Dispositions, Real Property Held for Sale and Impairment

9 Months Ended

Sep. 30, 2025

Discontinued Operations and Disposal Groups [Abstract]

Dispositions, Real Property Held for Sale and Impairment

We periodically sell properties for various reasons, including favorable market conditions, the exercise of tenant purchase options or reduction of concentrations (i.e., property type, relationship or geography). We classify a real estate property as held for sale when (i) the disposal has been approved by those within the organization with the appropriate level of authority, (ii) the property is available for sale in its present condition, (iii) an active program to locate a buyer has been initiated, (iv) it is

probable that the property will be disposed within one year, (v) the property is being marketed at a reasonable price relative to its fair value and (vi) it is unlikely that the disposal plan will significantly change or be withdrawn. As part of this process, we also consider whether these disposal transactions constitute a strategic shift that has a major effect on our operations and financial results and represent a discontinued operation.

At September 30, 2025, eight Seniors Housing Operating properties, seven Triple-net properties and 318 Outpatient Medical properties, with an aggregate real estate balance of $5,091,216,000, were classified as held for sale. In addition to the real estate owned, right of use assets, net of $173,162,000, lease liabilities of $184,881,000, secured debt balances of $46,904,000, other assets of $160,750,000 and other liabilities of $115,446,000 are included in the Consolidated Balance Sheets related to the held for sale properties. Expected gross sales proceeds related to these held for sale properties are approximately $7,306,583,000.

The net book value of real property owned is reviewed quarterly on a property by property basis to determine if facts and circumstances suggest that a property may be impaired. If the estimated undiscounted cash flows indicate that the carrying value of the property will not be recoverable, the carrying value of the property is reduced to the estimated fair market value and an impairment charge is recognized. Properties that meet the held for sale criteria are recorded at the lesser of fair value less costs to sell or the carrying value. During the nine months ended September 30, 2025, we recorded impairment charges of $75,359,000 related to nine Seniors Housing Operating properties and six Triple-net properties. During the nine months ended September 30, 2024, we recorded $69,146,000 of impairment charges related to 14 Seniors Housing Operating properties and two Triple-net properties.

Operating results attributable to properties sold or classified as held for sale which do not meet the definition of discontinued operations are not reclassified on our Consolidated Statements of Comprehensive Income. We recognized income (loss) from continuing operations before income taxes and other items from properties sold or classified as held for sale as of September 30, 2025 of $59,923,000 and $114,164,000 for the three and nine months ended September 30, 2025 and $40,060,000 and $108,900,000 for the same respective periods in 2024.

Outpatient Medical Portfolio Disposition

On August 14, 2025, we entered into a definitive agreement to sell a portfolio of 319 consolidated and unconsolidated outpatient medical properties for approximately $7.2 billion. Net proceeds are expected to total approximately $6.0 billion following the reinvestment of a portion of the gross proceeds into a mandatorily redeemable preferred equity investment in the disposed real estate portfolio accompanied by a profits interest. The disposition will occur in tranches expected to close through mid-2026. The properties met the criteria to be classified as held for sale as of September 30, 2025 and we expect to recognize a gain on the sale of the total portfolio. We assessed this transaction and concluded that the disposal of outpatient medical properties does not constitute a strategic shift that has a major effect on our operations and financial results. We disposed of 123 properties with a gross purchase price of approximately $2.0 billion with the closing of the first tranche of the transaction in October 2025.

The following is a summary of our real property disposition activity for the periods presented (in thousands):


	Nine Months Ended
	September 30, 2025		September 30, 2024
Real estate dispositions:(1)
Seniors Housing Operating	$	485,489	$	366,255
Triple-net(2)	250,555		170
Outpatient Medical	5,541		42,761
Total dispositions	741,585		409,186
Gain (loss) on real estate dispositions and acquisitions of controlling interests, net(3)	70,652		171,053
Net other assets/(liabilities) disposed	829		(139)
Non-cash consideration(4)	(290,979)		(434,326)
Cash proceeds from real estate dispositions	$	522,087	$	145,774

(1) Dispositions occurring in the nine months ended September 30, 2025 include the disposition of unconsolidated equity method investments related to our Chartwell joint ventures. See disclosure below for further information. Dispositions occurring in the nine months ended September 30, 2024 include the disposition of unconsolidated equity method investments that owned six Seniors Housing Operating properties and one Outpatient Medical property.

(2) For the nine months ended September 30, 2024, excludes $376,695,000 of net real property derecognized related to 15 properties upon the reclassification of two leases from operating to sales-type (see Note 6 for additional details).

(3) For the nine months ended September 30, 2024, excludes the $179,770,000 gain recognized in conjunction with the joint venture consolidation (see Note 3 for additional details) and the $92,593,000 gain recognized as a result of the reclassification of two leases from operating to sales-type (see Note 6 for additional details).

(4) Non-cash consideration for the nine months ended September 30, 2025 includes the value of the equity method investment attributed to the 16 sold Chartwell properties and the deferred consideration in lieu of cash consideration for the acquired assets classified as held for sale and sold contemporaneously with the related acquisition.

Strategic Dissolution of Chartwell Joint Ventures

During the quarter ended March 31, 2025, we substantially dissolved our existing relationship with Chartwell in Canada in a transaction covering 39 previously unconsolidated Seniors Housing Operating properties. The transaction included the acquisition of Chartwell's interest in 23 properties and the sale of our interest in 16 properties to Chartwell.

We recorded net real estate investments of $474,384,000 related to the 23 acquired and now consolidated properties, which was comprised of $77,385,000 of cash consideration and $396,999,000 of non-cash consideration. Non-cash consideration primarily includes $223,495,000 of assumed mortgage debt secured by the acquired properties, $78,538,000 of carryover investment from our prior equity method ownership interest, $85,435,000 of fair value interests in the 16 properties transferred by us to Chartwell and $9,531,000 of other net liabilities acquired. We also derecognized $41,064,000 of equity method investments related to the 16 properties retained by Chartwell and recorded a gain of $53,354,000 within gain (loss) on real estate dispositions and acquisitions of controlling interests, net within our Consolidated Statements of Comprehensive Income.

In conjunction with the transaction, operations for the 23 now wholly owned properties, along with operations for two other existing wholly-owned properties, transitioned to Cogir Management Corporation ("Cogir").

Strategic Dissolution of Revera Joint Ventures

During the quarter ended June 30, 2023, we entered into definitive agreements to dissolve our existing Revera joint venture relationships across the U.S., U.K. and Canada. The transactions included acquiring the remaining interests in 110 properties from Revera, while simultaneously selling interests in 31 properties to Revera. In the second and third quarters of 2023, we closed the transactions related to the U.K. and U.S. portions of the portfolio, respectively.

In April 2024, we closed the Canadian portfolio portion of the transaction through the acquisition of the remaining ownership interest in 71 properties previously held in consolidated joint venture structures in which we owned 75% of the interests, in exchange for the disposition to Revera of our interests in 14 properties. In addition, we received $60,614,000 of cash relating to the net settlement of loans previously made to Revera to fund its share of the pay-off of third-party secured debt of the joint ventures. Operations for the 71 retained properties transitioned to Cogir (53), Levante Living (12) and Optima Living (6) during 2023.

Total net proceeds related to the 14 properties disposed were $430,898,000, which included non-cash consideration from Revera of $434,326,000, comprised primarily of the net fair value of interests received by us in the amount of $219,940,000, debt which we were relieved of in the amount of $164,640,000 and an allocation of Revera's noncontrolling interests in the disposed properties of $53,174,000. We disposed of net real property owned of $293,257,000 and paid $3,428,000 of cash transaction-related expenses for the sale of the 14 properties, resulting in a gain of $137,641,000 recognized within gain (loss) on real estate dispositions and acquisitions of controlling interests, net within our Consolidated Statements of Comprehensive Income. Consideration transferred to acquire the additional interests in the 71 properties was primarily comprised of the $219,940,000 of fair value of interests transferred by us, a cash payment of $51,986,000 to equalize the value exchanged between the parties and $17,258,000 of cash paid for transaction-related expenses. We derecognized $246,564,000 of Revera's noncontrolling interests in the acquired properties with an adjustment of $42,619,000 recognized in capital in excess of par value.

The non-cash investing activity with respect to the sale of the properties to Revera and non-cash financing activity with respect to the acquisition of Revera's interests have been excluded from our Consolidated Statements of Cash Flows.