American Healthcare REIT, Inc.

Previous wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to promote understanding of our results of operations and financial condition. Such discussion is provided as a supplement to, and should be read in conjunction with our accompanying condensed consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q and in our 2024 Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission, or SEC, on February 28, 2025. Such condensed consolidated financial statements and information have been prepared to reflect our financial position as of June 30, 2025 and December 31, 2024, together with our results of operations for the three and six months ended June 30, 2025 and 2024 and cash flows for the six months ended June 30, 2025 and 2024. Our results of operations and financial condition, as reflected in the accompanying condensed consolidated financial statements and related notes, are subject to management’s evaluation and interpretation of business conditions, changing capital market conditions, and other factors that could affect the ongoing operations and occupancy of our tenants and residents.

Current wording

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to promote understanding of our results of operations and financial condition. Such discussion is provided as a supplement to, and should be read in conjunction with our accompanying condensed consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q and in our 2024 Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission, or SEC, on February 28, 2025. Such condensed consolidated financial statements and information have been prepared to reflect our financial position as of September 30, 2025 and December 31, 2024, together with our results of operations for the three and nine months ended September 30, 2025 and 2024 and cash flows for the nine months ended September 30, 2025 and 2024. Our results of operations and financial condition, as reflected in the accompanying condensed consolidated financial statements and related notes, are subject to management’s evaluation and interpretation of business conditions, changing capital market conditions, and other factors that could affect the ongoing operations and occupancy of our tenants and residents.

Previous wording

We currently operate through four reportable business segments: ISHC, OM, SHOP and triple-net leased properties. As of June 30, 2025, we owned and/or operated 309 buildings and ISHC, representing approximately 19,228,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $4,513,420,000. In addition, as of June 30, 2025, we also owned a real estate-related debt investment purchased for $60,429,000.

Current wording

We currently operate through four reportable business segments: ISHC, OM, SHOP and triple-net leased properties. As of September 30, 2025, we owned and/or operated 315 buildings and ISHC, representing approximately 20,132,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $4,778,477,000. In addition, as of September 30, 2025, we also owned a real estate-related debt investment purchased for $60,429,000.

Previous wording

During the six months ended June 30, 2025 and 2024, inflation has affected our operations. The annual rate of inflation in the United States was 2.7% in June 2025 and 3.0% in June 2024, as measured by the Consumer Price Index. We believe inflation has impacted our operations such that we have experienced, and continue to experience, increases in the cost of labor, services, energy and supplies, and therefore continued inflationary pressures on our ISHC and SHOP could continue to impact our profitability in future periods. To offset the impact of inflation on the cost of labor and services, we had our RIDEA managers bill higher than average annual rent and care fee increases for existing residents in 2024 and 2025, as compared to prior years, while adjusting market rates as frequently as needed based on competitor pricing and market conditions. We believe this practice will improve operating performance in our ISHC and SHOP, as well as increase rent coverage and the stability of our real estate revenue in our triple-net leased properties over time.

Current wording

During the nine months ended September 30, 2025 and 2024, inflation has affected our operations. The annual rate of inflation in the United States was 3.0% in September 2025 and 2.4% in September 2024, as measured by the Consumer Price Index. We believe inflation has impacted our operations such that we have experienced, and continue to experience, increases in the cost of labor, services, energy and supplies, and therefore continued inflationary pressures on our ISHC and SHOP could continue to impact our profitability in future periods. To offset the impact of inflation on the cost of labor and services, we had our RIDEA managers bill higher than average annual rent and care fee increases for existing residents in 2024 and 2025, as compared to prior years, while adjusting market rates as frequently as needed based on competitor pricing and market conditions. We believe this practice will improve operating performance in our ISHC and SHOP, as well as increase rent coverage and the stability of our real estate revenue in our triple-net leased properties over time.

Previous wording

Excluding our ISHC and SHOP, as of June 30, 2025, our properties were 89.0% leased, and, during the remainder of 2025, 5.6% of the leased GLA is scheduled to expire. Our leasing strategy focuses on negotiating renewals for leases scheduled to expire during the next 12 months. In the future, if we are unable to negotiate renewals, we will try to identify new tenants or collaborate with existing tenants who are seeking additional space to occupy. As of June 30, 2025, our remaining weighted average lease term was 6.8 years, excluding our ISHC and SHOP.

Current wording

Excluding our ISHC and SHOP, as of September 30, 2025, our properties were 89.3% leased, and, during the remainder of 2025, 4.0% of the leased GLA is scheduled to expire. Our leasing strategy focuses on negotiating renewals for leases scheduled to expire during the next 12 months. In the future, if we are unable to negotiate renewals, we will try to identify new tenants or collaborate with existing tenants who are seeking additional space to occupy. As of September 30, 2025, our remaining weighted average lease term was 6.8 years, excluding our ISHC and SHOP.

Previous wording

Our combined ISHC and SHOP were 88.7% leased as of June 30, 2025. Substantially all of our leases with residents at such properties are for a term of one year or less.

Current wording

Our combined ISHC and SHOP were 89.7% leased as of September 30, 2025. Substantially all of our leases with residents at such properties are for a term of one year or less.

Previous wording

Comparison of Three and Six Months Ended June 30, 2025 and 2024

Current wording

Comparison of Three and Nine Months Ended September 30, 2025 and 2024

Previous wording

The most significant drivers behind changes in our consolidated results of operations for the three and six months ended June 30, 2025 compared to the corresponding periods in 2024 were primarily due to: our increase in resident occupancies and billing rates; the adverse impact of inflation, which resulted in increases in the cost of labor, services, energy and supplies; and our acquisitions and dispositions of investments. Additional information behind the changes in our consolidated results of operations is discussed in more detail below. See Note 3, Real Estate Investments, to our accompanying condensed consolidated financial statements for a further discussion of our acquisitions and dispositions during 2025. As of June 30, 2025 and 2024, we owned and/or operated the following types of properties (dollars in thousands):

Current wording

The most significant drivers behind changes in our consolidated results of operations for the three and nine months ended September 30, 2025 compared to the corresponding periods in 2024 were primarily due to: our increase in resident occupancies and billing rates; the adverse impact of inflation, which resulted in increases in the cost of labor, services, energy and supplies; and our acquisitions and dispositions of investments. Additional information behind the changes in our consolidated results of operations is discussed in more detail below. See Note 3, Real Estate Investments, to our accompanying condensed consolidated financial statements for a further discussion of our acquisitions and dispositions during 2025. As of September 30, 2025 and 2024, we owned and/or operated the following types of properties (dollars in thousands):

Previous wording

(1)Leased percentage includes all third-party leased space at our non-RIDEA properties (including master leases), except for our ISHC and SHOP where leased percentage represents resident occupancy of the available units/beds therein.

Current wording

Leased percentage includes all third-party leased space at our non-RIDEA properties (including master leases), except for our ISHC and SHOP where leased percentage represents resident occupancy of the available units/beds therein.

Previous wording

(2)Weighted average leased percentage excludes our ISHC and SHOP.

Current wording

Weighted average leased percentage excludes our ISHC and SHOP.

Previous wording

Our primary sources of revenue include resident fees and services revenue generated by our RIDEA properties and rent from our leased, non-RIDEA properties. For the three and six months ended June 30, 2025 and 2024, resident fees and services revenue primarily consisted of rental fees related to resident leases, extended health care fees and other ancillary services, and real estate revenue primarily consisted of base rent and expense recoveries. The amount of revenues generated by our RIDEA properties depends principally on our ability to maintain resident occupancy rates. The amount of revenues generated by our non-RIDEA properties is dependent on our ability to maintain tenant occupancy rates of currently leased space and to lease available space at the then existing rental rates. Revenues by reportable segment consisted of the following for the periods presented below (in thousands):

Current wording

Our primary sources of revenue include resident fees and services revenue generated by our RIDEA properties and rent from our leased, non-RIDEA properties. For the three and nine months ended September 30, 2025 and 2024, resident fees and services revenue primarily consisted of rental fees related to resident leases, extended health care fees and other ancillary services, and real estate revenue primarily consisted of base rent and expense recoveries. The amount of revenues generated by our RIDEA properties depends principally on our ability to maintain resident occupancy rates. The amount of revenues generated by our non-RIDEA properties is dependent on our ability to maintain tenant occupancy rates of currently leased space and to lease available space at the then existing rental rates. Revenues by reportable segment consisted of the following for the periods presented below (in thousands):

Previous wording

For our ISHC segment, we increased resident fees and services revenue by $30,051,000 and $60,293,000, respectively, for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, primarily due to increased resident occupancy and higher resident fees as a result of an increase in billing rates and levels of care service.

Current wording

For our ISHC segment, we increased resident fees and services revenue by $40,093,000 and $100,386,000, respectively, for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, primarily due to: (i) increased resident occupancy and higher resident fees as a result of an increase in billing rates and levels of care service; (ii) an increase of $12,462,000 due to the acquisition in July 2025 of five senior housing properties included in our ISHC segment and located in Ohio and Michigan; and (iii) an increase of $4,277,000 due to the acquisition in July 2025 of four senior housing properties included in our ISHC segment and located in Kentucky.

Previous wording

For our SHOP segment, resident fees and services revenue increased $13,221,000 and $28,037,000, respectively, for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, primarily due to: (i) an increase of $4,933,000 and $9,703,000, respectively, due to the acquisition of five senior housing properties in Washington in September 2024; (ii) an increase of $2,640,000 due to the acquisition of one senior housing property in Virginia in April 2025; (iii) an increase of $946,000 and $1,989,000, respectively, due to the acquisition of one senior housing property in Georgia in October 2024; and (iv) an increase of $3,503,000 and $7,297,000, respectively, due to increased resident occupancy and higher resident fees as a result of an increase in billing rates. In addition, SHOP revenue increased by $4,836,000 for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, due to the acquisition of 14 senior housing properties in Oregon in February 2024.

Current wording

For our SHOP segment, resident fees and services revenue increased $15,131,000 and $43,168,000, respectively, for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, primarily due to: (i) an increase of $3,554,000 and $13,257,000, respectively, due to the acquisition of five senior housing properties in Washington in September 2024; (ii) an increase of $3,099,000 and $5,739,000, respectively, due to the acquisition of one senior housing property in Virginia in April 2025; (iii) an increase of $2,812,000 due to the acquisition of three senior housing properties in Minnesota and Idaho in the third quarter 2025; (iv) an increase of $885,000 and $2,874,000, respectively, due to the acquisition of one senior housing property in Georgia in October 2024; and (v) an increase of $3,474,000 and $10,683,000, respectively, due to increased resident occupancy and higher resident fees as a result of an increase in billing rates. In addition, SHOP revenue increased by $5,199,000 for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, due to the acquisition of 14 senior housing properties in Oregon in February 2024.

Previous wording

For our triple-net leased properties segment, real estate revenue decreased $2,922,000 and $6,037,000, respectively, for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, primarily due to the disposition of eight triple-net leased properties in Missouri in December 2024.

Current wording

For our triple-net leased properties segment, real estate revenue decreased $3,567,000 and $9,604,000, respectively, for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, primarily due to the disposition of eight triple-net leased properties in Missouri in December 2024.

Previous wording

Real estate revenue for our OM segment decreased $2,428,000 and $3,301,000, respectively, for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, primarily due to dispositions of OM buildings in 2024 and 2025.

Current wording

Real estate revenue for our OM segment decreased $2,534,000 and $5,835,000, respectively, for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, primarily due to dispositions of OM buildings in 2024 and 2025, partially offset by rent escalations.

Previous wording

For our ISHC segment, total property operating expenses increased by $15,291,000 and $34,796,000, respectively, for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, predominately due to increased resident occupancy and levels of care services at the facilities within such segment, thereby increasing labor costs and other operating expenses.

Current wording

For our ISHC segment, total property operating expenses increased by $27,172,000 and $61,968,000, respectively, for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, primarily due to: (i) increased resident occupancy and levels of care services at the facilities within such segment, thereby increasing labor costs and other operating expenses; (ii) an increase of $11,589,000 due to the acquisition in July 2025 of five senior housing properties included in our ISHC segment and located in Ohio and Michigan; and (iii) an increase of $3,380,000 due to the acquisition in July 2025 of four senior housing properties included in our ISHC segment and located in Kentucky.

Previous wording

For our SHOP segment, total property operating expenses increased by $8,430,000 and $17,719,000, respectively, for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, primarily due to: (i) an increase of $3,690,000 and $7,377,000, respectively, due to the acquisition of five senior housing properties in Washington in September 2024; (ii) an increase of $1,479,000 and $2,131,000, respectively, due to higher operating expenses as a result of increased occupancy; (iii) an increase of $899,000 and $1,804,000, due to the acquisition of one senior housing property in Georgia in October 2024; and (iv) an increase of $1,396,000 due to the acquisition of one senior housing property located in Virginia in April 2025. In addition, SHOP expenses increased by $5,052,000 for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, due to the acquisition of 14 senior housing properties in Oregon in February 2024.

Current wording

For our SHOP segment, total property operating expenses increased by $10,230,000 and $27,949,000, respectively, for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, primarily due to: (i) an increase of $2,898,000 and $10,275,000, respectively, due to the acquisition of five senior housing properties in Washington in September 2024; (ii) an increase of $1,696,000 and $3,093,000 due to the acquisition of one senior housing property located in Virginia in April 2025; (iii) an increase of $2,074,000 due to the acquisitions of three senior housing properties in Minnesota and Idaho in the third quarter 2025; (iv) an increase of $819,000 and $2,622,000, due to the acquisition of one senior housing property in Georgia in October 2024; and (v) an increase of $1,394,000 and $2,952,000, respectively, due to higher operating expenses as a result of increased occupancy. In addition, SHOP expenses increased by $5,117,000 for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, due to the acquisition of 14 senior housing properties in Oregon in February 2024.

Previous wording

The decrease in total interest expense for the three and six months ended June 30, 2025, as compared to the three and six months ended June 30, 2024, was primarily due to the $7,249,000 and $18,638,000, respectively, decrease in interest expense related to a decrease in debt balances. Such decrease in debt balances was predominantly a result of the payoff of our variable-rate mortgage loans payable and paydown of our variable-rate lines of credit using net proceeds raised from our equity offerings, since February 2024. The decrease in total interest expense for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, was partially offset by a $1,298,000 loss on extinguishment of debt primarily due to debt payoff of one of our fixed-rate mortgage loans payable in May 2025 and a $1,017,000 change from gain to loss in fair value of derivative financial instruments. The decrease in total interest expense for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was partially offset by the $8,184,000 change from gain to loss in fair value of derivative financial instruments.

Current wording

The decrease in total interest expense for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024, was primarily due to the $8,113,000 and $26,751,000, respectively, decrease in interest expense related to a decrease in debt balances. Such decrease in debt balances was primarily a result of the payoff of our variable-rate mortgage loans payable and paydown of our variable-rate lines of credit using net proceeds raised from our equity offerings since February 2024. The decrease in total interest expense for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, was also driven by a $9,133,000 change from loss to gain in fair value of derivative financial instruments, as well as a $594,000 change from loss to gain on debt and derivative extinguishments primarily due to the early payoff of a mortgage loan payable in August 2025 that was due to mature in August 2029. The decrease in total interest expense for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was also driven by a $2,180,000 decrease in amortization of debt discount/premium, as well as a $949,000 decrease in loss in fair value of derivative financial instruments.

Previous wording

For the three months ended June 30, 2025, we recognized an aggregate net loss on disposition of $2,676,000 primarily related to the sale of three OM buildings and one ISHC. For the six months ended June 30, 2025, we recognized an aggregate net loss on disposition of $3,035,000 primarily related to the sale of one SHOP, two ISHC and three OM buildings. See Note 3, Real Estate Investments — Dispositions of Real Estate Investments, to our accompanying condensed consolidated financial statements for a further discussion.

Current wording

For the three months ended September 30, 2025, we recognized an aggregate net gain on disposition of $691,000 primarily related to the sale of five OM buildings and one triple-net leased property. For the nine months ended September 30, 2025, we recognized an aggregate net loss on disposition of $(2,344,000) primarily related to the sale of one SHOP, two ISHC, eight OM buildings and one triple-net leased property. See Note 3, Real Estate Investments — Dispositions of Real Estate Investments, to our accompanying condensed consolidated financial statements for a further discussion.

Previous wording

For the three months ended June 30, 2024, we did not have any real estate investment dispositions. For the six months ended June 30, 2024, we recognized an aggregate net gain on dispositions of our real estate investments of $2,261,000 related to the sale of two OM buildings and one SHOP.

Current wording

For the three months ended September 30, 2024, we disposed of a land easement on one of our OM properties and recognized a net loss on sale of $(4,000). For the nine months ended September 30, 2024, we recognized an aggregate net gain on dispositions of our real estate investments of $2,257,000 primarily related to the sale of two OM buildings and one SHOP in 2024.

Previous wording

As we continued to evaluate our properties based on their historical operating performance and our expected holding period, for the three and six months ended June 30, 2025, we recognized an aggregate impairment charge of $12,659,000 and $34,365,000, respectively, for five and six OM buildings, respectively. See Note 3, Real Estate Investments — Impairment of Real Estate Investments, to our accompanying condensed consolidated financial statements for a further discussion. For the three and six months ended June 30, 2024, we did not recognize any impairment charges on real estate investments.

Current wording

As we continued to evaluate our properties based on their historical operating performance and our expected holding period, for the three and nine months ended September 30, 2025, we recognized an aggregate impairment charge of $3,768,000 and $38,133,000, respectively, for one and seven OM buildings, respectively. See Note 3, Real Estate Investments — Impairment of Real Estate Investments, to our accompanying condensed consolidated financial statements for a further discussion. For the three and nine months ended September 30, 2024, we did not recognize any impairment charges on real estate investments.

Previous wording

Our principal sources of liquidity are cash flows from operations, net proceeds from the issuances of equity securities, including through our ATM Offering (as defined and described at Note 12, Equity — Common Stock, to our accompanying condensed consolidated financial statements), borrowings under our line of credit and proceeds from the dispositions of real estate investments. For the next 12 months, our principal liquidity needs are to: (i) fund property operating expenses and general and administrative expenses; (ii) meet our debt service requirements (including principal and interest); (iii) fund the acquisition of real estate investments, development activities and capital expenditures; and (iv) make distributions to our stockholders, as required for us to continue to qualify as a REIT. We believe that the sources of liquidity described above will be sufficient to satisfy our cash requirements for the next 12 months and thereafter. We do not have any material off-balance sheet arrangements that we expect would materially affect our liquidity and capital resources.

Current wording

Our principal sources of liquidity are cash flows from operations, net proceeds from the issuances of equity securities, including through our 2025 ATM Offering (as defined and described at Note 12, Equity — Common Stock, to our accompanying condensed consolidated financial statements), borrowings under our lines of credit and proceeds from the dispositions of real estate investments. For the next 12 months, our principal liquidity needs are to: (i) fund property operating expenses and general and administrative expenses; (ii) meet our debt service requirements (including principal and interest); (iii) fund the acquisition of real estate investments, development activities and capital expenditures; and (iv) make distributions to our stockholders, as required for us to continue to qualify as a REIT. We believe that the sources of liquidity described above will be sufficient to satisfy our cash requirements for the next 12 months and thereafter. We do not have any material off-balance sheet arrangements that we expect would materially affect our liquidity and capital resources.

Previous wording

A capital plan for each investment is established upon acquisition that contemplates the estimated capital needs of that investment, including costs of refurbishment, tenant improvements or other major capital expenditures. The capital plan also sets forth the anticipated sources of the necessary capital, which may include operating cash generated by the investment, capital reserves, a line of credit or other loan established with respect to the investment, other borrowings or additional equity investments from us and joint venture partners. The capital plan for each investment is adjusted through ongoing, regular reviews of our portfolio or as necessary to respond to unanticipated additional capital needs. As of June 30, 2025, we had $11,902,000 of restricted cash in loan impounds and reserve accounts to fund a portion of such capital expenditures. Based on the budget for the properties we owned as of June 30, 2025, we estimate that expenditures for capital and tenant improvements as of such date are approximately $45,260,000 for the remaining six months of 2025, although actual expenditures are predominantly discretionary and are dependent on many factors which are not presently known.

Current wording

A capital plan for each investment is established upon acquisition that contemplates the estimated capital needs of that investment, including costs of refurbishment, tenant improvements or other major capital expenditures. The capital plan also sets forth the anticipated sources of the necessary capital, which may include operating cash generated by the investment, capital reserves, a line of credit or other loan established with respect to the investment, other borrowings or additional equity investments from us and joint venture partners. The capital plan for each investment is adjusted through ongoing, regular reviews of our portfolio or as necessary to respond to unanticipated additional capital needs. As of September 30, 2025, we had $12,220,000 of restricted cash in loan impounds and reserve accounts to fund a portion of such capital expenditures. Based on the budget for the properties we owned as of September 30, 2025, we estimate that expenditures for capital and tenant improvements as of such date are approximately $22,686,000 for the remaining three months of 2025, although actual expenditures are predominantly discretionary and are dependent on many factors which are not presently known.

Previous wording

As of June 30, 2025, our borrowing capacity under the 2024 Credit Facility was $1,150,000,000. As of June 30, 2025, our borrowings outstanding under such credit facility was $550,000,000, and we had $600,000,000 available on such facility. We believe that such resource will be sufficient to satisfy our cash requirements for the next 12 months and the longer term thereafter.

Current wording

As of September 30, 2025, we are party to a credit agreement, as amended, with an aggregate maximum principal amount up to $1,150,000,000, or the 2024 Credit Facility. See Note 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements for a further discussion. As of September 30, 2025, our borrowing capacity under the 2024 Credit Facility was $1,150,000,000, our borrowings outstanding under such credit facility was $550,000,000, and we had $600,000,000 available on such facility. We believe that such resource will be sufficient to satisfy our cash requirements for the next 12 months and the longer term thereafter.

Previous wording

We are party to a credit agreement, as amended, with an aggregate maximum principal amount up to $1,150,000,000, or the 2024 Credit Facility. See Note 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements for a further discussion.

Current wording

Subsequent to September 30, 2025, we entered into a credit agreement regarding a senior secured revolving credit facility with an aggregate maximum principal amount of $50,000,000, or the 2025 Trilogy Credit Facility. See Note 19, Subsequent Event, to our accompanying condensed consolidated financial statements for a further discussion.

Previous wording

For the six months ended June 30, 2025 and 2024, cash flows from operating activities were primarily related to property operations, offset by payments of general and administrative expenses and interest payments on our outstanding indebtedness. In general, cash flows from operating activities are affected by the timing of cash receipts and payments, and have increased since 2024 primarily due to improved resident occupancy and expense management at our properties operated under a RIDEA structure. The increase in net cash provided by operating activities for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, was primarily driven by the increase in operating performance of our real estate investments in our ISHC and SHOP segments, as well as a decrease in interest paid on our outstanding indebtedness as a result of mortgage loan payoffs and paydowns on our lines of credit using net proceeds from our equity offerings in 2024 and 2025. See the “Results of Operations” section above for a further discussion.

Current wording

For the nine months ended September 30, 2025 and 2024, cash flows from operating activities were primarily related to property operations, offset by payments of general and administrative expenses and interest payments on our outstanding indebtedness. In general, cash flows from operating activities are affected by the timing of cash receipts and payments, and have increased since 2024 primarily due to improved resident occupancy and expense management at our properties operated under a RIDEA structure. The increase in net cash provided by operating activities for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, was primarily driven by the increase in operating performance of our real estate investments in our ISHC and SHOP segments, as well as a decrease in interest paid on our outstanding indebtedness as a result of mortgage loan payoffs and paydowns on our lines of credit using net proceeds from our equity offerings in 2024 and 2025. See the “Results of Operations” section above for a further discussion.

Previous wording

For the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, the increase in net cash used in investing activities was primarily due to a $35,458,000 increase in cash paid to acquire real estate investments, a $9,702,000 increase in developments and capital expenditures, a $4,110,000 decrease in net principal repayments on real estate notes receivable and a $1,606,000 increase in deposits paid in pursuit of future real estate investments, partially offset by a $21,908,000 increase in proceeds from dispositions of real estate investments.

Current wording

For the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, the increase in net cash used in investing activities was primarily due to a $288,294,000 increase in cash paid to acquire real estate investments and a $18,173,000 increase in developments and capital expenditures, partially offset by a $32,053,000 increase in proceeds from dispositions of real estate investments.

Previous wording

For the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, the decrease in net cash provided by financing activities was primarily due to a $536,500,000 decrease in gross equity offering proceeds and a $29,831,000 increase in distributions paid. Such amounts were partially offset by a $467,839,000 decrease in net payments on our lines of credit and mortgage loans payable primarily using the net proceeds from equity offerings, a $47,156,000 decrease in the payment of offering costs, a $36,083,000 decrease in cash paid to redeem certain equity interests owned in Trilogy Investors, LLC, as well as a $6,856,000 decrease in deferred financing costs paid.

Current wording

For the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, the increase in net cash provided by financing activities was primarily due to a $624,696,000 decrease in net payments on our lines of credit and mortgage loans payable primarily using the net proceeds from equity offerings, a $65,171,000 decrease in the payment of offering costs and a $7,961,000 decrease in deferred financing costs paid. Further, in 2024, we paid $258,001,000 to purchase the noncontrolling interest in Trilogy REIT Holdings LLC held by a joint venture partner, and paid $36,083,000 to redeem certain equity interests owned in Trilogy Investors, LLC. Such amounts were partially offset by a $764,460,000 decrease in gross equity offering proceeds and a $38,075,000 increase in distributions paid.

Previous wording

For a discussion of our lines of credit and term loan, see Note 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements.

Current wording

For a discussion of our lines of credit and term loan, see Note 8, Lines of Credit and Term Loan, and Note 19, Subsequent Event, to our accompanying condensed consolidated financial statements.

Previous wording

A significant liquidity need is the payment of principal and interest on our outstanding indebtedness. As of June 30, 2025, we had $1,004,016,000 of fixed-rate mortgage loans payable outstanding secured by our properties. As of June 30, 2025, we had $550,000,000 outstanding, and $600,000,000 remained available under our line of credit. The weighted average effective interest rate on our outstanding debt, factoring in our interest rate swaps, was 4.33% per annum as of June 30, 2025. See Note 7, Mortgage Loans Payable, and Note 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements.

Current wording

A significant liquidity need is the payment of principal and interest on our outstanding indebtedness. As of September 30, 2025, we had $991,012,000 of fixed-rate mortgage loans payable outstanding secured by our properties. As of September 30, 2025, we had $550,000,000 outstanding, and $600,000,000 remained available under our line of credit. The weighted average effective interest rate on our outstanding debt, factoring in our interest rate swaps, was 4.34% per annum as of September 30, 2025. See Note 7, Mortgage Loans Payable, and Note 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements.

Previous wording

We define normalized FFO attributable to controlling interest, or Normalized FFO, as FFO further adjusted for the following items included in the determination of GAAP net income (loss): expensed acquisition fees and costs, which we refer to as business acquisition expenses; amounts relating to changes in deferred rent and amortization of above- and below-market leases; the non-cash impact of changes to our equity instruments; non-cash or non-recurring income or expense; the non-cash effect of income tax benefits or expenses; capitalized interest; impairment of intangible assets and goodwill; amortization of closing costs on debt security investments; mark-to-market adjustments included in net income (loss); gains or losses included in net income (loss) from the extinguishment or sale of debt, hedges, foreign exchange, derivatives or securities holdings where trading of such holdings is not a fundamental attribute of the business plan; and after adjustments for consolidated and unconsolidated partnerships and joint ventures, with such adjustments calculated to reflect Normalized FFO on the same basis.

Current wording

We define normalized FFO attributable to controlling interest, or Normalized FFO, as FFO further adjusted for the following items included in the determination of GAAP net income (loss): transaction, transition and restructuring costs; amounts relating to changes in deferred rent and amortization of above- and below-market leases; the non-cash impact of changes to our equity instruments; non-cash or non-recurring income or expense; the non-cash effect of income tax benefits or expenses; capitalized interest; impairment of intangible assets and goodwill; amortization of closing costs on debt security investments; mark-to-market adjustments included in net income (loss); gains or losses included in net income (loss) from the extinguishment or sale of debt, hedges, foreign exchange, derivatives or securities holdings where trading of such holdings is not a fundamental attribute of the business plan; and after adjustments for consolidated and unconsolidated partnerships and joint ventures, with such adjustments calculated to reflect Normalized FFO on the same basis.

Previous wording

Net operating income, or NOI, is a non-GAAP financial measure that is defined as net income (loss), computed in accordance with GAAP, generated from properties before general and administrative expenses, business acquisition expenses, depreciation and amortization, interest expense, gain or loss in fair value of derivative financial instruments, gain or loss on dispositions of real estate investments, impairment of real estate investments, impairment of intangible assets and goodwill, income or loss from unconsolidated entities, gain on re-measurement of previously held equity interests, foreign currency gain or loss, other income or expense and income tax benefit or expense.

Current wording

Net operating income, or NOI, is a non-GAAP financial measure that is defined as net income (loss), computed in accordance with GAAP, generated from properties before general and administrative expenses, transaction, transition and restructuring costs, depreciation and amortization, interest expense, gain or loss in fair value of derivative financial instruments, gain or loss on dispositions of real estate investments, impairment of real estate investments, impairment of intangible assets and goodwill, income or loss from unconsolidated entities, gain on re-measurement of previously held equity interests, foreign currency gain or loss, other income or expense and income tax benefit or expense.