National Healthcare Properties, Inc.

Welcome to the third quarter 2025 webcast for National Healthcare Properties Incorporated. All participants will be in a listen-only mode. Please note, this event is being recorded. Also note that certain statements and assumptions in this webcast presentation, which are not historical facts, will be forward-looking and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain assumptions and risk factors, which could cause the company's actual results to differ materially from the forward-looking statements. The company refers you to its SEC filings, including its most recent Form 10-K, for a detailed discussion of the risk factors that could cause these differences and impacts in its business. During today's call, the company will also discuss certain non-GAAP financial measures. These measures should not be considered in isolation or as a substitution for the financial results prepared in accordance with GAAP. The company will provide a reconciliation of these measures to the most directly comparable GAAP measures as part of its third quarter 2025 materials on its website at www.nhpreit.com. You may submit questions during today's webcast by typing them in the box on the screen and a member of the company's investor relation team will follow up upon the conclusion of this presentation. Also, please note that a copy of this presentation and replay of the webcast will be available on the company's website later today. I would now like to turn the call over to Michael Anderson, Chief Executive Officer and President, and Scott Lappetito, Chief Financial Officer. Please go ahead, Michael.

Good afternoon, and thank you for joining us today. Since our internalization of management in late 2024 and during 2025, we have made significant progress towards preparing NHP for a public listing. This includes improvements in the performance of our assets, increased transparency of our disclosures, significant reduction in corporate leverage, and dispositions of assets that fail to meet our standards of portfolio quality. As we head into the end of 2025 and 2026, we will continue to focus on each of these fronts. During the third quarter, NHP's portfolio delivered year-over-year cash NOI growth of 12.2% on a same-store basis, headlined by same-store growth of 27.2% in our senior housing operating properties, or SHOP, portfolio. This exceptional growth is driven by continued expansion of both occupancy and rate across both our independent living and assisted living facilities. Year-over-year cash NOI growth within our outpatient medical facilities, or OMF, portfolio was also excellent at 4.7% on a same store basis, benefiting from the resumption of operations of the repositioned asset that we'd previously discussed and also optimization of expense recovery. This operating strength led to across the board improvement in both adjusted funds from operation and net leverage. During the third quarter, we also continued discussions with investment banks on the origination of an unsecured corporate credit facility and have made significant progress. We anticipate closing on the facility during the fourth quarter of 2025 or the first quarter of 2026. Once that's complete, we expect to begin preparing for our IPO process, including the confidential submission of our form S11 with the SEC. It's important to remember that the timing of this process is highly dependent on market factors outside of our control. That said, we'll make every effort to keep our existing and future investors informed during the listing process. In closing, we believe that healthcare real estate, especially seniors housing, continues to represent a generational opportunity for investors. We are very excited for the road ahead. Scott, could you please take us through the quarterly financial performance?

Thanks, Michael. During the third quarter, the company generated and redefined funds from operations of $6.7 million, or 23 cents per share, which was an increase of 4 cents over the prior quarter, and adjusted funds from operations of $10.4 million, or $0.36 per share, which was an increase of $0.04 over the prior quarter. These increases were driven primarily by a same-store cash and OI growth. The shop portfolio continues to perform exceptionally, with same-store cash and OI growth totaling a remarkable 27.2% on a year-over-year basis. This growth was driven by continued strength in both census and rate. FameStore average occupancy within the shop portfolio increased 100 basis points relative to the prior quarter to an average rate of 83.7%. Momentum is expected to continue in the fourth quarter, with September spot occupancy coming in at 84.9%. On the rate side, quarterly rev pour grew to $6,125, a 4.5% increase over the same period last year. The OMF portfolio delivered same-store cash and OI growth of 4.7% relative to the prior year, which compares to our portfolio average rent escalator of 2.3%. This outperformance was driven by stable absorption over the last year and an increase in our expense recoveries. The team also remains focused on increasing annual escalators across the portfolio, with 97% of our executed 2025 leases containing an average rent increase of 2.7% and transitioning our leases to a net or absolute net structure, which now represent 81.9% of our OMF leases by square feet. Recurring CapEx investments for the quarter totaled $4.5 million. As a reminder, we report CapEx as it is spent. Turning to the balance sheet, net debt to annualized adjusted EBITDA decreased to 8.9 times. This change was driven by the organic portfolio earnings growth as annualized adjusted EBITDA increased 5% quarter-over-quarter to $112.3 million. As previously announced, we initiated a buyback program of our preferred stock, repurchasing approximately $4.5 million of previously outstanding preferred shares during the second and third quarters at an effective yield of 11.9%. This activity has been accretive to FFO and ASFO and takes advantage of pricing inefficiency in our preferred stock during a time when awareness of our company is low. I would now like to turn the call back to Michael for his closing remarks.

Thank you, Scott, and thanks to all of our investors for joining us today. Please keep an eye on our website for any further updates as available.