On June 1, 2026, we completed a transaction with ScionHealth ("Scion"), Lifepoint Health, Inc. ("Lifepoint"), and Lifepoint Behavioral Health ("Lifepoint Behavioral") (the "Scion/Lifepoint Transaction"), as further described in this same Note 3 under the "Other Leasing Activities" subheading. As part of the transaction, we acquired one property in Kentucky valued at $165.5 million as part of a property exchange described below under the "Disposals" subheading of this Note 3. The property is leased to Lifepoint pursuant to a long-term master lease with annual inflation-based escalators.

During the first quarter of 2026, we closed on the acquisition of one property in Germany for approximately €23 million (along with real estate transfer tax) leased to Median Kliniken S.à r.l ("MEDIAN") pursuant to a long-term lease with annual inflation-based escalators.

In April 2025, we invested approximately CHF 50 million (CHF 25 million of which was a short-term loan and repaid in the 2026 third quarter) in the Swiss Medical Network real estate joint venture (also known as Infracore), proceeds of which, along with fundings from our joint venture partner, were used to facilitate the acquisition of a general acute care facility.

In 2025, we funded approximately $47 million to Steward Health Care System's ("Steward") secured lender to obtain control over certain real estate assets.

We have two other development projects ongoing in Texas (Texarkana development) and Massachusetts (Norwood redevelopment). These are not highlighted above; however, we have completed construction to the stage where the buildings are "weathered in" and environmentally secure so as to physically protect our investment while we actively market the hospitals for sale or lease. As of September 30, 2026, we estimate that the cost of additional construction that we believe will be more efficient if completed in the near-term (such as electing to accelerate completion of a parking structure and elevators at Norwood) approximates between $5 million and $8 million.

During the third quarter of 2026, we completed construction and began recording rental income on a $45 million facility in Alicante, Spain. This newly built facility is leased to IMED.

During the first quarter of 2026, we completed construction and began recording rental income on a $10.7 million capital addition project at an Avondale, Arizona facility leased to Lifepoint Behavioral.

During the third quarter of 2025, we completed construction and began recording rental income on two projects totaling approximately $36 million, one of which is leased to Lifepoint Behavioral and the other to Surgery Partners.

During the first quarter of 2025, we completed construction and began recording rental income on a $10.5 million capital addition project at a Gilbert, Arizona facility leased to Lifepoint Behavioral.

On September 16, 2026, we completed the sale of two facilities in Idaho to affiliates of Intermountain Health for gross proceeds to us of $371 million. This transaction resulted in a net gain of approximately $159 million.

On June 1, 2026, we completed the Scion/Lifepoint Transaction as further described in this same Note 3 under the "Other Leasing Activities" subheading. As part of the transaction, we completed a property exchange, which resulted in the transfer of three facilities back to Scion in exchange for the Kentucky property noted previously in this same Note 3 under the "New Investments" subheading. The transaction, which included the satisfaction of the lease incentive from the 2025 transaction with the tenant, resulted in a net gain of approximately $6.8 million.

During the first nine months of 2026, we also completed the sale of five facilities for total proceeds of approximately $31 million, of which $12 million was received in advance of the sale in the first quarter of 2025, resulting in a loss of approximately $1 million.

During the first nine months of 2025, we completed the sale of five facilities (including two former Steward-operated facilities that were being leased to College Health) and an ancillary facility for aggregate proceeds of approximately $100 million, resulting in a net gain of approximately $4 million.

We acquire and develop healthcare facilities and lease the facilities to healthcare operating companies. The initial fixed lease terms of these infrastructure-type assets are typically at least 15 years, and most include renewal options at the election of our tenants, generally in five-year increments. Over 99% of our leases provide annual rent escalations based on increases in the Consumer Price Index ("CPI") (or similar indices outside the U.S.) and/or fixed minimum annual rent escalations. Many of our domestic leases contain purchase options with pricing set at various terms but in no case less than our total initial investment. Our leases typically require the tenant to handle and bear most of the costs associated with our properties including repair/maintenance, property taxes, and insurance.

For all of our properties subject to lease, we are the legal owner of the property and the tenant's right to use and possess such property is guided by the terms of a lease. At September 30, 2026, we account for all of these leases as operating leases, except where GAAP requires alternative classification, including leases on certain Ernest Health, Inc. ("Ernest") facilities that are accounted for as

either direct financing or other financing type leases. The components of our total investment in financing leases consisted of the following (in thousands):

At September 30, 2026, our vacant properties (with a net book value of approximately 4% of our total assets), including two developments (see "Development and Capital Addition Activities" above), are in various stages of being re-tenanted or sold.

Our tenants’ financial performance and resulting ability to satisfy their lease and loan obligations to us are material to our financial results and our ability to service our debt and make distributions to our stockholders. Our tenants operate in the healthcare industry, which is highly regulated, and changes in regulation (or delays in enacting regulation) may temporarily impact our tenants’ operations until they are able to make the appropriate adjustments to their business. In addition, our tenants may experience operational challenges from time-to-time as a result of many factors, including those external to them, such as cybersecurity attacks, public health crises, economic issues resulting in high inflation and spikes in labor costs, extreme or severe weather and climate-related events, and adverse market and political conditions. We monitor our tenants' operating results and the potential impact from these challenges. We may elect to provide support to our tenants from time-to-time in the form of short-term rent abatements or rent deferrals to be paid back in full, or in the form of temporary loans. See below for an update on some of our tenants.

Effective July 1, 2026, we agreed to a lease amendment that included a cash rent reduction of approximately £11 million annually to Priory due to the decline in referrals over the past year or so by the National Health Service in the U.K. for the treatment of inpatient mental health services. This lease amendment also added a variable rent component to recapture some or all of the rent reduction if Priory were to reach certain revenue hurdles. We have also effectively extended the lease term by an additional ten years, and made certain other amendments to our lease and security agreements. This lease will continue to be classified as an operating lease and no material change is expected from a total revenue perspective.

On June 1, 2026, we completed the Scion/Lifepoint Transaction which included (i) our acquisition of a new property from Lifepoint (as previously described in this same Note 3 under the "New Investments" subheading) in exchange for three Scion properties (as previously described in this same Note 3 under the "Disposals" subheading), (ii) the transition of hospital operations of two of our other facilities from Scion to Lifepoint, and (iii) the execution of a combined single master lease covering properties leased to Lifepoint and Lifepoint Behavioral. The new master lease has a lease term ending in 2045, annual cash rents approximating 99% of such rents prior to this transaction, and includes lease escalator provisions. The master lease is guaranteed by Lima Holdco, LLC and Springstone Health Opco, LLC, the parent companies of the individual lessees.

In August 2019, we invested in a portfolio of 14 acute care hospitals in three states (California, Pennsylvania, and Connecticut) operated by and master leased to or mortgaged by Prospect Medical Holdings, Inc. ("Prospect") for a combined investment of approximately $1.6 billion.

On May 23, 2023, Prospect completed a recapitalization plan, which included receiving $375 million in new financing from several lenders. Along with this new capital from third-party lenders, we agreed to the following restructuring of our then $1.7 billion investment including: a) maintaining the master lease covering six California hospitals without any changes in rental rates or escalator provisions, b) transitioning the Pennsylvania properties back to Prospect in return for a $150 million first lien mortgage, c) providing up to $75 million in a loan secured by a first lien on Prospect's accounts receivable and certain other assets, and d) obtaining a non-controlling ownership interest in PHP Holdings in exchange for unpaid rent and interest, among other things.

Prospect filed for Chapter 11 bankruptcy on January 11, 2025 with the United States Bankruptcy Court for the Northern District of Texas. On March 20, 2025, the bankruptcy court approved a global settlement (including a recovery waterfall) between us, Prospect, and other stakeholders. Due to the bankruptcy, we recorded more than $400 million of impairment charges and negative fair

value adjustments associated with our investments in Prospect in the 2024 fourth quarter, resulting in a full reserve of the asset-backed loan and our Pennsylvania mortgage loan, along with a decrease in the value in our Connecticut properties. No charge was recorded on our California properties.

In 2025 and in accordance with the global settlement and the estimated recovery waterfall, we recorded approximately $140 million of additional impairment charges (including $65 million of impairment charges in the 2025 third quarter). In determining the majority of the 2025 impairment charges, we compared the carrying value of our investments to our estimate of expected proceeds (net of any possible future cash outlays) to be received under the bankruptcy court approved recovery waterfall, factoring in an estimated recovery of Prospect assets (including our real estate assets) and applying the priority of claims associated with the bankruptcy. In estimating the fair value of the California, Pennsylvania, and certain Connecticut real estate, we, along with assistance from a third-party independent valuation firm, used a combination of cost, market, and income approaches using Level 3 inputs. The cost approach used comparable sales to value the land and cost manuals to value the improvements. The value derived from the market approach was based on sales prices of similar properties. For the income approach, we divided the expected operating income from the property by an estimated market capitalization rate (ranging from 8.25% to 8.5%). For the 2025 third quarter, we estimated the fair value of the Pennsylvania and Connecticut real estate based on received bids for these properties.

In 2025 and through the first quarter of 2026, all the Connecticut and Pennsylvania properties (along with our investment in PHP Holdings discussed below) were sold, and Prospect's bankruptcy plan was deemed effective.

During the first nine months of 2026, we received approximately $62 million from these asset sales and collection of Connecticut accounts receivable that serve as collateral for our remaining investment, while funding the $64 million bankruptcy court approved funding commitment, as disclosed in our 2025 Annual Report. At September 30, 2026, our remaining investment in Prospect is approximately $64 million. We believe this total investment is fully recoverable from the collection of remaining Connecticut accounts receivable and proceeds from litigation and other causes of action, the ultimate outcome and timing of which are uncertain.

In December 2025, we re-leased the six California properties to NOR as a result of their successful bid to acquire the hospital operations. Terms of the lease include an initial annualized rent almost identical to the previous rent amount due from Prospect in 2025, annual inflation-based escalators starting in the 2027 first quarter, and an initial fixed term of 15 years. All rent was deferred for the first six months (or until mid-June 2026), and 50% of rent is to be deferred until mid-December 2026, after which the aggregate deferred rent will be paid over the remaining lease term. Although current on its rent obligations to-date, we are accounting for rent revenue associated with the NOR lease on the cash basis and recognized $6 million in the 2026 third quarter. We have committed to fund approximately $24 million for a new emergency department at one facility and up to $60 million in seismic improvements that may be required by California regulators over the next four years, both of which will increase the lease base and result in additional rent.

In regard to our investment in PHP Holdings, we accounted for this investment using the fair value option method. In the first nine months of 2025, we recorded an approximate $147 million negative fair value adjustment (none in the 2025 third quarter). The adjustment in 2025 was made based on changes to the purchase agreement between PHP Holdings and Astrana Health and updates to PHP Holdings' working capital position. On July 1, 2025, we received $2.3 million from the sale of PHP Holdings to Astrana Health.

As discussed in previous filings, we entered into agreements in September 2024 with six operators (HSA, Honor Health, Insight Health ("Insight"), Quorum, College Health, and Tenor Health ("Tenor")) to lease 18 of the 23 former Steward-operated facilities. Since then, we have sold and/or terminated the lease on six of the facilities. These leases included a cash rent ramp up period resulting in $26.4 million of cash rent received in the first nine months of 2025 ($12 million in the 2025 third quarter), compared to $76.4 million in the first nine months of 2026 ($22 million in the 2026 third quarter). As of mid-September 2026, the rent ramp up period has ended across all of these leases. As of September 30, 2026, all rents from these operators have been received, except for cash-basis operators Insight/Tenor who represent less than 1% of our annual revenues and HSA’s September rent of approximately $10 million.

As of September 30, 2026, we have approximately $175 million, net in working capital and other loans related to these operators that were initially advanced to assist in the takeover of these operations and the transition of certain services (such as revenue cycle management). These loans are generally secured by accounts receivables and/or other assets (including personal property). For HSA, we have advanced approximately $150 million in working capital loans through September 2026, including a net $12 million in the 2026 third quarter, as HSA continues to face revenue cycle management issues. In addition, approximately $9 million of working capital loans have been repaid from the other operators through September 30, 2026. For the working capital loans to Insight/Tenor, we have recorded charges of $30 million in the first nine months of 2026 ($3 million in the 2026 third quarter), which impaired these loans to equal the fair value of the underlying collateral.

Our primary business strategy is to acquire real estate and lease to providers of healthcare services. Typically, we directly own 100% of such investments. However, from time-to-time, we will co-invest with other investors that share a similar view that hospital real estate is a necessary infrastructure-type asset in communities. In these types of investments, we will own undivided interests of less than 100% of the real estate through unconsolidated real estate joint ventures. The underlying real estate and leases in these unconsolidated real estate joint ventures are generally structured similarly and carry a similar risk profile to the rest of our real estate portfolio.

The Utah partnership applied specialized accounting and reporting for investment companies under Topic 946, which measures the underlying investments at fair value. For the three months ended September 30, 2026 and 2025, our share of the Utah partnership's favorable fair value adjustments was approximately $2.2 million and $13.0 million, respectively, while, for the nine months ended September 30, 2026 and 2025, our share was approximately $11.0 million and $34.0 million, respectively. On August 12, 2026, the five properties in the Utah partnership were sold and the partnership was effectively terminated, which generated approximately $174 million and resulted in a small gain. Since inception of the partnership, we have recognized gains in fair value (pursuant to Topic 946) aggregating approximately $73.8 million.

On July 9, 2026, Infracore SA ("Infracore"), a Swiss hospital real estate company in which we hold a non-controlling ownership interest, completed an initial public offering and listing of its shares on the SIX Swiss Exchange under the ticker symbol "INFRAC." In connection with the offering, Infracore issued approximately 3.7 million new shares at CHF 54 per share and received approximately CHF 200 million in gross proceeds. We sold approximately 0.7 million of our Infracore shares as part of the offering, realizing a small gain before transaction costs, which resulted in total gross proceeds of approximately CHF 38 million and reduced our ownership interest in Infracore from 70% to approximately 48.5%. In the 2026 third quarter, we also received another CHF 74 million from Infracore related to the repayment of an outstanding shareholder loan and payment of the 2023 and 2025 dividends.

In July 2026, Infracore completed the acquisition of a new general acute care facility for approximately CHF 110 million funded with proceeds from a mortgage loan and cash on hand. The facility will be leased to See-Spital and represents Infracore’s first sale-and-leaseback with a public hospital.

For our MEDIAN unconsolidated real estate joint venture, we, along with our joint venture partner, closed on a €702.5 million non-recourse, 10-year nonamortizing secured debt facility on June 17, 2025. The debt carries a 5.1% fixed interest rate, and the majority of the proceeds were used to fund the repayment of the prior €655 million secured loan that carried a lower interest rate.

Our investments in unconsolidated operating entities are noncontrolling investments that are typically made in conjunction with larger real estate transactions in which the operators are vetted as part of our overall underwriting process. In many cases, we would not be able to acquire the larger real estate portfolio without such investments in operators. These investments also offer the opportunity to enhance our overall return and provide for certain minority rights and protections.

We apply a forward-looking "expected loss" model to our financing receivables, including financing leases and loans, based on historical credit losses of similar instruments.

The following table summarizes the activity in our credit loss reserves (in thousands):


	For the Three Months Ended September 30,
	2026		2025
Balance at beginning of the period	$	66,264	$	564,796
Provision for credit loss, net (1)		8,696		85,111
Expected credit loss reserve written off or related to financial instruments sold, repaid, or satisfied		—		—
Balance at end of the period	$	74,960	$	649,907


	For the Nine Months Ended September 30,
	2026			2025
Balance at beginning of the year	$	553,297		$	511,473
Provision for credit loss, net (1)		47,153			138,434
Expected credit loss reserve written off or related to financial instruments sold, repaid, or satisfied (2)		(525,490	)		—
Balance at end of the period	$	74,960		$	649,907

(1)

The amount in 2026 is primarily related to loans to Tenor and Insight, whereas, the amount in 2025 is primarily related to Prospect. See "Leasing Operations (Lessor)" in this Note 3 for further discussion.

(2)

The amount in 2026 is primarily related to write-offs of previously reserved Prospect mortgages and other financing leases. See "Leasing Operations (Lessor)" in this Note 3 for further discussion.

We monitor concentration risk in several ways due to the nature of our real estate assets that are vital to the communities in which they are located and given our history of being able to replace inefficient operators of our facilities, if needed, with more effective operators. See below for our concentration details (dollars in thousands):

Total Assets by Operator


	As of September 30, 2026					As of December 31, 2025
Operators	Total Assets (1)		Percentage of Total Assets			Total Assets (1)		Percentage of Total Assets
Circle Health Ltd ("Circle")	$	2,047,298		14.2	%	$	2,121,848		14.1	%
HSA		1,268,331		8.8	%		1,200,996		8.0	%
Priory		1,267,706		8.8	%		1,301,888		8.7	%
Lifepoint Behavioral Health		783,455		5.5	%		809,492		5.4	%
Lifepoint Health		752,041		5.2	%		458,055		3.1	%
Other operators		6,198,965		43.1	%		7,103,935		47.3	%
Other assets		2,075,900		14.4	%		2,005,561		13.4	%
Total	$	14,393,696		100.0	%	$	15,001,775		100.0	%

(1)

Total assets by operator are generally comprised of real estate assets, mortgage loans, investments in unconsolidated real estate joint ventures, investments in unconsolidated operating entities, and other loans.

Total Assets by U.S. State and Country (1)


	As of September 30, 2026					As of December 31, 2025
U.S. States and Other Countries	Total Assets		Percentage of Total Assets			Total Assets		Percentage of Total Assets
Texas	$	1,342,420		9.3	%	$	1,427,391		9.5	%
California		1,019,239		7.1	%		977,890		6.5	%
Florida		938,178		6.5	%		834,940		5.6	%
Arizona		323,495		2.3	%		328,873		2.2	%
Ohio		298,358		2.1	%		330,189		2.2	%
All other states		2,091,815		14.5	%		2,480,182		16.5	%
Other domestic assets		1,130,082		7.8	%		1,072,900		7.2	%
Total U.S.	$	7,143,587		49.6	%	$	7,452,365		49.7	%
United Kingdom	$	4,050,310		28.1	%	$	4,184,188		27.9	%
Germany		738,266		5.1	%		751,806		5.0	%
Switzerland		718,144		5.0	%		873,703		5.8	%
Spain		309,424		2.2	%		302,323		2.0	%
All other countries		488,147		3.4	%		504,729		3.4	%
Other international assets		945,818		6.6	%		932,661		6.2	%
Total international	$	7,250,109		50.4	%	$	7,549,410		50.3	%
Grand total	$	14,393,696		100.0	%	$	15,001,775		100.0	%

Total Assets by Facility Type (1)


	As of September 30, 2026					As of December 31, 2025
Facility Types	Total Assets		Percentage of Total Assets			Total Assets		Percentage of Total Assets
General acute care hospitals	$	8,197,967		57.0	%	$	8,769,909		58.5	%
Behavioral health facilities		2,383,953		16.5	%		2,445,418		16.3	%
Post acute care facilities		1,640,825		11.4	%		1,671,616		11.1	%
Freestanding ER/urgent care facilities		95,051		0.7	%		109,271		0.7	%
Other assets		2,075,900		14.4	%		2,005,561		13.4	%
Total	$	14,393,696		100.0	%	$	15,001,775		100.0	%

(1)

For geographic and facility type concentration metrics in the tables above, we allocate our investments in unconsolidated operating entities pro rata based on the gross book value of the real estate. Such pro rata allocations are subject to change from period to period.

On an individual property basis, our largest investment in any single property was less than 2% of our total assets as of September 30, 2026.

On a revenue basis, concentration in 2026 compared to the same periods of 2025 is as follows:

Total Revenues by Geographic Location


	For the Three Months Ended September 30,
	2026					2025
Geographic Location	Total Revenues		Percentage of Total Revenues			Total Revenues		Percentage of Total Revenues
Total U.S.	$	131,603		52.6	%	$	120,650		50.8	%
United Kingdom		97,063		38.8	%		95,713		40.3	%
All other countries		21,474		8.6	%		21,159		8.9	%
Grand total	$	250,140		100.0	%	$	237,522		100.0	%

Total Revenues by Facility Type


	For the Three Months Ended September 30,
	2026					2025
Facility Types	Total Revenues		Percentage of Total Revenues			Total Revenues		Percentage of Total Revenues
General acute care hospitals	$	157,580		63.0	%	$	144,760		60.9	%
Behavioral health facilities		54,565		21.8	%		54,726		23.1	%
Post acute care facilities		35,930		14.4	%		36,097		15.2	%
Freestanding ER/urgent care facilities		2,065		0.8	%		1,939		0.8	%
Total	$	250,140		100.0	%	$	237,522		100.0	%

The following shows those tenants that represented 10% or more of our total revenues for the three and nine months ended September 30, 2026 and 2025:


	For the Three Months Ended September 30,
	2026					2025
Operators	Total Revenues		Percentage of Total Revenues			Total Revenues		Percentage of Total Revenues
Circle	$	54,807		21.9	%	$	54,228		22.8	%
Priory		28,279		11.3	%		27,481		11.6	%
Other operators		167,054		66.8	%		155,813		65.6	%
Total	$	250,140		100.0	%	$	237,522		100.0	%


	For the Nine Months Ended September 30,
	2026					2025
Operators	Total Revenues		Percentage of Total Revenues			Total Revenues		Percentage of Total Revenues
Circle	$	164,467		21.6	%	$	158,664		22.6	%
Priory		83,144		10.9	%		78,878		11.2	%
Other operators		513,877		67.5	%		464,138		66.2	%
Total	$	761,488		100.0	%	$	701,680		100.0	%