Healthpeak Properties, Inc.

Good morning and welcome to the HealthPeak Properties, Inc. fourth quarter 2025 conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then one. Please note this event is being recorded. I would now like to turn the conference over to Andrew Johns, Senior Vice President, Investor Relations. You may begin.

Welcome. Today's conference call contains certain forward-looking statements. Although we believe expectations reflected in any forward-looking statements are based on reasonable assumptions, these statements are subject to risks and uncertainties that may call actual results to differ materially from expectations. The discussion of risk and risk factors is included in our press release in detail in our findings with the SEC. We do not undertake a duty to update any forward-looking statements. Certain non-GAAP financial measures we discussed on this call, an exhibit that the 8K referred to the SEC yesterday, we have reconciled all non-GAAP financial measures to the most directly comparable GAAP measures in accordance with Reg G requirements. The exhibit is also available on our website at healthpeak.com. I'll now turn the call over to our President and Chief Executive Officer, Scott Brinkman.

Thanks, AJ, and welcome to HealthPeak's fourth quarter earnings call. Joining me for prepared remarks is our CFO, Kelvin Moses. First and most important, thank you to our entire team for battling through an historic life science environment to finish 2025 with earnings in line with the midpoint of our original guidance range and significant transaction activity that should drive future earnings growth. A couple of comments on our segments. Outpatient medical represents just over 50% of our portfolio income. Kelvin will discuss our outstanding operating results in that segment, but I want to make some more general comments, including the benefits of the merger with Physicians Realty Trust. That merger created the best platform and portfolio in the outpatient sector and positioned us to quickly and profitably internalize property management across our entire outpatient and life science portfolio. Seventy plus million dollars of synergies certainly helped offset the life science environment. The outpatient sector is benefiting from the ongoing shift in care delivery to lower cost, more convenient outpatient settings. Policy changes from Washington also support demand. including CMS allowing more and more surgeries to be done in outpatient settings. And new supply continues to be very low given the cost of new construction. All of the above contribute to the favorable operating environment we spoke to when we announced the merger two and a half years ago. The private market is now recognizing this as well, which is driving down cap rates. We're taking advantage of that demand by selling fully stabilized, less core outpatient assets at strong prices. including $325 million in the fourth quarter at a low 6% cap rate. Turning to our lab segment, the operating environment over the past four years peaked in intensity in the first half of 2025, which is now fully impacting earnings. But in the last five months, we've seen continued improvement in capital raising and M&A. New deliveries will soon go to zero and will remain at zero for several years. Certain life science buildings are pivoting to alternative uses, which helps address the supply overhang. All of the above points to early signs of an inflection point. Naturally, earnings will lag the underlying recovery because of the time to build a pipeline, sign leases, and build off the space before rent commences. But the building blocks of a recovery are in place. Four years ago, we had the opposite view of the trajectory in the sector, and this team chose to cut off capital deployment in life science. which at the time was by far our largest business segment. That decision, combined with the merger and related synergies, has allowed us to grow the dividend and maintain earnings since 2022 when the downturn began, a significant accomplishment given the severity of the environment we've been up against. As the sector recovers, we now have opportunities to acquire properties that would have been untouchable in the past and to do so on a compelling basis. While others in the sector are retrenching, We're strengthening our portfolio and platform, including the recent Gateway acquisition and hiring Dennis Sullivan to lead San Diego and Claire Brown to lead Boston. Our team was working hard over the new year. In late December and early January, we closed the outpatient medical sales and recycled that capital into a highly strategic 1.4 million square foot campus in South San Francisco. We see potential for significant upside as the sector recovers. as the campus has more than 500,000 square feet of vacancy in a prime location. We now own and control 210 acres in South San Francisco, which is roughly one-third of the land in the entire submarket. We own 6.5 million square feet of space at various sizes and price points, so we can provide unmatched solutions to current and future tenants. A recent report from a leading brokerage firm showed the Bay Area led all life science markets in the fourth quarter and full year 2025, in absorption and leasing activity and has the largest volume of current tenant demand. That broker report is consistent with our own leasing activity and pipeline and further supports the acquisition. Moving to senior housing, our fourth quarter results were outstanding with 17% same store growth. We point to three factors driving the growth. First, our highly amenitized full continuum campuses that resonate with seniors. second our asset management team collaborates with our operating partners to develop and execute property specific business plans and third favorable supply and demand fundamentals we expect all three factors to drive another year of strong growth in 2026. okay i want to comment on the janus living announcement from january 7. our senior housing portfolio has been operating at a very high level but was largely ignored inside healthy given its relative scale In addition, we have significant expertise and relationships in the sector to valuable resources that were being underutilized. Over the past several quarters, with a singular focus on generating shareholder value, we worked alongside our board and advisors to review a range of strategic alternatives to the status quo. We chose to pursue the creation of a pure play senior housing REIT. We believe the planned IPO is a unique and creative way to capture value in the near term through a higher multiple on our senior housing NOI and as a significant shareholder in Janus Living to participate in future value creation from internal and external growth. The transaction can be summarized as follows. HealthBeak intends to contribute its entire senior housing portfolio to Janus Living in exchange for all the shares in the new company. Shares in the new company will be sold to the public in the IPO, which will dilute HealthPeak's ownership. Janus Living will own 100% of its properties in a Radea structure. HealthPeak will be the manager for Janus Living, with strong alignment given our ownership interest in the new company. Simply put, our economics will be driven by Janus Living's operating results and stock price. Since making the announcement in January, we closed on the purchase of our joint venture partner's 46.5% interest, in a 3,400 unit senior housing portfolio for $314 million. We now have full control of those 19 communities. Over the next few months, we expect to transition 11 communities to Pegasus Senior Living and eight communities to CL Senior Living under highly aligned management contracts. We have long and successful relationships with the principals of each company. Both Pegasus and CL have successfully underwritten and executed operator transitions, and they have strong track records in these regions. We have $360 million of additional relationship-driven acquisitions in our senior housing pipeline. These are newer vintage assets located in high-growth markets in Orlando and the northern suburbs of Atlanta, both markets that we know very well. We expect the acquisitions will close in the first quarter and be contributed to Janus Living. We're excited to add Jonathan Hughes to our team as SVP of Finance and Investor Relations. Jonathan knows the sector well and will lead our efforts with the street at Janus Living, while Andrew Johns will continue to lead that effort at HealthPeak. In terms of timing, we filed a confidential S11 with the SEC in December. The SEC process will determine the ultimate timing of the IPO, but our current expectation is to close the offering in the first half of this year. I'll turn it to Kelvin to review our 2025 results and 2026 outlook.