SEC Company Response from Brookdale Senior Living Inc. (BKD) (CIK 0001332349) (BKD) — Nov 16, 2005
Brookdale Senior Living Inc. (BKD) (CIK 0001332349)
Date: Nov. 16, 2005 · CIK: 0001332349 · Accession: 0000950123-05-013714
AI Filing Summary & Sentiment
File numbers found in text: 333-127372
Referenced dates: October 10, 2005, October 21, 2005
Letter
RE: Brookdale Senior Living Inc. Registration Statement on Form S-1 (File No. 333-127372)
<PAGE> October 25, 2005
BY FACSIMILE AND HAND
Ms. Sandra Stokes Mr. Terry French Mr. Alonso Rodriguez Albert Pappas, Esq. Securities and Exchange Commission Division of Corporation Finance Mail Stop 3561 100 F Street, N.E. Washington, D.C. 20549
Ladies and Gentlemen:
On behalf of Brookdale Senior Living Inc., a Delaware corporation (the "Company"), in response to the Staff's comment number 12 in its letter dated October 21, 2005, our conference call on October 24, 2005 and our conference call on October 19, 2005 regarding comments 23-25 in the Staff's previous letter dated October 10, 2005, we respectfully submit examples of reports used by our chief operating decision makers ("CODM"). The attached reports detail the occupancy, revenue, operating expenses and net operating income for each facility. Please note that the Company is currently in the process of consolidating its reporting as a result of the formation transaction. Accordingly, the reports for each of the 380 facilities provided to you are summarized by individual company - Brookdale Living Communities, Inc., Alterra Healthcare Corporation, Fortress CCRC portfolio (a/k/a NBA) and the Prudential Portfolio.
In reviewing the attached schedules you will note that only facility occupancy, revenue, operating expenses and net operating income are provided to the CODM. While a number of services are provided to our residents at each of the these facilities, the CODM does not differentiate between the various services provided to the residents and views the fees earned and expenses incurred for these services as the facility's net operating income. The Company would also like to point out to the Staff the wide range of net operating margins for the properties attached.
<PAGE>
Consistent with our conversation, the Company has reviewed the discrete financial information for each of the 380 facilities that is provided to the CODM under the provisions of FAS 131, paragraph 17, for aggregating reporting segments. The Company has concluded that its economic characteristics, based on the nature of its products and services, the nature of its production process, the type and class of customer for its products and services, and the methods used to distribute its products and services, are similar. However, each facility's net operating income and related margin vary significantly across the portfolio. Under this analysis, the Company has concluded that it cannot apply the provisions of FAS 131, paragraph 17, or meet the quantitative thresholds of FAS 131, paragraphs 18 and 19, to get to ten operating segments or less as outlined in FAS 131, paragraph 24 based upon the information used by the CODM.
The Company has determined that the most meaningful presentation is to aggregate and report segments under FAS 131, paragraph 19, along product lines. We have defined the product line reporting segments as: (i) retirement centers, including independent living facilities and continuing care retirement communities that provide a wide range of services to their residents, (ii) free-standing assisted living communities that provide specialized care (consisting of assistance with two or three activities of daily living (ADLs)) and including Alzheimer's and other dementia programs, and (iii) third party management services. These individual reportable segments share the majority of the aggregation criteria in paragraph 17 namely, similar product type, services, customers, etc. This presentation is considered consistent with the description of the Company's product offerings in the filing and provides comparable operating information to what others in the industry (e.g., American Retirement Corporation) are disclosing. An excerpt from American Retirement's most recent Quarterly Report on Form 10-Q describing its reporting segments is also attached to this letter.
We previously have provided to you the Company's revised segment disclosure in the correspondence sent to your office on October 20, 2005. The Company believes that these reporting segments represent the most practical and meaningful approach to display to the financial reader required segment information relating to the 380 individual facilities.
Please contact the undersigned at (212) 735-3050 should you require further information or have any questions.
Very truly yours,
/s/ Joseph A. Coco
----------------------------------------
Joseph A. Coco, Esq.
Show Raw Text
<DOCUMENT>
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<TEXT>
<PAGE>
October 25, 2005
BY FACSIMILE AND HAND
Ms. Sandra Stokes
Mr. Terry French
Mr. Alonso Rodriguez
Albert Pappas, Esq.
Securities and Exchange Commission
Division of Corporation Finance
Mail Stop 3561
100 F Street, N.E.
Washington, D.C. 20549
RE: Brookdale Senior Living Inc.
Registration Statement on Form S-1 (File No. 333-127372)
Ladies and Gentlemen:
On behalf of Brookdale Senior Living Inc., a Delaware corporation (the
"Company"), in response to the Staff's comment number 12 in its letter dated
October 21, 2005, our conference call on October 24, 2005 and our conference
call on October 19, 2005 regarding comments 23-25 in the Staff's previous letter
dated October 10, 2005, we respectfully submit examples of reports used by our
chief operating decision makers ("CODM"). The attached reports detail the
occupancy, revenue, operating expenses and net operating income for each
facility. Please note that the Company is currently in the process of
consolidating its reporting as a result of the formation transaction.
Accordingly, the reports for each of the 380 facilities provided to you are
summarized by individual company - Brookdale Living Communities, Inc., Alterra
Healthcare Corporation, Fortress CCRC portfolio (a/k/a NBA) and the Prudential
Portfolio.
In reviewing the attached schedules you will note that only facility
occupancy, revenue, operating expenses and net operating income are provided to
the CODM. While a number of services are provided to our residents at each of
the these facilities, the CODM does not differentiate between the various
services provided to the residents and views the fees earned and expenses
incurred for these services as the facility's net operating income. The Company
would also like to point out to the Staff the wide range of net operating
margins for the properties attached.
<PAGE>
Consistent with our conversation, the Company has reviewed the
discrete financial information for each of the 380 facilities that is provided
to the CODM under the provisions of FAS 131, paragraph 17, for aggregating
reporting segments. The Company has concluded that its economic characteristics,
based on the nature of its products and services, the nature of its production
process, the type and class of customer for its products and services, and the
methods used to distribute its products and services, are similar. However, each
facility's net operating income and related margin vary significantly across the
portfolio. Under this analysis, the Company has concluded that it cannot apply
the provisions of FAS 131, paragraph 17, or meet the quantitative thresholds of
FAS 131, paragraphs 18 and 19, to get to ten operating segments or less as
outlined in FAS 131, paragraph 24 based upon the information used by the CODM.
The Company has determined that the most meaningful presentation is to
aggregate and report segments under FAS 131, paragraph 19, along product lines.
We have defined the product line reporting segments as: (i) retirement centers,
including independent living facilities and continuing care retirement
communities that provide a wide range of services to their residents, (ii)
free-standing assisted living communities that provide specialized care
(consisting of assistance with two or three activities of daily living (ADLs))
and including Alzheimer's and other dementia programs, and (iii) third party
management services. These individual reportable segments share the majority of
the aggregation criteria in paragraph 17 namely, similar product type, services,
customers, etc. This presentation is considered consistent with the description
of the Company's product offerings in the filing and provides comparable
operating information to what others in the industry (e.g., American Retirement
Corporation) are disclosing. An excerpt from American Retirement's most recent
Quarterly Report on Form 10-Q describing its reporting segments is also attached
to this letter.
We previously have provided to you the Company's revised segment
disclosure in the correspondence sent to your office on October 20, 2005. The
Company believes that these reporting segments represent the most practical and
meaningful approach to display to the financial reader required segment
information relating to the 380 individual facilities.
Please contact the undersigned at (212) 735-3050 should you require
further information or have any questions.
Very truly yours,
/s/ Joseph A. Coco
----------------------------------------
Joseph A. Coco, Esq.
<PAGE>
ALTERRA HEALTHCARE CORPORATION Page: 1 of 4
NET OPERATING INCOME (NOI)
PERIOD 9 2005
<TABLE>
<CAPTION>
SEPTEMBER
---------------------------------------------------------------
REVENUE OPERATING EXPENSES NOI $$'S
------------------- ------------------- -------------------
B/(W) B/(W) B/(W)
ACTUAL BUDGET ACTUAL BUDGET ACTUAL BUDGET
--------- ------- --------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
ACTIVE PROJECTS
REPORTABLE
EASTERN DIVISION
FLORIDA REGION
04010 CB Bradenton, FL 130,076 (5,156) 92,921 10,061 37,156 4,905
04590 SH Spring Hill, FL 126,670 (599) 73,540 2,242 53,131 1,643
04700 SH Winter Haven, FL 128,479 (6,546) 71,205 1,448 57,273 (5,098)
04860 CBC Winter Haven, FL 109,688 27,361 65,873 14,183 43,815 41,544
FL - Pamela Cutsuries 494,914 15,060 303,539 27,934 191,375 42,995
--------- ------- --------- ------- --------- -------
04300 SH Deland, FL 68,164 2,567 64,183 3,695 3,982 6,262
04360 SH Merrimac, FL 157,760 6,713 62,470 9,398 95,290 16,111
04370 SH Jacksonville, FL 124,051 (23,622) 74,922 11,408 49,129 (12,214)
04440 SH West Melbourne I, FL 115,356 (4,543) 67,616 1,748 47,741 (2,795)
04480 SH Ormond Beach, FL 136,977 (1,920) 89,191 (18,624) 47,786 (20,544)
04490 SH Palm Coast, FL 170,155 1,854 77,449 (1,562) 92,706 292
04500 CB Jacksonville, FL 148,223 6,291 88,316 3,134 59,906 9,425
04550 SH Port Orange, FL 154,891 15,088 77,251 (6,592) 77,640 8,496
04610 SH Stuart, FL 105,847 (9,977) 63,889 12,903 41,958 2,925
04680 SH Vero Beach, FL 125,195 1,994 72,750 705 52,445 2,699
04690 SH West Melbourne II, FL 126,778 (1,780) 62,750 5,217 64,029 3,437
04870 CBC Vero Beach, FL 99,179 16,190 67,499 9,478 31,681 25,668
04900 CB West Melbourne, FL 173,550 14,394 86,131 3,194 87,419 17,587
FL - Joyce Latimer 1,706,127 23,247 954,416 34,102 751,711 57,349
--------- ------- --------- ------- --------- -------
04100 CB Tallahasee, FL 164,152 12,434 94,339 2,179 69,814 14,614
04250 SH Blue Water Bay, FL 142,781 5,922 83,716 (2,384) 59,065 3,538
04330 SH Gainesville, FL 124,211 (13,916) 90,503 (9,204) 33,708 (23,120)
04410 SH Leesburg, FL 146,470 (302) 74,521 1,752 71,949 1,450
04520 CB Gainesville, FL 107,768 5,172 93,332 (10,153) 14,435 (4,981)
04530 SH Panama City, FL 144,101 4,920 72,924 1,655 71,177 6,575
04540 SH Pensacola, FL 170,937 8,675 114,545 (21,958) 56,392 (13,284)
04630 SH Tallahassee, FL 98,889 (15,982) 30,538 47,726 68,351 31,744
04640 SH Tavares, FL 149,419 2,992 66,012 13,603 83,407 16,595
04850 CBC Leesburg, FL 164,776 14,736 89,637 1,478 75,139 16,214
FL - Ann Navarra 1,413,505 24,649 810,067 24,695 603,438 49,344
--------- ------- --------- ------- --------- -------
04030 CB Sarasota, FL 163,434 (5,327) 111,442 (9,827) 51,992 (15,154)
04040 CB Ft. Myers at the Colony, FL 100,791 10,924 88,799 (8,365) 11,992 2,559
04280 SH Cape Coral, FL 155,999 1,625 86,870 (7,866) 69,129 (6,241)
04310 SH Englewood, FL 167,362 21,949 89,039 (6,530) 78,323 15,419
04320 SH Fort Myers, FL 129,337 (10,110) 87,055 (13,453) 42,282 (23,562)
04420 SH Lehigh Acres, FL 143,731 (3,868) 87,332 (4,382) 56,399 (8,250)
04570 SH Port Charlotte, FL 106,961 (9,792) 73,061 9,077 33,900 (716)
04580 SH Punta Gorda, FL 135,925 6,851 73,437 8,555 62,488 15,406
04650 SH Tequesta I, FL 156,245 3,084 82,592 (6,216) 73,653 (3,133)
04660 CBC Tequesta, FL 117,286 (16,351) 75,575 15,749 41,711 (602)
04670 SH Venice, FL 151,403 9,819 87,041 9,146 64,362 18,965
04910 CB Cape Coral, FL 120,763 (9,604) 95,876 (14,640) 24,887 (24,244)
FL - Rebecca Rickenbach 1,649,238 (800) 1,038,120 (28,752) 611,118 (29,552)
--------- ------- --------- ------- --------- -------
FLORIDA REGION 5,263,784 62,157 3,106,142 57,979 2,157,642 120,137
NY NJ PA REGION
06090 VL Sherman Brook, NY 180,206 8,756 85,421 9,427 94,785 18,183
06100 VL Summerfield, NY 211,323 4,697 91,340 14,404 119,983 19,102
NY NJ PA - Kathleen Richards 391,530 13,454 176,761 23,832 214,768 37,285
--------- ------- --------- ------- --------- -------
06020 CB Niskayuna, NY 215,551 (12,399) 120,724 16,538 94,827 4,139
06060 WW Manlius, NY 308,002 3,912 162,411 (8,356) 145,591 (4,445)
06070 WW Niskayuna, NY 368,063 (3,807) 178,075 25,780 189,988 21,972
06130 SH Ithaca, NY 154,704 (471) 86,500 3,464 68,204 2,993
06220 CBC Ithaca, NY 100,259 3,588 64,776 13,005 35,483 16,593
06250 CBC Clinton, NY 115,301 (17,379) 78,392 262 36,909 (17,117)
06510 CB Manlius, NY 162,665 (8,131) 106,641 142 56,024 (7,989)
NY NJ PA - Kathleen Melkun 1,424,545 (34,687) 797,519 50,834 627,026 16,147
--------- ------- --------- ------- --------- -------
05010 WW Northampton Manor, PA 223,532 (17,837) 180,619 (12,607) 42,913 (30,444)
05030 CB Montgomery, PA 165,680 (11,905) 105,460 7,613 60,220 (4,292)
05040 WW Montgomery, PA 157,597 (30,463) 108,558 (4,940) 49,039 (35,402)
05050 CB Hamilton, NJ 231,567 23,737 111,378 20,566 120,190 44,303
05060 CB Westampton, NJ 226,213 39,322 140,172 8,911 86,041 48,233
05230 SH Deptford I & II, NJ 110,834 34,929 109,968 (9,250) 866 25,679
05330 SH Florence, NJ 147,075 (1,178) 85,115 7,649 61,960 6,470
05410 CBC Dublin, PA 118,153 9,278 68,580 8,856 49,573 18,134
NY NJ PA - Carolyn Risilia 1,380,651 45,883 909,849 26,798 470,802 72,681
--------- ------- --------- ------- --------- -------
05130 CB Murrysville, PA 81,017 (5,567) 80,773 (5,770) 244 (11,336)
05150 SH Penn Hills, PA 61,716 (10,806) 33,547 12,154 28,169 1,348
06030 CB Williamsville, NY 165,843 14,803 91,391 2,220 74,451 17,023
06040 CB Perinton, NY 95,024 (9,629) 78,675 10,822 16,349 1,193
06050 WW Kenmore, NY 323,554 (3,754) 179,859 29,938 143,694 26,185
06230 CBC Niagara, NY 144,189 (14,203) 74,724 10,225 69,465 (3,978)
06240 SH Niagara, NY 167,568 8,758 77,798 9,558 89,770 18,317
NY NJ PA - Christine Stricklin 1,038,911 (20,397) 616,768 69,148 422,142 48,751
--------- ------- --------- ------- --------- -------
NY NJ PA REGION 4,235,637 4,252 2,500,899 170,612 1,734,738 174,864
NC SC TN REGION
03360 SH Park Lane, SC 73,081 (10,741) 75,829 (16,246) (2,748) (26,987)
03370 SH Harbison, SC 63,033 (6,017) 55,031 2,996 8,002 (3,021)
03380 SH Sumter, SC 87,297 5,518 63,305 (3,839) 23,992 1,679
03400 SH Greenville, SC 84,916 (61) 56,292 7,621 28,623 7,559
03420 SH Greenwood, SC 99,183 1,548 59,534 4,239 39,648 5,787
03470 SH Central, SC 129,140 6,226