Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2026
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition period from ____ to ____
Commission file number 1-11314
LTC PROPERTIES, INC.
(Exact name of Registrant as specified in its charter)
Maryland
71-0720518
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
3011 Townsgate Road, Suite 220
Westlake Village, California 91361
(Address of principal executive offices, including zip code)
(805) 981-8655
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol(s)
Name of each exchange on which registered
Common stock, $.01 par value
LTC
New York Stock Exchange
Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☑
Accelerated filer ☐
Non-accelerated filer ☐
Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☑
The number of shares of common stock outstanding on October 28, 2026 was 56,191,669.
September 30, 2026
INDEX
PART I -- Financial Information
Page
Item 1.
Financial Statements
3
Consolidated Balance Sheets
Consolidated Statements of Income
4
Consolidated Statements of Comprehensive Income
5
Consolidated Statements of Equity
6
Consolidated Statements of Cash Flows
7
Notes to Consolidated Financial Statements
8
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
38
Item 3.
Quantitative and Qualitative Disclosures about Market Risk
63
Item 4.
Controls and Procedures
PART II -- Other Information
Legal Proceedings
64
Item 1A.
Risk Factors
Unregistered Sales of Equity Securities and Use of Proceeds
65
Item 5.
Other Information
Item 6.
Exhibits
66
Available Information
We make available to the public free of charge through our internet website at www.LTCreit.com our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the Securities and Exchange Commission (“SEC”). We also use the “Investors” portion of our www.LTCreit.com website for purposes of compliance with Regulation FD and as a routine channel for distribution of important information to investors and interested parties, including news releases, analyst presentations, financial information, and corporate governance practices. Accordingly, investors and interested parties should monitor the “Investors” portion of our www.LTCreit.com website for the release of this information. Information on our website is not part of this Quarterly Report on Form 10-Q or any of our filings with the SEC unless specifically incorporated by reference.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except per share)
December 31, 2025
(unaudited)
(audited)
ASSETS
Investments:
Land
$
145,778
128,590
Buildings and improvements
1,940,985
1,482,075
Accumulated depreciation and amortization
(311,498)
(408,906)
Owned real properties, net
1,775,265
1,201,759
Financing receivables, net of credit loss reserve: 2026—$2,875; 2025—$3,631
284,656
359,457
Mortgage loans receivable, net of credit loss reserve: 2026—$4,002; 2025—$3,849
396,832
381,662
Real property investments, net
2,456,753
1,942,878
Notes receivable, net of credit loss reserve: 2026—$250; 2025—$259
24,775
25,615
Investments in unconsolidated joint ventures
—
12,524
Investments, net
2,481,528
1,981,017
Other assets:
Cash and cash equivalents
182,983
14,387
Debt issue costs related to revolving line of credit
5,639
4,742
Interest receivable
25,274
22,720
Straight-line rent receivable
15,979
17,949
Prepaid expenses and other assets
43,845
21,245
Total assets
2,755,248
2,062,060
LIABILITIES
Revolving line of credit
429,900
252,863
Term loans, net of debt issue costs: 2026—$1,530; 2025—$1,787
198,470
198,213
Senior unsecured notes, net of debt issue costs: 2026—$776; 2025—$895
356,724
391,105
Accrued interest
1,719
3,806
Accrued expenses and other liabilities
60,579
53,689
Total liabilities
1,047,392
899,676
EQUITY
Stockholders’ equity:
Common stock: $0.01 par value; 110,000 shares authorized; shares issued and outstanding: 2026—54,820; 2025—48,482
548
485
Capital in excess of par value
1,426,948
1,189,846
Cumulative net income
2,244,783
1,843,407
Accumulated other comprehensive income
11,568
482
Cumulative distributions
(2,049,066)
(1,959,236)
Total LTC Properties, Inc. stockholders’ equity
1,634,781
1,074,984
Non-controlling interests
73,075
87,400
Total equity
1,707,856
1,162,384
Total liabilities and equity
See accompanying notes.
CONSOLIDATED STATEMENTS OF INCOME
(amounts in thousands, except per share, unaudited)
Three Months Ended
Nine Months Ended
September 30,
2026
2025
Revenues:
Resident fees and services
70,539
22,203
176,256
34,153
Rental income
27,505
27,842
79,834
89,463
Interest income from financing receivables
5,644
7,096
19,539
21,182
Interest income from mortgage loans
10,389
9,856
30,933
28,715
Interest and other income
1,169
2,293
2,954
5,048
Total revenues
115,246
69,290
309,516
178,561
Expenses:
Seniors housing operating expenses
50,808
17,362
129,905
26,781
Interest expense
11,312
8,791
31,578
24,718
Depreciation and amortization
13,718
8,987
38,068
26,925
Impairment loss
2,310
Write-off of effective interest receivable
41,455
Provision (recovery) for credit losses
47
203
(610)
3,642
Transaction costs
1,165
587
3,042
7,734
Triple-net lease property tax expense
1,987
2,581
6,482
8,483
General and administrative expenses
8,125
7,523
24,868
22,941
Total expenses
89,472
87,489
235,643
162,679
Income (loss) before unconsolidated joint ventures, real estate dispositions and other items
25,774
(18,199)
73,873
15,882
Gain (loss) on sale of real estate, net
323,948
(738)
331,500
(235)
Income from unconsolidated joint ventures
439
396
4,543
Income tax (provision) benefit
(398)
(42)
(674)
39
Net income (loss)
349,324
(18,540)
405,095
20,229
Income allocated to non-controlling interests
(1,178)
(1,455)
(3,719)
(4,452)
Net income (loss) attributable to LTC Properties, Inc. stockholders
348,146
(19,995)
401,376
15,777
Income allocated to participating securities
(1,772)
(154)
(2,117)
(471)
Net income (loss) available to common stockholders
346,374
(20,149)
399,259
15,306
Earnings per common share:
Basic
6.44
(0.44)
7.77
0.33
Diluted
6.39
7.70
Weighted average shares used to calculate earnings per common share:
53,763
46,123
51,412
45,726
54,208
51,852
46,107
Dividends declared and paid per common share
0.57
1.71
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(amounts in thousands, unaudited)
Three Months Ended September 30,
Nine Months Ended September 30,
Unrealized gain (loss) on cash flow hedges before reclassification
8,480
54
12,216
(4)
Gains reclassified from accumulated other comprehensive income to interest expense
(321)
(784)
(1,130)
(2,352)
Comprehensive income (loss)
357,483
(19,270)
416,181
17,873
Less: Comprehensive income allocated to non-controlling interests
Comprehensive income (loss) attributable to LTC Properties, Inc.
356,305
(20,725)
412,462
13,421
CONSOLIDATED STATEMENTS OF EQUITY
Capital in
Cumulative
Total
Non-
Common Stock
Excess of
Net
Accumulated
Stockholder's
Controlling
Shares
Amount
Par Value
Income
OCI
Distributions
Equity
Interests
Balance—December 31, 2024
45,511
455
1,082,764
1,725,435
3,815
(1,851,842)
960,627
92,378
1,053,005
Issuance of common stock
238
2
8,409
8,411
Issuance of restricted stock
114
1
(1)
Common stock cash distributions ($0.57 per share)
(27,259)
Stock-based compensation expense
2,253
Net income
20,680
1,541
22,221
Vesting of performance-based stock units
163
(2)
Fair market valuation adjustment for interest rate swap
(910)
Cash paid for taxes in lieu of common shares
(138)
(4,771)
(4,772)
Acquisitions of non-controlling interest
2,883
(4,033)
(1,150)
Non-controlling interest distributions
(2,486)
Other
(11)
Balance—March 31, 2025
45,888
459
1,091,524
1,746,115
2,905
(1,879,101)
961,902
1,049,302
149
5,167
5,169
21
(26,297)
2,795
15,092
1,456
16,548
20
(717)
(13)
(437)
(1,456)
Balance—June 30, 2025
46,065
461
1,099,049
1,761,207
2,188
(1,905,398)
957,507
1,044,907
1,268
12
45,371
45,383
(26,456)
2,140
Net (loss) income
1,455
(729)
Balance—September 30, 2025
47,333
473
1,146,560
1,741,212
1,459
(1,931,854)
957,850
1,045,250
Balance—December 31, 2025
48,482
1,146
11
43,283
43,294
130
(29,171)
2,064
23,593
1,363
24,956
171
1,074
(150)
(5,874)
(5,875)
(15,688)
(12)
Balance—March 31, 2026
49,779
498
1,229,304
1,867,000
1,556
(1,988,407)
1,109,951
1,183,026
4,112
41
154,529
154,570
15
(29,781)
2,326
29,637
1,178
30,815
1,853
Balance—June 30, 2026
53,906
539
1,386,159
1,896,637
3,409
(2,018,188)
1,268,556
1,341,631
914
9
38,504
38,513
(30,878)
2,285
8,159
Balance—September 30, 2026
54,820
CONSOLIDATED STATEMENTS OF CASH FLOWS
OPERATING ACTIVITIES:
Adjustments to reconcile net income to net cash provided by operating activities:
6,675
7,188
(Gain) loss on sale of real estate, net
(331,500)
235
Deferred income tax provision (benefit)
674
(39)
(396)
(4,543)
Income distributions from unconsolidated joint ventures
494
4,578
Straight-line rental adjustment
696
1,447
Adjustment for collectability of straight-line rental income
1,514
Adjustment for collectability of lease incentives
13
249
Effective interest income
(1,728)
(2,194)
Amortization of lease incentives
363
556
(Recovery) provision for credit losses
Amortization of debt issue costs
1,738
1,191
Other non-cash items, net
Change in operating assets and liabilities
Increase in interest receivable
(5,014)
(4,903)
(Decrease) increase in accrued interest payable
(2,087)
915
Net change in other assets and liabilities
(8,377)
Net cash provided by operating activities
106,422
98,038
INVESTING ACTIVITIES:
Investment in real estate properties
(737,890)
(268,169)
Investment in real estate capital improvements
(11,160)
(6,673)
Proceeds from sale of real estate, net
469,928
5,714
Investment in financing receivables
(373)
(777)
Proceeds from the sale of properties accounted for as a financing receivable
62,220
Investment in real estate mortgage loans receivable
(15,542)
(99,200)
Principal payments received on mortgage loans receivable
680
21,731
(34)
(740)
Proceeds from liquidation of investments in unconsolidated joint ventures
12,558
13,000
Advances and originations under notes receivable
(25)
Principal payments received on notes receivable
849
18,039
Net cash used in investing activities
(218,764)
(317,100)
FINANCING ACTIVITIES:
Net borrowings under revolving line of credit
177,037
404,100
Repayment of debt
(34,500)
(144,500)
Proceeds from common stock issued
236,790
59,316
Payments of common share issuance costs
(413)
(353)
Distributions paid to stockholders
(89,830)
(80,012)
Acquisition of and distributions paid to non-controlling interests
(1,188)
Financing costs paid
(2,259)
(4,562)
Cash paid for taxes in lieu of shares upon vesting of long-term equity incentives
(5,209)
Net cash provided by financing activities
280,938
227,581
Increase in cash and cash equivalents
168,596
8,519
Cash and cash equivalents, beginning of period
9,414
Cash and cash equivalents, end of period
17,933
Supplemental disclosure of cash flow information:
Interest paid
31,927
22,612
Non-cash investing and financing transactions:
615
Investment in mortgage loans receivable
469
Write-off of notes receivable
(2,693)
Increase (decrease) in fair value of interest rate swap agreements
11,086
(2,356)
Distributions paid to non-controlling interests
(5,359)
Transfer of joint venture partner's non-controlling interest to LTC
Distributions to non-controlling interests related to sale of properties accounted for as a financing receivable
(14,325)
1.
Description of Business
The Company
LTC Properties, Inc. (“LTC” or the “Company”), a health care real estate investment trust (“REIT”), was incorporated on May 12, 1992 in the State of Maryland and commenced operations on August 25, 1992. We invest primarily in seniors housing and health care properties primarily through our owned seniors housing operating portfolio (“SHOP”), triple-net leases and joint ventures. Our primary objectives are to create, sustain and enhance stockholder equity value and provide current income for distribution to stockholders through real estate investments in seniors housing and health care properties managed by experienced operators.
Investment Portfolio
Our goal is to invest in properties that provide an opportunity for additional value and current returns to our stockholders and diversify our investment portfolio by geographic location and operator.
As of September 30, 2026, our total gross investment portfolio included owned real properties subject to non-cancellable triple-net leases (“NNN” or “Triple-Net Portfolio”) (25.5%), SHOP (49.0%), properties we own accounted for as financing receivables (10.3%), mortgage loans receivable secured by first mortgages (14.3%) and notes receivable (0.9%).
Property Types
Our seniors housing and health care property classifications include independent living communities, assisted living communities, memory care communities and combinations thereof and skilled nursing centers (“SNF”). Independent living communities, assisted living communities, memory care communities and combinations thereof are included in the seniors housing communities classification (“SH”). We also have investments in other (“OTH”) types of properties, such as land parcels, projects under development (“UDP”) and a behavioral health care hospital. Any reference to the number or type of properties or facilities, number of units, number of beds, number of operators and yield on investments in real estate are unaudited and outside the scope of our independent registered public accounting firm’s review of our consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board.
2.
Basis of Presentation and Accounting Policies
Basis of Presentation
We have prepared consolidated financial statements included herein without audit and in the opinion of management have included all adjustments necessary for a fair presentation of the consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to rules and regulations governing the presentation of interim financial statements. The results of operations for the three and nine months ended September 30, 2026 and 2025 are not necessarily indicative of the results for a full year.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of our company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
Use of Estimates
Preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Our most significant assumptions and estimates are related to the valuation of real estate, purchase price allocation of acquired assets, revenue recognition including the collectability of tenant receivables and asset impairment.
Segments
During the second quarter of 2025, we began utilizing the structure authorized by the REIT Investment Diversification and Empowerment Act of 2007 (commonly referred to as “RIDEA”) as permitted by the Housing and Economic Recovery Act of 2008. Under RIDEA, REITs are permitted to participate directly in the cash flow of qualified healthcare properties (compared to receiving solely contractual rental income). Accordingly, effective in the second quarter of 2025, we conduct and manage our business as two operating segments, for reporting and decision-making purposes: i) real estate investments segment (“Real Estate Investments Segment”) which consists of our Triple-Net Portfolio, financing receivables, mortgage loans, notes receivable and unconsolidated joint ventures and ii) SHOP segment. See Note 17-Segment Information for more information.
3.
Owned Real Properties
Our owned real properties include 58 properties within our Triple-Net Portfolio leased to 12 different operators and 46 properties within our SHOP segment managed on our behalf by 13 independent operators under separate management agreements. The following tables summarize our investments in owned properties at September 30, 2026 (dollar amounts in thousands):
NNN
SHOP
Percentage
Number
Gross
of
Type of Property
Investment
Properties (1)
Seniors Housing
379,841
18.2
%
33
1,372,831
65.8
46
1,752,672
84.0
79
Skilled Nursing
322,086
15.4
24
Other (2)
12,005
0.6
Total (3)
713,932
34.2
58
2,086,763
100.0
104
Average
Number of
SNF
SH
per
Beds
Units
Bed/Unit
Seniors Housing-NNN
2,233
170.10
Seniors Housing-SHOP
4,097
335.08
6,330
276.88
2,707
143
113.01
118
n/a
2,825
6,473
Owned Real Properties–SHOP
During the second quarter of 2025, we began utilizing the RIDEA structure and established a SHOP segment. Following the establishment of our SHOP segment, during the second through fourth quarters of 2025, we acquired 11 seniors housing communities within the SHOP segment. Additionally, we terminated triple-net master leases with three operators and converted 15 seniors housing communities covered under the master leases into our SHOP segment. Upon conversion into the SHOP segment, two of these communities are operating and accounted for as one community.
During the nine months ended September 30, 2026, we continued to expand our SHOP segment. Accordingly, we acquired 17 seniors housing communities within our SHOP segment for $737,281,000. See Acquisitions below for more information. Also, we terminated two additional triple-net master leases and converted four seniors housing communities covered under these master leases into our SHOP segment. Upon conversion, we entered into management agreements with two operators new to us. The communities are located in Georgia, South Carolina and Texas (2) with a total of 247 units and an aggregate gross book value of $59,901,000. As of September 30, 2026, our SHOP segment represented 49.0% of our gross portfolio investments and was comprised of 46 seniors housing communities managed on our behalf by 13 independent operators pursuant to separate management agreements.
10
The following table presents information related to our SHOP segment as of September 30, 2026 (dollar amounts in thousands):
State
Properties
Unit
Minnesota
296,103
668
443.27
Wisconsin
289,886
889
326.08
Georgia
149,804
552
271.38
Colorado
82,049
292
280.99
Florida
69,061
140
493.29
Illinois
68,304
325
210.17
Arizona
54,621
525.20
California
49,209
133
369.99
45,483
68
668.87
Virginia
43,742
62
705.52
All Other
224,569
864
259.92
Purchase
Price
Alabama
70,950
180
61,500
117
Pennsylvania
52,000
Iowa
23,825
85
Totals
208,275
512
Acquisitions
During the nine months ended September 30, 2026 and 2025, we acquired the following communities within our SHOP segment (dollar amounts in thousands):
Transaction
Acquisition
Year
State (1)
Price (1)
Costs
Costs (1)
Beds/Units (1)
295,351
748
296,099
108,000
192
108,192
394
68,975
82
69,057
54,250
54,308
43,610
132
45,390
93
40,000
126
40,126
147
39,875
123
39,998
New Mexico
32,625
109
32,734
69
9,205
9,287
61
737,281
1,745
739,026
17
1,777
194,050
165
194,215
520
Kentucky
39,500
184
39,684
158
35,200
247
35,447
67
268,750
596
269,346
(3)
745
The total acquisition costs allocated to SHOP assets acquired during the nine months ended September 30, 2026 and 2025 were as follows (in thousands):
35,842
12,884
703,184
256,462
Total acquisition costs
Capital Improvement Projects
During the nine months ended September 30, 2026 and 2025, we funded capital improvement projects of $9,746,000 and $2,425,000 respectively, within our SHOP segment.
Owned Real Properties–Triple-Net Portfolio
Our Triple-Net Portfolio includes owned properties that are leased pursuant to non-cancelable triple-net operating leases. Triple-net leases require the lessee to pay all taxes, insurance, maintenance and repairs, capital and non-capital expenditures and other costs necessary in the operations of the facilities.
The majority of our triple-net leases contain provisions for specified annual increases over the rents of the prior year.
Lease Extensions
Many of the triple-net leases contain renewal options that, if exercised, could result in the amount of rent payable upon renewal being greater than that currently being paid. The following table provides information related to our triple-net lease extensions during the nine months ended September 30, 2026 and 2025 (dollar amounts in thousands):
Original
Extended
Beds/Units
Maturity
83,293
266
CO, NJ
December 31, 2027
December 31, 2032
68,767
IL, MI, OH
May 31, 2026
May 31, 2027
39,483
CA
February 28, 2027
June 30, 2031
9,052
155
OK
October 31, 2026
October 31, 2030
2026 Total
200,595
18
1,062
May 31, 2025
53,339
782
AL, NM
April 30, 2026
April 30, 2031
32,361
159
GA, SC
December 31, 2026
25,704
88
TX
February 28, 2025
February 28, 2026
13,053
211
SC
February 28, 2031
5,275
141
TN
2025 Total
198,499
1,842
Lease Terminations
During the nine months ended September 30, 2026, we terminated two triple-net master leases and converted four seniors housing communities covered under the master leases into our SHOP segment. Upon conversion, we entered into management agreements with two independent operators. The communities are located in Georgia, South Carolina and Texas (2) with a total of 247 units and an aggregate gross book value of $59,901,000.
Additionally, as a result of the sale of 19 skilled nursing centers and 17 seniors housing communities within our Triple-Net Portfolio, we terminated master lease agreements with five operators during the nine months ended September 30, 2026. In connection with the sale of 17 seniors housing communities, we received a lease termination fee of $2,581,000 during the nine months ended September 30, 2026. See Properties Sold below for more information.
During the nine months ended September 30, 2025, we terminated two existing leases with the same operator and combined them into a single master lease. The new master lease had a five-year term with one 1-year extension option and four 5-year extension options. In connection with the termination of these leases, we wrote-off straight-line rent receivable and lease incentive balances of $243,000 and $249,000, respectively. During the fourth quarter of 2025, we terminated the new master lease and converted the communities covered under the master lease into our SHOP segment.
Also, during the nine months ended September 30, 2025, we terminated our Anthem Memory Care LLC (“Anthem”) triple-net master leases and converted the communities covered under the master leases into our SHOP segment. In conjunction with the conversion, we wrote-off Anthem’s working capital note of $2,693,000 and the related interest receivable of $371,000 during the nine months ended September 30, 2025. In addition, we terminated our triple-net lease with New Perspective Senior Living, LLC (“New Perspective”) and converted the community covered under the lease into our SHOP segment. In connection with the conversion, we paid New Perspective a $5,971,000 lease termination fee.
Components of Rental Income
The following table summarizes components of our rental income for the three and nine months ended September 30, 2026 and 2025 (in thousands):
Rental Income
Contractual cash rental income
25,602
27,079
74,325
84,781
Variable cash rental income (2)
2,117
2,582
6,581
8,448
Straight-line rent adjustment
(98)
(372)
(696)
(1,447)
Adjustment of lease incentives and rental income
(1,271)
(1,763)
(5)
(116)
(176)
(363)
(556)
We monitor the collectability of our receivable balances, including deferred rent receivable balances, on an ongoing basis. For leases where we have concluded it is not probable that we will collect substantially all the lease payments under those leases, recognition of rental income is limited to the lesser of the amount of cash collected or rental income reflected on a straight-line basis. We write-off uncollectible operator receivable balances, including straight-line rent receivable and lease incentives balances, as a reduction to rental income in the period such balances are no longer probable of being collected. During the nine months ended September 30, 2026, we wrote-off lease incentive balance of $13,000, in connection with the termination of a master lease and converting the communities covered under the master lease into our SHOP segment. During the nine months ended September 30, 2025, we wrote-off straight-line rent receivable balance of $1,271,000 in connection with the on-going Genesis Chapter 11 bankruptcy filing. During the three months ended March 31, 2026, a federal bankruptcy judge approved the sale of Genesis’ assets to a newly formed investment group. The sale of Genesis’ assets, including the leasehold interest in our properties closed in October 2026, and the lease was assumed on its terms by an affiliate of 101 W State Street Holdings, LLC. Additionally, during the nine months ended September 30, 2025, we wrote-off straight-line rent receivable and lease incentive balances of $243,000 and $249,000, respectively, in connection with the termination of two existing leases with the same
14
operator, and combining them into a master lease as discussed above.
We continue to take into account the current financial conditions of our operators in our estimation of uncollectible accounts and deferred rents receivable and closely monitor the collectability of such rents, adjusting future estimates as necessary.
Purchase Options
Some of our triple-net lease agreements provide purchase options allowing the lessees to purchase the properties they currently lease from us. The following table summarizes information about purchase options included in our lease agreements as of September 30, 2026 (dollar amounts in thousands):
Type
Option
Net Book
Window
Property
Investments (1)
Value
2027-2029
Oklahoma
2,809
Texas
52,726
46,516
2029
North Carolina
15,239
6,470
77,017
55,795
See Note 4. Financing Receivables for purchase options included in our financing receivable agreements.
Improvement Projects
During the nine months ended September 30, 2026 and 2025, we invested in the following capital improvement projects within our Triple-Net Portfolio (dollar amounts in thousands):
Seniors Housing Communities
1,034
2,648
Skilled Nursing Centers
380
1,600
1,414
4,248
Impairment Loss
As of September 30, 2026, we identified indicators of impairment and performed recoverability analysis on the carrying value of the community listed in the table below and concluded that its carrying value will not be recoverable through future undiscounted cash flows. We did not identify any indicators of impairment during the nine months ended September 30, 2025. The following table summarizes information regarding impairment losses recorded during the nine months ended September 30, 2026 (dollar amounts in thousands):
Impairment
Loss
South Carolina
87
Properties Sold
During the nine months ended September 30, 2026, we recognized a net gain on sale of real estate of $331,500,000. During the nine months ended September 30, 2025, we recognized a net loss on sale of real estate of $235,000. The following table summarizes property sales during the nine months ended September 30, 2026 and 2025 (dollar amounts in thousands):
Sales
Carrying
Gain (Loss) (1)
Colorado, Kansas, Ohio, Texas
738
157,419
28,193
129,109
613
103,000
6,693
95,722
1,750
166,900
100,859
66,001
Oregon
99
34,200
739
33,135
Tennessee
9,500
1,944
7,550
(17)
36
3,341
471,019
138,428
Ohio (4)
1,800
1,342
340
Ohio
1,000
670
236
29
(96)
2,880
3,266
(715)
6,350
5,948
4.
Financing Receivables
We have entered into joint venture (“JV”) agreements and contributed into these JVs for the purchase of properties through sale and leaseback transactions. Concurrently, each of these JVs leased the purchased properties back to an affiliate of the seller and provided the seller-lessee with purchase options. Accordingly, these sale and leaseback transactions meet the accounting criteria to be presented as financing receivables. Furthermore, we determined that we exercise power over and receive benefits from each of these joint ventures. Therefore, we consolidated the joint ventures as Financing Receivables on
16
our Consolidated Balance Sheets and recorded the rental revenue from these joint ventures as Interest income from financing receivables on our Consolidated Statements of Income.
The following tables provide information regarding our investments in financing receivables at September 30, 2026 (dollar amounts in thousands):
Interest
Lease
Rate
Investments
7.50%
2023
2033
NC
123,708
120,792
523
2025-2029
236.54
7.25%
2024
2034
NC/SC
122,799
64,789
2024-2028
234.80
41,024
38,009
217
189.05
287,531
223,590
28
1,263
The following table summarizes our financing receivable activity for the nine months ended September 30, 2026 and 2025 (in thousands):
Investment and funding under financing receivables
988
777
Sale of properties accounted for as a financing receivable
(62,220)
Distribution paid to non-controlling interest related to sale of properties accounted for as a financing receivable
(1) (2)
Amortization of capital costs
(58)
Recovery of credit losses
756
(7)
Net decrease (increase) in financing receivables
(74,801)
712
5.
Mortgage Loans Receivable
The following table sets forth information regarding our investments in mortgage loans secured by first mortgages at September 30, 2026 (dollar amounts in thousands):
Interest Rate
Loans (1)
11.3%
2043
MI
179,373
44.7
1,749
102.56
8.3%
2030
56,379
14.0
329.70
8.5%
FL
40,772
10.2
250
163.09
10.3%
2045
39,550
9.9
480
82.40
10.8%
19,600
4.9
201
97.51
8.8%
2027
17,984
4.5
211.58
11.0%
14,775
3.7
146
101.20
7.3%
11,218
2.8
45
249.29
9.0%
IL
21,183
5.3
116
182.61
400,834
27
2,576
667
123.60
The following table summarizes our mortgage loan activity for the nine months ended September 30, 2026 and 2025 (in thousands):
Originations and funding under mortgage loans receivable
16,011
99,590
Payoffs received
(21,281)
Scheduled principal payments received
(680)
(450)
Mortgage loan premium amortization
(8)
(6)
Provision for credit losses
(153)
(779)
Net increase in mortgage loans receivable
15,170
77,074
6.
Investment in Unconsolidated Joint Ventures
We had a $12,700,000 acquisition, development and construction (“ADC”) mortgage loan with a carrying value of $12,558,000. The ADC mortgage loan, secured by a 104-bed skilled nursing center in Texas, met the accounting criteria to be considered a variable interest entity (“VIE”). We were not the primary beneficiary of the VIE as we did not have both: 1) the power to direct the activities that most significantly affect the VIE’s economic performance, and 2) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE. However, we had significant influence over the VIE. Therefore, we accounted for the investment as a joint venture using the equity method of accounting. During the three months ended June 30, 2026, the mortgage loan was paid off.
19
Additionally, we had two preferred equity investments that also met the accounting criteria to be considered a VIE based on the same factors discussed above for the ADC loan. During 2025, both preferred equity investments were redeemed. The following table summarizes income recognized and cash interest received related to our investments in unconsolidated joint ventures during the nine months ended September 30, 2026 and 2025 (in thousands):
Cash Income
Non-cash
Recognized
Earned
Income Accrued
SNF (1)
434
SH (2)
884
SH (3)
3,225
3,260
53
7.
Notes Receivable
Notes receivable consist of working capital loans and a mezzanine loan. The following table summarizes our investments in notes receivable at September 30, 2026 (dollar amounts in thousands):
Type of
IRR
Loan
# of loans
Working capital
25
8.0%
11.0
Mezzanine
25,000
25,025
The following table is a summary of our notes receivable components as of September 30, 2026 and December 31, 2025 (in thousands):
At September 30, 2026
At December 31, 2025
Mezzanine loans
Working capital loans
874
Notes receivable credit loss reserve
(250)
(259)
Total notes receivable, net of credit loss reserve
The following table summarizes our notes receivable activity for the nine months ended September 30, 2026 and 2025 (in thousands):
Advances under notes receivable
Principal payments received under notes receivable
(849)
(18,039)
207
Net decrease in notes receivable
(840)
(20,500)
8.
Credit Loss Reserve
We apply Accounting Standards Codification (“ASC”) Topic 326, Financial Instruments-Credit Losses (“ASC 326”), which requires a forward-looking “expected loss” model, to estimate our loan losses. We determined our Financing receivables, Mortgage loans receivable and Notes receivable line items on our Consolidated Balance Sheets are within the scope of ASC 326.
Financing receivables. We obtained controlling interests in JVs that acquired properties through sale and leaseback transactions. The JVs concurrently leased the purchased properties to affiliates of sellers and provided the sellers-lessees with purchase options. We consolidated the JVs as Financing receivables on our Consolidated Balance Sheets. For more information regarding these transactions see Note 4. Financing Receivables above. At September 30, 2026, we had investments in three JVs accounted for as financing receivables that owned 28 properties in two states. In addition to owning the properties through our controlling interests in the JVs, generally, these leases provide one or more of the following: security deposits, property tax impounds, repair and maintenance escrows and other credit enhancements such as corporate or personal guarantees or letters of credit.
Mortgage loans. As part of our strategy of making investments in properties used in the provision of long-term health care services, we provided mortgage loan financing on such properties. At September 30, 2026, we had nine mortgage loans secured by 27 properties in five states with six borrowers. In addition to a lien on the mortgaged properties, the loans are generally secured by non-real estate assets of the properties and contain certain other security provisions in the form of letters of credit and/or security deposits.
Notes receivable. Our notes receivable consist of a working capital note and a mezzanine loan. Security for these notes can include all or a portion of the following credit enhancements: secured second mortgage, pledge of equity interests and personal/corporate guarantees.
The following table summarizes our financial instruments within the scope of ASC 326 by year of origination (in thousands):
Year of origination (1)
Investment Type:
2022
Prior
Credit loss reserve
Financing receivables
163,823
2,875
Mortgage loans receivable
97,151
29,202
253,298
4,002
Working Capital loans
Total Notes Receivable
We monitor the credit quality of our financial instruments through a variety of methods determined by the underlying collateral or other protective rights, operator’s payment history and other internal metrics. Our monitoring process includes periodic review of financial statements for each facility, scheduled property inspections and review of covenant compliance, industry conditions and current and future economic conditions. The future economic conditions are based on the economic data from the Federal Reserve and reasonable assumptions for the future economic trends.
In determining the “expected” credit loss reserves on these instruments, we utilize the probability of default and discounted cash flow methods. Further, we stress-test the results to reflect the impact of unknown adverse future events including recessions.
The expected credit losses related to our financial instruments that are within the scope of ASC 326 are as follows (in thousands):
Recovery
Provision
Balance
due to
at
Payoffs/
Originations/
Description
12/31/2025
Write-offs
additional funding
9/30/2026
Credit Loss Reserve – Financing Receivables
3,631
(765)
Credit Loss Reserve – Mortgage Loans Receivable
3,849
153
Credit Loss Reserve – Notes Receivable
259
(9)
We elected not to measure an allowance for expected credit losses on accrued interest receivable under the expected credit loss standard as we have a policy in place to reserve or write-off accrued interest receivable in a timely manner through our quarterly review of the loan and property performance. Therefore, we elected the policy to write-off accrued interest receivable by recognizing credit loss expense. As of September 30, 2026, the total balance of accrued interest receivable of $25,274,000 was not included in the measurement of expected credit loss. During the nine months ended September 30, 2025, we wrote-off Anthem’s interest receivable of $371,000 in connection with the conversion of Anthem’s triple-net leases to SHOP as explained in Note 3. Owned Real Properties.
9.
Prepaid Expenses and Other Assets
The following is a summary of our prepaid expenses and other assets at September 30, 2026 and December 31, 2025 (in thousands):
Interest rate swap asset
SHOP prepaid expenses and other assets
8,485
2,399
Investments, prepaid expenses and other assets
7,527
3,609
SHOP accounts receivable, net of credit loss reserve: 2026— $487; 2025— $304
6,124
3,130
Intangible assets, net of accumulated amortization: 2026— $2,308; 2025— $1,789
6,001
6,520
Right of use asset, net
2,324
2,580
Lease incentives
1,816
2,525
22
10.
Intangible Assets
We make estimates in allocating the purchase price of acquisitions to the various components of the acquisition based on the fair value of each component. For certain acquisitions, such components include in-place leases and other intangible assets. In the case of the value of in-place leases, we make estimates based on the evaluation of the specific characteristics of each tenant’s lease. Factors considered include estimates of carrying costs during the hypothetical expected lease-up periods, market conditions and costs to execute similar leases. The following is a summary of the carrying amount of intangible assets as of September 30, 2026 and December 31, 2025 (in thousands):
Assets
Cost
Amortization
In-place leases
46,878
(10,107)
36,771
24,098
(7,772)
16,326
Tax abatement intangible
8,309
(2,308)
(1,789)
The following table provides future amortization expenses related to the intangible assets at September 30, 2026 (in thousands):
October-December
2028
2031
Thereafter
In-place leases (1)
2,114
8,430
8,068
7,737
7,212
2,879
331
Tax abatement intangible (2)
173
692
2,368
42,772
2,287
9,122
8,760
8,429
7,904
3,571
2,699
23
11.
Debt Obligations
Unsecured Credit Facility. We had an unsecured credit agreement (the “Original Credit Agreement”) that provided for an aggregate commitment of the lenders of up to $525,000,000 comprising of a $425,000,000 revolving credit facility and two $50,000,000 term loans with maturities of November 19, 2025 and November 19, 2026 (the “Original Term Loans”). The Original Credit Agreement had a maturity date of November 19, 2026 and permitted us to request increases to the revolving credit facility and term loans commitments up to a total of $1,000,000,000 (the “Original Accordion”).
During the third quarter of 2025, we entered into a new four-year unsecured credit agreement (the “Credit Agreement”) maturing in July 2029, to replace the Original Credit Agreement. The Credit Agreement increased the aggregate commitment on our revolving line of credit from $425,000,000 to $600,000,000 (the “Revolving Line of Credit”), provided for the opportunity to increase the total commitment to an aggregate $1,200,000,000 (the “Accordion”) and allowed for a one-year extension option, subject to customary conditions. Material terms of the Credit Agreement remained unchanged. In connection with the Credit Agreement, the Original Term Loans were rolled into the Revolving Line of Credit. During the fourth quarter of 2025, we amended our Credit Agreement to increase the aggregate commitment of the lenders by $200,000,000 to a total of $800,000,000 through the exercise of the Accordion and established term loans totaling $200,000,000 (the “Term Loans”). The Term Loans consist of $50,000,000, $55,000,000, $55,000,000 and $40,000,000 borrowings, with contractual maturities of three, four, five and seven years, respectively.
During the second quarter of 2026, we entered into an amendment to the Credit Agreement (the “Amended Credit Agreement”) to increase the aggregate commitment of its lenders by $300,000,000 to a total of $1,100,000,000, through the exercise of the Credit Agreement’s accordion feature. The $300,000,000 increase expands our aggregate revolving credit (the “Amended Revolving Line of Credit”) commitment to $900,000,000. Additionally, the Amended Credit Agreement increases the Accordion feature up to $2,000,000,000 (the “Amended Accordion”). The material terms of the Amended Credit Agreement remain unchanged.
Based on our leverage at September 30, 2026, the facility provides for interest annually at SOFR plus 110 basis points and a facility fee of 15 basis points.
Interest Rate Swap Agreements. In connection with entering into the Original Term Loans described above, we entered into two receive variable/pay fixed interest rate swap agreements with maturities of November 19, 2025 and November 19, 2026, respectively, that effectively locked in the forecasted interest payments on the Original Term Loans’ borrowings over their four and five year terms of the loans. Additionally, during the fourth quarter of 2025, we entered into interest rate swaps with maturities of three, four, five and seven years, respectively to effectively lock-in the forecasted interest payments on the Term Loans. Furthermore, during the second quarter of 2026, we entered into three-year interest rate swap agreements to effectively fix the interest rate on $150,000,000 of borrowings under our Amended Revolving Line of Credit. Our interest rate swaps are considered cash flow hedges and are recorded on our Consolidated Balance Sheets at fair value in Prepaid expenses and other assets, with cumulative changes in the fair value of these instruments recognized in Accumulated other comprehensive income (loss) on our Consolidated Balance Sheets. During the nine months ended September 30, 2026 and 2025, we recorded an increase of $11,086,000 and a decrease of $2,356,000 to the fair value of our interest rate swaps, respectively.
Information regarding our interest rate swaps measured at fair value, which are classified as Level 2 of the fair value hierarchy, is presented below (dollar amounts in thousands):
Notional
Fair Value at
Swap Rate
Date Entered
Maturity Date
Rate Index
2.36
November 2021
November 19, 2026
1-month SOFR
50,000
182
938
4.61
December 2025
December 12, 2028
SOFR with 5-day lookback
665
(52)
(55)
4.65
December 12, 2029
55,000
2,060
(136)
4.68
December 12, 2030
30,000
1,421
(45)
4.72
1,152
(74)
4.95
June 2026
June 25, 2029
625
4.97
35,000
703
606
4.99
1,084
5.21
December 12, 2032
27,500
1,672
5.25
12,500
731
(49)
400,000
Senior Unsecured Notes. We have senior unsecured notes held by institutional investors with interest rates ranging from 3.66% to 4.50%. The senior unsecured notes mature between 2028 and 2033.
The Credit Agreement and the senior unsecured notes contain financial covenants, which are measured quarterly, that require us to maintain, among other things:
At September 30, 2026, we were in compliance with all applicable financial covenants. These debt obligations also contain additional customary covenants and events of default that are subject to a number of important and significant limitations, qualifications and exceptions.
The following table sets forth information regarding debt obligations by component as of September 30, 2026 and December 31, 2025 (dollar amounts in thousands):
Applicable
Available
Outstanding
for
Rate (1)
Borrowing
Revolving line of credit (2)
4.62%
470,100
347,137
Term loans, net of debt issue costs
4.83%
Senior unsecured notes, net of debt issue costs (3)
4.08%
4.47%
985,094
842,181
During the nine months ended September 30, 2026 and 2025, our debt borrowings and repayments were as follows (in thousands):
Borrowings
Repayments
554,137
(377,100)
433,500
(29,400)
Term loans
(100,000)
Senior unsecured notes
(44,500)
(411,600)
(173,900)
12.
Accrued Expenses and Other Liabilities
The following is a summary of our accrued expenses and other liabilities at September 30, 2026 and December 31, 2025 (in thousands):
SHOP liabilities
20,555
8,734
Impounds
14,840
14,627
Property tax liability
6,612
7,125
Accounts payable and other accrued liabilities
5,562
7,584
Maintenance and repair reserves
4,700
6,152
SHOP deferred revenue
3,327
2,115
Lease liabilities
Security deposits
1,703
1,601
Deferred commitments
956
3,171
26
13.
Non-controlling Interests. We have entered into partnerships to develop and/or own real estate. Given that our limited members do not have substantive kick-out rights, liquidation rights, or participation rights, we have concluded that the partnerships are VIEs. As we exercise power over and receive benefits from the VIEs, we are considered the primary beneficiary. Accordingly, we consolidate the VIEs and record the non-controlling interests on our Consolidated Balance Sheets.
As of September 30, 2026, we have the following consolidated VIEs (in thousands):
Consolidated
Non-Controlling
Purpose
Assets (1)
Own real estate
58,010
3,015
OH
54,953
9,134
2,916
342,484
During 2026, a lessee, which was also our joint venture partner in a VIE for which we were the primary beneficiary, exercised its purchase option and acquired three skilled nursing centers owned by the JV. The centers have a total of 299 beds and are located in Florida with an aggregate gross book value of $76,545,000. Our JV partner’s non-controlling interest contribution was $14,325,000. As a result, this VIE is not listed in the table above.
Common Stock. We had an equity distribution agreement (the “Original Equity Distribution Agreement”) to offer and sell, from time to time, up to $400,000,000 in aggregate offering price of shares of our common stock. During the nine months ended September 30, 2026 and 2025, we sold 5,257,220 and 1,655,100 shares of common stock for net proceeds of $198,064,000 and $59,316,000, respectively, under our Original Equity Distribution Agreement. In conjunction with the sale of common stock, during the nine months ended September 30, 2026 and 2025, we incurred $200,000 and $353,000 of costs associated with this agreement, which have been recorded in additional paid in capital as a reduction of proceeds received.
During the third quarter of 2026, we terminated our Original Equity Distribution Agreement and entered into a new equity distribution agreement (the “Equity Distribution Agreement”) to sell, from time to time up to $500,000,000 in aggregate offering price of shares of our common stock. The Equity Distribution Agreement provides for sale of common shares to be made by means of ordinary brokers’ transactions, which may include block trades, or transactions that are deemed to be “at the market” offerings.
During the third quarter of 2026, we sold 914,120 shares of common stock for $38,726,000 in net proceeds under the Equity Distribution Agreement. In conjunction with the sale of common stock, we incurred $213,000 of costs associated with this agreement, which has been recorded in additional paid in capital as a reduction of proceeds received. At September 30, 2026, we had $461,140,000 available under the Equity Distribution Agreement. Subsequent to September 30, 2026, we sold 1,371,986 shares of common stock for $58,717,000 in net proceeds under the Equity Distribution Agreement. Accordingly, at November 3, 2026, we have $401,940,000 available under the Equity Distribution Agreement.
During the nine months ended September 30, 2026 and 2025, we acquired 149,745 and 151,018, respectively, shares of common stock held by employees who tendered owned shares to satisfy tax withholding obligations.
Available Shelf Registration. We have an automatic shelf registration statement on file with the SEC, and currently have the ability to file additional automatic shelf registration statements, to provide us with capacity to publicly offer an indeterminate amount of common stock, preferred stock, warrants, debt, depositary shares, or units. We may from time to time raise capital under our automatic shelf registration statement in amounts, at prices, and on terms to be announced when and if the securities are offered. The specifics of any future offerings, along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of the offering. Our shelf registration statement expires in November 2027.
Distributions. We declared and paid the following cash dividends (in thousands):
Declared
Paid
Common Stock (1)
89,830
80,012
In October 2026, we declared a monthly cash dividend of $0.19 per share on our common stock for the months of October, November and December 2026, payable on October 30, November 30 and December 31, 2026, respectively, to stockholders of record on October 22, November 20, and December 23, 2026, respectively.
Stock-Based Compensation. During 2021, we adopted and our shareholders approved the 2021 Equity Participation Plan (“the 2021 Plan”) which replaces the 2015 Equity Participation Plan (“the 2015 Plan”). Under the 2021 Plan, 1,900,000 shares of common stock have been authorized and reserved for awards, less one share for every one share that was subject to an award granted under the 2015 Plan after December 31, 2020 and prior to adoption. In addition, any shares that are not issued under outstanding awards under the 2015 Plan because the shares were forfeited or cancelled after December 31, 2020 will be added to and again be available for awards under the 2021 Plan. Under the 2021 Plan, the shares were authorized and reserved for awards to officers, employees, non-employee directors and consultants. The terms of the awards granted under the 2021 Plan and the 2015 Plan are set by our compensation committee at its discretion. Beginning in the first quarter of 2024, we entered into Performance Stock Unit Award Agreements, based upon absolute and relative total shareholder return, under the 2021 Plan.
The following table summarizes our restricted stock activity for the nine months ended September 30, 2026 and 2025:
Weighted Average Price
Outstanding, January 1
270,701
301,209
33.75
33.18
Granted
145,369
135,041
38.93
34.94
Vested
(140,801)
(165,549)
34.11
33.69
Outstanding, September 30
275,269
36.30
During the nine months ended September 30, 2026, 170,827 units of performance-based stock units vested. During the nine months ended September 30, 2025, 182,915 units of performance-based stock units vested, which includes the accelerated vesting of 19,694 performance-based stock units in connection with an employee’s retirement.
During the nine months ended September 30, 2026 and 2025, we granted restricted stock and performance-based stock units under the 2021 Plan as follows:
Grant Date
Fair Value
No. of
Shares/Units
Share
Reward Type
Vesting Period
129,984
38.92
Restricted stock
ratably over 3 years
62,247
36.63
Performance-based stock units
TSR targets (1)
55,870
40.81
TSR targets (2)
15,385
39.00
263,486
113,790
34.88
52,666
33.37
48,535
36.21
5,626
35.55
April 30, 2028
15,625
35.20
236,242
Compensation expense recognized related to the vesting of restricted common stock and performance-based stock units for the nine months ended September 30, 2026 and 2025 was $6,675,000 and $7,188,000, respectively. Accordingly, the remaining compensation expense to be recognized related to the future service period of unvested outstanding restricted common stock and performance-based stock units is as follows (in thousands):
Remaining
Compensation
Vesting Date
Expense
October-December 2026
2,284
6,305
3,529
534
12,652
14.
Commitments and Contingencies
At September 30, 2026, we had commitments as follows (in thousands):
Commitment
Funding
Funded
Owned real properties-Triple-Net Portfolio (Note 3. Owned Real Properties)
1,104
471
366
Financing receivables (Note 4. Financing Receivables)
2,250
373
2,038
212
Accrued incentives and earn-out liabilities
3,000
Mortgage loans (Note 5. Mortgage Loans Receivable)
51,842
14,677
25,102
26,740
Notes receivable (Note 7. Notes Receivable)
370
345
58,566
15,521
27,903
30,663
Additionally, we expect to invest capital related to our SHOP segment to improve and maintain our properties. Some of our lease agreements provide purchase options allowing the lessee to purchase the properties they currently lease from us. See Note 3. Owned Real Properties and Note 4. Financing Receivables for additional information about our purchase options.
We are a party from time to time to various general and professional liability claims and lawsuits asserted against the lessees or borrowers of our properties, which in our opinion are not singularly or in the aggregate material to our results of operations or financial condition. These types of claims and lawsuits may include matters involving general or professional liability, which we believe under applicable legal principles are not our responsibility as a non-possessory landlord or mortgage holder. We believe that these matters are the responsibility of our lessees and borrowers pursuant to general legal principles and pursuant to insurance and indemnification provisions in the applicable leases or mortgages. We intend to continue to vigorously defend such claims.
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15.
Earnings per Share
The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share amounts):
Income allocated to participating securities:
Non-forfeitable dividends on participating securities
(157)
Undistributed income allocated to participating securities
(1,615)
(1,646)
Total net income allocated to participating securities
Net income available to common stockholders–basic
Effect of dilutive securities:
Reallocation of undistributed income to participating securities
Net income available to common stockholders–diluted
346,387
399,273
Shares for basic net income per share
445
440
381
Total effect of dilutive securities
Shares for diluted net income per share
Basic net income per share
Diluted net income per share
16.
Fair Value Measurements
In accordance with the accounting guidance regarding the fair value option for financial assets and financial liabilities, entities are permitted to choose to measure certain financial assets and liabilities at fair value, with the change in unrealized gains and losses reported in earnings. We did not elect the fair value option for any of our financial assets and financial liabilities.
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The carrying amount of cash and cash equivalents approximates their fair value because of the short-term maturity of these instruments. We do not invest our cash in auction rate securities. The carrying value and estimated fair value of our financial instruments as of September 30, 2026 and December 31, 2025 were as follows (in thousands):
Fair
Financing receivables, net of credit loss reserve
291,859
367,986
Mortgage loans receivable, net of credit loss reserve
420,733
462,312
Notes receivable, net of credit loss reserve
28,920
29,576
Senior unsecured notes, net of debt issue costs
328,894
372,511
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17.
Segment Information
We use the management approach in determining the reportable operating segments. The management approach considers the internal organization and reporting used by our chief operating decision maker (“CODM”) for making operating decisions, allocating resources and assessing performance as the source for determining our reportable segments. In making this determination, we:
During the nine months ended September 30, 2026 and 2025, the CODM has been collectively identified as our Executive Chairman and Co-CEOs, who share the responsibility for allocating resources and assessing segment performance.
During the second quarter of 2025, we began utilizing the RIDEA structure and established our SHOP segment. Accordingly, we conduct and manage our business as two operating segments: real estate investments and SHOP and our CODM evaluated the performance of our investments based on net operating income (“NOI”). For more information and reconciliation of NOI see Item 2. Non-GAAP Financial Measures. The following tables summarize information by reportable segment for the three and nine months ended September 30, 2026 and 2025 (unaudited, in thousands):
Three Months Ended September 30, 2026
Real estate
Non-segment
investment portfolio
/corporate (1)
639
530
44,177
Property level expenses
(1,987)
(50,808)
(52,795)
NOI
42,190
19,731
62,451
(11,312)
(13,718)
(2,310)
(47)
(1,165)
(8,125)
Gain on sale of real estate, net
Income tax provision
Nine Months Ended September 30, 2026
1,917
1,037
132,223
(6,482)
(129,905)
(136,387)
126,137
46,351
173,525
(31,578)
(38,068)
Recovery for credit losses
610
(3,042)
(24,868)
Three Months Ended September 30, 2025
2,191
102
46,985
(2,581)
(17,362)
(19,943)
44,843
4,841
49,786
(8,791)
(8,987)
(41,455)
(203)
(587)
(7,523)
Loss on sale of real estate, net
Net loss
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Nine Months Ended September 30, 2025
4,642
406
144,002
(8,483)
(26,781)
(35,264)
140,062
7,372
147,840
(24,718)
(26,925)
(3,642)
(7,734)
(22,941)
Income tax benefit
Total assets by reportable business segment and segment-level significant expense categories are not disclosed as our CODM is not provided with such information to evaluate business performance and allocate resources.
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18.
Income Taxes
Our Company qualifies as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended. As such, we generally are not taxed on income that is distributed to our stockholders. Under RIDEA, a REIT may lease a “qualified healthcare property” on an arm's-length basis to a taxable REIT subsidiary (“TRS”) if the property is operated on behalf of such TRS by a person who qualifies as an “eligible independent operator”. Generally, the rent received from the TRS will meet the related party exception and will be treated as “rents from real property”. A “qualified healthcare property” includes real property and any personal property that is, or is necessary or incidental to the use of, a hospital, nursing facility, assisted living facility, congregate care facility, qualified continuing care facility, or other licensed facility which extends medical or nursing or ancillary services to patients. Resident fees and services revenue and related operating expenses for these facilities are reported on our Consolidated Statements of Income and are subject to federal, state and local income taxes. Our provision for income taxes for the three and nine months ended September 30, 2026, was an expense of $398,000 and $674,000, respectively. Our provision for income taxes for the three and nine months ended September 30, 2025, was an expense of $42,000 and a benefit of $39,000, respectively. At September 30, 2026, our deferred income tax assets and deferred income tax liabilities with respect to our TRS entity were $278,000 and $367,000, respectively. At December 31, 2025, our deferred income tax assets and deferred income tax liabilities with respect to our TRS entity were $729,000 and $695,000, respectively.
19.
Subsequent Events
Subsequent to September 30, 2026, the following events occurred:
Real Estate Acquisitions. The following table summarizes information regarding our acquisitions subsequent to September 30, 2026 (dollar amounts in thousands):
Totals (1)
Purchase Option Notices. We received notice of an operator’s intent to exercise its purchase option under a master lease covering four skilled nursing centers with a total of 339 beds in Texas. The properties have a gross book value and net book value of $52,726,000 and $46,516,000, respectively, and generate approximately $4,800,000 of annual cash rental income.
Debt. We repaid $20,000,000 under our unsecured revolving line of credit. Accordingly, as of November 3, 2026, we have $409,900,000 outstanding and $490,100,000 available for borrowing under our unsecured revolving line of credit. Additionally, we repaid $2,000,000 in scheduled principal paydowns on our senior unsecured notes.
Equity. We sold 1,371,986 shares of common stock for $58,717,000 in net proceeds under our Equity Distribution Agreement. Accordingly, we have $401,940,000 available under our Equity Distribution Agreement.
Additionally, we declared a monthly cash dividend of $0.19 per share on our common stock for the months of October, November and December 2026, payable on October 30, November 30 and December 31, 2026, respectively to stockholders of record on October 22, November 20, and December 23, 2026, respectively.
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Item 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Cautionary Statement Regarding Forward-Looking Statements
This quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act adopted pursuant to the Private Securities Litigation Reform Act of 1995. Statements that are not purely historical may be forward-looking. You can identify some of the forward-looking statements by their use of forward-looking words, such as “believes,” “expects,” “may,” “will,” “could,” “would,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates” or “anticipates,” or the negative of those words or similar words. Forward-looking statements involve inherent risks and uncertainties regarding events, conditions and financial trends that may affect our future plans of operation, business strategy, results of operations and financial position. A number of important factors could cause actual results to differ materially from those included within or contemplated by such forward-looking statements, including, but not limited to, operational and legal risks and liabilities under our new SHOP segment; our dependence on the ability of our third-party independent operators to successfully manage and operate our SHOP communities; our dependence on our operators for revenue and cash flow; government regulation of the health care industry; changes in federal, state, or local laws limiting real estate investment trust (“REIT”) investments in the health care sector; federal and state health care cost containment measures including reductions in reimbursement from third-party payors such as Medicare and Medicaid; required regulatory approvals for operation of health care facilities; a failure to comply with applicable law or regulations for the operation of health care facilities; the adequacy of insurance coverage maintained by our operators; our reliance on a few major operators; our ability to find suitable replacement operators for our SHOP communities; our ability to renew leases or enter into favorable terms of renewals or new leases; the impact of inflation; operator financial or legal difficulties; the sufficiency of collateral securing mortgage loans; an impairment of our real estate investments; the relative illiquidity of our real estate investments; our ability to develop and complete construction projects; our ability to invest cash proceeds for health care properties; a failure to qualify as a REIT; our ability to grow if access to capital is limited; and a failure to maintain or increase our dividend. For a discussion of these and other factors that could cause actual results to differ from those contemplated in the forward-looking statements, please see the discussion under “Risk Factors” contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and in our publicly available filings with the Securities and Exchange Commission. We do not undertake any responsibility to update or revise any of these factors or to announce publicly any revisions to forward-looking statements, whether as a result of new information, future events or otherwise. Although our management believes that the assumptions and expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. The actual results may differ materially from any forward-looking statements due to the risks and uncertainties of such statements.
Executive Overview
Company Overview
We are a health care real estate investment trust (“REIT”) that invests in seniors housing and health care properties through our owned seniors housing operating portfolio (“SHOP”), triple-net leases and joint ventures. We have been operating since August 1992.
Our primary seniors housing and health care property classifications include independent living communities, assisted living communities, memory care communities and combinations thereof and skilled nursing centers (“SNF”). For purposes of this quarterly report and other presentations, we
generally include independent living communities, assisted living communities, memory care communities and combinations thereof in the seniors housing communities classification (“SH”). We also have investments in other (“OTH”) types of properties, such as land parcels, projects under development (“UDP”) and a behavioral health care hospital.
Substantially all of our revenues and sources of cash flows from operations are derived from resident fees and services, rents from operating leases, interest earned on financing receivables and interest earned on outstanding loans receivable. Income from our investments represents our primary source of liquidity to fund distributions and is dependent upon the performance of our SHOP communities and operators on their lease and loan obligations and the rates earned thereon. To the extent that the operators experience operating difficulties and are unable to generate sufficient cash to make payments to us, there could be a material adverse impact on our consolidated results of operations, liquidity and/or financial condition. To mitigate this risk, we monitor our investments through a variety of methods determined by investment type, property type and operator. Our monitoring process includes periodic review of financial statements for each facility, periodic review of operator credit, scheduled property inspections and review of covenant compliance.
In addition to our monitoring and research efforts, we also structure our investments to help mitigate payment risk. Some operating leases and loans are credit enhanced by guaranties and/or letters of credit. In addition, operating leases are typically structured as master leases and loans are generally cross-defaulted and cross-collateralized with other loans, operating leases or agreements between us and the operator and its affiliates.
We conduct and manage our business as two operating segments, for reporting and decision-making purposes: i) real estate investments (“Real Estate Investments”) segment which consists of owned real properties subject to non-cancelable triple-net leases (“NNN” or “Triple-Net Portfolio”), financing receivables, mortgage loans, notes receivable and unconsolidated joint ventures and ii) SHOP segment.
Business and Investment Strategy
Since commencing operations in August 1992, our objective has been to create, sustain and enhance stockholder equity value and provide current income for distribution to stockholders through real estate investments in seniors housing and health care properties managed by experienced operators. Our goal is to invest in properties that provide opportunity for additional value and current returns to our stockholders and diversify our investment portfolio by geographic location and operator.
During the second quarter of 2025, we began utilizing the structure authorized by the REIT Investment Diversification and Empowerment Act of 2007 (commonly referred to as “RIDEA”) as authorized by the Housing and Economic Recovery Act of 2008. Under RIDEA, we are permitted to participate directly in the cash flow of qualified healthcare properties (compared to receiving solely contractual rental income) and have certain oversight approval rights and the right to review operational and financial reporting information. However, our independent third-party operators ultimately control the day-to-day operations of the property, pursuant to the terms of our management agreements. Offering RIDEA structures represents a further aspect of our traditional strategy of investing through vehicles such as non-cancelable triple-net operating leases, mortgage loans, and structured finance. We believe that RIDEA structures provide us with additional investment and higher growth opportunities.
We also have identified opportunities to convert existing triple-net leases into our new SHOP segment, and in certain instances have completed these conversions. To develop and implement RIDEA structures, we may need to continue to commit financial and operational resources. While we anticipate that adding RIDEA transactions will be positive for our business model, our ability to succeed in this new
segment will be determined by numerous factors, including our ability to identify suitable investments and our relationship with operators of our SHOP communities. We rely on the SHOP operator’s personnel, expertise, resources, good faith, and judgment to manage our SHOP communities efficiently and effectively. We also rely on the SHOP operators to set appropriate resident fees, provide accurate property-level financial results for our properties in a timely manner, and otherwise operate our SHOP communities in compliance with the terms of our management agreements and all applicable laws and regulations.
Depending upon the availability and cost of external capital, we anticipate making additional investments in seniors housing communities. New investments are generally funded from cash on hand, proceeds from periodic asset sales, borrowings under our unsecured revolving line of credit, proceeds from sale of common stock under our ATM, and internally generated cash flows. Our investments generate internal cash from resident fees and services, rent, interest from financing receivables and interest receipts and principal payments on loan receivables. Permanent financing for future investments, which replaces funds drawn under our unsecured revolving line of credit, may be provided through a combination of public and private offerings of debt and equity securities and secured and unsecured debt financing. The timing, source and amount of cash flows provided by financing activities and used in investing activities are sensitive to the capital markets’ environment, especially to changes in interest rates. Changes in the capital markets’ environment may impact the availability of cost-effective capital.
We believe our business model has enabled and will continue to enable us to maintain the integrity of our property investments, including in response to financial difficulties that may be experienced by operators and the variability of cash flow from our SHOP segment. Traditionally, we have taken a conservative approach to managing our business, choosing to maintain liquidity and exercise patience until favorable investment opportunities arise.
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Real Estate Portfolio Overview
The following tables summarize our real estate investment portfolio as of September 30, 2026 (dollar amounts in thousands):
and Resident
of Total
Owned Properties
Fees and Services
Revenues
Triple-Net Portfolio:
13.6
21,002
7.6
11.5
29,996
10.8
0.4
896
0.3
Subtotal: Triple-Net Portfolio
2,376
25.5
51,894
(3)
18.7
SHOP:
49.0
(4)
63.4
Total Owned Properties
74.5
228,150
82.1
Interest Income
from Financing
Receivables
10.3
16,921
6.1
Total Financing Receivables
(5)
from Mortgage
Mortgage Loans
Loans
147,537
5.2
9,026
3.2
253,297
9.1
21,907
7.9
Total Mortgage Loans
14.3
11.1
and other
621
0.9
0.7
(6)
Total Portfolio
164
5,401
9,024
2,800,153
277,921
Summary of Properties by Type
8,881
2,212,765
79.0
5,283
575,383
20.6
As of September 30, 2026, we had $2.5 billion in net carrying value of investments as follows (in thousands):
1,284,315
51.7
Triple-Net Portfolio
490,950
19.8
Mortgage loans
16.0
Notes receivable
1.0
The following table provides details on the components of revenues and related net operating income (“NOI”) across our portfolio (in thousands):
Real Estate Investment segment:
Variable cash rental income
Straight-line rent adjustment (1)
Financing Receivables:
Cash interest income from financing receivables
5,282
18,640
Effective interest income (2)
362
1,097
Write-off of effective interest related to sale of properties accounted for as a financing receivable (2)
(198)
Mortgage loans receivable:
Cash interest received
10,117
30,033
Effective interest income (3)
272
900
Other notes receivable:
Interest income-other notes
663
1,988
Effective interest adjustment (4)
(24)
(71)
Interest income from notes receivable
Unconsolidated joint ventures
Total revenue-Real Estate Investments segment
132,619
NOI-Real Estate Investment Segment (5)
SHOP segment:
Resident fees and services:
Property level expenses-SHOP
NOI-SHOP Segment (5)
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Update on Certain Operators
Genesis Healthcare, Inc.
During the second quarter of 2025, we received written notice from Genesis Healthcare Inc. (“Genesis”) of its exercise of a 5-year extension option, which extended the term of the lease to April 30, 2031. During the third quarter of 2025, Genesis filed for Chapter 11 bankruptcy. Accordingly, we wrote-off the straight-line rent receivable balance of $1.3 million related to Genesis’ master lease. During the three months ended March 31, 2026, a federal bankruptcy judge approved the sale of Genesis’ assets to a newly formed investment group. The sale of Genesis’ assets, including the leasehold interest in our properties, closed in October 2026, and the lease was assumed on its terms by an affiliate of 101 W State Street Holdings, LLC.
Prestige Healthcare
Prestige Healthcare (“Prestige”) operates 21 skilled nursing centers located in Michigan secured under four mortgage loans and two skilled nursing centers located in South Carolina under a master lease. Prestige is our largest operator based on total revenues and second largest operator based on total assets, representing 7.4% of our total revenues and 9.4% of our total assets as of September 30, 2026.
Prior to an amendment in July 2025, under Prestige’s $179.9 million mortgage loan secured by 14 properties, the minimum mortgage interest payment due to us was based on an annual current pay rate of 8.5% on the outstanding loan balance. The difference between the contractual interest rate and the current pay interest rate on the outstanding loan balance remained an obligation of Prestige and was payable through the application of security deposits we hold on behalf of Prestige or was payable at maturity.
During the third quarter of 2025, Prestige’s $179.9 million mortgage loan was modified to provide Prestige an option to prepay this mortgage loan at par and without penalty within a 12-month window beginning in July 2026. The modification was effective July 1, 2025. Under the modification, Prestige agreed to provide us with at least a 90-day notice of its intention to exercise the option, and the ability for Prestige to exercise the pre-payment option is contingent on several factors including Prestige being current and in good standing on all its mortgage loans with LTC and obtaining replacement financing. During the third quarter of 2025, in conjunction with the loan amendment that provided the borrower with a penalty-free early payoff option, we wrote-off $41.5 million of effective interest previously accrued related to this loan. During the three months ended March 31, 2026, Prestige provided notice of its intent to repay its $179.9 million mortgage loan and we expect them to repay the loan during the fourth quarter of 2026. Prestige is current on their contractual loan obligations through November 2026.
Other Operator
In October 2026, we engaged a broker to market two seniors housing communities for sale which are currently part of a master lease covering seven seniors housing communities (the “Portfolio”). We intend to negotiate with the current operator to remove the two communities from the existing master lease. However, the lease has not been amended as of the date of this filing. Based on the current brokers’ opinion of value, the fair value of the two communities is below our carrying value. We performed a recoverability test on the Portfolio in accordance with Accounting Standards Codification (“ASC”) Topic 360, Property Plant, and Equipment (“ASC 360”). As of September 30, 2026, the lowest level of identifiable cash flows is the Portfolio, as the master lease provides for a single rent payment covering all seven properties without allocation by property, and the properties are cross-defaulted. As a result, the cash flows we receive from any one property are not largely independent of the cash flows from other
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properties under the master lease. Therefore, in accordance with ASC 360-10-35-23, we assessed recoverability of the aggregate net carrying value of the Portfolio at September 30, 2026, and concluded that the Portfolio’s weighted average estimated undiscounted cash flows exceed its carrying value. If the master lease is subsequently amended to remove the two communities that are being marketed for sale, we will reassess these communities on a stand-alone basis for impairment and evaluate whether they meet the criteria for classification as held-for-sale at that time.
2026 Activities Overview
During the nine months ended September 30, 2026, we continued to expand our SHOP segment. Accordingly, we acquired 17 seniors housing communities within our SHOP segment for $737.3 million. Also, we terminated two additional triple-net master leases and converted four seniors housing communities covered under these master leases into our SHOP segment. Upon conversion, we entered into management agreements with two operators new to us. The communities are located in Georgia, South Carolina and Texas (2) with a total of 247 units and an aggregate gross book value of $59.9 million. As of September 30, 2026, our SHOP segment represented 49.0% of our gross portfolio investments and was comprised of 46 seniors housing communities managed on our behalf by 13 independent operators pursuant to separate management agreements.
The following table summarizes acquisitions within our SHOP segment during the nine months ended September 30, 2026 (dollar amounts in thousands):
(2)
During the nine months ended September 30, 2026, we funded capital improvement projects of $9.7 million within our SHOP segment.
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The following table provides information related to our triple-net lease extensions during the nine months ended September 30, 2026 (dollar amounts in thousands):
During the nine months ended September 30, 2026, we terminated two triple-net master leases and converted four seniors housing communities covered under the master leases into our SHOP segment. Upon conversion, we entered into management agreements with two independent operators. The communities are located in Georgia, South Carolina and Texas (2) with a total of 247 units and an aggregate gross book value of $59.9 million.
Additionally, as a result of the sale of 19 skilled nursing centers and 17 seniors housing communities within our Triple-Net Portfolio, we terminated master lease agreements with five operators during the nine months ended September 30, 2026. In connection with the sale of 17 seniors housing communities, we received a lease termination fee of $2.6 million during the nine months ended September 30, 2026. The following table summarizes property sales during the nine months ended September 30, 2026 (dollar amounts in thousands):
Gain (1)
During the three months ended September 30, 2026, we performed recoverability analysis on the carrying value of the community listed in the table below and concluded that its carrying value will not be recoverable through future undiscounted cash flows. The following table summarizes information regarding impairment losses recorded during the nine months ended September 30, 2026 (dollar amounts in thousands):
(1)
During the nine months ended September 30, 2026, we invested in the following improvement projects within our Triple-Net Portfolio (in thousands):
The following table summarizes our financing receivable activity for the nine months ended September 30, 2026 (in thousands):
(1) (2)
Net decrease in financing receivables
The following table summarizes our mortgage loan receivable activity for the nine months ended September 30, 2026 (in thousands):
We had a $12.7 million mortgage loan with a carrying value of $12.6 million. The acquisition, development and construction (“ADC”) loan, secured by a 104-bed skilled nursing center in Texas met the accounting criteria to be considered a variable interest entity (“VIE”). We were not the primary beneficiary of the VIE as we did not have both: 1) the power to direct the activities that most significantly affect the VIE’s economic performance, and 2) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE. However, we had significant influence over the VIE. Therefore, we accounted for the investment as a joint venture using the equity method of accounting. During the three months ended June 30, 2026, the mortgage loan was paid off.
Health Care Regulatory
The Centers for Medicare & Medicaid Services (“CMS”) annually updates Medicare SNF prospective payment system rates and other policies. On July 29, 2026, CMS issued a final rule to update Medicare payment policies and rates for SNFs under the SNF prospective payment system (“SNF PPS”) for fiscal year (“FY”) 2027. For FY 2027, CMS announced that it was updating SNF PPS rates by 2.4% based on the final SNF market basket of 3.3%, reduced by a 0.9% productivity adjustment, for an estimated increase of $882.74 million in aggregate payments to SNFs. CMS also announced FY 2027 updates to the SNF Quality Reporting Program (“QRP”). Specifically, CMS announced it was finalizing the removal of two measures from the QRP, beginning with the FY 2028 SNF QRP: (1) the COVID-19 Vaccination Coverage Among Healthcare Personnel measure, and (2) the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date measure. CMS also announced that it was finalizing the revised data submission deadline from 4.5 months to no later than the 15th day of the second month after the end of the quarter (approximately 45 days), beginning with FY 2029 SNF QRP. CMS also stated that to obtain the most accurate SNF quality of care information and to remain relevant to the SNF community and consumers, CMS was finalizing a requirement for all SNFs to submit minimum data set (“MDS”)
data for all SNF residents receiving covered skilled care, regardless of payer. CMS also announced FY 2027 Final Updates to the SNF Value-Based Purchasing (“VBP”) program. Specifically, CMS finalized performance standards for the FY 2029 and FY 2030 program years to comply with the program’s statutory notice deadline. CMS stated it will update the “snapshot date” codified at 42 CFR § 413.338(f)(1)(v) for two measures calculated using MDS assessment data to maintain alignment with the newly finalized SNF QRP submission deadlines for MDS assessment data, beginning with FY 2027 data. CMS also stated that the SNF VBP adjustments for certain SNFs subject to the net reduction in payments under the SNF VBP and which are not incorporated into the impact estimates for the payment rate are an estimated $203.60 million reduction in FY 2027.
On October 23, 2026, CMS and States launched a $275 million initiative to recruit and retain nurses in nursing homes. Nursing students and licensed nurses interested in working in a nursing home may now qualify for up to $40,000 in student loan repayment and/or a $10,000 stipend in exchange for a three-year commitment to serve in a qualifying nursing home in a rural or higher labor-shortage area. To receive payments, nurses accepted into Nurses for Nursing Homes must: (i) hold an active RN or LPN/LVN license at the time that the candidate begins their employment; (ii) work at least 30 hours per week at a qualifying nursing home; (iii) have eligible student loan debt; or for those without student loan debt, have graduated within the past two years to qualify for a stipend; (iv) not have worked in a nursing home for at least 60 days before opening an application account and starting an application. During the first 90 days of the initiative (Oct. 26, 2026, to Jan. 24, 2027), an exception applies to RNs and LPNs/LVNs who began working in an eligible nursing home between July 28, 2026, through Oct. 25, 2026; and (v) commit to three years of service at an eligible Medicare-, Medicaid-, or dually certified long-term care facility.
In October 2026, HHS-OIG posted the results of an audit of four states that had established minimum spending requirements related to resident care for nursing homes. According to Medicaid payment transparency reporting requirements, beginning in 2028, States must report to CMS annually, by facility, the percentage of Medicaid payments that are spent on compensation for direct care workers and support staff for services provided by Medicaid-certified nursing facilities (nursing homes). The audit determined how the four States have implemented nursing home minimum spending requirements related to resident care and identified challenges that the four States and selected nursing homes in those States have experienced in implementing and complying with those requirements. HHS-OIG found that each of the four States implemented its own nursing home minimum spending requirements related to resident care. Specifically, according to HHS-OIG, each State required nursing homes to spend at least a set percentage of revenues, expenses, or costs on resident care (i.e., minimum spending threshold) and calculated the spending percentage using different financial figures. HHS-OIG stated that three of the four States identified challenges that they experienced in implementing minimum spending requirements, such as difficulties in collecting data from nursing homes and a lack of audited data to calculate the minimum spending percentages. In addition, according to HHS-OIG, there were some selected nursing homes in each of the four States that experienced challenges in complying with the requirements, such as staffing shortages and difficulties in gathering and reporting the required data to the State due to time constraints. HHS-OIG recommended that CMS consider the information in this report as it implements Federal Medicaid payment transparency reporting requirements for nursing homes, and in any future rulemaking, should it decide to implement a minimum spending requirement. CMS concurred with HHS-OIG’s recommendation.
There can be no assurance that these rules or future regulations modifying Medicare SNF payment rates or other requirements for Medicare and/or Medicaid participation will not have an adverse effect on the financial condition of our lessees and borrowers which could, in turn, adversely impact the timing or level of their payments to us and our overall financial condition. Failure by an operator to comply with regulatory requirements can, among other things, jeopardize a facility’s compliance with the
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conditions of participation under relevant federal and state healthcare programs. Further the ability of our operators to comply with applicable regulations can be adversely impacted by changes in the labor market and increases in inflation.
Key Performance Indicators, Trends and Uncertainties
We utilize several key performance indicators to evaluate the various aspects of our business. These indicators are discussed below and relate to concentration risk and credit strength. Management uses these key performance indicators to facilitate internal and external comparisons to our historical operating results in making operating decisions and for budget planning purposes.
Concentration Risk. We evaluate a tenant/operator concentration based on whether revenues from transactions with a single external operator equal or exceed 10% of our total revenues. No single operator accounted for 10% or more of total revenues for the nine months ended September 30, 2026.
Additionally, we evaluate our concentration risk based on gross investment across asset mix, real estate investment mix, operator mix and geographic mix. Concentration risk is valuable to understand what portion of our real estate investments could be at risk if certain sectors were to experience downturns. Asset mix measures the portion of our investments that are real property or mortgage loans. The National Association of Real Estate Investment Trusts (“Nareit”), an organization representing U.S. REITs and publicly traded real estate companies, classifies a company with 50% or more of assets directly or indirectly in the equity ownership of real estate as an equity REIT. Investment mix measures the portion of our investments that relate to our various property classifications. Operator mix measures the portion of our investments that relate to our top five operators. Geographic mix measures the portion of our real estate investment that relate to our top five states.
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The following table reflects our recent historical trends of concentration risk (gross investment, in thousands):
9/30/26
6/30/26
3/31/26
12/31/25
9/30/25
Asset mix:
982,820
1,019,948
1,045,400
1,149,924
801,022
701,612
565,265
446,527
286,916
286,857
363,088
362,201
Mortgage loan receivables
396,092
393,389
385,511
393,587
25,728
25,816
25,874
27,010
18,342
Real estate investment mix:
Senior housing communities (1)
1,703,043
1,632,667
1,513,832
1,441,811
Skilled nursing centers
777,530
795,508
871,825
943,775
Under development (1)
Operator mix:
ALG Senior Living
298,749
297,932
297,607
297,292
296,405
Prestige Healthcare (2)
267,294
267,797
267,854
267,982
268,534
Encore Senior Living
220,709
215,911
213,584
206,429
199,187
Carespring Health Care Management, LLC
102,940
Ignite Medical Resorts (3)
89,054
101,612
101,578
101,056
Remaining operators (3)
448,576
717,922
754,971
856,176
982,942
SHOP operators (4)
Geographic mix:
361,655
320,593
320,317
319,951
288,933
304,766
304,031
303,706
303,391
302,504
Minnesota (5)
Michigan
294,147
294,649
294,466
293,954
293,889
148,036
146,778
38,162
15,148
Remaining states (5)
1,393,678
1,425,269
1,374,913
1,442,204
1,497,117
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Credit Strength. We measure our credit strength both in terms of leverage ratios and coverage ratios. Our leverage ratios include debt to gross asset value and debt to market capitalization. The leverage ratios indicate how much of our Consolidated Balance Sheets capitalization is related to long-term obligations. Our coverage ratios include interest coverage ratio and fixed charge coverage ratio. The coverage ratios indicate our ability to service interest and fixed charges (interest). The coverage ratios are based on earnings before interest, taxes, depreciation and amortization for real estate (“EBITDAre”) as defined by Nareit. See Non-GAAP Financial Measures below for information and reconciliation.
The following table reflects the recent historical trends for our credit strength measures:
Balance Sheet Metrics
Year to Date
Quarter Ended
Debt to gross asset value
32.0
29.7
34.3
34.0
(8)
38.1
Debt to market capitalization ratio
29.5
27.3
31.9
(7)
33.6
(9)
35.1
Interest coverage ratio (10)
4.6
x
4.3
4.4
(3)
4.8
Fixed charge coverage ratio (10)
We evaluate our key performance indicators in conjunction with current expectations to determine if historical trends are indicative of future results. Our expected results may not be achieved, and actual results may differ materially from our expectations. This may be a result of various factors, including, but not limited to:
Management regularly monitors the economic and other factors listed above. We develop strategic and tactical plans designed to improve performance and maximize our competitive position. Our
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ability to achieve our financial objectives is dependent upon our ability to effectively execute these plans and to appropriately respond to emerging economic and company-specific trends.
Operating Results (unaudited, in thousands)
Difference
48,336
(337)
(1,452)
533
(1,124)
45,956
(33,446)
(2,521)
(4,731)
156
(578)
594
(602)
(1,983)
(10)
324,686
(11)
(439)
(356)
367,864
277
Net income (loss) attributable to LTC Properties, Inc.
368,141
(1,618)
366,523
52
142,103
(9,629)
(1,643)
2,218
(2,094)
130,955
(103,124)
(6,860)
(11,143)
4,252
4,692
(12)
2,001
(13)
(1,927)
(14)
(72,964)
(15)
(16)
331,735
(4,147)
(17)
(713)
384,866
733
Net income attributable to LTC Properties, Inc.
385,599
Net income available to common stockholders
383,953
Non-GAAP Financial Measures
A non-GAAP financial measure is defined as a numerical measure of a registrant’s historical or future financial performance, financial position or cash flows that excludes or includes amounts that are not excluded from or included in the most directly comparable measure calculated and presented in accordance with GAAP. We consider Funds from Operations (“FFO”), Net Operating Income (“NOI”) and Earnings before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”) to be useful supplemental measures of our financial or operating performance.
Funds From Operations
FFO attributable to common stockholders is a supplemental measure of a REIT’s financial performance that is not defined by GAAP. Real estate values historically rise and fall with market conditions, but cost accounting for real estate assets in accordance with GAAP assumes that the value of real estate assets diminishes predictably over time. We believe that by excluding the effect of historical cost depreciation, FFO helps facilitate meaningful comparisons of operating performance between periods. FFO is also useful to reflect the operating efficiency of the Company and provides a real estate industry baseline for comparison among REITs.
We use FFO as a supplemental performance measurement of our operating performance. FFO does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs. FFO should not be considered an alternative to net income available to common stockholders.
We calculate and report FFO in accordance with the definition and interpretive guidelines issued by Nareit. FFO, as defined by Nareit, means net income (loss) available to common stockholders (computed in accordance with GAAP) excluding the impact of real estate depreciation and amortization, gains or losses on the sale of real estate, impairment write-downs of depreciable real estate, unconsolidated partnerships and joint ventures. Our calculation of FFO may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current Nareit definition or that have a different interpretation of the current Nareit definition from us. Therefore, caution should be exercised when comparing our FFO to that of other REITs.
The following table reconciles GAAP net income available to common stockholders to Nareit FFO available to common stockholders (unaudited, amounts in thousands, except per share amounts):
GAAP net income (loss) attributable to LTC Properties, Inc. stockholders
(323,948)
Nareit FFO attributable to LTC Properties, Inc. stockholders
40,226
(10,270)
110,254
42,937
Nareit FFO available to common stockholders
40,069
(10,424)
109,783
42,466
(48)
(114)
FFO allocated to common stockholders
40,021
109,669
Diluted Nareit FFO attributable to common stockholders
109,670
Weighted average shares used to calculate Nareit FFO per share:
Shares for diluted FFO per share
Net Operating Income
NOI is a non-GAAP financial measure that is calculated as net income (loss) available to common stockholders (computed in accordance with GAAP) excluding the impact of general and administrative expenses, transaction costs, write-off of effective interest, provision for (recovery of) credit losses, impairment loss, depreciation and amortization, interest expense, gain or loss on sale of real estate and income tax provision (benefit). We use NOI to reflect the operating performance of our portfolio because NOI excludes certain items that are not associated with the operations of our properties.
NOI is not equivalent to our net income (loss) available to common stockholders as determined under GAAP. Additionally, our use of the term NOI may not be comparable to that of other real estate companies as they may have different methodologies for computing NOI. Therefore, caution should be exercised when comparing our NOI to that of other REITs.
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The following is a reconciliation of net income (loss), which is the most directly comparable GAAP financial measure to NOI for the three and nine months ended September 30, 2026 and 2025 (in thousands):
Income tax provision (benefit)
398
General and administrative expense
Write-off of effective interest
Earnings before Interest, Taxes, Depreciation and Amortization for Real Estate
EBITDAre is calculated as net income (loss) available to common stockholders (computed in accordance with GAAP) excluding the impact of interest expense, income tax provision (benefit), real estate depreciation and amortization, impairment write-downs of depreciable real estate, gains or losses on the sale of depreciable real estate, and our related share of unconsolidated partnerships and joint ventures.
Adjusted EBITDAre is a supplemental non-GAAP financial measure calculated by excluding the impact of non-core adjustments unrelated to ongoing operations.
We believe EBITDAre and Adjusted EBITDAre provide useful information to investors because they exclude the impact of various income and expense items that are not indicative of operating performance. These metrics are not alternatives to net income, operating income or cash flows from operating activities as calculated and presented in accordance with GAAP. You should not rely on EBITDAre or Adjusted EBITDAre as substitutes for any such GAAP financial measures or consider them in isolation, for the purpose of analyzing our financial performance, financial position or cash flows. Net income (loss) available to common stockholders is the most directly comparable GAAP measure to EBITDAre and/or Adjusted EBITDAre.
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The following is a reconciliation of net income (loss), which is the most directly comparable GAAP financial measure to EBITDAre and Adjusted EBITDAre for the periods presented below (in thousands):
103,651
(Gain) Loss on sale of real estate, net
(7,562)
(78,057)
166
110
218
9,484
10,782
10,588
12,371
11,979
10,949
EBITDAre
146,225
53,114
45,274
47,837
47,349
Non-core adjustments
(1,918)
(1,416)
1,189
(1,691)
(1,051)
42,418
Adjusted EBITDAre
144,307
51,698
46,463
46,146
46,298
42,436
Interest coverage ratio
Total fixed charges
Fixed charge coverage ratio
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Liquidity and Capital Resources
Sources and Uses of Cash
As of September 30, 2026, we had $1.1 billion in liquidity as follows (amounts in thousands):
Available under unsecured revolving line of credit
Available under Equity Distribution Agreement
461,140
Total Liquidity
1,114,223
We believe that our current cash balance, cash flow from operations available for distribution or reinvestment, our borrowing capacity and our potential ability to access the capital markets are sufficient to provide for payment of our current operating costs, meet debt obligations and pay common dividends at least sufficient to maintain our REIT status and repay borrowings at, or prior to, their maturity. The timing, source and amount of cash flows used in financing and investing activities are sensitive to the capital markets environment, especially to changes in interest rates. In addition, inflation may adversely affect the performance of our SHOP segment and our operators’ business, results of operations, cash flows and financial condition which could, in turn, adversely affect our financial position.
The operating results of the facilities will be impacted by various factors over which the operators/owners may have no control. Those factors include, without limitation, the health of the economy, inflation pressures, employee availability and cost, changes in supply of or demand for competing seniors housing and health care facilities, ability to hire and maintain qualified staff, ability to control other rising operating costs, the potential for significant reforms in the health care industry, and related occupancy challenges that could be faced by our industry or in the markets where our properties are located. In addition, our future growth and net income may be adversely impacted by changes in the governmental regulations and financing of the health care industry or the impact of infectious disease and epidemic outbreaks. We cannot presently predict what impact these potential events may have, if any. We believe that adequate provision has been made for the possibility of loans proving uncollectible, but we will continually evaluate the financial condition of the operations of our seniors housing and health care properties. In addition, we will monitor our borrowers and the underlying collateral for mortgage loans and will make future revisions to the provision, if considered necessary.
Our ability to access the capital markets and to pay dividends may be impacted by our borrowing capacity and compliance with financial covenants. We continuously evaluate the availability of cost-effective capital and believe we have sufficient liquidity for our current dividend, corporate expenses and additional capital investments in 2026 and 2027.
Our investments, principally our investments in owned properties, financing receivables and mortgage loans, are subject to the possibility of loss of their carrying values as a result of changes in market prices, interest rates and inflationary expectations. The effects on interest rates may affect our costs of financing our operations and the fair-market value of our financial assets. Generally, our leases have agreed upon annual increases and our loans have predetermined increases in interest rates. Inasmuch as we may initially fund some of our investments with variable interest rate debt, we would be at risk of net interest margin deterioration if medium and long-term rates were to increase.
Our primary sources of cash include resident fees and services, rent, interest receipts, borrowings under our unsecured credit facility, public and private issuances of debt and equity securities, proceeds from investment dispositions and principal payments on loans receivable. Our primary uses of cash include dividend distributions, debt service payments (including principal and interest), seniors housing operating expenses, property tax expenses, real property investments (including acquisitions, capital expenditures and construction advances), loan advances and general and administrative expenses. These sources and uses of cash are reflected in our Consolidated Statements of Cash Flows as summarized below (in thousands):
Change
Net cash provided by (used in):
Operating activities
8,384
Investing activities
98,336
Financing activities
53,357
160,077
4,973
165,050
Cash Flows from Operating Activities
Cash flows from operating activities increased $8.4 million during the nine months ended September 30, 2026, compared to the same period in 2025, primarily due to net income generated from growth in our SHOP segment.
Cash Flows from Investing Activities
Net cash used in investing activities decreased by $98.3 million during the nine months ended September 30, 2026, compared to the same period in 2025, primarily due to a $464.2 million increase in proceeds from the sale of real estate, an $83.7 million decrease in investments in mortgage loans receivable, and a $62.2 million increase in proceeds from the sale of properties accounted for as financing receivables, partially offset by a $469.7 million increase in real estate investments, a $21.1 million decrease in principal payments received on mortgage loans receivable, and a $17.2 million decrease in principal payments received on notes receivable.
Cash Flows from Financing Activities
Net cash provided by financing activities increased by $53.4 million during the nine months ended September 30, 2026, compared to the same period in 2025, primarily driven by a $177.5 million increase in net proceeds from issuance of common stock and a $110.0 million decrease in repayment of debt, partially offset by a $227.1 million decrease in net borrowings under our revolving line of credit and a $9.8 million increase in distributions paid to stockholders.
Unsecured Credit Facility. We had an unsecured credit agreement (the “Credit Agreement”) that provided for an aggregate commitment of the lenders of up to $800.0 million comprised of a $600.0 million revolving credit facility (the “Revolving Line of Credit”) and term loans totaling $200.0 million (the “Term Loans”). The Term Loans consist of $50.0 million, $55.0 million, $55.0 million and $40.0 million borrowings, with contractual maturities of three, four, five and seven years, respectively. The Credit Agreement provided for the opportunity to increase the total commitment to an aggregate $1.2 billion (the “Accordion”) and allowed for a one-year extension option, subject to customary conditions.
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During the second quarter of 2026, we entered into an amendment to the Credit Agreement (the “Amended Credit Agreement”) to increase the aggregate commitment of its lenders by $300.0 million to a total of $1.1 billion, through the exercise of the Credit Agreement’s accordion feature. The $300.0 million increase expands our aggregate revolving credit (the “Amended Revolving Line of Credit”) commitment to $900.0 million. Additionally, the Amended Credit Agreement increases the Accordion feature up to $2.0 billion (the “Amended Accordion”). The material terms of the Amended Credit Agreement remain unchanged.
Interest Rate Swap Agreements. During 2025, we entered into interest rate swaps with maturities of three, four, five and seven years, respectively to effectively lock-in the forecasted interest payments on the Term Loans. Additionally, during the second quarter of 2026, we entered into three-year interest rate swap agreements to effectively fix the interest rate on $150.0 million of borrowings under our Amended Revolving Line of Credit. Our interest rate swaps are considered cash flow hedges and are recorded on our Consolidated Balance Sheets at fair value in Prepaid expenses and other assets, with cumulative changes in the fair value of these instruments recognized in Accumulated other comprehensive income (loss) on our Consolidated Balance Sheets. During the nine months ended September 30, 2026, we recorded an increase of $11.1 million to the fair value of our interest rate swaps.
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The debt obligations by component as of September 30, 2026 are as follows (dollar amounts in thousands):
During the nine months ended September 30, 2026, our debt borrowings and repayments were as follows (in thousands):
At September 30, 2026, we had 54,819,683 shares of common stock outstanding, total equity on our balance sheet was $1.7 billion and our equity securities had a market value of $2.4 billion. During the nine months ended September 30, 2026, we declared and paid $89.8 million of cash dividends.
During the nine months ended September 30, 2026, we acquired 149,745 shares of common stock held by employees who tendered owned shares to satisfy tax withholding obligations.
Subsequent to September 30, 2026, we declared a monthly cash dividend of $0.19 per share on our common stock for the months of October, November and December 2026, payable on October 30, November 30, and December 31, 2026, respectively, to stockholders of record on October 22, November 20, and December 23, 2026, respectively.
At-The-Market Program. We had an equity distribution agreement (the “Original Equity Distribution Agreement”) to offer and sell, from time to time, up to $400.0 million in aggregate offering price of shares of our common stock. The Equity Distribution Agreement provides for sales of common shares to be made by means of ordinary brokers’ transactions, which may include block trades, or transactions that are deemed to be “at the market” offerings.
During the nine months ended September 30, 2026, we sold 5,257,220 shares of common stock for $198.1 million in net proceeds under our Original Equity Distribution Agreement. Additionally, we incurred $0.2 million of costs associated with this agreement which have been recorded in additional paid in capital as a reduction of proceeds received.
During the third quarter of 2026, we terminated our Original Equity Distribution Agreement and entered into a new equity distribution agreement (the “Equity Distribution Agreement”) to sell from time to time, up to $500.0 million in aggregate offering price of shares of our common stock. The Equity Distribution Agreement provides for sale of common shares to be made by means of ordinary brokers’ transactions, which may include block trades, or transactions that are deemed to be “at the market” offerings.
During the third quarter of 2026, we sold 914,120 shares of common stock for $38.7 million in net proceeds under the Equity Distribution Agreement. In conjunction with the sale of common stock, we incurred $0.2 million of costs associated with this agreement, which has been recorded in additional paid in capital as a reduction of proceeds received. At September 30, 2026, we had $461.1 million available under the Equity Distribution Agreement. Subsequent to September 30, 2026, we sold 1,371,986 shares of common stock for $58.7 million in net proceeds under the Equity Distribution Agreement. Accordingly, at November 3, 2026, we have $401.9 million available under the Equity Distribution Agreement.
Available Shelf Registrations. We have an automatic shelf registration statement on file with the SEC and currently have the ability to file additional automatic shelf registration statements to provide us with capacity to publicly offer an indeterminate amount of common stock, preferred stock, warrants, debt, depositary shares, or units. We may from time to time raise capital under our automatic registration statement in amounts, at prices, and on terms to be announced when and if the securities are offered. The specifics of any future offerings, along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of the offering. Our shelf registration statement expires in November 2027.
Stock-Based Compensation. During 2021, we adopted and our shareholders approved the 2021 Equity Participation Plan (“the 2021 Plan”), which replaced the 2015 Equity Participation Plan (“the 2015 Plan”). Under the 2021 Plan, 1,900,000 shares of common stock have been authorized and reserved for awards, less one share for every one share that was subject to an award granted under the 2015 Plan after December 31, 2020 and prior to adoption. In addition, any shares that are not issued under outstanding awards under the 2015 Plan because the shares were forfeited or cancelled after December 31, 2020 will be added to and again be available for awards under the 2021 Plan. Under the 2021 Plan, the shares were authorized and reserved for awards to officers, employees, non-employee directors and consultants. The
terms of the awards granted under the 2021 Plan and the 2015 Plan are set by our compensation committee at its discretion. Beginning in the first quarter of 2024, we entered into Performance Stock Unit Award Agreements, based upon absolute and relative total shareholder return, under the 2021 Plan.
During the nine months ended September 30, 2026, 140,801 shares of restricted stock and 170,827 performance-based stock units vested. During the nine months ended September 30, 2026, we awarded restricted stock and performance-based stock units as follows:
Award Type
Critical Accounting Policies
Our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q are prepared in conformity with U.S. generally accepted accounting principles for interim financial information set forth in the Accounting Standards Codification as published by the Financial Accounting Standards Board, which require us to make estimates and assumptions regarding future events that affect the amounts reported in our financial statements and accompanying footnotes. We base these estimates on our experience and assumptions regarding future events we believe to be reasonable under the circumstances. Actual results could differ from those estimates and such differences may be material to the consolidated financial statements. We have described our most critical accounting policies in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes to our critical accounting policies or estimates since December 31, 2025.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There were no material changes in our market risk during the nine months ended September 30, 2026. For additional information, refer to Item 7A as presented in our Annual Report on Form 10-K for the year ended December 31, 2025.
Item 4. CONTROLS AND PROCEDURES
Our management, with the participation of our Co-Chief Executive Officers and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on such evaluation our Co-Chief Executive Officers and Chief Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective.
There has not been any change in our internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15(d) and 15d-15(d) under the Exchange Act that
occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
We are and may become from time to time a party to various claims and lawsuits arising in the ordinary course of business, which in our opinion are not singularly or in the aggregate anticipated to be material to our results of operations or financial condition. Claims and lawsuits may include matters involving general or professional liability asserted against the lessees or borrowers related to our properties, which we believe under applicable legal principles are not our responsibility as a non-possessory landlord or mortgage holder. We believe that these matters are the responsibility of our lessees and borrowers pursuant to general legal principles and pursuant to insurance and indemnification provisions in the applicable leases or mortgages. We intend to continue to vigorously defend such claims and lawsuits.
Item 1A. RISK FACTORS
There have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None
Item 5. OTHER INFORMATION
Insider Trading Arrangements
During the nine months ended September 30, 2026, none of our directors or executive officers adopted, modified or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” as such terms are defined under Item 408 of Regulation S-K.
Item 6. EXHIBITS
3.1
LTC Properties, Inc. Articles of Amendment and Restatement (incorporated by reference to Exhibit 3.1 to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025)
Bylaws of LTC Properties, Inc. (incorporated by reference to Exhibit 3.2 to the registrant’s Current Report on Form 8-K filed May 26, 2023)
10.1
Equity Distribution Agreement, dated August 6, 2026, by and among LTC Properties, Inc. and Citizens JMP Securities, LLC, KeyBanc Capital Markets Inc., Wells Fargo Bank, National Association, Huntington Securities, Inc., Royal Bank of Canada, and Nomura Global Financial Products, Inc., as forward purchasers, and Citizens JMP Securities, LLC, KeyBanc Capital Markets Inc., Wells Fargo Securities, LLC, Huntington Securities, Inc., RBC Capital Markets, LLC, BTIG, LLC, Nomura Securities International, Inc., and M&T Securities, Inc., as principals, sales agents and/or forward sellers, as applicable (incorporated by reference to Exhibit 1.1 to the registrant’s Current Report on Form 8-K filed August 6, 2026)
31.1
Certification of the Co-Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2
31.3
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS
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101.SCH
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101.CAL
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101.DEF
Inline XBRL Taxonomy Extension Definitions Linkbase Document
101.LAB
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant
Dated: November 3, 2026
By:
/s/ Caroline Chikhale
Caroline Chikhale
Executive Vice President, Chief Financial Officer, Treasurer and Corporate Secretary
(Principal Financial Officer)