $ 115,673   $ 78,663   $ 67,049  

State income taxes, net of federal benefit

    (2,396 )   700     (126 )

Increase in valuation allowance

    9,408     5,705     7,713  

(Decrease) increase in ASC 740 income tax liability

    (4,084 )   2,420     2,166  

Tax at statutory rate on earnings not subject to federal income taxes

    (151,429 )   (82,490 )   (78,176 )

Other differences

    1,691     203     (345 )
               

Income tax (benefit) expense

  $ (31,137 ) $ 5,201   $ (1,719 )
               

        The REIT made no income tax payments for the years ended December 31, 2011, 2010 and 2009.

        In connection with the Sunrise REIT and ASLG acquisitions, we established a beginning net deferred tax liability of $306.3 million and $44.6 million, respectively, related to temporary differences between the financial reporting and tax bases of assets and liabilities acquired (primarily property, intangible and related assets, net of net operating loss carryforwards). No net deferred tax asset or liability was recorded for the Lillibridge acquisition.

        Each TRS is a tax paying component for purposes of classifying deferred tax assets and liabilities. The tax effects of temporary differences and carryforwards included in the net deferred tax liabilities at December 31, 2011, 2010 and 2009 are summarized as follows:

 
  2011   2010   2009  
 
  (In thousands)
 

Property, primarily differences in depreciation and amortization, the tax basis of land assets and the treatment of interests and certain costs

  $ (332,111 ) $ (287,165 ) $ (293,800 )

Operating loss and interest deduction carryforwards

    343,843     103,733     86,014  

Expense accruals and other

    11,511     3,093     (58 )

Valuation allowance

    (281,954 )   (60,994 )   (45,821 )
               

Net deferred tax liabilities(1)

  $ (258,711 ) $ (241,333 ) $ (253,665 )
               

(1)
2011 includes approximately $2 million of deferred tax assets included in other assets on our Consolidated Balance Sheets.

        Our net deferred tax liability increased $17.4 million during 2011 due primarily to the initial deferred tax liability related to the ASLG acquisition. Our net deferred tax liability decreased $12.3 million during 2010 due primarily to the purchase of Sunrise's noncontrolling interests in 58 of our seniors housing communities. See "Note 4—Acquisitions of Real Estate Property."

        Due to our uncertainty regarding the realization of certain deferred tax assets, we have established valuation allowances, the majority of which relate to the net operating loss ("NOL") carryforward related to the REIT.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 13—Income Taxes (Continued)

        We are subject to corporate level taxes for any asset dispositions during the ten-year period immediately after the assets were owned by a C corporation (either prior to our REIT election, through stock acquisition or merger) ("built-in gains tax"). The amount of income potentially subject to built-in gains tax is generally equal to the lesser of the excess of the fair value of the asset over its adjusted tax basis as of the date it became a REIT asset or the actual amount of gain. Some, but not all, future gains could be offset by available NOLs.

        Generally, we are subject to audit under the statute of limitations by the Internal Revenue Service ("IRS") for the year ended December 31, 2008 and subsequent years and are subject to audit by state taxing authorities for the year ended December 31, 2007 and subsequent years. We are also subject to audit by the Canada Revenue Agency ("CRA") and provincial authorities generally for periods subsequent to 2006 related to entities acquired or formed in connection with our Sunrise REIT acquisition.

        At December 31, 2011, we had a combined NOL carryforward of $240 million related to the TRS entities and an NOL carryforward related to the REIT of $690 million (including carryforwards related to Lillibridge entities of $10.4 million and $16.2 million, respectively). The REIT NOL carryforward increased from 2010 by $38.7 million and $543.8 million due to the NHP and ASLG acquisitions, respectively. These amounts can be used to offset future taxable income (and/or taxable income for prior years if an audit determines that tax is owed), if any. The REIT will be entitled to utilize NOLs and tax credit carryforwards only to the extent that REIT taxable income exceeds our deduction for dividends paid. Lillibridge and ASLG NOL carryforwards are limited as to their utilization by Section 382 of the Code. The NOL carryforwards begin to expire in 2024 with respect to the TRS entities and in 2016 for the REIT.

        As a result of our uncertainty regarding the use of existing REIT NOLs, we have not ascribed any net deferred tax benefit to REIT NOL carryforwards as of December 31, 2011 and 2010. The IRS may challenge our entitlement to these tax attributes during its review of the tax returns for the previous tax years. We believe we are entitled to these tax attributes, but we cannot provide any assurance as to the outcome of these matters.

        The following table summarizes the activity related to our unrecognized tax benefits:

 
  2011   2010  
 
  (In thousands)
 

Balance as of January 1

  $ 17,868   $ 15,444  

Additions to tax positions related to the current year

    2,961     2,424  

Additions to tax positions related to prior years

    490      

Subtractions to tax positions related to prior years

    (6,425 )    
           

Balance as of December 31

  $ 14,894   $ 17,868  
           

        Included in the unrecognized tax benefits of $14.9 million and $17.9 million at December 31, 2011 and 2010, respectively, was $14.6 million and $17.3 million of tax benefits that, if recognized, would reduce our annual effective tax rate. We accrued no penalties. Interest of $0.5 million related to the unrecognized tax benefits was accrued during 2011. We expect our unrecognized tax benefits to increase by $3 million during 2012.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 14—Commitments and Contingencies

Certain Obligations, Liabilities and Litigation

        We may be subject to various obligations, liabilities and litigation assumed in connection with or arising out of our acquisitions or otherwise arising in connection with our business. Some of these liabilities may be indemnified by third parties. However, if these liabilities are greater than expected or were not known to us at the time of acquisition, if we are not entitled to indemnification, or if the responsible third party fails to indemnify us for these liabilities, such obligations, liabilities and litigation could have a Material Adverse Effect on us. In addition, in connection with the sale or leasing of our properties, we may incur various obligations and liabilities, including indemnification obligations, relating to the operations of those properties, which could have a Material Adverse Effect on us.

Other

        We are subject to certain operating and ground lease obligations that generally require fixed monthly or annual rent payments and may also include escalation clauses and renewal options. These leases have terms that expire during the next 89 years, excluding extension options. Our future minimum lease obligations under non-cancelable operating and ground leases as of December 31, 2011 were $17.6 million in 2012, $16.5 million in 2013, $15.8 million in 2014, $14.0 million in 2015, $13.9 million in 2016, and $322.5 million thereafter.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 15—Earnings Per Share

        The following table shows the amounts used in computing our basic and diluted earnings per common share:

 
  For the Year Ended December 31,  
 
  2011   2010   2009  
 
  (In thousands, except per share amounts)
 

Numerator for basic and diluted earnings per share:

                   

Income from continuing operations attributable to common stockholders

  $ 362,810   $ 215,324   $ 190,423  

Discontinued operations

    1,683     30,843     76,072  
               

Net income attributable to common stockholders

  $ 364,493   $ 246,167   $ 266,495  
               

Denominator:

                   

Denominator for basic earnings per share—weighted average shares

    228,453     156,608     152,566  

Effect of dilutive securities:

                   

Stock options

    449     407     126  

Restricted stock awards

    53     70     64  

OP units

    942          

Convertible notes

    893     572     2  
               

Denominator for diluted earnings per share—adjusted weighted average shares

    230,790     157,657     152,758  
               

Basic earnings per share:

                   

Income from continuing operations attributable to common stockholders

  $ 1.59   $ 1.37   $ 1.25  

Discontinued operations

    0.01     0.20     0.50  
               

Net income attributable to common stockholders

  $ 1.60   $ 1.57   $ 1.75  
               

Diluted earnings per share:

                   

Income from continuing operations attributable to common stockholders

  $ 1.57   $ 1.36   $ 1.24  

Discontinued operations

    0.01     0.20   $ 0.50  
               

Net income attributable to common stockholders

  $ 1.58   $ 1.56   $ 1.74  
               

        There were 309,650, 0 and 975,500 anti-dilutive options outstanding for the years ended December 31, 2011, 2010 and 2009, respectively.

Note 16—Litigation

Litigation Relating to the Sunrise REIT Acquisition

        On May 3, 2007, we filed a lawsuit against HCP, Inc. ("HCP") in the United States District Court for the Western District of Kentucky (the "District Court"), entitled Ventas, Inc. v. HCP, Inc., Case No. 07-cv-238-JGH. We asserted claims of tortious interference with contract and tortious interference with prospective business advantage. Our complaint alleged that HCP interfered with our purchase agreement to acquire the assets and liabilities of Sunrise REIT and with the process for unitholder

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consideration of the purchase agreement. The complaint alleged, among other things, that HCP made certain improper and misleading public statements and/or offers to acquire Sunrise REIT and that HCP's actions caused us to suffer substantial damages, including, among other things, the payment of materially greater consideration to acquire Sunrise REIT resulting from the substantial increase in the purchase price above the original contract price necessary to obtain unitholder approval and increased costs associated with the delay in closing the acquisition, including increased costs to finance the transaction as a result of the delay.

        HCP brought counterclaims against us alleging misrepresentation and negligent misrepresentation by Sunrise REIT related to its sale process, claiming that we were responsible for those actions as successor. HCP sought compensatory and punitive damages. On March 25, 2009, the District Court granted us judgment on the pleadings against all counterclaims brought by HCP and dismissed HCP's counterclaims with prejudice.

        On July 16, 2009, the District Court denied HCP's summary judgment motion as to our claim for tortious interference with business advantage, permitting us to present that claim against HCP at trial. The District Court granted HCP's motion for summary judgment as to our claim for tortious interference with contract and dismissed that claim. The District Court also ruled that we could not seek to recover a portion of our alleged damages.

        On September 4, 2009, the jury unanimously held that HCP tortiously interfered with our business expectation to acquire Sunrise REIT at the agreed price by employing significantly wrongful means such as fraudulent misrepresentation, deceit and coercion. The jury awarded us $101.6 million in compensatory damages, which is the full amount of damages the District Court permitted us to seek at trial. The District Court entered judgment on the jury's verdict on September 8, 2009.

        On November 17, 2009, HCP appealed the District Court's judgment to the United States Court of Appeals for the Sixth Circuit (the "Sixth Circuit"). HCP argued that the judgment against it should be vacated and the case remanded for a new trial and/or that judgment should be entered in its favor as a matter of law. On November 24, 2009, we filed a cross-appeal to the Sixth Circuit.

        On May 17, 2011, the Sixth Circuit unanimously affirmed the $101.6 million jury verdict in our favor and ruled that we were entitled to seek punitive damages against HCP for its intentionally wrongful conduct. The Sixth Circuit also denied our appeal seeking additional compensatory damages and pre-judgment interest.

        On July 5, 2011, the Sixth Circuit issued a mandate terminating the appellate proceedings and transferring jurisdiction back to the District Court for the enforcement of the $101.6 million compensatory damages award and the trial for punitive damages.

        On August 23, 2011, HCP paid us $102.8 million for the judgment plus certain costs and interest.

        On November 9, 2011, HCP paid us an additional $125.0 million in final settlement of our outstanding litigation against HCP. As part of the settlement, both parties agreed to dismissals of their cases, appeals and petitions, and all aspects of the litigation were terminated.

        After certain fees and expenses, the contingent fee for our outside legal counsel and donations to the Ventas Charitable Foundation, we recognized approximately $202.3 million in net proceeds from the compensatory damages award and the final settlement in our Consolidated Statements of Income.

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Litigation Relating to the NHP Acquisition

        In the weeks following the announcement of our acquisition of NHP on February 28, 2011, purported stockholders of NHP filed seven lawsuits against NHP and its directors. Six of these lawsuits also named Ventas, Inc. as a defendant and five named our subsidiary, Needles Acquisition LLC, as a defendant. The purported stockholder plaintiffs commenced these actions in two jurisdictions: the Superior Court of the State of California, Orange County (the "California State Court"); and the Circuit Court for Baltimore City, Maryland (the "Maryland State Court"). All of these actions were brought as putative class actions, and two also purport to assert derivative claims on behalf of NHP. All of these stockholder complaints allege that NHP's directors breached certain alleged duties to NHP's stockholders by approving the merger agreement with us, and certain complaints allege that NHP aided and abetted those breaches. Those complaints that name Ventas, Inc. and Needles Acquisition LLC allege that we aided and abetted the purported breaches of certain alleged duties by NHP's directors. All of the complaints request an injunction of the merger. Certain of the complaints also seek damages.

        In the California State Court, the following actions were filed purportedly on behalf of NHP stockholders: on February 28, 2011, a putative class action entitled Palma v. Nationwide Health Properties, Inc., et al.; on March 3, 2011, a putative class action entitled Barker v. Nationwide Health Properties, Inc., et al.; and on March 3, 2011, a putative class action entitled Davis v. Nationwide Health Properties, Inc., et al., which was subsequently amended on March 11, 2011 under the caption Davids v. Nationwide Health Properties, Inc., et al. Each action names NHP and members of the NHP board of directors as defendants. The Barker and Davids actions also name Ventas, Inc. as a defendant, and the Davids action names Needles Acquisition LLC as a defendant. Each complaint alleges, among other things, that NHP's directors breached certain alleged duties by approving the merger agreement between us and NHP because the proposed transaction purportedly fails to maximize stockholder value and provides the directors personal benefits not shared by NHP stockholders, and the Barker and Davids actions allege that we aided and abetted those purported breaches. Along with other relief, the complaints seek an injunction against the closing of the proposed merger. On April 4, 2011, the defendants demurred and moved to stay the Palma, Barker, and Davids actions in favor of the parallel litigation in the Maryland State Court described below. On April 27, 2011, all three actions were consolidated pursuant to a Stipulation and Proposed Order on Consolidation of Related Actions signed by the parties on March 22, 2011. On May 12, 2011, the California State Court granted the defendants' motion to stay.

        In the Maryland State Court, the following actions were filed purportedly on behalf of NHP stockholders: on March 7, 2011, a putative class action entitled Crowley v. Nationwide Health Properties, Inc., et al.; on March 10, 2011, a putative class action entitled Taylor v. Nationwide Health Properties, Inc., et. al.; on March 17, 2011, a putative class action entitled Haughey Family Trust v. Pasquale, et al.; and on March 31, 2011, a putative class action entitled Rappoport v. Pasquale, et al. All four actions name NHP, its directors, Ventas, Inc. and Needles Acquisition LLC as defendants. All four actions allege, among other things, that NHP's directors breached certain alleged duties by approving the merger agreement between us and NHP because the proposed transaction purportedly fails to maximize stockholder value and provides certain directors personal benefits not shared by NHP stockholders and that we aided and abetted those purported breaches. In addition to asserting direct claims on behalf of a putative class of NHP shareholders, the Haughey and Rappoport actions purport to bring derivative claims on behalf of NHP, asserting breaches of certain alleged duties by NHP's directors in connection with their approval of the proposed transaction. All four actions seek to enjoin the proposed merger, and the Taylor action seeks damages.

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        On March 30, 2011, pursuant to stipulation of the parties, the Maryland State Court entered an order consolidating the Crowley, Taylor and Haughey actions. The Rappoport action was consolidated with the other actions on April 15, 2011.

        On April 1, 2011, pursuant to stipulation of the parties, the Maryland State Court entered an order: (i) certifying a class of NHP shareholders; and (ii) providing for the plaintiffs to file a consolidated amended complaint. The plaintiffs filed a consolidated amended complaint on April 19, 2011, which the defendants moved to dismiss on April 29, 2011. Plaintiffs opposed that motion on May 9, 2011. Plaintiffs moved for expedited discovery on April 19, 2011, and the defendants simultaneously opposed that motion and moved for a protective order staying discovery on April 26, 2011. The Maryland State Court denied plaintiffs' motion for expedited discovery and granted defendants' motion for a protective order on May 3, 2011. On May 6, 2011, plaintiffs moved for reconsideration of the Maryland State Court's grant of the protective order. The Maryland State Court denied the plaintiffs' motion for reconsideration on May 11, 2011. On May 27, 2011, the Maryland State Court entered an order dismissing the consolidated action with prejudice. Plaintiffs moved for reconsideration of that order on June 6, 2011.

        On June 9, 2011, we and NHP agreed on a settlement in principle with the plaintiffs in the consolidated action pending in Maryland State Court, which required us and NHP to make certain supplemental disclosures to stockholders concerning the merger. We and NHP made the supplemental disclosures on June 10, 2011. The settlement is subject to appropriate documentation by the parties and approval by the Maryland State Court.

        We believe that each of these actions is without merit.

Litigation Relating to the Cogdell Acquisition

        In the weeks following the announcement of our acquisition of Cogdell on December 27, 2011, purported stockholders of Cogdell filed seven lawsuits against Cogdell and its directors. Each of these lawsuits also named Ventas, Inc. as a defendant, and certain of the lawsuits also named our subsidiaries, TH Merger Corp, Inc. and TH Merger Sub, LLC, as defendants. Plaintiffs commenced these actions in two jurisdictions: the Superior Court of the State of North Carolina, Mecklenburg County; and the Circuit Court for Baltimore City, Maryland.

        Each of these actions was brought as a putative class action and alleges that Cogdell's directors breached their fiduciary duties to Cogdell's stockholders by approving the merger agreement with us. The complaints also allege that Ventas, Inc. and, in some cases, Cogdell, TH Merger Corp, Inc. and TH Merger Sub, LLC aided and abetted those purported breaches. All of the complaints request an injunction of the merger, declaratory relief, attorneys' fees and costs, and other unspecified monetary relief.

        We believe that each of these actions is without merit, and the plaintiffs' claims are being vigorously contested.

Proceedings against Tenants, Operators and Managers

        From time to time, Kindred, Brookdale Senior Living, Sunrise, Atria and our other tenants, operators and managers are parties to certain legal actions, regulatory investigations and claims arising in the conduct of their business and operations. Even though we generally are not party to these proceedings, the unfavorable resolution of any such actions, investigations or claims could, individually

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or in the aggregate, materially adversely affect such tenants', operators' or managers' liquidity, financial condition or results of operations and their ability to satisfy their respective obligations to us, which, in turn, could have a Material Adverse Effect on us.

Proceedings Indemnified and Defended by Third Parties

        From time to time, we are party to certain legal actions, regulatory investigations and claims for which third parties are contractually obligated to indemnify, defend and hold us harmless. The tenants of our triple-net leased properties and, in some cases, their affiliates are required by the terms of their leases and other agreements with us to indemnify, defend and hold us harmless against certain actions, investigations and claims arising in the course of their business and related to the operations of our triple-net leased properties. In addition, third parties from whom we acquired certain of our assets are required by the terms of the related conveyance documents to indemnify, defend and hold us harmless against certain actions, investigations and claims related to the conveyed assets and arising prior to our ownership. In some cases, we hold a portion of the purchase price consideration in escrow as collateral for these indemnification obligations. We are presently being defended by certain tenants and other obligated third parties in these types of matters. We cannot provide any assurance that our tenants, their affiliates or other obligated third parties will continue to defend us in these matters, that our tenants, their affiliates or other obligated third parties will have sufficient assets, income and access to financing to enable them to satisfy their defense and indemnification obligations to us or that any purchase price consideration held in escrow will be sufficient to satisfy claims for which we are entitled to indemnification. The unfavorable resolution of any such actions, investigations or claims could, individually or in the aggregate, materially adversely affect our tenants' or other obligated third parties' liquidity, financial condition or results of operations and their ability to satisfy their respective obligations to us, which, in turn, could have a Material Adverse Effect on us.

Proceedings Arising in Connection with Senior Living and MOB Operations; Other Litigation

        From time to time, we are party to various legal actions, regulatory investigations and claims (some of which may not be insured) arising in connection with our senior living and MOB operations or otherwise in the course of our business. In limited circumstances, the manager of the applicable seniors housing community or MOB may be contractually obligated to indemnify, defend and hold us harmless against such actions, investigations and claims. It is the opinion of management that, except as otherwise set forth in this Note 16, the disposition of any such actions, investigations and claims that are currently pending will not, individually or in the aggregate, have a Material Adverse Effect on us. However, regardless of their merits, these matters may force us to expend significant financial resources. We are unable to predict the ultimate outcome of these actions, investigations and claims, and if management's assessment of our liability with respect thereto is incorrect, such actions, investigations and claims could have a Material Adverse Effect on us.

Note 17—Capital Stock

        On November 15, 2011, we issued an aggregate of 943,714 shares of our common stock in settlement of the conversion value in excess of the $230.0 million principal amount outstanding of our 37/8% convertible senior notes due 2011upon maturity.

        On July 1, 2011, following approval by our stockholders, we amended our Amended and Restated Certificate of Incorporation, as previously amended ("Charter"), to increase the number of authorized

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shares of our capital stock to 610,000,000, comprised of 600,000,000 shares of common stock, par value $0.25 per share, and 10,000,000 shares of preferred stock, par value $1.00 per share.

        On July 1, 2011, in connection with the NHP acquisition, we issued 99,849,106 shares of our common stock to NHP stockholders and holders of NHP equity awards (which shares had a total value of $5.4 billion based on the July 1, 2011 closing price of our common stock of $53.74 per share). We reserved 2,253,366 additional shares of our common stock for issuance in connection with equity awards and other convertible or exchangeable securities (specifically the OP Units) that we assumed in connection with the NHP acquisition.

        On May 12, 2011, as partial consideration for the ASLG acquisition, we issued to the sellers in a private placement an aggregate of 24,958,543 shares of our common stock (which shares had a total value of $1.38 billion based on the May 12, 2011 closing price of our common stock of $55.33 per share). On November 2, 2011, we cancelled 83,441 shares issued to the sellers for a working capital adjustment in accordance with the purchase agreement.

        In February 2011, we completed the sale of 5,563,000 shares of our common stock in an underwritten public offering pursuant to our existing shelf registration statement. We received $300.0 million in aggregate proceeds from the sale, which we used to repay existing mortgage debt and for working capital and other general corporate purposes.

Excess Share Provision

        In order to preserve our ability to maintain REIT status, our Charter provides that if a person acquires beneficial ownership of more than 9% of our outstanding common stock or 9.9% of our outstanding preferred stock, the shares that are beneficially owned in excess of such limit are deemed to be excess shares. These shares are automatically deemed transferred to a trust for the benefit of a charitable institution or other qualifying organization selected by our Board of Directors. The trust is entitled to all dividends with respect to the shares and the trustee may exercise all voting power over the shares.

        We have the right to buy the excess shares for a purchase price equal to the lesser of the price per share in the transaction that created the excess shares or the market price on the date we buy the shares, and we may defer payment of the purchase price for the excess shares for up to five years. If we do not purchase the excess shares, the trustee of the trust is required to transfer the excess shares at the direction of the Board of Directors. The owner of the excess shares is entitled to receive the lesser of the proceeds from the sale or the original purchase price for such excess shares, and any additional amounts are payable to the beneficiary of the trust.

        Our Board of Directors is empowered to grant waivers from the excess share provisions of our Charter.

Distribution Reinvestment and Stock Purchase Plan

        Under our Distribution Reinvestment and Stock Purchase Plan ("DRIP"), existing stockholders may purchase shares of common stock by reinvesting all or a portion of the cash distribution on their shares of our common stock, subject to certain limits. Existing stockholders and new investors also may purchase shares of our common stock under the DRIP by making optional cash payments, subject to certain limits. We currently offer a 1% discount on the purchase price of our common stock to shareholders who reinvest their dividends and/or make optional cash purchases through the DRIP. The

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amount and availability of this discount is at our discretion. The granting of a discount for one month or quarter, as applicable, will not insure the availability or amount of a discount in future periods, and each month or quarter, as applicable, we may lower or eliminate the discount without prior notice. We may also, without prior notice, change our determination as to whether common shares will be purchased by the plan administrator directly from us or in the open market.

Accumulated Other Comprehensive Income

 
  As of December 31,  
 
  2011   2010  
 
  (In thousands)
 

Foreign currency translation

  $ 21,066   $ 23,010  

Unrealized gain on marketable debt securities

    2,103     4,794  

Other

    (1,107 )   (936 )
           

Total accumulated other comprehensive income

  $ 22,062   $ 26,868  
           

Note 18—Related Party Transactions

        In December 2011, we entered into a joint venture with Pacific Medical Buildings LLC to develop a new MOB to be located on the Sutter Medical Center—Castro Valley campus. Our 82.8% interest in the building will be subject to a ground lease from Sutter Health, and the MOB, when completed, is expected to be 100% leased by Sutter Health pursuant to long-term triple-net leases. Robert D. Reed, Senior Vice President and Chief Financial Officer of Sutter Health, has served as a member of our Board of Directors since March 2008.

        Upon consummation of the ASLG acquisition, we entered into long-term management agreements with Atria to operate the acquired assets. Atria is owned by private equity funds managed by Lazard Real Estate Partners LLC ("LREP"). Effective May 13, 2011, LREP Chief Executive Officer and Managing Principal and Atria Chairman Matthew J. Lustig was appointed to our Board of Directors pursuant to the terms of a Director Appointment Agreement between us and the sellers of the acquired assets. For the period from May 12, 2011 through December 31, 2011, we paid Atria $20.2 million in management fees.

        From time to time, we may engage Cushman & Wakefield, a global commercial real estate firm, to act as a leasing agent or broker with respect to certain of our properties. Cushman & Wakefield President and Chief Executive Officer Glenn J. Rufrano has served as a member of our Board of Directors since June 2010. We believe the fees we pay to Cushman & Wakefield in connection with the provision of these services are customary and represent market rates. Total fees we paid to Cushman & Wakefield during the year ended December 31, 2011 were de minimis.

        Effective upon consummation of the NHP acquisition, Richard I. Gilchrist, a former NHP director, was appointed to our Board of Directors. Mr. Gilchrist currently serves as Senior Advisor to The Irvine Company, and from 2006 until July 2011, he served as President of The Irvine Company's Investment Properties Group, from whom NHP leased its corporate headquarters prior to the acquisition. NHP LLC, the successor to NHP and our wholly owned subsidiary, continues to rent office space in the building owned by The Irvine Company. For the period from July 1, 2011 through December 31, 2011, we paid approximately $280,000 in rent to The Irvine Company.

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Note 18—Related Party Transactions (Continued)

        In connection with the closing of our Lillibridge acquisition, we entered into an Intellectual Property Rights Purchase and Sale Agreement with Todd W. Lillibridge, who became our Executive Vice President, Medical Property Operations. Under the agreement, we acquired Mr. Lillibridge's rights in and to the use of the Lillibridge name and the "LILLIBRIDGE" trademark, as well as certain derivative trademarks, design marks and slogans for an aggregate purchase price of $3.0 million, which was reported in the total purchase price for the acquisition. See "Note 4—Acquisitions of Real Estate Property."

        We lease eight personal care facilities to Tangram Rehabilitation Network, Inc. ("Tangram") pursuant to a master lease agreement that is guaranteed by its parent company, Res-Care, Inc. ("Res-Care"), of which Ronald G. Geary, a member of our Board of Directors, served as Chairman of the Board until December 2010. For each of the years ended December 31, 2010 and 2009, Tangram paid us approximately $1.0 million in base rent.

Note 19—Quarterly Financial Information (Unaudited)

        Summarized unaudited consolidated quarterly information for the years ended December 31, 2011 and 2010 is provided below.

 
  For the Year Ended December 31, 2011  
 
  First
Quarter
  Second
Quarter
  Third
Quarter
  Fourth
Quarter
 
 
  (In thousands, except per share amounts)
 

Revenues(1)

  $ 268,432   $ 362,630   $ 562,528   $ 571,401  
                   

Income from continuing operations attributable to common stockholders(1)

  $ 48,218   $ 18,906   $ 102,470   $ 193,216  

Discontinued operations(1)

    766     770     415     (268 )
                   

Net income attributable to common stockholders

  $ 48,984   $ 19,676   $ 102,885   $ 192,948  
                   

Earnings per share:

                         

Basic:

                         

Income from continuing operations attributable to common stockholders

  $ 0.30   $ 0.11   $ 0.36   $ 0.67  

Discontinued operations

    0.01     0.00     0.00     (0.00 )
                   

Net income attributable to common stockholders

  $ 0.31   $ 0.11   $ 0.36   $ 0.67  
                   

Diluted:

                         

Income from continuing operations attributable to common stockholders

  $ 0.30   $ 0.11   $ 0.35   $ 0.66  

Discontinued operations

    0.00     0.00     0.00     (0.00 )
                   

Net income attributable to common stockholders

  $ 0.30   $ 0.11   $ 0.35   $ 0.66  
                   

Dividends declared per share

  $ 0.575   $ 0.7014   $ 0.4486   $ 0.575  

(1)
The amounts presented for the three months ended March 31, 2011, June 30, 2011 and September 30, 2011 differ from the amounts previously reported in our Quarterly Reports on Form 10-Q as a result of discontinued operations consisting of properties sold in 2011 or held for sale as of December 31, 2011.

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Note 19—Quarterly Financial Information (Unaudited) (Continued)

 
  For the Three Months Ended  
 
  March 31,
2011
  June 30,
2011
  September 30,
2011
 
 
  (In thousands, except per share amounts)
 

Revenues, previously reported in Form 10-Q

  $ 270,461   $ 364,660   $ 565,957  

Revenues, previously reported in Form 10-Q, subsequently reclassified to discontinued operations

    (2,029 )   (2,030 )   (3,429 )
               

Total revenues disclosed in Form 10-K

  $ 268,432   $ 362,630   $ 562,528  
               

Income from continuing operations attributable to common stockholders, previously reported in Form 10-Q

  $ 48,984   $ 19,676   $ 102,885  

Income from continuing operations attributable to common stockholders, previously reported in Form 10-Q, subsequently reclassified to discontinued operations

    (766 )   (770 )   (415 )
               

Income from continuing operations attributable to common stockholders disclosed in Form 10-K

  $ 48,218   $ 18,906   $ 102,470  
               

Discontinued operations, previously reported in Form 10-Q

  $   $   $  

Discontinued operations from properties sold or held for sale subsequent to the respective reporting period

    766     770     415  
               

Discontinued operations disclosed in Form 10-K

  $ 766   $ 770   $ 415  
               

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Note 19—Quarterly Financial Information (Unaudited) (Continued)

 
  For the Year Ended December 31, 2010  
 
  First
Quarter
  Second
Quarter
  Third
Quarter
  Fourth
Quarter
 
 
  (In thousands, except per share amounts)
 

Revenues(1)

  $ 238,859   $ 241,291   $ 262,636   $ 265,965  
                   

Income from continuing operations attributable to common stockholders(1)

  $ 51,169   $ 51,451   $ 56,563   $ 56,141  

Discontinued operations(1)

    1,450     6,616     1,335     21,442  
                   

Net income attributable to common stockholders

  $ 52,619   $ 58,067   $ 57,898   $ 77,583  
                   

Earnings per share:

                         

Basic:

                         

Income from continuing operations attributable to common stockholders

  $ 0.33   $ 0.33   $ 0.36   $ 0.36  

Discontinued operations

    0.01     0.04     0.01     0.13  
                   

Net income attributable to common stockholders

  $ 0.34   $ 0.37   $ 0.37   $ 0.49  
                   

Diluted:

                         

Income from continuing operations attributable to common stockholders

  $ 0.33   $ 0.33   $ 0.36   $ 0.35  

Discontinued operations

    0.01     0.04     0.01     0.14  
                   

Net income attributable to common stockholders

  $ 0.34   $ 0.37   $ 0.37   $ 0.49  
                   

Dividends declared per share

  $ 0.535   $ 0.535   $ 0.535   $ 0.535  

(1)
The amounts presented for the three months ended March 31, 2010, June 30, 2010, September 30, 2010 and December 31, 2010 differ from the amounts previously reported in our Annual Report on Form 10-K as a result of discontinued operations consisting of properties sold in 2011 or held for sale as of December 31, 2011.

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Note 19—Quarterly Financial Information (Unaudited) (Continued)

 
  For the Three Months Ended  
 
  March 31,
2010
  June 30,
2010
  September 30,
2010
  December 31,
2010
 
 
  (In thousands, except per share amounts)
 

Revenues, previously reported in Form 10-K

  $ 240,888   $ 243,320   $ 264,665   $ 267,994  

Revenues, previously reported in Form 10-K, subsequently reclassified to discontinued operations

    (2,029 )   (2,029 )   (2,029 )   (2,029 )
                   

Total revenues disclosed in Form 10-K

  $ 238,859   $ 241,291   $ 262,636   $ 265,965  
                   

Income from continuing operations attributable to common stockholders, previously reported in Form 10-K

  $ 51,874   $ 52,215   $ 57,356   $ 56,925  

Income from continuing operations attributable to common stockholders, previously reported in Form 10-K, subsequently reclassified to discontinued operations

    (705 )   (764 )   (793 )   (784 )
                   

Income from continuing operations attributable to common stockholders disclosed in Form 10-K

  $ 51,169   $ 51,451   $ 56,563   $ 56,141  
                   

Discontinued operations, previously reported in Form 10-K

  $ 745   $ 5,852   $ 542   $ 20,658  

Discontinued operations from properties sold or held for sale subsequent to the respective reporting period

    705     764     793     784  
                   

Discontinued operations disclosed in Form 10-K

  $ 1,450   $ 6,616   $ 1,335   $ 21,442  
                   

Note 20—Segment Information

        As of December 31, 2011, we operated through three reportable business segments: triple-net leased properties, senior living operations and MOB operations. Our triple-net leased properties segment consists of acquiring and owning seniors housing and healthcare properties in the United States and leasing those properties to healthcare operating companies under "triple-net" or "absolute-net" leases, which require the tenants to pay all property-related expenses. Our senior living operations segment consists of investments in seniors housing communities located in the United States and Canada for which we engage independent third parties, such as Atria and Sunrise, to manage the operations. Our MOB operations segment primarily consists of acquiring, owning, developing, leasing and managing MOBs. Information provided for "all other" includes revenues such as income from loans and investments and other miscellaneous income and various corporate-level expenses not directly attributable to our three reportable business segments. Assets included in all other consist primarily of corporate assets, including cash, restricted cash, deferred financing costs, loans receivable and miscellaneous accounts receivable.

        With the addition of the Lillibridge businesses and properties in July 2010, we believed the segregation of our MOB operations into its own reporting segment would be useful in assessing the performance of this portion of our business in the same way that management intends to review our performance and make operating decisions. Prior to the Lillibridge acquisition, we operated through two reportable business segments: triple-net leased properties and senior living operations. Prior year

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Note 20—Segment Information (Continued)

amounts have been restated to reflect the segregation of our MOB operations into a reportable business segment.

        We evaluate performance of the combined properties in each reportable business segment based on segment profit, which we define as NOI adjusted for gain/loss from unconsolidated entities. We define NOI as total revenues, less interest and other income, property-level operating expenses and medical office building services costs. We believe that net income, as defined by GAAP, is the most appropriate earnings measurement. However, we believe that segment profit serves as a useful supplement to net income because it allows investors, analysts and our management to measure unlevered property-level operating results and to compare our operating results to the operating results of other real estate companies and between periods on a consistent basis. Segment profit should not be considered as an alternative to net income (determined in accordance with GAAP) as an indicator of our financial performance. In order to facilitate a clear understanding of our consolidated historical operating results, segment profit should be examined in conjunction with net income as presented in our Consolidated Financial Statements and data included elsewhere in this Annual Report on Form 10-K.

        Interest expense, depreciation and amortization, general, administrative and professional fees and non-property specific revenues and expenses are not allocated to individual segments for purposes of assessing segment performance. There are no intersegment sales or transfers.

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Note 20—Segment Information (Continued)

        Summary information by reportable business segment is as follows:

        For the year ended December 31, 2011:

 
  Triple-Net
Leased
Properties
  Senior
Living
Operations
  MOB
Operations
  All
Other
  Total  
 
  (In thousands)
 

Revenues:

                               

Rental income

  $ 652,577   $   $ 167,003   $   $ 819,580  

Resident fees and services

        873,308             873,308  

Medical office building and other services revenue

    2,217         34,254         36,471  

Income from loans and investments

                34,415     34,415  

Interest and other income

                1,217     1,217  
                       

Total revenues

  $ 654,794   $ 873,308   $ 201,257   $ 35,632   $ 1,764,991  
                       

Total revenues

  $ 654,794   $ 873,308   $ 201,257   $ 35,632   $ 1,764,991  

Less:

                               

Interest and other income

                1,217     1,217  

Property-level operating expenses

        593,977     57,584         651,561  

Medical office building services costs

            27,082         27,082  
                       

Segment NOI

    654,794     279,331     116,591     34,415     1,085,131  

Income (loss) from unconsolidated entities

    295         (347 )       (52 )
                       

Segment profit

  $ 655,089   $ 279,331   $ 116,244   $ 34,415     1,085,079  
                         

Interest and other income

                            1,217  

Interest expense

                            (236,807 )

Depreciation and amortization

                            (456,590 )

General, administrative and professional fees

                            (74,537 )

Loss on extinguishment of debt

                            (27,604 )

Litigation proceeds, net

                            202,259  

Merger-related expenses and deal costs

                            (153,923 )

Other

                            (8,653 )

Income tax benefit

                            31,137  

Discontinued operations

                            1,683  
                               

Net income

                          $ 363,261  
                               

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Note 20—Segment Information (Continued)

        For the year ended December 31, 2010:

 
  Triple-Net
Leased
Properties
  Senior
Living
Operations
  MOB
Operations
  All
Other
  Total  
 
  (In thousands)
 

Revenues:

                               

Rental income

  $ 461,709   $   $ 69,747   $   $ 531,456  

Resident fees and services

        446,301             446,301  

Medical office building and other services revenue

            14,098         14,098  

Income from loans and investments

                16,412     16,412  

Interest and other income

                484     484  
                       

Total revenues

  $ 461,709   $ 446,301   $ 83,845   $ 16,896   $ 1,008,751  
                       

Total revenues

  $ 461,709   $ 446,301   $ 83,845   $ 16,896   $ 1,008,751  

Less:

                               

Interest and other income

                484     484  

Property-level operating expenses

        291,831     24,122         315,953  

Medical office building services costs

            9,518         9,518  
                       

Segment NOI

    461,709     154,470     50,205     16,412     682,796  

Loss from unconsolidated entities

            (664 )       (664 )
                       

Segment profit

  $ 461,709   $ 154,470   $ 49,541   $ 16,412     682,132  
                         

Interest and other income

                            484  

Interest expense

                            (175,631 )

Depreciation and amortization

                            (203,762 )

General, administrative and professional fees

                            (49,830 )

Loss on extinguishment of debt

                            (9,791 )

Merger-related expenses and deal costs

                            (19,243 )

Other

                            (272 )

Income tax expense

                            (5,201 )

Discontinued operations

                            30,843  
                               

Net income

                          $ 249,729  
                               

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Note 20—Segment Information (Continued)

        For the year ended December 31, 2009:

 
  Triple-Net
Leased
Properties
  Senior
Living
Operations
  MOB
Operations
  All
Other
  Total  
 
  (In thousands)
 

Revenues:

                               

Rental income

  $ 452,536   $   $ 35,922   $   $ 488,458  

Resident fees and services

        421,058             421,058  

Income from loans and investments

                13,107     13,107  

Interest and other income

                842     842  
                       

Total revenues

  $ 452,536   $ 421,058   $ 35,922   $ 13,949   $ 923,465  
                       

Total revenues

  $ 452,536   $ 421,058   $ 35,922   $ 13,949   $ 923,465  

Less:

                               

Interest and other income

                842     842  

Property-level operating expenses

        290,045     12,768         302,813  
                       

Segment NOI

    452,536     131,013     23,154     13,107     619,810  

Income (loss) from unconsolidated entities

   
   
   
   
   
 
                       

Segment profit

  $ 452,536   $ 131,013   $ 23,154   $ 13,107     619,810  
                         

Interest and other income

                            842  

Interest expense

                            (173,810 )

Depreciation and amortization

                            (197,298 )

General, administrative and professional fees

                            (38,830 )

Loss on extinguishment of debt

                            (6,080 )

Merger-related expenses and deal costs

                            (13,015 )

Other

                            (50 )

Income tax benefit

                            1,719  

Discontinued operations

                            76,072  
                               

Net income

                          $ 269,360  
                               

        Assets by reportable business segment are as follows:

 
  As of December 31,  
 
  2011   2010  
 
  (In thousands)
 

Assets:

                         

Triple-net leased properties

  $ 8,704,061     50.4 % $ 2,474,612     43.0 %

Senior living operations

    5,758,497     33.3     2,297,041     39.9  

MOB operations

    2,433,160     14.1     748,945     13.0  

All other assets

    376,192     2.2     237,423     4.1  
                   

Total assets

  $ 17,271,910     100.0 % $ 5,758,021     100.0 %
                   

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 20—Segment Information (Continued)

        Capital expenditures, including investments in real estate property and development project expenditures, by reportable business segment are as follows:

 
  For the Year Ended December 31,  
 
  2011   2010   2009  
 
  (In thousands)
 

Capital expenditures:

                   

Triple-net leased properties(1)

  $ 133,761   $ 12,884   $ 10,867  

Senior living operations

    370,455     10,268     11,081  

MOB operations(2)

    125,453     271,144     105,880  
               

Total capital expenditures

  $ 629,669   $ 294,296   $ 127,828  
               

(1)
2009 includes $9.3 million from funds held in a Code Section 1031 exchange escrow account with a qualified intermediary.

(2)
2009 includes $55.7 million from funds held in a Code Section 1031 exchange escrow account with a qualified intermediary.

        Our portfolio of properties and mortgage loan and other investments are located in the United States and Canada. Revenues are attributed to an individual country based on the location of each property.

        Geographic information regarding our operations is as follows:

 
  For the Year Ended December 31,  
 
  2011   2010   2009  
 
  (In thousands)
 

Revenues:

                   

United States

  $ 1,672,952   $ 924,221   $ 849,737  

Canada

    92,039     84,530     73,728  
               

Total revenues

  $ 1,764,991   $ 1,008,751   $ 923,465  
               

 

 
  As of December 31,  
 
  2011   2010  
 
  (In thousands)
 

Net real estate property:

             

United States

  $ 15,510,824   $ 4,857,510  

Canada

    402,908     422,009  
           

Total net real estate property

  $ 15,913,732   $ 5,279,519  
           

Note 21—Condensed Consolidating Information

        At the time of initial issuance, we and certain of our direct and indirect wholly owned subsidiaries (the "Wholly Owned Subsidiary Guarantors") fully and unconditionally guaranteed, on a joint and several basis, the obligation to pay principal and interest with respect to the Ventas Issuers' 9% senior notes due 2012, 61/2% senior notes due 2016 and 63/4% senior notes due 2017. Ventas Capital Corporation, one of the Ventas Issuers, was formed in 2002 to facilitate offerings of the senior notes,

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Note 21—Condensed Consolidating Information (Continued)

has no assets or operations, and is a direct subsidiary of Ventas Realty, Limited Partnership, the other Ventas Issuer. Our other subsidiaries (the "Non-Guarantor Subsidiaries") did not provide a guarantee and therefore were not obligated with respect to the Ventas Issuers' senior notes. In September 2010, the Wholly Owned Subsidiary Guarantors were released from their obligations with respect to the Ventas Issuers' 61/2% senior notes due 2016 and 63/4% senior notes due 2017 pursuant to the terms of the applicable indentures.

        In connection with the NHP acquisition, our wholly owned subsidiary, NHP LLC, assumed the obligation to pay principal and interest with respect to the 81/4% senior notes due 2012, the 6.25% senior notes due 2013, the 6.00% senior notes due 2015, the 6.90% senior notes due 2037 and the 6.59% senior notes due 2038 of NHP. We, the Ventas Issuers and our subsidiaries (other than NHP LLC) are not obligated with respect to NHP LLC's senior notes.

        Contractual and legal restrictions, including those contained in the instruments governing our subsidiaries' outstanding mortgage indebtedness, may under certain circumstances restrict our ability to obtain cash from our subsidiaries for the purpose of meeting our debt service obligations, including our guarantee of payment of principal and interest on the Ventas Issuers' senior notes. Certain of our real estate assets are also subject to mortgages.

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Note 21—Condensed Consolidating Information (Continued)

        The following summarizes our condensed consolidating information as of December 31, 2011 and 2010 and for the years ended December 31, 2011, 2010, and 2009:


CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2011

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Assets

                                     

Net real estate investments

  $ 309   $ 3,629,489   $ 519,042   $ 12,082,772   $   $ 16,231,612  

Cash and cash equivalents

    2,335     7,820         35,652         45,807  

Escrow deposits and restricted cash

    1,971     27,523     7,513     39,583         76,590  

Deferred financing costs, net

    757     434     19,239     6,239         26,669  

Investment in and advances to affiliates

    8,612,892         1,728,635         (10,341,527 )    

Other assets

    54,415     183,801     47,063     605,953         891,232  
                           

Total assets

  $ 8,672,679   $ 3,849,067   $ 2,321,492   $ 12,770,199   $ (10,341,527 ) $ 17,271,910  
                           

Liabilities and equity

                                     

Liabilities:

                                     

Senior notes payable and other debt

  $   $ 502,215   $ 2,593,176   $ 3,333,725   $   $ 6,429,116  

Intercompany loans

    (68,408 )   679,634     (655,914 )   44,688          

Accrued interest

        1,431     12,561     23,702         37,694  

Accounts payable and other liabilities

    86,101     184,331     18,162     797,003         1,085,597  

Deferred income taxes

    260,722                     260,722  
                           

Total liabilities

    278,415     1,367,611     1,967,985     4,199,118         7,813,129  

Redeemable OP unitholder interests

                102,837         102,837  

Total equity

    8,394,264     2,481,456     353,507     8,468,244     (10,341,527 )   9,355,944  
                           

Total liabilities and equity

  $ 8,672,679   $ 3,849,067   $ 2,321,492   $ 12,770,199   $ (10,341,527 ) $ 17,271,910  
                           

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 21—Condensed Consolidating Information (Continued)

CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2010

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Assets

                                     

Net real estate investments

  $ 937   $ 3,228,731   $ 688,158   $ 1,526,288   $   $ 5,444,114  

Cash and cash equivalents

    1,083     13,440         7,289         21,812  

Escrow deposits and restricted cash

    76     19,787     9,169     9,908         38,940  

Deferred financing costs, net

    2,691     1,961     7,961     6,920         19,533  

Investment in and advances to affiliates

    712,545         1,728,685         (2,441,230 )    

Other assets

    75,794     106,211     8,057     43,560         233,622  
                           

Total assets

  $ 793,126   $ 3,370,130   $ 2,442,030   $ 1,593,965   $ (2,441,230 ) $ 5,758,021  
                           

Liabilities and equity

                                     

Liabilities:

                                     

Senior notes payable and other debt

  $ 225,644   $ 539,564   $ 1,301,089   $ 833,747   $   $ 2,900,044  

Intercompany loans

    (144,897 )   571,955     (434,454 )   7,396          

Accrued interest

    (113 )   2,704     12,852     3,853         19,296  

Accounts payable and other liabilities

    41,339     102,723     15,712     47,369         207,143  

Deferred income taxes

    241,333                     241,333  
                           

Total liabilities

    363,306     1,216,946     895,199     892,365         3,367,816  

Total equity

    429,820     2,153,184     1,546,831     701,600     (2,441,230 )   2,390,205  
                           

Total liabilities and equity

  $ 793,126   $ 3,370,130   $ 2,442,030   $ 1,593,965   $ (2,441,230 ) $ 5,758,021  
                           

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 21—Condensed Consolidating Information (Continued)


CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Year Ended December 31, 2011

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Revenues:

                                     

Rental income

  $ 2,471   $ 224,683   $ 284,320   $ 308,106   $   $ 819,580  

Resident fees and services

        355,946         517,362         873,308  

Medical office building and other services revenues

        34,374         2,097         36,471  

Income from loans and investments

    6,305     2,755     8,570     16,785         34,415  

Equity earnings in affiliates

    231,297     1,447             (232,744 )    

Interest and other income

    208     9     57     943         1,217  
                           

Total revenues

    240,281     619,214     292,947     845,293     (232,744 )   1,764,991  

Expenses:

                                     

Interest

    (1,897 )   59,642     74,157     104,905         236,807  

Depreciation and amortization

    1,715     129,588     35,441     289,846         456,590  

Property-level operating expenses

        271,605     510     379,446         651,561  

Medical office building services costs

        27,082                 27,082  

General, administrative and professional fees

    (5,328 )   38,115     29,336     12,414         74,537  

Loss on extinguishment of debt

    2,071     16,764     8,769             27,604  

Litigation proceeds, net

    (202,259 )                   (202,259 )

Merger-related expenses and deal costs

    111,845     3,779         38,299         153,923  

Other

    778     5,010         2,865         8,653  
                           

Total expenses

    (93,075 )   551,585     148,213     827,775         1,434,498  
                           

Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest

    333,356     67,629     144,734     17,518     (232,744 )   330,493  

Loss from unconsolidated entities

            (52 )           (52 )

Income tax benefit

    31,137                     31,137  
                           

Income from continuing operations

    364,493     67,629     144,682     17,518     (232,744 )   361,578  

Discontinued operations

                1,683         1,683  

Net income

    364,493     67,629     144,682     19,201     (232,744 )   363,261  

Net loss attributable to noncontrolling interest

                (1,232 )       (1,232 )
                           

Net income attributable to common stockholders

  $ 364,493   $ 67,629   $ 144,682   $ 20,433   $ (232,744 ) $ 364,493  
                           

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 21—Condensed Consolidating Information (Continued)


CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Year Ended December 31, 2010

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Revenues:

                                     

Rental income

  $ 2,409   $ 196,676   $ 272,366   $ 60,005   $   $ 531,456  

Resident fees and services

        257,659         188,642         446,301  

Medical office building and other services revenues

        14,570         (472 )       14,098  

Income from loans and investments

    5,666     2,957     7,789             16,412  

Equity earnings in affiliates

    258,442     1,914             (260,356 )    

Interest and other income

    332     60     83     9         484  
                           

Total revenues

    266,849     473,836     280,238     248,184     (260,356 )   1,008,751  

Expenses:

                                     

Interest

    1,758     74,937     50,403     48,533         175,631  

Depreciation and amortization

    1,636     111,456     35,851     54,819         203,762  

Property-level operating expenses

        177,733     519     137,701         315,953  

Medical office building services costs

        9,517         1         9,518  

General, administrative and professional fees

    (2,549 )   25,306     21,618     5,455         49,830  

Loss on extinguishment of debt

        798     8,993             9,791  

Merger-related expenses and deal costs

    14,291     4,710         242         19,243  

Other

    219     52         1         272  
                           

Total expenses

    15,355     404,509     117,384     246,752         784,000  
                           

Income before loss from unconsolidated entities, income taxes, discontinued operations and noncontrolling interest

    251,494     69,327     162,854     1,432     (260,356 )   224,751  

Loss from unconsolidated entities

            (664 )           (664 )

Income tax expense

    (5,201 )                   (5,201 )
                           

Income from continuing operations

    246,293     69,327     162,190     1,432     (260,356 )   218,886  

Discontinued operations

    (126 )   216     29,207     1,546         30,843  
                           

Net income

    246,167     69,543     191,397     2,978     (260,356 )   249,729  

Net income attributable to noncontrolling interest, net of tax

                3,562         3,562  
                           

Net income (loss) attributable to common stockholders

  $ 246,167   $ 69,543   $ 191,397   $ (584 ) $ (260,356 ) $ 246,167  
                           

161


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 21—Condensed Consolidating Information (Continued)

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Year Ended December 31, 2009

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-
Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Revenues:

                                     

Rental income

  $ 2,351   $ 147,737   $ 276,008   $ 62,362   $   $ 488,458  

Resident fees and services

        161,380         259,678         421,058  

Income from loans and investments

        3     13,104             13,107  

Equity earnings in affiliates

    264,163     2,309             (266,472 )    

Interest and other income

    1     18     800     23         842  
                           

Total revenues

    266,515     311,447     289,912     322,063     (266,472 )   923,465  

Expenses:

                                     

Interest

    4,318     21,975     88,988     58,529         173,810  

Depreciation and amortization

    651     89,156     40,398     67,093         197,298  

Property-level operating expenses

        118,625     456     183,732         302,813  

General, administrative and professional fees

    109     14,709     18,934     5,078         38,830  

Loss on extinguishment of debt

            6,012     68         6,080  

Merger-related expenses and deal costs

        11,682     1,333             13,015  

Other

    (3,339 )   39,140     (35,107 )   (644 )       50  
                           

Total expenses

    1,739     295,287     121,014     313,856         731,896  
                           

Income before income taxes, discontinued operations and noncontrolling interest

    264,776     16,160     168,898     8,207     (266,472 )   191,569  

Income tax benefit

    1,719                     1,719  
                           

Income from continuing operations

    266,495     16,160     168,898     8,207     (266,472 )   193,288  

Discontinued operations

        1,273     61,981     12,818         76,072  
                           

Net income

    266,495     17,433     230,879     21,025     (266,472 )   269,360  

Net (loss) income attributable to noncontrolling interest, net of tax

        (431 )       3,296         2,865  
                           

Net income attributable to common stockholders

  $ 266,495   $ 17,864   $ 230,879   $ 17,729   $ (266,472 ) $ 266,495  
                           

162


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 21—Condensed Consolidating Information (Continued)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Year Ended December 31, 2011

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-
Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Net cash provided by operating activities

  $ 124,784   $ 147,052   $ 199,431   $ 301,930   $   $ 773,197  

Net cash (used in) provided by investing activities

   
(618,663

)
 
105,279
   
(500,879

)
 
16,824
   
   
(997,439

)

Cash flows from financing activities:

                                     

Net change in borrowings under revolving credit facilities

        132,452     405,000             537,452  

Proceeds from debt

    (230,000 )       1,069,374     504,266         1,343,640  

Repayment of debt

        (216,293 )   (206,500 )   (966,169 )       (1,388,962 )

Net change in intercompany debt

    1,363,963     (62,196 )   (1,559,518 )   257,751          

Payment of deferred financing costs

            (19,661 )   (379 )       (20,040 )

Issuance of common stock, net

    299,847                     299,847  

Cash distribution (to) from affiliates

    (417,763 )   (111,914 )   612,798     (83,121 )        

Cash distribution to common stockholders

    (521,046 )                   (521,046 )

Cash distribution to redeemable OP unitholders

    (2,359 )                   (2,359 )

Purchases of redeemable OP units

                (185 )       (185 )

Contributions from noncontrolling interest

                2         2  

Distributions to noncontrolling interest

                (2,556 )       (2,556 )

Other

    2,489                     2,489  
                           

Net cash provided by (used in) financing activities

    495,131     (257,951 )   301,493     (290,391 )       248,282  
                           

Net increase (decrease) in cash and cash equivalents

    1,252     (5,620 )   45     28,363         24,040  

Effect of foreign currency translation on cash and cash equivalents

            (45 )           (45 )

Cash and cash equivalents at beginning of period

    1,083     13,440         7,289         21,812  
                           

Cash and cash equivalents at end of period

  $ 2,335   $ 7,820   $   $ 35,652   $   $ 45,807  
                           

163


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 21—Condensed Consolidating Information (Continued)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Year Ended December 31, 2010

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-
Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Net cash provided by operating activities

  $ 14,092   $ 217,820   $ 213,295   $ 2,415   $   $ 447,622  

Net cash used in investing activities

   
   
(32,175

)
 
(266,609

)
 
(3,136

)
 
   
(301,920

)

Cash flows from financing activities:

                                     

Net change in borrowings under revolving credit facilities

        (11,436 )   40,000             28,564  

Proceeds from debt

            595,712     1,670         597,382  

Repayment of debt

        (262,370 )   (244,710 )   (17,680 )       (524,760 )

Net change in intercompany debt

    (95,762 )   128,791     (26,250 )   (6,779 )        

Payment of deferred financing costs

        (47 )   (2,647 )           (2,694 )

Cash distribution from (to) affiliates

    405,433     (34,933 )   (391,842 )   21,342          

Cash distribution to common stockholders

    (336,085 )                   (336,085 )

Contributions from noncontrolling interest

                818         818  

Distributions to noncontrolling interest

                (8,082 )       (8,082 )

Other

    13,405                     13,405  
                           

Net cash used in financing activities

    (13,009 )   (179,995 )   (29,737 )   (8,711 )       (231,452 )
                           

Net increase (decrease) in cash and cash equivalents

    1,083     5,650     (83,051 )   (9,432 )       (85,750 )

Effect of foreign currency translation on cash and cash equivalents

            165             165  

Cash and cash equivalents at beginning of period

        7,790     82,886     16,721         107,397  
                           

Cash and cash equivalents at end of period

  $ 1,083   $ 13,440   $   $ 7,289   $   $ 21,812  
                           

164


Table of Contents


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 21—Condensed Consolidating Information (Continued)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Year Ended December 31, 2009

 
  Ventas, Inc.   Wholly
Owned
Subsidiary
Guarantors
  Ventas
Issuers
  Non-
Guarantor
Subsidiaries
  Consolidated
Elimination
  Consolidated  
 
  (In thousands)
 

Net cash provided by operating activities

  $ 1,385   $ 125,216   $ 220,936   $ 74,564   $   $ 422,101  

Net cash provided by (used in) investing activities

   
   
570
   
11,447
   
(13,763

)
 
   
(1,746

)

Cash flows from financing activities:

                                     

Net change in borrowings under revolving credit facilities

        (42,633 )   (250,240 )           (292,873 )

Proceeds from debt

        276     166,000     199,406         365,682  

Repayment of debt

        (36,703 )   (433,528 )   (54,942 )       (525,173 )

Net change in intercompany debt

    (44,623 )   (22,143 )   105,402     (38,636 )        

Payment of deferred financing costs

        (1,172 )   (11,034 )   (4,449 )       (16,655 )

Issuance of common stock, net

    299,201                     299,201  

Cash distribution from (to) affiliates

    55,741     (29,603 )   128,575     (154,713 )        

Cash distribution to common stockholders

    (314,399 )                   (314,399 )

Contributions from noncontrolling interest

                1,211         1,211  

Distributions to noncontrolling interest

        (379 )       (9,490 )       (9,869 )

Other

    2,695                     2,695  
                           

Net cash used in financing activities

    (1,385 )   (132,357 )   (294,825 )   (61,613 )       (490,180 )
                           

Net decrease in cash and cash equivalents

        (6,571 )   (62,442 )   (812 )       (69,825 )

Effect of foreign currency translation on cash and cash equivalents

            410             410  

Cash and cash equivalents at beginning of period

        14,361     144,918     17,533         176,812  
                           

Cash and cash equivalents at end of period

  $   $ 7,790   $ 82,886   $ 16,721   $   $ 107,397  
                           

165


Table of Contents


VENTAS, INC.

SCHEDULE III
REAL ESTATE AND ACCUMULATED DEPRECIATION
December 31, 2011
(Dollars in Thousands)

 
  For the Years Ended December 31,  
 
  2011   2010   2009  
 
  (In thousands)
 

Reconciliation of real estate:

                   

Carrying cost:

                   

Balance at beginning of period

  $ 6,600,886   $ 6,292,621   $ 6,160,630  

Additions during period:

                   

Acquisitions

    10,491,275     315,538     108,376  

Capital expenditures

    102,918     21,038     13,798  

Dispositions:

                   

Sales and/or transfers to assets held for sale

    (157,764 )   (46,083 )   (34,525 )

Foreign currency translation

    (7,911 )   17,772     44,342  
               

Balance at end of period

  $ 17,029,404   $ 6,600,886   $ 6,292,621  
               

Accumulated depreciation:

                   

Balance at beginning of period

  $ 1,368,219   $ 1,177,911   $ 987,691  

Additions during period:

                   

Depreciation expense

    380,734     197,256     198,789  

Dispositions:

                   

Sales and/or transfers to assets held for sale

    (16,536 )   (8,259 )   (11,469 )

Foreign currency translation

    (2,441 )   1,311     2,900  
               

Balance at end of period

  $ 1,729,976   $ 1,368,219   $ 1,177,911  
               

166


Table of Contents

VENTAS, INC.

SCHEDULE III
REAL ESTATE AND ACCUMULATED DEPRECIATION
December 31, 2011
(Dollars in Thousands)

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

 

KINDRED SKILLED NURSING FACILITIES

                                                                             

0791

 

Whitesburg Gardens Health Care Center

  Huntsville   AL   $   $ 534   $ 4,216   $   $ 534   $ 4,216   $ 4,750   $ 3,491   $ 1,259     1968     1991   25 years

0824

 

Specialty Healthcare & Rehabilitation Center of Mobile

  Mobile   AL         5     2,981         5     2,981     2,986     2,042     944     1967     1992   29 years

0853

 

Kachina Point Health Care and Rehabilitation Center

  Sedona   AZ         364     4,179         364     4,179     4,543     2,842     1,701     1983     1984   45 years

0743

 

Desert Life Rehabilitation and Care Center

  Tucson   AZ         611     5,117         611     5,117     5,728     4,117     1,611     1979     1982   37 years

0851

 

Villa Campana Health Care Center

  Tucson   AZ         533     2,201         533     2,201     2,734     1,258     1,476     1983     1993   35 years

0738

 

Bay View Nursing and Rehabilitation Center

  Alameda   CA         1,462     5,981         1,462     5,981     7,443     4,140     3,303     1967     1993   45 years

0167

 

Canyonwood Nursing and Rehab Center

  Redding   CA         401     3,784         401     3,784     4,185     1,947     2,238     1989     1989   45 years

0150

 

The Tunnell Center for Rehabilitation & Heathcare

  San Francisco   CA         1,902     7,531         1,902     7,531     9,433     5,100     4,333     1967     1993   28 years

0335

 

Lawton Healthcare Center

  San Francisco   CA         943     514         943     514     1,457     447     1,010     1962     1996   20 years

0148

 

Village Square Nursing and Rehabilitation Center

  San Marcos   CA         766     3,507         766     3,507     4,273     1,585     2,688     1989     1993   42 years

0350

 

Valley Gardens Health Care & Rehabilitation Center

  Stockton   CA         516     3,405         516     3,405     3,921     1,837     2,084     1988     1988   29 years

0745

 

Aurora Care Center

  Aurora   CO         197     2,328         197     2,328     2,525     1,530     995     1962     1995   30 years

0873

 

Brighton Care Center

  Brighton   CO         282     3,377         282     3,377     3,659     2,276     1,383     1969     1992   30 years

0744

 

Cherry Hills Health Care Center

  Englewood   CO         241     2,180         241     2,180     2,421     1,514     907     1960     1995   30 years

0859

 

Malley Healthcare and Rehabilitation Center

  Northglenn   CO         501     8,294         501     8,294     8,795     5,300     3,495     1971     1993   29 years

0568

 

Parkway Pavilion Healthcare

  Enfield   CT         337     3,607         337     3,607     3,944     2,663     1,281     1968     1994   28 years

0562

 

Andrew House Healthcare

  New Britain   CT         247     1,963         247     1,963     2,210     1,252     958     1967     1992   29 years

0563

 

The Crossings West Campus

  New London   CT         202     2,363         202     2,363     2,565     1,612     953     1969     1994   28 years

0567

 

The Crossings East Campus

  New London   CT         401     2,776         401     2,776     3,177     2,056     1,121     1968     1992   29 years

0566

 

Windsor Rehabilitation and Healthcare Center

  Windsor   CT         368     2,520         368     2,520     2,888     1,853     1,035     1965     1994   30 years

1228

 

Lafayette Nursing and Rehab Center

  Fayetteville   GA         598     6,623         598     6,623     7,221     5,305     1,916     1989     1995   20 years

0645

 

Specialty Care of Marietta

  Marietta   GA         241     2,782         241     2,782     3,023     1,930     1,093     1968     1993   28.5 years

0155

 

Savannah Rehabilitation & Nursing Center

  Savannah   GA         213     2,772         213     2,772     2,985     1,846     1,139     1968     1993   28.5 years

0660

 

Savannah Specialty Care Center

  Savannah   GA         157     2,219         157     2,219     2,376     1,735     641     1972     1991   26 years

0216

 

Boise Health and Rehabilitation Center

  Boise   ID         256     3,593         256     3,593     3,849     1,360     2,489     1977     1998   45 years

0218

 

Canyon West Health and Rehabilitation Center

  Caldwell   ID         312     2,050         312     2,050     2,362     859     1,503     1974     1998   45 years

0409

 

Mountain Valley Care & Rehabilitation Center

  Kellogg   ID         68     1,280         68     1,280     1,348     1,280     68     1971     1984   25 years

0221

 

Lewiston Rehabilitation & Care Center

  Lewiston   ID         133     3,982         133     3,982     4,115     3,130     985     1964     1984   29 years

0225

 

Aspen Park Healthcare

  Moscow   ID         261     2,571         261     2,571     2,832     2,198     634     1955     1990   25 years

0222

 

Nampa Care Center

  Nampa   ID         252     2,810         252     2,810     3,062     2,662     400     1950     1983   25 years

0223

 

Weiser Rehabilitation & Care Center

  Weiser   ID         157     1,760         157     1,760     1,917     1,821     96     1963     1983   25 years

0269

 

Meadowvale Health and Rehabilitation Center

  Bluffton   IN         7     787         7     787     794     553     241     1962     1995   22 years

0290

 

Bremen Health Care Center

  Bremen   IN         109     3,354         109     3,354     3,463     1,932     1,531     1982     1996   45 years

0694

 

Wedgewood Healthcare Center

  Clarksville   IN         119     5,115         119     5,115     5,234     2,929     2,305     1985     1995   35 years

0780

 

Columbus Health and Rehabilitation Center

  Columbus   IN         345     6,817         345     6,817     7,162     5,571     1,591     1966     1991   25 years

0131

 

Harrison Health and Rehabilitation Centre

  Corydon   IN         125     6,068         125     6,068     6,193     1,886     4,307     1998     1998   45 years

0209

 

Valley View Health Care Center

  Elkhart   IN         87     2,665         87     2,665     2,752     1,991     761     1985     1993   25 years

0213

 

Wildwood Health Care Center

  Indianapolis   IN         134     4,983         134     4,983     5,117     3,677     1,440     1988     1993   25 years

0294

 

Windsor Estates Health & Rehab Center

  Kokomo   IN         256     6,625         256     6,625     6,881     3,727     3,154     1962     1995   35 years

0407

 

Parkwood Health Care Center

  Lebanon   IN         121     4,512         121     4,512     4,633     3,314     1,319     1977     1993   25 years

0406

 

Muncie Health & Rehabilitation Center

  Muncie   IN         108     4,202         108     4,202     4,310     3,067     1,243     1980     1993   25 years

0111

 

Rolling Hills Health Care Center

  New Albany   IN         81     1,894         81     1,894     1,975     1,423     552     1984     1993   25 years

0112

 

Royal Oaks Health Care and Rehabilitation Center

  Terre Haute   IN         418     5,779         418     5,779     6,197     2,266     3,931     1995     1995   45 years

167


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

0113

 

Southwood Health & Rehabilitation Center

  Terre Haute   IN         90     2,868         90     2,868     2,958     2,127     831     1988     1993   25 years

0277

 

Rosewood Health Care Center

  Bowling Green   KY         248     5,371         248     5,371     5,619     3,837     1,782     1970     1990   30 years

0281

 

Riverside Manor Healthcare Center

  Calhoun   KY         103     2,119         103     2,119     2,222     1,533     689     1963     1990   30 years

0278

 

Oakview Nursing and Rehabilitation Center

  Calvert City   KY         124     2,882         124     2,882     3,006     2,059     947     1967     1990   30 years

0782

 

Danville Centre for Health and Rehabilitation

  Danville   KY         322     3,538         322     3,538     3,860     2,173     1,687     1962     1995   30 years

0787

 

Woodland Terrace Health Care Facility

  Elizabethtown   KY         216     1,795         216     1,795     2,011     1,889     122     1969     1982   26 years

0282

 

Maple Manor Health Care Center

  Greenville   KY         59     3,187         59     3,187     3,246     2,297     949     1968     1990   30 years

0864

 

Harrodsburg Health Care Center

  Harrodsburg   KY         137     1,830         137     1,830     1,967     1,477     490     1974     1985   35 years

0784

 

Northfield Centre for Health and Rehabilitation

  Louisville   KY         285     1,555         285     1,555     1,840     1,212     628     1969     1985   30 years

0785

 

Hillcrest Health Care Center

  Owensboro   KY         544     2,619         544     2,619     3,163     2,678     485     1963     1982   22 years

0280

 

Fountain Circle Health and Rehabilitation

  Winchester   KY         137     6,120         137     6,120     6,257     4,328     1,929     1967     1990   30 years

0582

 

Colony House Nursing and Rehabilitation Center

  Abington   MA         132     999         132     999     1,131     1,072     59     1965     1969   40 years

0581

 

Blueberry Hill Skilled Nursing & Rehabilitation Center

  Beverly   MA         129     4,290         129     4,290     4,419     3,144     1,275     1965     1968   40 years

0506

 

Presentation Nursing & Rehabilitation Center

  Brighton   MA         184     1,220         184     1,220     1,404     1,241     163     1968     1982   28 years

0588

 

Walden Rehabilitation and Nursing Center

  Concord   MA         181     1,347         181     1,347     1,528     1,371     157     1969     1968   40 years

0514

 

Sachem Skilled Nursing & Rehabilitation Center

  East Bridgewater   MA         529     1,238         529     1,238     1,767     1,514     253     1968     1982   27 years

0508

 

Crawford Skilled Nursing and Rehabilitation Center

  Fall River   MA         127     1,109         127     1,109     1,236     1,108     128     1968     1982   29 years

0532

 

Hillcrest Nursing and Rehabilitation Center

  Fitchburg   MA         175     1,461         175     1,461     1,636     1,467     169     1957     1984   25 years

0584

 

Franklin Skilled Nursing and Rehabilitation Center

  Franklin   MA         156     757         156     757     913     795     118     1967     1969   40 years

0518

 

Timberlyn Heights Nursing and Rehabilitation Center

  Great Barrington   MA         120     1,305         120     1,305     1,425     1,248     177     1968     1982   29 years

0585

 

Great Barrington Rehabilitation and Nursing Center

  Great Barrington   MA         60     1,142         60     1,142     1,202     1,136     66     1967     1969   40 years

0327

 

Laurel Ridge Rehabilitation and Nursing Center

  Jamaica Plain   MA         194     1,617         194     1,617     1,811     1,268     543     1968     1989   30 years

0587

 

River Terrace Healthcare

  Lancaster   MA         268     957         268     957     1,225     1,103     122     1969     1969   40 years

0529

 

Bolton Manor Nursing and Rehabilitation Center

  Marlborough   MA         222     2,431         222     2,431     2,653     1,988     665     1973     1984   34.5 years

0526

 

The Eliot Healthcare Center

  Natick   MA         249     1,328         249     1,328     1,577     1,291     286     1996     1982   31 years

0513

 

Hallmark Nursing and Rehabilitation Center

  New Bedford   MA         202     2,694         202     2,694     2,896     2,348     548     1968     1982   26 years

0503

 

Brigham Manor Nursing and Rehabilitation Center

  Newburyport   MA         126     1,708         126     1,708     1,834     1,518     316     1806     1982   27 years

0507

 

Country Rehabilitation and Nursing Center

  Newburyport   MA         199     3,004         199     3,004     3,203     2,618     585     1968     1982   27 years

0537

 

Quincy Rehabilitation and Nursing Center

  Quincy   MA         216     2,911         216     2,911     3,127     2,679     448     1965     1984   24 years

0542

 

Den-Mar Rehabilitation and Nursing Center

  Rockport   MA         23     1,560         23     1,560     1,583     1,403     180     1963     1985   30 years

0516

 

Hammersmith House Nursing Care Center

  Saugus   MA         112     1,919         112     1,919     2,031     1,652     379     1965     1982   28 years

0573

 

Eagle Pond Rehabilitation and Living Center

  South Dennis   MA         296     6,896         296     6,896     7,192     3,566     3,626     1985     1987   50 years

0501

 

Blue Hills Alzheimer's Care Center

  Stoughton   MA         511     1,026         511     1,026     1,537     1,361     176     1965     1982   28 years

0534

 

Country Gardens Skilled Nursing & Rehabilitation Center

  Swansea   MA         415     2,675         415     2,675     3,090     2,375     715     1969     1984   27 years

0198

 

Harrington House Nursing and Rehabilitation Center

  Walpole   MA         4     4,444         4     4,444     4,448     2,085     2,363     1991     1991   45 years

0517

 

Oakwood Rehabilitation and Nursing Center

  Webster   MA         102     1,154         102     1,154     1,256     1,121     135     1967     1982   31 years

0539

 

Newton and Wellesley Alzheimer Center

  Wellesley   MA         297     3,250         297     3,250     3,547     2,641     906     1971     1984   30 years

0544

 

Augusta Rehabilitation Center

  Augusta   ME         152     1,074         152     1,074     1,226     974     252     1968     1985   30 years

0545

 

Eastside Rehabilitation and Living Center

  Bangor   ME         316     1,349         316     1,349     1,665     1,164     501     1967     1985   30 years

0554

 

Westgate Manor

  Bangor   ME         287     2,718         287     2,718     3,005     2,281     724     1969     1985   31 years

0546

 

Winship Green Nursing Center

  Bath   ME         110     1,455         110     1,455     1,565     1,156     409     1974     1985   35 years

0547

 

Brewer Rehabilitation and Living Center

  Brewer   ME         228     2,737         228     2,737     2,965     2,055     910     1974     1985   33 years

0549

 

Kennebunk Nursing and Rehabilitation Center

  Kennebunk   ME         99     1,898         99     1,898     1,997     1,387     610     1977     1985   35 years

0550

 

Norway Rehabilitation & Living Center

  Norway   ME         133     1,658         133     1,658     1,791     1,212     579     1972     1985   39 years

0555

 

Brentwood Rehabilitation and Nursing Center

  Yarmouth   ME         181     2,789         181     2,789     2,970     2,112     858     1945     1985   45 years

0433

 

Parkview Acres Care and Rehabilitation Center

  Dillon   MT         207     2,578         207     2,578     2,785     1,735     1,050     1965     1993   29 years

0416

 

Park Place Health Care Center

  Great Falls   MT         600     6,311         600     6,311     6,911     4,213     2,698     1963     1993   28 years

0806

 

Chapel Hill Rehabilitation and Healthcare Center

  Chapel Hill   NC         347     3,029         347     3,029     3,376     2,104     1,272     1984     1993   28 years

0116

 

Pettigrew Rehabilitation and Healthcare Center

  Durham   NC         101     2,889         101     2,889     2,990     2,030     960     1969     1993   28 years

0146

 

Rose Manor Healthcare Center

  Durham   NC         200     3,527         200     3,527     3,727     2,764     963     1972     1991   26 years

0726

 

Guardian Care of Elizabeth City

  Elizabeth City   NC         71     561         71     561     632     632         1977     1982   20 years

0724

 

Rehabilitation and Health Center of Gastonia

  Gastonia   NC         158     2,359         158     2,359     2,517     1,652     865     1968     1992   29 years

0706

 

Guardian Care of Henderson

  Henderson   NC         206     1,997         206     1,997     2,203     1,347     856     1957     1993   29 years

0711

 

Kinston Rehabilitation and Healthcare Center

  Kinston   NC         186     3,038         186     3,038     3,224     1,963     1,261     1961     1993   29 years

0307

 

Lincoln Nursing Center

  Lincolnton   NC         39     3,309         39     3,309     3,348     2,439     909     1976     1986   35 years

0707

 

Rehabilitation and Nursing Center of Monroe

  Monroe   NC         185     2,654         185     2,654     2,839     1,893     946     1963     1993   28 years

168


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

0137

 

Sunnybrook Healthcare and Rehabilitation Specialists

  Raleigh   NC         187     3,409         187     3,409     3,596     2,797     799     1971     1991   25 years

0143

 

Raleigh Rehabilitation & Healthcare Center

  Raleigh   NC         316     5,470         316     5,470     5,786     4,449     1,337     1969     1991   25 years

0704

 

Guardian Care of Roanoke Rapids

  Roanoke Rapids   NC         339     4,132         339     4,132     4,471     3,292     1,179     1967     1991   25 years

0723

 

Guardian Care of Rocky Mount

  Rocky Mount   NC         240     1,732         240     1,732     1,972     1,394     578     1975     1997   25 years

0188

 

Cypress Pointe Rehabilitation and Health Care Centre

  Wilmington   NC         233     3,710         233     3,710     3,943     2,653     1,290     1966     1993   28.5 years

0191

 

Silas Creek Manor

  Winston-Salem   NC         211     1,893         211     1,893     2,104     1,289     815     1966     1993   28.5 years

0713

 

Guardian Care of Zebulon

  Zebulon   NC         179     1,933         179     1,933     2,112     1,306     806     1973     1993   29 years

0591

 

Dover Rehabilitation and Living Center

  Dover   NH         355     3,797         355     3,797     4,152     3,375     777     1969     1990   25 years

0593

 

Hanover Terrace Healthcare

  Hanover   NH         326     1,825         326     1,825     2,151     1,214     937     1969     1993   29 years

0592

 

Greenbriar Terrace Healthcare

  Nashua   NH         776     6,011         776     6,011     6,787     4,906     1,881     1963     1990   25 years

0640

 

Las Vegas Healthcare and Rehabilitation Center

  Las Vegas   NV         454     1,018         454     1,018     1,472     575     897     1940     1992   30 years

0641

 

Torrey Pines Care Center

  Las Vegas   NV         256     1,324         256     1,324     1,580     959     621     1971     1992   29 years

0634

 

Cambridge Health & Rehabilitation Center

  Cambridge   OH         108     2,642         108     2,642     2,750     1,986     764     1975     1993   25 years

0572

 

Winchester Place Nursing and Rehabilitation Center

  Canal Winchester   OH         454     7,149         454     7,149     7,603     5,355     2,248     1974     1993   28 years

0569

 

Chillicothe Nursing & Rehabilitation Center

  Chillicothe   OH         128     3,481         128     3,481     3,609     2,727     882     1976     1985   34 years

0560

 

Franklin Woods Nursing and Rehabilitation Center

  Columbus   OH         190     4,712         190     4,712     4,902     2,497     2,405     1986     1992   38 years

0577

 

Minerva Park Nursing and Rehabilitation Center

  Columbus   OH         210     3,684         210     3,684     3,894     1,434     2,460     1973     1997   45 years

0635

 

Coshocton Health & Rehabilitation Center

  Coshocton   OH         203     1,979         203     1,979     2,182     1,475     707     1974     1993   25 years

0868

 

Lebanon Country Manor

  Lebanon   OH         105     3,617         105     3,617     3,722     2,263     1,459     1984     1986   43 years

0571

 

Logan Health Care Center

  Logan   OH         169     3,750         169     3,750     3,919     2,577     1,342     1979     1991   30 years

0570

 

Pickerington Nursing & Rehabilitation Center

  Pickerington   OH         312     4,382         312     4,382     4,694     2,351     2,343     1984     1992   37 years

0453

 

Medford Rehabilitation and Healthcare Center

  Medford   OR         362     4,610         362     4,610     4,972     3,151     1,821     1961     1991   34 years

0452

 

Sunnyside Care Center

  Salem   OR         1,512     2,249         1,512     2,249     3,761     1,386     2,375     1981     1991   30 years

1237

 

Wyomissing Nursing and Rehabilitation Center

  Reading   PA         61     5,095         61     5,095     5,156     2,004     3,152     1966     1993   45 years

1224

 

Chestnut Terrace Nursing and Rehabilitation Center

  E. Providence   RI         174     2,643         174     2,643     2,817     1,061     1,756     1962     1990   45 years

1231

 

Oak Hill Nursing and Rehabilitation Center

  Pawtucket   RI         91     6,724         91     6,724     6,815     2,680     4,135     1966     1990   45 years

0884

 

Masters Health Care Center

  Algood   TN         524     4,370         524     4,370     4,894     2,996     1,898     1981     1987   38 years

0132

 

Madison Healthcare and Rehabilitation Center

  Madison   TN         168     1,445         168     1,445     1,613     1,010     603     1968     1992   29 years

0822

 

Primacy Healthcare and Rehabilitation Center

  Memphis   TN         1,222     8,344         1,222     8,344     9,566     5,005     4,561     1980     1990   37 years

0140

 

Wasatch Care Center

  Ogden   UT         373     597         373     597     970     591     379     1964     1990   25 years

0247

 

St. George Care and Rehabilitation Center

  Saint George   UT         419     4,465         419     4,465     4,884     2,781     2,103     1976     1993   29 years

0655

 

Federal Heights Rehabilitation and Nursing Center

  Salt Lake City   UT         201     2,322         201     2,322     2,523     1,617     906     1962     1992   29 years

0230

 

Crosslands Rehabilitation & Healthcare Center

  Sandy   UT         334     4,300         334     4,300     4,634     2,211     2,423     1987     1992   40 years

0826

 

Harbour Pointe Medical and Rehabilitation Center

  Norfolk   VA         427     4,441         427     4,441     4,868     3,040     1,828     1969     1993   28 years

0825

 

Nansemond Pointe Rehabilitation and Healthcare Center

  Suffolk   VA         534     6,990         534     6,990     7,524     4,479     3,045     1963     1991   32 years

0829

 

River Pointe Rehabilitation and Healthcare Center

  Virginia Beach   VA         770     4,440         770     4,440     5,210     3,703     1,507     1953     1991   25 years

0842

 

Bay Pointe Medical and Rehabilitation Center

  Virginia Beach   VA         805     2,886     (380 )   425     2,886     3,311     1,898     1,413     1971     1993   29 years

0559

 

Birchwood Terrace Healthcare

  Burlington   VT         15     4,656         15     4,656     4,671     3,936     735     1965     1990   27 years

0158

 

Bellingham Health Care and Rehabilitation Services

  Bellingham   WA         441     3,824         441     3,824     4,265     2,583     1,682     1972     1993   28.5 years

0168

 

Lakewood Healthcare Center

  Lakewood   WA         504     3,511         504     3,511     4,015     1,959     2,056     1989     1989   45 years

0127

 

Northwest Continuum Care Center

  Longview   WA         145     2,563         145     2,563     2,708     1,761     947     1955     1992   29 years

0165

 

Rainier Vista Care Center

  Puyallup   WA         520     4,780         520     4,780     5,300     2,429     2,871     1986     1991   40 years

0114

 

Arden Rehabilitation and Healthcare Center

  Seattle   WA         1,111     4,013         1,111     4,013     5,124     2,693     2,431     1950     1993   28.5 years

0462

 

Queen Anne Healthcare

  Seattle   WA         570     2,750         570     2,750     3,320     1,928     1,392     1970     1993   29 years

0180

 

Vancouver Health & Rehabilitation Center

  Vancouver   WA         449     2,964         449     2,964     3,413     2,051     1,362     1970     1993   28 years

0765

 

Eastview Medical and Rehabilitation Center

  Antigo   WI         200     4,047         200     4,047     4,247     3,223     1,024     1962     1991   28 years

0767

 

Colony Oaks Care Center

  Appleton   WI         353     3,571         353     3,571     3,924     2,640     1,284     1967     1993   29 years

0773

 

Mount Carmel Medical and Rehabilitation Center

  Burlington   WI         274     7,205         274     7,205     7,479     4,430     3,049     1971     1991   30 years

0289

 

San Luis Medical and Rehabilitation Center

  Green Bay   WI         259     5,299         259     5,299     5,558     4,152     1,406     1968     1996   25 years

0775

 

Sheridan Medical Complex

  Kenosha   WI         282     4,910         282     4,910     5,192     3,953     1,239     1964     1991   25 years

0776

 

Woodstock Health and Rehabilitation Center

  Kenosha   WI         562     7,424         562     7,424     7,986     6,183     1,803     1970     1991   25 years

0769

 

North Ridge Medical and Rehabilitation Center

  Manitowoc   WI         206     3,785         206     3,785     3,991     2,665     1,326     1964     1992   29 years

0774

 

Mt. Carmel Health & Rehabilitation Center

  Milwaukee   WI         2,678     25,867         2,678     25,867     28,545     19,391     9,154     1958     1991   30 years

0770

 

Vallhaven Care Center

  Neenah   WI         337     5,125         337     5,125     5,462     3,620     1,842     1966     1993   28 years

0771

 

Kennedy Park Medical & Rehabilitation Center

  Schofield   WI         301     3,596         301     3,596     3,897     3,594     303     1966     1982   29 years

0766

 

Colonial Manor Medical and Rehabilitation Center

  Wausau   WI         169     3,370         169     3,370     3,539     2,120     1,419     1964     1995   30 years

0441

 

Mountain Towers Healthcare and Rehabilitation Center

  Cheyenne   WY         342     3,468         342     3,468     3,810     2,260     1,550     1964     1992   29 years

0481

 

South Central Wyoming Healthcare and Rehabilitation

  Rawlins   WY         151     1,738         151     1,738     1,889     1,157     732     1955     1993   29 years

0482

 

Wind River Healthcare and Rehabilitation Center

  Riverton   WY         179     1,559         179     1,559     1,738     1,024     714     1967     1992   29 years

0483

 

Sage View Care Center

  Rock Springs   WY         287     2,392         287     2,392     2,679     1,614     1,065     1964     1993   30 years
                                                                 

 

TOTAL KINDRED SKILLED NURSING FACILITIES

                50,734     544,311     (380 )   50,354     544,311     594,665     383,013     211,652                

169


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

 

NON-KINDRED SKILLED NURSING FACILITIES

                                                                             

7562

 

Saline Nursing Center

  Benton   AR         650     13,540         650     13,540     14,190     225     14,141     1992     2011   35 years

7565

 

Regional Nursing Center

  Bryant   AR         480     12,455         480     12,455     12,935     209     12,886     1989     2011   35 years

3786

 

Beverly Health Care Golflinks

  Hot Springs   AR         500     11,311         500     11,311     11,811     198     11,765     1978     2011   35 years

7566

 

Lakewood Rehab Center

  Lake Village   AR         560     8,594         560     8,594     9,154     152     9,115     1998     2011   35 years

7560

 

Countrywood Estates

  Monticello   AR         260     9,542         260     9,542     9,802     155     9,767     1995     2011   35 years

7561

 

Riverview Manor

  Morrilton   AR         240     9,476         240     9,476     9,716     159     9,677     1988     2011   35 years

7564

 

Brookridge Life Care & Rehab

  Morrilton   AR         410     11,069         410     11,069     11,479     189     11,432     1996     2011   35 years

7563

 

Wynwood Nursing Center

  Wynne   AR         290     10,763         290     10,763     11,053     179     11,011     1990     2011   35 years

3765

 

Chowchilla Convalescent Center

  Chowchilla   CA         1,780     5,097         1,780     5,097     6,877     91     6,874     1965     2011   35 years

7140

 

Driftwood Gilroy

  Gilroy   CA         3,330     13,665         3,330     13,665     16,995     234     16,969     1968     2011   35 years

7390

 

Orange Hills Convalescent Hospital

  Orange   CA         960     20,968         960     20,968     21,928     338     21,845     1987     2011   35 years

7541

 

Park Place Health Center

  Hartford   CT         1,370     2,908         1,370     2,908     4,278     88     4,901     1969     2011   35 years

7542

 

Spectrum Healthcare Torrington

  Torrington   CT         1,770     2,716         1,770     2,716     4,486     71     4,475     1969     2011   35 years

7540

 

Laurel Hills/Highland Acres

  Winsted   CT         660     1,914         660     1,914     2,574     50     2,566     1960     2011   35 years

3779

 

Beverly Health—Ft. Pierce

  Ft. Pierce   FL         840     16,318         840     16,318     17,158     277     17,102     1960     2011   35 years

7551

 

Willowwood Health & Rehab Center

  Flowery Branch   GA         1,130     9,219         1,130     9,219     10,349     157     10,316     1970     2011   35 years

2437

 

Westbury

  Lisle   IL         730     9,270         730     9,270     10,000     1,090     8,910     1990     2009   35 years

1568

 

Rolling Hills

  Anderson   IN         1,600     6,710         1,600     6,710     8,310     123     8,293     1967     2011   35 years

1554

 

Chalet Village

  Berne   IN         590     1,654         590     1,654     2,244     46     2,383     1986     2011   35 years

1565

 

Vermillion Convalescent Center

  Clinton   IN         700     11,057         700     11,057     11,757     190     11,716     1971     2011   35 years

1560

 

Willow Crossing

  Columbus   IN         880     4,963         880     4,963     5,843     96     5,821     1988     2011   35 years

1555

 

Willowbend Nursing Center

  East Muncie   IN         1,080     4,026         1,080     4,026     5,106     75     5,348     1976     2011   35 years

1567

 

Greenhill Manor

  Fowler   IN         380     7,659         380     7,659     8,039     128     8,013     1973     2011   35 years

1556

 

Twin City Healthcare

  Gas City   IN         350     3,012         350     3,012     3,362     62     5,501     1974     2011   35 years

1566

 

Hanover

  Hanover   IN         1,070     3,903         1,070     3,903     4,973     92     4,944     1975     2011   35 years

1561

 

AmeriCare of Hartford City

  Hartford City   IN         470     1,855         470     1,855     2,325     48     2,407     1988     2011   35 years

1562

 

Oakbrook Village

  Huntington   IN         600     1,950         600     1,950     2,550     43     3,560     1987     2011   35 years

1552

 

Lakeview Manor

  Indianapolis   IN         2,780     7,927         2,780     7,927     10,707     161     10,682     1968     2011   35 years

1569

 

Wintersong

  Knox   IN         420     2,019         420     2,019     2,439     42     2,944     1984     2011   35 years

1571

 

Magnolia Woodland

  Lawrenceburg   IN         340     3,757         340     3,757     4,097     82     4,291     1966     2011   35 years

1570

 

Monticello

  Monticello   IN         460     8,461         460     8,461     8,921     143     8,891     1988     2011   35 years

3767

 

Petersburg Health Care Center

  Petersburg   IN         310     8,443         310     8,443     8,753     146     8,720     1970     2011   35 years

1563

 

AmeriCare of Portland

  Portland   IN         400     9,597         400     9,597     9,997     166     9,958     1964     2011   35 years

3766

 

Oakridge Convalescent Center

  Richmond   IN         640     11,128         640     11,128     11,768     194     11,725     1975     2011   35 years

1557

 

Liberty Village

  St. Muncie   IN         1,520     7,542         1,520     7,542     9,062     133     9,069     2001     2011   35 years

1553

 

Westridge Healthcare Center

  Terre Haute   IN         690     5,384         690     5,384     6,074     96     6,055     1965     2011   35 years

1572

 

Magnolia Washington

  Washington   IN         220     10,054         220     10,054     10,274     177     13,245     1968     2011   35 years

1558

 

Americare of Winchester

  Winchester   IN         730     6,039         730     6,039     6,769     103     6,752     1986     2011   35 years

7343

 

Belleville Health Care Center

  Belleville   KS         590     4,170         590     4,170     4,760     80     4,740     1977     2011   35 years

7347

 

Oak Ridge Acres

  Hiawatha   KS         350     590         350     590     940     21     919     1974     2011   35 years

7350

 

Smokey Hill Rehab Center

  Salina   KS         360     3,705         360     3,705     4,065     82     4,034     1981     2011   35 years

7348

 

Westwood Manor

  Topeka   KS         250     3,735         250     3,735     3,985     69     3,966     1973     2011   35 years

7152

 

Infinia at Wichita

  Wichita   KS         350     13,065         350     13,065     13,415     211     13,360     1965     2011   35 years

3835

 

Jackson Manor

  Annville   KY         131     4,442         131     4,442     4,573     656     3,917     1989     2006   35 years

3830

 

Colonial Health & Rehabilitation Center

  Bardstown   KY         38     2,829         38     2,829     2,867     418     2,449     1968     2006   35 years

3832

 

Green Valley Health & Rehabilitation Center

  Carrollton   KY         29     2,325         29     2,325     2,354     343     2,011     1978     2006   35 years

3845

 

Summit Manor Health & Rehabilitation Center

  Columbia   KY         38     12,510         38     12,510     12,548     1,847     10,701     1965     2006   35 years

3831

 

Glasgow Health & Rehabilitation Center

  Glasgow   KY         21     2,997         21     2,997     3,018     442     2,576     1968     2006   35 years

3841

 

Professional Care Health & Rehabilitation Center

  Hartford   KY         22     7,905         22     7,905     7,927     1,167     6,760     1967     2006   35 years

3833

 

Hart County Health Center

  Horse Cave   KY         68     6,059         68     6,059     6,127     894     5,233     1993     2006   35 years

3834

 

Heritage Hall Health & Rehabilitation Center

  Lawrenceburg   KY         38     3,920         38     3,920     3,958     579     3,379     1973     2006   35 years

3844

 

Tanbark Health & Rehabilitation Center

  Lexington   KY         868     6,061         868     6,061     6,929     895     6,034     1989     2006   35 years

3836

 

Jefferson Manor

  Louisville   KY         2,169     4,075         2,169     4,075     6,244     602     5,642     1982     2006   35 years

3837

 

Jefferson Place

  Louisville   KY         1,307     9,175         1,307     9,175     10,482     1,354     9,128     1991     2006   35 years

170


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

3838

 

Meadowview Health & Rehabilitation Center

  Louisville   KY         317     4,666         317     4,666     4,983     689     4,294     1973     2006   35 years

3842

 

Rockford Health & Rehabilitation Center

  Louisville   KY         364     9,568         364     9,568     9,932     1,412     8,520     1975     2006   35 years

3843

 

Summerfield Health & Rehabilitation Center

  Louisville   KY         1,089     10,756         1,089     10,756     11,845     1,588     10,257     1979     2006   35 years

3829

 

McCreary Health & Rehabilitation Center

  Pine Knot   KY         73     2,443         73     2,443     2,516     361     2,155     1990     2006   35 years

3840

 

North Hardin Health & Rehabilitation Center

  Radcliff   KY         218     11,944         218     11,944     12,162     1,763     10,399     1986     2006   35 years

3839

 

Monroe Health & Rehabilitation Center

  Tompkinsville   KY         32     8,756         32     8,756     8,788     1,293     7,495     1969     2006   35 years

1730

 

Wingate at Andover

  Andover   MA         1,450     14,798         1,450     14,798     16,248     258     16,855     1992     2011   35 years

1731

 

Wingate at Brighton

  Brighton   MA         1,070     7,383         1,070     7,383     8,453     147     9,963     1995     2011   35 years

7460

 

Danvers Nursing and Rehab

  Danvers   MA         720     8,388         720     8,388     9,108     166     9,040     1998     2011   35 years

1745

 

Chestnut Hill Rehab & Nursing

  East Longmeadow   MA         3,050     5,392         3,050     5,392     8,442     115     14,497     1985     2011   35 years

1747

 

Wingate at Haverhill

  Haverville   MA         810     9,288         810     9,288     10,098     177     10,774     1973     2011   35 years

1737

 

Skilled Care Center at Silver Lake

  Kingston   MA         3,230     19,870         3,230     19,870     23,100     372     22,988     1992     2011   35 years

1739

 

Wentworth Skilled Care Center

  Lowell   MA         820     11,220         820     11,220     12,040     193     12,373     1966     2011   35 years

1732

 

Wingate at Needham

  Needham   MA         920     9,236         920     9,236     10,156     176     12,404     1996     2011   35 years

1733

 

Wingate at Reading

  Reading   MA         920     7,499         920     7,499     8,419     145     9,155     1988     2011   35 years

1736

 

Wingate at South Hadley

  South Hadley   MA         1,870     15,572         1,870     15,572     17,442     266     17,373     1988     2011   35 years

1746

 

Ring East

  Springfield   MA         1,250     13,561         1,250     13,561     14,811     242     15,188     1987     2011   35 years

1734

 

Wingate at Sudbury

  Sudbury   MA         1,540     8,100         1,540     8,100     9,640     164     11,669     1997     2011   35 years

1744

 

Riverdale Gardens Rehab & Nursing

  West Springfield   MA         2,140     6,997         2,140     6,997     9,137     141     12,799     1960     2011   35 years

1735

 

Wingate at Wilbraham

  Wilbraham   MA         4,070     10,777         4,070     10,777     14,847     202     14,812     1988     2011   35 years

1740

 

Worcester Skilled Care Center

  Worcester   MA         620     10,958         620     10,958     11,578     202     13,369     1970     2011   35 years

3774

 

Cumberland Villa Nursing Center

  Cumberland   MD         660     23,970         660     23,970     24,630     381     24,556     1968     2011   35 years

3773

 

Colton Villa

  Hagerstown   MD         1,550     16,973         1,550     16,973     18,523     287     18,466     1971     2011   35 years

3775

 

Westminster Nursing & Convalescent Center

  Westminster   MD         2,160     15,931         2,160     15,931     18,091     269     18,047     1973     2011   35 years

7160

 

Waters of Park Point

  Duluth   MN         2,920     8,271         2,920     8,271     11,191     174     12,328     1971     2011   35 years

3784

 

Hopkins Healthcare

  Hopkins   MN         4,470     21,409         4,470     21,409     25,879     349     25,863     1961     2011   35 years

7005

 

Andrew Care Home

  Minneapolis   MN         3,280     5,083         3,280     5,083     8,363     149     8,312     1941     2011   35 years

3764

 

Golden Living Center—Rochester East

  Rochester   MN         639     3,497         639     3,497     4,136     3,549     587     1967     1982   28 years

7250

 

Ashland Healthcare

  Ashland   MO         770     4,400         770     4,400     5,170     79     5,232     1993     2011   35 years

7257

 

South Hampton Place

  Columbia   MO         710     11,279         710     11,279     11,989     189     11,952     1994     2011   35 years

7253

 

Dixon Nursing & Rehab

  Dixon   MO         570     3,342         570     3,342     3,912     64     3,897     1989     2011   35 years

7252

 

Current River Nursing

  Doniphan   MO         450     7,703         450     7,703     8,153     142     8,115     1991     2011   35 years

7254

 

Forsyth Care Center

  Forsyth   MO         710     6,731         710     6,731     7,441     129     7,406     1993     2011   35 years

3785

 

Maryville Health Care Center

  Maryville   MO         630     5,825         630     5,825     6,455     113     6,906     1972     2011   35 years

7255

 

Glenwood Healthcare

  Seymour   MO         670     3,737         670     3,737     4,407     70     4,393     1990     2011   35 years

7256

 

Silex Community Care

  Silex   MO         730     2,689         730     2,689     3,419     55     3,408     1991     2011   35 years

7251

 

Bellefontaine Gardens

  St. Louis   MO         1,610     4,314         1,610     4,314     5,924     90     5,910     1988     2011   35 years

2227

 

Gravios Nursing Center

  St. Louis   MO         1,560     10,582         1,560     10,582     12,142     199     12,318     1954     2011   35 years

7258

 

Strafford Care Center

  Strafford   MO         1,670     8,251         1,670     8,251     9,921     140     9,907     1995     2011   35 years

7259

 

Windsor Healthcare

  Windsor   MO         510     3,345         510     3,345     3,855     64     4,014     1996     2011   35 years

3770

 

Lakewood Manor

  Hendersonville   NC         1,610     7,759         1,610     7,759     9,369     148     9,342     1979     2011   35 years

2505

 

Lopatcong Center

  Phillipsburg   NJ         1,490     12,336         1,490     12,336     13,826     3,679     10,147     1982     2004   30 years

2226

 

Hearthstone of Northern Nevada

  Sparks   NV         1,400     9,365         1,400     9,365     10,765     173     10,724     1988     2011   35 years

1742

 

Wingate at St. Francis

  Beacon   NY         1,900     18,115         1,900     18,115     20,015     311     21,343     2002     2011   35 years

7583

 

Garden Gate

  Cheektowaga   NY         760     15,643         760     15,643     16,403     274     16,662     1979     2011   35 years

7581

 

Brookhaven

  East Patchogue   NY         1,100     25,840         1,100     25,840     26,940     412     26,860     1988     2011   35 years

1741

 

Wingate at Dutchess

  Fishkill   NY         1,300     19,685         1,300     19,685     20,985     334     21,918     1996     2011   35 years

7580

 

Autumn View

  Hamburg   NY         1,190     24,687         1,190     24,687     25,877     413     31,810     1983     2011   35 years

1743

 

Wingate at Ulster

  Highland   NY         1,500     18,223         1,500     18,223     19,723     298     19,648     1998     2011   35 years

7584

 

North Gate

  North Tonawanda   NY         1,010     14,801         1,010     14,801     15,811     265     15,741     1982     2011   35 years

7585

 

Seneca

  West Seneca   NY         1,400     13,491         1,400     13,491     14,891     236     14,838     1974     2011   35 years

7582

 

Harris Hill

  Williamsville   NY         1,240     33,574         1,240     33,574     34,814     533     34,711     1992     2011   35 years

2702

 

Burlington House

  Cincinnati   OH         918     5,087         918     5,087     6,005     1,331     4,674     1989     2004   35 years

2701

 

Regency Manor

  Columbus   OH         606     16,424         606     16,424     17,030     4,304     12,726     1883     2004   35 years

171


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

7451

 

Rosewood Manor (OH)

  Galion   OH         540     6,324         540     6,324     6,864     114     6,834     1967     2011   35 years

3920

 

Marietta Convalescent Center

  Marietta   OH         158     3,266     75     158     3,341     3,499     2,495     1,004     1972     1993   25 years

7453

 

Horizon Village (Gillette's)

  Warren   OH         1,100     8,196         1,100     8,196     9,296     173     9,458     1967     2011   35 years

7452

 

Whispering Pines Healthcare Center

  Washington Ct House   OH         490     13,460         490     13,460     13,950     219     13,902     1984     2011   35 years

7450

 

Boardman Comm CC Little Forest

  Youngstown   OH         380     5,960         380     5,960     6,340     143     7,262     1962     2011   35 years

7442

 

Western Hills Health Care Center

  Lawton   OK         520     680         520     680     1,200     48     1,152     1968     2011   35 years

7443

 

Willow Park Health Care Center

  Lawton   OK         300     12,164         300     12,164     12,464     209     12,406     1985     2011   35 years

7440

 

Temple Manor Nursing Home

  Temple   OK         300     1,779         300     1,779     2,079     38     2,067     1971     2011   35 years

7441

 

Tuttle Care Center

  Tuttle   OK         150     1,377         150     1,377     1,527     33     1,905     1960     2011   35 years

1510

 

Avamere Rehab of Coos Bay

  Coos Bay   OR         1,920     3,394         1,920     3,394     5,314     66     5,319     1968     2011   35 years

1502

 

Avamere Riverpark of Eugene

  Eugene   OR         1,960     17,622         1,960     17,622     19,582     287     19,555     1988     2011   35 years

1509

 

Avamere Rehab of Eugene

  Eugene   OR         1,080     7,257         1,080     7,257     8,337     129     8,319     1966     2011   35 years

1513

 

Avamere Rehab of Clackamas

  Gladstone   OR         820     3,844         820     3,844     4,664     72     4,654     1961     2011   35 years

1507

 

Avamere Rehab of Hillsboro

  Hillsboro   OR         1,390     8,628         1,390     8,628     10,018     151     10,000     1973     2011   35 years

1508

 

Avamere Rehab of Junction City

  Junction City   OR         590     5,583         590     5,583     6,173     96     6,159     1966     2011   35 years

1506

 

Avamere Rehab of King City

  King City   OR         1,290     10,646         1,290     10,646     11,936     178     11,917     1975     2011   35 years

1504

 

Avamere Rehab of Lebanon

  Lebanon   OR         980     12,954         980     12,954     13,934     210     13,910     1974     2011   35 years

1528

 

Newport Rehabilitation & Specialty Care Center

  Newport   OR         380     3,420         380     3,420     3,800     45     3,755     N/A     2011   35 years

1505

 

Avamere Crestview of Portland

  Portland   OR         1,610     13,942         1,610     13,942     15,552     230     15,529     1964     2011   35 years

1511

 

Avamere Twin Oaks of Sweet Home

  Sweet Home   OR         290     4,536         290     4,536     4,826     77     4,813     1972     2011   35 years

3852

 

Balanced Care at Bloomsburg

  Bloomsburg   PA         621     1,371         621     1,371     1,992     202     1,790     1997     2006   35 years

2507

 

The Belvedere

  Chester   PA         822     7,203         822     7,203     8,025     2,134     5,891     1899     2004   30 years

2228

 

Mountain View Nursing Home

  Greensburg   PA         580     12,817         580     12,817     13,397     223     15,409     1971     2011   35 years

7222

 

Laurels Health & Rehab at Kingston

  Kingston   PA         910     4,197         910     4,197     5,107     81     5,090     1995     2011   35 years

7220

 

Laurels Health & Rehab at Mid Valley

  Peckville   PA         350     2,348         350     2,348     2,698     46     2,685     1991     2011   35 years

2509

 

Pennsburg Manor

  Pennsburg   PA         1,091     7,871         1,091     7,871     8,962     2,403     6,559     1982     2004   30 years

2508

 

Chapel Manor

  Philadelphia   PA         1,595     13,982     1,358     1,595     15,340     16,935     4,143     12,792     1948     2004   30 years

2506

 

Wayne Center

  Wayne   PA         662     6,872     850     662     7,722     8,384     2,187     6,197     1875     2004   30 years

7176

 

Epic- Bayview

  Beaufort   SC         890     14,311         890     14,311     15,201     253     15,136     1970     2011   35 years

7170

 

Dundee Nursing Home

  Bennettsville   SC         320     8,693         320     8,693     9,013     154     8,970     1958     2011   35 years

7175

 

Epic-Conway

  Conway   SC         1,090     16,880         1,090     16,880     17,970     292     17,900     1975     2011   35 years

7171

 

Mt. Pleasant Nursing Center

  Mt. Pleasant   SC         1,810     9,079         1,810     9,079     10,889     165     10,858     1977     2011   35 years

7380

 

Firesteel

  Mitchell   SD         690     15,360         690     15,360     16,050     261     15,996     1966     2011   35 years

7381

 

Fountain Springs Healthcare Center

  Rapid City   SD         940     28,647         940     28,647     29,587     440     29,527     1989     2011   35 years

7550

 

Brookewood Health Care Center

  Decatur   TN         470     4,617         470     4,617     5,087     89     5,060     1981     2011   35 years

7172

 

Tri-State Comp Care Center

  Harrogate   TN         1,520     11,515         1,520     11,515     13,035     195     13,004     1990     2011   35 years

1661

 

Green Acres—Baytown

  Baytown   TX         490     9,104         490     9,104     9,594     153     9,563     1970     2011   35 years

1662

 

Allenbrook Healthcare

  Baytown   TX         470     11,304         470     11,304     11,774     192     11,731     1975     2011   35 years

7603

 

Summer Place Nursing and Rehab

  Beaumont   TX         1,160     15,934         1,160     15,934     17,094     267     17,041     2009     2011   35 years

1664

 

Green Acres—Center

  Center   TX         200     5,446         200     5,446     5,646     102     5,616     1972     2011   35 years

1676

 

Regency Nursing Home

  Clarksville   TX         380     8,711         380     8,711     9,091     156     9,050     1989     2011   35 years

7270

 

Park Manor—Conroe

  Conroe   TX         1,310     22,318         1,310     22,318     23,628     352     23,996     2001     2011   35 years

7601

 

Trisun Care Center Westwood

  Corpus Christi   TX         440     8,624         440     8,624     9,064     148     9,029     1973     2011   35 years

7602

 

Trisun Care Center River Ridge

  Corpus Christi   TX         890     7,695         890     7,695     8,585     141     10,324     1994     2011   35 years

7606

 

Heritage Oaks West

  Corsicana   TX         510     15,806         510     15,806     16,316     264     16,257     1995     2011   35 years

7531

 

Park Manor

  DeSoto   TX         1,080     14,484         1,080     14,484     15,564     248     15,509     1987     2011   35 years

7510

 

Hill Country Care

  Dripping Springs   TX         740     3,973         740     3,973     4,713     74     5,713     1986     2011   35 years

7609

 

Sandstone Ranch

  El Paso   TX         1,580     8,396         1,580     8,396     9,976     213     9,915     2010     2011   35 years

7511

 

Pecan Tree Rehab & Healthcare

  Gainesville   TX         430     11,499         430     11,499     11,929     197     12,587     1990     2011   35 years

1679

 

Pleasant Valley Health & Rehab

  Garland   TX         1,040     9,383         1,040     9,383     10,423     171     11,167     2008     2011   35 years

1674

 

Upshur Manor

  Gilmer   TX         770     8,126         770     8,126     8,896     146     9,475     1990     2011   35 years

1667

 

Beechnut Manor

  Houston   TX         1,080     12,030         1,080     12,030     13,110     211     13,065     1982     2011   35 years

7271

 

Park Manor—Cypress Station

  Houston   TX         1,450     19,542         1,450     19,542     20,992     314     20,941     2003     2011   35 years

7274

 

Park Manor of Westchase

  Houston   TX         2,760     16,715         2,760     16,715     19,475     274     19,444     2005     2011   35 years

7275

 

Park Manor—Cyfair

  Houston   TX         1,720     14,717         1,720     14,717     16,437     242     16,400     1999     2011   35 years

172


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

1666

 

Green Acres—Humble

  Humble   TX         2,060     6,738         2,060     6,738     8,798     129     8,780     1972     2011   35 years

7272

 

Park Manor—Humble

  Humble   TX         1,650     17,257         1,650     17,257     18,907     281     18,862     2003     2011   35 years

1663

 

Green Acres—Huntsville

  Huntsville   TX         290     2,568         290     2,568     2,858     59     3,672     1968     2011   35 years

7512

 

Legend Oaks Healthcare

  Jacksonville   TX         760     9,639         760     9,639     10,399     169     10,361     2006     2011   35 years

7534

 

Avalon Kirbyville

  Kirbyville   TX         260     7,713         260     7,713     7,973     140     7,931     1987     2011   35 years

1678

 

Millbrook Healthcare

  Lancaster   TX         750     7,480         750     7,480     8,230     144     8,551     2008     2011   35 years

1668

 

Nexion Health at Linden

  Linden   TX         680     3,495         680     3,495     4,175     80     4,860     1968     2011   35 years

7535

 

SWLTC Marshall Conroe

  Marshall   TX         810     10,093         810     10,093     10,903     182     10,856     2008     2011   35 years

1677

 

McKinney Healthcare & Rehab

  McKinney   TX         1,450     10,345         1,450     10,345     11,795     185     11,759     2006     2011   35 years

7650

 

Homestead of McKinney

  McKinney   TX         1,540     11,049         1,540     11,049     12,589     195     12,544     1993     2011   35 years

7514

 

Midland Nursing Center

  Midland   TX         530     13,311         530     13,311     13,841     220     13,796     2008     2011   35 years

7273

 

Park Manor of Quail Valley

  Missouri   TX         1,920     16,841         1,920     16,841     18,761     275     18,721     2005     2011   35 years

1672

 

Nexion Health at Mt. Pleasant

  Mount Pleasant   TX         520     5,050         520     5,050     5,570     105     5,863     1970     2011   35 years

1669

 

Nexion Health at New Boston

  New Boston   TX         360     4,718         360     4,718     5,078     98     5,171     1966     2011   35 years

1671

 

Nexion Health at Omaha

  Omaha   TX         450     2,455         450     2,455     2,905     59     3,212     1970     2011   35 years

7604

 

The Meadows Nursing and Rehab

  Orange   TX         380     10,777         380     10,777     11,157     189     11,108     2006     2011   35 years

7607

 

Cypress Glen Nursing and Rehab

  Port Arthur   TX         1,340     14,142         1,340     14,142     15,482     250     15,426     2000     2011   35 years

7608

 

Cypress Glen East

  Port Arthur   TX         490     10,663         490     10,663     11,153     185     11,171     1986     2011   35 years

7600

 

Trisun Care Center Coastal Palms

  Portland   TX         390     8,548         390     8,548     8,938     148     9,426     1998     2011   35 years

7513

 

Legend Oaks Healthcare San Angelo

  San Angelo   TX         870     12,282         870     12,282     13,152     210     13,108     2006     2011   35 years

2472

 

Parklane West

  San Antonio   TX         770     10,242         770     10,242     11,012     183     10,964     1988     2011   35 years

7530

 

San Pedro Manor

  San Antonio   TX         740     11,498         740     11,498     12,238     201     12,188     1986     2011   35 years

1670

 

Nexion Health at Sherman

  Sherman   TX         250     6,636         250     6,636     6,886     125     6,848     1971     2011   35 years

7532

 

Avalon Trinity

  Trinity   TX         330     9,413         330     9,413     9,743     165     9,698     1985     2011   35 years

1673

 

Renfro Nursing Home

  Waxahachie   TX         510     7,602         510     7,602     8,112     148     8,067     1976     2011   35 years

7533

 

Avalon Wharton

  wharton   TX         270     5,107         270     5,107     5,377     104     5,339     1988     2011   35 years

7153

 

Infinia at Granite Hills

  Salt Lake City   UT         740     1,247         740     1,247     1,987     36     1,974     1972     2011   35 years

3769

 

Sleepy Hollow Manor

  Annandale   VA         7,210     13,562         7,210     13,562     20,772     257     22,099     1963     2011   35 years

3768

 

The Cedars Nursing Home

  Charlottesville   VA         2,810     10,763         2,810     10,763     13,573     195     13,553     1964     2011   35 years

7173

 

Avis Adams

  Emporia   VA         620     7,492     16     620     7,508     8,128     140     8,092     1971     2011   35 years

3771

 

Walnut Hill Convalescent Center

  Petersburg   VA         930     11,597         930     11,597     12,527     197     12,491     1972     2011   35 years

3772

 

Battlefield Park Convalescent Center

  Petersburg   VA         1,010     12,489         1,010     12,489     13,499     210     13,463     1976     2011   35 years

7174

 

Twin Oaks

  South Boston   VA         400     2,553         400     2,553     2,953     52     2,939     1966     2011   35 years

1501

 

St. Francis of Bellingham

  Bellingham   WA         1,740     23,581         1,740     23,581     25,321     371     25,286     1984     2011   35 years

7201

 

Evergreen North Cascades

  Bellingham   WA         1,220     7,554         1,220     7,554     8,774     147     10,118     1999     2011   35 years

3924

 

Everett Rehabilitation & Care

  Everett   WA         2,750     27,337         2,750     27,337     30,087     425     29,994     1995     2011   35 years

1514

 

Avamere Georgian Lakewood

  Lakewood   WA         620     3,896         620     3,896     4,516     76     4,500     1958     2011   35 years

3921

 

SunRise Care & Rehab Moses Lake

  Moses Lake   WA         660     17,439         660     17,439     18,099     281     18,045     1972     2011   35 years

3922

 

SunRise Care & Rehab Lake Ridge

  Moses Lake   WA         660     8,866         660     8,866     9,526     149     9,497     1988     2011   35 years

1500

 

Richmond Beach Rehab

  Seattle   WA         2,930     16,199         2,930     16,199     19,129     274     19,134     1993     2011   35 years

1503

 

Avamere Olympic Rehab of Sequim

  Sequim   WA         590     16,896         590     16,896     17,486     276     17,442     1974     2011   35 years

7200

 

Shelton Nursing Home

  Shelton   WA         510     8,570         510     8,570     9,080     145     9,048     1998     2011   35 years

1512

 

Avamere Heritage Rehab of Tacoma

  Tacoma   WA         1,760     4,616         1,760     4,616     6,376     91     6,370     1968     2011   35 years

1515

 

Avamere Skilled Nursing Tacoma

  Tacoma   WA         1,320     1,544         1,320     1,544     2,864     53     2,849     1972     2011   35 years

7360

 

Cascade Park Care Center

  Vancouver   WA         1,860     14,854         1,860     14,854     16,714     239     16,659     1991     2011   35 years

7470

 

Chilton Health and Rehab

  Chilton   WI         440     6,114         440     6,114     6,554     115     6,523     1963     2011   35 years

3781

 

Florence Villa

  Florence   WI         340     5,631         340     5,631     5,971     103     5,945     1970     2011   35 years

3780

 

Western Village

  Green Bay   WI         1,310     4,882         1,310     4,882     6,192     102     7,570     1965     2011   35 years

3783

 

Greendale Health & Rehab

  Sheboygan   WI         880     1,941         880     1,941     2,821     46     3,402     1967     2011   35 years

3782

 

South Shore Manor

  St. Francis   WI         630     2,300         630     2,300     2,930     44     2,923     1960     2011   35 years

7240

 

Waukesha Springs (Westmoreland)

  Waukesha   WI         1,380     16,205         1,380     16,205     17,585     296     17,498     1973     2011   35 years

3776

 

Wisconsin Dells Health & Rehab

  Wisconsin Dells   WI         730     18,994         730     18,994     19,724     298     19,680     1972     2011   35 years

2513

 

Logan Center

  Logan   WV         300     12,959         300     12,959     13,259     204     13,220     1987     2011   35 years

2514

 

Ravenswood Healthcare Center

  Ravenswood   WV         320     12,710         320     12,710     13,030     200     12,992     1987     2011   35 years

2512

 

Valley Center

  South Charleston   WV         750     24,115         750     24,115     24,865     384     24,789     1987     2011   35 years

2515

 

White Sulphur

  White Sulphur   WV         250     13,055         250     13,055     13,305     207     13,263     1987     2011   35 years
                                                                 

 

TOTAL NON-KINDRED SKILLED NURSING FACILITIES

                216,234     2,093,287     2,299     216,234     2,095,586     2,311,820     77,131     2,317,306                

 

TOTAL FOR SKILLED NURSING FACILITIES

           
   
266,968
   
2,637,598
   
1,919
   
266,588
   
2,639,897
   
2,906,485
   
460,144
   
2,528,958
               

173


Table of Contents

 
   
   
   
   
   
   
   
  Gross Amount Carried
at Close of Period
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
   
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

 

KINDRED HOSPITALS

                                                                             

4656

 

Kindred Hospital—Arizona—Phoenix

  Phoenix   AZ         226     3,359         226     3,359     3,585     2,320     1,265     1980     1992   30 years

4826

 

Kindred Hospital—Scottsdale

  Scottsdale   AZ         2,310     6,322         2,310     6,322     8,632     107     10,142     1986     2011   35 years

4658

 

Kindred Hospital—Tucson

  Tucson   AZ         130     3,091         130     3,091     3,221     2,565     656     1969     1994   25 years

4644

 

Kindred Hospital—Brea

  Brea   CA         3,144     2,611         3,144     2,611     5,755     1,049     4,706     1990     1995   40 years

4807

 

Kindred Hospital—Ontario

  Ontario   CA         523     2,988         523     2,988     3,511     2,433     1,078     1950     1994   25 years

4848

 

Kindred Hospital—San Diego

  San Diego   CA         670     11,764         670     11,764     12,434     9,987     2,447     1965     1994   25 years

4822

 

Kindred Hospital—San Francisco Bay Area

  San Leandro   CA         2,735     5,870         2,735     5,870     8,605     5,711     2,894     1962     1993   25 years

4842

 

Kindred Hospital—Westminster

  Westminster   CA         727     7,384         727     7,384     8,111     7,055     1,056     1973     1993   20 years

4665

 

Kindred Hospital—Denver

  Denver   CO         896     6,367         896     6,367     7,263     6,051     1,212     1963     1994   20 years

4602

 

Kindred Hospital—South Florida—Coral Gables

  Coral Gables   FL         1,071     5,348         1,071     5,348     6,419     4,435     1,984     1956     1992   30 years

4645

 

Kindred Hospital—South Florida Ft. Lauderdale

  Ft. Lauderdale   FL         1,758     14,080         1,758     14,080     15,838     11,939     3,899     N/A     1989   30 years

4652

 

Kindred Hospital—North Florida

  Green Cove Springs   FL         145     4,613         145     4,613     4,758     3,745     1,013     1956     1994   20 years

4876

 

Kindred Hospital—South Florida—Hollywood

  Hollywood   FL         605     5,229         605     5,229     5,834     4,639     1,195     1937     1995   20 years

4674

 

Kindred Hospital—Central Tampa

  Tampa   FL         2,732     7,676         2,732     7,676     10,408     4,080     6,328     1970     1993   40 years

4611

 

Kindred Hospital—Bay Area St. Petersburg

  St. Petersburg   FL         1,401     16,706         1,401     16,706     18,107     12,144     5,963     1968     1997   40 years

4637

 

Kindred Hospital—Chicago (North Campus)

  Chicago   IL         1,583     19,980         1,583     19,980     21,563     16,508     5,055     1949     1995   25 years

4871

 

Kindred—Chicago—Lakeshore

  Chicago   IL         1,513     9,525         1,513     9,525     11,038     9,253     1,785     1995     1976   20 years

4690

 

Kindred Hospital—Chicago (Northlake Campus)

  Northlake   IL         850     6,498         850     6,498     7,348     4,974     2,374     1960     1991   30 years

4615

 

Kindred Hospital—Sycamore

  Sycamore   IL         77     8,549         77     8,549     8,626     6,632     1,994     1949     1993   20 years

4638

 

Kindred Hospital—Indianapolis

  Indianapolis   IN         985     3,801         985     3,801     4,786     2,900     1,886     1955     1993   30 years

4633

 

Kindred Hospital—Louisville

  Louisville   KY         3,041     12,279         3,041     12,279     15,320     10,676     4,644     1964     1995   20 years

4666

 

Kindred Hospital—New Orleans

  New Orleans   LA         648     4,971         648     4,971     5,619     3,892     1,727     1968     1978   20 years

4688

 

Kindred Hospital—Boston

  Boston   MA         1,551     9,796         1,551     9,796     11,347     8,438     2,909     1930     1994   25 years

4673

 

Kindred Hospital—Boston North Shore

  Peabody   MA         543     7,568         543     7,568     8,111     4,660     3,451     1974     1993   40 years

4612

 

Kindred Hospital—Kansas City

  Kansas City   MO         277     2,914         277     2,914     3,191     2,321     870     N/A     1992   30 years

4680

 

Kindred Hospital—St. Louis

  St Louis   MO         1,126     2,087         1,126     2,087     3,213     1,668     1,545     1984     1991   40 years

4662

 

Kindred Hospital—Greensboro

  Greensboro   NC         1,010     7,586         1,010     7,586     8,596     6,698     1,898     1964     1994   20 years

4664

 

Kindred Hospital—Albuquerque

  Albuquerque   NM         11     4,253         11     4,253     4,264     2,306     1,958     1985     1993   40 years

4647

 

Kindred Hospital—Las Vegas (Sahara)

  Las Vegas   NV         1,110     2,177         1,110     2,177     3,287     1,100     2,187     1980     1994   40 years

4618

 

Kindred Hospital—Oklahoma City

  Oklahoma City   OK         293     5,607         293     5,607     5,900     3,820     2,080     1958     1993   30 years

4619

 

Kindred Hospital—Pittsburgh

  Oakdale   PA         662     12,854         662     12,854     13,516     8,027     5,489     1972     1996   40 years

4614

 

Kindred Hospital—Philadelphia

  Philadelphia   PA         135     5,223         135     5,223     5,358     2,626     2,732     N/A     1995   35 years

4628

 

Kindred Hospital—Chattanooga

  Chattanooga   TN         756     4,415         756     4,415     5,171     3,527     1,644     1975     1993   22 years

4653

 

Kindred Hospital—Tarrant County (Fort Worth Southwest)

  Ft. Worth   TX         2,342     7,458         2,342     7,458     9,800     6,929     2,871     1987     1986   20 years

4668

 

Kindred Hospital—Fort Worth

  Ft. Worth   TX         648     10,608         648     10,608     11,256     7,595     3,661     1960     1994   34 years

4654

 

Kindred Hospital (Houston Northwest)

  Houston   TX         1,699     6,788         1,699     6,788     8,487     4,415     4,072     1986     1985   40 years

4685

 

Kindred Hospital—Houston

  Houston   TX         33     7,062         33     7,062     7,095     5,768     1,327     N/A     1994   20 years

4660

 

Kindred Hospital—Mansfield

  Mansfield   TX         267     2,462         267     2,462     2,729     1,651     1,078     1983     1990   40 years

4635

 

Kindred Hospital—San Antonio

  San Antonio   TX         249     11,413         249     11,413     11,662     7,329     4,333     1981     1993   30 years
                                                                 

 

TOTAL FOR KINDRED HOSPITALS

                40,482     279,282         40,482     279,282     319,764     211,973     109,408                

174


Table of Contents

 
   
   
   
   
   
   
   
  Gross Amount Carried
at Close of Period
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
   
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

 

NON-KINDRED HOSPITALS

                                                                             

7280

 

Southern Arizone Rehab

  Tucson   AZ         770     25,589         770     25,589     26,359     382     26,335     1992     2011   35 years

7403

 

HealthBridge Children's Hospital

  Orange   CA         1,330     9,317         1,330     9,317     10,647     143     10,640     2000     2011   35 years

7281

 

HealthSouth Rehabilitation Hospital

  Tustin   CA         2,810     25,248         2,810     25,248     28,058     384     31,125     1991     2011   35 years

3828

 

Gateway Rehabilitation Hospital at Florence

  Florence   KY         3,600     4,924         3,600     4,924     8,524     727     7,797     2001     2006   35 years

7400

 

The Ranch/Touchstone

  Conroe   TX         2,710     28,428         2,710     28,428     31,138     425     31,124     1992     2011   35 years

3864

 

Highlands Regional Rehabilitation Hospital

  El Paso   TX         1,900     23,616         1,900     23,616     25,516     3,486     22,030     1999     2006   35 years

7401

 

Houston Children's Hospital

  Houston   TX         1,800     15,770         1,800     15,770     17,570     239     17,563     1999     2011   35 years

7402

 

Beacon Specialty Hospital

  The Woodlands   TX         960     6,498         960     6,498     7,458     101     7,455     1995     2011   35 years
                                                                 

 

TOTAL FOR NON-KINDRED HOSPITALS

                15,880     139,390         15,880     139,390     155,270     5,887     154,069                

 

TOTAL FOR HOSPITALS

           
   
56,362
   
418,672
   
   
56,362
   
418,672
   
475,034
   
217,860
   
263,477
               

 

BROOKDALE SENIORS HOUSING COMMUNITIES

                                                                             

2445

 

Cedar Springs (aka Decatur)

  Decatur   AL         1,960     7,916         1,960     7,916     9,876     163     9,793     1987     2011   35 years

2444

 

Hanceville

  Hanceville   AL         530     3,822         530     3,822     4,352     69     4,451     1996     2011   35 years

2477

 

Wellington Place at Muscle Shoals

  Muscle Shoals   AL         340     4,017         340     4,017     4,357     73     5,245     1999     2011   35 years

2466

 

Sterling House of Chandler

  Chandler   AZ         2,000     6,538         2,000     6,538     8,538     112     8,505     1998     2011   35 years

2471

 

Park Regency Premier Club

  Chandler   AZ         2,260     19,338         2,260     19,338     21,598     362     22,612     1992     2011   35 years

2424

 

The Springs of East Mesa

  Mesa   AZ         2,747     24,918         2,747     24,918     27,665     7,012     20,653     1986     2005   35 years

3219

 

Sterling House of Mesa

  Mesa   AZ         655     6,998         655     6,998     7,653     1,942     5,711     1998     2005   35 years

3225

 

Clare Bridge of Oro Valley

  Oro Valley   AZ         666     6,169         666     6,169     6,835     1,711     5,124     1998     2005   35 years

3227

 

Sterling House of Peoria

  Peoria   AZ         598     4,872         598     4,872     5,470     1,352     4,118     1998     2005   35 years

3236

 

Clare Bridge of Tempe

  Tempe   AZ         611     4,066         611     4,066     4,677     1,128     3,549     1997     2005   35 years

3238

 

Sterling House on East Speedway

  Tucson   AZ         506     4,745         506     4,745     5,251     1,316     3,935     1998     2005   35 years

2426

 

Woodside Terrace

  Redwood City   CA         7,669     66,691         7,669     66,691     74,360     19,035     55,325     1988     2005   35 years

2428

 

The Atrium

  San Jose   CA     24,194     6,240     66,329         6,240     66,329     72,569     17,758     54,811     1987     2005   35 years

2429

 

Brookdale Place

  San Marcos   CA         4,288     36,204         4,288     36,204     40,492     10,439     30,053     1987     2005   35 years

2438

 

Ridge Point Assisted Living Inn

  Boulder   CO         1,290     20,683         1,290     20,683     21,973     329     21,847     1985     2011   35 years

3206

 

Wynwood of Colorado Springs

  Colorado Springs   CO         715     9,279         715     9,279     9,994     2,574     7,420     1997     2005   35 years

2470

 

Heritage Club at Denver

  Denver   CO     24,038     1,680     91,751         1,680     91,751     93,431     1,380     92,804     1987     2011   35 years

3220

 

Wynwood of Pueblo

  Pueblo   CO     5,207     840     9,403         840     9,403     10,243     2,609     7,634     1997     2005   35 years

2420

 

The Gables at Farmington

  Farmington   CT     10,160     3,995     36,310         3,995     36,310     40,305     10,211     30,094     1984     2005   35 years

2435

 

Chatfield

  West Hartford   CT         2,493     22,833         2,493     22,833     25,326     6,405     18,921     1989     2005   35 years

3258

 

Clare Bridge of Ft. Myers

  Ft. Myers   FL         1,510     7,862         1,510     7,862     9,372     124     10,086     1996     2011   35 years

2478

 

Wellington Place at Ft Walton

  Ft. Walton   FL         2,610     11,041         2,610     11,041     13,651     174     13,592     2000     2011   35 years

2458

 

Sterling House of Merrimac

  Jacksonville   FL         860     16,745         860     16,745     17,605     254     17,513     1997     2011   35 years

3260

 

Clare Bridge of Jacksonville

  Jacksonville   FL         1,300     9,659         1,300     9,659     10,959     151     10,908     1997     2011   35 years

3284

 

Clare Bridge of Leesburg

  Leesburg   FL         1,050     8,140         1,050     8,140     9,190     128     9,115     1999     2011   35 years

3259

 

Sterling House of Ormond Beach

  Ormond Beach   FL         1,660     9,738         1,660     9,738     11,398     153     11,349     1997     2011   35 years

2460

 

Sterling House of Palm Coast

  Palm Coast   FL         470     9,187         470     9,187     9,657     146     9,600     1997     2011   35 years

3226

 

Sterling House of Pensacola

  Pensacola   FL         633     6,087         633     6,087     6,720     1,689     5,031     1998     2005   35 years

175


Table of Contents

 
   
   
   
   
   
   
   
  Gross Amount Carried
at Close of Period
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
   
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

2461

 

Sterling House of Englewood (FL)

  Rotunda West   FL         1,740     4,331         1,740     4,331     6,071     83     6,102     1997     2011   35 years

3235

 

Clare Bridge of Tallahassee

  Tallahassee   FL     4,624     667     6,168         667     6,168     6,835     1,711     5,124     1998     2005   35 years

2452

 

Sterling House of Tavares

  Tavares   FL         280     15,980         280     15,980     16,260     243     16,167     1997     2011   35 years

2469

 

Renaissance of Titusville

  Titusville   FL         2,330     9,435         2,330     9,435     11,765     176     11,872     1987     2011   35 years

3241

 

Clare Bridge of West Melbourne

  West Melbourne   FL     6,589     586     5,481         586     5,481     6,067     1,521     4,546     2000     2005   35 years

2436

 

The Classic at West Palm Beach

  West Palm Beach   FL     26,100     3,758     33,072         3,758     33,072     36,830     9,402     27,428     1990     2005   35 years

3245

 

Clare Bridge Cottage of Winter Haven

  Winter Haven   FL         232     3,006         232     3,006     3,238     834     2,404     1997     2005   35 years

3246

 

Sterling House of Winter Haven

  Winter Haven   FL         438     5,549         438     5,549     5,987     1,540     4,447     1997     2005   35 years

3239

 

Wynwood of Twin Falls

  Twin Falls   ID         703     6,153         703     6,153     6,856     1,707     5,149     1997     2005   35 years

2416

 

The Hallmark

  Chicago   IL         11,057     107,517         11,057     107,517     118,574     29,582     88,992     1990     2005   35 years

2417

 

The Kenwood of Lake View

  Chicago   IL     11,472     3,072     26,668         3,072     26,668     29,740     7,617     22,123     1950     2005   35 years

2418

 

The Heritage

  Des Plaines   IL     32,000     6,871     60,165         6,871     60,165     67,036     17,133     49,903     1993     2005   35 years

2421

 

Devonshire of Hoffman Estates

  Hoffman Estates   IL         3,886     44,130         3,886     44,130     48,016     11,590     36,426     1987     2005   35 years

2423

 

The Devonshire

  Lisle   IL     33,000     7,953     70,400         7,953     70,400     78,353     19,973     58,380     1990     2005   35 years

2415

 

Seasons at Glenview

  Northbrook   IL         1,988     39,762         1,988     39,762     41,750     9,303     32,447     1999     2004   35 years

2432

 

Hawthorn Lakes

  Vernon Hills   IL         4,439     35,044         4,439     35,044     39,483     10,349     29,134     1987     2005   35 years

2433

 

The Willows

  Vernon Hills   IL         1,147     10,041         1,147     10,041     11,188     2,859     8,329     1999     2005   35 years

3209

 

Sterling House of Evansville

  Evansville   IN     3,709     357     3,765         357     3,765     4,122     1,044     3,078     1998     2005   35 years

2422

 

Berkshire of Castleton

  Indianapolis   IN         1,280     11,515         1,280     11,515     12,795     3,249     9,546     1986     2005   35 years

3218

 

Sterling House of Marion

  Marion   IN         207     3,570         207     3,570     3,777     990     2,787     1998     2005   35 years

3285

 

Sterling House of Michigan City

  Michigan City   IN         530     4,007         530     4,007     4,537     74     4,680     1998     2011   35 years

3286

 

Clare Bridge of Michigan City

  Michigan City   IN         510     2,632         510     2,632     3,142     54     3,266     1999     2011   35 years

3230

 

Sterling House of Portage

  Portage   IN         128     3,649         128     3,649     3,777     1,012     2,765     1999     2005   35 years

3232

 

Sterling House of Richmond

  Richmond   IN         495     4,124         495     4,124     4,619     1,144     3,475     1998     2005   35 years

3273

 

Sterling House of Derby

  Derby   KS         440     4,422         440     4,422     4,862     72     4,835     1994     2011   35 years

3216

 

Clare Bridge of Leawood

  Leawood   KS     3,778     117     5,127         117     5,127     5,244     1,422     3,822     2000     2005   35 years

2451

 

Sterling House of Salina II

  Salina   KS         300     5,657         300     5,657     5,957     92     5,920     1996     2011   35 years

3237

 

Clare Bridge Cottage of Topeka

  Topeka   KS     5,059     370     6,825         370     6,825     7,195     1,893     5,302     2000     2005   35 years

3274

 

Sterling House of Wellington

  Wellington   KS         310     2,434         310     2,434     2,744     43     2,727     1994     2011   35 years

2425

 

River Bay Club

  Quincy   MA         6,101     57,862         6,101     57,862     63,963     16,048     47,915     1986     2005   35 years

3252

 

Woven Hearts of Davison

  Davidson   MI         160     3,189         160     3,189     3,349     53     3,370     1997     2011   35 years

3253

 

Clare Bridge of Delta Charter

  Delta   MI         730     11,471         730     11,471     12,201     178     12,135     1998     2011   35 years

3257

 

Woven Hearts of Delta Charter

  Delta   MI         820     3,313         820     3,313     4,133     72     4,099     1998     2011   35 years

3247

 

Clare Bridge of Farmington Hills I

  Farmington Hills   MI         580     10,497         580     10,497     11,077     183     10,995     1994     2011   35 years

3248

 

Clare Bridge of Farmington Hills II

  Farmington Hills   MI         700     10,246         700     10,246     10,946     186     10,860     1994     2011   35 years

3254

 

Clare Bridge of Grand Blanc I

  Grand Blanc   MI         450     12,373         450     12,373     12,823     193     12,747     1998     2011   35 years

3255

 

Wynwood of Grand Blanc II

  Grand Blanc   MI         620     14,627         620     14,627     15,247     231     15,156     1998     2011   35 years

3250

 

Wynwood of Meridian Lansing II

  Haslett   MI         1,340     6,134         1,340     6,134     7,474     108     7,847     1998     2011   35 years

3224

 

Wynwood of Northville

  Northville   MI     7,439     407     6,068         407     6,068     6,475     1,684     4,791     1996     2005   35 years

3251

 

Clare Bridge of Troy I

  Troy   MI         630     17,178         630     17,178     17,808     264     17,707     1998     2011   35 years

3256

 

Wynwood of Troy II

  Troy   MI         950     12,503         950     12,503     13,453     207     14,589     1998     2011   35 years

3240

 

Wynwood of Utica

  Utica   MI         1,142     11,808         1,142     11,808     12,950     3,276     9,674     1996     2005   35 years

3249

 

Clare Bridge of Utica

  Utica   MI         700     8,657         700     8,657     9,357     143     9,973     1995     2011   35 years

3203

 

Sterling House of Blaine

  Blaine   MN         150     1,675         150     1,675     1,825     465     1,360     1997     2005   35 years

3208

 

Clare Bridge of Eden Prairie

  Eden Prairie   MN         301     6,228         301     6,228     6,529     1,728     4,801     1998     2005   35 years

176


Table of Contents

 
   
   
   
   
   
   
   
  Gross Amount Carried
at Close of Period
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
   
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

2419

 

Edina Park Plaza

  Edina   MN     16,348     3,621     33,141         3,621     33,141     36,762     9,299     27,463     1998     2005   35 years

3270

 

Woven Hearts of Faribault

  Faribault   MN         530     1,085         530     1,085     1,615     22     1,985     1997     2011   35 years

3211

 

Sterling House of Inver Grove Heights

  Inver Grove Heights   MN     2,914     253     2,655         253     2,655     2,908     737     2,171     1997     2005   35 years

3265

 

Woven Hearts of Mankato

  Mankato   MN         490     410         490     410     900     16     1,343     1996     2011   35 years

3223

 

Clare Bridge of North Oaks

  North Oaks   MN         1,057     8,296         1,057     8,296     9,353     2,301     7,052     1998     2005   35 years

3287

 

Sterling House of Owatonna

  Owatonna   MN         440     445         440     445     885     14     1,011     1996     2011   35 years

3288

 

Clare Bridge of Owatonna

  Owatonna   MN         550     1,189         550     1,189     1,739     26     1,868     1999     2011   35 years

3229

 

Clare Bridge of Plymouth

  Plymouth   MN         679     8,675         679     8,675     9,354     2,407     6,947     1998     2005   35 years

3272

 

Woven Hearts of Sauk Rapids

  Sauk Rapids   MN         480     3,178         480     3,178     3,658     53     3,638     1997     2011   35 years

3269

 

Woven Hearts of Wilmar

  Wilmar   MN         470     4,833         470     4,833     5,303     76     5,275     1997     2011   35 years

3267

 

Woven Hearts of Winona

  Winona   MN         800     1,390         800     1,390     2,190     45     2,432     1997     2011   35 years

2476

 

Wellington Place of Greenville

  Greenville   MS         600     1,522         600     1,522     2,122     37     2,981     1999     2011   35 years

3204

 

Clare Bridge of Cary

  Cary   NC         724     6,466         724     6,466     7,190     1,794     5,396     1997     2005   35 years

2465

 

Sterling House of Hickory

  Hickory   NC         330     10,981         330     10,981     11,311     171     11,244     1997     2011   35 years

3244

 

Clare Bridge of Winston-Salem

  Winston-Salem   NC         368     3,497         368     3,497     3,865     970     2,895     1997     2005   35 years

2468

 

Sterling House of Deptford

  Deptford   NJ         1,190     5,482         1,190     5,482     6,672     95     7,662     1998     2011   35 years

2434

 

Brendenwood

  Voorhees   NJ     18,180     3,158     29,909         3,158     29,909     33,067     8,298     24,769     1987     2005   35 years

3242

 

Clare Bridge of Westampton

  Westampton   NJ         881     4,741         881     4,741     5,622     1,315     4,307     1997     2005   35 years

2430

 

Ponce de Leon

  Santa Fe   NM             28,178             28,178     28,178     7,516     20,662     1986     2005   35 years

2462

 

Westwood Assisted Living

  Sparks   NV         1,040     7,376         1,040     7,376     8,416     120     8,876     1991     2011   35 years

2463

 

Westwood Active Retirement

  Sparks   NV         1,520     9,280         1,520     9,280     10,800     155     11,612     1993     2011   35 years

3205

 

Villas of Sherman Brook

  Clinton   NY         947     7,528         947     7,528     8,475     2,088     6,387     1991     2005   35 years

3212

 

Wynwood of Kenmore

  Kenmore   NY     13,871     1,487     15,170         1,487     15,170     16,657     4,209     12,448     1995     2005   35 years

3261

 

Wynwood of Liberty (Manlius)

  Manlius   NY         890     28,237         890     28,237     29,127     430     28,952     1994     2011   35 years

3221

 

Clare Bridge of Niskayuna

  Niskayuna   NY         1,021     8,333         1,021     8,333     9,354     2,312     7,042     1997     2005   35 years

3222

 

Wynwood of Niskayuna

  Niskayuna   NY     17,473     1,884     16,103         1,884     16,103     17,987     4,467     13,520     1996     2005   35 years

3228

 

Clare Bridge of Perinton

  Pittsford   NY         611     4,066         611     4,066     4,677     1,128     3,549     1997     2005   35 years

2427

 

The Gables at Brighton

  Rochester   NY         1,131     9,498         1,131     9,498     10,629     2,744     7,885     1988     2005   35 years

3234

 

Villas of Summerfield

  Syracuse   NY         1,132     11,434         1,132     11,434     12,566     3,172     9,394     1991     2005   35 years

3243

 

Clare Bridge of Williamsville

  Williamsville   NY     7,171     839     3,841         839     3,841     4,680     1,066     3,614     1997     2005   35 years

3200

 

Sterling House of Alliance

  Alliance   OH     2,372     392     6,283         392     6,283     6,675     1,743     4,932     1998     2005   35 years

3201

 

Clare Bridge Cottage of Austintown

  Austintown   OH         151     3,087         151     3,087     3,238     856     2,382     1999     2005   35 years

3275

 

Sterling House of Barberton

  Barberton   OH         440     10,884         440     10,884     11,324     169     11,259     1997     2011   35 years

3202

 

Sterling House of Beaver Creek

  Beavercreek   OH         587     5,381         587     5,381     5,968     1,493     4,475     1998     2005   35 years

3207

 

Sterling House of Westerville

  Columbus   OH     1,929     267     3,600         267     3,600     3,867     999     2,868     1999     2005   35 years

3276

 

Sterling House of Englewood (OH)

  Englewood   OH         630     6,477         630     6,477     7,107     106     7,066     1997     2011   35 years

177


Table of Contents

 
   
   
   
   
   
   
   
  Gross Amount Carried
at Close of Period
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
   
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

2455

 

Sterling House of Greenville

  Greenville   OH         490     4,144         490     4,144     4,634     80     6,130     1997     2011   35 years

2467

 

Sterling House of Lancaster

  Lancaster   OH         460     4,662         460     4,662     5,122     81     5,339     1998     2011   35 years

3277

 

Sterling House of Marion

  Marion   OH         620     3,306         620     3,306     3,926     62     4,420     1998     2011   35 years

3233

 

Sterling House of Salem

  Salem   OH         634     4,659         634     4,659     5,293     1,292     4,001     1998     2005   35 years

2459

 

Sterling House of Springdale

  Springdale   OH         1,140     9,134         1,140     9,134     10,274     144     10,224     1997     2011   35 years

3278

 

Sterling House of Bartlesville

  Bartlesville   OK         250     10,529         250     10,529     10,779     161     10,717     1997     2011   35 years

3279

 

Sterling House of Bethany

  Bethany   OK         390     1,499         390     1,499     1,889     30     1,994     1994     2011   35 years

2450

 

Sterling House of Broken Arrow

  Broken Arrow   OK         940     6,312         940     6,312     7,252     101     7,218     1996     2011   35 years

3289

 

Clare Bridge of Beaverton

  Beaverton   OR         3,280     20,590         3,280     20,590     23,870     312     23,697     2000     2011   35 years

3290

 

Clare Bridge of Bend

  Bend   OR         1,800     14,443         1,800     14,443     16,243     225     16,112     2001     2011   35 years

2439

 

Forest Grove Residential Community

  Forest Grove   OR         2,320     9,633         2,320     9,633     11,953     168     11,894     1994     2011   35 years

2440

 

The Heritage at Mt. Hood

  Gresham   OR         2,410     9,093         2,410     9,093     11,503     159     11,449     1988     2011   35 years

2441

 

McMinnville Residential Estates

  McMinnville   OR     2,328     1,230     7,561         1,230     7,561     8,791     146     8,726     1989     2011   35 years

3291

 

Clare Bridge of Troutdale

  Troutdale   OR         1,400     9,501         1,400     9,501     10,901     154     10,818     2000     2011   35 years

3292

 

Clare Bridge of Dublin

  Dublin   PA         1,010     7,249         1,010     7,249     8,259     114     8,193     1998     2011   35 years

2475

 

Homewood Residence at Deane Hill

  Knoxville   TN         1,150     15,705         1,150     15,705     16,855     263     16,745     2001     2011   35 years

2479

 

Wellington Place at Newport

  Newport   TN         820     4,046         820     4,046     4,866     74     5,452     2000     2011   35 years

2449

 

Trinity Towers

  Corpus Christi   TX         1,920     71,661         1,920     71,661     73,581     1,116     73,162     1985     2011   35 years

2446

 

Sterling House of Denton

  Denton   TX         1,750     6,712         1,750     6,712     8,462     108     8,432     1996     2011   35 years

2448

 

Sterling House of Ennis

  Ennis   TX         460     3,284         460     3,284     3,744     58     3,843     1996     2011   35 years

2474

 

Broadway Plaza at Westover Hill

  Ft. Worth   TX         1,660     25,703         1,660     25,703     27,363     399     27,213     2001     2011   35 years

2453

 

Hampton at Pearland

  Houston   TX         1,250     12,869         1,250     12,869     14,119     214     14,550     1998     2011   35 years

2454

 

Hampton at Pinegate

  Houston   TX         3,440     15,913         3,440     15,913     19,353     261     19,267     1998     2011   35 years

2456

 

Hampton at Shadowlake

  Houston   TX         2,520     13,770         2,520     13,770     16,290     231     16,996     1999     2011   35 years

2457

 

Hampton at Spring Shadow

  Houston   TX         1,250     15,760         1,250     15,760     17,010     251     16,914     1999     2011   35 years

3280

 

Sterling House of Kerrville

  Kerrville   TX         460     8,548         460     8,548     9,008     133     8,957     1997     2011   35 years

3281

 

Sterling House of Lancaster

  Lancaster   TX         410     1,478         410     1,478     1,888     33     2,745     1997     2011   35 years

2447

 

Sterling House of Paris

  Paris   TX         360     2,411         360     2,411     2,771     46     3,316     1996     2011   35 years

3282

 

Sterling House of San Antonio

  San Antonio   TX         1,400     10,051         1,400     10,051     11,451     159     11,397     1997     2011   35 years

3283

 

Sterling House of Temple

  Temple   TX         330     5,081         330     5,081     5,411     86     5,374     1997     2011   35 years

3217

 

Clare Bridge of Lynwood

  Lynwood   WA         1,219     9,573         1,219     9,573     10,792     2,656     8,136     1999     2005   35 years

3231

 

Clare Bridge of Puyallup

  Puyallup   WA     10,110     1,055     8,298         1,055     8,298     9,353     2,302     7,051     1998     2005   35 years

2442

 

Columbia Edgewater

  Richland   WA         960     23,270         960     23,270     24,230     373     24,080     1990     2011   35 years

2431

 

Park Place

  Spokane   WA         1,622     12,895         1,622     12,895     14,517     3,798     10,719     1915     2005   35 years

2443

 

Crossings at Allenmore

  Tacoma   WA         620     16,186         620     16,186     16,806     251     16,703     1997     2011   35 years

2473

 

Union Park at Allenmore

  Tacoma   WA         1,710     3,326         1,710     3,326     5,036     84     7,992     1988     2011   35 years

2464

 

Crossings at Yakima

  Yakima   WA         860     15,276         860     15,276     16,136     244     16,041     1998     2011   35 years

3210

 

Sterling House of Fond du Lac

  Fond du Lac   WI         196     1,603         196     1,603     1,799     445     1,354     2000     2005   35 years

3213

 

Clare Bridge of Kenosha

  Kenosha   WI         551     5,431     2,772     551     8,203     8,754     1,773     6,981     2000     2005   35 years

3271

 

Woven Hearts of Kenosha

  Kenosha   WI         630     1,694         630     1,694     2,324     31     2,314     1997     2011   35 years

3214

 

Clare Bridge Cottage of La Crosse

  LaCrosse   WI         621     4,056     1,126     621     5,182     5,803     1,234     4,569     2004     2005   35 years

3215

 

Sterling House of La Crosse

  LaCrosse   WI         644     5,831     2,637     644     8,468     9,112     1,873     7,239     1998     2005   35 years

3268

 

Sterling House of Middleton

  Middleton   WI         360     5,041         360     5,041     5,401     79     5,371     1997     2011   35 years

3263

 

Woven Hearts of Neenah

  Neenah   WI         340     1,030         340     1,030     1,370     22     1,904     1996     2011   35 years

3262

 

Woven Hearts of Onalaska

  Onalaska   WI         250     4,949         250     4,949     5,199     77     5,233     1995     2011   35 years

3266

 

Woven Hearts of Oshkosh

  Oshkosh   WI         160     1,904         160     1,904     2,064     34     2,049     1996     2011   35 years

3264

 

Woven Hearts of Sun Prairie

  Sun Prairie   WI         350     1,131         350     1,131     1,481     23     1,471     1994     2011   35 years
                                                                 

 

TOTAL FOR BROOKDALE SENIORS HOUSING COMMUNITIES

            290,065     205,440     2,035,251     6,535     205,440     2,041,786     2,247,226     334,939     1,940,858                

178


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

 

SUNRISE SENIORS HOUSING COMMUNITIES

                                                                             

4064

 

Sunrise of Scottsdale

  Scottsdale   AZ         2,229     27,575     175     2,238     27,741     29,979     3,990     25,989     2007     2007   35 years

4012

 

Sunrise of Sunnyvale

  Sunnyvale   CA         2,933     34,361     305     2,933     34,666     37,599     5,085     32,514     2000     2007   35 years

4016

 

Sunrise of Westlake Village

  Westlake Village   CA         4,935     30,722     340     4,943     31,054     35,997     4,464     31,533     2004     2007   35 years

4018

 

Sunrise at Yorba Linda

  Yorba Linda   CA         1,689     25,240     289     1,689     25,529     27,218     3,675     23,543     2002     2007   35 years

4023

 

Sunrise at La Costa

  Carlsbad   CA         4,890     20,590     493     4,898     21,075     25,973     3,650     22,323     1999     2007   35 years

4035

 

Sunrise of San Mateo

  San Mateo   CA         2,682     35,335     1,017     2,682     36,352     39,034     5,104     33,930     1999     2007   35 years

4043

 

Sunrise at Canyon Crest

  Riverside   CA     12,064     5,486     19,658     651     5,505     20,290     25,795     3,302     22,493     2006     2007   35 years

4045

 

Sunrise of Mission Viejo

  Mission Viejo   CA     11,182     3,802     24,560     430     3,812     24,980     28,792     3,990     24,802     1998     2007   35 years

4047

 

Sunrise of Pacific Palisades

  Pacific Palisades   CA     8,039     4,458     17,064     392     4,458     17,456     21,914     2,987     18,927     2001     2007   35 years

4050

 

Sunrise at Sterling Canyon

  Valencia   CA     18,045     3,868     29,293     3,157     3,914     32,404     36,318     4,901     31,417     1998     2007   35 years

4055

 

Sunrise of Fair Oaks

  Fair Oaks   CA     11,434     1,456     23,679     1,008     2,166     23,977     26,143     3,834     22,309     2001     2007   35 years

4066

 

Sunrise of Rocklin

  Rocklin   CA         1,378     23,565     311     1,397     23,857     25,254     3,488     21,766     2007     2007   35 years

4009

 

Sunrise at Cherry Creek

  Denver   CO         1,621     28,370     505     1,621     28,875     30,496     4,301     26,195     2000     2007   35 years

4030

 

Sunrise at Pinehurst

  Denver   CO         1,417     30,885     632     1,417     31,517     32,934     5,060     27,874     1998     2007   35 years

4059

 

Sunrise at Orchard

  Littleton   CO     11,358     1,813     22,183     560     1,813     22,743     24,556     3,642     20,914     1997     2007   35 years

4061

 

Sunrise of Westminster

  Westminster   CO     8,131     2,649     16,243     430     2,675     16,647     19,322     2,772     16,550     2000     2007   35 years

4028

 

Sunrise of Stamford

  Stamford   CT         4,612     28,533     805     4,612     29,338     33,950     4,664     29,286     1999     2007   35 years

4053

 

Sunrise at East Cobb

  Marietta   GA     10,207     1,797     23,420     395     1,798     23,814     25,612     3,682     21,930     1997     2007   35 years

4056

 

Sunrise of Huntcliff I

  Atlanta   GA     33,035     4,232     66,161     4,245     4,240     70,398     74,638     10,196     64,442     1987     2007   35 years

4057

 

Sunrise of Huntcliff II

  Atlanta   GA     5,321     2,154     17,137     444     2,154     17,581     19,735     2,727     17,008     1998     2007   35 years

4058

 

Sunrise of Ivey Ridge

  Alpharetta   GA     5,540     1,507     18,516     528     1,507     19,044     20,551     3,098     17,453     1998     2007   35 years

4014

 

Sunrise of Park Ridge

  Park Ridge   IL         5,533     39,557     399     5,547     39,942     45,489     5,876     39,613     1998     2007   35 years

4015

 

Sunrise of Lincoln Park

  Chicago   IL         3,485     26,687     190     3,485     26,877     30,362     3,800     26,562     2003     2007   35 years

4021

 

Sunrise of Glen Ellyn

  Glen Ellyn   IL         2,455     34,064     524     2,470     34,573     37,043     5,454     31,589     2000     2007   35 years

4024

 

Sunrise of Naperville

  Naperville   IL         1,946     28,538     613     1,960     29,137     31,097     4,664     26,433     1999     2007   35 years

4036

 

Sunrise of Willowbrook

  Willowbrook   IL     20,038     1,454     60,738     1,035     1,973     61,254     63,227     7,445     55,782     2000     2007   35 years

4040

 

Sunrise of Bloomingdale

  Bloomingdale   IL     18,627     1,287     38,625     482     1,296     39,098     40,394     5,882     34,512     2000     2007   35 years

4042

 

Sunrise of Buffalo Grove

  Buffalo Grove   IL     14,765     2,154     28,021     536     2,189     28,522     30,711     4,424     26,287     1999     2007   35 years

4060

 

Sunrise of Palos Park

  Palos Park   IL     20,404     2,363     42,205     460     2,363     42,665     45,028     6,459     38,569     2001     2007   35 years

4052

 

Sunrise of Baton Rouge

  Baton Rouge   LA     8,722     1,212     23,547     572     1,212     24,119     25,331     3,671     21,660     2000     2007   35 years

4032

 

Sunrise of Norwood

  Norwood   MA         2,230     30,968     812     2,240     31,770     34,010     4,546     29,464     1997     2007   35 years

4051

 

Sunrise of Arlington

  Arlington   MA     18,682     86     34,393     400     86     34,793     34,879     5,375     29,843     2001     2007   35 years

4033

 

Sunrise of Columbia

  Columbia   MD         1,780     23,083     1,066     1,852     24,077     25,929     3,470     22,459     1996     2007   35 years

4034

 

Sunrise of Rockville

  Rockville   MD         1,039     39,216     659     1,061     39,853     40,914     5,511     35,403     1997     2007   35 years

4008

 

Sunrise of North Ann Arbor

  Ann Arbor   MI         1,703     15,857     439     1,668     16,331     17,999     2,591     15,408     2000     2007   35 years

4031

 

Sunrise of Troy

  Troy   MI         1,758     23,727     214     1,761     23,938     25,699     3,865     21,834     2001     2007   35 years

4038

 

Sunrise of Bloomfield

  Bloomfield Hills   MI         3,736     27,657     1,216     3,737     28,872     32,609     4,258     28,351     2006     2007   35 years

4046

 

Sunrise of Northville

  Plymouth   MI     14,918     1,445     26,090     481     1,460     26,556     28,016     4,144     23,872     1999     2007   35 years

4048

 

Sunrise of Rochester

  Rochester   MI     18,614     2,774     38,666     383     2,774     39,049     41,823     5,935     35,888     1998     2007   35 years

4054

 

Sunrise of Edina

  Edina   MN     9,637     3,181     24,224     1,554     3,184     25,775     28,959     3,992     24,967     1999     2007   35 years

4017

 

Sunrise at North Hills

  Raleigh   NC         749     37,091     586     751     37,675     38,426     5,491     32,935     2000     2007   35 years

4019

 

Sunrise on Providence

  Charlotte   NC         1,976     19,472     591     1,981     20,058     22,039     3,136     18,903     1999     2007   35 years

4001

 

Sunrise of Morris Plains

  Morris Plains   NJ     19,284     1,492     32,052     401     1,492     32,453     33,945     4,856     29,089     1997     2007   35 years

4002

 

Sunrise of Old Tappan

  Old Tappan   NJ     17,909     2,985     36,795     275     2,985     37,070     40,055     5,517     34,538     1997     2007   35 years

4005

 

Sunrise of Wayne

  Wayne   NJ     14,226     1,288     24,990     530     1,290     25,518     26,808     3,845     22,963     1996     2007   35 years

4006

 

Sunrise of Westfield

  Westfield   NJ     18,851     5,057     23,803     574     5,057     24,377     29,434     3,731     25,703     1996     2007   35 years

4025

 

Sunrise of East Brunswick

  East Brunswick   NJ         2,784     26,173     611     2,784     26,784     29,568     4,387     25,181     1999     2007   35 years

4029

 

Sunrise of Woodcliff Lake

  Woodcliff Lake   NJ         3,493     30,801     279     3,496     31,077     34,573     5,088     29,485     2000     2007   35 years

4062

 

Sunrise of Wall

  Wall   NJ     10,331     1,053     19,101     377     1,055     19,476     20,531     3,095     17,436     1999     2007   35 years

4011

 

Sunrise of New City

  New City   NY         1,906     27,323     563     1,906     27,886     29,792     4,254     25,538     1999     2007   35 years

4027

 

Sunrise of North Lynbrook

  Lynbrook   NY         4,622     38,087     764     4,678     38,795     43,473     6,266     37,207     1999     2007   35 years

4044

 

Sunrise at Fleetwood

  Mount Vernon   NY     13,388     4,381     28,434     585     4,394     29,006     33,400     4,617     28,783     1999     2007   35 years

4049

 

Sunrise of Smithtown

  Smithtown   NY     13,923     2,853     25,621     910     3,027     26,357     29,384     4,533     24,851     1999     2007   35 years

4063

 

Sunrise of Staten Island

  Staten Island   NY         7,237     23,910     (286 )   7,281     23,580     30,861     4,515     26,346     2006     2007   35 years

4010

 

Sunrise of Cuyahoga Falls

  Cuyahoga Falls   OH         626     10,239     234     626     10,473     11,099     1,720     9,379     2000     2007   35 years

4013

 

Sunrise at Parma

  Cleveland   OH         695     16,641     332     695     16,973     17,668     2,565     15,103     2000     2007   35 years

4003

 

Sunrise at Granite Run

  Media   PA     11,698     1,272     31,781     534     1,272     32,315     33,587     4,682     28,905     1997     2007   35 years

4004

 

Sunrise of Abington

  Abington   PA     24,226     1,838     53,660     847     1,862     54,483     56,345     8,060     48,285     1997     2007   35 years

4007

 

Sunrise of Haverford

  Haverford   PA     7,601     941     25,872     532     951     26,394     27,345     3,952     23,393     1997     2007   35 years

4020

 

Sunrise of Westtown

  West Chester   PA         1,547     22,996     546     1,562     23,527     25,089     4,086     21,003     1999     2007   35 years

4022

 

Sunrise of Exton

  Exton   PA         1,123     17,765     530     1,151     18,267     19,418     2,971     16,447     2000     2007   35 years

4041

 

Sunrise of Blue Bell

  Blue Bell   PA     8,981     1,765     23,920     809     1,807     24,687     26,494     3,944     22,550     2006     2007   35 years

179


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

4037

 

Sunrise of Hillcrest

  Dallas   TX         2,616     27,680     144     2,616     27,824     30,440     4,122     26,318     2006     2007   35 years

4065

 

Sunrise of Sandy

  Sandy   UT         2,576     22,987     (272 )   2,608     22,683     25,291     3,437     21,854     2007     2007   35 years

4000

 

Sunrise of Springfield

  Springfield   VA     8,703     4,440     18,834     762     4,441     19,595     24,036     3,034     21,002     1997     2007   35 years

4026

 

Sunrise of Richmond

  Richmond   VA         1,120     17,446     659     1,137     18,088     19,225     2,938     16,287     1999     2007   35 years

4039

 

Sunrise of Alexandria

  Alexandria   VA     5,672     88     14,811     556     115     15,340     15,455     2,818     12,727     1998     2007   35 years

4069

 

Sunrise of Victoria

  Victoria   BC     13,990     8,332     29,970     (706 )   8,116     29,480     37,596     4,319     33,277     2001     2007   35 years

4073

 

Sunrise of Lynn Valley

  Vancouver   BC     14,719     11,759     37,424     (1,150 )   11,445     36,588     48,033     5,214     42,819     2002     2007   35 years

4077

 

Sunrise of Vancouver

  Vancouver   BC         6,649     31,937     245     6,653     32,178     38,831     4,922     33,909     2005     2007   35 years

4067

 

Sunrise of Unionville

  Markham   ON     14,921     2,322     41,140     (657 )   2,299     40,506     42,805     5,703     37,102     2000     2007   35 years

4068

 

Sunrise of Mississauga

  Mississauga   ON     13,057     3,554     33,631     (646 )   3,500     33,039     36,539     4,742     31,797     2000     2007   35 years

4070

 

Sunrise of Burlington

  Burlington   ON         1,173     24,448     152     1,173     24,600     25,773     3,540     22,233     2001     2007   35 years

4071

 

Sunrise of Oakville

  Oakville   ON         2,753     37,489     367     2,753     37,856     40,609     5,374     35,235     2002     2007   35 years

4072

 

Sunrise of Richmond Hill

  Richmond Hill   ON     12,300     2,155     41,254     (924 )   2,100     40,385     42,485     5,688     36,797     2002     2007   35 years

4074

 

Sunrise of Windsor

  Windsor   ON         1,813     20,882     248     1,833     21,110     22,943     3,141     19,802     2001     2007   35 years

4075

 

Sunrise of Aurora

  Aurora   ON         1,570     36,113     (783 )   1,531     35,369     36,900     5,208     31,692     2002     2007   35 years

4076

 

Sunrise of Erin Mills

  Mississauga   ON         1,957     27,020     (575 )   1,905     26,497     28,402     4,178     24,224     2007     2007   35 years

4078

 

Thorne Mill of Steeles

  Vaughan   ON         2,563     57,513     1,561     1,401     60,236     61,637     7,628     54,009     2003     2007   35 years
                                                                 

 

TOTAL FOR SUNRISE SENIORS HOUSING COMMUNITIES

            522,543     212,352     2,286,059     39,252     212,519     2,325,144     2,537,663     351,291     2,186,801                

 

ATRIA SENIORS HOUSING COMMUNITIES

                                                                             

8248

 

Atria Regency

  Mobile   AL     6,216     950     11,897     7     950     11,904     12,854     346     12,836     1996     2011   35 years

8270

 

Atria Campana Del Rio

  Tucson   AZ     25,471     5,861     37,284     209     5,861     37,493     43,354     1,037     43,061     1964     2011   35 years

8272

 

Atria Valley Manor

  Tucson   AZ     3,278     1,709     60     19     1,709     79     1,788     6     1,904     1963     2011   35 years

8342

 

Atria Bell Court Gardens

  Tucson   AZ     19,611     3,010     30,969     8     3,010     30,977     33,987     762     33,719     1964     2011   35 years

8584

 

Atria Chandler Villas

  Chandler   AZ     8,277     3,650     8,450     18     3,650     8,468     12,118     351     11,939     1988     2011   35 years

8502

 

Atria Covina

  Covina   CA         170     4,131     7     170     4,138     4,308     143     4,400     1977     2011   35 years

8510

 

Atria Chateau Gardens

  San Jose   CA         39     487     7     39     494     533     74     2,037     1977     2011   35 years

8517

 

Atria Collwood

  San Diego   CA         290     10,650     2     290     10,652     10,942     305     12,462     1976     2011   35 years

8523

 

Atria Palm Desert

  Palm Desert   CA     3,523     2,887     9,843     118     2,887     9,961     12,848     329     12,780     1988     2011   35 years

8529

 

Atria Covell Gardens

  Davis   CA     20,427     2,163     39,657     439     2,163     40,096     42,259     949     41,893     1987     2011   35 years

8532

 

Atria Golden Creek

  Irvine   CA     11,813     6,900     23,544     50     6,900     23,594     30,494     634     30,471     1985     2011   35 years

8533

 

Atria Hillcrest

  Thousand Oaks   CA     21,589     6,020     25,635     1,168     6,020     26,803     32,823     639     32,712     1987     2011   35 years

8538

 

Atria Bayside Landing

  Stockton   CA             467     4         471     471     71     2,724     1998     2011   35 years

8541

 

Atria Chateau San Juan

  San Juan Capistrano   CA         5,110     29,436     5,074     5,110     34,510     39,620     521     39,405     1985     2011   35 years

8544

 

Atria El Camino Gardens

  Carmichael   CA         6,930     32,318     56     6,930     32,374     39,304     706     39,426     1984     2011   35 years

8545

 

Atria Hacienda

  Palm Desert   CA         6,680     85,900     517     6,680     86,417     93,097     1,503     92,427     1989     2011   35 years

8546

 

Atria Hillsdale

  San Mateo   CA     9,252     5,240     15,956     4     5,240     15,960     21,200     413     21,243     1986     2011   35 years

8553

 

Atria Rancho Park

  San Dimas   CA         4,066     14,306     60     4,066     14,366     18,432     383     18,410     1975     2011   35 years

8554

 

Atria Tamalpais Creek

  Novato   CA         5,812     24,703     4     5,812     24,707     30,519     495     30,602     1978     2011   35 years

8559

 

Atria Del Rey

  Rancho Cucamonga   CA         3,290     17,427     1,733     3,290     19,160     22,450     356     22,477     1987     2011   35 years

8560

 

Atria Del Sol

  Mission Viejo   CA     5,966     3,500     12,458     1     3,500     12,459     15,959     264     16,034     1985     2011   35 years

8561

 

Atria Encinitas

  Encinitas   CA         5,880     9,212     24     5,880     9,236     15,116     238     15,228     1984     2011   35 years

8563

 

Atria Willow Glen

  San Jose   CA         8,521     43,168     7     8,521     43,175     51,696     7     53,286     1976     2011   35 years

8575

 

Atria Burlingame

  Burlingame   CA     7,661     2,494     12,373     95     2,494     12,468     14,962     304     15,002     1977     2011   35 years

8578

 

Atria Sunnyvale

  Sunnyvale   CA     8,814     6,120     30,068     578     6,120     30,646     36,766     711     36,466     1977     2011   35 years

8579

 

Atria Montego Heights

  Walnut Creek   CA         6,910     15,797     (18 )   6,910     15,779     22,689     512     22,688     1978     2011   35 years

8580

 

Atria Daly City

  Daly City   CA     7,778     3,090     13,448         3,090     13,448     16,538     341     16,497     1975     2011   35 years

8582

 

Atria Valley View

  Walnut Creek   CA     19,216     7,139     53,914     103     7,139     54,017     61,156     1,621     60,135     1977     2011   35 years

8585

 

Atria Las Posas

  Camarillo   CA         4,500     28,436     17     4,500     28,453     32,953     677     32,815     1997     2011   35 years

8603

 

Atria Inn at Lakewood

  Lakewood   CO     23,377     6,281     50,095     4     6,281     50,099     56,380     1,107     56,062     1999     2011   35 years

8311

 

Atria Stratford

  Stratford   CT     16,373     3,210     27,865     77     3,210     27,942     31,152     697     31,038     1999     2011   35 years

8434

 

Atria Darien

  Darien   CT     21,280     653     37,587     313     653     37,900     38,553     853     38,367     1997     2011   35 years

8435

 

Atria Stamford

  Stamford   CT     39,594     1,200     62,432     199     1,200     62,631     63,831     1,396     63,385     1975     2011   35 years

8725

 

Atria Crossroads Place

  Waterford   CT     25,158     2,401     36,495     193     2,401     36,688     39,089     836     38,797     2000     2011   35 years

8726

 

Atria Greenridge Place

  Rocky Hill   CT     17,259     2,170     32,553     15     2,170     32,568     34,738     743     34,573     1998     2011   35 years

8727

 

Atria Hamilton Heights

  West Hartford   CT     14,187     3,120     14,674     204     3,120     14,878     17,998     462     17,964     1904     2011   35 years

8728

 

Atria Larson Place

  Hamden   CT     11,569     1,850     16,098     26     1,850     16,124     17,974     456     17,885     1999     2011   35 years

8229

 

Atria San Pablo

  Jacksonville   FL     5,943     1,620     14,920     7     1,620     14,927     16,547     356     16,513     1999     2011   35 years

8233

 

The Heritage at Lake Forest

  Sanford   FL         3,589     32,586     5     3,589     32,591     36,180     277     36,828     2002     2011   35 years

8274

 

Atria Evergreen Woods

  Spring Hill   FL     10,975     2,370     28,371     27     2,370     28,398     30,768     806     30,551     1981     2011   35 years

8276

 

Atria Windsor Woods

  Hudson   FL     14,552     1,610     32,432     70     1,610     32,502     34,112     881     33,787     1988     2011   35 years

8537

 

Atria Baypoint Village

  Hudson   FL     17,178     2,083     28,841     17     2,083     28,858     30,941     857     30,712     1986     2011   35 years

180


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

8210

 

Atria Johnson Ferry

  Marietta   GA     3,895     990     6,453     14     990     6,467     7,457     181     7,476     1995     2011   35 years

8268

 

Atria Buckhead

  Atlanta   GA     4,987     3,660     5,274         3,660     5,274     8,934     195     9,039     1996     2011   35 years

8240

 

Atria Newburgh

  Newburgh   IN     4,798     1,150     22,880     3     1,150     22,883     24,033     533     23,878     1998     2011   35 years

8543

 

Atria Eastlake Terrace

  Elkhart   IN         2     468     1     2     469     471     109     1,764     1997     2011   35 years

8555

 

Atria Tanglewood Trace

  Mishawaka   IN             961     9         970     970     196     1,483     1976     2011   35 years

8249

 

Atria Hearthstone East

  Topeka   KS     7,732     1,150     20,544     12     1,150     20,556     21,706     513     21,599     1998     2011   35 years

8277

 

Atria Hearthstone West

  Topeka   KS     9,468     1,230     28,379     9     1,230     28,388     29,618     763     29,322     1987     2011   35 years

8209

 

Atria St. Matthews

  Louisville   KY     7,878     939     9,274     12     939     9,286     10,225     326     10,155     1998     2011   35 years

8228

 

Atria Elizabethtown

  Elizabethtown   KY     5,632     850     12,510     4     850     12,514     13,364     306     13,308     1996     2011   35 years

8235

 

Atria Highland Crossing

  Fort Wright   KY     11,728     1,677     14,393     76     1,677     14,469     16,146     444     16,019     1988     2011   35 years

8245

 

Atria Summit Hills

  Crestview Hills   KY     6,448     1,780     15,769     1     1,780     15,770     17,550     418     17,493     1998     2011   35 years

8246

 

Atria Stony Brook

  Louisville   KY     9,606     1,860     17,561     7     1,860     17,568     19,428     459     19,347     1999     2011   35 years

8258

 

Atria Springdale

  Louisville   KY     10,867     1,410     16,702     2     1,410     16,704     18,114     437     18,033     1999     2011   35 years

8162

 

Atria Falmouth

  Falmouth   MA         4,630         3,877     4,630     3,877     8,507         8,507     CIP     2011   CIP

8230

 

Atria Woodbriar

  Falmouth   MA     14,657     1,970     43,693     13     1,970     43,706     45,676     940     45,508     1975     2011   35 years

8730

 

Atria Fairhaven (Alden)

  Fairhaven   MA     11,901     1,100     16,093     2     1,100     16,095     17,195     372     17,173     1999     2011   35 years

8731

 

Atria Draper Place

  Hopedale   MA     13,884     1,140     17,794     6     1,140     17,800     18,940     428     18,890     1998     2011   35 years

8733

 

Atria Longmeadow Place

  Burlington   MA     24,122     5,310     58,021     16     5,310     58,037     63,347     1,262     62,907     1998     2011   35 years

8735

 

Atria Marina Place

  North Quincy   MA     29,587     2,590     33,899     68     2,590     33,967     36,557     810     36,258     1999     2011   35 years

8736

 

Atria Marland Place

  Andover   MA         1,831     34,592     72     1,831     34,664     36,495     822     36,284     1996     2011   35 years

8737

 

Atria Merrimack Place

  Newburyport   MA     19,461     2,774     40,645     14     2,774     40,659     43,433     878     43,177     2000     2011   35 years

8332

 

Atria Manresa

  Annapolis   MD     6,620     4,193     19,000     44     4,193     19,044     23,237     455     23,232     1920     2011   35 years

8333

 

Atria Salisbury

  Salisbury   MD     6,350     1,940     24,500     17     1,940     24,517     26,457     541     26,372     1995     2011   35 years

8241

 

Atria Kennebunk

  Kennebunk   ME     9,140     1,090     23,496     7     1,090     23,503     24,593     568     24,458     1998     2011   35 years

8548

 

Atria Kinghaven

  Riverview   MI     14,404     1,440     26,260     9     1,440     26,269     27,709     721     27,555     1987     2011   35 years

8305

 

Atria Merrywood

  Charlotte   NC     21,416     1,678     36,892     42     1,678     36,934     38,612     928     38,223     1991     2011   35 years

8319

 

Atria Cranford

  Cranford   NJ     27,714     8,260     61,411     65     8,260     61,476     69,736     1,411     69,464     1993     2011   35 years

8335

 

Atria Tinton Falls

  Tinton Falls   NJ     9,662     6,580     13,258     29     6,580     13,287     19,867     421     19,935     1999     2011   35 years

8524

 

Atria Summit Ridge

  Reno   NV         4     407     3     4     410     414     72     676     1997     2011   35 years

8525

 

Atria Sunlake

  Las Vegas   NV         7     732     13     7     745     752     125     3,950     1998     2011   35 years

8526

 

Atria Sutton

  Las Vegas   NV             863     6         869     869     142     4,106     1998     2011   35 years

8587

 

Atria Seville

  Las Vegas   NV             796     10         806     806     126     4,251     1999     2011   35 years

8309

 

Atria 86th Street

  New York   NY     33,148     80     73,685     79     80     73,764     73,844     1,698     82,176     1998     2011   35 years

8310

 

Atria Great Neck

  Great Neck   NY     15,315     3,390     54,051     14     3,390     54,065     57,455     1,175     57,274     1998     2011   35 years

8312

 

Atria Kew Gardens

  Jamaica   NY     29,533     3,051     66,013     108     3,051     66,121     69,172     1,424     68,798     1999     2011   35 years

8313

 

Atria Briarcliff Manor

  Briarcliff Manor   NY     15,254     6,560     33,885     64     6,560     33,949     40,509     808     40,457     1997     2011   35 years

8314

 

Atria Riverdale

  Bronx   NY     22,914     1,020     24,149     29     1,020     24,178     25,198     656     25,075     1999     2011   35 years

8321

 

Atria Shaker

  Albany   NY     13,087     1,520     29,667     5     1,520     29,672     31,192     703     31,028     1997     2011   35 years

8323

 

Atria South Setauket

  South Setauket   NY         8,450     14,534     8     8,450     14,542     22,992     454     23,271     1967     2011   35 years

8325

 

Atria Huntington

  Huntington Station   NY     6,887     8,190     1,169     14     8,190     1,183     9,373     171     9,535     1987     2011   35 years

8327

 

Atria Penfield

  Penfield   NY     6,562     620     22,036     11     620     22,047     22,667     529     22,482     1972     2011   35 years

8328

 

Atria Greece

  Rochester   NY     4,023     410     14,967     88     410     15,055     15,465     359     15,395     1970     2011   35 years

8329

 

Atria Lynbrook

  Lynbrook   NY     7,080     3,145     5,489     14     3,145     5,503     8,648     229     8,802     1996     2011   35 years

8330

 

Atria Crossgate

  Albany   NY     4,547     1,080     20,599     15     1,080     20,614     21,694     520     21,580     1980     2011   35 years

8331

 

Atria East Northport

  East Northport   NY         9,960     34,467     191     9,960     34,658     44,618     862     44,562     1996     2011   35 years

181


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

8436

 

Atria Rye Brook

  Rye Brook   NY     45,613     9,660     74,936     61     9,660     74,997     84,657     1,676     84,131     2004     2011   35 years

8437

 

Atria on Roslyn Harbor

  Roslyn   NY     65,325     12,909     72,720     5     12,909     72,725     85,634     1,582     85,246     2006     2011   35 years

8438

 

Atria Cutter Mill

  Great Neck   NY     36,605     2,750     47,919     93     2,750     48,012     50,762     1,093     50,519     1999     2011   35 years

8439

 

Atria Glen Cove

  Glen Cove   NY     11,705     2,035     25,190     650     2,035     25,840     27,875     727     27,170     1997     2011   35 years

8455

 

Atria Bay Shore

  Bay Shore   NY     15,275     4,440     31,983     3     4,440     31,986     36,426     741     36,296     1900     2011   35 years

8458

 

Atria Forest Hills

  Forest Hills   NY     12,500     2,050     16,680     26     2,050     16,706     18,756     411     18,756     2001     2011   35 years

8461

 

Atria Plainview

  Plainview   NY     14,299     2,480     16,060         2,480     16,060     18,540     408     18,582     2000     2011   35 years

8464

 

Atria Tanglewood

  Lynbrook   NY     27,175     4,120     37,348     5     4,120     37,353     41,473     835     41,305     2005     2011   35 years

8467

 

Atria Woodlands

  Ardsley   NY     47,967     7,660     65,581     100     7,660     65,681     73,341     1,492     73,127     2005     2011   35 years

8738

 

Atria Guilderland

  Slingerlands   NY         1,170     22,414     4     1,170     22,418     23,588     528     23,510     1950     2011   35 years

8739

 

Atria on the Hudson

  Ossining   NY         8,123     63,089     1,476     8,123     64,565     72,688     1,461     71,455     1972     2011   35 years

8338

 

Atria Bethlehem

  Bethlehem   PA     13,312     2,479     22,870     80     2,479     22,950     25,429     598     25,342     1998     2011   35 years

8339

 

Atria South Hills

  Pittsburgh   PA     5,132     880     10,884     3     880     10,887     11,767     323     11,772     1998     2011   35 years

8433

 

Atria Center City

  Philadelphia   PA     24,738     3,460     18,291     23     3,460     18,314     21,774     526     21,776     1964     2011   35 years

8742

 

Atria Woodbridge Place

  Phoenixville   PA     12,432     1,510     19,130     13     1,510     19,143     20,653     480     20,629     1996     2011   35 years

8602

 

Atria Bay Spring Village

  Barrington   RI     14,162     2,000     33,400     534     2,000     33,934     35,934     823     35,594     2000     2011   35 years

8743

 

Atria Aquidneck Place

  Portsmouth   RI         2,810     31,623     12     2,810     31,635     34,445     567     34,378     1999     2011   35 years

8744

 

Atria Harborhill Place

  East Greenwich   RI         2,089     21,702     11     2,089     21,713     23,802     427     23,825     1835     2011   35 years

8745

 

Atria Lincoln Place

  Lincoln   RI         1,440     12,686     10     1,440     12,696     14,136     308     14,100     2000     2011   35 years

8263

 

Atria Forest Lake

  Columbia   SC     5,545     670     13,946     7     670     13,953     14,623     337     14,569     1999     2011   35 years

8205

 

Atria Weston Place

  Knoxville   TN     10,155     793     7,961     6     793     7,967     8,760     260     8,772     1993     2011   35 years

8215

 

Atria Cypresswood

  Spring   TX     9,728     880     9,192     19     880     9,211     10,091     244     10,075     1996     2011   35 years

8218

 

Atria Kingwood

  Kingwood   TX     335     1,170     4,518     1     1,170     4,519     5,689     164     5,719     1998     2011   35 years

8234

 

Atria Copeland

  Tyler   TX     10,544     1,879     17,901     2     1,879     17,903     19,782     458     19,624     1997     2011   35 years

8243

 

Atria Carrollton

  Carrollton   TX     7,941     360     20,465     9     360     20,474     20,834     504     20,888     1998     2011   35 years

8247

 

Atria Grapevine

  Grapevine   TX     10,201     2,070     23,104     6     2,070     23,110     25,180     562     25,035     1999     2011   35 years

8252

 

Atria Sugar Land

  Sugar Land   TX     3,081     970     17,542     2     970     17,544     18,514     414     18,417     1999     2011   35 years

8254

 

Atria Westchase

  Houston   TX     7,056     2,318     22,278     10     2,318     22,288     24,606     554     24,474     1999     2011   35 years

8257

 

Atria Richardson

  Richardson   TX     11,214     1,590     23,662     14     1,590     23,676     25,266     565     25,112     1998     2011   35 years

8266

 

Atria Willow Park

  Tyler   TX     11,807     920     31,271     28     920     31,299     32,219     813     31,923     1985     2011   35 years

8278

 

Atria Sandy

  Sandy   UT     13,868     3,356     18,805     19     3,356     18,824     22,180     580     22,022     1986     2011   35 years

8239

 

Atria Virginia Beach (Hilltop)

  Virginia Beach   VA     17,629     1,749     33,004     3     1,749     33,007     34,756     795     34,489     1998     2011   35 years
                                                                 

 

TOTAL FOR ATRIA SENIORS HOUSING COMMUNITIES

            1,311,988     354,589     2,963,329     19,806     354,589     2,983,135     3,337,724     71,171     3,350,450                

182


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

 

OTHER SENIORS HOUSING COMMUNITIES

                                                                             

3880

 

Elmcroft of Grayson Valley

  Birmingham   AL         1,040     19,145     11     1,040     19,156     20,196     304     20,077     2000     2011   35 years

3873

 

Elmcroft of Byrd Springs

  Hunstville   AL         1,720     11,270         1,720     11,270     12,990     192     12,917     1999     2011   35 years

3881

 

Elmcroft of Heritage Woods

  Mobile   AL         1,020     10,241         1,020     10,241     11,261     178     11,187     2000     2011   35 years

3106

 

CaraVita Village

  Montgomery   AL         779     8,507     802     779     9,309     10,088     2,003     8,085     1987     2005   35 years

3800

 

Elmcroft of Halcyon

  Montgomery   AL         220     5,476         220     5,476     5,696     808     4,888     1999     2006   35 years

7635

 

Rosewood Manor (AL)

  Scottsboro   AL         680     4,038         680     4,038     4,718     67     4,695     1998     2011   35 years

7567

 

The Arches

  Benton   AR         330     1,462         330     1,462     1,792     32     2,032     1990     2011   35 years

3821

 

Elmcroft of Blytheville

  Blytheville   AR         294     2,946         294     2,946     3,240     435     2,805     1997     2006   35 years

3605

 

West Shores

  Hot Springs   AR         1,326     10,904         1,326     10,904     12,230     2,089     10,141     1988     2005   35 years

3822

 

Elmcroft of Maumelle

  Maumelle   AR         1,252     7,601         1,252     7,601     8,853     1,122     7,731     1997     2006   35 years

3823

 

Elmcroft of Mountain Home

  Mountain Home   AR         204     8,971         204     8,971     9,175     1,324     7,851     1997     2006   35 years

3825

 

Elmcroft of Sherwood

  Sherwood   AR         1,320     5,693         1,320     5,693     7,013     840     6,173     1997     2006   35 years

7301

 

Chandler Memory Care Community

  Chandler   AZ         2,910         7,944     2,910     7,944     10,854         10,854     2011     2011   35 years

3601

 

Cottonwood Village

  Cottonwood   AZ         1,200     15,124         1,200     15,124     16,324     2,865     13,459     1986     2005   35 years

7308

 

Silver Creek Inn Memory Care Community

  Gilbert   AZ                 2,362         2,362     2,362         2,362     CIP     2011   CIP

7010

 

Arbor Rose

  Mesa   AZ         1,100     11,880     1,576     1,100     13,456     14,556     186     14,485     1999     2011   35 years

3894

 

Elmcroft of Tempe

  Tempe   AZ         1,090     12,942     3     1,090     12,945     14,035     218     13,946     1999     2011   35 years

3891

 

Elmcroft of River Centre

  Tucson   AZ         1,940     5,195         1,940     5,195     7,135     105     7,096     1999     2011   35 years

2803

 

Emeritus at Fairwood Manor

  Anaheim   CA         2,464     7,908         2,464     7,908     10,372     1,855     8,517     1977     2005   35 years

7072

 

Careage Banning

  Banning   CA         2,970     16,037         2,970     16,037     19,007     283     22,680     2004     2011   35 years

3811

 

Las Villas Del Carlsbad

  Carlsbad   CA         1,760     30,469         1,760     30,469     32,229     4,498     27,731     1987     2006   35 years

2245

 

Villa Bonita

  Chula Vista   CA         1,610     9,169         1,610     9,169     10,779     168     14,142     1989     2011   35 years

2813

 

Emeritus at Barrington Court

  Danville   CA         360     4,640         360     4,640     5,000     814     4,186     1999     2006   35 years

3805

 

Las Villas Del Norte

  Escondido   CA         2,791     32,632         2,791     32,632     35,423     4,817     30,606     1986     2006   35 years

7480

 

Alder Bay Assisted Living

  Eureka   CA         1,170     5,228     27     1,170     5,255     6,425     96     6,386     1997     2011   35 years

3808

 

Elmcroft of La Mesa

  La Mesa   CA         2,431     6,101         2,431     6,101     8,532     901     7,631     1997     2006   35 years

3810

 

Grossmont Gardens

  La Mesa   CA         9,104     59,349         9,104     59,349     68,453     8,761     59,692     1964     2006   35 years

3809

 

Mountview Retirement Residence

  Montrose   CA         1,089     15,449         1,089     15,449     16,538     2,281     14,257     1974     2006   35 years

1701

 

Villa de Palma

  Placentia   CA         1,260     10,174         1,260     10,174     11,434     184     14,831     1982     2011   35 years

2244

 

Wellington Place

  Rancho Mirage   CA         6,800     3,637         6,800     3,637     10,437     104     11,962     1999     2011   35 years

7481

 

The Vistas

  Redding   CA         1,290     22,033         1,290     22,033     23,323     355     23,186     2007     2011   35 years

2815

 

Emeritus at Roseville Gardens

  Roseville   CA         220     2,380         220     2,380     2,600     422     2,178     1996     2006   35 years

3807

 

Elmcroft of Point Loma

  San Diego   CA         2,117     6,865         2,117     6,865     8,982     1,013     7,969     1999     2006   35 years

2243

 

Land of Cortese Assisted Living

  San Jose   CA         2,700     7,994         2,700     7,994     10,694     166     11,514     1998     2011   35 years

1700

 

Villa del Obispo

  San Juan Capistrano   CA         2,660     9,560         2,660     9,560     12,220     170     14,460     1985     2011   35 years

3604

 

Villa Santa Barbara

  Santa Barbara   CA         1,219     12,426         1,219     12,426     13,645     2,369     11,276     1977     2005   35 years

1702

 

Maria del Sol

  Santa Maria   CA         1,950     1,726         1,950     1,726     3,676     70     3,635     1967     2011   35 years

2804

 

Emeritus at Heritage Place

  Tracy   CA         1,110     13,296         1,110     13,296     14,406     2,689     11,717     1986     2005   35 years

2242

 

Buena Vista Knolls

  Vista   CA         1,630     5,640         1,630     5,640     7,270     112     8,444     1980     2011   35 years

3806

 

Rancho Vista

  Vista   CA         6,730     21,828         6,730     21,828     28,558     3,222     25,336     1982     2006   35 years

1712

 

Westminster Terrace

  Westminster   CA         1,700     11,514         1,700     11,514     13,214     189     13,646     2001     2011   35 years

7485

 

Garden Square at Westlake

  Greeley   CO         630     8,211         630     8,211     8,841     140     8,784     1998     2011   35 years

7486

 

Garden Square of Greeley

  Greeley   CO         330     2,735         330     2,735     3,065     48     3,197     1995     2011   35 years

7110

 

Devonshire Acres

  Sterling   CO         950     13,569         950     13,569     14,519     225     14,431     1979     2011   35 years

7292

 

Gardenside Terrace

  Brandford   CT         7,000     31,518         7,000     31,518     38,518     509     38,328     1999     2011   35 years

7291

 

Hearth at Tuxis Pond

  Madison   CT         1,610     44,322         1,610     44,322     45,932     680     45,633     2002     2011   35 years

2802

 

Emeritus at South Windsor

  South Windsor   CT         2,187     12,682         2,187     12,682     14,869     2,855     12,014     1999     2004   35 years

7636

 

Forsyth House

  Milton   FL         610     6,503         610     6,503     7,113     106     7,205     1999     2011   35 years

7120

 

Hampton Manor Belleview

  Belleview   FL         390     8,337         390     8,337     8,727     141     8,665     1988     2011   35 years

183


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

2807

 

Emeritus at Bonita Springs

  Bonita Springs   FL     9,380     1,540     10,783         1,540     10,783     12,323     2,932     9,391     1989     2005   35 years

2808

 

Emeritus at Boynton Beach

  Boynton Beach   FL     14,375     2,317     16,218         2,317     16,218     18,535     4,211     14,324     1999     2005   35 years

7638

 

Sabal House

  Cantonment   FL         430     5,902         430     5,902     6,332     97     6,331     1999     2011   35 years

7231

 

Bristol Park of Coral Springs

  Coral Springs   FL         3,280     11,877         3,280     11,877     15,157     208     15,086     1999     2011   35 years

2809

 

Emeritus at Deer Creek

  Deerfield   FL         1,399     9,791         1,399     9,791     11,190     2,929     8,261     1999     2005   35 years

7639

 

Stanley House

  Defuniak Springs   FL         410     5,659         410     5,659     6,069     93     6,170     1999     2011   35 years

7520

 

The Peninsula

  Hollywood   FL         3,660     9,122         3,660     9,122     12,782     185     14,257     1972     2011   35 years

3102

 

Highland Terrace

  Inverness   FL         269     4,108         269     4,108     4,377     899     3,478     1997     2005   35 years

3801

 

Elmcroft of Timberlin Parc

  Jacksonville   FL         455     5,905         455     5,905     6,360     872     5,488     1998     2006   35 years

2810

 

Emeritus at Jensen Beach

  Jensen Beach   FL     12,899     1,831     12,820         1,831     12,820     14,651     3,468     11,183     1999     2005   35 years

3970

 

The Carlisle Naples

  Naples   FL     37,593     8,406     78,091         8,406     78,091     86,497     646     86,778     N/A     2011   35 years

7121

 

Hampton Manor at 24th Road

  Ocala   FL         690     8,767         690     8,767     9,457     143     9,401     1996     2011   35 years

7122

 

Hampton Manor at Deerwood

  Ocala   FL         790     5,605         790     5,605     6,395     102     6,388     2005     2011   35 years

1707

 

Outlook Pointe at Pensacola

  Pensacola   FL         2,230     2,362         2,230     2,362     4,592     64     6,938     1999     2011   35 years

7637

 

Magnolia House

  Quincy   FL         400     5,190         400     5,190     5,590     87     5,555     1999     2011   35 years

1708

 

Outlook Pointe at Tallahassee

  Tallahassee   FL         2,430     17,745         2,430     17,745     20,175     305     20,056     1999     2011   35 years

1714

 

Magnolia Place

  Tallahassee   FL         640     8,013         640     8,013     8,653     128     8,605     1999     2011   35 years

7230

 

Bristol Park of Tamarac

  Tamarac   FL         3,920     14,130         3,920     14,130     18,050     239     17,974     2000     2011   35 years

3874

 

Elmcroft of Carrolwood

  Tampa   FL         5,410     20,944     2     5,410     20,946     26,356     337     26,261     2001     2011   35 years

7410

 

Augusta Gardens

  Augusta   GA         530     10,262         530     10,262     10,792     172     10,715     1997     2011   35 years

3104

 

Tara Plantation

  Cumming   GA         1,381     7,707         1,381     7,707     9,088     1,654     7,434     1998     2005   35 years

3103

 

Peachtree Estates

  Dalton   GA         501     5,229         501     5,229     5,730     1,157     4,573     2000     2005   35 years

3888

 

Elmcroft of Mt. Zion

  Jonesboro   GA         1,140     15,447         1,140     15,447     16,587     257     16,482     2000     2011   35 years

3107

 

The Sanctuary at Northstar

  Kennesaw   GA         906     5,614         906     5,614     6,520     1,189     5,331     2001     2005   35 years

3101

 

Greenwood Gardens

  Marietta   GA         706     3,132         706     3,132     3,838     750     3,088     1997     2005   35 years

3887

 

Elmcroft of Milford Chase

  Marietta   GA         3,350     7,431         3,350     7,431     10,781     143     10,737     2000     2011   35 years

3826

 

Elmcroft of Martinez

  Martinez   GA         408     6,764         408     6,764     7,172     870     6,302     1997     2007   35 years

3100

 

Winterville Retirement

  Winterville   GA         243     7,418         243     7,418     7,661     1,552     6,109     1999     2005   35 years

7000

 

Windsor Court of Carmel

  Carmel   IN         1,110     1,933         1,110     1,933     3,043     46     5,058     1998     2011   35 years

1573

 

Azalea Hills

  Floyds Knobs   IN         2,370     8,708         2,370     8,708     11,078     148     13,108     2008     2011   35 years

3606

 

Georgetowne Place

  Fort Wayne   IN         1,315     18,185         1,315     18,185     19,500     3,300     16,200     1987     2005   35 years

1559

 

Greensburg Assisted Living

  Greensburg   IN         420     1,764         420     1,764     2,184     38     2,184     1999     2011   35 years

1551

 

Summit West

  Indianapolis   IN         1,240     7,922         1,240     7,922     9,162     142     9,372     1998     2011   35 years

3603

 

The Harrison

  Indianapolis   IN         1,200     5,740         1,200     5,740     6,940     1,190     5,750     1985     2005   35 years

3607

 

Towne Centre

  Merrillville   IN         1,291     27,709         1,291     27,709     29,000     8,163     20,837     1987     2006   35 years

1564

 

Lakeview Commons of Monticello

  Monticello   IN         250     5,263         250     5,263     5,513     84     5,480     1999     2011   35 years

3827

 

Elmcroft of Muncie

  Muncie   IN         244     11,218         244     11,218     11,462     1,442     10,020     1998     2007   35 years

7482

 

Wood Ridge

  South Bend   IN         590     4,850     57     590     4,907     5,497     85     5,462     1990     2011   35 years

7344

 

Drury Place at Alvamar

  Lawrence   KS         1,700     9,156         1,700     9,156     10,856     159     10,799     1995     2011   35 years

7345

 

Drury Place at Salina

  Salina   KS         1,300     1,738         1,300     1,738     3,038     50     4,091     1989     2011   35 years

7346

 

Drury Place Retirement Apartments

  Topeka   KS         390     6,217         390     6,217     6,607     106     6,568     1986     2011   35 years

2510

 

Heritage Woods

  Agawam   MA         1,249     4,625         1,249     4,625     5,874     1,575     4,299     1997     2004   30 years

2805

 

Summerville at Farm Pond

  Framingham   MA     39,311     5,819     33,361         5,819     33,361     39,180     6,985     32,195     1999     2004   35 years

2806

 

Whitehall Estate

  Hyannis   MA     6,681     1,277     9,063         1,277     9,063     10,340     1,825     8,515     1999     2005   35 years

1738

 

Wingate at Silver Lake

  Kingston   MA         3,330     20,624         3,330     20,624     23,954     375     23,777     1996     2011   35 years

1709

 

Outlook Pointe at Hagerstown

  Hagerstown   MD         2,010     1,293         2,010     1,293     3,303     45     5,415     1999     2011   35 years

7130

 

Clover Healthcare

  Auburn   ME         1,400     26,895         1,400     26,895     28,295     463     28,111     1982     2011   35 years

7132

 

Gorham House

  Gorham   ME         1,360     33,147         1,360     33,147     34,507     513     34,335     1990     2011   35 years

7131

 

Sentry Hill

  York   ME         3,490     19,869         3,490     19,869     23,359     319     23,270     2000     2011   35 years

184


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

3878

 

Elmcroft of Downriver

  Brownstown   MI     9,273     320     32,652         320     32,652     32,972     501     32,774     2000     2011   35 years

3883

 

Elmcroft of Kentwood

  Kentwood   MI         510     13,976         510     13,976     14,486     240     14,379     2001     2011   35 years

7421

 

Primrose Austin

  Austin   MN         2,540     11,707         2,540     11,707     14,247     183     14,195     2002     2011   35 years

7423

 

Primrose Duluth

  Duluth   MN         6,190     8,296         6,190     8,296     14,486     149     14,912     2003     2011   35 years

7424

 

Primrose Mankato

  Mankato   MN         1,860     8,920         1,860     8,920     10,780     153     10,726     1999     2011   35 years

3608

 

Rose Arbor

  Maple Grove   MN         1,140     12,421         1,140     12,421     13,561     3,680     9,881     2000     2006   35 years

3609

 

Wildflower Lodge

  Maple Grove   MN         504     5,035         504     5,035     5,539     1,497     4,042     1981     2006   35 years

7521

 

Silver Oak SL of Butler

  Butler   MO         520     648         520     648     1,168     23     1,155     1995     2011   35 years

7522

 

Silver Oak SL of Lamar

  Lamar   MO         1,650     810         1,650     810     2,460     23     2,459     1996     2011   35 years

7523

 

Silver Oak SL of Nevada I

  Nevada   MO         630     373         630     373     1,003     17     995     1993     2011   35 years

7524

 

Silver Oak SL of Nevada II

  Nevada   MO         790     324         790     324     1,114     16     1,108     1996     2011   35 years

7300

 

Canyon Creek Inn Memory Care

  Billings   MT         420     11,217         420     11,217     11,637     90     11,547     2011     2011   35 years

2240

 

Rainbow Retirement Community

  Great Falls   MT         386     5,254     573     386     5,827     6,213     305     5,908     1998     2010   35 years

7090

 

Carillon ALF of Asheboro

  Asheboro   NC         680     15,370         680     15,370     16,050     245     15,952     1998     2011   35 years

3802

 

Elmcroft of Little Avenue

  Charlotte   NC         250     5,077         250     5,077     5,327     749     4,578     1997     2006   35 years

7093

 

Carillon ALF of Cramer Mountain

  Cramerton   NC         530     18,225         530     18,225     18,755     293     19,479     1999     2011   35 years

7092

 

Carillon ALF of Harrisburg

  Harrisburg   NC         1,660     15,130         1,660     15,130     16,790     242     16,701     1997     2011   35 years

7097

 

Carillon ALF of Hendersonville

  Hendersonville   NC         2,210     7,372         2,210     7,372     9,582     134     12,713     2005     2011   35 years

7098

 

Carillon ALF of Hillsborough

  Hillsborough   NC         1,450     19,754         1,450     19,754     21,204     310     21,088     2005     2011   35 years

7095

 

Carillon ALF of Newton

  Newton   NC         540     14,935         540     14,935     15,475     238     16,504     2000     2011   35 years

3846

 

Elmcroft of Northridge

  Raleigh   NC         184     3,592         184     3,592     3,776     530     3,246     1984     2006   35 years

7091

 

Carillon ALF of Salisbury

  Salisbury   NC         1,580     25,026         1,580     25,026     26,606     390     26,459     1999     2011   35 years

7094

 

Carillon ALF of Shelby

  Shelby   NC         660     15,471         660     15,471     16,131     247     16,257     2000     2011   35 years

3866

 

Elmcroft of Southern Pines

  Southern Pines   NC         1,196     10,766         1,196     10,766     11,962     538     11,424     1998     2010   35 years

7096

 

Carillon ALF of Southport

  Southport   NC         1,330     10,356         1,330     10,356     11,686     177     14,087     2005     2011   35 years

7422

 

Primrose Bismarck

  Bismarck   ND         1,210     9,768         1,210     9,768     10,978     158     10,921     1994     2011   35 years

3602

 

Crown Pointe

  Omaha   NE         1,316     11,950         1,316     11,950     13,266     2,305     10,961     1985     2005   35 years

7020

 

Brandywine at Brick

  Brick   NJ         1,490     16,747         1,490     16,747     18,237     256     18,091     1999     2011   35 years

3890

 

Elmcroft of Quintessence

  Albuquerque   NM         1,150     26,527         1,150     26,527     27,677     411     27,521     1998     2011   35 years

2233

 

Cottonbloom Assisted Living

  Las Cruces   NM         153     897     109     153     1,006     1,159     79     1,080     1996     2009   35 years

2239

 

Peachtree Village Retirement Community

  Roswell   NM         161     2,161     193     161     2,354     2,515     135     2,380     1999     2010   35 years

3600

 

The Amberleigh

  Amherst   NY         3,498     19,097         3,498     19,097     22,595     3,883     18,712     1988     2005   35 years

7290

 

Castle Gardens

  Vestal   NY         1,830     20,312         1,830     20,312     22,142     333     21,993     1994     2011   35 years

2819

 

Inn at Lakeview

  Grovepoint   OH         770     11,220         770     11,220     11,990     187     13,401     1998     2011   35 years

3847

 

Elmcroft of Lima

  Lima   OH         490     3,368         490     3,368     3,858     497     3,361     1998     2006   35 years

3885

 

Elmcroft of Lorain

  Lorain   OH         500     15,461         500     15,461     15,961     256     15,851     2000     2011   35 years

3812

 

Elmcroft of Ontario

  Mansfield   OH         523     7,968         523     7,968     8,491     1,176     7,315     1998     2006   35 years

2817

 

Summerville at Camelot Place

  Medina   OH         340     21,566         340     21,566     21,906     340     21,758     1995     2011   35 years

2821

 

Inn at Medina

  Medina   OH         1,110     24,700         1,110     24,700     25,810     384     25,652     2000     2011   35 years

3813

 

Elmcroft of Medina

  Medina   OH         661     9,788         661     9,788     10,449     1,445     9,004     1999     2006   35 years

3814

 

Elmcroft of Washington Township

  Miamisburg   OH         1,235     12,611         1,235     12,611     13,846     1,862     11,984     1998     2006   35 years

2818

 

Hillenvale

  Mt. Vernon   OH         1,100     12,493         1,100     12,493     13,593     206     14,361     2001     2011   35 years

3816

 

Elmcroft of Sagamore Hills

  Sagamore Hills   OH         980     12,604         980     12,604     13,584     1,861     11,723     2000     2006   35 years

3848

 

Elmcroft of Xenia

  Xenia   OH         653     2,801         653     2,801     3,454     414     3,040     1999     2006   35 years

2822

 

Inn at North Hills

  Zanesville   OH         1,560     11,067         1,560     11,067     12,627     189     14,318     1996     2011   35 years

3889

 

Elmcroft of Quail Springs

  Oklahoma   OK         500     16,632         500     16,632     17,132     273     17,017     1999     2011   35 years

7349

 

Southern Hills Nursing Center

  Tulsa   OK         750     10,739         750     10,739     11,489     216     11,377     1981     2011   35 years

1518

 

Avamere at Hillsboro

  Hillsboro   OR         4,400     8,353         4,400     8,353     12,753     158     12,735     2000     2011   35 years

1526

 

Avamere court at Keizer

  Keizer   OR         1,260     30,183         1,260     30,183     31,443     498     31,317     1970     2011   35 years

1523

 

The Stafford

  Lake Oswego   OR         1,800     16,122         1,800     16,122     17,922     275     17,844     2008     2011   35 years

1527

 

The Pearl at Kruse Way

  Lake Oswego   OR         2,000     12,880         2,000     12,880     14,880     214     14,842     2005     2011   35 years

1525

 

Avamere at Three Fountains

  Medford   OR         2,340     33,187         2,340     33,187     35,527     541     35,407     1974     2011   35 years

1521

 

Avamere at Newberg

  Newberg   OR         1,320     4,664         1,320     4,664     5,984     93     5,957     1999     2011   35 years

185


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

1524

 

Avamere Living at Berry Park

  Oregon City   OR         1,910     4,249         1,910     4,249     6,159     96     6,131     1972     2011   35 years

1516

 

Avamere at Bethany

  Portland   OR         3,150     16,740         3,150     16,740     19,890     282     19,826     2002     2011   35 years

1520

 

Avamere at Sandy

  Sandy   OR         1,000     7,309         1,000     7,309     8,309     133     8,268     1999     2011   35 years

1522

 

Suzanne Elise ALF

  Seaside   OR         1,940     4,027         1,940     4,027     5,967     93     5,940     1998     2011   35 years

1519

 

Avamere at Sherwood

  Sherwood   OR         1,010     7,051         1,010     7,051     8,061     129     8,021     2000     2011   35 years

7483

 

Chateau Gardens

  Springfield   OR         1,550     4,197         1,550     4,197     5,747     69     5,806     1991     2011   35 years

1517

 

Avamere at St Helens

  St. Helens   OR         1,410     10,496         1,410     10,496     11,906     179     11,857     2000     2011   35 years

3849

 

Elmcroft of Allison Park

  Allison Park   PA         1,171     5,686         1,171     5,686     6,857     839     6,018     1986     2006   35 years

3853

 

Elmcroft of Chippewa

  Beaver Falls   PA         1,394     8,586         1,394     8,586     9,980     1,267     8,713     1998     2006   35 years

3851

 

Elmcroft of Berwick

  Berwick   PA         111     6,741         111     6,741     6,852     995     5,857     1998     2006   35 years

1703

 

Outlook Pointe at Lakemont

  Bridgeville   PA         1,660     12,624         1,660     12,624     14,284     222     15,011     1999     2011   35 years

3817

 

Elmcroft of Dillsburg

  Dillsburg   PA         432     7,797         432     7,797     8,229     1,151     7,078     1998     2006   35 years

3850

 

Elmcroft of Altoona

  Duncansville   PA         331     4,729         331     4,729     5,060     698     4,362     1997     2006   35 years

3111

 

Moorehead House

  Indiana   PA         550     15,804         550     15,804     16,354     241     16,257     1997     2011   35 years

7223

 

Laurels at Kingston

  Kingston   PA         1,020     3,080         1,020     3,080     4,100     77     4,091     1992     2011   35 years

3818

 

Elmcroft of Lebanon

  Lebanon   PA         240     7,336         240     7,336     7,576     1,083     6,493     1999     2006   35 years

3854

 

Elmcroft of Lewisburg

  Lewisburg   PA         232     5,666         232     5,666     5,898     836     5,062     1999     2006   35 years

3855

 

Elmcroft of Reedsville

  Lewistown   PA         189     5,170         189     5,170     5,359     763     4,596     1998     2006   35 years

2502

 

Lehigh Commons

  Macungie   PA         420     4,406     450     420     4,856     5,276     1,330     3,946     1997     2004   30 years

3856

 

Elmcroft of Loyalsock

  Montoursville   PA         413     3,412         413     3,412     3,825     504     3,321     1999     2006   35 years

7224

 

Laurels at Old Forge

  Old Forge   PA         210     1,806         210     1,806     2,016     43     1,992     1990     2011   35 years

2504

 

Highgate at Paoli Pointe

  Paoli   PA         1,151     9,079         1,151     9,079     10,230     2,578     7,652     1997     2004   30 years

7221

 

Laurels at Mid Valley

  Peckville   PA         500     2,885         500     2,885     3,385     67     3,509     1989     2011   35 years

2503

 

Sanatoga Court

  Pottstown   PA         360     3,233         360     3,233     3,593     996     2,597     1997     2004   30 years

2501

 

Berkshire Commons

  Reading   PA         470     4,301         470     4,301     4,771     1,322     3,449     1997     2004   30 years

3857

 

Elmcroft of Reading

  Reading   PA         638     4,942         638     4,942     5,580     730     4,850     1998     2006   35 years

3858

 

Elmcroft of Saxonburg

  Saxonburg   PA         770     5,949         770     5,949     6,719     878     5,841     1994     2006   35 years

2511

 

Mifflin Court

  Shillington   PA         689     4,265     351     689     4,616     5,305     1,084     4,221     1997     2004   35 years

3815

 

Elmcroft of Shippensburg

  Shippensburg   PA         203     7,634         203     7,634     7,837     1,127     6,710     1999     2006   35 years

3860

 

Elmcroft of State College

  State College   PA         320     7,407         320     7,407     7,727     1,093     6,634     1997     2006   35 years

7225

 

Laurels at Wyoming

  Wyoming   PA         140     2,107         140     2,107     2,247     49     2,400     1993     2011   35 years

1704

 

Outlook Pointe at York

  York   PA         1,260     6,923         1,260     6,923     8,183     121     8,340     1999     2011   35 years

3108

 

Langston House

  Clinton   SC         470     1,773         470     1,773     2,243     39     2,224     1997     2011   35 years

3803

 

Elmcroft of Florence SC

  Florence   SC         108     7,620         108     7,620     7,728     1,125     6,603     1998     2006   35 years

3110

 

Pinewood House

  Goose Creek   SC         1,170     11,629         1,170     11,629     12,799     180     12,732     1998     2011   35 years

3109

 

Ashley House

  Greenwood   SC         540     1,446         540     1,446     1,986     35     2,290     1997     2011   35 years

3105

 

The Inn at Seneca

  Seneca   SC         365     2,768         365     2,768     3,133     631     2,502     1999     2005   35 years

7420

 

Primrose Aberdeen

  Aberdeen   SD         850     659         850     659     1,509     26     4,602     1991     2011   35 years

7425

 

Primrose Place

  Aberdeen   SD         310     3,242         310     3,242     3,552     55     3,797     2000     2011   35 years

7426

 

Primrose Rapid City

  Rapid City   SD         860     8,722         860     8,722     9,582     147     9,524     1997     2011   35 years

186


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

7427

 

Primrose Sioux Falls

  Sioux Falls   SD         2,180     12,936         2,180     12,936     15,116     221     15,034     2002     2011   35 years

3868

 

Elmcroft of Bartlett

  Bartlett   TN         570     25,552         570     25,552     26,122     397     25,965     1999     2011   35 years

1706

 

Outlook Pointe of Bristol

  Bristol   TN         470     16,006         470     16,006     16,476     253     16,374     1999     2011   35 years

3804

 

Elmcroft of Hamilton Place

  Chattanooga   TN         87     4,248         87     4,248     4,335     627     3,708     1998     2006   35 years

3875

 

Elmcroft of Shallowford

  Chattanooga   TN         580     7,568         580     7,568     8,148     139     8,084     1999     2011   35 years

7634

 

Regency House

  Hixson   TN         140     6,611         140     6,611     6,751     109     7,329     2000     2011   35 years

1710

 

Outlook Pointe at Johnson City

  Johnson City   TN         590     10,043         590     10,043     10,633     164     10,567     1999     2011   35 years

3819

 

Elmcroft of Kingsport

  Kingsport   TN         22     7,815         22     7,815     7,837     1,154     6,683     2000     2006   35 years

3862

 

Elmcroft of West Knoxville

  Knoxville   TN         439     10,697         439     10,697     11,136     1,579     9,557     2000     2006   35 years

3863

 

Elmcroft of Lebanon

  Lebanon   TN         180     7,086         180     7,086     7,266     1,046     6,220     2000     2006   35 years

3892

 

Elmcroft of Twin Hills

  Madison   TN         860     8,208         860     8,208     9,068     150     9,002     1999     2011   35 years

7630

 

Kennington Place

  Memphis   TN         1,820     4,748         1,820     4,748     6,568     126     6,497     1989     2011   35 years

7631

 

Heritage Place

  Memphis   TN         2,250     3,333         2,250     3,333     5,583     108     5,521     1985     2011   35 years

7632

 

Franklin Park

  Memphis   TN         1,240     2,657         1,240     2,657     3,897     83     3,847     1989     2011   35 years

7633

 

Glenmary Senior Manor

  Memphis   TN         510     5,860         510     5,860     6,370     132     6,295     1964     2011   35 years

1705

 

Outlook Pointe at Murfreesboro

  Murfreesboro   TN         940     8,030         940     8,030     8,970     137     9,439     1999     2011   35 years

3871

 

Elmcroft of Brentwood

  Nashville   TN         960     22,020         960     22,020     22,980     347     22,844     1998     2011   35 years

3923

 

Trenton Health Care Center

  Trenton   TN         460     6,058         460     6,058     6,518     114     6,972     1974     2011   35 years

3899

 

Elmcroft of Arlington

  Arlington   TX         2,650     14,060         2,650     14,060     16,710     235     16,629     1998     2011   35 years

3867

 

Elmcroft of Austin

  Austin   TX         2,770     25,820         2,770     25,820     28,590     405     28,448     2000     2011   35 years

3869

 

Elmcroft of Bedford

  Bedford   TX     7,728     770     19,691         770     19,691     20,461     314     20,335     1999     2011   35 years

3893

 

Elmcroft of Rivershire

  Conroe   TX         860     32,671     4     860     32,675     33,535     505     33,338     1997     2011   35 years

7605

 

Heritage Oaks Retirement Village

  Corsicana   TX         790     30,636         790     30,636     31,426     489     31,240     1996     2011   35 years

7484

 

Flower Mound

  Flower Mound   TX         900     5,512         900     5,512     6,412     92     6,380     1995     2011   35 years

3879

 

Elmcroft of Garland

  Garland   TX         850     12,482         850     12,482     13,332     211     13,244     1999     2011   35 years

3870

 

Elmcroft of Braeswood

  Houston   TX         3,970     15,919         3,970     15,919     19,889     260     19,811     1999     2011   35 years

3877

 

Elmcroft of Cy-Fair

  Houston   TX         1,580     21,801     9     1,580     21,810     23,390     344     23,261     1998     2011   35 years

3882

 

Elmcroft of Irving

  Irving   TX         1,620     18,755     2     1,620     18,757     20,377     299     20,265     1999     2011   35 years

3610

 

Whitley Place

  Keller   TX             5,100             5,100     5,100     571     4,529     1998     2008   35 years

3884

 

Elmcroft of Lake Jackson

  Lake Jackson   TX         710     14,765         710     14,765     15,475     240     15,378     1998     2011   35 years

3896

 

Elmcroft of Vista Ridge

  Lewisville   TX         6,280     10,548     3     6,280     10,551     16,831     183     16,803     1998     2011   35 years

3897

 

Elmcroft of Windcrest

  San Antonio   TX         920     13,011     20     920     13,031     13,951     216     13,863     1999     2011   35 years

3876

 

Elmcroft of Cottonwood

  Temple   TX         630     17,515         630     17,515     18,145     279     18,033     1997     2011   35 years

3886

 

Elmcroft of Mainland

  Texas City   TX         520     14,849         520     14,849     15,369     241     15,270     1996     2011   35 years

3895

 

Elmcroft of Victoria

  Victoria   TX         440     13,040         440     13,040     13,480     213     13,390     1997     2011   35 years

3872

 

Elmcroft of Wharton

  Wharton   TX         320     13,799         320     13,799     14,119     224     14,025     1996     2011   35 years

3865

 

Elmcroft of Chesterfield

  Richmond   VA         829     6,534         829     6,534     7,363     965     6,398     1999     2006   35 years

2820

 

Summerville at Ridgewood

  Salem   VA         1,900     16,219         1,900     16,219     18,119     252     18,107     1998     2011   35 years

1717

 

Cooks Hill Manor

  Cetralia   WA         520     6,144         520     6,144     6,664     111     7,858     1993     2011   35 years

1716

 

The Sequoia

  Olympia   WA         1,490     13,724         1,490     13,724     15,214     231     17,082     1995     2011   35 years

1713

 

Birchview

  Sedro Wolley   WA         210     14,145         210     14,145     14,355     217     14,270     1996     2011   35 years

1718

 

Discovery Memory care

  Sequim   WA         320     10,544         320     10,544     10,864     170     10,794     1961     2011   35 years

7370

 

The Academy Retirement Comm

  Spokane   WA         650     3,741         650     3,741     4,391     82     5,593     1959     2011   35 years

1715

 

The Village Retirement & Assisted Living

  Tacoma   WA         2,200     5,938         2,200     5,938     8,138     133     13,733     1976     2011   35 years

1611

 

Jansen House

  Appleton   WI         130     1,834         130     1,834     1,964     33     1,960     1996     2011   35 years

1612

 

Margaret house

  Appleton   WI         140     2,016         140     2,016     2,156     36     2,151     1997     2011   35 years

7590

 

Hunters Ridge

  Beaver Dam   WI         260     2,380         260     2,380     2,640     41     2,631     1998     2011   35 years

7033

 

Harbor House Beloit

  Beloit   WI         150     4,356         150     4,356     4,506     69     4,480     1990     2011   35 years

7032

 

Harbor House Clinton

  Clinton   WI         290     4,390         290     4,390     4,680     70     4,654     1991     2011   35 years

7591

 

Creekside

  Cudahy   WI         760     1,693         760     1,693     2,453     32     2,519     2001     2011   35 years

1631

 

Harmony of Denmark

  Denmark   WI     1,182     220     2,228         220     2,228     2,448     39     2,537     1995     2011   35 years

7035

 

Harbor House Eau Claire

  Eau Claire   WI         210     6,259         210     6,259     6,469     97     6,434     1996     2011   35 years

7592

 

Chapel Valley

  Fitchburg   WI         450     2,372         450     2,372     2,822     42     2,925     1998     2011   35 years

1642

 

Harmony of Brenwood Park

  Franklin   WI     6,174     1,870     13,804         1,870     13,804     15,674     214     15,607     2003     2011   35 years

187


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

1601

 

Windsor House of Glendale East

  Glendale   WI         1,810     943         1,810     943     2,753     21     2,772     1999     2011   35 years

1602

 

Windsor House of Glendale West

  Glendale   WI         1,800     935         1,800     935     2,735     21     2,754     1999     2011   35 years

7321

 

Laurel Oaks

  Glendale   WI         2,390     43,587         2,390     43,587     45,977     689     45,728     1988     2011   35 years

1630

 

Harmony of Green Bay

  Green Bay   WI     3,077     640     5,008         640     5,008     5,648     84     6,174     1990     2011   35 years

7326

 

Layton Terrace

  Greenfield   WI     8,160     3,490     39,201         3,490     39,201     42,691     632     42,467     1999     2011   35 years

1600

 

Cambridge House

  Hartland   WI         640     1,663         640     1,663     2,303     34     3,309     1985     2011   35 years

1606

 

Winchester Place

  Horicon   WI         340     3,327         340     3,327     3,667     61     3,659     2002     2011   35 years

7593

 

Jefferson

  Jefferson   WI         330     2,384         330     2,384     2,714     41     2,706     1997     2011   35 years

1645

 

Harmony of Kenosha

  Kenosha   WI     4,005     1,180     8,717         1,180     8,717     9,897     138     9,852     1999     2011   35 years

7030

 

Harbor House Kenosha

  Kenosha   WI         710     3,254         710     3,254     3,964     54     4,593     1996     2011   35 years

1637

 

Harmony Commons of Stevens Point

  Madison   WI         760     2,242         760     2,242     3,002     48     4,582     2005     2011   35 years

1638

 

Harmony of Madison

  Madison   WI     4,146     650     4,279         650     4,279     4,929     77     6,272     1998     2011   35 years

1633

 

Harmony of Manitowoc

  Manitowoc   WI     4,866     450     10,101         450     10,101     10,551     159     10,491     1997     2011   35 years

7039

 

Harbor House Manitowoc

  Manitowoc   WI         140     1,520         140     1,520     1,660     25     1,651     1997     2011   35 years

1647

 

Harmony of McFarland

  McFarland   WI     3,717     640     4,647         640     4,647     5,287     80     6,193     1998     2011   35 years

1614

 

Acorn Ridge

  Menasha   WI         110     537         110     537     647     11     877     1994     2011   35 years

1615

 

Emeral Ridge

  Menasha   WI         110     537         110     537     647     11     869     1994     2011   35 years

1616

 

Silver Ridge

  Menasha   WI         90     557         90     557     647     12     966     1993     2011   35 years

1617

 

West Ridge

  Menasha   WI         90     557         90     557     647     12     982     1993     2011   35 years

1639

 

Riverview Village

  Menomonee Falls   WI     5,892     2,170     11,758         2,170     11,758     13,928     184     13,875     2003     2011   35 years

7322

 

The Arboretum

  Menomonee Falls   WI     8,545     5,640     49,083         5,640     49,083     54,723     813     54,434     1989     2011   35 years

7034

 

Harbor House Monroe

  Monroe   WI         490     4,964         490     4,964     5,454     80     5,426     1990     2011   35 years

1608

 

Phyllis Elaine

  Neenah   WI         710     1,157         710     1,157     1,867     24     1,955     2006     2011   35 years

1609

 

Judy Harris

  Neenah   WI         720     2,339         720     2,339     3,059     43     3,061     2007     2011   35 years

1613

 

Irish Road

  Neenah   WI         320     1,036         320     1,036     1,356     22     2,127     2001     2011   35 years

1603

 

Windsor House Oak Creek

  Oak Creek   WI         800     2,167         800     2,167     2,967     38     2,972     1997     2011   35 years

7325

 

Wilkinson Woods of Oconomowoc

  Oconomowoc   WI         1,100     12,436         1,100     12,436     13,536     199     13,466     1992     2011   35 years

7036

 

Harbor House Oshkosh

  Oshkosh   WI         190     949         190     949     1,139     21     1,688     1993     2011   35 years

1607

 

Wyndham House

  Pewaukee   WI         1,180     4,124         1,180     4,124     5,304     75     5,561     2001     2011   35 years

1643

 

Harmony of Racine

  Racine   WI     9,747     590     11,726         590     11,726     12,316     182     12,249     1998     2011   35 years

1644

 

Harmony of Commons of Racine

  Racine   WI         630     11,245         630     11,245     11,875     176     11,810     2003     2011   35 years

7037

 

Harbor House Rib Mountain

  Rib Mountain   WI         350     3,413         350     3,413     3,763     56     3,742     1997     2011   35 years

1634

 

Harmony of Sheboygan

  Sheboygan   WI     9,019     810     17,908         810     17,908     18,718     279     18,614     1996     2011   35 years

7038

 

Harbor House Sheboygan

  Sheboygan   WI         1,060     6,208         1,060     6,208     7,268     98     7,239     1995     2011   35 years

1604

 

Windsor House of St. Francis I

  St. Francis   WI         1,370     1,428         1,370     1,428     2,798     28     2,897     2000     2011   35 years

1605

 

Windsor House of St. Francis II

  St. Francis   WI         1,370     1,666         1,370     1,666     3,036     31     3,049     2000     2011   35 years

7324

 

Howard Village of St. Francis

  St. Francis   WI     5,760     2,320     17,232         2,320     17,232     19,552     286     19,453     2001     2011   35 years

1636

 

Harmony of Stevens Point

  Stevens Point   WI     8,231     790     10,081         790     10,081     10,871     162     11,578     2002     2011   35 years

1646

 

Harmony of Stoughton

  Stoughton   WI     1,635     490     9,298         490     9,298     9,788     147     9,733     1997     2011   35 years

7031

 

Harbor House Stoughton

  Stoughton   WI         450     3,191         450     3,191     3,641     56     3,889     1992     2011   35 years

1632

 

Harmony of Two Rivers

  Two Rivers   WI     2,626     330     3,538         330     3,538     3,868     60     4,444     1998     2011   35 years

7320

 

Oak Hill Terrace

  Waukesha   WI     5,350     2,040     40,298         2,040     40,298     42,338     652     42,091     1985     2011   35 years

1640

 

Harmony of Terrace Court

  Wausau   WI     7,325     430     5,037         430     5,037     5,467     83     5,815     1996     2011   35 years

1641

 

Harmony of Terrace Commons

  Wausau   WI         740     6,556         740     6,556     7,296     109     8,022     2000     2011   35 years

7327

 

Hart Park Square

  Wauwatosa   WI     6,600     1,900     21,628         1,900     21,628     23,528     351     23,402     2005     2011   35 years

7323

 

Library Square

  West Allis   WI     5,150     1,160     23,714         1,160     23,714     24,874     384     24,728     1996     2011   35 years

1635

 

Harmony of Wisconsin Rapids

  Wisconsin Rapids   WI     1,095     520     4,349         520     4,349     4,869     76     4,838     2000     2011   35 years

1610

 

Wrightstown

  Wrightstown   WI         140     376         140     376     516     12     1,158     1999     2011   35 years

1711

 

Outlook Pointe at Teays Valley

  Hurricane   WV         1,950     14,489         1,950     14,489     16,439     228     16,362     1999     2011   35 years

3820

 

Elmcroft of Martinsburg

  Martinsburg   WV         248     8,320         248     8,320     8,568     1,228     7,340     1999     2006   35 years

7487

 

Garden Square Assisted Living of Casper

  Casper   WY         355     3,197         355     3,197     3,552         3,600     1996     2011   35 years
                                                                 

 

TOTAL FOR OTHER SENIORS HOUSING COMMUNITIES

            249,542     371,851     3,105,390     14,498     371,851     3,119,888     3,491,739     182,115     3,405,608                

 

TOTAL FOR SENIORS HOUSING COMMUNITIES

           
2,374,138
   
1,144,232
   
10,390,029
   
80,091
   
1,144,399
   
10,469,953
   
11,614,352
   
939,516
   
10,883,717
               

188


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

 

PERSONAL CARE FACILITIES

                                                                             

3721

 

ResCare Tangram—Ranch

  Kingsbury   TX         147     806         147     806     953     534     419     N/A     1998   20 years

3722

 

ResCare Tangram—Mesquite

  Kingsbury   TX         15     1,078         15     1,078     1,093     714     379     N/A     1998   20 years

3723

 

ResCare Tangram—Hacienda

  Kingsbury   TX         31     841         31     841     872     557     315     N/A     1998   20 years

3726

 

ResCare Tangram—Loma Linda

  Kingsbury   TX         40     220         40     220     260     146     114     N/A     1998   20 years

3724

 

ResCare Tangram—Texas Hill Country School

  Maxwell   TX         54     934         54     934     988     619     369     N/A     1998   20 years

3725

 

ResCare Tangram—Chaparral

  Maxwell   TX         82     552         82     552     634     366     268     N/A     1998   20 years

3727

 

ResCare Tangram—Sierra Verde & Roca Vista

  Maxwell   TX         20     910         20     910     930     603     327     N/A     1998   20 years

3719

 

ResCare Tangram—618 W. Hutchinson

  San Marcos   TX         226     1,175         226     1,175     1,401     779     622     N/A     1998   20 years
                                                                 

 

TOTAL FOR PERSONAL CARE FACILITIES

                615     6,516         615     6,516     7,131     4,318     2,813                

 

MEDICAL OFFICE BUILDINGS

                                                                             

6370

 

St. Vincent's Medical Center East #46

  Birmingham   AL             25,298     952         26,250     26,250     1,552     29,066     2005     2010   35 years

6371

 

St. Vincent's Medical Center East #48

  Birmingham   AL             12,698     21         12,719     12,719     917     12,872     1989     2010   35 years

6372

 

St. Vincent's Medical Center East #52

  Birmingham   AL             7,608     483         8,091     8,091     691     8,283     1985     2010   35 years

3065

 

Crestwood Medical Pavilion

  Huntsville   AL     5,684     625     16,178         625     16,178     16,803     288     18,145     1994     2011   35 years

6822

 

Mercy Gilbert Medical Plaza

  Gilbert   AZ         720     11,277     14     720     11,291     12,011     234     17,518     2007     2011   35 years

5001

 

Arrowhead Orchards MOB-A

  Glendale   AZ         825     6,624         825     6,624     7,449     46     8,574     2003     2011   35 years

5002

 

Arrowhead Orchards MOB-B

  Glendale   AZ         744     6,045         744     6,045     6,789     39     7,356     2006     2011   35 years

6707

 

Thunderbird Paseo Medical Plaza

  Glendale   AZ     10,268         12,904             12,904     12,904         15,175     1997     2011   35 years

6708

 

Thunderbird Paseo Medical Plaza II

  Glendale   AZ     6,732         8,100             8,100     8,100         9,504     2001     2011   35 years

6711

 

Cobre Valley Medical Plaza

  Globe   AZ     2,480         3,785             3,785     3,785         4,026     1998     2011   35 years

6700

 

Desert Samaritan Medical Building I

  Mesa   AZ     8,011         11,923             11,923     11,923         12,837     1977     2011   35 years

6701

 

Desert Samaritan Medical Building II

  Mesa   AZ     5,965         7,395             7,395     7,395         8,662     1980     2011   35 years

6702

 

Desert Samaritan Medical Building III

  Mesa   AZ     10,242         13,665             13,665     13,665         15,082     1986     2011   35 years

6703

 

Deer Valley Medical Office Building II

  Phoenix   AZ     14,177         22,663             22,663     22,663     75     24,820     2002     2011   35 years

6704

 

Deer Valley Medical Office Building III

  Phoenix   AZ     11,687         19,521             19,521     19,521     57     21,153     2009     2011   35 years

6706

 

Edwards Medical Plaza

  Phoenix   AZ     12,702         18,999             18,999     18,999     81     20,912     1984     2011   35 years

6710

 

Papago Medical Park

  Phoenix   AZ     7,616         12,172             12,172     12,172         13,613     1989     2011   35 years

6809

 

Burbank Medical Plaza

  Burbank   CA     13,521     1,241     23,322         1,241     23,322     24,563     479     33,803     2004     2011   35 years

6827

 

Burbank Medical Plaza II

  Burbank   CA     30,346     491     45,641     632     491     46,273     46,764     751     51,201     2008     2011   35 years

6808

 

Eden Medical Plaza

  Castro Valley   CA         258     2,455     71     258     2,526     2,784     83     6,361     1998     2011   25 years

6828

 

Sutter Medical Center

  Castro Valley   CA     4,208             10,656         10,656     10,656         10,656     CIP     2011   CIP

6818

 

PMB Chula Vista

  Chula Vista   CA     15,985     2,964     19,393     13     2,964     19,406     22,370     398     24,396     2001     2011   35 years

6810

 

St. Francis Lynwood Medical

  Lynwood   CA     9,264     688     8,385     112     688     8,497     9,185     242     16,336     1993     2011   32 years

6824

 

PMB Mission Hills

  Mission Hills   CA     15,299     15,468         16,514     15,468     16,514     31,982         31,982     CIP     2011   CIP

6816

 

PDP Mission Viejo

  Mission Viejo   CA     46,731     1,916     77,022     19     1,916     77,041     78,957     1,302     93,611     2007     2011   35 years

6817

 

PDP Orange

  Orange   CA     49,051     1,752     61,647         1,752     61,647     63,399     1,085     75,140     2008     2011   35 years

6823

 

NHP/PMB Pasadena

  Pasadena   CA         3,138     83,412     932     3,138     84,344     87,482     1,473     105,125     2009     2011   35 years

6826

 

Western University of Health Sciences Medical Pavilion

  Pomona   CA         91     31,523         91     31,523     31,614     504     36,076     2009     2011   35 years

6815

 

Pomerado Outpatient Pavilion

  Poway   CA         3,233     71,435         3,233     71,435     74,668     1,299     86,865     2007     2011   35 years

189


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

6820

 

NHP SB 399-401 East Highland

  San Bernardino   CA         789     11,133     95     789     11,228     12,017     351     17,166     1971     2011   27 years

6821

 

NHP SB 399-401 East Highland

  San Bernardino   CA         416     5,625     104     416     5,729     6,145     194     9,096     1988     2011   26 years

6811

 

San Gabriel Valley Medical

  San Gabriel   CA     9,475     914     5,510     71     914     5,581     6,495     172     16,761     2004     2011   35 years

6812

 

Santa Clarita Valley Medical

  Santa Clarita   CA     23,022     9,708     20,020     6     9,708     20,026     29,734     390     33,126     2005     2011   35 years

6825

 

Kenneth E Watts Medical Plaza

  Torrance   CA         262     6,945     78     262     7,023     7,285     212     11,715     1989     2011   23 years

2951

 

Potomac Medical Plaza

  Aurora   CO         2,401     9,118     1,417     2,442     10,494     12,936     2,901     10,092     1986     2007   35 years

2952

 

Briargate Medical Campus

  Colorado Springs   CO         1,238     12,301     238     1,244     12,533     13,777     2,177     11,828     2002     2007   35 years

2953

 

Printers Park Medical Plaza

  Colorado Springs   CO         2,641     47,507     678     2,641     48,185     50,826     8,147     44,367     1999     2007   35 years

6310

 

Community Physicians Pavilion

  Lafayette   CO             10,436     797         11,233     11,233     639     11,032     2004     2010   35 years

2956

 

Avista Two Medical Plaza

  Louisville   CO             17,330     1,312         18,642     18,642     1,696     18,873     2003     2009   35 years

3071

 

The Sierra Medical Building

  Parker   CO     11,734     1,444     14,059     2,362     1,444     16,421     17,865     1,631     16,234     2009     2009   35 years

6320

 

Lutheran Medical Office Building II

  Wheat Ridge   CO             2,655     619         3,274     3,274     247     3,512     1976     2010   35 years

6321

 

Lutheran Medical Office Building IV

  Wheat Ridge   CO             7,266     362         7,628     7,628     441     8,250     1991     2010   35 years

6322

 

Lutheran Medical Office Building III

  Wheat Ridge   CO             11,947             11,947     11,947     777     12,536     2004     2010   35 years

6390

 

DePaul Professional Office Building

  Washington   DC             6,424     453         6,877     6,877     934     7,168     1987     2010   35 years

6391

 

Providence Medical Office Building

  Washington   DC             2,473     123         2,596     2,596     450     2,661     1975     2010   35 years

2930

 

RTS Arcadia

  Arcadia   FL         345     2,884         345     2,884     3,229     59     3,471     1993     2011   30 years

2907

 

Aventura Heart & Health

  Aventura   FL     16,764         25,361     2,763         28,124     28,124     4,968     24,068     2006     2007   35 years

2932

 

RTS Cape Coral

  Cape Coral   FL         368     5,448         368     5,448     5,816     95     6,217     1984     2011   34 years

2933

 

RTS Englewood

  Englewood   FL         1,071     3,516         1,071     3,516     4,587     65     4,911     1992     2011   35 years

2934

 

RTS Ft. Myers

  Ft. Myers   FL         1,153     4,127         1,153     4,127     5,280     86     5,635     1989     2011   31 years

2935

 

RTS Key West

  Key West   FL         486     4,380         486     4,380     4,866     68     5,174     1987     2011   35 years

2902

 

JFK Medical Plaza

  Lake Worth   FL         453     1,711     139     453     1,850     2,303     421     1,882     1999     2004   35 years

2903

 

Palms West Building 6

  Loxahatchee   FL         965     2,678     38     965     2,716     3,681     579     3,102     2000     2004   35 years

2904

 

Regency Medical Office Park Phase II

  Melbourne   FL         770     3,809     188     781     3,986     4,767     805     3,962     1998     2004   35 years

2905

 

Regency Medical Office Park Phase I

  Melbourne   FL         590     3,156     97     603     3,240     3,843     666     3,177     1995     2004   35 years

2938

 

RTS Naples

  Naples   FL         1,152     3,726         1,152     3,726     4,878     65     5,204     1999     2011   35 years

2939

 

RTS Pt. Charlotte

  Pt. Charlotte   FL         966     4,581         966     4,581     5,547     84     5,942     1985     2011   34 years

2940

 

RTS Sarasota

  Sarasota   FL         1,914     3,889         1,914     3,889     5,803     76     6,821     1996     2011   35 years

2906

 

University Medical Office Building

  Tamarac   FL             6,690             6,690     6,690     1,136     5,876     2006     2007   35 years

3087

 

UMC Tamarac

  Tamarac   FL         2,039     2,936         2,039     2,936     4,975     101     5,109     1980     2011   22 years

2941

 

RTS Venice

  Venice   FL         1,536     4,104         1,536     4,104     5,640     77     6,050     1997     2011   35 years

3081

 

Augusta Medical Plaza

  Augusta   GA         594     4,847         594     4,847     5,441     160     5,923     1972     2011   25 years

3082

 

Augusta Professional Building

  Augusta   GA         687     6,057     16     687     6,073     6,760     200     7,802     1983     2011   27 years

3008

 

Cobb Physicians Center

  Austell   GA     9,030     1,145     16,805         1,145     16,805     17,950     436     21,407     1992     2011   35 years

3083

 

Columbia Medical Plaza

  Evans   GA         268     1,497         268     1,497     1,765     67     1,981     1940     2011   23 years

3009

 

Parkway Physicians Center

  Ringgold   GA     6,333     476     10,017         476     10,017     10,493     224     13,333     2004     2011   35 years

3006

 

Eastside Physicians Center

  Snellville   GA         1,289     25,019     634     1,289     25,653     26,942     3,350     23,795     1994     2008   35 years

3007

 

Eastside Physicians Plaza

  Snellville   GA     6,997     294     12,948     35     294     12,983     13,277     1,587     11,988     2003     2008   35 years

2977

 

Buffalo Grove Acute Care

  Buffalor Grove   IL         1,826     930     4     1,826     934     2,760     52     3,383     1992     2011   26 years

6400

 

Physicians Plaza East

  Decatur   IL     1,016         791     600         1,391     1,391     141     1,619     1976     2010   35 years

190


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

6401

 

Physicians Plaza West

  Decatur   IL     1,684         1,943     21         1,964     1,964     295     2,061     1987     2010   35 years

6402

 

Physicians and Dental Building

  Decatur   IL     406         676     1         677     677     118     705     1972     2010   35 years

6403

 

Monroe Medical Center

  Decatur   IL     87         93     34         127     127     26     130     1971     2010   35 years

6404

 

Kenwood Medical Center

  Decatur   IL     2,555         3,900     30         3,930     3,930     485     3,997     1996     2010   35 years

6405

 

304 W Hay Building

  Decatur   IL     5,458         8,702     1         8,703     8,703     655     9,134     2002     2010   35 years

6406

 

302 W Hay Building

  Decatur   IL     2,351         3,467     14         3,481     3,481     398     3,593     1993     2010   35 years

6407

 

ENTA

  Decatur   IL     639         1,150             1,150     1,150     83     1,180     1996     2010   35 years

6408

 

301 W Hay Building

  Decatur   IL     232         640             640     640     64     614     1980     2010   35 years

6409

 

South Shore Medical Building

  Decatur   IL     406     902     129         902     129     1,031     40     1,171     1991     2010   35 years

6410

 

SIU Family Practice

  Decatur   IL     900         1,689             1,689     1,689     263     1,380     1997     2010   35 years

6411

 

Corporate Health Services

  Decatur   IL     1,335     934     1,386         934     1,386     2,320     123     2,597     1996     2010   35 years

6412

 

Rock Springs Medical

  Decatur   IL     581     399     495         399     495     894     47     949     1990     2010   35 years

6420

 

575 W Hay Building

  Decatur   IL         111     739         111     739     850     59     881     1984     2010   35 years

2954

 

Eberle Medical Office Building ("Eberle MOB")

  Elk Grove Village   IL             16,315     50         16,365     16,365     2,130     15,122     2005     2009   35 years

2978

 

Grayslake MOB

  Grayslake   IL         2,740     2,002     3     2,740     2,005     4,745     111     5,531     1996     2011   25 years

2971

 

1425 Hunt Club Road MOB

  Gurnee   IL         249     1,452     1     249     1,453     1,702     49     2,487     2005     2011   34 years

2972

 

1445 Hunt Club Drive

  Gurnee   IL         216     1,405     1     216     1,406     1,622     50     2,353     2002     2011   31 years

2973

 

Gurnee Imaging Center

  Gurnee   IL         82     2,731         82     2,731     2,813     50     3,289     2002     2011   35 years

2974

 

Gurnee Center Club

  Gurnee   IL         627     17,851         627     17,851     18,478     346     21,810     2001     2011   35 years

2981

 

Gurnee Acute Care

  Gurnee   IL         166     1,115     1     166     1,116     1,282     46     2,397     1996     2011   30 years

2955

 

Doctors Office Building III ("DOB III")

  Hoffman Estates   IL             24,550     53         24,603     24,603     3,107     22,810     2005     2009   35 years

2970

 

755 Milwaukee MOB

  Libertyville   IL         421     3,716     267     421     3,983     4,404     169     8,063     1990     2011   18 years

2979

 

890 Professional MOB

  Libertyville   IL         214     2,630     7     214     2,637     2,851     84     4,181     1980     2011   26 years

2980

 

Libertyville Center Club

  Libertyville   IL         1,020     17,176         1,020     17,176     18,196     342     23,534     1988     2011   35 years

2975

 

Round Lake ACC

  Round Lake   IL         758     370     1     758     371     1,129     41     1,775     1984     2011   13 years

2976

 

Vernon Hills Acute Care Center

  Vernon Hills   IL         3,376     694     49     3,376     743     4,119     44     4,797     1986     2011   15 years

6300

 

Wilbur S. Roby Building

  Anderson   IN             2,653     97         2,750     2,750     275     2,480     1992     2010   35 years

6301

 

Ambulatory Services Building

  Anderson   IN             4,266     220         4,486     4,486     521     4,358     1995     2010   35 years

6302

 

St. John's Medical Arts Building

  Anderson   IN             2,281     140         2,421     2,421     292     2,082     1973     2010   35 years

3090

 

Elkhart

  Elkhart   IN     1,282     1,256     1,973         1,256     1,973     3,229     85     3,542     1994     2011   32 years

3091

 

LaPorte

  LaPorte   IN     797     553     1,309         553     1,309     1,862     37     2,078     1997     2011   34 years

3092

 

Mishawaka

  Mishawaka   IN     3,672     3,787     5,543         3,787     5,543     9,330     249     10,140     1993     2011   35 years

3093

 

South Bend

  South Bend   IN     1,511     792     2,530         792     2,530     3,322     59     3,668     1996     2011   34 years

6802

 

Lakeview MOB

  Covington   LA         1,838     5,508     101     1,838     5,609     7,447     179     8,488     1994     2011   28 years

6804

 

Medical Arts Courtyard

  Lafayette   LA         388     1,893     84     388     1,977     2,365     93     2,422     1984     2011   18 years

6805

 

SW Louisiana POB

  Lafayette   LA         867     5,010     514     867     5,524     6,391     210     6,691     1984     2011   18 years

6803

 

Lakeview Surgery Center

  Mandeville   LA         753     956     3     753     959     1,712     47     1,696     1987     2011   16 years

6800

 

Lakeside POB I

  Metairie   LA         3,334     4,974     99     3,334     5,073     8,407     208     9,297     1986     2011   22 years

6801

 

Lakeside POB II

  Metairie   LA         1,046     802     14     1,046     816     1,862     68     2,161     1980     2011   7 years

6806

 

Northshore I

  Slidell   LA         977     1,054     396     977     1,450     2,427     79     2,807     1986     2011   14 years

6807

 

Northshore II

  Slidell   LA         972     1,965     17     972     1,982     2,954     88     2,975     1990     2011   19 years

191


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

2931

 

RTS Berlin

  Berlin   MD             2,216             2,216     2,216     42     2,383     1994     2011   29 years

3015

 

Charles O. Fisher Medical Building

  Westminster   MD     11,857         13,795     485         14,280     14,280     1,503     14,679     2009     2009   35 years

6330

 

Medical Specialties Building

  Kalamazoo   MI             19,242     106         19,348     19,348     1,255     18,004     1989     2010   35 years

6331

 

North Professional Building

  Kalamazoo   MI             7,228     40         7,268     7,268     490     6,814     1983     2010   35 years

6332

 

Medical Commons Building

  Kalamazoo   MI             661     6         667     667     46     701     1979     2010   35 years

6333

 

Borgess Navigation Center

  Kalamazoo   MI             2,391             2,391     2,391     171     2,536     1976     2010   35 years

6334

 

Borgess Visiting Nurses

  Kalamazoo   MI         90     2,328         90     2,328     2,418     209     2,209     1900     2010   35 years

6337

 

Borgess Health & Fitness Center

  Kalamazoo   MI             11,959             11,959     11,959     843     12,733     1984     2010   35 years

6360

 

Heart Center Building

  Kalamazoo   MI             8,420     13         8,433     8,433     568     8,840     1980     2010   35 years

2936

 

RTS Madison Heights

  Madison Heights   MI         401     2,946         401     2,946     3,347     54     3,752     2002     2011   35 years

2937

 

RTS Monroe

  Monroe   MI         281     3,450         281     3,450     3,731     71     4,019     1997     2011   31 years

6336

 

Pro Med Center Plainwell

  Plainwell   MI             697             697     697     56     745     1991     2010   35 years

6335

 

Pro Med Center Richland

  Richland   MI         233     2,267     30     233     2,297     2,530     191     2,379     1996     2010   35 years

2986

 

Arnold Urgent Care

  Armold   MO         1,058     556     18     1,058     574     1,632     38     2,108     1999     2011   35 years

2987

 

Fenton Urgent Care Center

  Fenton   MO         183     2,714     1     183     2,715     2,898     79     3,715     2003     2011   35 years

2950

 

Broadway Medical Office Building

  Kansas City   MO     6,350     1,300     12,602     1,638     1,335     14,205     15,540     3,901     11,639     1976     2007   35 years

2982

 

Physicians Office Center

  St Louis   MO         1,445     13,825     32     1,445     13,857     15,302     384     21,120     2003     2011   35 years

2983

 

12700 Southford Road Medical Plaza

  St. Louis   MO         595     12,584     7     595     12,591     13,186     360     17,606     1993     2011   32 years

2984

 

St Anthony's MOB A

  St. Louis   MO         409     4,687     9     409     4,696     5,105     200     7,266     1975     2011   20 years

2985

 

St Anthony's MOB B

  St. Louis   MO         350     3,942         350     3,942     4,292     174     6,390     1980     2011   21 years

2988

 

Lemay Urgent Care Center

  St. Louis   MO         2,317     3,120         2,317     3,120     5,437     138     5,929     1983     2011   22 years

6813

 

Del E Webb Medical Plaza

  Henderson   NV         1,028     16,993     56     1,028     17,049     18,077     401     23,797     1999     2011   35 years

6819

 

The Terrace at South Meadows

  Reno   NV     7,590     504     9,966     381     504     10,347     10,851     219     16,621     2004     2011   35 years

2925

 

Anderson Medical Arts Building I

  Cincinnati   OH             9,632     1,108         10,740     10,740     1,813     8,927     1984     2007   35 years

2926

 

Anderson Medical Arts Building II

  Cincinnati   OH             15,123     2,118         17,241     17,241     2,549     14,692     2007     2007   35 years

3084

 

745 W State Street

  Columbus   OH     7,800     545     10,686     17     545     10,703     11,248     267     13,655     1999     2011   35 years

6950

 

Zanesville Surgery Center

  Zanesville   OH         172     9,403         172     9,403     9,575     164     10,455     2000     2011   35 years

6951

 

Dialysis Center

  Zanesville   OH         534     855         534     855     1,389     40     1,487     1960     2011   21 years

6952

 

Genesis Children's Center

  Zanesville   OH         538     3,781         538     3,781     4,319     91     4,745     2006     2011   30 years

6953

 

Medical Arts Building I

  Zanesville   OH         429     2,405         429     2,405     2,834     90     3,114     1970     2011   20 years

6954

 

Medical Arts Building II

  Zanesville   OH         485     6,013     147     485     6,160     6,645     201     7,798     1995     2011   25 years

6955

 

Medical Arts Building III

  Zanesville   OH         94     1,248         94     1,248     1,342     41     1,700     1970     2011   25 years

6956

 

Primecare Building

  Zanesville   OH         130     1,344         130     1,344     1,474     66     1,753     1978     2011   20 years

6957

 

Outpatient Rehabilitation Building

  Zanesville   OH         82     1,541         82     1,541     1,623     40     1,910     1985     2011   28 years

6958

 

Radiation Oncology Building

  Zanesville   OH         105     1,201         105     1,201     1,306     37     1,604     1988     2011   25 years

6959

 

Healthplex

  Zanesville   OH         2,488     15,849     11     2,488     15,860     18,348     401     19,431     1990     2011   32 years

6960

 

Physicians Pavilion

  Zanesville   OH         422     6,297     69     422     6,366     6,788     204     7,895     1990     2011   25 years

6961

 

Zanesville Northside Pharmacy

  Zanesville   OH         42     635         42     635     677     17     828     1985     2011   28 years

6962

 

Bethesda Campus MOB III

  Zanesville   OH         188     1,137         188     1,137     1,325     34     1,446     1978     2011   25 years

6814

 

Tuality 7th Avenue Medical Plaza

  Hillsboro   OR     20,286     1,516     24,638         1,516     24,638     26,154     507     31,851     2003     2011   35 years

3003

 

DCMH Medical Office Building

  Drexel Hill   PA             10,424     1,083         11,507     11,507     3,369     8,138     1984     2004   30 years

192


Table of Contents

 
   
   
   
   
   
   
   
   
   
   
   
   
   
   
  Life on
Which
Depreciation
in Income
Statement
is Computed
 
   
  Location    
  Initial Cost to Company    
  Gross Amount Carried at Close of Period    
   
   
   
   
 
   
   
  Costs
Capitalized
Subsequent
to Acquisition
   
   
   
   
   
Property #
  Property Name   City   State /
Province
  Encumbrances   Land and
Improvements
  Buildings and
Improvements
  Land and
Improvements
  Buildings and
Improvements
  Total   Accumulated
Depreciation
  NBV   Year of
Construction
  Year
Acquired

6350

 

Penn State University Outpatient Center

  Hershey   PA     57,415         55,439             55,439     55,439     2,923     59,700     2008     2010   35 years

6340

 

St. Joseph Medical Office Building

  Reading   PA             10,823     17         10,840     10,840     672     9,867     2006     2010   35 years

3002

 

Professional Office Building I

  Upland   PA             6,283     806         7,089     7,089     2,049     5,040     1978     2004   30 years

3070

 

St. Francis Millennium Medical Office Building

  Greenville   SC     17,673         13,062     10,038         23,100     23,100     2,465     20,635     2009     2009   35 years

3072

 

Irmo Professional MOB

  Irmo   SC     7,845     1,726     5,414         1,726     5,414     7,140     150     9,649     2004     2011   35 years

3085

 

Colleton Medical Arts

  Walterboro   SC         983     2,780         983     2,780     3,763     105     4,109     1998     2011   27 years

3086

 

Grandview MOB

  Jasper   TN         1,011     5,322         1,011     5,322     6,333     184     7,590     1998     2011   29.5 years

2901

 

Abilene Medical Commons I

  Abilene   TX         179     1,611         179     1,611     1,790     341     1,449     2000     2004   35 years

3074

 

East Houston MOB, LLC

  Houston   TX         356     2,877     203     356     3,080     3,436     138     3,837     1982     2011   15 years

3075

 

East Houston Medical Plaza

  Houston   TX         671     426     95     671     521     1,192     54     1,376     1982     2011   11 years

3077

 

Mansfield MOB

  Mansfield   TX         411     1,133     10     411     1,143     1,554     64     1,811     1998     2011   27 years

3060

 

Bayshore Surgery Center MOB

  Pasadena   TX     6,650     765     9,123     381     765     9,504     10,269     7,289     2,980     2001     2005   35 years

3061

 

Bayshore Rehabilitation Center MOB

  Pasadena   TX         95     1,128         95     1,128     1,223     223     1,000     1988     2005   35 years

6380

 

Seton Williamson Medical Plaza

  Round Rock   TX             15,074     269         15,343     15,343     1,109     14,125     2008     2010   35 years

6650

 

251 Medical Center

  Webster   TX         1,158     12,078         1,158     12,078     13,236     105     14,016     2006     2011   35 years

6651

 

253 Medical Center

  Webster   TX         1,181     11,862         1,181     11,862     13,043     98     14,154     2009     2011   35 years

3080

 

J. Hal Smith Building POB

  Christianburg   VA         175     432         175     432     607     17     701     1997     2011   26 years

3078

 

Brandersmill MOB

  Midlothian   VA         352     159         352     159     511     21     551     1985     2011   12.5 years

3079

 

Henrico MOB

  Richmond   VA         968     6,189         968     6,189     7,157     170     7,988     1976     2011   25 years

3040

 

Physician's Pavilion

  Vancouver   WA         1,411     32,939         1,411     32,939     34,350     700     41,206     2001     2011   35 years

3041

 

Administration Building

  Vancouver   WA         296     7,856         296     7,856     8,152     156     9,629     1972     2011   35 years

3042

 

Medical Center Physician's Building

  Vancouver   WA         1,225     31,246     35     1,225     31,281     32,506     638     36,907     1980     2011   35 years

3043

 

Memorial MOB

  Vancouver   WA         663     12,626     17     663     12,643     13,306     271     15,404     1999     2011   35 years

3044

 

Salmon Creek MOB

  Vancouver   WA         1,325     9,238         1,325     9,238     10,563     181     11,484     1994     2011   35 years

3045

 

Fisher's Landing MOB

  Vancouver   WA         1,590     5,420         1,590     5,420     7,010     128     7,841     1995     2011   34 years

3046

 

Healthy Steps Clinic

  Vancouver   WA         626     1,505         626     1,505     2,131     41     2,227     1997     2011   35 years

3047

 

Columbia Medical Plaza

  Vancouver   WA         281     5,266     43     281     5,309     5,590     116     7,033     1991     2011   35 years

6460

 

Appleton Heart Institute

  Appleton   WI             7,775             7,775     7,775     446     7,778     2003     2010   39 years

6461

 

Appleton Medical Offices West

  Appleton   WI             5,756             5,756     5,756     346     5,712     1989     2010   39 years

6462

 

Appleton Medical Offices South

  Appleton   WI             9,058     35         9,093     9,093     530     9,089     1983     2010   39 years

3030

 

Brookfield Clinic

  Brookfield   WI         2,638     4,093         2,638     4,093     6,731     100     7,365     1999     2011   35 years

3031

 

Hartland Clinic

  Hartland   WI         321     5,050         321     5,050     5,371     105     6,497     1994     2011   35 years

6463

 

Theda Clark Medical Center Office Pavilion

  Neenah   WI             7,080     46         7,126     7,126     396     7,020     1993     2010   39 years

6464

 

Aylward Medical Building Condo Floors 3 & 4

  Neenah   WI             4,462             4,462     4,462     209     4,664     2006     2010   39 years

3032

 

New Berlin Clinic

  New Berlin   WI         678     7,121         678     7,121     7,799     159     10,175     1999     2011   35 years

3036

 

WestWood Health & Fitness

  Pewaukee   WI         823     11,649         823     11,649     12,472     262     16,495     1997     2011   35 years

3033

 

Watertown Clinic

  Watertown   WI         166     3,234         166     3,234     3,400     65     4,023     2003     2011   35 years

3034

 

Southside Clinic

  Waukesha   WI         218     5,273         218     5,273     5,491     107     7,196     1997     2011   35 years

3035

 

Rehabilitation Hospital

  Waukesha   WI         372     15,636         372     15,636     16,008     278     19,743     2008     2011   35 years

3021

 

Casper WY MOB

  Casper   WY         3,015     26,513     99     3,017     26,610     29,627     3,165     26,462     2008     2008   35 years
                                                                 

 

TOTAL FOR MEDICAL OFFICE BUILDINGS

            531,702     146,775     1,814,291     65,336     146,883     1,879,519     2,026,402     108,138     2,234,767                
                                                                 

 

TOTAL FOR ALL PROPERTIES

          $ 2,905,840   $ 1,614,952   $ 15,267,106   $ 147,346   $ 1,614,847   $ 15,414,557   $ 17,029,404   $ 1,729,976   $ 15,913,732                
                                                                 

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ITEM 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

        Not applicable.

ITEM 9A.    Controls and Procedures

Evaluation of Disclosure Controls and Procedures

        As required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2011. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of December 31, 2011, at the reasonable assurance level.

Internal Control over Financial Reporting

        The information set forth under "Management Report on Internal Control over Financial Reporting" and "Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting" included in Part II, Item 8 of this Annual Report on Form 10-K is incorporated by reference into this Item 9A.

Internal Control Changes

        During the fourth quarter of 2011, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B.    Other Information

        Not applicable.


PART III

ITEM 10.    Directors, Executive Officers and Corporate Governance

        The information required by this Item 10 is incorporated by reference to the material under the headings "Proposals Requiring Your Vote—Proposal 1: Election of Directors," "Executive Officers," "Corporate Governance" and "Section 16(a) Beneficial Ownership Reporting Compliance" in our definitive Proxy Statement for the 2012 Annual Meeting of Stockholders, which we will file with the SEC not later than April 29, 2012.

ITEM 11.    Executive Compensation

        The information required by this Item 11 is incorporated by reference to the material under the headings "Corporate Governance—Non-Employee Director Compensation," "Executive Compensation" and "Corporate Governance—Board and Committee Membership—Executive Compensation Committee" in our definitive Proxy Statement for the 2012 Annual Meeting of Stockholders, which we will file with the SEC not later than April 29, 2012.

ITEM 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

        The information required by this Item 12 is incorporated by reference to the material under the headings "Equity Compensation Plan Information" and "Securities Ownership" in our definitive Proxy

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Statement for the 2012 Annual Meeting of Stockholders, which we will file with the SEC not later than April 29, 2012.

ITEM 13.    Certain Relationships and Related Transactions, and Director Independence

        The information required by this Item 13 is incorporated by reference to the material under the headings "Transactions with Related Persons" and "Corporate Governance" in our definitive Proxy Statement for the 2012 Annual Meeting of Stockholders, which we will file with the SEC not later than April 29, 2012.

ITEM 14.    Principal Accountant Fees and Services

        The information required by this Item 14 is incorporated by reference to the material under the headings "Proposals Requiring Your Vote—Proposal 2: Ratification of the Selection of Ernst & Young as Our Independent Registered Public Accounting Firm for Fiscal Year 2012—Audit and Non-Audit Fees" and "—Policy on Pre-Approval of Audit and Permissible Non-Audit Services" in our definitive Proxy Statement for the 2012 Annual Meeting of Stockholders, which we will file with the SEC not later than April 29, 2012.

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PART IV

ITEM 15.    Exhibits and Financial Statement Schedules

Financial Statements and Financial Statement Schedules

        The following documents have been included in Part II, Item 8 of this Annual Report on Form 10-K:

 
  Page  

Report of Independent Registered Public Accounting Firm

    94  

Consolidated Balance Sheets as of December 31, 2011 and 2010

    96  

Consolidated Statements of Income for the years ended December 31, 2011, 2010 and 2009

    97  

Consolidated Statements of Equity for the years ended December 31, 2011, 2010 and 2009

    98  

Consolidated Statements of Cash Flows for the years ended December 31, 2011, 2010 and 2009

    99  

Notes to Consolidated Financial Statements

    100  

Consolidated Financial Statement Schedule

       

Schedule III—Real Estate and Accumulated Depreciation

    166  

        All other schedules have been omitted because they are inapplicable, not required or the information is included elsewhere in the Consolidated Financial Statements or notes thereto.

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Exhibits

Exhibit
Number
  Description of Document   Location of Document
  2.1   Merger Agreement dated as of December 24, 2011 by and among Ventas, Inc., TH Merger Corp, Inc., TH Merger Sub, LLC, Cogdell Spencer Inc. and Cogdell Spencer LP.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on December 27, 2011.
 
       
  2.2   Merger Agreement dated as of February 27, 2011 by and among Ventas, Inc., Needles Acquisition LLC and Nationwide Health Properties, Inc.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on February 28, 2011.
 
       
  2.3.1   Merger Agreement dated as of October 21, 2010 by and among Ventas, Inc., Ventas SL I, LLC, Ventas SL II, LLC, Ventas SL III, LLC, Atria Holdings LLC, Lazard Senior Housing Partners LP, LSHP Coinvestment Partnership I LP, Atria Senior Living Group, Inc., One Lantern Senior Living Inc and LSHP Coinvestment I Inc.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on October 27, 2010.
 
       
  2.3.2   Amendment No. 1 to the Merger Agreement, dated as of May 12, 2011, by and among Ventas, Inc., Ventas SL I, LLC, Ventas SL II, LLC, Ventas SL III, LLC, Atria Holdings LLC, Lazard Senior Housing Partners LP, LSHP Coinvestment Partnership I LP, Atria Senior Living Group, Inc., One Lantern Senior Living Inc and LSHP Coinvestment I Inc.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on May 18, 2011.
 
       
  3.1   Amended and Restated Certificate of Incorporation, as amended, of Ventas, Inc.   Incorporated by reference to Exhibit 3.1 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2011.
 
       
  3.2   Fourth Amended and Restated Bylaws, as amended, of Ventas, Inc.   Incorporated by reference to Exhibit 3.2 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2011.
 
       
  4.1   Specimen common stock certificate.   Incorporated by reference to Exhibit 4.1 to our Annual Report on Form 10-K for the year ended December 31, 1998.
 
       
  4.2   Ventas, Inc. Distribution Reinvestment and Stock Purchase Plan.   Incorporated by reference to the Prospectus included in our Registration Statement on Form S-3, filed on November 25, 2011, File No. 333-178185.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  4.3   Certain instruments with respect to long-term debt of Ventas, Inc. and its consolidated subsidiaries are not filed herewith pursuant to Item 601(b)(4)(iii) of Regulation S-K, since the total amount of securities authorized under each such instrument does not exceed 10% of the total assets of Ventas, Inc. and its subsidiaries on a consolidated basis. Ventas, Inc. agrees to furnish a copy of any such instrument to the SEC upon request.    
 
       
  10.1.1   Second Amended and Restated Master Lease Agreement No. 1 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on May 3, 2007.
 
       
  10.1.2   Second Amended and Restated Master Lease Agreement No. 2 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on May 3, 2007.
 
       
  10.1.3   Second Amended and Restated Master Lease Agreement No. 3 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on May 3, 2007.
 
       
  10.1.4   Second Amended and Restated Master Lease Agreement No. 4 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K, filed on May 3, 2007.
 
       
  10.2.1   Form of Property Lease Agreement with respect to the Brookdale properties.   Incorporated by reference to Exhibit 10.13 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
 
       
  10.2.2   Form of Lease Guaranty with respect to the Brookdale properties.   Incorporated by reference to Exhibit 10.16 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.2.3   Schedule of Agreements Substantially Identical in All Material Respects to the agreements incorporated by reference as Exhibits 10.2.1 and 10.2.2 to this Annual Report on Form 10-K, pursuant to Instruction 2 to Item 601 of Regulation S-K.   Incorporated by reference to Exhibit 10.3 to our Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
 
       
  10.2.4.1   Agreement Regarding Leases dated as of October 19, 2004 by and between Brookdale Provident Properties LLC and PSLT-BLC Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.14 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
 
       
  10.2.4.2   Letter Agreement dated March 28, 2005 by and among Brookdale Provident Properties LLC, PSLT-BLC Properties Holdings, LLC and Ventas Provident, LLC (successor to Provident Senior Living Trust).   Incorporated by reference to Exhibit 10.19 to Amendment No. 4 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on April 11, 2005, File No. 333-120206.
 
       
  10.2.4.3   Letter Agreement dated April 4, 2008 by and between Brookdale Provident Properties LLC and PSLT-BLC Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.2.4.3 to our Annual Report on Form 10-K for the year ended December 31, 2009.
 
       
  10.2.4.4   First Amendment to Agreement Regarding Leases dated as of February 11, 2009 by and between PSLT-BLC Properties Holdings, LLC, Brookdale Provident Properties LLC, Brookdale Provident Management LLC and Ventas Provident, LLC.   Incorporated by reference to Exhibit 10.2.4.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.2.4.5   Second Amendment to Agreement Regarding Leases dated as of March 2, 2009 by and between PSLT-BLC Properties Holdings, LLC and Brookdale Provident Properties LLC, et al.   Incorporated by reference to Exhibit 10.2.4.5 to our Annual Report on Form 10-K for the year ended December 31, 2009.
 
       
  10.2.4.6   Third Amendment to Agreement Regarding Leases dated as of November 6, 2009 by and between PSLT-BLC Properties Holdings, LLC and Brookdale Provident Properties LLC, et al.   Incorporated by reference to Exhibit 10.2.4.6 to our Annual Report on Form 10-K for the year ended December 31, 2009.
 
       
  10.2.4.7   Guaranty of Agreement Regarding Leases dated as of October 19, 2004 by Brookdale Living Communities, Inc. in favor of PSLT-BLC Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.15 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.2.5   Guaranty dated as of February 11, 2009 by Brookdale Senior Living Inc., for the benefit of the landlords with respect to the Brookdale and Alterra properties, PSLT-BLC Properties Holdings, LLC and PSLT-ALS Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.2.9 to our Annual Report on Form 10-K for the year ended December 31, 2009.
 
       
  10.3   Letter Agreement dated as of January 14, 2007 between Ventas, Inc. and Sunrise Senior Living, Inc.   Incorporated by reference to Exhibit 10.4 to our Annual Report on Form 10-K for the year ended December 31, 2006.
 
       
  10.4   Loan Agreement dated May 17, 2011 by and between Ventas Realty, Limited Partnership and Nationwide Health Properties, LLC (as successor to Nationwide Health Properties, Inc.).   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on May 20, 2011.
 
       
  10.5.1   Term Loan Agreement dated as of June 3, 2011 among Nationwide Health Properties, LLC (as successor to Nationwide Health Properties, Inc.), the Lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.   Incorporated by reference to Exhibit 10.1 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on June 6, 2011.
 
       
  10.5.2   Guaranty Agreement dated as of July 1, 2011 among Ventas, Inc., as Guarantor, and JPMorgan Chase Bank, N.A., as Administrative Agent.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on July 11, 2011.
 
       
  10.6   Credit and Guaranty Agreement dated as of October 18, 2011 among Ventas Realty, Limited Partnership, Ventas SSL Ontario II, Inc. and Ventas SSL Ontario III, Inc., as Borrowers, Ventas, Inc., as Guarantor, the Lenders identified therein, and Bank of America, N.A., as Administrative Agent, Swing Line Lender, L/C Issuer and Alternative Currency Fronting Lender.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on October 24, 2011.
 
       
  10.7   Registration Rights Agreement dated as of December 1, 2006 by and among Ventas, Inc. and Banc of America Securities LLC, J.P. Morgan Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Initial Purchasers.   Incorporated by reference to Exhibit 4.2 to our Current Report on Form 8-K, filed on December 6, 2006.
 
       
  10.8   Registration Rights Agreement dated as of May 12, 2011 by and among Ventas, Inc., Prometheus Senior Quarters LLC, Lazard Senior Housing Partners LP and LSHP Coinvestment Partnership I LP.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on May 18, 2011.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.9   Lockup Agreement dated as of May 12, 2011 by and among Ventas, Inc., Prometheus Senior Quarters LLC, Lazard Senior Housing Partners LP and LSHP Coinvestment Partnership I LP.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on May 18, 2011.
 
       
  10.10   Ownership Limit Waiver Agreement dated as of May 12, 2011 by and among Ventas, Inc., Prometheus Senior Quarters LLC, Lazard Senior Housing Partners LP and LSHP Coinvestment Partnership I LP.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on May 18, 2011.
 
       
  10.11   Director Appointment Letter dated as of May 12, 2011 by Ventas, Inc.   Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K, filed on May 18, 2011.
 
       
  10.12 * Ventas, Inc. 2000 Incentive Compensation Plan, as amended.   Incorporated by reference to Exhibit 10.14.1 to our Annual Report on Form 10-K for the year ended December 31, 2004.
 
       
  10.13 * Ventas, Inc. 2004 Stock Plan for Directors, as amended.   Incorporated by reference to Exhibit 10.16.1 to our Annual Report on Form 10-K for the year ended December 31, 2004.
 
       
  10.14.1 * Ventas, Inc. 2006 Incentive Plan, as amended.   Incorporated by reference to Exhibit 10.10.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.14.2 * Form of Stock Option Agreement—2006 Incentive Plan.   Incorporated by reference to Exhibit 10.15.2 to our Annual Report on Form 10-K for the year ended December 31, 2006.
 
       
  10.14.3 * Form of Restricted Stock Agreement—2006 Incentive Plan.   Incorporated by reference to Exhibit 10.15.3 to our Annual Report on Form 10-K for the year ended December 31, 2006.
 
       
  10.15.1 * Ventas, Inc. 2006 Stock Plan for Directors, as amended.   Incorporated by reference to Exhibit 10.11.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.15.2 * Form of Stock Option Agreement—2006 Stock Plan for Directors.   Incorporated by reference to Exhibit 10.11.2 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.15.3 * Form of Restricted Stock Agreement—2006 Stock Plan for Directors.   Incorporated by reference to Exhibit 10.11.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.15.4 * Form of Restricted Stock Unit Agreement—2006 Stock Plan for Directors.   Incorporated by reference to Exhibit 10.11.4 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.16.1 * Ventas Executive Deferred Stock Compensation Plan, as amended.   Incorporated by reference to Exhibit 10.12.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.16.2 * Deferral Election Form under the Ventas Executive Deferred Stock Compensation Plan.   Incorporated by reference to Exhibit 10.12.2 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.17.1 * Ventas Nonemployee Directors' Deferred Stock Compensation Plan, as amended.   Incorporated by reference to Exhibit 10.13.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.17.2 * Deferral Election Form under the Ventas Nonemployee Directors' Deferred Stock Compensation Plan.   Incorporated by reference to Exhibit 10.13.2 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.18.1 * Nationwide Health Properties, Inc. 2005 Performance Incentive Plan.   Incorporated by reference to Appendix B to Nationwide Health Properties, Inc. definitive Proxy Statement for the 2005 Annual Meeting, filed on March 24, 2005.
 
       
  10.18.2 * First Amendment to the Nationwide Health Properties, Inc. 2005 Performance Incentive Plan, dated October 28, 2008.   Incorporated by reference to Exhibit 10.1 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on November 3, 2008.
 
       
  10.19.1 * Nationwide Health Properties, Inc. Retirement Plan for Directors, as amended and restated on April 20, 2006.   Incorporated by reference to Exhibit 10.1 to Nationwide Health Properties, Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006.
 
       
  10.19.2 * Amendment to the Nationwide Health Properties, Inc. Retirement Plan for Directors, as amended and restated on April 20, 2006.   Incorporated by reference to Exhibit 10.9 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on November 3, 2008.
 
       
  10.20 * Amended and Restated Deferred Compensation Plan of Nationwide Health Properties, Inc. dated October 28, 2008.   Incorporated by reference to Exhibit 10.6 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on November 3, 2008.
 
       
  10.21 * Second Amended and Restated Employment Agreement dated as of March 22, 2011 between Ventas, Inc. and Debra A. Cafaro.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on March 24, 2011.
 
       
  10.22.1 * Employment Agreement dated as of July 31, 1998 between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.15.2.1 to our Annual Report on Form 10-K for the year ended December 31, 2002.
 
       
  10.22.2 * Amendment dated as of September 30, 1999 to Employment Agreement between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.15.2.2 to our Annual Report on Form 10-K for the year ended December 31, 2002.
 
       
  10.22.3 * Amendment dated as of March 19, 2007 to Employment Agreement between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on March 23, 2007.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.22.4 * Amendment dated as of December 31, 2008 to Employment Agreement between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.15.4 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.22.5 * Amended and Restated Change-in-Control Severance Agreement dated as of March 22, 2011 between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on March 24, 2011.
 
       
  10.23.1 * Amended and Restated Employment Agreement dated as of December 31, 2004 between Ventas, Inc. and Richard A. Schweinhart.   Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K filed on January 6, 2005.
 
       
  10.23.2 * Amendment dated as of March 19, 2007 to Amended and Restated Employment Agreement between Ventas, Inc. and Richard A. Schweinhart.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on March 23, 2007.
 
       
  10.23.3 * Amendment dated as of December 31, 2008 to Amended and Restated Employment Agreement between Ventas, Inc. and Richard A. Schweinhart.   Incorporated by reference to Exhibit 10.16.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.24.1 * Employment Agreement dated as of September 18, 2002 between Ventas, Inc. and Raymond J. Lewis.   Incorporated by reference to Exhibit 10.3 to our Quarterly Report on Form 10-Q for the quarter ended September 30, 2002.
 
       
  10.24.2 * Amendment dated as of March 19, 2007 to Employment Agreement between Ventas, Inc. and Raymond J. Lewis.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on March 23, 2007.
 
       
  10.24.3 * Amendment dated as of December 31, 2008 to Employment Agreement between Ventas, Inc. and Raymond J. Lewis.   Incorporated by reference to Exhibit 10.17.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.25 * Employment Agreement dated as of June 22, 2010 between Ventas, Inc. and Todd W. Lillibridge.   Incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2010.
 
       
  10.26 * Letter Agreement dated as of June 30, 2011 between Ventas, Inc. and Douglas M. Pasquale.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on July 11, 2011.
 
       
  10.27 * Ventas Employee and Director Stock Purchase Plan, as amended.   Incorporated by reference to Exhibit 10.18 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       
  10.28   First Amended and Restated Agreement of Limited Partnership of Ventas Realty, Limited Partnership.   Incorporated by reference to Exhibit 3.5 to our Registration Statement on Form S-4, as amended, File No. 333-89312.
 
       
  12   Statement Regarding Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Stock Dividends.   Filed herewith.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  21   Subsidiaries of Ventas, Inc.   Filed herewith.
 
       
  23   Consent of Ernst & Young LLP.   Filed herewith.
 
       
  31.1   Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(a) under the Exchange Act.   Filed herewith.
 
       
  31.2   Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) under the Exchange Act.   Filed herewith.
 
       
  32.1   Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. 1350.   Filed herewith.
 
       
  32.2   Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. 1350.   Filed herewith.
 
       
  101   Interactive Data File.   Filed herewith.

*
Management contract or compensatory plan or arrangement required to be filed as an exhibit pursuant to Item 15(c) of Form 10-K.

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SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: February 22, 2012

  VENTAS, INC.

 

By:

 

/s/ DEBRA A. CAFARO


Debra A. Cafaro
Chairman and Chief Executive Officer

        Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature
 
Title
 
Date

 

 

 

 

 
/s/ DEBRA A. CAFARO

Debra A. Cafaro
  Chairman and Chief Executive Officer (Principal Executive Officer)   February 22, 2012

/s/ RICHARD A. SCHWEINHART

Richard A. Schweinhart

 

Executive Vice President and Chief Financial Officer (Principal Financial Officer)

 

February 22, 2012

/s/ ROBERT J. BREHL

Robert J. Brehl

 

Chief Accounting Officer and Controller (Principal Accounting Officer)

 

February 22, 2012

/s/ DOUGLAS CROCKER II

Douglas Crocker II

 

Director

 

February 22, 2012

/s/ RONALD G. GEARY

Ronald G. Geary

 

Director

 

February 22, 2012

/s/ JAY M. GELLERT

Jay M. Gellert

 

Director

 

February 22, 2012

/s/ RICHARD I. GILCHRIST

Richard I. Gilchrist

 

Director

 

February 22, 2012

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Table of Contents

Signature
 
Title
 
Date

 

 

 

 

 
/s/ MATTHEW J. LUSTIG

Matthew J. Lustig
  Director   February 22, 2012

/s/ DOUGLAS M. PASQUALE

Douglas M. Pasquale

 

Director

 

February 22, 2012

/s/ ROBERT D. PAULSON

Robert D. Paulson

 

Director

 

February 22, 2012

/s/ ROBERT D. REED

Robert D. Reed

 

Director

 

February 22, 2012

/s/ SHELI Z. ROSENBERG

Sheli Z. Rosenberg

 

Director

 

February 22, 2012

/s/ GLENN J. RUFRANO

Glenn J. Rufrano

 

Director

 

February 22, 2012

/s/ JAMES D. SHELTON

James D. Shelton

 

Director

 

February 22, 2012

/s/ THOMAS C. THEOBALD

Thomas C. Theobald

 

Director

 

February 22, 2012

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EXHIBIT INDEX

Exhibit
Number
  Description of Document   Location of Document
  2.1   Merger Agreement dated as of December 24, 2011 by and among Ventas, Inc., TH Merger Corp, Inc., TH Merger Sub, LLC, Cogdell Spencer Inc. and Cogdell Spencer LP.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on December 27, 2011.
            
  2.2   Merger Agreement dated as of February 27, 2011 by and among Ventas, Inc., Needles Acquisition LLC and Nationwide Health Properties, Inc.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on February 28, 2011.
            
  2.3.1   Merger Agreement dated as of October 21, 2010 by and among Ventas, Inc., Ventas SL I, LLC, Ventas SL II, LLC, Ventas SL III, LLC, Atria Holdings LLC, Lazard Senior Housing Partners LP, LSHP Coinvestment Partnership I LP, Atria Senior Living Group, Inc., One Lantern Senior Living Inc and LSHP Coinvestment I Inc.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on October 27, 2010.
            
  2.3.2   Amendment No. 1 to the Merger Agreement, dated as of May 12, 2011, by and among Ventas, Inc., Ventas SL I, LLC, Ventas SL II, LLC, Ventas SL III, LLC, Atria Holdings LLC, Lazard Senior Housing Partners LP, LSHP Coinvestment Partnership I LP, Atria Senior Living Group, Inc., One Lantern Senior Living Inc and LSHP Coinvestment I Inc.   Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, filed on May 18, 2011.
            
  3.1   Amended and Restated Certificate of Incorporation, as amended, of Ventas, Inc.   Incorporated by reference to Exhibit 3.1 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2011.
            
  3.2   Fourth Amended and Restated Bylaws, as amended, of Ventas, Inc.   Incorporated by reference to Exhibit 3.2 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2011.
            
  4.1   Specimen common stock certificate.   Incorporated by reference to Exhibit 4.1 to our Annual Report on Form 10-K for the year ended December 31, 1998.
            
  4.2   Ventas, Inc. Distribution Reinvestment and Stock Purchase Plan.   Incorporated by reference to the Prospectus included in our Registration Statement on Form S-3, filed on November 25, 2011, File No. 333-178185.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  4.3   Certain instruments with respect to long-term debt of Ventas, Inc. and its consolidated subsidiaries are not filed herewith pursuant to Item 601(b)(4)(iii) of Regulation S-K, since the total amount of securities authorized under each such instrument does not exceed 10% of the total assets of Ventas, Inc. and its subsidiaries on a consolidated basis. Ventas, Inc. agrees to furnish a copy of any such instrument to the SEC upon request.    
            
  10.1.1   Second Amended and Restated Master Lease Agreement No. 1 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on May 3, 2007.
            
  10.1.2   Second Amended and Restated Master Lease Agreement No. 2 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on May 3, 2007.
            
  10.1.3   Second Amended and Restated Master Lease Agreement No. 3 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on May 3, 2007.
            
  10.1.4   Second Amended and Restated Master Lease Agreement No. 4 dated as of April 27, 2007 for lease executed by Ventas Realty, Limited Partnership, as Lessor, and Kindred Healthcare, Inc. and Kindred Healthcare Operating, Inc., as Tenant.   Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K, filed on May 3, 2007.
            
  10.2.1   Form of Property Lease Agreement with respect to the Brookdale properties.   Incorporated by reference to Exhibit 10.13 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
            
  10.2.2   Form of Lease Guaranty with respect to the Brookdale properties.   Incorporated by reference to Exhibit 10.16 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.2.3   Schedule of Agreements Substantially Identical in All Material Respects to the agreements incorporated by reference as Exhibits 10.2.1 and 10.2.2 to this Annual Report on Form 10-K, pursuant to Instruction 2 to Item 601 of Regulation S-K.   Incorporated by reference to Exhibit 10.3 to our Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
            
  10.2.4.1   Agreement Regarding Leases dated as of October 19, 2004 by and between Brookdale Provident Properties LLC and PSLT-BLC Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.14 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
            
  10.2.4.2   Letter Agreement dated March 28, 2005 by and among Brookdale Provident Properties LLC, PSLT-BLC Properties Holdings, LLC and Ventas Provident, LLC (successor to Provident Senior Living Trust).   Incorporated by reference to Exhibit 10.19 to Amendment No. 4 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on April 11, 2005, File No. 333-120206.
            
  10.2.4.3   Letter Agreement dated April 4, 2008 by and between Brookdale Provident Properties LLC and PSLT-BLC Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.2.4.3 to our Annual Report on Form 10-K for the year ended December 31, 2009.
            
  10.2.4.4   First Amendment to Agreement Regarding Leases dated as of February 11, 2009 by and between PSLT-BLC Properties Holdings, LLC, Brookdale Provident Properties LLC, Brookdale Provident Management LLC and Ventas Provident, LLC.   Incorporated by reference to Exhibit 10.2.4.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.2.4.5   Second Amendment to Agreement Regarding Leases dated as of March 2, 2009 by and between PSLT-BLC Properties Holdings, LLC and Brookdale Provident Properties LLC, et al.   Incorporated by reference to Exhibit 10.2.4.5 to our Annual Report on Form 10-K for the year ended December 31, 2009.
            
  10.2.4.6   Third Amendment to Agreement Regarding Leases dated as of November 6, 2009 by and between PSLT-BLC Properties Holdings, LLC and Brookdale Provident Properties LLC, et al.   Incorporated by reference to Exhibit 10.2.4.6 to our Annual Report on Form 10-K for the year ended December 31, 2009.
            
  10.2.4.7   Guaranty of Agreement Regarding Leases dated as of October 19, 2004 by Brookdale Living Communities, Inc. in favor of PSLT-BLC Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.15 to Amendment No. 2 to Provident Senior Living Trust's Registration Statement on Form S-11, filed on January 18, 2005, File No. 333-120206.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.2.5   Guaranty dated as of February 11, 2009 by Brookdale Senior Living Inc., for the benefit of the landlords with respect to the Brookdale and Alterra properties, PSLT-BLC Properties Holdings, LLC and PSLT-ALS Properties Holdings, LLC.   Incorporated by reference to Exhibit 10.2.9 to our Annual Report on Form 10-K for the year ended December 31, 2009.
            
  10.3   Letter Agreement dated as of January 14, 2007 between Ventas, Inc. and Sunrise Senior Living, Inc.   Incorporated by reference to Exhibit 10.4 to our Annual Report on Form 10-K for the year ended December 31, 2006.
            
  10.4   Loan Agreement dated May 17, 2011 by and between Ventas Realty, Limited Partnership and Nationwide Health Properties, LLC (as successor to Nationwide Health Properties, Inc.).   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on May 20, 2011.
            
  10.5.1   Term Loan Agreement dated as of June 3, 2011 among Nationwide Health Properties, LLC (as successor to Nationwide Health Properties, Inc.), the Lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.   Incorporated by reference to Exhibit 10.1 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on June 6, 2011.
            
  10.5.2   Guaranty Agreement dated as of July 1, 2011 among Ventas, Inc., as Guarantor, and JPMorgan Chase Bank, N.A., as Administrative Agent.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on July 11, 2011.
            
  10.6   Credit and Guaranty Agreement dated as of October 18, 2011 among Ventas Realty, Limited Partnership, Ventas SSL Ontario II, Inc. and Ventas SSL Ontario III, Inc., as Borrowers, Ventas, Inc., as Guarantor, the Lenders identified therein, and Bank of America, N.A., as Administrative Agent, Swing Line Lender, L/C Issuer and Alternative Currency Fronting Lender.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on October 24, 2011.
            
  10.7   Registration Rights Agreement dated as of December 1, 2006 by and among Ventas, Inc. and Banc of America Securities LLC, J.P. Morgan Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Initial Purchasers.   Incorporated by reference to Exhibit 4.2 to our Current Report on Form 8-K, filed on December 6, 2006.
            
  10.8   Registration Rights Agreement dated as of May 12, 2011 by and among Ventas, Inc., Prometheus Senior Quarters LLC, Lazard Senior Housing Partners LP and LSHP Coinvestment Partnership I LP.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on May 18, 2011.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.9   Lockup Agreement dated as of May 12, 2011 by and among Ventas, Inc., Prometheus Senior Quarters LLC, Lazard Senior Housing Partners LP and LSHP Coinvestment Partnership I LP.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on May 18, 2011.
            
  10.10   Ownership Limit Waiver Agreement dated as of May 12, 2011 by and among Ventas, Inc., Prometheus Senior Quarters LLC, Lazard Senior Housing Partners LP and LSHP Coinvestment Partnership I LP.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on May 18, 2011.
            
  10.11   Director Appointment Letter dated as of May 12, 2011 by Ventas, Inc.   Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K, filed on May 18, 2011.
            
  10.12 * Ventas, Inc. 2000 Incentive Compensation Plan, as amended.   Incorporated by reference to Exhibit 10.14.1 to our Annual Report on Form 10-K for the year ended December 31, 2004.
            
  10.13 * Ventas, Inc. 2004 Stock Plan for Directors, as amended.   Incorporated by reference to Exhibit 10.16.1 to our Annual Report on Form 10-K for the year ended December 31, 2004.
            
  10.14.1 * Ventas, Inc. 2006 Incentive Plan, as amended.   Incorporated by reference to Exhibit 10.10.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.14.2 * Form of Stock Option Agreement—2006 Incentive Plan.   Incorporated by reference to Exhibit 10.15.2 to our Annual Report on Form 10-K for the year ended December 31, 2006.
            
  10.14.3 * Form of Restricted Stock Agreement—2006 Incentive Plan.   Incorporated by reference to Exhibit 10.15.3 to our Annual Report on Form 10-K for the year ended December 31, 2006.
            
  10.15.1 * Ventas, Inc. 2006 Stock Plan for Directors, as amended.   Incorporated by reference to Exhibit 10.11.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.15.2 * Form of Stock Option Agreement—2006 Stock Plan for Directors.   Incorporated by reference to Exhibit 10.11.2 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.15.3 * Form of Restricted Stock Agreement—2006 Stock Plan for Directors.   Incorporated by reference to Exhibit 10.11.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.15.4 * Form of Restricted Stock Unit Agreement—2006 Stock Plan for Directors.   Incorporated by reference to Exhibit 10.11.4 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.16.1 * Ventas Executive Deferred Stock Compensation Plan, as amended.   Incorporated by reference to Exhibit 10.12.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.16.2 * Deferral Election Form under the Ventas Executive Deferred Stock Compensation Plan.   Incorporated by reference to Exhibit 10.12.2 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.17.1 * Ventas Nonemployee Directors' Deferred Stock Compensation Plan, as amended.   Incorporated by reference to Exhibit 10.13.1 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.17.2 * Deferral Election Form under the Ventas Nonemployee Directors' Deferred Stock Compensation Plan.   Incorporated by reference to Exhibit 10.13.2 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.18.1 * Nationwide Health Properties, Inc. 2005 Performance Incentive Plan.   Incorporated by reference to Appendix B to Nationwide Health Properties, Inc. definitive Proxy Statement for the 2005 Annual Meeting, filed on March 24, 2005.
            
  10.18.2 * First Amendment to the Nationwide Health Properties, Inc. 2005 Performance Incentive Plan, dated October 28, 2008.   Incorporated by reference to Exhibit 10.1 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on November 3, 2008.
            
  10.19.1 * Nationwide Health Properties, Inc. Retirement Plan for Directors, as amended and restated on April 20, 2006.   Incorporated by reference to Exhibit 10.1 to Nationwide Health Properties, Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006.
            
  10.19.2 * Amendment to the Nationwide Health Properties, Inc. Retirement Plan for Directors, as amended and restated on April 20, 2006.   Incorporated by reference to Exhibit 10.9 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on November 3, 2008.
            
  10.20 * Amended and Restated Deferred Compensation Plan of Nationwide Health Properties, Inc. dated October 28, 2008.   Incorporated by reference to Exhibit 10.6 to Nationwide Health Properties, Inc.'s Current Report on Form 8-K, filed on November 3, 2008.
            
  10.21 * Second Amended and Restated Employment Agreement dated as of March 22, 2011 between Ventas, Inc. and Debra A. Cafaro.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on March 24, 2011.
            
  10.22.1 * Employment Agreement dated as of July 31, 1998 between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.15.2.1 to our Annual Report on Form 10-K for the year ended December 31, 2002.
            
  10.22.2 * Amendment dated as of September 30, 1999 to Employment Agreement between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.15.2.2 to our Annual Report on Form 10-K for the year ended December 31, 2002.
            
  10.22.3 * Amendment dated as of March 19, 2007 to Employment Agreement between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, filed on March 23, 2007.
 
       

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Exhibit
Number
  Description of Document   Location of Document
  10.22.4 * Amendment dated as of December 31, 2008 to Employment Agreement between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.15.4 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.22.5 * Amended and Restated Change-in-Control Severance Agreement dated as of March 22, 2011 between Ventas, Inc. and T. Richard Riney.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on March 24, 2011.
            
  10.23.1 * Amended and Restated Employment Agreement dated as of December 31, 2004 between Ventas, Inc. and Richard A. Schweinhart.   Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K filed on January 6, 2005.
            
  10.23.2 * Amendment dated as of March 19, 2007 to Amended and Restated Employment Agreement between Ventas, Inc. and Richard A. Schweinhart.   Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, filed on March 23, 2007.
            
  10.23.3 * Amendment dated as of December 31, 2008 to Amended and Restated Employment Agreement between Ventas, Inc. and Richard A. Schweinhart.   Incorporated by reference to Exhibit 10.16.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.24.1 * Employment Agreement dated as of September 18, 2002 between Ventas, Inc. and Raymond J. Lewis.   Incorporated by reference to Exhibit 10.3 to our Quarterly Report on Form 10-Q for the quarter ended September 30, 2002.
            
  10.24.2 * Amendment dated as of March 19, 2007 to Employment Agreement between Ventas, Inc. and Raymond J. Lewis.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on March 23, 2007.
            
  10.24.3 * Amendment dated as of December 31, 2008 to Employment Agreement between Ventas, Inc. and Raymond J. Lewis.   Incorporated by reference to Exhibit 10.17.3 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.25 * Employment Agreement dated as of June 22, 2010 between Ventas, Inc. and Todd W. Lillibridge.   Incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 2010.
            
  10.26 * Letter Agreement dated as of June 30, 2011 between Ventas, Inc. and Douglas M. Pasquale.   Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, filed on July 11, 2011.
            
  10.27 * Ventas Employee and Director Stock Purchase Plan, as amended.   Incorporated by reference to Exhibit 10.18 to our Annual Report on Form 10-K for the year ended December 31, 2008.
            
  10.28   First Amended and Restated Agreement of Limited Partnership of Ventas Realty, Limited Partnership.   Incorporated by reference to Exhibit 3.5 to our Registration Statement on Form S-4, as amended, File No. 333-89312.
            
  12   Statement Regarding Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Stock Dividends.   Filed herewith.
 
       

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Table of Contents

Exhibit
Number
  Description of Document   Location of Document
  21   Subsidiaries of Ventas, Inc.   Filed herewith.
            
  23   Consent of Ernst & Young LLP.   Filed herewith.
            
  31.1   Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(a) under the Exchange Act.   Filed herewith.
            
  31.2   Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a) under the Exchange Act.   Filed herewith.
            
  32.1   Certification of Debra A. Cafaro, Chairman and Chief Executive Officer, pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. 1350.   Filed herewith.
            
  32.2   Certification of Richard A. Schweinhart, Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. 1350.   Filed herewith.
            
  101   Interactive Data File.   Filed herewith.

*
Management contract or compensatory plan or arrangement required to be filed as an exhibit pursuant to Item 15(c) of Form 10-K.

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