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Healthpeak Properties Inc.

10/24/2025 | Press release | Distributed by Public on 10/24/2025 14:17

Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations

All references in this report to "Healthpeak," the "Company," "we," "us," or "our" mean Healthpeak Properties, Inc., together with its consolidated subsidiaries. Unless the context suggests otherwise, references to "Healthpeak Properties, Inc." mean the parent company without its subsidiaries.

Cautionary Language Regarding Forward-Looking Statements

Statements in this Quarterly Report on Form 10-Q that are not historical factual statements are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements include, among other things, statements regarding our and our officers' intent, belief or expectation as identified by the use of words such as "may," "will," "project," "expect," "believe," "intend," "anticipate," "seek," "target," "forecast," "plan," "potential," "estimate," "could," "would," "should" and other comparable and derivative terms or the negatives thereof. Forward-looking statements reflect our current expectations and views about future events and are subject to risks and uncertainties that could cause actual results, including our future financial condition and results of operations, to differ materially from those expressed or implied by any forward-looking statements. You are urged to carefully review the disclosures we make concerning risks and uncertainties that may affect our business and future financial performance.

Forward-looking statements are based on certain assumptions and analysis made in light of our experience and perception of historical trends, current conditions and expected future developments as well as other factors that we believe are appropriate under the circumstances. While forward-looking statements reflect our good faith belief and assumptions we believe to be reasonable based upon current information, we can give no assurance that our expectations or forecasts will be attained. Further, we cannot guarantee the accuracy of any such forward-looking statement contained in this Quarterly Report on Form 10-Q, and you should not place undue reliance on these forward-looking statements, which speak only as of the date of this report.

As more fully set forth under Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, principal risks and uncertainties that may cause our actual results to differ materially from the expectations contained in the forward-looking statements include, among other things:

•macroeconomic trends that may increase construction, labor, and other operating costs;

•changes within the life science industry, and significant regulation, funding requirements, and uncertainty faced by our lab tenants;

•factors adversely affecting our tenants', operators', or borrowers' ability to meet their financial and other contractual obligations to us;

•the insolvency or bankruptcy of one or more of our major tenants, operators, or borrowers;

•our concentration of real estate investments in the healthcare property sector, which makes us more vulnerable to a downturn in that specific sector than if we invested across multiple sectors;

•the illiquidity of real estate investments;

•our ability to identify and secure new or replacement tenants and operators;

•our property development, redevelopment, and tenant improvement risks, which can render a project less profitable or unprofitable and delay or prevent its undertaking or completion;

•the ability of the hospitals on whose campuses our outpatient medical buildings are located and their affiliated healthcare systems to remain competitive or financially viable;

•our ability to develop, maintain, or expand hospital and health system client relationships;

•operational risks associated with our senior housing properties managed by third parties, including our properties operated through structures permitted by the Housing and Economic Recovery Act of 2008, which includes most of the provisions previously proposed in the REIT Investment Diversification and Empowerment Act of 2007 (commonly referred to as "RIDEA");

•economic conditions, natural disasters, weather, and other conditions that negatively affect geographic areas where we have concentrated investments;

•uninsured or underinsured losses, which could result in a significant loss of capital invested in a property, lower than expected future revenues, and unanticipated expenses;

•our use of joint ventures may limit our returns on and our flexibility with jointly owned investments;

•our use of rent escalators or contingent rent provisions in our leases;

•competition for suitable healthcare properties to grow our investment portfolio;

•our ability to exercise rights on collateral securing our real estate-related loans;

•any requirement that we recognize reserves, allowances, credit losses, or impairment charges;

•investment of substantial resources and time in transactions that are not consummated;

•our ability to successfully integrate or operate acquisitions and/or internalize property management;

•the potential impact of unfavorable resolution of litigation or disputes and resulting rising liability and insurance costs;

•environmental compliance costs and liabilities associated with our real estate investments;

•environmental, social, and governance ("corporate impact") and sustainability commitments and requirements, as well as stakeholder expectations;

•epidemics, pandemics, or other infectious diseases, including the coronavirus disease ("Covid"), and health and safety measures intended to reduce their spread;

•human capital risks, including the loss or limited availability of our key personnel;

•our reliance on information technology and any material failure, inadequacy, interruption, or security failure of that technology;

•the use of, or inability to use, artificial intelligence by us, our tenants, our vendors, and our investors;

•volatility, disruption, or uncertainty in the financial markets;

•increased borrowing costs, which could impact our ability to refinance existing debt, sell properties, and conduct investment activities;

•cash available for distribution to stockholders and our ability to make dividend distributions at expected levels;

•the availability of external capital on acceptable terms or at all;

•an increase in our level of indebtedness;

•covenants in our debt instruments, which may limit our operational flexibility, and breaches of these covenants;

•volatility in the market price and trading volume of our common stock;

•adverse changes in our credit ratings;

•the failure of our tenants, operators, and borrowers to comply with federal, state, and local laws and regulations, including resident health and safety requirements, as well as licensure, certification, and inspection requirements;

•required regulatory approvals to transfer our senior housing properties;

•compliance with the Americans with Disabilities Act and fire, safety, and other regulations;

•laws or regulations prohibiting eviction of our tenants;

•the requirements of, or changes to, governmental reimbursement programs such as Medicare or Medicaid, and legislation to address federal government operations and administrative decisions affecting the Centers for Medicare and Medicaid Services;

•our participation in the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") Provider Relief Fund and other Covid-related stimulus and relief programs;

•changes in federal, state, or local laws or regulations that may limit our opportunities to participate in the ownership of, or investment in, healthcare real estate;

•our ability to successfully integrate our operations with Physicians Realty Trust and realize the anticipated synergies of our merger with Physicians Realty Trust (the "Merger") and benefits of property management internalization;

•our ability to maintain our qualification as a real estate investment trust ("REIT");

•our taxable REIT subsidiaries being subject to corporate level tax;

•tax imposed on any net income from "prohibited transactions";

•changes to U.S. federal income tax laws, and potential deferred and contingent tax liabilities from corporate acquisitions;

•calculating non-REIT tax earnings and profits distributions;

•tax protection agreements that may limit our ability to dispose of certain properties and may require us to maintain certain debt levels;

•ownership limits in our charter that restrict ownership in our stock, and provisions of Maryland law and our charter that could prevent a transaction that may otherwise be in the interest of our stockholders;

•conflicts of interest between the interests of our stockholders and the interests of holders of Healthpeak OP, LLC ("Healthpeak OP") common units;

•provisions in the operating agreement of Healthpeak OP and other agreements that may delay or prevent unsolicited acquisitions and other transactions; and

•our status as a holding company of Healthpeak OP.

Important Information Regarding Our Disclosure to Investors

We may use our website (www.healthpeak.com) and our LinkedIn account (https://www.linkedin.com/company/healthpeak) to communicate with our investors and disclose company information. The information disclosed through those channels may be considered to be material, so investors should monitor them in addition to our press releases, U.S. Securities and Exchange Commission ("SEC") filings, and public conference calls and webcasts. The contents of our website or social media channels referenced herein are not incorporated by reference into this Quarterly Report on Form 10-Q.

Overview

The information set forth in this Item 2 is intended to provide readers with an understanding of our financial condition, changes in financial condition and results of operations. We will discuss and provide our analysis in the following order:

•Executive Summary

•Market Trends and Uncertainties

•Company Highlights

•Dividends

•Results of Operations

•Liquidity and Capital Resources

•Non-GAAP Financial Measures Reconciliations

•Critical Accounting Estimates

Executive Summary

Healthpeak Properties, Inc. is a Standard & Poor's ("S&P") 500 company that owns, operates, and develops high-quality real estate focused on healthcare discovery and delivery in the United States ("U.S."). Our company was originally founded in 1985. We are organized as an umbrella partnership REIT ("UPREIT"). We hold substantially all of our assets and conduct our operations through our operating subsidiary, Healthpeak OP, a consolidated subsidiary of which we are the managing member. We are a Maryland corporation and qualify as a self-administered REIT. We are headquartered in Denver, Colorado, with additional corporate offices in California, Tennessee, Wisconsin, and Massachusetts and property management offices in several locations throughout the U.S.

We have a diversified portfolio of high-quality healthcare properties across three core asset classes of outpatient medical, lab, and continuing care retirement community ("CCRC") real estate. Under the outpatient medical and lab segments, we own, operate, and develop outpatient medical buildings, hospitals, and lab buildings. Under the CCRC segment, our properties are operated through RIDEA structures. We have other non-reportable segments that are comprised primarily of: (i) an interest in an unconsolidated joint venture that owns 19 senior housing assets (our "SWF SH JV"), (ii) loans receivable, and (iii) a preferred equity investment. These non-reportable segments have been presented on a combined basis herein.

At September 30, 2025, our portfolio of investments, including properties in certain of our unconsolidated joint ventures, consisted of interests in 703 properties: (i) Outpatient medical - 530 properties; (ii) Lab - 139 properties; (iii) CCRC - 15 properties; and (iv) Other non-reportable - 19 properties. The following table summarizes information for our reportable segments for the three months ended September 30, 2025 (dollars in thousands):


Segment	Adjusted NOI by Reportable Segment(1)
Outpatient medical	$	200,414
Lab	138,058
CCRC	36,548

_______________________________________

(1)Our Adjusted NOI for our reportable segments, which we also refer to as Total Portfolio Adjusted NOI for our reportable segments, includes results of operations from disposed properties through the disposition date. See Note 14 to the Consolidated Financial Statements for a reconciliation of Adjusted NOI by reportable segment to income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures. See our Segment Analysis below for additional information.

For a description of our significant activities during 2025, see "Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations-Company Highlights" in this report.

Business Strategy

Our strategy is to own, operate, and develop high-quality real estate focused on healthcare discovery and delivery. We manage our real estate portfolio for the long-term to maximize risk-adjusted returns and support the growth of our dividends. Our strategy consists of four core elements:

(i)Our real estate: Our portfolio consists of high-quality properties in desirable locations. Our portfolio is focused on outpatient medical and lab buildings, favorable sectors that benefit from the universal desire for improved health. We have built scale and fostered deep industry relationships, two unique factors that provide us with a competitive advantage.

(ii)Our financials: We maintain a strong investment-grade balance sheet with ample liquidity as well as long-term fixed-rate debt financing with staggered maturities to reduce our exposure to interest rate volatility and refinancing risk.

(iii)Our partnerships: We work with leading pharmaceutical, biotechnology, and medical device companies, as well as healthcare delivery systems, specialty physician groups, and other healthcare service providers, to meet their real estate needs. We provide high-quality property management services to encourage tenants to renew, expand, and relocate into our properties, which drives increased occupancy, rental rates, and property values.

(iv)Ourplatform: We have a people-first culture that we believe attracts, develops, and retains top talent. We continually strive to create and maintain an industry-leading platform, with systems and tools that allow us to effectively and efficiently manage our assets and investment activity.

Market Trends and Uncertainties

Our operating results have been and will continue to be impacted by global and national economic and market conditions generally and by the local economic conditions where our properties are located.

Higher interest rates and uncertainty in public and private equity and fixed income markets have led to increased costs and limitations on the availability of capital. In addition, higher interest rates have and could continue to adversely impact our borrowing costs, the fair value of our fixed rate instruments, transaction volume, and real estate values generally, including our real estate. We have also been affected by increased costs relating to tenant improvements and construction, which, together with higher costs of capital and tariff actions (or potential tariff actions), have adversely affected, and in the future may adversely affect, construction starts and the expected yields on our capital projects, including our developments and redevelopments.

We continuously monitor the effects of domestic and global events on our operations and financial position, and on the operations and financial position of our tenants, operators, and borrowers, to enable us to remain responsive and adaptable to the dynamic changes in our operating environment. These events include, but are not limited to, the following, any of which could negatively impact our business: inflation; recession; interest rates; challenges in the financial markets; availability of private capital and funding in the life science industry; and actions by the U.S. political administration and regulatory agencies that affect healthcare policy, life science research and innovation, labor supply, procurement and construction costs, and general economic conditions (such as budget reconciliation actions, tariff actions, changes in healthcare regulation, decreases in government funding and staffing, and immigration reform).

To the extent our tenants and/or operators have experienced, or will experience, increased costs, liquidity constraints, and financing difficulties due to the foregoing macroeconomic and market conditions, they may be unable or unwilling to make payments or perform their obligations when due.

See Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 for additional discussion of the risks posed by macroeconomic conditions, as well as the uncertainties we and our tenants, operators, and borrowers may face as a result.

Company Highlights

Real Estate Transactions

•In February 2025, we acquired: (i) a lab land parcel in Cambridge, Massachusetts for $20 million and (ii) a portfolio of three outpatient medical buildings in New York for $17 million.

•During the three months ended June 30, 2025, we sold one outpatient medical land parcel for $4 million.

•In September 2025, we acquired a condominium interest in eight suites within an outpatient medical building in Atlanta, Georgia for $6 million.

•During the three months ended September 30, 2025, we sold two outpatient medical buildings for $27 million.

Development and Redevelopment Activities

•During the nine months ended September 30, 2025, the following projects were placed in service: (i) a portion of two outpatient medical development projects with total project costs of $32 million, (ii) two lab development buildings held in our unconsolidated Callan Ridge JV of which our share of total project costs was $63 million, (iii) one outpatient medical development project with total project costs of $38 million, (iv) a portion of one lab development project with total project costs of $36 million, (v) two lab redevelopment buildings held in our unconsolidated South San Francisco JVs of which our share of total project costs was $26 million, (vi) one outpatient medical redevelopment project with total project costs of $12 million, and (vii) two lab redevelopment projects with total project costs of $7 million.

Financing Activities

•In February 2025, we repaid $348 million aggregate principal amount of 3.40% senior unsecured notes at maturity.

•In February 2025, we issued $500 million aggregate principal amount of 5.38% senior unsecured notes due 2035.

•In June 2025, we repaid $452 million aggregate principal amount of 4.00% senior unsecured notes at maturity.

•In August 2025, we issued $500 million aggregate principal amount of 4.75% senior unsecured notes due 2033.

•During the nine months ended September 30, 2025, we repurchased 5.09 million shares of our common stock under the 2024 Share Repurchase Program (as defined below) at a weighted average price of $18.50 per share for a total of $94 million.

Other Activities

•In February 2025, we made a preferred equity investment in a joint venture that holds a lab campus under development in San Diego, California (the "HQ Point Preferred Equity Investment"). This investment is entitled to a preferred return, and we have committed to fund up to a total investment of $50 million. As of September 30, 2025, we have funded $45 million of our total commitment.

•During the nine months ended September 30, 2025, we (i) entered into secured loans with an aggregate principal balance of $120 million, $36 million of which was funded upon closing of the loans, and (ii) entered into and funded one $4 million mezzanine loan to one of our unconsolidated joint ventures.

•During the nine months ended September 30, 2025, we entered into two outpatient medical development joint ventures.

•During the nine months ended September 30, 2025, we received full repayment of: (i) two seller financing loans receivable secured by senior housing assets with an aggregate principal balance of $106 million and (ii) the $15 million outstanding balance of one secured loan.

Dividends

The following table summarizes our common stock cash dividends declared in 2025:

Declaration Date

Record Date

Amount Per Share(1)

Dividend Payment Date

February 3

February 14

0.30500

February 26

April 4

April 18

0.10167

April 30

April 4

May 19

0.10167

May 30

April 4

June 16

0.10167

June 27

July 7

July 18

0.10167

July 31

July 7

August 18

0.10167

August 29

July 7

September 19

0.10167

September 30

October 6

October 17

0.10167

October 30

October 6

November 14

0.10167

November 26

October 6

December 19

0.10167

December 30

_______________________________________

(1)Our Board of Directors declares our common stock cash dividends on a quarterly basis. Commencing in April 2025, our Board of Directors transitioned from paying the common stock cash dividend on a quarterly basis to a monthly basis.

Results of Operations

We evaluate our business and allocate resources among our operating segments: (i) outpatient medical, (ii) lab, (iii) CCRC, (iv) an interest in our unconsolidated SWF SH JV, (v) loans receivable, and (vi) a preferred equity investment. The Company's reportable segments, as determined in accordance with ASC 280, Segment Reporting, are as follows: (i) outpatient medical, (ii) lab, and (iii) CCRC. Under the outpatient medical and lab segments, we own, operate, and develop outpatient medical buildings, hospitals, and lab buildings. Our CCRCs are operated through RIDEA structures. The SWF SH JV, loans receivable, and preferred equity investment arenon-reportable segments that have been presented on a combined basis herein. We evaluate performance based upon property adjusted net operating income ("Adjusted NOI" or "Cash NOI") in each segment. The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 2 to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission ("SEC"), as updated by Note 2 to the Consolidated Financial Statements herein.

Non-GAAP Financial Measures

Adjusted NOI

Adjusted NOI is a non-U.S. generally accepted accounting principles ("GAAP") supplemental financial measure used to evaluate the operating performance of real estate. Adjusted NOI represents real estate revenues (inclusive of rental and related revenues, resident fees and services, and government grant income and exclusive of interest income), less property level operating expenses; Adjusted NOI excludes all other financial statement amounts included in net income (loss) as presented in Note 14 to the Consolidated Financial Statements. Adjusted NOI eliminates the effects of straight-line rents, amortization of market lease intangibles, termination fees, actuarial reserves for insurance claims that have been incurred but not reported, and the impact of deferred community fee income and expense. Adjusted NOI is calculated as Adjusted NOI from consolidated properties, plus our share of Adjusted NOI from unconsolidated joint ventures (calculated by applying our actual ownership percentage for the period), less noncontrolling interests' share of Adjusted NOI from consolidated joint ventures (calculated by applying our actual ownership percentage for the period). We utilize our share of Adjusted NOI in assessing our performance as we have various joint ventures that contribute to our performance. Our share of Adjusted NOI should not be considered a substitute for, and should only be considered together with and as a supplement to, our financial information presented in accordance with GAAP.

Adjusted NOI is oftentimes referred to as "Cash NOI." Management believes Adjusted NOI is an important supplemental measure because it provides relevant and useful information by reflecting only income and operating expense items that are incurred at the property level and presents them on an unlevered basis. We use Adjusted NOI to make decisions about resource allocations, to assess and compare property level performance, and to evaluate our Merger-Combined Same-Store ("Merger-Combined SS") performance, as described below. We believe that net income (loss) is the most directly comparable GAAP measure to Adjusted NOI. Adjusted NOI should not be viewed as an alternative measure of operating performance to net income (loss) as defined by GAAP since it does not reflect various excluded items. Further, our definition of Adjusted NOI may not be comparable to the definitions used by other REITs or real estate companies, as they may use different methodologies for calculating Adjusted NOI.

As described in Note 14 to the Consolidated Financial Statements, our chief operating decision maker ("CODM") evaluates the performance of our operating segments based on Adjusted NOI. Our operating segments are aggregated into reportable segments for which we disclose Total Portfolio Adjusted NOI for our reportable segments. For further information, including information reconciling our Adjusted NOI for reportable segments to our income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures, refer to Note 14 to the Consolidated Financial Statements.

Operating expenses generally relate to leased outpatient medical and lab buildings, as well as CCRC facilities. We generally recover all or a portion of our leased outpatient medical and lab property expenses through tenant recoveries, which are recognized within rental and related revenues.

Merger-Combined Same-Store Adjusted NOI

Merger-Combined Same-Store Adjusted NOI includes legacy Physicians Realty Trust properties that met the same-store criteria as if they were owned by the Company for the full analysis period. This information allows our investors, analysts, and us to evaluate the performance of our property portfolio under a consistent population by eliminating changes in the composition of our portfolio of properties, excluding properties within the other non-reportable segments. We include properties from our consolidated portfolio, as well as properties owned by our unconsolidated joint ventures in Adjusted NOI (see Adjusted NOI definition above for further discussion regarding our use of pro-rata share information and its limitations). Merger-Combined Same-Store Adjusted NOI excludes government grant income under the CARES Act, amortization of deferred revenue from tenant-funded improvements, and certain non-property specific operating expenses that are allocated to each operating segment on a consolidated basis.

Properties are included in Merger-Combined Same-Store once they are fully operating for the entirety of the comparative periods presented. A property is removed from Merger-Combined Same-Store when it is classified as held for sale, sold, placed into redevelopment, experiences a casualty event that significantly impacts operations, or a significant tenant relocates from a Merger-Combined Same-Store property to a Merger-Combined non Same-Store property and that change results in a corresponding increase in revenue. We do not report Merger-Combined Same-Store metrics for our other non-reportable segments.

Management believes that continued reporting of the same-store portfolio for only pre-merger Healthpeak Properties, Inc. offers minimal value to investors who are seeking to understand the operating performance and growth potential of the Combined Company. The Company was provided access to the underlying financial statements of legacy Physicians Realty Trust and other detailed information about each property, such as the acquisition date. Based on this available information, the Company was able to consistently apply its same-store definition across the combined portfolio. As a result of the Merger, approximately 97% of the combined portfolio is represented in the Merger-Combined Same-Store presentation for the outpatient medical segment for each of the three and nine months ended September 30, 2025.

For a reconciliation of Merger-Combined Same-Store to total portfolio Adjusted NOI and other relevant disclosures by segment, refer to our Segment Analysis below.

Nareit FFO. Funds from Operations ("FFO"), as defined by the National Association of Real Estate Investment Trusts ("Nareit"), is net income (loss) applicable to common shares (computed in accordance with GAAP), excluding gains or losses from sales of depreciable property, including any current and deferred taxes directly associated with sales of depreciable property, impairments of, or related to, depreciable real estate or land held for development, plus real estate-related depreciation and amortization, and adjustments to compute our share of Nareit FFO from joint ventures. Adjustments for joint ventures are calculated to reflect our pro rata share of both our consolidated and unconsolidated joint ventures. We reflect our share of Nareit FFO for unconsolidated joint ventures by applying our actual ownership percentage for the period to the applicable reconciling items on an entity by entity basis. For consolidated joint ventures in which we do not own 100%, we reflect our share of the equity by adjusting our Nareit FFO to remove the third-party ownership share of the applicable reconciling items based on actual ownership percentage for the applicable periods. Our pro rata share information is prepared on a basis consistent with the comparable consolidated amounts, is intended to reflect our proportionate economic interest in the operating results of properties in our portfolio and is calculated by applying our actual ownership percentage for the period. We do not control the unconsolidated joint ventures, and the pro rata presentations of reconciling items included in Nareit FFO do not represent our legal claim to such items. The joint venture members or partners are entitled to profit or loss allocations and distributions of cash flows according to the joint venture agreements, which provide for such allocations generally according to their invested capital.

The presentation of pro rata information has limitations, which include, but are not limited to, the following: (i) the amounts shown on the individual line items were derived by applying our overall economic ownership interest percentage determined when applying the equity method of accounting and do not necessarily represent our legal claim to the assets and liabilities, or the revenues and expenses and (ii) other companies in our industry may calculate their pro rata interest differently, limiting the usefulness as a comparative measure. Because of these limitations, the pro rata financial information should not be considered independently or as a substitute for our financial statements as reported under GAAP. We compensate for these limitations by relying primarily on our GAAP financial statements, using the pro rata financial information as a supplement.

We believe Nareit FFO applicable to common shares and diluted Nareit FFO applicable to common shares are important supplemental non-GAAP measures of operating performance for a REIT. Because the historical cost accounting convention used for real estate assets utilizes straight-line depreciation (except on land), such accounting presentation implies that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen and fallen with market conditions, presentations of operating results for a REIT that use historical cost accounting for depreciation could be less informative. The term Nareit FFO was designed by the REIT industry to address this issue.

Nareit FFO does not represent cash generated from operating activities in accordance with GAAP, is not necessarily indicative of cash available to fund cash needs and should not be considered an alternative to net income (loss). We compute Nareit FFO in accordance with the current Nareit definition; however, other REITs may report Nareit FFO differently or have a different interpretation of the current Nareit definition from ours. For a reconciliation of net income (loss) to Nareit FFO and other relevant disclosures, refer to "Non-GAAP Financial Measures Reconciliations" below.

FFO as Adjusted.In addition, we present Nareit FFO on an adjusted basis before the impact of non-comparable items including, but not limited to, transaction and merger-related items, other impairments (recoveries) and other losses (gains), restructuring and severance-related charges, prepayment costs (benefits) associated with early retirement or payment of debt, litigation costs (recoveries), casualty-related charges (recoveries), deferred tax asset valuation allowances, and changes in tax legislation ("FFO as Adjusted"). These adjustments are net of tax, when applicable, and are reflective of our share of our joint ventures. Adjustments for joint ventures are calculated to reflect our pro rata share of both our consolidated and unconsolidated

joint ventures. We reflect our share of FFO as Adjusted for unconsolidated joint ventures by applying our actual ownership percentage for the period to the applicable reconciling items on an entity by entity basis. We reflect our share for consolidated joint ventures in which we do not own 100% of the equity by adjusting our FFO as Adjusted to remove the third-party ownership share of the applicable reconciling items based on actual ownership percentage for the applicable periods. See "Nareit FFO" above for further disclosures regarding our use of pro rata share information and its limitations. Prepayment costs (benefits) associated with early retirement of debt include the write-off of unamortized deferred financing fees, or additional costs, expenses, discounts, make-whole payments, penalties or premiums incurred as a result of early retirement or payment of debt. Other impairments (recoveries) and other losses (gains) include interest income associated with early and partial repayments of loans receivable and other losses or gains associated with non-depreciable assets including goodwill, undeveloped land parcels, and loans receivable. Management believes that FFO as Adjusted provides a meaningful supplemental measurement of our FFO run-rate and is frequently used by analysts, investors, and other interested parties in the evaluation of our performance as a REIT. At the same time that Nareit created and defined its FFO measure for the REIT industry, it also recognized that "management of each of its member companies has the responsibility and authority to publish financial information that it regards as useful to the financial community." We believe stockholders, potential investors, and financial analysts who review our operating performance are best served by an FFO run-rate earnings measure that includes certain other adjustments to net income (loss), in addition to adjustments made to arrive at the Nareit defined measure of FFO. FFO as Adjusted is used by management in analyzing our business and the performance of our properties and we believe it is important that stockholders, potential investors, and financial analysts understand this measure used by management. We use FFO as Adjusted to: (i) evaluate our performance in comparison with expected results and results of previous periods, relative to resource allocation decisions, (ii) evaluate the performance of our management, (iii) budget and forecast future results to assist in the allocation of resources, (iv) assess our performance as compared with similar real estate companies and the industry in general, and (v) evaluate how a specific potential investment will impact our future results. Other REITs or real estate companies may use different methodologies for calculating an adjusted FFO measure, and accordingly, our FFO as Adjusted may not be comparable to those reported by other REITs. For a reconciliation of net income (loss) to FFO as Adjusted and other relevant disclosure, refer to "Non-GAAP Financial Measures Reconciliations" below.

Adjusted FFO ("AFFO"). AFFO is defined as FFO as Adjusted after excluding the impact of the following: (i) stock-based compensation amortization expense, (ii) amortization of deferred financing costs and debt discounts (premiums), (iii) straight-line rents, (iv) deferred income taxes, (v) amortization of above (below) market lease intangibles, net, (vi) non-refundable entrance fees collected in excess of (less than) the related amortization, and (vii) other AFFO adjustments, which include: (a) lease incentive amortization (reduction of straight-line rents), (b) actuarial reserves for insurance claims that have been incurred but not reported, and (c) amortization of deferred revenues, excluding amounts amortized into rental income that are associated with tenant funded improvements owned/recognized by us and up-front cash payments made by tenants to reduce their contractual rents. Also, AFFO is computed after deducting recurring capital expenditures, including second generation leasing costs and second generation tenant and capital improvements ("AFFO capital expenditures"). All adjustments are reflective of our pro rata share of both our consolidated and unconsolidated joint ventures (reported in "other AFFO adjustments"). We reflect our share of AFFO for unconsolidated joint ventures by applying our actual ownership percentage for the period to the applicable reconciling items on an entity by entity basis. We reflect our share for consolidated joint ventures in which we do not own 100% of the equity by adjusting our AFFO to remove the third-party ownership share of the applicable reconciling items based on actual ownership percentage for the applicable periods. See "Nareit FFO" above for further disclosures regarding our use of pro rata share information and its limitations. We believe AFFO is an alternative run-rate performance measure that improves the understanding of our operating results among investors and makes comparisons with: (i) expected results, (ii) results of previous periods, and (iii) results among REITs more meaningful. AFFO does not represent cash generated from operating activities determined in accordance with GAAP and is not indicative of cash available to fund cash needs as it excludes the following items which generally flow through our cash flows from operating activities: (i) adjustments for changes in working capital or the actual timing of the payment of income or expense items that are accrued in the period, (ii) transaction-related costs, (iii) litigation settlement expenses, and (iv) restructuring and severance-related charges. Furthermore, AFFO is adjusted for recurring capital expenditures, which are generally not considered when determining cash flows from operations or liquidity. Other REITs or real estate companies may use different methodologies for calculating AFFO, and accordingly, our AFFO may not be comparable to those reported by other REITs. Management believes AFFO provides a meaningful supplemental measure of our performance and is frequently used by analysts, investors, and other interested parties in the evaluation of our performance as a REIT, and by presenting AFFO, we are assisting these parties in their evaluation. AFFO is a non-GAAP supplemental financial measure and should not be considered as an alternative to net income (loss) determined in accordance with GAAP and should only be considered together with and as a supplement to our financial information prepared in accordance with GAAP. For a reconciliation of net income (loss) to AFFO and other relevant disclosures, refer to "Non-GAAP Financial Measures Reconciliations" below.

Comparison of the Three and Nine Months Ended September 30, 2025 to the Three and Nine Months Ended September 30, 2024

Overview

The following table summarizes results for the three months ended September 30, 2025 and 2024(1)(in thousands):


	Three Months Ended September 30,
	2025		2024		Change
Net income (loss) applicable to common shares	$	(117,256)	$	85,675	$	(202,931)
Nareit FFO	318,155		311,247		6,908
FFO as Adjusted	318,750		316,205		2,545
AFFO	291,974		295,979		(4,005)

_______________________________________

(1)For the reconciliation of non-GAAP financial measures, see "Non-GAAP Financial Measures Reconciliations" below.

Net income (loss) applicable to common shares decreased primarily as a result of the following:

•other-than-temporary impairment charges on two lab unconsolidated joint ventures in 2025;

•a decrease in gain on sales of real estate related to fewer real estate dispositions in 2025;

•a decrease in Adjusted NOI generated from our outpatient medical and lab segments related to: (i) dispositions of real estate in 2024 and 2025 and (ii) assets placed into development and redevelopment in 2024 and 2025, partially offset by: (i) development and redevelopment projects placed in service during 2024 and 2025 and (ii) new leasing activity during 2024 and 2025 (including the impact to straight-line rents); and

•an increase in interest expense related to: (i) the issuance of $500 million aggregate principal amount of 5.38% senior unsecured notes due 2035, which closed in February 2025, (ii) the issuance of $500 million aggregate principal amount of 4.75% senior unsecured notes due 2033, which closed in August 2025, and (iii) higher borrowings under the commercial paper program.

The decrease in net income (loss) applicable to common shares was partially offset by:

•a decrease in depreciation related to dispositions of real estate in 2024 and 2025;

•a decrease in transaction and merger-related costs incurred in connection with the Merger;

•a decrease in general and administrative expenses due to: (i) lower compensation expense and (ii) merger-related synergies;

•an increase in income tax benefit related to the other-than-temporary impairment charge on the Needham Land Parcel JV;

•an increase in Adjusted NOI generated from our CCRC segment related to: (i) increased rates for resident fees and (ii) higher occupancy; and

•an increase in interest income related to: (i) secured loans funded in 2024 and 2025 and (ii) seller financing provided in connection with the disposition of two outpatient medical buildings in November 2024, partially offset by principal repayments on loans receivable in 2024 and 2025.

Nareit FFO increased primarily as a result of the aforementioned events impacting net income (loss) applicable to common shares, except for the following, which are excluded from Nareit FFO:

•other-than-temporary impairment charges;

•gain on sales of real estate; and

•depreciation and amortization expense.

FFO as Adjusted increased primarily as a result of the aforementioned events impacting Nareit FFO, except for transaction and merger-related items, which are excluded from FFO as Adjusted.

AFFO decreased primarily as a result of the aforementioned events impacting FFO as Adjusted, except for the impact of straight-line rents, which are excluded from AFFO, and higher AFFO capital expenditures during the period. The decrease to AFFO was partially offset by higher cash collections of non-refundable entrance fees in excess of amortization at our CCRCs.

The following table summarizes results for the nine months ended September 30, 2025 and 2024(1)(in thousands):


	Nine Months Ended September 30,
	2025		2024		Change
Net income (loss) applicable to common shares	$	(43,335)	$	237,985	$	(281,320)
Nareit FFO	940,418		785,876		154,542
FFO as Adjusted	965,087		907,128		57,959
AFFO	903,977		833,281		70,696

_______________________________________

(1)For the reconciliation of non-GAAP financial measures, see "Non-GAAP Financial Measures Reconciliations" below.

Net income (loss) applicable to common shares decreased primarily as a result of the following:

•other-than-temporary impairment charges on two lab unconsolidated joint ventures in 2025;

•a decrease in gain on sales of real estate related to fewer real estate dispositions in 2025;

•a decrease in gain upon change of control related to the sale of a 65% interest in two lab buildings in San Diego, California to a third-party in January 2024;

•an increase in interest expense related to: (i) debt assumed as part of the Merger, including $1.25 billion aggregate principal amount of senior unsecured notes, $400 million aggregate principal amount of the 2028 Term Loan, and $128 million aggregate principal amount of mortgage debt, (ii) borrowings under the 2029 Term Loan, which closed in March 2024, (iii) the issuance of $500 million aggregate principal amount of 5.38% senior unsecured notes due 2035, which closed in February 2025, (iv) the issuance of $500 million aggregate principal amount of 4.75% senior unsecured notes due 2033, which closed in August 2025, and (v) higher borrowings under the commercial paper program;

•an increase in depreciation related to: (i) assets acquired as part of the Merger and (ii) development and redevelopment projects placed in service during 2024 and 2025; and

•casualty-related losses recognized in 2025.

The decrease in net income (loss) applicable to common shares was partially offset by:

•a decrease in transaction and merger-related costs incurred in connection with the Merger;

•an increase in Adjusted NOI generated from our outpatient medical and lab segments related to: (i) assets acquired as part of the Merger, (ii) development and redevelopment projects placed in service during 2024 and 2025, and (iii) new leasing activity during 2024 and 2025 (including the impact to straight-line rents), partially offset by: (i) dispositions of real estate in 2024 and (ii) assets placed into development and redevelopment in 2024 and 2025;

•an increase in interest income related to: (i) seller financing provided in connection with the disposition of 61 outpatient medical buildings in 2024, (ii) loans receivable acquired as part of the Merger, and (iii) other secured loans funded in 2024 and 2025;

•a decrease in income tax expense related to: (i) income tax expense incurred in connection with the sale of a 65% interest in two lab buildings in San Diego, California to a third-party in January 2024, (ii) the tax benefit from casualty-related losses recognized in 2025, and (iii) the tax benefit related to the other-than-temporary impairment charge on the Needham Land Parcel JV;

•a decrease in loan loss reserves under the current expected credit losses model related to: (i) reserves recognized in 2024 on loans receivable acquired as part of the Merger, (ii) changes in operating performance and fair values of the underlying collateral of the Company's loans receivable, and (iii) recoveries related to loans repaid during the nine months ended September 30, 2025;

•an increase in Adjusted NOI generated from our CCRC segment related to: (i) increased rates for resident fees and (ii) higher occupancy;

•a decrease in interest expense related to: (i) the repayment of $348 million aggregate principal amount of 3.40% senior unsecured notes in February 2025 and (ii) the repayment of $452 million aggregate principal amount of 4.00% senior unsecured notes in June 2025;

•a decrease in general and administrative expenses due to: (i) lower compensation expense and (ii) merger-related synergies.

Nareit FFO increased primarily as a result of the aforementioned events impacting net income (loss) applicable to common shares, except for the following, which are excluded from Nareit FFO:

•other-than-temporary impairment charges;

•gain on sales of real estate;

•taxes associated with real estate dispositions;

•gain upon change of control; and

•depreciation and amortization expense.

FFO as Adjusted increased primarily as a result of the aforementioned events impacting Nareit FFO, except for the following, which are excluded from FFO as Adjusted:

•transaction and merger-related items;

•loan loss reserves (recoveries); and

•casualty-related charges.

AFFO increased primarily as a result of the aforementioned events impacting FFO as Adjusted, except for the impact of: (i) amortization of below market lease intangibles, (ii) amortization of deferred financing costs and debt discounts (premiums) on amounts recognized in connection with the Merger, (iii) deferred income taxes, and (iv) straight-line rents, which are excluded from AFFO. AFFO further increased as a result of higher cash collections of non-refundable entrance fees in excess of amortization at our CCRCs.

Segment Analysis

The following tables provide selected operating information for our Merger-Combined Same-Store and total property portfolio for each of our reportable segments. For the three months ended September 30, 2025, our Merger-Combined Same-Store consists of 631 properties representing properties fully operating on or prior to July 1, 2024 and that remained in operation through September 30, 2025. For the nine months ended September 30, 2025, our Merger-Combined Same-Store consists of 628 properties representing properties fully operating on or prior to January 1, 2024 and that remained in operation through September 30, 2025. Legacy Physicians Realty Trust properties that met the definition of Merger-Combined Same-Store are included in both periods presented as if they were owned by the Company for the full analysis period. See "Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations-Non-GAAP Financial Measures" for additional information. Our total property portfolio consisted of 703 and 700 properties at September 30, 2025 and 2024, respectively.

Outpatient Medical

The following table summarizes results at and for the three months ended September 30, 2025 and 2024 (dollars and square feet in thousands, except per square foot data):


	Merger-Combined SS						Total Portfolio(1)
	Three Months Ended September 30,						Three Months Ended September 30,
	2025		2024		Change		2025		2024		Change
Rental and related revenues	$	315,473	$	304,315	$	11,158	$	326,561	$	317,659	$	8,902
Healthpeak's share of unconsolidated joint venture total revenues	6,970		6,883		87		7,327		7,065		262
Noncontrolling interests' share of consolidated joint venture total revenues	(10,129)		(9,553)		(576)		(10,334)		(9,734)		(600)
Operating expenses	(107,921)		(99,414)		(8,507)		(113,660)		(106,484)		(7,176)
Healthpeak's share of unconsolidated joint venture operating expenses	(2,750)		(2,761)		11		(2,887)		(2,832)		(55)
Noncontrolling interests' share of consolidated joint venture operating expenses	3,765		2,851		914		3,765		2,851		914
Adjustments to NOI(2)	(10,002)		(10,738)		736		(10,358)		(11,020)		662
Adjusted NOI	$	195,406	$	191,583	$	3,823	200,414		197,505		2,909
Less: Merger-Combined Non-SS Adjusted NOI							(5,008)		(5,922)		914
Merger-Combined SS Adjusted NOI							$	195,406	$	191,583	$	3,823
Adjusted NOI % change					2.0%
Property count(3)	514		514				530		527
End of period occupancy(4)	91.4%		92.5%				91.3%		92.2%
Average occupancy(4)	91.5%		92.5%				91.2%		92.2%
Average occupied square feet	33,186		33,667				33,878		34,956
Average annual total revenues per occupied square foot(5)	$	38	$	36			$	39	$	36
Average annual base rent per occupied square foot(6)	$	28	$	25			$	29	$	28

___________________________________

(1)Total Portfolio includes results of operations from disposed properties through the disposition date.

(2)Represents adjustments we make to calculate Adjusted NOI in accordance with our definition of Adjusted NOI, which is used by our CODM to evaluate performance of our reportable segments. See Note 14 to the Consolidated Financial Statements for further information, including information reconciling our Adjusted NOI for reportable segments to income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures. Refer also to "Non-GAAP Financial Measures" above for the definition of Adjusted NOI.

(3)From our third quarter 2024 presentation of Merger-Combined Same-Store, we added: (i) three stabilized redevelopments placed in service, (ii) three stabilized acquisitions, (iii) and one stabilized development placed in service, and we removed: (i) five assets that were sold and (ii) one building that was placed into redevelopment.

(4)Total Portfolio occupancy excludes any of the following: (i) developments, (ii) significant redevelopments, (iii) newly completed properties under lease-up, and (iv) properties held for sale.

(5)Average annual total revenues does not include non-cash revenue adjustments (i.e., straight-line rents, amortization of market lease intangibles, and deferred revenues).

(6)Base rent does not include tenant recoveries, additional rents in excess of floors, and non-cash revenue adjustments (i.e., straight-line rents, amortization of market lease intangibles, and deferred revenues).

Merger-Combined Same-Store Adjusted NOI increased primarily as a result of the following:

•mark-to-market lease renewals;

•annual rent escalations; and

•increased percentage-based rents; partially offset by

•higher operating expenses, net of savings from our internalization of property management.

Total Portfolio Adjusted NOI increased as a result of the aforementioned impacts to Merger-Combined Same-Store and the following Merger-Combined Non-Same-Store impacts:

•Adjusted NOI from the outpatient medical buildings acquired as part of the Merger in 2024;

•increased Adjusted NOI from outpatient medical buildings acquired in 2025; and

•increased occupancy in former redevelopment and development properties that have been placed into service; partially offset by

•decreased Adjusted NOI from our 2024 and 2025 dispositions.

The following table summarizes results at and for the nine months ended September 30, 2025 and 2024 (dollars and square feet in thousands, except per square foot data):


	Merger-Combined SS(1)						Total Portfolio(2)
	Nine Months Ended September 30,						Nine Months Ended September 30,
	2025		2024		Change		2025		2024		Change
Rental and related revenues	$	932,264	$	894,342	$	37,922	$	967,591	$	888,446	$	79,145
Healthpeak's share of unconsolidated joint venture total revenues	21,073		20,221		852		21,769		16,707		5,062
Noncontrolling interests' share of consolidated joint venture total revenues	(28,121)		(27,103)		(1,018)		(30,327)		(27,952)		(2,375)
Operating expenses	(306,044)		(294,525)		(11,519)		(324,216)		(299,455)		(24,761)
Healthpeak's share of unconsolidated joint venture operating expenses	(8,296)		(7,627)		(669)		(8,576)		(6,380)		(2,196)
Noncontrolling interests' share of consolidated joint venture operating expenses	8,662		7,616		1,046		9,344		7,889		1,455
Adjustments to NOI(3)	(32,355)		(26,154)		(6,201)		(33,253)		(27,573)		(5,680)
Adjusted NOI	$	587,183	$	566,770	$	20,413	602,332		551,682		50,650
Pre-Merger legacy Physicians Realty Trust Adjusted NOI(4)							-		61,398		(61,398)
Less: Merger-Combined Non-SS Adjusted NOI							(15,149)		(46,310)		31,161
Merger-Combined SS Adjusted NOI							$	587,183	$	566,770	$	20,413
Adjusted NOI % change					3.6%
Property count(5)	513		513				530		527
End of period occupancy(6)	91.4%		92.4%				91.3%		92.2%
Average occupancy(6)	92.0%		92.6%				91.6%		92.1%
Average occupied square feet	33,324		33,593				33,989		36,209
Average annual total revenues per occupied square foot(7)	$	37	$	36			$	38	$	36
Average annual base rent per occupied square foot(8)	$	28	$	28			$	29	$	29

_______________________________________

(1)Merger-Combined Same-Store includes legacy Physicians Realty Trust properties that met the definition of Merger-Combined Same-Store as if they were owned by the Company for the full analysis period. Refer to "Non-GAAP Financial Measures" above for the definition of Merger-Combined Same-Store.

(2)Total Portfolio includes results of operations from disposed properties through the disposition date. 2024 Total Portfolio includes results of operations for legacy Healthpeak prior to the Closing Date and results of operations for the Combined Company after the Closing Date.

(3)Represents adjustments we make to calculate Adjusted NOI in accordance with our definition of Adjusted NOI, which is used by our CODM to evaluate performance of our reportable segments. See Note 14 to the Consolidated Financial Statements for further information, including information reconciling our Adjusted NOI for reportable segments to income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures. Refer also to "Non-GAAP Financial Measures" above for the definition of Adjusted NOI.

(4)Represents Adjusted NOI for legacy Physicians Realty Trust properties prior to the Closing Date.

(5)From our third quarter 2024 presentation of Same-Store, we added: (i) five stabilized acquisitions and (ii) four stabilized redevelopments placed in service, and we removed: (i) five assets that were sold and (ii) one building that was placed into redevelopment.

(6)Total Portfolio occupancy excludes any of the following: (i) developments, (ii) significant redevelopments, (iii) newly completed properties under lease-up, and (iv) properties held for sale.

(7)Average annual total revenues does not include non-cash revenue adjustments (i.e., straight-line rents, amortization of market lease intangibles, and deferred revenues).

(8)Base rent does not include tenant recoveries, additional rents in excess of floors, and non-cash revenue adjustments (i.e., straight-line rents, amortization of market lease intangibles, and deferred revenues).

Merger-Combined Same-Store Adjusted NOI increased primarily as a result of the following:

•mark-to-market lease renewals;

•annual rent escalations; and

•increased percentage-based rents; partially offset by

•higher operating expenses, net of savings from our internalization of property management.

Total Portfolio Adjusted NOI increased primarily as a result of the aforementioned impacts to Merger-Combined Same-Store and the following Merger-Combined Non-Same-Store impacts:

•Adjusted NOI from the outpatient medical buildings acquired as part of the Merger in 2024;

•increased Adjusted NOI from outpatient medical buildings acquired in 2025;

•increased occupancy in former redevelopment and development properties that have been placed into service; partially offset by

•decreased Adjusted NOI from our 2024 and 2025 dispositions.

Lab

The following table summarizes results at and for the three months ended September 30, 2025 and 2024 (dollars and square feet in thousands, except per square foot data):


	Merger-Combined SS						Total Portfolio(1)
	Three Months Ended September 30,						Three Months Ended September 30,
	2025		2024		Change		2025		2024		Change
Rental and related revenues	$	178,162	$	181,087	$	(2,925)	$	213,325	$	225,592	$	(12,267)
Healthpeak's share of unconsolidated joint venture total revenues	2,282		2,083		199		6,834		5,242		1,592
Operating expenses	(51,086)		(51,829)		743		(64,352)		(64,075)		(277)
Healthpeak's share of unconsolidated joint venture operating expenses	(762)		(754)		(8)		(2,229)		(1,811)		(418)
Adjustments to NOI(2)	(12,499)		(10,646)		(1,853)		(15,520)		(16,900)		1,380
Adjusted NOI	$	116,097	$	119,941	$	(3,844)	138,058		148,048		(9,990)
Less: Merger-Combined Non-SS Adjusted NOI							(21,961)		(28,107)		6,146
Merger-Combined SS Adjusted NOI							$	116,097	$	119,941	$	(3,844)
Adjusted NOI % change					(3.2)%
Property count(3)	102		102				139		139
End of period occupancy(4)	93.2%		97.7%				93.4%		95.7%
Average occupancy(4)	93.7%		97.7%				93.8%		95.6%
Average occupied square feet	7,549		7,841				9,017		9,561
Average annual total revenues per occupied square foot(5)	$	90	$	89			$	92	$	90
Average annual base rent per occupied square foot(6)	$	64	$	64			$	69	$	67

_______________________________________

(1)Total Portfolio includes results of operations from disposed properties through the disposition date.

(3)From our third quarter 2024 presentation of Merger-Combined Same-Store, we added: (i) four stabilized redevelopments placed in service and (ii) one stabilized development placed in service, and we removed: (i) eight buildings that were placed into redevelopment and (ii) six assets that were classified as held for sale.

(4)Refer to "Non-GAAP Financial Measures" above for the definition of Merger-Combined Same-Store. Total Portfolio occupancy excludes any of the following: (i) developments, (ii) significant redevelopments, (iii) newly completed properties under lease-up, and (iv) properties held for sale.

(5)Average annual total revenues does not include non-cash revenue adjustments (i.e., straight-line rents, amortization of market lease intangibles, and deferred revenues).

Merger-Combined Same-Store Adjusted NOI decreased primarily as a result of the following:

•lower occupancy; partially offset by

•annual rent escalations; and

•lower operating expenses related to savings from our internalization of property management.

Total Portfolio Adjusted NOI decreased primarily as a result of the aforementioned impacts to Merger-Combined Same-Store and the following Merger-Combined Non-Same-Store impacts:

•decreased Adjusted NOI from our 2024 dispositions;

•decreased Adjusted NOI from buildings undergoing development and redevelopment in 2024 and 2025; and

•higher operating expenses.

The following table summarizes results at and for the nine months ended September 30, 2025 and 2024 (dollars and square feet in thousands, except per square foot data):


	Merger-Combined SS						Total Portfolio(1)
	Nine Months Ended September 30,						Nine Months Ended September 30,
	2025		2024		Change		2025		2024		Change
Rental and related revenues	$	532,732	$	519,783	$	12,949	$	640,123	$	663,619	$	(23,496)
Healthpeak's share of unconsolidated joint venture total revenues	5,761		5,880		(119)		16,992		14,404		2,588
Noncontrolling interests' share of consolidated joint venture total revenues	-		-		-		-		(196)		196
Operating expenses	(143,544)		(141,130)		(2,414)		(181,412)		(177,571)		(3,841)
Healthpeak's share of unconsolidated joint venture operating expenses	(1,845)		(1,933)		88		(5,793)		(4,663)		(1,130)
Noncontrolling interests' share of consolidated joint venture operating expenses	-		-		-		-		52		(52)
Adjustments to NOI(2)	(34,984)		(31,531)		(3,453)		(42,844)		(51,624)		8,780
Adjusted NOI	$	358,120	$	351,069	$	7,051	427,066		444,021		(16,955)
Less: Merger-Combined Non-SS Adjusted NOI							(68,946)		(92,952)		24,006
Merger-Combined SS Adjusted NOI							$	358,120	$	351,069	$	7,051
Adjusted NOI % change					2.0%
Property count(3)	100		100				139		139
End of period occupancy(4)	93.1%		97.7%				93.4%		95.7%
Average occupancy(4)	95.7%		97.8%				95.9%		95.9%
Average occupied square feet	7,583		7,695				9,262		9,735
Average annual total revenues per occupied square foot(5)	$	89	$	86			$	90	$	87
Average annual base rent per occupied square foot(6)	$	65	$	63			$	68	$	66

_______________________________________

(1)Total Portfolio includes results of operations from disposed properties through the disposition date.

(3)From our third quarter 2024 presentation of Same-Store, we added: (i) three stabilized redevelopments placed in service and (ii) one stabilized development placed in service, and we removed: (i) eight buildings that were placed into redevelopment and (ii) six assets that were classified as held for sale.

(5)Average annual total revenues does not include non-cash revenue adjustments (i.e., straight-line rents, amortization of market lease intangibles, and deferred revenues).

Merger-Combined Same-Store Adjusted NOI increased primarily as a result of the following:

•annual rent escalations; partially offset by

•higher operating expenses, net of savings from our internalization of property management; and

•lower occupancy.

Total Portfolio Adjusted NOI decreased primarily as a result of the following:

•decreased Adjusted NOI from our 2024 dispositions; and

•decreased Adjusted NOI from buildings undergoing development and redevelopment in 2024 and 2025; partially offset by

•the aforementioned increases to Merger-Combined Same-Store.

Continuing Care Retirement Community

The following table summarizes results at and for the three months ended September 30, 2025 and 2024 (dollars in thousands, except per unit data):


	Merger-Combined SS						Total Portfolio
	Three Months Ended September 30,						Three Months Ended September 30,
	2025		2024		Change		2025		2024		Change
Resident fees and services	$	150,458	$	142,845	$	7,613	$	150,458	$	142,845	$	7,613
Operating expenses	(113,518)		(109,163)		(4,355)		(113,910)		(109,720)		(4,190)
Adjustments to NOI(1)	-		95		(95)		-		95		(95)
Adjusted NOI	$	36,940	$	33,777	$	3,163	36,548		33,220		3,328
Plus (less): Merger-Combined Non-SS adjustments							392		557		(165)
Merger-Combined SS Adjusted NOI							$	36,940	$	33,777	$	3,163
Adjusted NOI % change					9.4 %
Property count(2)	15		15				15		15
Average occupancy(3)	86.7%		85.2%				86.7%		85.2%
Average occupied units(4)	6,121		6,001				6,121		6,013
Average annual rent per occupied unit	$	98,322	$	95,215			$	98,322	$	95,025

_______________________________________

(1)Represents adjustments we make to calculate Adjusted NOI in accordance with our definition of Adjusted NOI, which is used by our CODM to evaluate performance of our reportable segments. See Note 14 to the Consolidated Financial Statements for further information, including information reconciling our Adjusted NOI for reportable segments to income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures. Refer also to "Non-GAAP Financial Measures" above for the definition of Adjusted NOI.

(2)From our third quarter 2024 presentation of Merger-Combined Same-Store, no properties were added or removed.

(3)Refer to "Non-GAAP Financial Measures" above for the definition of Merger-Combined Same-Store. Total Portfolio occupancy excludes any of the following: (i) developments, (ii) significant redevelopments, (iii) newly completed properties under lease-up, and (iv) properties held for sale.

(4)Represents average occupied units as reported by the operators for the three-month period.

Merger-Combined Same-Store Adjusted NOI and Total Portfolio Adjusted NOI increased primarily as a result of the following:

•increased rates for resident fees; and

•higher occupancy; partially offset by

•higher costs of labor, repairs and maintenance, management fees, and other operating expenses.

The following table summarizes results at and for the nine months ended September 30, 2025 and 2024 (dollars in thousands, except per unit data):


	Merger-Combined SS						Total Portfolio
	Nine Months Ended September 30,						Nine Months Ended September 30,
	2025		2024		Change		2025		2024		Change
Resident fees and services	$	448,240	$	422,512	$	25,728	$	448,240	$	422,512	$	25,728
Operating expenses	(334,436)		(319,349)		(15,087)		(335,618)		(320,809)		(14,809)
Adjustments to NOI(1)	(844)		(1,642)		798		(844)		(1,645)		801
Adjusted NOI	$	112,960	$	101,521	$	11,439	111,778		100,058		11,720
Plus (less): Merger-Combined Non-SS adjustments							1,182		1,463		(281)
Merger-Combined SS Adjusted NOI							$	112,960	$	101,521	$	11,439
Adjusted NOI % change					11.3 %
Property count(2)	15		15				15		15
Average occupancy(3)	86.3%		85.2%				86.3%		85.3%
Average occupied units(4)	6,093		6,023				6,093		6,035
Average annual rent per occupied unit	$	98,088	$	93,533			$	98,089	$	93,347

_______________________________________

(2)From our third quarter 2024 presentation of Same-Store, no properties were added or removed.

(4)Represents average occupied units as reported by the operators for the nine-month period.

Merger-Combined Same-Store Adjusted NOI and Total Portfolio Adjusted NOI increased primarily as a result of the following:

•increased rates for resident fees; and

•higher occupancy; partially offset by

•higher costs of labor, management fees, repairs and maintenance, utilities, and other operating expenses.

Other Income and Expense Items

The following table summarizes the results of our other income and expense items for the three and nine months ended September 30, 2025 and 2024 (in thousands):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2025		2024		Change		2025		2024		Change
Interest income and other	$	15,529	$	14,301	$	1,228	$	47,156	$	27,884	$	19,272
Interest expense	76,784		74,105		2,679		224,540		209,922		14,618
Depreciation and amortization	262,317		280,019		(17,702)		796,779		782,736		14,043
General and administrative	19,907		23,216		(3,309)		66,789		73,233		(6,444)
Transaction and merger-related costs	2,420		7,134		(4,714)		18,169		122,113		(103,944)
Impairments and loan loss reserves (recoveries), net	(54)		441		(495)		(117)		11,346		(11,463)
Gain (loss) on sales of real estate, net	11,500		62,325		(50,825)		13,136		187,624		(174,488)
Other income (expense), net	1,160		982		178		(9,658)		83,502		(93,160)
Income tax benefit (expense)	1,206		(1,938)		3,144		(3,256)		(18,364)		15,108
Equity income (loss) from unconsolidated joint ventures	(176,291)		(3,834)		(172,457)		(176,691)		(1,407)		(175,284)
Noncontrolling interests' share in earnings	(7,274)		(6,866)		(408)		(21,856)		(18,036)		(3,820)

Interest income and other

Interest income and other increased for the three and nine months ended September 30, 2025 primarily as a result of: (i) secured loans funded in 2024 and 2025 and (ii) seller financing provided in connection with the disposition of two outpatient medical buildings in November 2024, partially offset by principal repayments on loans receivable in 2024 and 2025. Interest income and other further increased for the nine months ended September 30, 2025 as a result of (i) seller financing provided in connection with the disposition of 59 outpatient medical buildings in July 2024 and (ii) mezzanine and secured loans receivable acquired as part of the Merger.

Interest expense

Interest expense increased for the three months ended September 30, 2025 primarily as a result of: (i) the issuance of $500 million aggregate principal amount of 5.38% senior unsecured notes due 2035, which closed in February 2025, (ii) the issuance of $500 million aggregate principal amount of 4.75% senior unsecured notes due 2033, which closed in August 2025, and (iii) higher borrowings under the commercial paper program, partially offset by: (i) the repayment of $348 million aggregate principal amount of 3.40% senior unsecured notes in February 2025 and (ii) the repayment of $452 million aggregate principal amount of 4.00% senior unsecured notes in June 2025. Interest expense further increased for the nine months ended September 30, 2025 as a result of: (i) debt assumed as part of the Merger, including $1.25 billion aggregate principal amount of senior unsecured notes, $400 million aggregate principal amount of the 2028 Term Loan, and $128 million aggregate principal amount of mortgage debt and (ii) borrowings under the 2029 Term Loan, which closed in March 2024.

Depreciation and amortization

Depreciation and amortization expense decreased for the three months ended September 30, 2025 primarily as a result of dispositions of real estate in 2024 and 2025, partially offset by development and redevelopment projects placed in service during 2024 and 2025. Depreciation and amortization expense increased for the nine months ended September 30, 2025 primarily as a result of assets acquired as part of the Merger.

General and administrative

General and administrative expenses decreased for the three and nine months ended September 30, 2025 primarily as a result of (i) lower compensation expense and (ii) merger-related synergies.

Transaction and merger-related costs

Transaction and merger-related costs decreased for the three and nine months ended September 30, 2025 primarily as a result of costs of combining operations with Physicians Realty Trust that were incurred in 2024. The decrease in transaction and merger-related costs for the nine months ended September 30, 2025 was partially offset by costs incurred in 2025 related to investments we are no longer pursuing.

Impairments and loan loss reserves (recoveries), net

Impairments and loan loss reserves (recoveries), net decreased for the nine months ended September 30, 2025 as a result of a decrease in loan loss reserves under the current expected credit losses model, which is primarily due to (i) reserves recognized in 2024 on loans receivable acquired as part of the Merger, (ii) changes in operating performance and fair values of the underlying collateral of the Company's loans receivable, and (iii) recoveries related to loans repaid during the nine months ended September 30, 2025, partially offset by new and extended loans during 2024 and 2025.

Gain (loss) on sales of real estate, net

Gain on sales of real estate, net decreased during the three and nine months ended September 30, 2025 as a result of (i) no dispositions of real estate during the three months ended March 31, 2025, (ii) the $3 million gain on sale of one outpatient medical land parcel which was sold during the three months ended June 30, 2025, and (iii) the $12 million gain on sales of two outpatient medical buildings which were sold during the three months ended September 30, 2025, as compared to (i) the $3 million gain on sales of two outpatient medical buildings which were sold during the three months ended March 31, 2024, (ii) the $122 million gain on sales of a portfolio of seven lab buildings and 11 outpatient medical buildings which were sold during the three months ended June 30, 2024, and (iii) the $60 million gain on sales of a portfolio of 59 outpatient medical buildings which were sold during the three months ended September 30, 2024. Refer to Note 5 to the Consolidated Financial Statements for additional information regarding dispositions of real estate and the associated gain (loss) on sales recognized.

Other income (expense), net

Other income (expense), net decreased for the nine months ended September 30, 2025 primarily as a result of a gain upon change of control related to the sale of a 65% interest in two lab buildings in San Diego, California to a third-party in January 2024, partially offset by casualty-related losses recognized in 2025.

Income tax benefit (expense)

Income tax benefit increased for the three months ended September 30, 2025 primarily as a result of the income tax benefit from the other-than-temporary impairment charge on the Needham Land Parcel JV, as discussed below, partially offset by an increase in operating income associated with our CCRCs. Income tax expense decreased for the nine months ended September 30, 2025 primarily as a result of: (i) the income tax expense incurred in connection with the sale of a 65% interest in two lab buildings in San Diego, California to a third-party in January 2024, (ii) the tax benefit from casualty-related losses recognized in 2025, and (iii) the aforementioned impacts to the income tax benefit from the other-than-temporary impairment charge affecting the three months ended September 30, 2025.

Equity income (loss) from unconsolidated joint ventures

Equity income (loss) from unconsolidated joint ventures decreased for the three and nine months ended September 30, 2025 primarily as a result of other-than-temporary impairment charges on two lab unconsolidated joint ventures, the South San Francisco JVs and the Needham Land Parcel JV, partially offset by the preferred return on the HQ Point Preferred Equity Investment.

Noncontrolling interests' share in earnings

Noncontrolling interests' share in earnings increased for the nine months ended September 30, 2025 primarily as a result of increased income from consolidated joint ventures acquired as part of the Merger.

Liquidity and Capital Resources

We anticipate that our cash flows from operations, available cash balances, and cash from our various financing activities will be adequate for the next 12 months and for the foreseeable future for purposes of: (i) funding recurring operating expenses; (ii) meeting debt service requirements; and (iii) satisfying funding of distributions to our stockholders and non-controlling interest members. Distributions are made using a combination of cash flows from operations, funds available under our bank line of credit (the "Revolving Facility") and commercial paper program, proceeds from the sale of properties, and other sources of cash available to us.

In addition to funding the activities above, our principal liquidity needs for the next 12 months are to:

•fund capital expenditures, including tenant improvements and leasing costs;

•fund future acquisition, transactional, and development and redevelopment activities; and

•fund loans receivable and other investment commitments.

Our longer term liquidity needs include the items listed above as well as meeting debt service requirements.

We anticipate satisfying these future needs using one or more of the following:

•cash flows from operations;

•sale of, or exchange of ownership interests in, properties or other investments;

•borrowings under our Revolving Facility and commercial paper program;

•issuance of additional debt, including unsecured notes, term loans, and mortgage debt; and/or

•issuance of common or preferred stock or its equivalent, including sales of common stock under the ATM Program (as defined below).

Our ability to access the capital markets impacts our cost of capital and ability to refinance maturing indebtedness, as well as our ability to fund future acquisitions and development through the issuance of additional securities or secured debt. Changes in general market and economic conditions as well as credit ratings impact our ability to access capital and directly impact our cost of capital. Our 2029 Term Loan, our two senior unsecured delayed draw term loans with an aggregate principal amount of $500 million (the "2027 Term Loans"), our 2028 Term Loan, and our Revolving Facility accrue interest at the Secured Overnight Financing Rate ("SOFR") plus a margin that depends on the credit ratings of our senior unsecured long-term debt. We also pay a facility fee on the entire commitment under our Revolving Facility that depends upon our credit ratings. As of October 22, 2025, we had long-term credit ratings of Baa1 from Moody's and BBB+ from S&P Global, and short-term credit ratings of P-2 from Moody's and A-2 from S&P Global.

A downgrade in credit ratings by Moody's or S&P Global may have a negative impact on (i) the interest rates of our Revolving Facility, 2027 Term Loans, 2028 Term Loan, and 2029 Term Loan, (ii) facility fees for our Revolving Facility, and (iii) the pricing of notes issued under our commercial paper program and senior unsecured notes. While a downgrade in our credit ratings would adversely impact our cost of borrowing, we believe we would continue to have access to the unsecured debt markets, and we could also seek to enter into one or more secured debt financings, issue additional securities, including under our ATM Program, or dispose of certain assets to fund future operating costs, capital expenditures, or acquisitions, although no assurances can be made in this regard. Refer to "Market Trends and Uncertainties" above for a more comprehensive discussion of the potential impact of economic and market conditions on our business.

Changes in Material Cash Requirements and Off-Balance Sheet Arrangements

Debt.Our material cash requirements related to debt increased by $416 million to $9.1 billion at September 30, 2025, when compared to December 31, 2024, primarily as a result of: (i) the issuance of $500 million aggregate principal amount of 5.38% senior unsecured notes due 2035, (ii) the issuance of $500 million aggregate principal amount of 4.75% senior unsecured notes due 2033, and (iii) a $218 million increase in notes outstanding under our commercial paper program, partially offset by the repayment upon maturity of: (i) $452 million aggregate principal amount of 4.00% senior unsecured notes and (ii) $348 million aggregate principal amount of 3.40% senior unsecured notes. See Note 10 to the Consolidated Financial Statements for additional information about our debt commitments.

Development and redevelopment commitments. Our material cash requirements related to development and redevelopment projects and Company-owned tenant improvements decreased by $28 million to $256 million at September 30, 2025, when compared to December 31, 2024, primarily as a result of construction spend on projects in development and redevelopment, partially offset by commitments on projects placed into development and redevelopment during the period.

Construction loan commitments.Our material cash requirements to provide additional principal on loans for redevelopment and capital expenditure projects increased by $36 million to $121 million at September 30, 2025, when compared to December 31, 2024. This increase was the result of outstanding commitments on secured loans executed during the nine months ended September 30, 2025, partially offset by a reduction in remaining commitments due to loan fundings and repayments during the nine months then ended. See Note 7 to the Consolidated Financial Statements for additional information.

Other investment commitments. During the nine months ended September 30, 2025, we funded $45 million of our $50 million HQ Point Preferred Equity Investment. At September 30, 2025, our remaining funding commitment related to the HQ Point Preferred Equity Investment was $5 million, which is expected to be funded in 2025. See Note 8 to the Consolidated Financial Statements for additional information. Additionally, as of September 30, 2025, we had aggregate investments of $3 million in funds that make venture capital investments in various early-stage technology solutions ("Other Equity Investments"). At September 30, 2025, our remaining funding commitment related to the Other Equity Investments was $9 million, which is expected to be funded over the next four years. See Note 16 to the Consolidated Financial Statements for additional information.

Redeemable noncontrolling interests.Our material cash requirements related to redeemable noncontrolling interests increased by $25 million to $28 million at September 30, 2025, when compared to December 31, 2024. The values of these redeemable noncontrolling interests are subject to change based on the assessment of redemption value at each redemption date. As of September 30, 2025, the estimated redemption value of the redeemable noncontrolling interests that have met the conditions for redemption is $15 million. The estimated redemption value of the redeemable noncontrolling interests that will meet the conditions for redemption upon completion of each of the related development projects is $13 million. See Note 12 to the Consolidated Financial Statements for additional information.

Distribution and Dividend Requirements.Our dividend policy on our common stock is to distribute a percentage of our cash flow to ensure that we meet the dividend requirements of the Code, relative to maintaining our REIT status, while still allowing us to retain cash to fund capital improvements and other investment activities. Under the Code, REITs may be subject to certain federal income and excise taxes on undistributed taxable income. In February 2025, our Board of Directors declared an increase in the quarterly common stock cash dividend, from $0.300 to $0.305 per share, resulting in an annualized dividend of $1.220 per share. Commencing in April 2025, our Board of Directors also transitioned to a practice of paying the quarterly common stock cash dividend on a monthly basis, which are declared quarterly. Our future common stock cash dividends, if and as declared, may vary and will be determined by the Board based upon the circumstances prevailing at the time, including our financial condition. There have been no other changes to our distribution and dividend requirements during the nine months ended September 30, 2025.

Off-Balance Sheet Arrangements. We own interests in certain unconsolidated joint ventures as described in Note 8 to the Consolidated Financial Statements. Four of these joint ventures have aggregate mortgage debt of $871 million, of which our share is $200 million. Except in limited circumstances, our risk of loss is limited to our investment in the applicable joint venture. Additionally, as of September 30, 2025, we had 16 outstanding letter of credit obligations totaling $16 million.

There have been no other material changes, outside of the ordinary course of business, during the nine months ended September 30, 2025 to the material cash requirements or material off-balance sheet arrangements disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024 under "Material Cash Requirements" and "Off-Balance Sheet Arrangements" in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations."

Cash Flow Summary

The following summary discussion of our cash flows is based on the Consolidated Statements of Cash Flows and is not meant to be an all-inclusive discussion of the changes in our cash flows for the periods presented below.

The following table sets forth changes in cash flows (in thousands):


	Nine Months Ended September 30,
	2025		2024		Change
Net cash provided by (used in) operating activities	$	957,875	$	786,966	$	170,909
Net cash provided by (used in) investing activities	(629,053)		119,975		(749,028)
Net cash provided by (used in) financing activities	(353,395)		(833,919)		480,524

Operating Cash Flows

Our cash flows from operations are dependent upon the occupancy levels of our buildings, rental rates on leases, our tenants' performance on their lease obligations, the level of operating expenses, and other factors. Our net cash provided by operating activities increased $171 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily as a result of: (i) a decrease in merger-related costs, (ii) an increase in Adjusted NOI from properties acquired as part of the Merger and acquisitions of real estate in 2025, (iii) developments and redevelopments placed in service during 2024 and 2025, (iv) annual rent increases, and (v) new leasing and renewal activity. The increase in net cash provided by operating activities was partially offset by: (i) an increase in cash paid for interest and (ii) a decrease in Adjusted NOI from dispositions of real estate in 2024 and 2025.

Investing Cash Flows

Our cash flows from investing activities are generally used to fund acquisitions, developments, and redevelopments of real estate, net of proceeds received from sales of real estate and repayments on loans receivable. Our net cash used in investing activities increased $749 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily as a result of the following: (i) a decrease in proceeds from sales of real estate, (ii) an increase in cash used for development and redevelopment of real estate, (iii) proceeds received from the Callan Ridge JV transaction in 2024, (iv) an increase in cash used for real estate asset acquisitions, (v) lower net repayments on loans receivable, and (vi) an increase in cash used for investments in unconsolidated joint ventures. The increase in net cash used in investing activities was partially offset by cash paid in connection with the Merger in 2024.

Financing Cash Flows

Our cash flows from financing activities are generally impacted by issuances and/or repurchases of equity, borrowings and repayments under our bank line of credit and commercial paper program, senior unsecured notes, term loans, and mortgage debt, net of dividends paid to common shareholders. Our net cash used in financing activities decreased $481 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily as a result of the following: (i) higher net issuances under the commercial paper program, (ii) an increase in proceeds received from the issuances of senior unsecured notes, (iii) lower repurchases of common stock under our share repurchase programs, (iv) lower distributions to noncontrolling interests, and (v) higher contributions from noncontrolling interests. The decrease in net cash used in financing activities was partially offset by: (i) an increase in cash used to repay senior unsecured notes that reached maturity in 2025, (ii) a decrease in proceeds received from the issuance of term loans, and (iii) an increase in dividends paid on common stock.

Debt

In February 2025, we repaid $348 million aggregate principal amount of 3.40% senior unsecured notes at maturity. Also in February 2025, we issued $500 million aggregate principal amount of 5.38% senior unsecured notes due 2035. In June 2025, we repaid $452 million aggregate principal amount of 4.00% senior unsecured notes at maturity. In August 2025, we issued $500 million aggregate principal amount of 4.75% senior unsecured notes due 2033.

See Note 10 to the Consolidated Financial Statements for additional information about our outstanding debt.

Approximately 95% and 99% of our consolidated debt was fixed rate debt as of September 30, 2025 and 2024, respectively. At September 30, 2025, our fixed rate debt and variable rate debt had weighted average effective interest rates of 4.20% and 4.79%, respectively. At September 30, 2024, our fixed rate debt and variable rate debt had weighted average effective interest rates of 4.05% and 7.41%, respectively. As of September 30, 2025, we had the following swapped to fixed rates through interest rate swap instruments: (i) the $750 million 2029 Term Loan, (ii) the $500 million 2027 Term Loans, (iii) the $400 million 2028 Term Loan, and (iv) $142 million of variable rate mortgage debt. These interest rate swap instruments are designated as cash flow hedges. For purposes of classification of the amounts above, variable rate debt with a derivative financial instrument designated as a cash flow hedge is reported as fixed rate debt due to us having effectively established a fixed interest rate for the underlying debt instrument. For a more detailed discussion of our interest rate risk, see "Quantitative and Qualitative Disclosures About Market Risk" in Item 3 below.

Supplemental Guarantor Information

Healthpeak OP is the issuer of senior unsecured notes that were offered and sold on a registered basis under the Securities Act as described in Note 10 to the Consolidated Financial Statements. The obligations of Healthpeak OP to pay principal, premiums, if any, and interest on such senior unsecured notes are guaranteed on a full and unconditional basis by the Company, DOC DR Holdco, and DOC DR OP Sub. Additionally, DOC DR OP Sub is the issuer, as successor to the Physicians Partnership upon the Merger, of the senior unsecured notes issued by the Physicians Partnership prior to, and assumed by Healthpeak as part of, the Merger as described in Note 10 to the Consolidated Financial Statements. The obligations of DOC DR OP Sub to pay principal, premiums, if any, and interest on such senior unsecured notes are guaranteed on a full and unconditional basis by the Company, Healthpeak OP, and DOC DR Holdco.

Subsidiary issuers of obligations guaranteed by the parent are not required to provide separate financial statements, provided that the parent guarantee is "full and unconditional", the subsidiary obligor is a consolidated subsidiary of the parent company, the guaranteed security is debt or debt-like, and consolidated financial statements of the parent company have been filed. Accordingly, separate consolidated financial statements of Healthpeak OP, DOC DR Holdco, and DOC DR OP Sub have not been presented.

As permitted under Rule 13-01 of Regulation S-X, we have excluded the summarized financial information for the Company, Healthpeak OP, DOC DR Holdco, and DOC DR OP because the Company, Healthpeak OP, DOC DR Holdco, and DOC DR OP have no material assets, liabilities, or operations other than the debt financing activities described in the first paragraph of Note 10 to the Consolidated Financial Statements and their investments in non-guarantor subsidiaries, and management believes such summarized financial information would be repetitive and would not provide incremental value to investors.

Equity

At September 30, 2025, we had 695 million shares of common stock outstanding, equity totaled $8.2 billion, and our equity securities had a market value of $13.6 billion.

At-The-Market Program

In February 2023, we terminated our previous at-the-market equity offering program and established a new at-the-market equity offering program (the "ATM Program") that allows for the sale of shares of common stock having an aggregate gross sales price of up to $1.5 billion. In addition to the issuance and sale of shares of our common stock, we may also enter into one or more forward sales agreements (each, an "ATM forward contract") with sales agents for the sale of our shares of common stock under our ATM Program. The ATM Program was most recently amended in February 2025 to add certain banks as sales agents, a forward seller, and a forward purchaser under the ATM Program.

During the three and nine months ended September 30, 2025, we did notissue any shares of our common stock under any ATM program.

At September 30, 2025, $1.5 billion of our common stock remained available for sale under the ATM Program. Actual future sales of our common stock will depend upon a variety of factors, including but not limited to market conditions, the trading price of our common stock, and our capital needs. We have no obligation to sell any shares under our ATM Program.

See Note 12 to the Consolidated Financial Statements for additional information about our ATM Program.

Noncontrolling Interests

Healthpeak OP. During the nine months ended September 30, 2025, certain of our employees ("OP Unitholders") were issued approximately 2 million noncontrolling, non-managing member units in Healthpeak OP ("OP Units"). When certain conditions are met, the OP Unitholders have the right to require redemption of part or all of their OP Units for cash or shares of our common stock, at our option as managing member of Healthpeak OP. The per unit redemption amount is equal to either one share of our common stock or cash equal to the fair value of a share of common stock at the time of redemption. We classify the OP Units in permanent equity because we may elect, in our sole discretion, to issue shares of our common stock to OP Unitholders who choose to redeem their OP Units rather than using cash. As of September 30, 2025, there were approximately 4 million OP Units outstanding, and 265 thousand had met the criteria for redemption.

DownREITs.At September 30, 2025, non-managing members held an aggregate of approximately 11 million units in eight limited liability companies for which we hold controlling interests and/or are the managing member. The DownREIT units are exchangeable for an amount of cash approximating the then-current market value of shares of our common stock or, at our option, shares of our common stock. At September 30, 2025, the outstanding DownREIT units were convertible into approximately 13 million shares of our common stock.

Share Repurchase Program

On July 24, 2024, our Board of Directors approved a new share repurchase program (the "2024 Share Repurchase Program") to supersede and replace our previous program. Under the 2024 Share Repurchase Program, we may acquire shares of our common stock in the open market or other similar purchase techniques (including in compliance with the safe harbor provisions of Rule 10b-18 under the Exchange Act or pursuant to one or more plans adopted under Rule 10b5-1 promulgated under the Exchange Act), up to an aggregate purchase price of $500 million. Purchases of common stock under the 2024 Share Repurchase Program may be exercised at our discretion with the timing and number of shares repurchased depending on a variety of factors, including price, corporate and regulatory requirements, and other corporate liquidity requirements and priorities. The 2024 Share Repurchase Program expires in July 2026 and may be suspended or terminated at any time without prior notice. During the three months ended September 30, 2025, there were no repurchases of common stock under the 2024 Share Repurchase Program. During the nine months ended September 30, 2025, we repurchased 5.09 million shares of our common stock at a weighted average price of $18.50 per share for a total of $94 million. At September 30, 2025, $406 million of the Company's common stock remained available for repurchase under the 2024 Share Repurchase Program.

Shelf Registration

On February 8, 2024, the Company and Healthpeak OP jointly filed a prospectus with the SEC as part of a registration statement on Form S-3, using an automatic shelf registration process. This shelf registration statement expires on February 8, 2027 and at or prior to such time, we expect to file a new shelf registration statement. On February 5, 2025, the Company and Healthpeak OP jointly filed a post-effective amendment to the shelf registration statement to add certain subsidiaries of the Company as co-registrants and register their guarantees of the debt securities of the Company and/or Healthpeak OP as additional securities that may be offered under the prospectus included in the shelf registration statement. Under the "shelf" process, we may sell any combination of the securities described in the prospectus through one or more offerings. The securities described in the prospectus include future offerings of: (i) the Company's common stock, preferred stock, depositary shares, warrants, debt securities, and guarantees by the Company and certain of its subsidiaries of debt securities issued by Healthpeak OP, and (ii) Healthpeak OP's debt securities and guarantees by Healthpeak OP and certain other subsidiaries of the Company of debt securities issued by the Company.

Non-GAAP Financial Measures Reconciliations

The following is a reconciliation from net income (loss) applicable to common shares, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Nareit FFO, FFO as Adjusted, and AFFO (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Net income (loss) applicable to common shares	$	(117,256)	$	85,675	$	(43,335)	$	237,985
Real estate related depreciation and amortization	262,317		280,019		796,779		782,736
Healthpeak's share of real estate related depreciation and amortization from unconsolidated joint ventures	12,574		12,127		37,304		32,520
Noncontrolling interests' share of real estate related depreciation and amortization	(3,807)		(4,534)		(12,686)		(13,705)
Loss (gain) on sales of depreciable real estate, net	(11,500)		(62,325)		(13,136)		(187,624)
Loss (gain) upon change of control, net(1)	-		430		-		(77,548)
Taxes associated with real estate dispositions(2)	-		(145)		(335)		11,512
Impairments (recoveries) of real estate, net(3)	175,827		-		175,827		-
Nareit FFO applicable to common shares	318,155		311,247		940,418		785,876
Distributions on dilutive convertible units and other	4,551		4,577		13,735		11,670
Diluted Nareit FFO applicable to common shares	$	322,706	$	315,824	$	954,153	$	797,546

Impact of adjustments to Nareit FFO:
Transaction and merger-related items(4)	$	2,420	$	2,725	$	18,169	$	108,923
Other impairments (recoveries) and other losses (gains), net(5)	(54)		441		125		11,741
Casualty-related charges (recoveries), net(6)	(1,771)		1,792		6,375		588
Total adjustments	$	595	$	4,958	$	24,669	$	121,252

FFO as Adjusted applicable to common shares	$	318,750	$	316,205	$	965,087	$	907,128
Distributions on dilutive convertible units and other	4,551		4,571		13,715		11,537
Diluted FFO as Adjusted applicable to common shares	$	323,301	$	320,776	$	978,802	$	918,665

FFO as Adjusted applicable to common shares	$	318,750	$	316,205	$	965,087	$	907,128
Stock-based compensation amortization expense	4,046		3,755		10,410		11,935
Amortization of deferred financing costs and debt discounts (premiums)	7,981		7,408		23,708		19,247
Straight-line rents	(14,282)		(10,346)		(30,836)		(32,891)
AFFO capital expenditures	(27,261)		(23,510)		(76,125)		(76,744)
CCRC entrance fees(7)	12,711		11,046		36,449		30,548
Deferred income taxes	(179)		585		4,989		2,330
Amortization of above (below) market lease intangibles, net	(8,105)		(7,887)		(28,402)		(23,325)
Other AFFO adjustments	(1,687)		(1,277)		(1,303)		(4,947)
AFFO applicable to common shares	291,974		295,979		903,977		833,281
Distributions on dilutive convertible units and other	4,550		4,576		13,735		11,671
Diluted AFFO applicable to common shares(7)	$	296,524	$	300,555	$	917,712	$	844,952

Refer to footnotes on the next page.

_______________________________________

(1)The nine months ended September 30, 2024 includes a gain upon change of control related to the sale of a 65% interest in two lab buildings in San Diego, California. The gain upon change of control is included in other income (expense), net in the Consolidated Statements of Operations.

(2)The nine months ended September 30, 2024 includes non-cash income tax expense related to the sale of a 65% interest in two lab buildings in San Diego, California.

(3)The three and nine months ended September 30, 2025 includes other-than-temporary impairment charges on certain unconsolidated real estate joint ventures. During the three months ended September 30, 2025, we concluded that the decline in fair values of these joint ventures was other-than-temporary due to the length of time and extent of which the fair values have been less than carrying value. Other-than-temporary impairment charges on our unconsolidated joint ventures are recognized in equity income (loss) from unconsolidated joint ventures in the Consolidated Statements of Operations.

(4)The three and nine months ended September 30, 2025 and 2024 include costs related to the Merger, which are primarily comprised of advisory, legal, accounting, tax, information technology, post-combination severance and stock compensation expense, and other costs of combining operations with Physicians Realty Trust that were incurred during the period. The nine months ended September 30, 2025 also includes $6 million of costs incurred related to certain investments we are no longer pursuing. For the three and nine months ended September 30, 2024, these costs were partially offset by termination fee income of $4 million and $13 million, respectively, associated with Graphite Bio, Inc., which later merged with LENZ Therapeutics, Inc. in March 2024, for which the lease terms were modified to accelerate expiration of the lease to December 2024. This termination fee income is included in rental and related revenues on the Consolidated Statements of Operations, but is excluded from FFO as Adjusted.

(5)The three and nine months ended September 30, 2025 and 2024 include reserves and (recoveries) for expected loan losses recognized in impairments and loan loss reserves (recoveries), net in the Consolidated Statements of Operations.

(6)Casualty-related charges (recoveries), net are recognized in other income (expense), net, equity income (loss) from unconsolidated joint ventures, and noncontrolling interests' share in earnings in the Consolidated Statements of Operations.

(7)During the year ended December 31, 2024, we changed our definition of AFFO to adjust for the non-refundable entrance fees collected in excess of (less than) the related amortization as we believe the cash collection of these fees is a more meaningful representation of the performance of the CCRC reportable segment in the determination of AFFO. Diluted AFFO applicable to common shares utilizing the prior definition for the three months ended September 30, 2025 and 2024 was $283.8 million and $289.5 million, respectively. Diluted AFFO applicable to common shares utilizing the prior definition for the nine months ended September 30, 2025 and 2024 was $881.3 million and $814.4 million, respectively.

Critical Accounting Estimates

The preparation of financial statements in conformity with U.S. GAAP requires our management to use judgment in the application of critical accounting estimates and assumptions. We base estimates on the best information available to us at the time, our experience and on various other assumptions believed to be reasonable under the circumstances. These estimates could affect our financial position or results of operations. If our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, it is possible that different accounting would have been applied, resulting in a different presentation of our consolidated financial statements. From time to time, we re-evaluate our estimates and assumptions. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. A discussion of accounting estimates that we consider critical in that they may require complex judgment in their application or require estimates about matters that are inherently uncertain is included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations." During the three months ended September 30, 2025, we added additional considerations to our critical accounting estimate as described below:

Impairment of Unconsolidated Joint Ventures

On a quarterly basis, we review our equity method investments for indicators of impairment. If an equity method investment shows indicators of impairment, we compare the fair value of the equity method investment to its carrying value. When we determine a decline in fair value below carrying value is other-than-temporary, an impairment is recorded. In our evaluation, we consider various factors, including the performance of each investment, our investment strategy, and market conditions, including the impact to market rents, capitalization rates, and supply and demand for rentable space.

The fair values of our equity method investments are determined based on discounted cash flows which are subjective and consider assumptions regarding forecasted occupancy, market rents, capitalization rates, discount rates, expected capital expenditures, and land values. While we believe our assumptions are reasonable, changes in these assumptions may have a material impact on our consolidated financial statements.

Healthpeak Properties Inc. published this content on October 24, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on October 24, 2025 at 20:17 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]

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