Community Healthcare Trust (CHCT) Q1 2025 earnings summary

Executive summary

• Operates a diversified healthcare real estate portfolio across 36 states with 201 properties and 313 tenants as of March 31, 2025, 90.9% leased with a 6.7-year average lease term.

• Net income for Q1 2025 was $1.6 million, down from $3.7 million in Q1 2024, due to higher interest and operating expenses.

• FFO was $12.7 million ($0.47/share) and AFFO was $14.7 million ($0.55/share) for Q1 2025, both down from the prior year.

• Acquired a behavioral residential treatment facility for $9.7 million and disposed of a building in Ohio for $0.6 million.

• Seven properties under definitive purchase agreements totaling $169.5 million, with anticipated returns of 9.1%–9.75%.

Financial highlights

• Total revenue for Q1 2025 was $30.1 million, up from $29.3 million in Q1 2024.

• Property operating expenses rose to $6.1 million, mainly due to seasonal utility and snowplow costs.

• General and administrative expenses increased to $5.1 million, driven by non-cash amortization and seasonal compensation.

• Interest expense increased to $6.4 million, reflecting higher average balances and rates.

• Declared a quarterly dividend of $0.47 per share, continuing a record of quarterly increases since IPO.

Outlook and guidance

• Seven properties under contract for $169.5 million expected to close through 2027, with anticipated returns of 9.1%–9.75%.

• Pipeline includes a $4.1 million property and a $60 million development term sheet for dialysis clinics.

• $28.2 million in tenant improvement commitments and $3.3 million in capital improvement commitments as of March 31, 2025.

• Will use asset sales, revolver draws, and potentially equity issuance for acquisitions, avoiding significant leverage increases.

• Expect NOI contribution from a redeveloped property in Q4 2025 due to licensure and rent abatement.