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 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.

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 September 30, 2026 and December 31, 2025, together with our results of operations for the three and nine months ended September 30, 2026 and 2025 and cash flows for the nine months ended September 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

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.

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; 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, 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 originate and 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 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.

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 September 30, 2026 and December 31, 2025, we owned 99.2% and 99.0%, respectively, of the operating partnership units, or OP units, in our operating partnership, and the remaining 0.8% and 1.0%, respectively, 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, 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.

Current wording

We currently operate through four reportable business segments: ISHC, SHOP, OM and triple-net leased properties, or Triple-Net Leased Properties. As of September 30, 2026, we owned and/or operated 366 buildings and ISHC, which represent in total approximately 25,437,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $7,426,645,000. In addition, as of September 30, 2026, we originated an aggregate $146,343,000 in notes receivable and had a real estate-related debt security investment purchased for $60,429,000.

Previous 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.

Current wording

During the nine months ended September 30, 2026 and 2025, inflation has affected our operations. The annual rate of inflation in the United States was 3.7% in September 2026 and 3.0% in September 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

In addition, inflation has also caused an increase in the cost of our variable-rate debt due to historically rising interest rates. See Item 3, Quantitative and Qualitative Disclosures About Market Risk — Interest Rate Risk, of this Quarterly Report on Form 10-Q for a further discussion.

Current wording

In addition, inflation has also caused an increase in the cost of our variable-rate debt due to historically rising interest rates. See Item 3, Quantitative and Qualitative Disclosures About Market Risk — Interest Rate Risk, of this Quarterly Report on Form 10-Q for further discussion.

Previous 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.

Current wording

Excluding our ISHC and SHOP, as of September 30, 2026, our properties were 90.3% leased, and, during the remainder of 2026, 1.3% 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, 2026, our remaining weighted average lease term was 6.5 years, excluding our ISHC and SHOP.

Previous 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.

Current wording

Our combined ISHC and SHOP were 90.8% leased as of September 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 and Six Months Ended June 30, 2026 and 2025

Current wording

Comparison of Three and Nine Months Ended September 30, 2026 and 2025

Previous 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):

Current wording

The most significant drivers behind changes in our consolidated results of operations for the three and nine months ended September 30, 2026 compared to the corresponding periods 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 further discussion of our acquisitions and dispositions during 2026. As of September 30, 2026 and 2025, we owned and/or operated the following types of properties (dollars in thousands):

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, 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 nine months ended September 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 related to tenant leases and expense recoveries. The amount of revenues generated by our RIDEA properties depends principally on our ability to maintain resident occupancy rates, adjust resident rent and care fees to market billing rates and optimize the quality of our payor mix. 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 $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.

Current wording

For our ISHC segment, resident fees and services revenue increased by $78,737,000 and $236,316,000, respectively, for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 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 $5,077,000 and $45,484,000, respectively, due to the acquisition in July 2025 of nine senior housing properties located in Ohio, Michigan and Kentucky; and (iii) an increase of $34,977,000 and $104,693,000, respectively, due to the acquisition in December 2025 of 14 senior housing properties located in Ohio, Indiana, New Mexico and North Carolina. In addition, for both the three and nine months ended September 30, 2026, revenue for our ISHC segment included $8,815,000 for certain Ohio Medicaid quality incentive payments received pursuant to Ohio House Bill 479, or HB 479, and related to rate periods prior to 2026. HB 479 was enacted in June 2026 and appropriated funding for nursing facility quality incentive payments.

Previous 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.

Current wording

For our SHOP segment, resident fees and services revenue increased by $90,298,000 and $178,544,000, respectively, for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to: (i) an increase of $1,070,000 and $9,343,000, respectively, due to the acquisition of three senior housing properties in Minnesota and Idaho in the third quarter of 2025; (ii) an increase of $23,850,000 and $69,559,000, respectively, due to the acquisition of 10 senior housing properties in California, Minnesota, Pennsylvania, Utah and Wisconsin in the fourth quarter of 2025; (iii) an increase of $10,680,000 and $25,625,000, respectively, due to the acquisition of seven senior housing properties in California, Kansas and Missouri in the first quarter of 2026; (iv) an increase of $7,591,000 and $13,557,000, respectively, due to the acquisition of seven senior housing properties in Georgia, Minnesota and South Carolina in the second quarter of 2026; (v) an increase of $39,958,000 due to the acquisition of 18 senior housing properties in California, Massachusetts, New Jersey, Pennsylvania, Connecticut, Delaware, Georgia, New York and Virginia in the third 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 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):

Current wording

Our ISHC and SHOP segments typically have a higher percentage of direct operating expenses to revenue than each of our OM and Triple-Net Leased Properties segments 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 $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.

Current wording

For our ISHC segment, total property operating expenses increased by $50,858,000 and $172,444,000, respectively, for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 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 $2,763,000 and $36,080,000, respectively, due to the acquisition in July 2025 of nine senior housing properties located in Ohio, Michigan and Kentucky; and (iii) an increase of $30,915,000 and $93,382,000, 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 $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.

Current wording

For our SHOP segment, total property operating expenses increased by $59,347,000 and $116,062,000, respectively, for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to: (i) an increase of $761,000 and $6,789,000, respectively, due to the acquisitions of three senior housing properties in Minnesota and Idaho in the third quarter of 2025; (ii) an increase of $16,138,000 and $46,103,000, respectively, due to the acquisition of 10 senior housing properties in California, Minnesota, Pennsylvania, Utah and Wisconsin in the fourth quarter of 2025; (iii) an increase of $8,077,000 and $19,100,000, respectively, due to the acquisition of seven senior housing properties in California, Kansas and Missouri in the first quarter of 2026; (iv) an increase of $5,581,000 and $9,817,000, respectively, due to the acquisition of seven senior housing properties in Georgia, Minnesota and South Carolina in the second quarter of 2026; (v) an increase of $26,759,000 due to the acquisition of 18 senior housing properties in California, Massachusetts, New Jersey, Pennsylvania, Connecticut, Delaware, Georgia, New York and Virginia in the third 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 and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, general and administrative expenses increased $4,948,000 and $9,398,000, respectively, primarily due to an increase in stock compensation expense of $2,577,000 and $4,884,000, respectively, and an increase in salaries and benefits expense of $2,244,000 and $3,976,000, respectively.

Current wording

For the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, general and administrative expenses increased $7,474,000 and $16,872,000, respectively, primarily due to an increase in stock compensation expense of $5,855,000 and $10,739,000, respectively, and an increase in salaries and benefits expense of $1,376,000 and $5,353,000, respectively. For both the three and nine months ended September 30, 2026, stock compensation expense includes $4,594,000 related to the accelerated vesting and modification of certain outstanding equity awards in connection with our previously disclosed Chief Executive Officer and Chief Financial Officer transitions during the third quarter of 2026, net of forfeitures.

Previous wording

For the three months ended June 30, 2026 and 2025, depreciation and amortization was $72,125,000 and $41,941,000, respectively, which primarily consisted of depreciation on our operating properties of $46,601,000 and $37,284,000, respectively, and amortization of our identified intangible assets of $24,787,000 and $3,916,000, respectively. For the six months ended June 30, 2026 and 2025, depreciation and amortization was $139,187,000 and $83,055,000, respectively, which primarily consisted of depreciation on our operating properties of $91,357,000 and $73,861,000, respectively, and amortization of our identified intangible assets of $46,355,000 and $7,739,000, respectively.

Current wording

For the three months ended September 30, 2026 and 2025, depreciation and amortization was $90,869,000 and $49,181,000, respectively, which primarily consisted of depreciation on our operating properties of $53,785,000 and $39,644,000, respectively, and amortization of our identified intangible assets of $36,347,000 and $8,799,000, respectively. For the nine months ended September 30, 2026 and 2025, depreciation and amortization was $230,056,000 and $132,236,000, respectively, which primarily consisted of depreciation on our operating properties of $145,142,000 and $113,505,000, respectively, and amortization of our identified intangible assets of $82,702,000 and $16,538,000, respectively.

Previous 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.

Current wording

For the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, depreciation and amortization increased by $41,688,000 and $97,820,000, respectively, primarily attributable to an increase of $27,519,000 and $66,192,000, respectively, in the amortization of in-place lease intangible assets due to property acquisitions since 2025.

Previous 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.

Current wording

The decrease in total interest expense for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, was primarily due to the $2,206,000 and $7,660,000, respectively, decrease in interest expense related to a decrease in debt balances during 2025 and 2026. Such decrease was primarily a result of the paydown of our variable-rate lines of credit and payoff of certain mortgage loans payable using net proceeds raised from our equity offerings during 2025 and cash flow from operations. The decrease in total interest expense for the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, was also driven by: (i) a $2,991,000 change from loss to gain in fair value of derivative financial instruments; (ii) a $1,637,000 decrease in loss on debt extinguishments; and (iii) a $1,346,000 increase in capitalized interest.

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, 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.

Current wording

For the three months ended September 30, 2026, we did not recognize any impairment charges on real estate investments. For the nine months ended September 30, 2026, as we continued to evaluate our properties based on their historical operating performance and our expected holding period, we recognized an aggregate impairment charge of $2,137,000 for two OM buildings. 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 further discussion.

Previous 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.

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 August 2026 Offering (as defined and described in Note 12, Equity — Common Stock, to our accompanying condensed consolidated financial statements), and borrowings under our lines of credit (see the “Credit Facilities” section below). 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 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.

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 September 30, 2026, we had $11,681,000 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, 2026, we estimate that expenditures for capital and tenant improvements as of such date will be approximately $18,788,000 for the remaining three months of 2026, although actual expenditures are predominantly discretionary and are dependent on many factors which are not presently known.

Previous 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.

Current wording

As of September 30, 2026, we are party to a credit agreement, as amended, with an aggregate maximum principal amount up to $1,350,000,000, which may be increased by an aggregate incremental amount (see Note 8, Lines of Credit and Term Loan, for further discussion), 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 further discussion.

Previous 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.

Current wording

As of September 30, 2026, our aggregate borrowing capacity under the 2026 Credit Facility and the 2025 Trilogy Credit Facility was $1,400,000,000. As of September 30, 2026, our aggregate borrowings outstanding under such credit facilities were $550,000,000, and we had $850,000,000 available on such facilities, excluding the $25,000,000 standby letters of credit available pursuant to the 2026 Credit Facility.

Previous 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.

Current wording

For the nine months ended September 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 further discussion.

Previous 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.

Current wording

For the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, the increase in net cash used in investing activities was primarily due to a $1,587,109,000 increase in cash paid to acquire real estate investments, a $140,488,000 increase in originations of notes receivable, a $70,939,000 increase in developments and capital expenditures, as well as a $39,274,000 decrease in proceeds from dispositions of real estate investments.

Previous 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.

Current wording

For the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, the increase in net cash provided by financing activities was primarily due to a $1,819,546,000 increase in gross equity offering proceeds, partially offset by a $22,548,000 increase in distributions paid, a $13,712,000 increase in the payment of equity offering costs and a $13,598,000 increase in payments to taxing authorities in connection with common stock directly withheld from employees.

Previous 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.

Current wording

A significant liquidity need is the payment of principal and interest on our outstanding indebtedness. As of September 30, 2026, we had $830,767,000 of fixed-rate mortgage loans payable outstanding secured by our properties. As of September 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 4.26% per annum as of September 30, 2026. See Note 7, Mortgage Loans Payable, and Note 8, Lines of Credit and Term Loan, to our accompanying condensed consolidated financial statements.

Previous wording

Due to certain unique operating characteristics of real estate companies, the National Association of Real Estate Investment Trusts, or NAREIT, an industry trade group, has promulgated a measure known as funds from operations, a non-GAAP financial measure, which we believe to be an appropriate supplemental performance measure to reflect the operating performance of a REIT. The use of funds from operations is recommended by the REIT industry as a supplemental performance measure, and our management uses FFO to evaluate our performance over time. FFO is not equivalent to our net income (loss) as determined under GAAP.

Current wording

Due to certain unique operating characteristics of real estate companies, the National Association of Real Estate Investment Trusts, or NAREIT, an industry trade group, has promulgated a measure known as funds from operations, or FFO, a non-GAAP financial measure, which we believe to be an appropriate supplemental performance measure to reflect the operating performance of a REIT. The use of FFO is recommended by the REIT industry as a supplemental performance measure, and our management uses FFO to evaluate our performance over time. FFO is not equivalent to our net income (loss) as determined under GAAP.

Previous wording

Our FFO calculation complies with NAREIT’s policy, under which we define FFO, a non-GAAP financial measure, as net income (loss) computed in accordance with GAAP, excluding gains or losses from sales of certain real estate assets, gains or losses upon consolidation of a previously held equity interest, and impairment writedowns of certain real estate assets and investments, plus depreciation and amortization related to real estate, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect funds from operations.

Current wording

Our FFO calculation complies with NAREIT’s policy, under which we define FFO as net income (loss) computed in accordance with GAAP, excluding gains or losses from sales of certain real estate assets, gains or losses upon consolidation of a previously held equity interest, and impairment writedowns of certain real estate assets and investments, plus depreciation and amortization related to real estate, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO.

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): 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.

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 direct origination and closing costs on debt 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

However, FFO and Normalized FFO should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income (loss) as an indicator of our operating performance, GAAP cash flows from operations as an indicator of our liquidity or indicative of funds available to fund our cash needs, including our ability to make distributions to our stockholders. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP FFO and Normalized FFO measures and the adjustments to GAAP in calculating FFO and Normalized FFO. Presentation of this information is intended to provide useful information to investors, industry analysts and management as they compare the operating performance used by the REIT industry, although it should be noted that not all REITs calculate funds from operations and normalized funds from operations the same way, so comparisons with other REITs may not be meaningful. FFO and Normalized FFO should be reviewed in conjunction with other measurements as an indication of our performance. None of the SEC, NAREIT, or any other regulatory body has passed judgment on the acceptability of the adjustments that we use to calculate FFO or Normalized FFO.

Current wording

However, FFO and Normalized FFO should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income (loss) as an indicator of our operating performance, GAAP cash flows from operations as an indicator of our liquidity or indicative of funds available to fund our cash needs, including our ability to make distributions to our stockholders. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP FFO and Normalized FFO measures and the adjustments to GAAP in calculating FFO and Normalized FFO. Presentation of this information is intended to provide useful information to investors, industry analysts and management as they compare the operating performance used by the REIT industry, although it should be noted that not all REITs calculate FFO and normalized FFO the same way, so comparisons with other REITs may not be meaningful. FFO and Normalized FFO should be reviewed in conjunction with other measurements as an indication of our performance. None of the SEC, NAREIT, or any other regulatory body has passed judgment on the acceptability of the adjustments that we use to calculate FFO or Normalized FFO.