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 2025 Annual Report on Form 10-K, as filed with the United States Securities and Exchange Commission, or SEC, on February 27, 2026. Such condensed consolidated financial statements and information have been prepared to reflect our financial position as of March 31, 2026 and December 31, 2025, together with our results of operations and cash flows for the three months ended March 31, 2026 and 2025. 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 on-going 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 Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the United States Securities and Exchange Commission, or SEC, on February 27, 2026, or the 2025 Annual Report on Form 10-K. Such condensed consolidated financial statements and information have been prepared to reflect our financial position as of June 30, 2026 and December 31, 2025, together with our results of operations for the three and six months ended June 30, 2026 and 2025 and cash flows for the six months ended June 30, 2026 and 2025. 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 on-going operations and occupancy of our tenants and residents.

Previous wording

Certain statements contained in this report, other than historical facts, may be considered forward-looking statements within the meaning of Section 27A of the Securities Act, Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the Private Securities Litigation Reform Act of 1995 (collectively with the Securities Act and Exchange Act, or the “Acts”). We intend for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in the Acts. Such forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “can,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue,” “possible,” “initiatives,” “focus,” “seek,” “objective,” “goal,” “strategy,” “plan,” “potential,” “potentially,” “preparing,” “projected,” “future,” “long-term,” “once,” “should,” “could,” “would,” “might,” “uncertainty,” or other similar words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this report is filed with the SEC.

Current wording

Certain statements contained in this report, other than historical facts, may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the Private Securities Litigation Reform Act of 1995 (collectively with the Securities Act and Exchange Act, or the “Acts”). We intend for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in the Acts. Such forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “can,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue,” “possible,” “initiatives,” “focus,” “seek,” “objective,” “goal,” “strategy,” “plan,” “potential,” “potentially,” “preparing,” “projected,” “future,” “long-term,” “once,” “should,” “could,” “would,” “might,” “uncertainty,” or other similar words.

Previous wording

Any such forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which we operate, and beliefs of, and assumptions made by, our management and involve uncertainties that could significantly affect our financial results. Such statements include, but are not limited to: (i) statements about our plans, strategies, initiatives and prospects, including any future capital-raising initiatives and planned or future acquisitions or dispositions of properties and other assets; and (ii) statements about our future results of operations, capital expenditures and liquidity. Such statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those projected or anticipated, including, without limitation: changes in economic conditions generally and the real estate market specifically; legislative and regulatory changes, including changes to laws governing the taxation of real estate investment trusts, or REITs, and regulations or proposed regulations governing the operations and sales of healthcare properties; the availability of capital; our ability to pay down, refinance, restructure or extend our indebtedness as it becomes due; our ability to maintain our qualification as a REIT for U.S. federal income tax purposes; changes in interest rates, and foreign currency risk; competition in the real estate industry; changes in accounting principles generally accepted in the United States of America, or GAAP, policies and guidelines applicable to REITs; the success of our investment strategy; cybersecurity incidents and information technology failures, including unauthorized access to our computer systems and/or our vendors’ computer systems and our third-party management companies’ computer systems and/or their vendors’ computer systems; our ability to retain our executive officers and key employees; our ability to settle outstanding forward sale agreements; unexpected labor costs and inflationary pressures; changing macroeconomic, domestic legal and fiscal policies and geopolitical conditions; and those risks identified in Item 1A, Risk Factors in our 2025 Annual Report on Form 10-K, as filed with the SEC on February 27, 2026, this Quarterly Report on Form 10-Q, and any future filings we make with the SEC. These risks and uncertainties should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements. Forward-looking statements in this Quarterly Report on Form 10-Q speak only as of the date on which such statements are made, and undue reliance should not be placed on such statements. We undertake no obligation to update any such statements that may become untrue because of subsequent events. Additional information concerning us and our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Any such forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which we operate, and beliefs of, and assumptions made by, our management and involve uncertainties that could significantly affect our financial results. Such statements include, but are not limited to: (i) statements about our plans, strategies, initiatives and prospects, including any future capital-raising initiatives and planned or future acquisitions or dispositions of properties and other assets; and (ii) statements about our future results of operations, capital expenditures and liquidity. Such statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those projected or anticipated, including, without limitation: changes in economic conditions generally and the real estate market specifically; legislative and regulatory changes, including changes to laws governing the taxation of real estate investment trusts, or REITs, and regulations or proposed regulations governing the operations and sales of healthcare properties; the availability of capital; our ability to pay down, refinance, restructure or extend our indebtedness as it becomes due; our ability to maintain our qualification as a REIT for U.S. federal income tax purposes; changes in interest rates; competition in the real estate industry; changes in accounting principles generally accepted in the United States of America, or GAAP, policies and guidelines applicable to REITs; the success of our investment strategy; cybersecurity incidents and information technology failures, including unauthorized access to our computer systems and/or our vendors’ computer systems and our third-party management companies’ computer systems and/or their vendors’ computer systems; our ability to retain our executive officers and key employees; our ability to settle outstanding forward sale agreements; unexpected labor costs and inflationary pressures; changing macroeconomic, domestic legal and fiscal policies and geopolitical conditions; and those risks identified in Item 1A, Risk Factors in our 2025 Annual Report on Form 10-K, this Quarterly Report on Form 10-Q, and any future filings we make with the SEC. These risks and uncertainties should be considered in evaluating forward-looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q speak only as of the date on which such statements are made, and undue reliance should not be placed on such statements. We undertake no obligation to update any such statements that may become untrue because of subsequent events. Additional information concerning us and our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

Previous wording

American Healthcare REIT, Inc., a Maryland corporation, is a self-managed REIT that acquires, owns and operates a diversified portfolio of clinical healthcare real estate properties, focusing primarily on senior housing, skilled nursing facilities, or SNFs, outpatient medical, or OM, buildings, and other healthcare-related facilities. We have built a fully-integrated management platform that operates clinical healthcare properties throughout the United States, and in the United Kingdom and the Isle of Man. We own and operate our integrated senior health campuses, or ISHC, and senior-housing operating properties, or SHOP, utilizing the structure permitted by the REIT Investment Diversification and Empowerment Act of 2007, which is commonly referred to as a “RIDEA” structure. We have also originated and acquired secured loans and may acquire other real estate-related investments in the future on an infrequent and opportunistic basis. We generally seek investments that produce current income; however, we have selectively developed, and may continue to selectively develop, healthcare real estate properties. We have elected to be taxed as a REIT for U.S. federal income tax purposes. We believe that we have been organized and operated, and we intend to continue to operate, in conformity with the requirements for qualification and taxation as a REIT under the Internal Revenue Code of 1986, or the Code.

Current wording

American Healthcare REIT, Inc., a Maryland corporation, is a self-managed REIT that acquires, owns and operates a diversified portfolio of clinical healthcare real estate properties, focusing primarily on senior housing, skilled nursing facilities, outpatient medical, or OM, buildings, and other healthcare-related facilities. We have built a fully-integrated management platform that operates clinical healthcare properties throughout the United States, and in the United Kingdom and the Isle of Man. We own and operate our integrated senior health campuses, or ISHC, and senior housing operating properties, or SHOP, utilizing the structure permitted by the REIT Investment Diversification and Empowerment Act of 2007, which is commonly referred to as a “RIDEA” structure. We have also originated and acquired secured loans and may acquire other real estate-related investments in the future on an infrequent and opportunistic basis. We generally seek investments that produce current income; however, we have selectively developed, and may continue to selectively develop, healthcare real estate properties. We have elected to be taxed as a REIT for U.S. federal income tax purposes. We believe that we have been organized and operated, and we intend to continue to operate, in conformity with the requirements for qualification and taxation as a REIT under the Internal Revenue Code of 1986, or the Code.

Previous wording

We conduct substantially all of our operations through American Healthcare REIT Holdings, LP, or our operating partnership, and we are the sole general partner of our operating partnership. As of both March 31, 2026 and December 31, 2025, we owned 99.0% of the operating partnership units, or OP units, in our operating partnership, and the remaining 1.0% of the OP units were owned by the following limited partners: (i) AHI Group Holdings, LLC, which is owned and controlled by Jeffrey T. Hanson, our Chairman of the Board of Directors and Interim Chief Executive Officer and President, Danny Prosky, our Chief Executive Officer, President and director, who is currently taking a leave of absence from his executive role for medical reasons, and Mathieu B. Streiff, one of our independent directors; and (ii) a wholly-owned subsidiary of Griffin Capital Company, LLC.

Current wording

We conduct substantially all of our operations through American Healthcare REIT Holdings, LP, or our operating partnership, and we are the sole general partner of our operating partnership. As of both June 30, 2026 and December 31, 2025, we owned 99.0% of the operating partnership units, or OP units, in our operating partnership, and the remaining 1.0% of the OP units were owned by the following limited partners: (i) AHI Group Holdings, LLC, which is owned and controlled by Jeffrey T. Hanson, our Chairman of the Board of Directors and Chief Executive Officer, Danny Prosky, one of our non-executive directors, and Mathieu B. Streiff, one of our independent directors; and (ii) a wholly-owned subsidiary of Griffin Capital Company, LLC.

Previous wording

We currently operate through four reportable business segments: ISHC, OM, SHOP and triple-net leased properties. As of March 31, 2026, we owned and/or operated 343 buildings and ISHC, which represent in total approximately 22,651,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $5,607,085,000. In addition, as of March 31, 2026, 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, SHOP, OM and triple-net leased properties. As of June 30, 2026, we owned and/or operated 347 buildings and ISHC, which represent in total approximately 23,340,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $5,728,543,000. In addition, as of June 30, 2026, we also owned a real estate-related debt investment purchased for $60,429,000.

Previous wording

Our accompanying condensed consolidated financial statements are prepared in conformity with GAAP, which requires management to make estimates and assumptions that affect the amounts reported in our financial statements and accompanying footnotes. These estimates are made and evaluated on an on-going basis using information that is currently available, as well as various other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates, perhaps in material adverse ways, and those estimates could be different under different assumptions or conditions. The complete listing of our Critical Accounting Estimates was previously disclosed in our 2025 Annual Report on Form 10-K, as filed with the SEC on February 27, 2026, and there have been no material changes to our Critical Accounting Estimates as disclosed therein, except as included within Note 2, Summary of Significant Accounting Policies, to our accompanying condensed consolidated financial statements.

Current wording

Our accompanying condensed consolidated financial statements are prepared in conformity with GAAP, which requires management to make estimates and assumptions that affect the amounts reported in our financial statements and accompanying footnotes. These estimates are made and evaluated on an on-going basis using information that is currently available, as well as various other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates, perhaps in material adverse ways, and those estimates could be different under different assumptions or conditions. The complete listing of our Critical Accounting Estimates was previously disclosed in our 2025 Annual Report on Form 10-K, and there have been no material changes to our Critical Accounting Estimates as disclosed therein, except as included within Note 2, Summary of Significant Accounting Policies, to our accompanying condensed consolidated financial statements.

Previous wording

For a discussion of interim unaudited financial data, see Note 2, Summary of Significant Accounting Policies — Interim Unaudited Financial Data, to our accompanying condensed consolidated financial statements. Our accompanying condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto included in our 2025 Annual Report on Form 10-K, as filed with the SEC on February 27, 2026.

Current wording

For a discussion of interim unaudited financial data, see Note 2, Summary of Significant Accounting Policies — Interim Unaudited Financial Data, to our accompanying condensed consolidated financial statements. Our accompanying condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto included in our 2025 Annual Report on Form 10-K.

Previous wording

For a discussion of our acquisitions of investments in 2026, see Note 3, Real Estate Investments, to our accompanying condensed consolidated financial statements.

Current wording

For a discussion of our acquisitions and dispositions of investments in 2026, see Note 3, Real Estate Investments, to our accompanying condensed consolidated financial statements.

Previous wording

Other than the effects of inflation discussed below, as well as other national economic conditions affecting real estate generally, and as otherwise disclosed in our risk factors, we are not aware of any material trends or uncertainties that may reasonably be expected to have a material impact, favorable or unfavorable, on revenues or income from the acquisition, disposition, management and operation of our properties. For a further discussion of these and other factors that could impact our future results or performance, see “Forward-Looking Statements” above and Part II, Item 1A, Risk Factors, of this Quarterly Report on Form 10-Q and those Risk Factors previously disclosed in our 2025 Annual Report on Form 10-K, as filed with the SEC on February 27, 2026.

Current wording

Other than the effects of inflation and scheduled lease expirations discussed below, as well as other national economic conditions affecting real estate generally, and as otherwise disclosed in our risk factors, we are not aware of any material trends or uncertainties that may reasonably be expected to have a material impact, favorable or unfavorable, on revenues or income from the acquisition, disposition, management and operation of our properties. For a further discussion of these and other factors that could impact our future results or performance, see “Forward-Looking Statements” above and Part II, Item 1A, Risk Factors, of this Quarterly Report on Form 10-Q and those Risk Factors previously disclosed in our 2025 Annual Report on Form 10-K, as filed with the SEC on February 27, 2026.

Previous wording

During the three months ended March 31, 2026 and 2025, inflation has affected our operations. The annual rate of inflation in the United States was 3.3% in March 2026 and 2.4% in March 2025, 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, our RIDEA managers may have billed higher than average annual rent and care fee increases for existing residents in 2025 and 2026, 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 six months ended June 30, 2026 and 2025, inflation has affected our operations. The annual rate of inflation in the United States was 3.5% in June 2026 and 2.7% in June 2025, 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, our RIDEA managers may have billed higher than average annual rent and care fee increases for existing residents in 2025 and 2026, 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 March 31, 2026, our properties were 90.7% leased, and, during the remainder of 2026, 4.8% 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 March 31, 2026, our remaining weighted average lease term was 6.7 years, excluding our ISHC and SHOP.

Current wording

Excluding our ISHC and SHOP, as of June 30, 2026, our properties were 90.8% leased, and, during the remainder of 2026, 2.9% 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, 2026, our remaining weighted average lease term was 6.7 years, excluding our ISHC and SHOP.

Previous wording

Our combined ISHC and SHOP were 89.8% leased as of March 31, 2026. 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 90.4% leased as of June 30, 2026. Substantially all of our leases with residents at such properties are for a term of one year or less.

Previous wording

Comparison of Three Months Ended March 31, 2026 and 2025

Current wording

Comparison of Three and Six Months Ended June 30, 2026 and 2025

Previous wording

We segregate our operations into reporting segments in order to assess the performance of our business in the same way that management reviews our performance and makes operating decisions. As of March 31, 2026, we operated through four reportable business segments: ISHC, OM, SHOP and triple-net leased properties. During the three months ended March 31, 2026, we reclassified two senior housing properties from our SHOP segment to our ISHC segment to align the properties that are operated by Trilogy Management Services, LLC within ISHC. Prior-period segment results discussed below have been recast to conform to the current-period presentation, and the reclassification did not affect consolidated results.

Current wording

We segregate our operations into reporting segments in order to assess the performance of our business in the same way that management reviews our performance and makes operating decisions. As of June 30, 2026, we operated through four reportable business segments: ISHC, SHOP, OM and triple-net leased properties. During the first quarter of 2026, we reclassified two senior housing properties from our SHOP segment to our ISHC segment to align the properties that are managed by Trilogy Management Services, LLC within ISHC. Prior-period segment results discussed below have been recast to conform to the current-period presentation, and the reclassification did not affect consolidated results.

Previous wording

The most significant drivers behind changes in our consolidated results of operations for the three months ended March 31, 2026 compared to the corresponding period in 2025 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 during 2026. As of March 31, 2026 and 2025, 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 six months ended June 30, 2026 compared to the corresponding period in 2025 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 2026. As of June 30, 2026 and 2025, we owned and/or operated the following types of properties (dollars in thousands):

Previous wording

Weighted average leased percentage excludes our ISHC and SHOP.

Current wording

Weighted average leased percentage excludes our ISHC and SHOP segments.

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 months ended March 31, 2026 and 2025, resident fees and services revenue primarily consisted of rental fees related to resident leases, extended healthcare 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 six months ended June 30, 2026 and 2025, resident fees and services revenue primarily consisted of rental fees related to resident leases, extended healthcare 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 $74,051,000 for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to: (i) increased resident occupancy, a more favorable payor mix and higher resident fees as a result of an increase in billing rates and levels of care service; (ii) an increase of $19,618,000 due to the acquisition in July 2025 of nine senior housing properties located in Ohio, Michigan and Kentucky; and (iii) an increase of $34,438,000 due to the acquisition in December 2025 of 14 senior housing properties located in Ohio, Indiana, New Mexico and North Carolina.

Current wording

For our ISHC segment, we increased resident fees and services revenue by $83,528,000 and $157,579,000, respectively, for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to: (i) increased resident occupancy, a more favorable payor mix and higher resident fees as a result of an increase in billing rates and levels of care service; (ii) an increase of $20,788,000 and $40,406,000, respectively, due to the acquisition in July 2025 of nine senior housing properties located in Ohio, Michigan and Kentucky; and (iii) an increase of $35,278,000 and $69,717,000, respectively, due to the acquisition in December 2025 of 14 senior housing properties located in Ohio, Indiana, New Mexico and North Carolina.

Previous wording

For our SHOP segment, resident fees and services revenue increased $38,540,000 for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to: (i) an increase of $3,419,000 due to the acquisition of one senior housing property in Virginia in April 2025; (ii) an increase of $3,904,000 due to the acquisition of three senior housing properties in Minnesota and Idaho in the third quarter 2025; (iii) an increase of $22,676,000 due to the acquisition of 10 senior housing properties in California, Minnesota, Pennsylvania, Utah and Wisconsin in the fourth quarter of 2025; (iv) an increase of $6,924,000 due to the acquisition of seven senior housing properties in California, Kansas and Missouri in the first quarter of 2026; and (v) increased resident occupancy and higher resident fees as a result of an increase in billing rates.

Current wording

For our SHOP segment, resident fees and services revenue increased by $49,706,000 and $88,246,000, respectively, for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to: (i) an increase of $814,000 and $4,232,000, respectively, due to the acquisition of one senior housing property in Virginia in April 2025; (ii) an increase of $4,076,000 and $7,980,000, respectively, due to the acquisition of three senior housing properties in Minnesota and Idaho in the third quarter of 2025; (iii) an increase of $23,033,000 and $45,709,000, respectively, due to the acquisition of 10 senior housing properties in California, Minnesota, Pennsylvania, Utah and Wisconsin in the fourth quarter of 2025; (iv) an increase of $10,918,000 and $14,945,000, respectively, due to the acquisition of seven senior housing properties in California, Kansas and Missouri in the first quarter of 2026; (v) an increase of $5,967,000 due to the acquisition of seven senior housing properties in Georgia, Minnesota and South Carolina in the second quarter of 2026; and (vi) increased resident occupancy and higher resident fees as a result of an increase in billing rates.

Previous wording

ISHC and SHOP typically have a higher percentage of direct operating expenses to revenue than OM buildings and triple-net leased properties due to the nature of RIDEA-type facilities where we conduct day-to-day operations. Property operating expenses and property operating expenses as a percentage of resident fees and services revenue, as well as rental expenses and rental expenses as a percentage of real estate revenue, by reportable segment consisted of the following for the periods presented below (dollars in thousands):

Current wording

ISHC and SHOP segments typically have a higher percentage of direct operating expenses to revenue than OM segment and triple-net leased properties segment due to the nature of RIDEA-type facilities where we conduct day-to-day operations. Property operating expenses and property operating expenses as a percentage of resident fees and services revenue, as well as rental expenses and rental expenses as a percentage of real estate revenue, by reportable segment consisted of the following for the periods presented below (dollars in thousands):

Previous wording

For our ISHC segment, total property operating expenses increased by $55,283,000 for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, 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 $16,383,000 due to the acquisition in July 2025 of nine senior housing properties located in Ohio, Michigan and Kentucky; and (iii) an increase of $31,047,000 due to the acquisition in December 2025 of 14 senior housing properties located in Ohio, Indiana, New Mexico and North Carolina.

Current wording

For our ISHC segment, total property operating expenses increased by $66,303,000 and $121,586,000, respectively, for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, 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 $16,935,000 and $33,318,000, respectively, due to the acquisition in July 2025 of nine senior housing properties located in Ohio, Michigan and Kentucky; and (iii) an increase of $31,420,000 and $62,466,000, respectively, due to the acquisition in December 2025 of 14 senior housing properties located in Ohio, Indiana, New Mexico and North Carolina.

Previous wording

For our SHOP segment, total property operating expenses increased by $24,465,000 for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to: (i) an increase of $1,857,000 due to the acquisition of one senior housing property located in Virginia in April 2025; (ii) an increase of $2,870,000 due to the acquisitions of three senior housing properties in Minnesota and Idaho in the third quarter 2025; (iii) an increase of $14,861,000 due to the acquisition of 10 senior housing properties in California, Minnesota, Pennsylvania, Utah and Wisconsin in the fourth quarter of 2025; (iv) an increase of $5,638,000 due to the acquisition of seven senior housing properties in California, Kansas and Missouri in the first quarter of 2026; and (v) increased occupancy at the facilities within such segment, which resulted in increasing labor costs from additional staffing and other operating expenses.

Current wording

For our SHOP segment, total property operating expenses increased by $32,250,000 and $56,715,000, respectively, for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to: (i) an increase of $505,000 and $2,363,000, respectively, due to the acquisition of one senior housing property located in Virginia in April 2025; (ii) an increase of $2,887,000 and $5,755,000, respectively, due to the acquisitions of three senior housing properties in Minnesota and Idaho in the third quarter of 2025; (iii) an increase of $15,102,000 and $29,965,000, respectively, due to the acquisition of 10 senior housing properties in California, Minnesota, Pennsylvania, Utah and Wisconsin in the fourth quarter of 2025; (iv) an increase of $7,993,000 and $11,023,000, respectively, due to the acquisition of seven senior housing properties in California, Kansas and Missouri in the first quarter of 2026; (v) an increase of $4,236,000 due to the acquisition of seven senior housing properties in Georgia, Minnesota and South Carolina in the second quarter of 2026; and (vi) increased occupancy at the facilities within such segment, which resulted in increasing labor costs from additional staffing and other operating expenses.

Previous wording

For the three months ended March 31, 2026 and 2025, depreciation and amortization was $67,062,000 and $41,114,000, respectively, which primarily consisted of depreciation on our operating properties of $44,756,000 and $36,577,000, respectively, and amortization of our identified intangible assets of $21,568,000 and $3,823,000, respectively. For the three months ended March 31, 2026 as compared to the three months ended March 31, 2025, depreciation and amortization increased by $25,948,000, primarily attributable to the amortization of in-place leases due to property acquisitions since 2025.

Current wording

For the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, depreciation and amortization increased by $30,184,000 and $56,132,000, respectively, primarily attributable to an increase of $20,904,000 and $38,673,000, respectively, in the amortization of in-place leases due to property acquisitions since 2025.

Previous wording

The decrease in total interest expense for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, was primarily due to the $2,405,000 decrease in interest expense related to a decrease in debt balances on our revolving line of credit during 2025. Such decrease was primarily a result of the paydown of our variable-rate lines of credit using net proceeds raised from our equity offerings during 2025 and cash flow from operations. The decrease in total interest expense for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, was also driven by a $2,277,000 change from loss to gain in fair value of derivative financial instruments.

Current wording

The decrease in total interest expense for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, was primarily due to the $2,610,000 and $5,454,000, respectively, decrease in interest expense related to a decrease in debt balances on our revolving line of credit during 2025 and 2026. Such decrease was primarily a result of the paydown of our variable-rate lines of credit using net proceeds raised from our equity offerings during 2025 and cash flow from operations. The decrease in total interest expense for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, was also driven by a $986,000 and $3,263,000, respectively, change from loss to gain in fair value of derivative financial instruments and a $1,151,000 and $1,659,000, respectively, decrease in loss on debt extinguishments.

Previous wording

As we continued to evaluate our properties based on their historical operating performance and our expected holding period, for the three months ended March 31, 2026, we recognized an impairment charge of $418,000 for one OM building. For the three months ended March 31, 2025, we determined that one of our OM buildings was impaired and recognized an impairment charge of $21,706,000. See Note 3, Real Estate Investments — Impairment of Real Estate Investments, to our accompanying condensed consolidated financial statements for a further discussion.

Current 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, 2026, we recognized an aggregate impairment charge of $1,719,000 and $2,137,000, respectively for one and two OM buildings, respectively. 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.

Previous wording

Our principal sources of liquidity are cash flows from operations, net proceeds from the issuances of equity securities, including through the 2026 ATM Offering (as defined and described at Note 11, Equity — Common Stock, to our accompanying condensed consolidated financial statements), and borrowings under our lines of credit. 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 shares through our equity offerings, including through the 2026 ATM Offering and the May 2026 Offering (as defined and described in Note 11, Equity — Common Stock, to our accompanying condensed consolidated financial statements), and borrowings under our lines of credit. 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 the longer-term 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 on-going, regular reviews of our portfolio or as necessary to respond to unanticipated additional capital needs. As of March 31, 2026, we had $11,597,000 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 March 31, 2026, we estimate that expenditures for capital and tenant improvements as of such date will be approximately $71,789,000 for the remaining nine months of 2026, 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 on-going, regular reviews of our portfolio or as necessary to respond to unanticipated additional capital needs. As of June 30, 2026, we had $11,251,000 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, 2026, we estimate that expenditures for capital and tenant improvements as of such date will be approximately $53,250,000 for the remaining six months of 2026, although actual expenditures are predominantly discretionary and are dependent on many factors which are not presently known.

Previous wording

As of March 31, 2026, we were party to a credit agreement, as amended, with an aggregate maximum principal amount up to $1,150,000,000, or the 2024 Credit Facility. On April 1, 2026, we, through our operating partnership, entered into an amendment to the 2024 Credit Facility, which increased the aggregate maximum principal amount of such facility to $1,350,000,000, or the 2026 Credit Facility. In addition, we are party to an 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 8, Lines of Credit and Term Loan, and Note 18, Subsequent Event — 2026 Credit Facility, to our accompanying condensed consolidated financial statements for a further discussion.

Current wording

As of June 30, 2026, we are party to a credit agreement, as amended, with an aggregate maximum principal amount up to $1,350,000,000, or the 2026 Credit Facility. In addition, we are party to an 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 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements for a further discussion.

Previous wording

As of March 31, 2026, our aggregate borrowing capacity under the 2024 Credit Facility and the 2025 Trilogy Credit Facility was $1,200,000,000. As of March 31, 2026, our aggregate borrowings outstanding under such credit facilities was $550,000,000, and we had $650,000,000 available on such facilities. We believe that such resources will be sufficient to satisfy our cash requirements for the next 12 months and the longer term thereafter.

Current wording

As of June 30, 2026, our aggregate borrowing capacity under the 2026 Credit Facility and the 2025 Trilogy Credit Facility was $1,400,000,000. As of June 30, 2026, our aggregate borrowings outstanding under such credit facilities was $550,000,000, and we had $850,000,000 available on such facilities.

Previous wording

For the three months ended March 31, 2026 and 2025, 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 2025 primarily due to improved resident occupancy, an increase in billing rates and expense management at our properties operated under a RIDEA structure, 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 2025. See the “Results of Operations” section above for a further discussion.

Current wording

For the six months ended June 30, 2026 and 2025, 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 2025 primarily due to improved resident occupancy, an increase in billing rates and expense management at our properties operated under a RIDEA structure, the increase in the size of our real estate investments portfolio since 2025 thereby increasing our net operating income, 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 2025. See the “Results of Operations” section above for a further discussion.

Previous wording

For the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, the increase in net cash used in investing activities was primarily due to a $149,495,000 increase in cash paid to acquire real estate investments and a $17,136,000 increase in developments and capital expenditures.

Current wording

For the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, the increase in net cash used in investing activities was primarily due to a $209,863,000 increase in cash paid to acquire real estate investments, a $37,929,000 increase in developments and capital expenditures, as well as a $29,120,000 decrease in proceeds from dispositions of real estate investments.

Previous wording

For the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, the change from net cash used in financing activities to net cash provided by financing activities was primarily due to a $143,886,000 increase in gross equity offering proceeds and a $21,996,000 decrease in net payments on our lines of credit and mortgage loans payable primarily using the net proceeds from equity offerings. Such amounts were partially offset by a $7,819,000 increase in payments to taxing authorities in connection with common stock directly withheld from employees and a $7,274,000 increase in distributions paid.

Current wording

For the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, the increase in net cash provided by financing activities was primarily due to a $184,467,000 increase in gross equity offering proceeds and a $44,246,000 decrease in net payments on our lines of credit and mortgage loans payable primarily using the net proceeds from equity offerings. Such amounts were partially offset by a $8,618,000 increase in payments to taxing authorities in connection with common stock directly withheld from employees and a $15,006,000 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, and Note 18, Subsequent Event — 2026 Credit Facility, 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, 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 March 31, 2026, we had $980,045,000 of fixed-rate mortgage loans payable outstanding secured by our properties. As of March 31, 2026, we had $550,000,000 outstanding, and $650,000,000 remained available under our lines of credit. The weighted average effective interest rate on our outstanding debt, factoring in our interest rate swaps, was 4.14% per annum as of March 31, 2026. 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 June 30, 2026, we had $890,070,000 of fixed-rate mortgage loans payable outstanding secured by our properties. As of June 30, 2026, we had $550,000,000 outstanding, and $850,000,000 remained available under our lines of credit. The weighted average effective interest rate on our outstanding debt, factoring in our interest rate swaps, was 4.23% per annum as of June 30, 2026. See Note 7, Mortgage Loans Payable, and Note 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements.