Profile: HCP Inc (HCP.N)
HCP, Inc. (HCP), incorporated on March 21, 1985, is a real estate investment trust (REIT). The Company invests primarily in real estate serving the healthcare industry in the United States. HCP acquires, develops, leases, manages and disposes of healthcare real estate and provides financing to healthcare providers. The Company’s portfolio consists of investments in the five healthcare segments: senior housing, life science, medical office, post-acute/skilled nursing and hospital. The Company makes investments within its healthcare segments using the five investment products: properties under lease, debt investments, developments and redevelopments, investment management and RIDEA, which represents investments in senior housing operations. On January 14, 2011, HCP acquired its partner's 65% interest in a joint venture that owned 25 senior housing facilities, becoming the owner of the portfolio. On April 17, 2011, the Company acquired 268 post-acute/skilled nursing facilities and 66 assisted living facilities located in 30 states of HCR ManorCare, Inc. On September 1, 2011, the Company completed a venture with Brookdale Senior Living, Inc. (Brookdale) that included 37 HCP-owned senior living communities previously leased to or operated by Horizon Bay Retirement Living (Horizon Bay). As part of this transaction, Brookdale acquired Horizon Bay. During the year ended December 31, 2011, the Company sold three senior housing facilities. In October 2012, Emeritus Corp announced that HCP closed the acquisition of 127 of the 133 senior housing communities.
As of December 31, 2011, HCP had interests in 314 senior housing facilities, 21 of which are in a RIDEA structure. Senior housing facilities include assisted living facilities (ALFs), independent living facilities (ILFs) and continuing care retirement communities (CCRCs). ALFs are licensed care facilities that provide personal care services, support and housing for those who need help with activities of daily living (ADL) yet require limited medical care. As of December 31, 2011, the Company had interests in 258 ALFs. ILFs are designed to meet the needs of seniors who choose to live in an environment surrounded by their peers with services, such as housekeeping, meals and activities. As of December 31, 2011, it had interests in 44 ILFs. CCRCs provide housing and health-related services under long-term contracts. As of December 31, 2011, HCP had interests in 12 CCRCs. The Company’s senior housing segment accounted for approximately 31% of the Company’s total revenue during 2011.
As of December 31, 2011, HCP had interests in 313 post-acute/skilled nursing facilities (SNFs). Post-acute/skilled nursing services provided by the Company’s operators and tenants in these facilities are primarily paid for either by private sources or through the Medicare and Medicaid programs. All of its SNFs are leased to single tenants under triple-net lease structures. The Company’s post-acute/skilled nursing segment accounted for approximately 29% of the total revenue during 2011.
As of December 31, 2011, the Company had interests in 108 life science properties, including four facilities owned by its Investment Management Platform. These properties contain laboratory and office space primarily for biotechnology and pharmaceutical companies, scientific research institutions, government agencies and other organizations involved in the life science industry. The Company’s properties are located in, including San Francisco, San Diego and Salt Lake City. As of December 31, 2011, 97% of its life science leases (based on leased square feet) were under triple-net structures. Its life science segment accounted for approximately 17% of the Company’s total revenue during 2011.
As of December 31, 2011, HCP had interests in 254 medical office buildings (MOBs), including 66 facilities-owned by its Investment Management Platform. These facilities typically contain physicians' offices and examination rooms, and may also include pharmacies, hospital ancillary service space and outpatient services, such as diagnostic centers, rehabilitation clinics and day-surgery operating rooms. Its MOBs are typically multi-tenant properties leased to healthcare providers (hospitals and physician practices), with approximately 83% of the Company’s MOBs, based on square feet, located on hospital campuses. At December 31, 2011, 48% of its medical office leases (based on leased square feet) were under triple-net structures. Its medical office segment accounted for approximately 19% of the total revenue during 2011. During 2011, HCA, Inc. (HCA), as its tenant, contributed 13% of the Company’s medical office segment revenues. Its Investment Management Platform represents the following unconsolidated joint ventures: HCP Ventures III, LLC, HCP Ventures IV, LLC, and the HCP Life Science ventures.
As of December 31, 2011, the Company had interests in 21 hospitals, including four facilities owned by its Investment Management Platform. Services provided by its operators and tenants in these facilities are paid for by private sources, third-party payers (insurance and Health Maintenance Organizations (HMOs)), or through the Medicare and Medicaid programs. Its hospital property types include acute care, long-term acute care, specialty and rehabilitation hospitals. HCP’s hospitals are all leased to single tenants or operators under triple-net lease structures. The Company’s hospital segment accounted for approximately 5% of the total revenue during 2011.
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