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Investment Activity | 9 Months Ended
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Sep. 30, 2025
Real Estate [Abstract] |
Investment Activity | Investment Activity Asset Acquisitions During the nine months ended September 30, 2025, we completed the following acquisitions of real estate properties within our Real Estate Investments segment ($ in thousands):
|  |  |  | Number of |  | Asset |  |  |  | Buildings and |  |
Operator |  | Period |  | Properties |  | Class |  | Land |  | Improvements |  | Total
Generations, LLC |  | Q1 2025 |  | 1 |  | SLC |  | $ | 3,062 |  |  | $ | 18,138 |  |  | $ | 21,200 |
Mainstay Healthcare 1 |  | Q1 2025 |  | 1 |  | ALF |  | 2,864 |  |  | 5,736 |  |  | 8,600 |
Juniper Communities, LLC |  | Q1 2025 |  | 1 |  | ALF |  | 4,154 |  |  | 42,130 |  |  | 46,284 |
Agemark Senior Living |  | Q2 2025 |  | 6 |  | ALF |  | 7,461 |  |  | 56,039 |  |  | 63,500 |
|  |  |  |  |  |  |  | $ | 17,541 |  |  | $ | 122,043 |  |  | $ | 139,584 |
1 This property was acquired in a deed in lieu of foreclosure transaction initiated by Senior Living Management (“SLM”) to satisfy the repayment of its $10.0 million mortgage note with us. Reference the “Senior Living Management” section below. In January 2025, we acquired a 108-unit SLC in Montrose, Colorado. The acquisition price was $21.2 million, including $0.2 million in closing costs. The property is leased pursuant to a 10-year triple-net lease, which includes two five-year extension options, an initial lease rate of 8.0% and fixed annual escalators of 2.0%. In March 2025, we acquired a 120-unit ALF and memory care community in Bergen County, New Jersey. The acquisition price was $46.3 million, including $0.3 million in closing costs. The property is leased pursuant to a 15-year triple-net lease, which includes two five-year extension options, an initial lease rate of 8.0% and fixed annual escalators of 2.0%. The lease includes a $0.8 million development commitment which will be added to the respective lease base, if funded. In April 2025, we acquired a portfolio of six ALF and memory care communities located in Nebraska for a total purchase price of $63.5 million, including $0.3 million in closing costs. The portfolio of properties is leased pursuant to a 15-year triple-net master lease, which includes two five-year extension options, an initial lease rate of 8.0% and fixed annual escalators of 2.0%. Discovery Transitions Effective August 1, 2025, we terminated a triple-net master lease associated with a portfolio of six senior housing properties, consisting of four SLCs, one ILF and one ALF, which were held in a consolidated real estate partnership with Discovery Senior Housing Investor XXIV, LLC (the “Discovery partner”). The tenant of the triple-net master lease was a related party of Discovery Senior Living (“Discovery”). In connection with the lease termination, we received net cash consideration of $3.1 million and other non-cash consideration of $0.6 million from the tenant and wrote off the related straight-line rents receivable of $8.9 million on this lease. Each of these amounts was recognized in rental income in our condensed consolidated statements of income for the three and nine months ended September 30, 2025. Additionally, on August 1, 2025, we entered into a dissolution agreement with the Discovery partner, which provided for the write-off of the remaining partnership liabilities against the equity in the partnership and the Discovery partner contributing its 2.0% noncontrolling common equity interest to us for nominal consideration. Concurrently with the activities above, we entered into agreements with an affiliate of Sinceri Senior Living (“Sinceri”) to serve as manager of the properties and transitioned the portfolio of six senior housing properties from our Real Estate Investments segment into our SHOP segment. As of September 30, 2025, the aggregate net carrying value of this portfolio was $125.3 million. Prior to the transition, we recognized rental income of $0.5 million and $3.2 million during the three and nine months ended September 30, 2025, respectively, and $1.5 million and $4.6 million during the three and nine months ended September 30, 2024, respectively, in our condensed consolidated statements of income related to the triple-net master lease. Also, effective August 1, 2025, we terminated a triple-net lease with an affiliate of Discovery for an ILF in Oklahoma. In connection with the lease termination, we received $0.8 million in cash consideration and $0.8 million in other non-cash consideration from the tenant and wrote off the related straight-line rent receivable of $3.2 million on this lease. Each of these amounts was recognized in rental income in our condensed consolidated statements of income for the three and nine months ended September 30, 2025. Concurrently with the lease termination, we transitioned this property from our Real Estate Investments segment into our SHOP segment by contributing it to an existing consolidated partnership with DSHI NHI Holiday LLC (the “Discovery member”). As of September 30, 2025, the net carrying value of this property was $28.6 million. Prior to the transition, we recognized rental income of $0.2 million and $1.6 million during the three and nine months ended September 30, 2025, respectively, and $0.7 million and $2.1 million during the three and nine months ended September 30, 2024, respectively, in our condensed consolidated statements of income related to the triple-net lease. Reference Note 5 for additional information on our SHOP operations. Reference Note 15 for additional information on our segments. Fourth Quarter 2025 Acquisitions On October 1, 2025, we acquired a portfolio of four senior housing communities located in Oklahoma and Oregon, consisting of two SLCs and two ALFs, with a combined total of 344 residential units. The total purchase price of $74.3 million, including $0.5 million in closing costs, was partially funded by the cancellation of a $9.5 million mortgage note with us which had an 8.5% interest rate. This portfolio of properties has been included in our SHOP segment and will continue to be managed by the existing operator, Compass Senior Living. On October 31, 2025, we acquired a 251-unit continuing care retirement community (“CCRC”) located in South Carolina from Senior Living Communities, LLC (“Senior Living”). The acquisition price of $52.5 million was partially funded by the cancellation of a $32.7 million mortgage note on the property. The property is being leased back to Senior Living pursuant to a 15-year triple-net lease with two five-year extension options, an initial lease rate of 8.25% and fixed annual escalators of 2.0%. Concurrently with the acquisition, we executed a $1.5 million revolving line of credit with Senior Living. Reference the “Senior Living Loans” section in Note 4 for additional information on the canceled mortgage note. Impairment of Long-Lived Assets During the three and nine months ended September 30, 2025 and the three months ended September 30, 2024, we did not recognize any impairment charges. During the nine months ended September 30, 2024, we recognized an impairment charge of $0.7 million on one property in our Real Estate Investments segment which was reclassified to assets held for sale in the second quarter of 2024. This property was subsequently sold in the fourth quarter of 2024. Tenant Concentrations The following table presents information related to concentrations of our tenants, or affiliates of tenants, that exceed 10% of total revenues included in our condensed consolidated statements of income for the periods indicated ($ in thousands):
|  |  |  |  | Nine Months Ended
|  |  |  |  | September 30,
| September 30, 2025 |  | 2025 |  | 2024
| Real Estate |  | Mortgages |  |  |  | % of |  |  |  | % of
| Properties 1 |  | and Notes 2 |  | Revenues 3 |  | Total |  | Revenues 3 |  | Total
Senior Living | $ | 578,590 |  |  | $ | 39,450 |  |  | $ | 41,080 |  |  | 15% |  | $ | 39,980 |  |  | 16%
Bickford Senior Living (“Bickford”) | 430,974 |  |  | 15,989 |  |  | 32,141 |  |  | 12% |  | 31,233 |  |  | 13%
National HealthCare Corporation (“NHC”) | 133,770 |  |  | — |  |  | 30,443 |  |  | 11% |  | 30,426 |  |  | 12%
All others, net | 1,406,489 |  |  | 169,173 |  |  | 108,397 |  |  | 41% |  | 99,050 |  |  | 40%
Escrow funds received from tenants for |  |  |  |  |  |  |  |  |  |  |
property operating expenses | — |  |  | — |  |  | 8,411 |  |  | 3% |  | 8,321 |  |  | 3%
Total tenant concentrations | $ | 2,549,823 |  |  | $ | 224,612 |  |  | 220,472 |  |  | 82% |  | 209,010 |  |  | 84%
Resident fees and services 4 |  |  |  |  | 49,333 |  |  | 18% |  | 40,416 |  |  | 16%
Total revenues |  |  |  |  | $ | 269,805 |  |  | 100% |  | $ | 249,426 |  |  | 100%
1 Real estate properties have been stated at their gross carrying values. Total real estate properties, as presented in the table above, exclude $2.6 million related to our corporate office and equipment and exclude $551.8 million related to the properties in our SHOP segment. 2 Mortgages and notes have been stated at their gross carrying values. Mortgages and notes, as presented in the table above, exclude total credit loss reserves of $15.4 million as of September 30, 2025. 3 Revenues, as presented in the table above, include rental income and interest income from assets classified as held for sale, if any. 4 There are no tenant concentrations in revenues from resident fees and services because the residency agreements are between us and the individual residents. As of September 30, 2025, our real estate properties in South Carolina represented 11.0% of our total real estate properties, net, on our condensed consolidated balance sheet. As of December 31, 2024, our real estate properties in South Carolina and Texas represented 11.6% and 10.1%, respectively, of our total real estate properties, net, on our condensed consolidated balance sheet. There were no other states where our concentration in real estate properties was 10% or greater as of September 30, 2025 and December 31, 2024. Senior Living As of September 30, 2025, we leased 10 senior housing properties to Senior Living. We recognized straight-line rent revenue of $(0.5) million and $(0.4) million from Senior Living during the nine months ended September 30, 2025 and 2024, respectively. Bickford As of September 30, 2025, we leased 38 properties to Bickford under four master leases. We have been recognizing revenues from Bickford’s leases on a cash basis since the second quarter of 2022 based upon information we obtained from Bickford regarding its financial condition that raised substantial doubt about its ability to continue as a going concern. During the three and nine months ended September 30, 2025, Bickford repaid $1.2 million and $3.8 million, respectively, of its outstanding rent deferrals, which primarily related to past due payments during the COVID-19 pandemic. During the three and nine months ended September 30, 2024, Bickford repaid $1.1 million and $4.0 million, respectively, of its outstanding rent deferrals. As of September 30, 2025, Bickford’s outstanding rent deferrals totaled $9.1 million. NHC As of September 30, 2025, we leased 32 SNFs and three ILFs to NHC, a publicly held company, under a triple-net master lease. Four of these properties have been subleased to other third parties pursuant to leases in which NHC serves as a guarantor. The triple-net master lease provides for a contingent rent clause that requires NHC to pay additional rent based on 4.0% of the excess, if any, in the annual revenues of the facilities it leases from us over a base amount specified in each lease. During the nine months ended September 30, 2025 and 2024, we recognized straight-line rent revenue of $0.5 million and $0.2 million, respectively, related to NHC. The following table summarizes the portion of our rental income from NHC that was attributable to contingent rent for the periods indicated ($ in thousands):
| Nine Months Ended
| September 30,
| 2025 |  | 2024
Current year | $ | 4,855 |  |  | $ | 4,138 |
Prior year final certifications 1 | 956 |  |  | 1,656 |
Total contingent rental income from NHC | $ | 5,811 |  |  | $ | 5,794 |
1 NHC certifies the annual revenue of its facilities leased from us by March 31 st of the following year. One of the members of our board of directors is also the chairperson of NHC’s board of directors. Cash Basis Tenants We had two tenants, including Bickford, on the cash basis of accounting for revenue recognition during the three and nine months ended September 30, 2025 for their leasing arrangements with us based on our assessment of each tenant’s ability to satisfy its contractual obligations under the terms of the respective leases. During the three and nine months ended September 30, 2024, we had three tenants, including Bickford, on the cash basis of accounting for revenue recognition for their leasing arrangements with us. A summary of lease payments received from cash basis tenants follows ($ in thousands):
| Three Months Ended |  | Nine Months Ended
| September 30, |  | September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Bickford | $ | 10,143 |  |  | $ | 9,850 |  |  | $ | 30,120 |  |  | $ | 29,161 |
All others | 1,498 |  |  | 1,855 |  |  | 4,460 |  |  | 9,398 |
Total lease payments from cash basis tenants | $ | 11,641 |  |  | $ | 11,705 |  |  | $ | 34,580 |  |  | $ | 38,559 |
Senior Living Management SLM was a cash basis tenant from 2022 until January 1, 2025 when the remaining two properties leased from us were transitioned to a new operator who had been serving as the interim manager at the properties. Concurrently with this transaction, we executed a 15-year triple-net master lease with a new operator which includes two five-year extension options. This master lease provides for approximately $1.1 million in initial annual contractual lease payments with fixed annual escalators of 2.0%. In February 2025, we acquired an ALF property in Florida upon the execution of a deed in lieu of foreclosure agreement initiated by SLM to settle its $10.0 million non-performing mortgage note with us. The acquired property was recognized on our condensed consolidated balance sheet at its estimated fair value of $8.6 million, which equaled the net carrying value of the mortgage note. Concurrently, we executed a new lease on this acquired property with the existing operator, Mainstay Healthcare. This lease provides for approximately $0.7 million in annual contractual lease payments. Tenant Purchase and Sale Agreement We lease a SLC that is subject to a purchase and sale agreement giving the tenant the option to acquire the property for $39.0 million. The purchase and sale agreement, as amended, expires in November 2025 subject to monthly renewals through March 2026 by the tenant upon payment of a non-refundable fee. The property was included in real estate properties, net, on our condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024. During the three and nine months ended September 30, 2025, we recognized rental income of $0.6 million and $2.0 million, respectively, related to the existing triple-net lease at this property, which expires in July 2027. During the three and nine months ended September 30, 2024, we recognized rental income of $0.7 million and $2.1 million, respectively, related to the lease on this property. The property will be reclassified to assets held for sale when the sale becomes probable, including when the tenant demonstrates its ability to obtain sufficient financing to close on the sale of the property within the terms of the purchase and sale agreement. As of September 30, 2025, the net carrying value of this property was $18.6 million on our condensed consolidated balance sheet. Tenant Purchase Options Certain of our tenant leases contain a purchase option clause allowing the tenant to acquire the leased property at a fixed base price, a fixed base price plus a specified share in any appreciation of the property or a price based on a specified fixed minimum internal rate of return on our investment. As of September 30, 2025, tenants had purchase options on four of our properties, representing an aggregate net carrying value of $75.3 million, which have exercise dates ranging between 2028 and 2031. Rental income from these properties with tenant purchase options totaled $2.5 million and $7.5 million during the three and nine months ended September 30, 2025, respectively, and $2.5 million and $6.3 million during the three and nine months ended September 30, 2024, respectively. As of September 30, 2025, we cannot reasonably estimate the probability that any of these tenant purchase options will be exercised in the future. Future Minimum Lease Payments The fixed amounts of future minimum lease payments due to us under our existing tenant leases as of September 30, 2025 were as follows ($ in thousands):
Remainder of 2025 | $ | 63,855 |
2026 | 260,738 |
2027 | 211,527 |
2028 | 206,082 |
2029 | 194,682 |
2030 | 194,141 |
Thereafter | 771,076 |
Total | $ | 1,902,101 |
Variable Lease Payments Most of our tenant leases contain annual rent escalators, which may be fixed or variable. Lease payments due to us that are subject to a variable rent escalator are typically determined annually and calculated using a variable index, such as the Consumer Price Index (“CPI”) or an index that is dependent on a future date and indeterminable at the inception of the lease. The following table provides a summary of our rental income with information on our lease payments received during the respective periods that were subject to fixed and variable rent escalators ($ in thousands):
| Three Months Ended |  | Nine Months Ended
| September 30, |  | September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Lease payments based on fixed rent escalators | $ | 63,127 |  |  | $ | 57,682 |  |  | $ | 189,103 |  |  | $ | 174,383 |
Lease payments based on variable rent escalators 1 | 8,110 |  |  | 2,412 |  |  | 14,475 |  |  | 8,663 |
Straight-line rent revenue adjustments, net of write-offs 2 | (10,943) |  |  | 1,161 |  |  | (8,499) |  |  | 2,066 |
Escrow funds received from tenants for |  |  |  |  |  |  |
property operating expenses | 2,610 |  |  | 2,786 |  |  | 8,411 |  |  | 8,321 |
Amortization of lease incentives | (726) |  |  | (723) |  |  | (2,176) |  |  | (2,168) |
Total rental income | $ | 62,178 |  |  | $ | 63,318 |  |  | $ | 201,314 |  |  | $ | 191,265 |
1 Cash and non-cash consideration received by us as a result of the early lease terminations described in the “Discovery Transitions” section above have been included in lease payments based on variable escalators for the three and nine months ended September 30, 2025. 2 The amounts presented for the three and nine months ended September 30, 2025 included the $12.1 million of write-offs of straight-line rents receivable as a result of the early lease terminations described in the “Discovery Transitions” section above.

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