|
(Mark One)
|
|
|
x
|
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2019
|
OR
|
||
¨
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO
|
|
|
Maryland
(State or Other Jurisdiction of Incorporation or Organization)
|
|
46-5212033
(I.R.S. Employer Identification No.)
|
|
Title of each Class
|
Trading Symbol
|
Name of each exchange on which registered
|
|
|
Common stock, $0.01 par value per share
|
CHCT
|
New York Stock Exchange
|
|
Large accelerated
filer ¨
|
Accelerated filer x
|
Emerging-growth company x
|
Non-accelerated filer ¨
|
Smaller reporting
company x
|
|
|
Page
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
|
|
|
(Unaudited)
|
|
|
||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
ASSETS
|
|
|
|
||||
Real estate properties
|
|
|
|
||||
Land and land improvements
|
$
|
63,015
|
|
|
$
|
50,270
|
|
Buildings, improvements, and lease intangibles
|
503,110
|
|
|
394,527
|
|
||
Personal property
|
202
|
|
|
133
|
|
||
Total real estate properties
|
566,327
|
|
|
444,930
|
|
||
Less accumulated depreciation
|
(71,617
|
)
|
|
(55,298
|
)
|
||
Total real estate properties, net
|
494,710
|
|
|
389,632
|
|
||
Cash and cash equivalents
|
1,724
|
|
|
2,007
|
|
||
Restricted cash
|
224
|
|
|
385
|
|
||
Other assets, net
|
36,414
|
|
|
34,546
|
|
||
Total assets
|
$
|
533,072
|
|
|
$
|
426,570
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
Liabilities
|
|
|
|
||||
Debt, net
|
$
|
215,460
|
|
|
$
|
147,766
|
|
Accounts payable and accrued liabilities
|
4,004
|
|
|
3,196
|
|
||
Other liabilities
|
12,661
|
|
|
3,949
|
|
||
Total liabilities
|
232,125
|
|
|
154,911
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders' Equity
|
|
|
|
||||
Preferred stock, $0.01 par value; 50,000,000 shares authorized; none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value; 450,000,000 shares authorized; 20,177,693 and 18,634,502 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively
|
202
|
|
|
186
|
|
||
Additional paid-in capital
|
391,247
|
|
|
337,180
|
|
||
Cumulative net income
|
15,341
|
|
|
9,178
|
|
||
Accumulated other comprehensive (loss) income
|
(6,826
|
)
|
|
633
|
|
||
Cumulative dividends
|
(99,017
|
)
|
|
(75,518
|
)
|
||
Total stockholders’ equity
|
300,947
|
|
|
271,659
|
|
||
Total liabilities and stockholders' equity
|
$
|
533,072
|
|
|
$
|
426,570
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
REVENUES
|
|
|
|
|
|
|
|
||||||||
Rental income
|
$
|
15,718
|
|
|
$
|
11,858
|
|
|
$
|
41,977
|
|
|
$
|
34,743
|
|
Other operating interest
|
541
|
|
|
679
|
|
|
2,039
|
|
|
1,625
|
|
||||
|
16,259
|
|
|
12,537
|
|
|
44,016
|
|
|
36,368
|
|
||||
|
|
|
|
|
|
|
|
||||||||
EXPENSES
|
|
|
|
|
|
|
|
||||||||
Property operating
|
3,327
|
|
|
2,627
|
|
|
9,395
|
|
|
7,497
|
|
||||
General and administrative
|
2,041
|
|
|
1,395
|
|
|
5,602
|
|
|
4,092
|
|
||||
Depreciation and amortization
|
5,774
|
|
|
4,925
|
|
|
16,319
|
|
|
14,471
|
|
||||
|
11,142
|
|
|
8,947
|
|
|
31,316
|
|
|
26,060
|
|
||||
|
|
|
|
|
|
|
|
||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND OTHER ITEMS
|
5,117
|
|
|
3,590
|
|
|
12,700
|
|
|
10,308
|
|
||||
Interest expense
|
(2,483
|
)
|
|
(1,643
|
)
|
|
(6,788
|
)
|
|
(4,482
|
)
|
||||
Interest and other income, net
|
13
|
|
|
52
|
|
|
251
|
|
|
462
|
|
||||
INCOME FROM CONTINUING OPERATIONS
|
2,647
|
|
|
1,999
|
|
|
6,163
|
|
|
6,288
|
|
||||
NET INCOME
|
$
|
2,647
|
|
|
$
|
1,999
|
|
|
$
|
6,163
|
|
|
$
|
6,288
|
|
|
|
|
|
|
|
|
|
||||||||
NET INCOME PER COMMON SHARE:
|
|
|
|
|
|
|
|
||||||||
Net income per common share – Basic
|
$
|
0.12
|
|
|
$
|
0.10
|
|
|
$
|
0.28
|
|
|
$
|
0.31
|
|
Net income per common share – Diluted
|
$
|
0.12
|
|
|
$
|
0.10
|
|
|
$
|
0.28
|
|
|
$
|
0.31
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-BASIC
|
18,832,902
|
|
|
17,669,681
|
|
|
18,347,630
|
|
|
17,695,688
|
|
||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-DILUTED
|
18,832,902
|
|
|
17,669,681
|
|
|
18,347,630
|
|
|
17,695,688
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
NET INCOME
|
$
|
2,647
|
|
|
$
|
1,999
|
|
|
$
|
6,163
|
|
|
$
|
6,288
|
|
||
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|||||||||
|
|
(Decrease) increase in fair value of cash flow hedges
|
(2,060
|
)
|
|
527
|
|
|
(7,305
|
)
|
|
2,152
|
|
||||
|
|
Reclassification for amounts recognized as interest expense
|
3
|
|
|
46
|
|
|
(154
|
)
|
|
201
|
|
||||
|
Total other comprehensive (loss) income
|
(2,057
|
)
|
|
573
|
|
|
(7,459
|
)
|
|
2,353
|
|
|||||
COMPREHENSIVE INCOME (LOSS)
|
$
|
590
|
|
|
$
|
2,572
|
|
|
$
|
(1,296
|
)
|
|
$
|
8,641
|
|
|
Preferred Stock
|
|
Common Stock
|
|
Additional Paid in Capital
|
|
Cumulative Net
Income
|
|
Accumulated Other Comprehensive (Loss) Income
|
|
Cumulative Dividends
|
|
Total Stockholders' Equity
|
||||||||||||||||||
|
Shares
|
Amount
|
|
Shares
|
Amount
|
|
|||||||||||||||||||||||||
Balance at June 30, 2019
|
—
|
|
$
|
—
|
|
|
19,401,244
|
|
$
|
194
|
|
|
$
|
361,913
|
|
|
$
|
12,694
|
|
|
$
|
(4,769
|
)
|
|
$
|
(90,912
|
)
|
|
$
|
279,120
|
|
Issuance of common stock, net of issuance costs
|
—
|
|
—
|
|
|
680,309
|
|
$
|
7
|
|
|
$
|
28,333
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28,340
|
|
|
Stock-based compensation
|
—
|
|
—
|
|
|
96,140
|
|
1
|
|
|
1,001
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,002
|
|
|||||||
Unrecognized gain on cash flow hedges
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,060
|
)
|
|
—
|
|
|
(2,060
|
)
|
|||||||
Reclassification adj for losses included in net income (interest expense)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|||||||
Net income
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
2,647
|
|
|
—
|
|
|
—
|
|
|
2,647
|
|
|||||||
Dividends to common stockholders ($0.4125 per share)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,105
|
)
|
|
(8,105
|
)
|
|||||||
Balance at September 30, 2019
|
—
|
|
$
|
—
|
|
|
20,177,693
|
|
$
|
202
|
|
|
$
|
391,247
|
|
|
$
|
15,341
|
|
|
$
|
(6,826
|
)
|
|
$
|
(99,017
|
)
|
|
$
|
300,947
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at December 31, 2018
|
—
|
|
$
|
—
|
|
|
18,634,502
|
|
$
|
186
|
|
|
$
|
337,180
|
|
|
$
|
9,178
|
|
|
$
|
633
|
|
|
$
|
(75,518
|
)
|
|
$
|
271,659
|
|
Issuance of common stock, net of issuance costs
|
—
|
|
—
|
|
|
1,321,362
|
|
14
|
|
|
51,318
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51,332
|
|
|||||||
Stock-based compensation
|
—
|
|
—
|
|
|
221,829
|
|
2
|
|
|
2,749
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,751
|
|
|||||||
Unrecognized loss on cash flow hedges
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,305
|
)
|
|
—
|
|
|
(7,305
|
)
|
|||||||
Reclassification adj for gain included in net income (interest expense)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(154
|
)
|
|
—
|
|
|
(154
|
)
|
|||||||
Net income
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
6,163
|
|
|
—
|
|
|
—
|
|
|
6,163
|
|
|||||||
Dividends to common stockholders ($1.23 per share)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,499
|
)
|
|
(23,499
|
)
|
|||||||
Balance at September 30, 2019
|
—
|
|
$
|
—
|
|
|
20,177,693
|
|
$
|
202
|
|
|
$
|
391,247
|
|
|
$
|
15,341
|
|
|
$
|
(6,826
|
)
|
|
$
|
(99,017
|
)
|
|
$
|
300,947
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at June 30, 2018
|
—
|
|
—
|
|
|
18,199,975
|
|
182
|
|
|
325,719
|
|
|
9,064
|
|
|
2,039
|
|
|
(60,646
|
)
|
|
276,358
|
|
|||||||
Issuance of common stock, net of issuance costs
|
—
|
|
—
|
|
|
234,000
|
|
2
|
|
|
7,062
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,064
|
|
|||||||
Stock-based compensation
|
—
|
|
—
|
|
|
99,827
|
|
1
|
|
|
687
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
688
|
|
|||||||
Unrecognized gain on cash flow hedges
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
527
|
|
|
—
|
|
|
527
|
|
|||||||
Reclassification adj for losses included in net income (interest expense)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46
|
|
|
—
|
|
|
46
|
|
|||||||
Net income
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
1,999
|
|
|
—
|
|
|
—
|
|
|
1,999
|
|
|||||||
Dividends to common stockholders ($0.4025 per share)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,365
|
)
|
|
(7,365
|
)
|
|||||||
Balance at September 30, 2018
|
—
|
|
$
|
—
|
|
|
18,533,802
|
|
185
|
|
|
333,468
|
|
|
11,063
|
|
|
2,612
|
|
|
(68,011
|
)
|
|
279,317
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at December 31, 2017
|
—
|
|
$
|
—
|
|
|
18,085,798
|
|
$
|
181
|
|
|
$
|
324,303
|
|
|
$
|
4,775
|
|
|
$
|
258
|
|
|
$
|
(46,143
|
)
|
|
$
|
283,374
|
|
Issuance of common stock, net of issuance costs
|
—
|
|
—
|
|
|
234,000
|
|
2
|
|
|
7,062
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,064
|
|
|||||||
Stock-based compensation
|
—
|
|
—
|
|
|
214,004
|
|
2
|
|
|
2,103
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,105
|
|
|||||||
Unrecognized gain on cash flow hedges
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,153
|
|
|
—
|
|
|
2,153
|
|
|||||||
Reclassification adj for loss included in net income (interest expense)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
201
|
|
|
—
|
|
|
201
|
|
|||||||
Net income
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
6,288
|
|
|
—
|
|
|
—
|
|
|
6,288
|
|
|||||||
Dividends to common stockholders ($1.20 per share)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,868
|
)
|
|
(21,868
|
)
|
|||||||
Balance at September 30, 2018
|
—
|
|
$
|
—
|
|
|
18,533,802
|
|
$
|
185
|
|
|
$
|
333,468
|
|
|
$
|
11,063
|
|
|
$
|
2,612
|
|
|
$
|
(68,011
|
)
|
|
$
|
279,317
|
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
OPERATING ACTIVITIES
|
|
|
|
||||
Net income
|
$
|
6,163
|
|
|
$
|
6,288
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
16,731
|
|
|
14,929
|
|
||
Stock-based compensation
|
2,751
|
|
|
2,105
|
|
||
Straight-line rent receivable
|
(1,353
|
)
|
|
(1,165
|
)
|
||
Deferred income tax expense (benefit)
|
9
|
|
|
(103
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Other assets
|
(1,889
|
)
|
|
(3,332
|
)
|
||
Accounts payable and accrued liabilities
|
723
|
|
|
(373
|
)
|
||
Other liabilities
|
52
|
|
|
(427
|
)
|
||
Net cash provided by operating activities
|
23,187
|
|
|
17,922
|
|
||
|
|
|
|
||||
INVESTING ACTIVITIES
|
|
|
|
||||
Acquisitions of real estate
|
(115,624
|
)
|
|
(26,820
|
)
|
||
Acquisitions of notes receivable
|
—
|
|
|
(2,201
|
)
|
||
Funding of notes receivable
|
—
|
|
|
(4,833
|
)
|
||
Proceeds from the repayment of notes receivable
|
752
|
|
|
50
|
|
||
Capital expenditures on existing real estate properties
|
(3,461
|
)
|
|
(4,220
|
)
|
||
Net cash used in investing activities
|
(118,333
|
)
|
|
(38,024
|
)
|
||
|
|
|
|
||||
FINANCING ACTIVITIES
|
|
|
|
||||
Net repayments on revolving credit facility
|
(6,750
|
)
|
|
(6,000
|
)
|
||
Term loan borrowings
|
75,000
|
|
|
40,000
|
|
||
Mortgage note repayments
|
(77
|
)
|
|
—
|
|
||
Dividends paid
|
(23,499
|
)
|
|
(21,868
|
)
|
||
Proceeds from issuance of common stock
|
51,640
|
|
|
7,147
|
|
||
Equity issuance costs
|
(308
|
)
|
|
(83
|
)
|
||
Debt issuance costs
|
(1,304
|
)
|
|
(218
|
)
|
||
Net cash provided by financing activities
|
94,702
|
|
|
18,978
|
|
||
Decrease in cash and cash equivalents and restricted cash
|
(444
|
)
|
|
(1,124
|
)
|
||
Cash and cash equivalents and restricted cash, beginning of period
|
2,392
|
|
|
2,130
|
|
||
Cash and cash equivalents and restricted cash, end of period
|
$
|
1,948
|
|
|
$
|
1,006
|
|
|
|
|
|
||||
Supplemental Cash Flow Information:
|
|
|
|
||||
Interest paid
|
$
|
6,380
|
|
|
$
|
3,823
|
|
Invoices accrued for construction, tenant improvement and other capitalized costs
|
$
|
270
|
|
|
$
|
102
|
|
Reclassification between accounts and notes receivable
|
$
|
45
|
|
|
$
|
—
|
|
Reclassification of registration statement costs incurred in prior year to equity issuance costs
|
$
|
321
|
|
|
$
|
34
|
|
(Decrease) increase in fair value of cash flow hedges
|
$
|
(7,305
|
)
|
|
$
|
2,152
|
|
Fair value of property received in foreclosure
|
$
|
—
|
|
|
$
|
4,541
|
|
Notes and mortgage receivable repayments utilized to originate note receivable
|
$
|
—
|
|
|
$
|
18,167
|
|
(Dollars in thousands)
|
Number of Facilities
|
|
Land and
Land Improvements
|
|
Buildings, Improvements, and Lease Intangibles
|
|
Personal
Property
|
|
Total
|
|
Accumulated Depreciation
|
|||||||||||
Medical office buildings:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Florida
|
5
|
|
|
$
|
4,648
|
|
|
$
|
29,384
|
|
|
$
|
—
|
|
|
$
|
34,032
|
|
|
$
|
5,328
|
|
Ohio
|
6
|
|
|
3,665
|
|
|
26,578
|
|
|
—
|
|
|
30,243
|
|
|
6,209
|
|
|||||
Texas
|
3
|
|
|
3,164
|
|
|
15,591
|
|
|
—
|
|
|
18,755
|
|
|
4,862
|
|
|||||
Illinois
|
3
|
|
|
1,918
|
|
|
15,019
|
|
|
—
|
|
|
16,937
|
|
|
3,195
|
|
|||||
Kansas
|
3
|
|
|
2,455
|
|
|
15,539
|
|
|
—
|
|
|
17,994
|
|
|
4,480
|
|
|||||
Iowa
|
1
|
|
|
2,241
|
|
|
9,062
|
|
|
—
|
|
|
11,303
|
|
|
2,967
|
|
|||||
Other states
|
16
|
|
|
5,587
|
|
|
40,952
|
|
|
—
|
|
|
46,539
|
|
|
5,805
|
|
|||||
|
37
|
|
|
23,678
|
|
|
152,125
|
|
|
—
|
|
|
175,803
|
|
|
32,846
|
|
|||||
Physician clinics:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Kansas
|
2
|
|
|
610
|
|
|
6,921
|
|
|
—
|
|
|
7,531
|
|
|
1,690
|
|
|||||
Illinois
|
6
|
|
|
2,888
|
|
|
9,709
|
|
|
—
|
|
|
12,597
|
|
|
838
|
|
|||||
Florida
|
5
|
|
|
506
|
|
|
10,322
|
|
|
—
|
|
|
10,828
|
|
|
1,101
|
|
|||||
Other states
|
9
|
|
|
2,903
|
|
|
21,742
|
|
|
—
|
|
|
24,645
|
|
|
3,984
|
|
|||||
|
22
|
|
|
6,907
|
|
|
48,694
|
|
|
—
|
|
|
55,601
|
|
|
7,613
|
|
|||||
Surgical centers and hospitals:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Louisiana
|
1
|
|
|
1,683
|
|
|
21,353
|
|
|
—
|
|
|
23,036
|
|
|
1,511
|
|
|||||
Michigan
|
2
|
|
|
637
|
|
|
8,383
|
|
|
—
|
|
|
9,020
|
|
|
2,623
|
|
|||||
Illinois
|
2
|
|
|
2,355
|
|
|
8,222
|
|
|
—
|
|
|
10,577
|
|
|
1,797
|
|
|||||
Florida
|
1
|
|
|
271
|
|
|
7,070
|
|
|
—
|
|
|
7,341
|
|
|
1,043
|
|
|||||
Arizona
|
2
|
|
|
576
|
|
|
5,389
|
|
|
—
|
|
|
5,965
|
|
|
1,774
|
|
|||||
Other states
|
7
|
|
|
2,130
|
|
|
17,935
|
|
|
—
|
|
|
20,065
|
|
|
4,534
|
|
|||||
|
15
|
|
|
7,652
|
|
|
68,352
|
|
|
—
|
|
|
76,004
|
|
|
13,282
|
|
|||||
Specialty centers:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Illinois
|
3
|
|
|
3,489
|
|
|
24,733
|
|
|
—
|
|
|
28,222
|
|
|
2,916
|
|
|||||
Other states
|
22
|
|
|
5,207
|
|
|
38,623
|
|
|
—
|
|
|
43,830
|
|
|
8,365
|
|
|||||
|
25
|
|
|
8,696
|
|
|
63,356
|
|
|
—
|
|
|
72,052
|
|
|
11,281
|
|
|||||
Behavioral facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Massachusetts
|
1
|
|
|
3,835
|
|
|
23,303
|
|
|
—
|
|
|
27,138
|
|
|
177
|
|
|||||
West Virginia
|
1
|
|
|
2,138
|
|
|
22,897
|
|
|
—
|
|
|
25,035
|
|
|
1,171
|
|
|||||
Illinois
|
1
|
|
|
1,300
|
|
|
18,803
|
|
|
—
|
|
|
20,103
|
|
|
1,568
|
|
|||||
Washington
|
1
|
|
|
2,725
|
|
|
25,064
|
|
|
—
|
|
|
27,789
|
|
|
120
|
|
|||||
Other states
|
5
|
|
|
2,538
|
|
|
18,880
|
|
|
—
|
|
|
21,418
|
|
|
1,097
|
|
|||||
|
9
|
|
|
12,536
|
|
|
108,947
|
|
|
—
|
|
|
121,483
|
|
|
4,133
|
|
|||||
Inpatient rehabilitation facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Texas
|
2
|
|
|
3,023
|
|
|
44,530
|
|
|
—
|
|
|
47,553
|
|
|
548
|
|
|||||
|
2
|
|
|
3,023
|
|
|
44,530
|
|
|
—
|
|
|
47,553
|
|
|
548
|
|
|||||
Long-term acute care hospitals:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Indiana
|
1
|
|
|
523
|
|
|
14,405
|
|
|
—
|
|
|
14,928
|
|
|
1,566
|
|
|||||
|
1
|
|
|
523
|
|
|
14,405
|
|
|
—
|
|
|
14,928
|
|
|
1,566
|
|
|||||
Corporate property
|
—
|
|
|
—
|
|
|
2,701
|
|
|
202
|
|
|
2,903
|
|
|
348
|
|
|||||
Total real estate investments
|
111
|
|
|
$
|
63,015
|
|
|
$
|
503,110
|
|
|
$
|
202
|
|
|
$
|
566,327
|
|
|
$
|
71,617
|
|
2019 (three months ending December 31)
|
$
|
12,889
|
|
2020
|
49,652
|
|
|
2021
|
46,663
|
|
|
2022
|
43,440
|
|
|
2023
|
39,016
|
|
|
2024 and thereafter
|
247,654
|
|
|
|
$
|
439,314
|
|
|
|
|
Relative Fair Value
|
Estimated Useful Life
|
||
|
|
|
(in thousands)
|
(In years)
|
||
Land and land improvements
|
$
|
12,497
|
|
4.7-18.4
|
||
Building and building improvements
|
103,253
|
|
20-40
|
|||
Intangibles:
|
|
|
||||
|
At-market lease intangibles
|
2,186
|
|
3.8-10.8
|
||
|
Below-market lease intangibles
|
(44
|
)
|
8.3
|
||
|
|
Total intangibles
|
2,142
|
|
|
|
Accounts receivable and other assets assumed
|
15
|
|
|
|||
Accounts payable, accrued liabilities and other liabilities assumed
|
(2,198
|
)
|
|
|||
Prorated rent, interest and operating expense reimbursement amounts collected
|
(85
|
)
|
|
|||
|
Total cash consideration
|
$
|
115,624
|
|
|
|
Balance as of
|
|
|||||
(Dollars in thousands)
|
September 30, 2019
|
December 31, 2018
|
Maturity Dates
|
||||
|
|
|
|
||||
Revolving Credit Facility
|
$
|
36,250
|
|
$
|
43,000
|
|
3/23
|
A-1 Term Loan, net
|
49,815
|
|
49,759
|
|
3/22
|
||
A-2 Term Loan, net
|
49,761
|
|
49,722
|
|
3/24
|
||
A-3 Term Loan, net
|
74,411
|
|
—
|
|
3/26
|
||
Mortgage Note Payable
|
5,223
|
|
5,285
|
|
5/24
|
||
|
$
|
215,460
|
|
$
|
147,766
|
|
|
|
Asset Derivatives Fair Value at
|
|
Liability Derivatives Fair Value at
|
||||||||||||
|
September 30, 2019
|
December 31, 2018
|
Balance Sheet Classification
|
|
September 30, 2019
|
December 31, 2018
|
Balance Sheet Classification
|
||||||||
Interest rate swaps
|
$
|
—
|
|
$
|
902
|
|
Other assets
|
|
$
|
6,826
|
|
$
|
98
|
|
Other Liabilities
|
|
Three Months Ended September 30,
|
|
Nine Months Ended
September 30, |
||||||||||
(Dollars in thousands)
|
2019
|
2018
|
|
2019
|
2018
|
||||||||
Amount of unrealized (loss) gain recognized in OCI on derivative
|
$
|
(2,060
|
)
|
$
|
527
|
|
|
$
|
(7,305
|
)
|
$
|
2,152
|
|
Amount of (gain) loss reclassified from accumulated OCI into interest expense
|
$
|
3
|
|
$
|
46
|
|
|
$
|
(154
|
)
|
$
|
201
|
|
Total Interest Expense presented in the Condensed Consolidated Statements of Income in which the effects of the cash flow hedges are recorded
|
$
|
2,483
|
|
$
|
1,643
|
|
|
$
|
6,788
|
|
$
|
4,482
|
|
|
Nine Months Ended
September 30, 2019 |
Year Ended
December 31, 2018
|
||
Balance, beginning of period
|
18,634,502
|
|
18,085,798
|
|
Issuance of common stock
|
1,321,362
|
|
334,700
|
|
Restricted stock-based awards
|
221,829
|
|
214,004
|
|
Balance, end of period
|
20,177,693
|
|
18,634,502
|
|
|
Three Months Ended
September 30, 2019 |
|
Nine Months Ended
September 30, 2019 |
||||
Shares issued
|
680,309
|
|
|
1,321,362
|
|
||
Proceeds received (in millions)
|
$
|
28.5
|
|
|
$
|
51.6
|
|
Average gross sales price per share ($)
|
$
|
42.70
|
|
|
$
|
39.88
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(Dollars in thousands, except per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
2,647
|
|
|
$
|
1,999
|
|
|
$
|
6,163
|
|
|
$
|
6,288
|
|
Participating securities' share in earnings
|
(373
|
)
|
|
(287
|
)
|
|
(1,024
|
)
|
|
(769
|
)
|
||||
Net income, less participating securities' share in earnings
|
$
|
2,274
|
|
|
$
|
1,712
|
|
|
$
|
5,139
|
|
|
$
|
5,519
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average Common Shares outstanding
|
|
|
|
|
|
|
|
||||||||
Weighted average Common Shares outstanding
|
19,697,574
|
|
|
18,330,340
|
|
|
19,166,309
|
|
|
18,228,006
|
|
||||
Unvested restricted shares
|
(864,672
|
)
|
|
(660,659
|
)
|
|
(818,679
|
)
|
|
(532,318
|
)
|
||||
Weighted average Common Shares outstanding–Basic
|
18,832,902
|
|
|
17,669,681
|
|
|
18,347,630
|
|
|
17,695,688
|
|
||||
Dilutive potential common shares
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Weighted average Common Shares outstanding –Diluted
|
18,832,902
|
|
|
17,669,681
|
|
|
18,347,630
|
|
|
17,695,688
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic Net Income per Common Share
|
$
|
0.12
|
|
|
$
|
0.10
|
|
|
$
|
0.28
|
|
|
$
|
0.31
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted Net Income per Common Share
|
$
|
0.12
|
|
|
$
|
0.10
|
|
|
$
|
0.28
|
|
|
$
|
0.31
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended
September 30, |
||||||
|
|
2019
|
2018
|
|
2019
|
2018
|
||||
Stock-based awards, beginning of period
|
813,752
|
|
609,660
|
|
|
709,487
|
|
512,115
|
|
|
|
Stock in lieu of compensation
|
14,862
|
|
17,420
|
|
|
72,391
|
|
69,767
|
|
|
Stock awards
|
81,278
|
|
82,407
|
|
|
149,438
|
|
144,237
|
|
|
Total stock granted
|
96,140
|
|
99,827
|
|
|
221,829
|
|
214,004
|
|
|
Vested shares
|
—
|
|
—
|
|
|
(21,424
|
)
|
(16,632
|
)
|
Stock-based awards, end of period
|
909,892
|
|
709,487
|
|
|
909,892
|
|
709,487
|
|
|
Balance as of
|
|||||
(Dollars in thousands)
|
September 30, 2019
|
December 31, 2018
|
||||
Notes receivable
|
$
|
23,402
|
|
$
|
24,110
|
|
Accounts and interest receivables
|
3,573
|
|
2,158
|
|
||
Straight-line rent receivables
|
4,567
|
|
3,254
|
|
||
Prepaid assets
|
688
|
|
487
|
|
||
Deferred financing costs, net
|
746
|
|
318
|
|
||
Leasing commissions, net
|
900
|
|
790
|
|
||
Deferred tax asset
|
2,016
|
|
2,024
|
|
||
Fair value of interest rate swaps
|
—
|
|
902
|
|
||
Above-market intangible assets, net
|
150
|
|
168
|
|
||
Right-of-use leased asset
|
140
|
|
—
|
|
||
Other
|
232
|
|
335
|
|
||
|
$
|
36,414
|
|
$
|
34,546
|
|
•
|
On April 25, 2018, the Company provided a $23.0 million loan to a newly formed company, secured by all assets and ownership interests in seven long-term acute care hospitals and one inpatient rehabilitation hospital. The loan, which matures on May 1, 2031, currently bears interest at 9% per annum, with principal payments beginning in May 2021.
|
•
|
On December 31, 2018, the Company entered into notes with a tenant totaling $0.9 million. The notes bear interest at 9% per annum and mature on December 31, 2019.
|
Classification
|
Carrying Amount
(in millions)
|
Maximum Exposure to Loss
(in millions)
|
||||
Notes receivable
|
$
|
0.4
|
|
$
|
0.4
|
|
Note receivable
|
$
|
23.0
|
|
$
|
23.0
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||
(Dollars in thousands)
|
Carrying Value
|
Fair Value
|
|
Carrying Value
|
Fair Value
|
||||||||
Notes receivable
|
$
|
23,402
|
|
$
|
23,494
|
|
|
$
|
24,110
|
|
$
|
23,936
|
|
Interest rate swap asset
|
$
|
—
|
|
$
|
—
|
|
|
$
|
902
|
|
$
|
902
|
|
Interest rate swap liability
|
$
|
6,826
|
|
$
|
6,826
|
|
|
$
|
269
|
|
$
|
269
|
|
Mortgage note payable
|
$
|
5,314
|
|
$
|
5,323
|
|
|
$
|
5,391
|
|
$
|
5,307
|
|
|
Three Months Ended September 30,
|
|
Increase (Decrease) to
Net Income
|
||||||||||
(dollars in thousands)
|
2019
|
|
2018
|
|
$
|
%
|
|||||||
REVENUES
|
|
|
|
|
|
|
|||||||
Rental income
|
$
|
15,718
|
|
|
$
|
11,858
|
|
|
$
|
3,860
|
|
32.6
|
%
|
Other operating interest
|
541
|
|
|
679
|
|
|
(138
|
)
|
(20.3
|
)%
|
|||
|
16,259
|
|
|
12,537
|
|
|
3,722
|
|
29.7
|
%
|
|||
EXPENSES
|
|
|
|
|
|
|
|||||||
Property operating
|
3,327
|
|
|
2,627
|
|
|
(700
|
)
|
(26.6
|
)%
|
|||
General and administrative
|
2,041
|
|
|
1,395
|
|
|
(646
|
)
|
(46.3
|
)%
|
|||
Depreciation and amortization
|
5,774
|
|
|
4,925
|
|
|
(849
|
)
|
(17.2
|
)%
|
|||
|
11,142
|
|
|
8,947
|
|
|
(2,195
|
)
|
(24.5
|
)%
|
|||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND OTHER ITEMS
|
5,117
|
|
|
3,590
|
|
|
1,527
|
|
42.5
|
%
|
|||
Interest expense
|
(2,483
|
)
|
|
(1,643
|
)
|
|
(840
|
)
|
(51.1
|
)%
|
|||
Other income
|
13
|
|
|
52
|
|
|
(39
|
)
|
(75.0
|
)%
|
|||
INCOME FROM CONTINUING OPERATIONS
|
2,647
|
|
|
1,999
|
|
|
648
|
|
32.4
|
%
|
|||
NET INCOME
|
$
|
2,647
|
|
|
$
|
1,999
|
|
|
$
|
648
|
|
32.4
|
%
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(Dollars in thousands, excepts per share amounts)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
2,647
|
|
|
$
|
1,999
|
|
|
$
|
6,163
|
|
|
$
|
6,288
|
|
Real estate depreciation and amortization
|
5,812
|
|
|
4,918
|
|
|
16,434
|
|
|
14,453
|
|
||||
Total adjustments
|
5,812
|
|
|
4,918
|
|
|
16,434
|
|
|
14,453
|
|
||||
Funds from Operations
|
$
|
8,459
|
|
|
$
|
6,917
|
|
|
$
|
22,597
|
|
|
$
|
20,741
|
|
Funds from Operations per Common Share-Basic
|
$
|
0.45
|
|
|
$
|
0.39
|
|
|
$
|
1.23
|
|
|
$
|
1.17
|
|
Funds from Operations per Common Share-Diluted
|
$
|
0.44
|
|
|
$
|
0.39
|
|
|
$
|
1.20
|
|
|
$
|
1.16
|
|
Weighted Average Common Shares Outstanding-Basic
|
18,832,902
|
|
|
17,669,681
|
|
|
18,347,630
|
|
|
17,695,688
|
|
||||
Weighted Average Common Shares Outstanding-Diluted (1)
|
19,315,354
|
|
|
17,947,568
|
|
|
18,769,670
|
|
|
17,839,014
|
|
•
|
Leverage ratios and financial covenants included in our Credit Facility;
|
•
|
Dividend payout percentage; and
|
•
|
Interest rates, underlying treasury rates, debt market spreads and equity markets.
|
•
|
the requirement that our independent registered public accounting firm attest to the effectiveness of our internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act of 2002;
|
•
|
compliance with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements;
|
•
|
the requirement that we provide full and more detailed disclosures regarding executive compensation; and
|
•
|
the requirement that we hold a non-binding advisory vote on executive compensation and obtain stockholder approval of any golden parachute payments not previously approved.
|
Exhibit
Number
|
Description
|
||
3.1
|
|||
3.2
|
|||
31.1 *
|
|||
31.2 *
|
|||
32.1 **
|
|||
101.INS
|
XBRL Instance Document
|
||
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
||
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
||
101.LAB
|
XBRL Taxonomy Extension Labels Linkbase Document
|
||
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
||
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
||
|
|
(1)
|
Filed as Exhibit 3.1 to Amendment No. 2 to the Registration Statement on Form S-11 of the Company filed with the Securities and Exchange Commission on May 6, 2015 (Registration No. 333-203210) and incorporated herein by reference.
|
(2)
|
Filed as Exhibit 3.2 to the Registration Statement on Form S-11 of the Company filed with the Securities and Exchange Commission on April 2, 2015 (Registration No. 333-203210) and incorporated herein by reference.
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
|
COMMUNITY HEALTHCARE TRUST INCORPORATED
|
|
|
|
|
|
By:
|
/s/ Timothy G. Wallace
|
|
|
Timothy G. Wallace
|
|
|
Chief Executive Officer and President
|
|
|
|
|
By:
|
/s/ David H. Dupuy
|
|
|
David H. Dupuy
|
|
|
Executive Vice President and Chief Financial Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Community Healthcare Trust Incorporated;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Timothy G. Wallace
|
|
Timothy G. Wallace
|
|
Chief Executive Officer and President
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Community Healthcare Trust Incorporated;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ David H. Dupuy
|
|
David H. Dupuy
|
|
Executive Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ Timothy G. Wallace
|
|
Timothy G. Wallace
|
|
Chief Executive Officer and President
|
|
|
|
/s/ David H. Dupuy
|
|
David H. Dupuy
|
|
Executive Vice President and Chief Financial Officer
|