National Healthcare Properties (NHP) Q1 2025 earnings summary

Executive summary

• Entered 2025 with strong momentum after internalizing management in September 2024, resulting in estimated $25 million annualized cost savings and full payment of internalization fee by Q1 2025, positioning as an independent, internally managed REIT.

• Board continues to evaluate a potential public listing or other liquidity events, with preparations for a new corporate credit facility and future equity offerings.

• Executed $168.4 million in strategic asset dispositions in Q1 2025, with an additional $9.1 million after quarter end and $23.9 million under LOI or contract.

• High-quality OMF and SHOP portfolios delivered strong same-store occupancy and NOI growth, with SHOP segment benefiting from favorable demographics and tight supply.

• Portfolio as of March 31, 2025: 181 properties in 30 states, including 136 OMFs and 45 SHOPs with 3,939 units.

Financial highlights

• Adjusted funds from operations (AFFO) rose 10.7% quarter-over-quarter to $0.31 per share, nearly 5x higher year-over-year; AFFO was $8.8 million for Q1 2025.

• Q1 2025 net loss attributable to common stockholders improved to $5.0 million from $19.0 million in Q1 2024, driven by gains on property sales and lower operating fees.

• Same-store cash NOI for SHOP grew 18% year-over-year and 13.5% sequentially; OMF same-store cash NOI declined 2.3% year-over-year.

• Net leverage improved from 10.4x to 9.7x quarter-over-quarter; net debt to gross asset value at 44.6% as of March 31, 2025.

• $70 million in debt paydowns during Q1 2025, with an additional $21.7 million facility repaid after quarter end.

Outlook and guidance

• Management expects continued organic growth in SHOP occupancy and cash NOI, supported by favorable demographic trends and limited new supply.

• Ongoing strategic disposition pipeline with $23.9 million under LOI or contract as of May 8, 2025.

• Sufficient liquidity is anticipated to meet obligations for at least the next twelve months, with funding from cash on hand, operations, property sales, and potential new financings.

• No further stock dividends are planned; future dividend policy will depend on cash flow improvements.