NATIONAL HEALTH INVESTORS INC

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

(a)The Condensed Consolidated Balance Sheets include the following amounts related to our consolidated variable interest entities: $502.5 million and $505.9 million of Real estate properties, net; $5.8 million and $9.7 million of Cash and cash equivalents; $10.1 million and $10.0 million of Straight-line rents receivable; $6.7 million and $7.5 million of Other assets, net; and $3.4 million and $5.7 million of Accounts payable and accrued expenses, in each case as of March 31, 2025 and December 31, 2024, respectively.

The accompanying notes to condensed consolidated financial statements are an integral part of these condensed consolidated financial statements. The Condensed Consolidated Balance Sheet at December 31, 2024 was derived from the audited consolidated financial statements at that date.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except share and per share amounts)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in thousands)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

(in thousands)

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(unaudited, in thousands, except share and per share amounts)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2025

(unaudited)

Note 1. Organization and Nature of Business

National Health Investors, Inc. (“NHI,” the “Company,” “we,” “us,” or “our”), established in 1991 as a Maryland corporation, is a self-managed real estate investment trust (“REIT”) specializing in sale-leaseback, joint venture and mortgage and mezzanine financing of need-driven and discretionary senior housing and medical facility investments. We operate throughtwo reportable segments: Real Estate Investments and Senior Housing Operating Portfolio (“SHOP”).

Our Real Estate Investments segment consists of real estate investments, leases, and mortgage and other notes receivable in independent living facilities (“ILFs”), assisted living facilities (“ALFs”), entrance-fee communities (“EFCs”), senior living campuses (“SLCs”), skilled nursing facilities (“SNFs”) and hospitals (“HOSPs”). As of March 31, 2025, we had gross real estate investments of approximately $2.7 billion in 175 healthcare real estate properties located in 32 states and leased pursuant primarily to triple-net leases to 30 tenants consisting of 109 senior housing communities,65 SNFs andone HOSP. Our portfolio often mortgages along with other notes receivable totaled $278.7 million, excluding an allowance for expected credit losses of $18.9 million, as of March 31, 2025.

Our SHOP segment is comprised oftwo ventures that own the operations of ILFs. For this segment, as of March 31, 2025, we had gross real estate investments of approximately $359.8 million in 15 ILFs located ineight states with a combined 1,732 units that are operated on behalf of the Company by independent managers pursuant to the terms of separate management agreements. The third-party managers, or related parties of the managers, own equity interests in the respective ventures. Units, beds and property count disclosures in these notes to the condensed consolidated financial statements are outside the scope of our independent registered accounting firm’s review.

Note 2. Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) for interim financial statements. In our opinion, the accompanying unaudited condensed consolidated financial statements reflect all adjustments consisting of normal recurring adjustments necessary for a fair presentation. Interim results of operations are not necessarily indicative of the results that may be achieved for a full year. The condensed consolidated financial statements and related notes do not include all information and notes required by GAAP for annual reports. These interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2024, included in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission (the “SEC”).

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company, and its wholly owned subsidiaries, joint ventures and subsidiaries in which we have a controlling interest. We also consolidate certain entities (“variable interest entities” or “VIEs”) when control of such entities can be achieved through means other than voting rights if the Company is deemed to be the primary beneficiary of such entities. All material intercompany transactions and balances are eliminated in consolidation.

Our consolidated total assets and liabilities includetwo consolidated ventures comprising our SHOP activities, each formed with a separate partner - Merrill Gardens, L.L.C. (“Merrill”) and DSHI NHI Holiday LLC (the “Discovery member”), a related party of Discovery Senior Living (“Discovery”). We consider both ventures to be VIEs as the members of each, as a group, lack the characteristics of a controlling financial interest. We are deemed to be the primary beneficiary of each VIE because we have the ability to control the activities that most significantly impact each VIE’s economic performance and the obligation to absorb losses or the right to receive benefits. Reference Notes 5 and 16 for further discussion of our SHOP ventures.

We also consolidatetwo real estate partner ships formed with our partners, Discovery Senior Housing Investor XXIV, LLC, a related party of Discovery, and LCS Timber Ridge LLC (“LCS”), to invest in senior housing facilities. We consider both partnerships to be VIEs, as either the members, as a group, lack the characteristics of a controlling financial interest or the total equity at risk is insufficient to finance activities without additional subordinated financial support. NHI directs the activities that most significantly impact economic performance of these partnerships and the obligation to absorb losses or the right to receive benefits, subject to limited protective rights extended to our partners for specified business decisions. Because of our control of these partnerships, we include their assets, liabilities, noncontrolling interests and operations in our condensed consolidated financial statements. Reference Note 16 for further discussion of these consolidated real estate partnerships.

We use the equity method of accounting when we own an interest in an entity over which we can exert significant influence but cannot control the entity’s operations. We discontinue equity method accounting if our investment in an entity (and net advances) is reduced to zero unless we have guaranteed obligations of the entity or are otherwise committed to provide further financial support for the entity. Reference Note 6 for further discussion of our equity method investment.

We have concluded that the Company is not the primary beneficiary for certain investments where we lack either directly or through related parties the power to direct the activities that most significantly impact their economic performance. See Note 16 for information on unconsolidated VIEs.

Noncontrolling Interests

Contingently redeemable noncontrolling interests are recorded at their initial carrying amounts upon issuance and are subsequently adjusted to reflect their share of gains or losses, contributions, and distributions attributable to the noncontrolling interests. In periods where they are or will become probable of redemption, an adjustment to the redemption value of the noncontrolling interests is also recognized through “Capital in excess of par value” on the Company’s Condensed Consolidated Balance Sheets and included in our computation of earnings per share. As of March 31, 2025 and December 31, 2024, the Merrill SHOP venture noncontrolling interest was classified in the Condensed Consolidated Balance Sheets as mezzanine equity, as discussed further in Note 10.

The noncontrolling interests associated with ourtwo consolidated real estate partnerships and our Discovery member SHOP venture were classified in the Condensed Consolidated Balance Sheets as equity as of March 31, 2025 and December 31, 2024.

Cash and Cash Equivalents and Restricted Cash

Cash equivalents consist of all highly liquid investments with original maturities of three months or less. Restricted cash includes amounts required to be held on deposit or subject to an agreement (e.g., with a qualified intermediary subject to an exchange agreement pursuant to Section 1031 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”) or in accordance with agency agreements governing our mortgages).

The following table sets forth our “Cash and cash equivalents and restricted cash” reported within the Company’s Condensed Consolidated Statements of Cash Flows ($ in thousands):

Concentration of Credit Risks

Our credit risks primarily relate to cash and cash equivalents and investments in mortgage and other notes receivable. Cash and cash equivalents are primarily held in bank accounts and overnight investments. We maintain our bank deposit accounts with large financial institutions in amounts that may exceed federally insured limits. We have not experienced any losses in such accounts. Our mortgage and other notes receivable consist primarily of secured loans on facilities.

Our financial instruments, principally our investments in mortgage and other notes receivable, are subject to the possibility of loss of the carrying values as a result of the failure of other parties to perform according to their contractual obligations which may make the instruments less valuable. We obtain collateral in the form of mortgage liens and other protective rights for mortgage and other notes receivable and continually monitor these rights in order to reduce such possibilities of loss. We evaluate the need to provide for reserves for potential losses on our financial instruments based on management’s periodic review of our portfolio on an instrument-by-instrument basis.

Impairment of Long-Lived Assets

We evaluate the recoverability of the carrying amount of our long-lived assets when events or circumstances, including significant physical changes, significant adverse changes in general economic conditions or significant deterioration of the underlying cash flows of the long-lived assets, indicate that the carrying amount of the long-lived assets may not be recoverable. The need to recognize an impairment charge is based on estimated undiscounted future cash flows compared to the carrying amount. If recognition of an impairment charge is necessary, it is measured as the amount by which the carrying amount of the property exceeds the estimated fair value of the long-lived asset.

Revenue Recognition

Rental Income - Our leases generally provide for rent escalators throughout the term of the lease. Base rental income is recognized using the straight-line method over the term of the lease to the extent that lease payments are considered collectable and the lease provides for specific contractual escalators. Under certain leases, we receive additional contingent rent, which is calculated on the increase in revenues of the tenant over a base year or base quarter. We recognize contingent rent annually or quarterly based on the actual revenues of the tenant once the target threshold has been achieved. Lease payments that depend on a factor directly related to future use of the property, such as an increase in annual revenues over a base year, are considered to be contingent rent and are excluded from the schedule of minimum lease payments.

The Company reviews its operating lease receivables for collectability on a regular basis, taking into consideration changes in factors such as the tenant’s payment history, the financial condition of the tenant, business conditions in which the tenant operates and economic conditions in the area where the property is located. In the event that collectability of substantially all lease payments with respect to any tenant is not probable, a direct write-off of the receivable is made as an adjustment to rental income and any future rental revenue is recognized only when the tenant makes a rental payment. Reference Note 3 for further discussion.

Resident Fees and Services - Resident fees and services revenue associated with our SHOP activities is recognized as the related performance obligations are satisfied and includes resident room charges, community fees and other resident charges.

Residency agreements are generally short-term (30 days toone year ), and entitle the resident to certain room and care services for a monthly fee billed in advance. Revenue for certain related services is billed monthly in arrears. The Company has elected the lessor practical expedient within Accounting Standards Codification (“ASC”) 842, Leases, not to separate the lease and nonlease components within our resident agreements as the timing and pattern of transfer to the resident are the same. The Company has determined that the nonlease component is the predominant component within the contract and recognizes revenue under ASC 606, Revenue Recognition from Contracts with Customers.

Interest Income from Mortgage and Other Notes Receivable

Interest income is recognized based on the interest rates and principal amounts outstanding on the notes receivable. We identify a mortgage note or other note receivable as non-performing, and is placed on non-accrual status, based on various criteria including timeliness of required payments, compliance with other provisions under the related note agreement, and an evaluation of the borrower’s current financial condition for indicators that it is probable it cannot pay its contractual amounts. A non-performing loan is returned to accrual status at such time as the note becomes contractually current and management believesall future principal and interest will be received according to the contractual terms of the note. As of March 31, 2025, we hadtwo mezzanine loans totaling an aggregate of $15.8 million designated as non-performing. Reference Note 4 for further discussion.

Income Taxes

We intend at all times to qualify as a REIT under Sections 856 through 860 of the Internal Revenue Code. Accordingly, we will generally not be subject to U.S. federal income tax, provided that we continue to qualify as a REIT. A failure to qualify under the applicable REIT qualification rules and regulations would have a material adverse impact on our financial position, results of operations and cash flows.

Certain activities that we undertake may be conducted by subsidiary entities that have elected to be treated as taxable REIT subsidiaries (“TRS”). TRSs are subject to federal, state, and local income taxes. Accordingly, a provision for income taxes has been made in the condensed consolidated financial statements.

Segments

We operate our business through two reportable segments: Real Estate Investments and SHOP. In our Real Estate Investments segment, we invest in (i) senior housing and healthcare real estate and lease those properties to healthcare operating companies under primarily triple-net leases that obligate tenants to pay all property-related expenses and (ii) mortgage and other notes receivable throughout the United States. Our SHOP segment is comprised of the operations of 15 ILFs located throughout the United States that are operated on behalf of the Company by independent managers pursuant to the terms of separate management agreements. Reference Notes 5 and 15 for additional information.

Forward Equity Sales

The Company has, and may continue to, enter into forward sale agreements relating to shares of its common stock, either through its at-the-market (“ATM “) equity program or through underwritten public offerings. These agreements may be physically settled in stock, settled in cash or net share settled at the Company’s election. The forward sale price that we will receive upon physical settlement of the forward sale agreements will be subject to adjustment for (i) a floating interest rate factor equal to a specified daily rate less a spread, and (ii) scheduled dividends during the term of the forward sale agreement. To the extent our forward sales agreements do not meet all the criteria to qualify for equity treatment under ASC 815-40, we recognize the change in the fair value of the derivative in our earnings. The Company evaluated its forward sale agreements and concluded they meet the conditions to be classified within stockholders’ equity as of March 31, 2025 and December 31, 2024.

Shares issuable under a forward equity sales agreement are reflected in the diluted earnings per share calculations for the applicable periods using the treasury stock method. Under this method, the number of our common shares used in calculating diluted earnings per share is deemed to be increased by the excess, if any, of the number of common shares that would be issued upon full physical settlement of the forward equity sales agreement over the number of common shares that could be purchased by us in the market (based on the average market price during the period) using the proceeds receivable upon full physical settlement (based on the average forward price during the reporting period).

Earnings Per Share

Our unvested restricted stock awards contain non-forfeitable rights to dividends, and accordingly, these awards are deemed to be participating securities. Therefore, the Company applies the two-class method to calculate basic and diluted earnings. Under the two-class method, we allocate net income attributable to stockholders to common stockholders and holders of unvested restricted stock by using the weighted-average shares of each class outstanding for quarter-to-date and year-to-date periods, based on their respective participation rights to dividends declared and undistributed earnings. Basic earnings per common share is computed by dividing net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share reflects the effect of dilutive securities.

Recent Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires public entities to disclose, on an annual and interim basis, disaggregated information in the footnotes about specified information related to certain costs and expenses. This guidance is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements and related disclosures.

Note 3. Investment Activity

Asset Acquisitions

During the three months ended March 31, 2025, we completed the following real estate acquisitions within our Real Estate Investments segment ($ in thousands):

1 This property was acquired in a deed in lieu of foreclosure transaction with Senior Living Management to satisfy the repayment of its $10.0 million mortgage note receivable. See “Cash Basis Tenants” below.

In January 2025, we acquired a 108-unit assisted living and memory care community in Montrose, Colorado. The acquisition price was $21.2 million, including $0.2 million in closing costs. The 10-year lease, which includestwo five-year extension options, has an initial lease rate of 8% with fixed annual escalators of 2%.

In March 2025, we acquired a 120-unit assisted living and memory care community in Bergen County, New Jersey. The acquisition price was $46.3 million, including $0.3 million in closing costs. The 15-year lease, which includestwo five-year extension options, has an initial lease rate of 7.95% with fixed annual escalators of 2%. The lease includes a $0.8 million capital improvement fund, which will be added to the respective lease base, if funded.

Second Quarter 2025 Acquisitions

In April 2025, we acquired a portfolio ofsix memory care communities located in Nebraska for a total purchase price of $63.5 million, including $0.3 million in closing costs. The 15-year master lease, which includestwo five-year extension options, has an initial lease rate of 8.0% with fixed annual escalators of 2%. A deposit of $7.0 million, which was included in “Other assets, net” on the Condensed Consolidated Balance Sheet as of March 31, 2025, was applied to the purchase price. Cash on hand as of March 31, 2025 was used to fund the remaining purchase price.

Impairments of Long-Lived Assets

We reduce the carrying value of impaired properties to their estimated fair value or, with respect to the properties classified as assets held for sale, to the estimated fair value less costs to sell. To estimate the fair values of the properties, we utilize a market approach which considers binding agreements for sales (Level 1 inputs), non-binding offers to purchase from unrelated third parties, broker quotes of estimated values (Level 3 inputs), and/or independent third-party valuations (Level 1 and 3 inputs). During the three months ended March 31, 2025 and 2024, we did not recognize any impairment charges.

We lease a SLC that is subject to an outstanding purchase and sale agreement for the tenant to acquire the property for approximately $38.5 million. The purchase and sale agreement, as amended, expires in June 2025. The property continues to be classified as held and used and is leased pursuant to the existing triple-net lease that generates approximately $2.8 million in annual rent and expires in July 2027. The property will be reclassified to assets held for sale when the sale becomes probable, including when the tenant demonstrates its ability to obtain sufficient financing to close on the sale of the property within the terms of the purchase and sale agreement. The property had a net investment of $18.9 million as of March 31, 2025.

Tenant Concentration

The following table contains information regarding concentration in our Real Estate Investments portfolio of tenants or affiliates of tenants that exceed 10% of total revenues as of and for the three months ended March 31, 2025 and 2024, excluding $2.6 million for our corporate office, a credit loss reserve of $18.9 million and $359.8 million in real estate assets in the SHOP segment ($ in thousands):

1 Includes interest income on notes receivable and rental income from properties classified as assets held for sale.

2 There is no tenant concentration in “Resident fees and services” because these agreements are with individual residents.

At March 31, 2025, the only state in which we had an investment concentration of 10% or more was South Carolina (11.3%).

As of March 31, 2025, we leasedten retirement communities to Senior Living. We recognized straight-line rents revenue of $(0.2) million and $(0.7) million from Senior Living for the three months ended March 31, 2025 and 2024, respectively.

NHC

As of March 31, 2025, we leased three ILFs and 32 SNFs to NHC, a publicly held company, under a master lease (four of which were subleased to other parties for whom the lease payments were guaranteed to us by NHC). Straight-line rents revenue of $0.2 million and $0.1 million was recognized from NHC for the three months ended March 31, 2025 and 2024, respectively.

NHC Percentage Rent -Under the terms of our master lease agreement with NHC, rent escalates by 4% of the increase, if any, in each of the facility’s revenue over a base year and is referred to as “percentage rent.”The following table summarizes the percentage rent income from NHC ($ in thousands):

1 For purposes of the percentage rent calculation described in the master lease agreement, NHC’s annual revenue by facility for a given year is certified to NHI by March 31 st of the following year.

One of the members of our Board of Directors is also a member of NHC’s board of directors.

Bickford

As of March 31, 2025, we leased 38 facilities to Bickford under master four leases. Bickford has been on the cash basis of revenue recognition since the second quarter of 2022 based upon information obtained from Bickford regarding its financial condition that has raised substantial doubt as to its ability to continue as a going concern. During the three months ended March 31, 2025 and 2024, Bickford repaid $1.3 million and $1.5 million, respectively, of its outstanding rent deferrals primarily related to the COVID-19 pandemic. As of March 31, 2025, Bickford’s outstanding rent deferrals totaled $11.7 million.

Cash Basis Tenants

We hadtwo tenants, including Bickford, on the cash basis of accounting for revenue recognition for their leasing arrangements based on our assessment of each tenant’s ability to satisfy its contractual obligations as of March 31, 2025. As of March 31, 2024, we hadthree tenants, including Bickford, on the cash basis of accounting for revenue recognition for their leasing arrangements. Cash rents received from these tenants for the three months ended March 31, 2025 and 2024 were as follows ($ in thousands):

Senior Living Management

Effective January 1, 2025, the remainingtwo properties leased to Senior Living Management (“SLM”) were transitioned to a new operator who had been serving as the interim manager of the properties. We executed a new 15-year triple-net master lease, which includestwo five-year extension options, with the new operator. The master lease generates approximately $1.1 million in annual rent with fixed annual escalators of 2%.

In February 2025, we acquired an assisted living facility in Oviedo, Florida through the completion of a deed in lieu of foreclosure to settle a $10.0 million non-performing mortgage note receivable. Reference Note 4 for further discussion of the non-performing notes receivable from SLM. We recorded the real estate assets acquired at their estimated fair values of $8.6 million. The net carrying value of the mortgage note receivable prior to completing the deed in lieu of foreclosure was $8.6 million. We executed a lease with a new operator who was serving as the interim manager. The lease generates approximately $0.7 million in annual rent.

Other Portfolio Activity

Discovery Senior Living

Effective May 1, 2025, we amended our triple-net master lease with Discovery Senior Living for a portfolio ofsix senior housing properties held in a consolidated real estate partnership with an aggregate net book value of $126.8 million as of March 31, 2025 that is owned by both parties to reset the contractual rent that took effect May 1, 2025 to $0.5 million per month. As part of the amendment, we obtained the right, but not the obligation, to pursue, negotiate, engage and otherwise enter into a new agreement with a new manager with respect to these leased properties. The straight-line rent receivable associated with the in-place lease is $9.3 million as of March 31, 2025. This receivable will be reduced to its realizable value when management determines the transition is probable of occurring and the existing lease will be terminated. Rental income recognized associated with this lease was $1.5 million for the three months ended March 31, 2025 and 2024.

Tenant Purchase Options

Certain of our leases contain purchase options allowing tenants to acquire the leased properties at a fixed base price plus a specified share in any appreciation, fixed base price, or a fixed minimum internal rate of return on our investment. At March 31, 2025, tenants had purchase options onfour properties with an aggregate net investment of $76.6 million that will become exercisable between 2028 and 2031. Rental income from these properties with tenant purchase options was $2.5 million and $1.8 million for the three months ended March 31, 2025 and 2024, respectively.

We cannot reasonably estimate at this time the probability that any purchase options will be exercised in the future. Consideration to be received from the exercise of any tenant purchase option is expected to exceed our net investment in the leased property or properties.

Future Minimum Base Rent

Future minimum lease payments to be received by us under our operating leases at March 31, 2025, were as follows ($ in thousands):

Variable Lease Payments

Most of our leases contain annual escalators in rent payments. Some of our leases contain escalators that are determined annually based on a variable index or other factors that are indeterminable at the inception of the lease. The table below indicates the rental income recognized as a result of fixed and variable lease escalators ($ in thousands):

Note 4. Mortgage and Other Notes Receivable

At March 31, 2025, our investments in mortgage notes receivable totaled $173.4 million secured by real estate and other assets of the borrowers (e.g., Uniform Commercial Code liens on personal property) related to 15 facilities, and our investments in other notes receivable totaled $105.3 million, substantially all of which were guaranteed by significant parties to the notes or by cross-collateralization of properties with the same owner. At December 31, 2024, our investments in mortgage notes receivable totaled $175.8 million and other notes receivable totaled $113.4 million. These balances exclude a credit loss reserve of $18.9 million and $20.2 million at March 31, 2025 and December 31, 2024, respectively.

As of March 31, 2025, we hadtwo other notes receivable designated as non-performing that consisted of a mezzanine loan of $14.5 million due from affiliates of SLM and an unsecured loan with Bickford of $1.3 million. As of December 31, 2024, we hadthree loans designated as non-performing including a mortgage note receivable of $10.0 million due from affiliates of SLM.

Interest income recognized, representing cash received, from these non-performing loans was $0.1 million and $0.5 million, respectively, for the three months ended March 31, 2025 and 2024. All other loans were on full accrual basis as of March 31, 2025. The credit loss reserve related to non-performing loans totaled $14.6 million and $16.1 million at March 31, 2025 and December 31, 2024, respectively.

SLM

In February 2025, we acquired an assisted living facility in Oviedo, Florida through the completion of a deed in lieu of foreclosure to settle a $10.0 million non-performing mortgage note receivable. We recorded the real estate assets acquired at their estimated fair values of $8.6 million which represents the net carrying value of the mortgage note receivable prior to completing the deed in lieu of foreclosure.

In May 2025, we received $2.5 million in partial repayment of the principal on the $14.5 million unsecured loan due from SLM that is classified as non-performing. This repayment will result in a reduction of the reserve on this loan and a reduction of the credit loss expense of approximately $1.3 million in the second quarter of 2025.

Vizion Health Loan Amendment

In March 2025, we amended a mezzanine loan agreement with affiliates of Vizion Health and funded an additional $5.3 million in the first quarter of 2025. The balance of the loan as of March 31, 2025 was $18.0 million. The amendment to the loan agreement provides for an interest rate of 9.15% and a maturity date in May 2028.

Montecito Medical Real Estate

We have a $50.0 million mezzanine loan and security agreement with Montecito Medical Real Estate for a fund that invests in medical real estate, including medical office buildings, throughout the United States. In the first quarter of 2025, approximately $6.2 million of principal was repaid upon the sale by the fund ofone of the underlying properties. As of March 31, 2025, $9.4 million was outstanding on the loan associated with five medical office buildings with a combined purchase price of approximately $56.7 million. For both the three months ended March 31, 2025 and 2024, we recognized interest income of $0.5 million.

Second Quarter 2025 Investments

In May 2025, we entered into an agreement to fund up to $28.0 million on a construction loan for the development of an 84-unit assisted living and memory care facility to be located in Wyoming, Michigan and operated by Encore Senior Living. The loan agreement provides for an annual interest rate of 9.0%.

Bickford Construction and Mortgage Loans

As of March 31, 2025, we hadone fully funded construction loan of $14.7 million to Bickford. The construction loan is secured by a first mortgage lien on substantially all of the related real and personal property as well as a pledge of any and all leases or agreements which may grant a right of use to the property. Usual and customary covenants extend to the agreement, including the borrower’s obligation for payment of insurance and taxes. NHI has a fair market value purchase option on the property upon stabilization of the underlying operations.

At March 31, 2025, we held a $12.1 million second mortgage as a component of the purchase price consideration in connection with the sale ofsix properties to Bickford in 2021. This second mortgage note receivable bears interest at a 10% annual rate and matures in April 2026. Interest income was $0.3 million for both the three months ended March 31, 2025 and 2024 related to the second mortgage. We did not include this note receivable in the determination of the gain recognized upon sale of the portfolio. Therefore, this note receivable is not reflected in “Mortgage and other notes receivable, net” in the Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024. During both the three months ended March 31, 2025 and 2024, Bickford repaid $0.1 million, of principal on this note receivable which is reflected in “Gains on sale of real estate, net” in the Condensed Consolidated Statements of Income.

We have provided a $15.0 million revolving line of credit to Senior Living whose borrowings under the revolver are to be used for working capital needs and to finance construction projects within its portfolio, including building additional units. The revolver matures in December 2031 at the time of the Senior Living lease maturity. At March 31, 2025, the revolver was fully funded and bore interest at 8.0% per annum.

The Company also has a mortgage loan of $32.7 million with Senior Living collateralized by a 248-unit continuing care retirement community (“CCRC”) in Columbia, South Carolina. The mortgage loan matures in July 2025, which may be extended forone-year, and bears interest at an annual rate of 7.25%. Additionally, the loan conveys to NHI a purchase option at a stated minimum price of $38.3 million, subject to adjustment for market conditions.

Credit Loss Reserve

Our principal measures of credit quality, except for construction mortgages, are debt service coverage for amortizing loans and interest or fixed charge coverage for non-amortizing loans, collectively referred to as “Coverage.” A Coverage ratio provides a measure of the borrower’s ability to make scheduled principal and interest payments. The Coverage ratios presented in the table below have been calculated utilizing the most recent date for which data is available, December 31, 2024, using EBITDARM (earnings before interest, taxes, depreciation, amortization, rent and management fees) and the requisite debt service, interest service or fixed charges, as defined in the applicable loan agreement. We categorize Coverage into three levels: (i) more than 1.5x, (ii) between 1.0x and 1.5x, and (iii) less than 1.0x. We update the calculation of Coverage on a quarterly basis. Coverage is not a meaningful credit quality indicator for construction mortgages as either these developments are not generating any operating income, or they have insufficient operating income as occupancy levels necessary to stabilize the properties have not yet been achieved. We measure credit quality for these mortgages by considering the construction and stabilization timeline and the financial condition of the borrower, as well as economic and market conditions.

We consider the guidance in ASC 310-20, Receivables - Nonrefundable Fees and Other Costs, when determining whether a modification, extension or renewal constitutes a current period origination. The credit quality indicator as of March 31, 2025 is presented below for the amortized cost, net by year of origination ($ in thousands):

Due to the continuing challenges in financial markets and the potential impact on the collectability of our mortgages and other notes receivable, we forecasted a 20% increase in the probability of a default and a 20% increase in the amount of loss from a default on all loans, other than those designated as non-performing, resulting in an effective adjustment of 40%. The methodology for estimating the reserves for non-performing loans incorporates the sufficiency of the underlying collateral and the current conditions and forecasts of future economic conditions of these loans, including qualitative factors, which may differ from conditions existing in the historical periods.

The allowance for expected credit losses is presented in the following table for the three months ended March 31, 2025 ($ in thousands):

Note 5. Senior Housing Operating Portfolio Structure

Our SHOP segment is comprised oftwo ventures that collectively own the operations of 15 ILFs. These ventures are structured to comply with REIT requirements and utilize the TRS for activities that would otherwise be non-qualifying for REIT purposes. The properties in each venture are operated by a property manager in exchange for a management fee. The ventures were capitalized with preferred and common equity interests, with the Company owning 100% of the preferred equity and a controlling common equity interest in each venture. The managers, or related parties of the managers, own a non-controlling common equity interest in their respective ventures. Each venture is discussed in more detail below.

Merrill Managed Portfolio

We havesix ILFs located in California and Washington in a consolidated venture with Merrill, which owns a 20% common equity interest in the venture. The operating agreement for the venture provides for contingent distributions to the members based on the attainment of certain yields on investment calculated on an annual basis.

The properties are managed by Merrill pursuant to a management agreement with an initial term through March 2032 that automatically renews on a year-to-year basis thereafter unless terminated by either party with notice. The management agreement entitles Merrill to a base management fee of 5% of net revenue and a real estate services fee of 5% of real estate costs incurred during any calendar year that exceed $1,000 times the number of units at each facility. The noncontrolling interest associated with the venture was determined to be contingently redeemable and is classified in mezzanine equity on the Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024, as discussed further in Note 10.

Discovery Managed Portfolio

We have nine ILFs located in Arkansas, Georgia, Ohio, Oklahoma, New Jersey, and South Carolina in a consolidated venture with the Discovery member, which owns a 2.0% common equity interest in the venture. The operating agreement for the venture provides for contingent distributions to the members based on the attainment of certain yields on investment calculated on an annual basis. The noncontrolling interest associated with the venture is included in “Equity” on the Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024.

The properties are managed by separate related parties of Discovery pursuant to management agreements, each with an initial term through March 2032 that automatically renews on a year-to-year basis thereafter unless terminated by either party with notice. The management agreements entitle the managers to a base management fee of 5% of net revenue.

Note 6. Equity Method Investment

Concurrently with the acquisition of a CCRC from LCS-Westminster Partnership III, LLP in January 2020, we invested $0.9 million in the operating company, Timber Ridge OpCo, LLC (“Timber Ridge OpCo”), representing a 25.0% equity interest. This investment is held by our TRS to be compliant with the provisions of the REIT Investment Diversification and Empowerment Act (“RIDEA”) of 2007. As part of our investment, we provided Timber Ridge OpCo a revolving credit facility of up to $5.0 million of whichno funds have been drawn.

We account for our investment in Timber Ridge OpCo under the equity method and decrease the carrying value of our investment for losses in the entity and distributions to NHI for cumulative amounts up to and including our basis plus any guaranteed or implied commitments to fund operations. Our guaranteed and implied commitments are currently limited to the additional $5.0 million under the revolving credit facility and the $2.5 million lease incentive distribution received in February 2023. As of March 31, 2025, we have recognized our share of Timber Ridge OpCo’s operating losses in excess of our initial investment. These cumulative losses of $5.0 million in excess of our original basis and the $2.5 million lease incentive distribution received are included in “Accounts payable and accrued expenses” in our Condensed Consolidated Balance Sheet as of March 31, 2025 and December 31, 2024. Excess unrecognized equity method losses for this investment for both the three months ended March 31, 2025 and 2024 were $0.6 million. Cumulative unrecognized losses for this investment were $13.3 million through March 31, 2025. We recognized gains of approximately $0.4 million and $0.2 million, representing cash distributions received related to our investment for the three months ended March 31, 2025 and 2024, respectively.

The Timber Ridge OpCo property is subject to early resident mortgages secured by a Deed of Trust and Indenture of Trust (the “Deed and Indenture”). As part of our acquisition, NHI-LCS JV I, LLC (“Timber Ridge PropCo”) acquired the Timber Ridge CCRC property and a subordination agreement was entered into pursuant to which the trustee acknowledged and confirmed that the security interests created under the Deed and Indenture were subordinate to any security interests granted in connection with the $81.0 million loan made by NHI to Timber Ridge PropCo, which is eliminated upon consolidation. In addition, under the terms of the resident loan assumption agreements, during the term of the lease (seven years withtwo five-year renewal options), Timber Ridge OpCo is to indemnify Timber Ridge PropCo for any repayment by Timber Ridge PropCo of these early resident mortgage liabilities under the guarantee. As a result of the subordination agreement and the resident loan assumption agreements, no liability has been recorded as of March 31, 2025 and December 31, 2024. The balance secured by the Deed and Indenture was $9.6 million at March 31, 2025.

Note 7. Other Assets

Other assets, net consist of the following ($ in thousands):

In the first quarter of 2025, we expensed approximately $1.2 million in costs incurred related to a large SHOP transaction that is no longer probable of occurring, of which approximately $0.6 million was included in other assets as of December 31, 2024.

Note 8. Debt

Debt consisted of the following ($ in thousands):

Aggregate principal maturities of debt as of March 31, 2025 were as follows ($ in thousands):

Unsecured revolving credit facility and bank term loan

We have a $700.0 million unsecured revolving credit facility (the “Credit Facility”), which was amended and restated on October 24, 2024 to extend the maturity date from March 2026 to October 2028, which may be further extended by us pursuant to (i) one or both of thetwo six-month extension options or (ii)one twelve-month extension option. Borrowings under the Credit Facility bear interest, at our election, at one of the following (a) Term Secured Overnight Financing Rate (“SOFR”) (plus a credit spread adjustment) plus a margin ranging from 0.725% to 1.40%, (b) Daily SOFR (plus a credit spread adjustment) plus a margin ranging from 0.725% to 1.40% or (c) the base rate plus a margin ranging from 0.00% to 0.40%. In each election, the actual margin is determined according to our credit ratings. The base rate means, for any day, a fluctuating rate per annum equal to the highest of (x) the agent’s prime rate, (y) the federal funds rate on such day plus 0.50% or (z) the adjusted Term SOFR for a one-month tenor in effect on such day plus 1.0%. In addition, the Credit Facility requires a facility fee equal to 0.125% to 0.30%, based on our credit rating on the $700.0 million committed capacity, without regard to usage.

At March 31, 2025, we had $252.8 million available to draw on the Credit Facility, subject to usual and customary covenants. Among other stipulations, the unsecured credit facility agreement requires that we maintain certain financial ratios within limits set by our creditors. At March 31, 2025, we were in compliance with these ratios.

We have a $200.0 million term loan (the “2025 Term Loan”) that bears interest at a variable rate which is SOFR-based with a margin determined according to our credit ratings plus a 0.10% credit spread adjustment. On April 3, 2025, we exercised one of ourtwo six-month options to extend the maturity date from June 2025 to December 2025.

Concurrently with the amendment and restatement of the Credit Facility, we amended the 2025 Term Loan to, among other things, modify the representations, covenants, financial covenants, and events of default to align with the same provisions in the Credit Facility.

Pinnacle Bank is a participating member of our banking group. A member of NHI’s Board of Directors, who became chair of the Board of Directors effective January 7, 2025, is also the chair of Pinnacle Financial Partners, Inc., the holding company for Pinnacle Bank. NHI’s local banking transactions are conducted primarily through Pinnacle Bank.

2031 Senior Notes

In January 2021, we issued $400.0 million in aggregate principal amount of 3.00% senior notes that mature on February 1, 2031 and pay interest semi-annually (the “2031 Senior Notes”). The 2031 Senior Notes were sold at an issue price of 99.196% of face value before the underwriters’ discount. The 2031 Senior Notes are subject to affirmative and negative covenants, including financial covenants with which we were in compliance at March 31, 2025.

Private Placement Notes

Our unsecured private placement notes outstanding as of March 31, 2025, payable interest only, are summarized below ($ in thousands):

Covenants pertaining to the unsecured private placement notes are generally conformed with those governing our Credit Facility, except for specific debt-coverage ratios that are more restrictive. Our unsecured private placement notes include a rate increase provision that is effective if any rating agency lowers our credit rating on our senior unsecured debt below investment grade and our compliance leverage increases to 50% or more.

Fannie Mae Term Loans

As of March 31, 2025, we had $60.1 million in Fannie Mae term-debt mortgage financing requiring interest-only payments at an annual rate of 3.79% with a 10-year maturity. The mortgages were non-recourse and secured by 11 properties leased to

Bickford. This indebtedness matured on April 1, 2025, at which time we repaid all outstanding principal and accrued interest of $60.3 million from proceeds drawn on our Credit Facility on March 31, 2025.

In a December 2017 acquisition, we assumed additional Fannie Mae term-debt mortgage financing that amortizes through 2025 when a balloon payment will be due, bears interest at a rate of 4.6%, and has a remaining balance of $15.6 million at March 31, 2025. Collectively, the Fannie Mae term-debt mortgage financing is secured by properties having a net book value of $97.4 million at March 31, 2025.

Interest Expense

The following table summarizes interest expense ($in thousands):

Note 9. Commitments, Contingencies and Uncertainties

In the normal course of business, we enter into a variety of commitments, typically consisting of funding revolving credit arrangements, construction and mezzanine loans to our operators to conduct expansions and acquisitions for their own account, and commitments for the funding of construction for expansion or renovation to our existing properties under lease. In our leasing operations, we offer to our tenants and to sellers of newly acquired properties a variety of inducements that originate contractually as contingencies but which may become commitments upon the satisfaction of the contingent event. Contingent payments earned are included in the respective lease bases when funded.

As of March 31, 2025, we had working capital, mortgage, construction, revolving credit and mezzanine loan commitments toeight operators or borrowers for an aggregate of $151.3 million, of which we had funded $100.7 million toward these commitments. Loan funded amounts do not reflect the effects of discounts or commitment fees.

As of March 31, 2025, we had $23.4 million of development commitments for renovation ofsix properties, of which we had funded $5.9 million toward these commitments.

As of March 31, 2025, we had an aggregate of $16.9 million in remaining contingent lease inducement commitments infour lease agreements which are generally based on the performance of facility operations and may or may not be met by the tenant.

The credit loss liability for unfunded loan commitments is estimated using the same methodology as used for our funded mortgage and other notes receivable based on the estimated amount that we expect to fund. We applied the same market adjustments as discussed in Note 4.

The liability for expected credit losses on our unfunded loan commitments reflected in “Accounts payable and accrued expenses” on the Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024 is presented in the following table for the three months ended March 31, 2025 ($ in thousands):

Litigation

Our facilities are subject to claims and suits in the ordinary course of business. Such claims may include, among other things, professional liability and general liability claims, as well as regulatory proceedings related to our SHOP segment. Our managers, tenants and borrowers have indemnified, and are obligated to continue to indemnify, us against all liabilities arising from the operation of the facilities, and are further obligated to indemnify us against environmental or title problems affecting the real estate underlying such facilities. While there may be lawsuits pending against us and certain of the owners and/or lessees of the facilities, management believes that the ultimate resolution of all such pending proceedings will have no material adverse effect on our financial condition, results of operations or cash flows.

Note 10. Redeemable Noncontrolling Interest

The interest held by Merrill in its SHOP venture was classified as a “Redeemable noncontrolling interest” in the mezzanine section between “Total liabilities”and “Stockholders’ equity” on our Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024. Certain provisions within the operating agreement of the Merrill venture provide Merrill with put rights upon certain contingent events that are not solely within the control of the Company. Therefore, Merrill’s noncontrolling interest was determined to be contingently redeemable. The redeemable noncontrolling interest is not currently redeemable and we concluded a contingent redemption event is not probable to occur as of March 31, 2025. Consequently, the noncontrolling interest will not be subsequently remeasured to its redemption amount until such contingent event and the related redemption are probable to occur. We will continue to reflect the attribution of gains or losses to the redeemable noncontrolling interest in each period.

The following table presents the change in “Redeemable noncontrolling interest” for the three months ended March 31, 2025 ($ in thousands):

Note 11. Equity and Dividends

Forward Sale Agreements

In the first quarter of 2025, we settled the remaining approximately 1.0 million shares of common stock subject to our August 2024 forward equity sale agreement at a forward price of $68.21 per share resulting in proceeds of approximately $65.5 million.

ATM Equity Program

We maintain an ATM equity program which allows us to sell our common stock directly into the market and have entered into an ATM equity offering sales agreement pursuant to which the Company may sell, from time to time, up to an aggregate sales price of $500.0 million of the Company’s common stock. The ATM equity program has a forward sale provision which allows us to sell shares of common stock to forward purchasers at a predetermined price at a future date.

During the three months ended March 31, 2025, we entered into ATM forward sale agreements with a financial institution to sell shares of common stock which mature in the first quarter of 2026. We sold approximately 0.2 million shares on a forward basis at a weighted average price of $74.39 per share net of sales agent fees, or approximately $15.5 million. We did not receive any proceeds from the sale of shares of our common stock by the forward purchasers at the time of the sale.

As of March 31, 2025, the remaining approximately 0.7 million shares of common stock under our December 2024 ATM forward sale agreement were available for settlement at a forward price of $74.12 per share for proceeds of approximately $53.6 million. This forward sale agreement matures in the fourth quarter of 2025.

No shares were sold under the ATM equity program during the three months ended March 31, 2024.

Dividends

The following table summarizes dividends declared by the Board of Directors or paid during the three months ended March 31, 2025 and 2024:

On May 2, 2025, the Board of Directors declared a $0.90 per share dividend payable on August 1, 2025 to common stockholders of record as of June 30, 2025.

Note 12. Share-Based Compensation

The Company’s outstanding stock incentive awards have been granted undertwo incentive plans – the 2012 Stock Incentive Plan and the 2019 Stock Incentive Plan, as amended and restated (the “2019 Plan”). During the three months ended March 31, 2025, we granted options to purchase 557,000 shares of common stock under the 2019 Plan.

In February 2025,29,500 shares of restricted stock were issued to executive officers with a grant date fair value of $73.34 per share based on the market value of our common stock on the date of grant. The restricted stock vests over five years, with 20% vesting on each anniversary of the date of grant and beginning with 2025, are subject to a one-year post-vesting hold. The restricted stock awards contain non-forfeitable rights to dividends or dividend equivalents during the vesting periods. During the first quarter of 2025,3,000 shares of restricted stock vested. As of March 31, 2025, there were 58,300 non-vested shares of restricted stock outstanding.

The weighted average fair value of options granted during the three months ended March 31, 2025 and 2024 was $9.35 and $7.36 per option, respectively. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions:

The following table summarizes our outstanding stock options:

At March 31, 2025, the intrinsic value of stock options outstanding and exercisable was $10.9 million and $8.9 million, respectively.

The following is a summary of share-based compensation expense, net of any forfeitures, included in “General and administrative expenses” in the Condensed Consolidated Statements of Income ($ in thousands):

As of March 31, 2025, unrecognized compensation expense totaling $6.3 million associated with stock-based awards was expected to be recognized over the following periods: remainder of 2025 - $3.2 million, 2026 - $2.0 million, 2027 - $0.7 million, 2028 - $0.3 million, and thereafter - less than $0.1 million.

Note 13. Earnings Per Common Share

The following table summarizes the average number of common shares and the net income used in the calculation of basic and diluted earnings per common share($ in thousands, except share and per share amounts):

Note 14. Fair Value of Financial Instruments

Carrying amounts and fair values of financial instruments that are not carried at fair value at March 31, 2025 and December 31, 2024 in the Condensed Consolidated Balance Sheets are as follows ($in thousands):

Fixed rate debt. Fixed rate debt is classified as Level 2 and its fair value is based on quoted prices for similar instruments or calculated utilizing model derived valuations in which significant inputs are observable in active markets.

Variable rate debt. Variable rate debt is classified as Level 2 and the fair values of our borrowings under our Credit Facility and 2025 Term Loan are reasonably estimated at their notional amounts due to the predominance of floating interest rates, which generally reflect market conditions.

Mortgage and other notes receivable. The fair value of mortgage and other notes receivable is based on credit risk and discount rates that are not observable in the marketplace and therefore represents a Level 3 measurement.

Carrying amounts of cash and cash equivalents and restricted cash, accounts receivable and accounts payable and accrued expenses approximate fair value due to their short-term nature and are classified as Level 1.

Note 15. Segment Reporting

We evaluate our business and make resource allocations on ourtwo operating segments: Real Estate Investments and SHOP. Our Real Estate Investments segment includes leases, mortgages and other note investments in ILFs, ALFs, EFCs, SLCs, SNFs and HOSPs. Under the Real Estate Investments segment, we invest in senior housing and healthcare real estate through acquisition and financing of primarily single-tenant properties. Properties acquired are leased primarily under triple-net leases and we are not involved in the management of the properties. The SHOP segment includes multi-tenant ILFs. The SHOP properties and related operations are controlled by the Company and are operated by property managers in exchange for a management fee. See Note 5 for further discussion.

Our President and Chief Executive Officer serves as our Chief Operating Decision Maker (“CODM”). Our CODM reviews financial and performance information quarterly based upon segment net operating income (“NOI”). We define NOI as total revenues, less tenant reimbursements and property operating expenses. Our CODM evaluates NOI to make decisions about resource allocations and to assess the property level performance of our properties. For both segments, the CODM considers revenue and operating expenses on a comparative basis (i.e., sequential or year over year) and compares budget to actual variances on a quarterly basis when making decisions regarding allocations of resources to the segments. In addition, for the SHOP segment, the CODM reviews key performance indicators, including revenues and operating expenses per occupied unit or available unit and resident revenues and related functional expenses. There were no intersegment transactions for either the three months ended March 31, 2025 or 2024. Capital expenditures for the three months ended March 31, 2025 were approximately $83.7 million for the Real Estate Investments segment and $1.4 million for the SHOP segment. Capital expenditures for the three months ended March 31, 2024 were approximately $1.7 million for the Real Estate Investments segment and $1.3 million for the SHOP segment.

Non-segment revenue consists mainly of other income. Non-segment assets consist of corporate assets including cash and cash equivalents and corporate offices and equipment, among others. Non-property specific revenues and expenses are not allocated to individual segments in determining NOI.

The accounting policies of the segments are the same as those described in the significant accounting policies in Note 2. The results of operations for all acquisitions described in Note 3 are included in our consolidated results of operations from the acquisition dates and are components of the appropriate segments. Prior period segment disclosures have been recast to conform to the current period presentation.

Summary information for the reportable segments during the three months ended March 31, 2025 and 2024 is as follows ($ in thousands):

Note 16. Variable Interest Entities

Consolidated Variable Interest Entities

SHOP - The assets of the SHOP ventures primarily consist of real estate properties, cash and cash equivalents, and resident fees and services (accounts receivable). The obligations of the ventures primarily consist of operating expenses of the ILFs (accounts payable and accrued expenses) and capital expenditures for the properties. Aggregate assets of the consolidated SHOP ventures that can be used only to settle obligations of each respective SHOP venture primarily include approximately $260.2 million and $261.6 million of real estate properties, net, $3.1 million and $6.5 million of cash and cash equivalents, and $1.2 million and $1.5 million of other assets, net, and $0.8 million and $0.8 million of accounts receivable as of March 31, 2025 and December 31, 2024, respectively. Liabilities of the consolidated SHOP ventures for which creditors do not have recourse to the general credit of the Company are $3.4 million and $5.7 million as of March 31, 2025 and December 31, 2024, respectively. Reference Notes 5 and 10 for further discussion of these ventures.

Real Estate Partnerships - The aggregate assets of thetwo consolidated real estate partnerships that can be used only to settle obligations of each respective partnership as of March 31, 2025 and December 31, 2024 include approximately $242.3 million and $244.3 million of real estate properties, net, $10.1 million and $10.0 million in straight-line rents receivable, $2.7 million and $3.2 million of cash and cash equivalents and $4.7 million and $5.3 million of other assets, net, respectively. Liabilities of these partnerships for which creditors do not have recourse to the general credit of the Company are not material.

Unconsolidated Variable Interest Entities

The Company’s unconsolidated VIEs are summarized below by date of initial involvement. For further discussion of the nature of the relationships, including the sources of exposure to these VIEs, see the notes to our condensed consolidated financial statements cross-referenced below ($ in thousands).

*Formerly referred to as Watermark Retirement

1 Note, straight-line rents receivable, and lease receivables

2 Loan commitment, equity method investment, straight-line rents receivable and unamortized lease incentive

3 Straight-line rents receivable, and unamortized lease incentive

4 Representstwo mezzanine loans originated from the sales of real estate

We are not obligated to provide support beyond our stated commitments to these tenants and borrowers whom we classify as VIEs, and accordingly, our maximum exposure to loss as a result of these relationships is limited to the amount of our commitments, as shown above and discussed in the notes. Economic loss on a lease, in excess of what is presented in the table above, if any, would be limited to that resulting from any period of non-payment of rent before we are able to take effective remedial action, as well as costs incurred in transitioning the lease to a new tenant. The potential extent of such loss would be dependent upon individual facts and circumstances, and is therefore not included in the table above.

In the future, NHI may be deemed the primary beneficiary of the operations if the tenants or borrowers do not have adequate liquidity to accept the risks and rewards as the tenants and operators of the properties and NHI may be required to consolidate the financial position and results of operations of the tenants or borrowers into our condensed consolidated financial statements.