What changed in this filing

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Item 1. Business

2023-03-17 compared with 2022-03-25 · 259 added, 189 removed, 223 unchanged (67% of the section changed)

The use of the words “we,” “us” or “our” refers to Griffin-American Healthcare REIT III, Inc.

and its subsidiaries, including Griffin-American Healthcare REIT III Holdings, LP, for periods prior to the Merger, as defined below, and American Healthcare REIT, Inc.

(formerly known as Griffin-American Healthcare REIT IV, Inc.) and its subsidiaries, including American Healthcare REIT Holdings, LP (formerly known as Griffin-American Healthcare REIT III Holdings, LP), for periods following the Merger, except where otherwise noted.

Certain historical information of Griffin-American Healthcare REIT IV, Inc.

is included for background purposes.

American Healthcare REIT, Inc., a Maryland corporation, owns a diversified portfolio of clinical healthcare real estate properties, focusing primarily on medical office buildings, skilled nursing facilities, senior housing, hospitals and other healthcare-related facilities.

The use of the words “we,” “us” or “our” refers to Griffin-American Healthcare REIT III, Inc., or GAHR III, and its subsidiaries, including Griffin-American Healthcare REIT III Holdings, LP, for periods prior to the Merger, as defined below, and American Healthcare REIT, Inc.

(formerly known as Griffin-American Healthcare REIT IV, Inc., or GAHR IV) and its subsidiaries, including American Healthcare REIT Holdings, LP (formerly known as Griffin-American Healthcare REIT III Holdings, LP), for periods following the Merger, except where otherwise noted.

Certain historical information of GAHR IV is included for background purposes.

American Healthcare REIT, Inc., a Maryland corporation, is a leading internally-managed real estate investment trust, or REIT, that owns a diversified portfolio of clinical healthcare real estate properties, focusing primarily on medical office buildings, or MOBs, senior housing, skilled nursing facilities, or SNFs, hospitals and other healthcare-related facilities.

We have built a fully-integrated management platform, with approximately 113 employees, that operates clinical healthcare properties throughout the United States, the United Kingdom, and the Isle of Man.

We also operate healthcare-related facilities utilizing the structure permitted by the REIT Investment Diversification and Empowerment Act of 2007, which is commonly referred to as a “RIDEA” structure (the provisions of the Internal Revenue Code of 1986, as amended, or the Code, authorizing the RIDEA structure were enacted as part of the Housing and Economic Recovery Act of 2008).

Our healthcare facilities operated under a RIDEA structure include our senior housing operating properties, or SHOP (formerly known as senior housing — RIDEA), and our integrated senior health campuses.

Our healthcare facilities operated under a RIDEA structure include our senior housing operating properties, or SHOP, and our integrated senior health campuses.

We have originated and acquired secured loans and may also originate and acquire other real estate-related investments on an infrequent and opportunistic basis.

We generally seek investments that produce current income;

however, we have selectively developed, and may continue to selectively develop, real estate properties.

We qualified to be taxed as a real estate investment trust, or REIT, under the Code for federal income tax purposes, and we intend to continue to qualify to be taxed as a REIT.

however, we have selectively developed, and may continue to selectively develop, healthcare real estate properties.

We have elected to be taxed as a REIT for U.S.

federal income tax purposes.

We believe that we have been organized and operated, and we intend to continue to operate, in conformity with the requirements for qualification and taxation as a REIT under the Code.

Merger of Griffin-American Healthcare REIT III, Inc.

and Griffin-American Healthcare REIT IV, Inc.

On June 23, 2021, Griffin-American Healthcare REIT III, Inc., a Maryland corporation, or GAHR III, Griffin-American Healthcare REIT III Holdings, LP, a Delaware limited partnership, or our operating partnership that subsequent to the Merger on October 1, 2021 described below is also referred to as the surviving partnership, Griffin-American Healthcare REIT IV, Inc., a Maryland corporation, or GAHR IV, its subsidiary Griffin-American Healthcare REIT IV Holdings, LP, a Delaware limited partnership, or GAHR IV Operating Partnership, and Continental Merger Sub, LLC, a Maryland limited liability company and a newly formed wholly owned subsidiary of GAHR IV, or Merger Sub, entered into an Agreement and Plan of Merger, or the Merger Agreement.

On October 1, 2021, pursuant to the Merger Agreement, (i) GAHR III merged with and into Merger Sub, with Merger Sub being the surviving company, or the REIT Merger, and (ii) GAHR IV Operating Partnership merged with and into our operating partnership, with our operating partnership being the surviving entity and being renamed American Healthcare REIT Holdings, LP, or the Partnership Merger, and, together with the REIT Merger, the Merger.

On October 1, 2021, pursuant to an Agreement and Plan of Merger dated June 23, 2021, or the Merger Agreement, GAHR III merged with and into Continental Merger Sub, LLC, a Maryland limited liability company and newly formed wholly owned subsidiary of GAHR IV, or Merger Sub, with Merger Sub being the surviving company, or the REIT Merger.

On October 1, 2021, also pursuant to the Merger Agreement, Griffin-American Healthcare REIT IV Holdings, LP, a Delaware limited partnership and subsidiary and operating partnership of GAHR IV, or GAHR IV Operating Partnership, merged with and into Griffin-American Healthcare REIT III Holdings, LP, a Delaware limited partnership, or our operating partnership, with our operating partnership being the surviving entity, or the Partnership Merger.

We collectively refer to the REIT Merger and the Partnership Merger as the Merger.

Following the Merger on October 1, 2021, our company, or the Combined Company, was renamed American Healthcare REIT, Inc.

and our operating partnership, also referred to as the surviving partnership, was renamed American Healthcare REIT Holdings, LP.

The REIT Merger was intended to qualify as a reorganization under, and within the meaning of, Section 368(a) of the Code.

As a result of and at the effective time of the Merger, the separate corporate existence of GAHR III and GAHR IV Operating Partnership ceased.

At the effective time of the REIT Merger, each issued and outstanding share of GAHR III’s common stock, $0.01 par value per share, converted into the right to receive 0.9266 shares of GAHR IV’s Class I common stock, $0.01 par value per share.

Further, at the effective time of the Partnership Merger, (i) each unit of limited partnership interest in the surviving partnership outstanding as of immediately prior to the effective time of the Partnership Merger was converted automatically into the right to receive 0.9266 of a Partnership Class I Unit, as defined in the agreement of limited partnership, as amended, of the surviving partnership, and (ii) each unit of limited partnership interest in GAHR IV Operating Partnership outstanding as of immediately prior to the effective time of the Partnership Merger was converted automatically into the right to receive one unit of limited partnership interest of the surviving partnership of like class.

At the effective time of the REIT Merger and prior to the reverse stock split, each issued and outstanding share of GAHR III’s common stock, $0.01 par value per share, converted into the right to receive 0.9266 shares of GAHR IV’s Class I common stock, $0.01 par value per share.

Further, at the effective time of the Partnership Merger and prior to the reverse stock split, (i) each unit of limited partnership interest in the surviving partnership outstanding immediately prior to the effective time of the Partnership Merger was converted automatically into the right to receive 0.9266 of a Partnership Class I Unit, as defined in the agreement of limited partnership, as amended, of the surviving partnership and (ii) each unit of limited partnership interest in GAHR IV Operating Partnership immediately prior to the effective time of the Partnership Merger was converted automatically into the right to receive one unit of limited partnership interest of the surviving partnership of like class.

AHI Acquisition

Also on June 23, 2021, GAHR III;

Also on October 1, 2021, immediately prior to the consummation of the Merger, GAHR III acquired a newly formed entity, American Healthcare Opps Holdings, LLC, or NewCo, which we refer to as the AHI Acquisition, pursuant to a contribution and exchange agreement dated June 23, 2021, or the Contribution Agreement, between GAHR III;

our operating partnership;

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and Jeffrey T.

Hanson, our former Chief Executive Officer and current Executive Chairman of the Board of Directors, Danny Prosky, our former Chief Operating Officer and current Chief Executive Officer and President, and Mathieu B.

Streiff, our former Executive Vice President, General Counsel and current Chief Operating Officer, or collectively, the AHI Principals, entered into a contribution and exchange agreement, or the Contribution Agreement, pursuant to which, among other things, GAHR III agreed to acquire a newly formed entity, American Healthcare Opps Holdings, LLC, or NewCo, which we refer to as the AHI Acquisition.

owned substantially all of the business and operations of AHI, as well as all of the equity interests in (i) Griffin-American Healthcare REIT IV Advisor, LLC, or GAHR IV Advisor, a subsidiary of AHI that served as the external advisor of GAHR IV, and (ii) Griffin-American Healthcare REIT III Advisor, LLC, or GAHR III Advisor, also referred to as our former advisor, a subsidiary of AHI that served as the external advisor of GAHR III.

Hanson, the non-executive Chairman of our board of directors, or our board, Danny Prosky, our Chief Executive Officer and President, and Mathieu B.

Streiff, one of our directors, or collectively, the AHI Principals.

NewCo owned substantially all of the business and operations of AHI, as well as all of the

equity interests in (i) Griffin-American Healthcare REIT IV Advisor, LLC, or GAHR IV Advisor, a subsidiary of AHI that served as the external advisor of GAHR IV, and (ii) Griffin-American Healthcare REIT III Advisor, LLC, or GAHR III Advisor, also referred to as our former advisor, a subsidiary of AHI that served as the external advisor of GAHR III.

Pursuant to the Contribution Agreement, AHI contributed substantially all of its business and operations to the surviving partnership, including its interest in GAHR III Advisor and GAHR IV Advisor, and Griffin Capital contributed its then-current ownership interest in GAHR III Advisor and GAHR IV Advisor to the surviving partnership.

In exchange for these contributions, the surviving partnership issued limited partnership units, or OP units.

Subject to working capital and other customary adjustments, the total approximate value of these OP units at the time of consummation of the transactions contemplated by the Contribution Agreement, and prior to the reverse stock split, was approximately $131,674,000, with a reference value for purposes thereof of $8.71 per OP unit, such that the surviving partnership issued 15,117,529 OP units as consideration, or the Closing Date Consideration.

Following the consummation of the Merger and the AHI Acquisition, the Combined Company became self-managed.

See “Operating Partnership and Former Advisor” below for a further discussion.

On October 1, 2021, the AHI Acquisition closed immediately prior to the consummation of the Merger, and pursuant to the Contribution Agreement, AHI contributed substantially all of its business and operations to the surviving partnership, including its interest in GAHR III Advisor and GAHR IV Advisor, and Griffin Capital contributed its then-current ownership interest in GAHR III Advisor and GAHR IV Advisor to the surviving partnership.

In exchange for these contributions, the surviving partnership issued limited partnership units, or surviving partnership OP units.

Subject to working capital and other customary adjustments, the total approximate value of these surviving partnership OP units at the time of consummation of the transactions contemplated by the Contribution Agreement was approximately $131,674,000, with a reference value for purposes thereof of $8.71 per unit, such that the surviving partnership issued 15,117,529 surviving partnership OP units as consideration, or the Closing Date Consideration.

Following the consummation of the Merger and the AHI Acquisition, the Combined Company has become self-managed.

As of December 31, 2021, such surviving partnership OP units are owned by AHI Group Holdings, LLC, or AHI Group Holdings, which is owned and controlled by the AHI Principals, Platform Healthcare Investor T-II, LLC, Flaherty Trust and a wholly owned subsidiary of Griffin Capital, or collectively, the NewCo Sellers.

In addition to the Closing Date Consideration, pursuant to the Contribution Agreement, we may in the future pay cash “earnout” consideration to AHI based on the fees that we may earn from our potential sponsorship of, and investment advisory services rendered to, American Healthcare RE Fund, L.P., a healthcare-related, real-estate-focused, private investment fund under consideration by AHI, or the Earnout Consideration.

The Earnout Consideration is uncapped in amount and, if ever payable by us to AHI, will be due on the seventh anniversary of the closing of the AHI Acquisition (subject to acceleration in certain events, including if we achieve certain fee-generation milestones from our sponsorship of the private investment fund).

AHI’s ability to receive the Earnout Consideration is also subject to vesting conditions relating to the private investment fund’s deployed equity capital and the continuous employment of at least two of the AHI Principals throughout the vesting period.

As of December 31, 2021, the fair value of such cash earnout consideration was estimated to be $0.

Such OP units were owned by AHI Group Holdings, LLC, or AHI Group Holdings, which is owned and controlled by the AHI Principals, Platform Healthcare Investor TII, LLC, Flaherty Trust and a wholly owned subsidiary of Griffin Capital, or collectively, the NewCo Sellers.

The AHI Acquisition was treated as a business combination for accounting purposes, with GAHR III as both the legal and accounting acquiror of NewCo.

While GAHR IV was the legal acquiror of GAHR III in the REIT Merger, GAHR III was determined to be the accounting acquiror in the REIT Merger in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 805, Business Combinations , or ASC Topic 805, after considering the relative share ownership and the composition of the governing body of the Combined Company.

While GAHR IV was the legal acquiror of GAHR III in the REIT Merger, GAHR III was determined to be the accounting acquiror in the REIT Merger in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 805, Business Combinations , after considering the relative share ownership and the composition of the governing body of the Combined Company.

Thus, the financial information set forth herein subsequent to the consummation of the Merger and the AHI Acquisition reflects results of the Combined Company, and the financial information set forth herein prior to the Merger and the AHI Acquisition reflects GAHR III’s results.

For this reason, period to period comparisons may not be meaningful.

Please see Note 3, Business Combinations, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion of the Merger and the AHI Acquisition.

See Note 4, Business Combinations — 2021 Business Combinations, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion of the Merger and the AHI Acquisition.

Operating Partnership and Former Advisor

We conduct substantially all of our operations through our operating partnership.

Through September 30, 2021, we were externally advised by our former advisor pursuant to an advisory agreement, as amended, or the Advisory Agreement, between us and our former advisor, and GAHR IV was externally advised by its former advisor pursuant to a separate advisory agreement between those parties.

On June 23, 2021, we also entered into a Mutual Consent Regarding Waiver of Subordination of Asset Management Fees, or the Mutual Consent, pursuant to which, for the period from the date the Mutual Consent was entered into until the earlier to occur of (i) the closing of the Merger, or (ii) the termination of the Merger Agreement, the parties waived the requirement in the Advisory Agreement that our stockholders receive distributions in an amount equal to 5.0% per annum, cumulative, non-compounded, of their invested capital before we would be obligated to pay an asset management fee.

Our former advisor and the former advisor of GAHR IV used their best efforts, subject to the oversight and review of each company’s board of directors, to, among other things, provide asset management, property management, acquisition, disposition and other advisory services on behalf of the respective company consistent with such company’s investment policies and objectives.

We conduct substantially all of our operations through our operating partnership and we are the sole general partner of our operating partnership.

As of December 31, 2022 and 2021, we owned an approximately 95.0% and 94.9% general partnership interest therein, respectively, and the remaining 5.0% and 5.1%, respectively, was owned by the NewCo Sellers.

Through September 30, 2021, we were externally advised by our former advisor pursuant to an advisory agreement, as amended, or the Advisory Agreement, between us and our former advisor.

Our former advisor, subject to the oversight and review of our board, provided asset management, property management, acquisition, disposition and other advisory services on our behalf consistent with our investment policies and objectives.

Following the Merger and the AHI Acquisition, we became self-managed and are no longer externally advised.

As a result, any fees that would have otherwise been payable to our former advisor or the former advisor of GAHR IV, are no longer being paid.

Prior to the Merger and AHI Acquisition, our former advisor was 75.0% owned and managed by wholly owned subsidiaries of AHI, and 25.0% owned by a wholly owned subsidiary of Griffin Capital, or collectively, our former co-sponsors.

Prior to the AHI Acquisition, AHI was 47.1% owned by AHI Group Holdings, 45.1% indirectly owned by Digital

Bridge Group, Inc.

DBRG) (formerly known as Colony Capital, Inc.), or Digital Bridge, and 7.8% owned by James F.

Flaherty III, a former partner of Colony Capital.

We were not affiliated with Griffin Capital, Digital Bridge or Mr.

As a result, any fees that would have otherwise been payable to our former advisor are no longer being paid to a third party.

Upon consummation of the AHI Acquisition, we redeemed all 51 limited partnership units that our former advisor held in our operating partnership, as well as all 52 limited partnership units held by GAHR IV Advisor in GAHR IV Operating Partnership.

Also, on October 1, 2021 and in connection with the AHI Acquisition, our operating partnership redeemed all 5,148 shares of our common stock owned by our former advisor and all 5,208 shares of our Class T common stock owned by GAHR IV Advisor in GAHR IV.

Prior to the Merger and the AHI Acquisition, our former advisor was 75.0% owned and managed by wholly owned subsidiaries of AHI, and 25.0% owned by a wholly owned subsidiary of Griffin Capital, or collectively, our former co-sponsors.

Prior to the AHI Acquisition, AHI was 47.1% owned by AHI Group Holdings, 45.1% indirectly owned by DigitalBridge Group, Inc.

DBRG), or DigitalBridge, and 7.8% owned by James F.

Flaherty III.

We were not affiliated with Griffin Capital, DigitalBridge or Mr.

however, we were affiliated with our former advisor, AHI and AHI Group Holdings.

Please see the “Merger of Griffin-American Healthcare REIT III, Inc.

and Griffin-American Healthcare REIT IV, Inc.” and “AHI Acquisition” sections above for a further discussion of our operations effective October 1, 2021.

As a result of the Merger and the AHI Acquisition on October 1, 2021, we, through our direct and indirect subsidiaries, own approximately 94.9% of our operating partnership and the remaining 5.1% is owned by the NewCo Sellers.

See Note 13, Redeemable Noncontrolling Interests, and Note 14, Equity – Noncontrolling Interests in Total Equity, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

Public Offering

GAHR IV raised $754,118,000 through a best efforts initial public offering, or the initial offering, and issued 75,639,681 aggregate shares of its Class T and Class I common stock.

In addition, during the initial offering, GAHR IV issued 3,253,535 aggregate shares of its Class T and Class I common stock pursuant to GAHR IV’s distribution reinvestment plan, as amended, or the DRIP, for a total of $31,021,000 in distributions reinvested.

Following the deregistration of the initial offering, GAHR IV continued issuing shares of its common stock pursuant to the DRIP through a subsequent offering, or the 2019 GAHR IV DRIP Offering.

See the “Merger of Griffin-American Healthcare REIT III, Inc.

and Griffin-American Healthcare REIT IV, Inc.” and “AHI Acquisition” sections above for a further discussion.

Public Offerings

GAHR IV raised $754,118,000 through a best efforts initial public offering, or the initial offering, and issued 18,909,920 aggregate shares of its Class T common stock and Class I common stock.

In addition, during the initial offering, GAHR IV

issued 813,384 aggregate shares of its Class T common stock and Class I common stock pursuant to GAHR IV’s distribution reinvestment plan, as amended, or the DRIP, for a total of $31,021,000 in reinvested distributions.

Following the deregistration of the initial offering, GAHR IV continued issuing shares of its common stock up to $100,000,000 pursuant to the DRIP through a subsequent offering, or the 2019 GAHR IV DRIP Offering, pursuant to a Registration Statement on Form S-3 under the Securities Act of 1933, as amended, or the Securities Act.

GAHR IV commenced offering shares pursuant to the 2019 GAHR IV DRIP Offering on March 1, 2019, following the termination of the initial offering on February 15, 2019.

On March 18, 2021, the GAHR IV board of directors authorized the suspension of the DRIP, effective as of April 1, 2021.

On October 4, 2021, our board of directors, or our board, authorized the reinstatement of the DRIP.

We continue to offer up to $100,000,000 of shares of our common stock to be issued pursuant to the DRIP under an existing Registration Statement on Form S-3 under the Securities Act of 1933, as amended, or the Securities Act, filed by GAHR IV.

As of December 31, 2021, a total of $54,637,000 in distributions were reinvested that resulted in 5,755,013 shares of common stock being issued pursuant to the 2019 GAHR IV DRIP Offering.

We collectively refer to the DRIP portion of GAHR IV’s initial offering and the 2019 GAHR IV DRIP Offering as our DRIP Offerings.

See Note 14, Equity — Distribut ion Reinvestment Plan, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

Due to the ongoing COVID-19 pandemic in the United States and globally, since March 2020, our residents, tenants, operating partners and managers have been materially impacted.

The rise of the Delta and Omicron variants of COVID-19, and government and public health agencies’ responses to potential future resurgences in the virus, further contributes to the prolonged economic impact and uncertainties caused by the COVID-19 pandemic.

There is also uncertainty regarding the acceptance of available vaccines and boosters and the public’s receptiveness to those measures.

As the COVID-19 pandemic is still impacting the healthcare system, it continues to present challenges for us as an owner and operator of healthcare facilities, making it difficult to ascertain the long-term impact the COVID-19 pandemic will have on real estate markets in which we own and/or operate properties and our portfolio of investments.

On October 4, 2021, our board authorized the reinstatement of the DRIP, as amended, or the AHR DRIP, to offer up to $100,000,000 of shares of our common stock pursuant to a Registration Statement on Form S-3 under the Securities Act previously filed by GAHR IV, or the AHR DRIP Offering.

On November 14, 2022, our board suspended the AHR DRIP Offering beginning with distributions declared, if any, for the quarter ending December 31, 2022.

As a result of the suspension of the AHR DRIP Offering, unless and until our board reinstates the AHR DRIP Offering, stockholders who are current participants in the AHR DRIP were and will be paid distributions in cash.

As of December 31, 2022, a total of $91,448,000 in distributions were reinvested that resulted in 2,431,695 shares of common stock being issued pursuant to the AHR DRIP.

On September 16, 2022, we filed with the U.S.

Securities and Exchange Commission, or SEC, a Registration Statement on Form S-11 (File No.

333-267464) with respect to a proposed public offering by us of our shares of common stock in conjunction with a contemplated listing of our common stock on the New York Stock Exchange, or NYSE.

Such registration statement and contemplated listing are not yet effective.

On November 10, 2022, our board approved charter amendments to effect, on November 15, 2022, a one-for-four reverse stock split of our common stock and a corresponding reverse split of the OP units, or the Reverse Splits.

All numbers of common shares and per share data, as well as the OP units, in this Annual Report on Form 10-K have been retroactively adjusted for all periods presented to give effect to the Reverse Splits.

See Note 14, Equity, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion of our public offerings.

On March 15, 2023, our board, at the recommendation of the audit committee of our board, which is comprised solely of independent directors, unanimously approved and established an updated estimated per share net asset value, or NAV, of our common stock of $31.40.

We provide this updated estimated per share NAV annually to assist broker-dealers in connection with their obligations under Financial Industry Regulatory Authority, or FINRA, Rule 2231 with respect to customer account statements.

The updated estimated per share NAV is based on the estimated value of our assets less the estimated value of our liabilities, divided by the number of shares outstanding on a fully diluted basis, calculated as of December 31, 2022.

The valuation was performed in accordance with the methodology provided in Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Institute for Portfolio Alternatives, or the IPA, in April 2013, in addition to guidance from the SEC.

See our Current Report on Form 8-K filed with the SEC on March 17, 2023 for more information on the methodologies and assumptions used to determine, and the limitations and risks of, our updated estimated per share NAV.

Our residents, tenants, operating partners and managers, our industry and the U.S.

economy continue to be adversely affected by the COVID-19 pandemic and related supply chain disruptions and labor shortages.

While the COVID 19 pandemic is subsiding, the timing and extent of the economic recovery from the COVID-19 pandemic is dependent upon many factors, including the emergence and severity of COVID-19 variants, the effectiveness and frequency of booster vaccinations and the duration and implications of restrictions and safety measures.

As the lasting effect of the COVID-19 pandemic is still impacting the healthcare system to a certain extent, it continues to present challenges for us as an owner and operator of healthcare facilities, making it difficult to ascertain the long-term impact the COVID-19 pandemic will have on real estate markets in which we own and/or operate properties and our portfolio of investments.

We have evaluated the impacts of the COVID-19 pandemic on our business thus far and incorporated information concerning such impacts into our assessments of liquidity, impairment and collectability from tenants and residents as of December 31, 2022.

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Key Developments

• On October 1, 2021, we completed the Merger and the AHI Acquisition and were renamed American Healthcare REIT, Inc., which resulted in the creation of a self-managed, diversified healthcare real estate investment trust with approximately $4.3 billion in healthcare real estate assets.

• On October 4, 2021, our board authorized the reinstatement of the DRIP and as a result, beginning with the October 2021 distribution, which was paid in November 2021, stockholders who previously enrolled as participants in the DRIP (including former GAHR III stockholders who participated in the DRIP offerings conducted by GAHR III) were able to receive distributions in shares of our common stock pursuant to the terms of the DRIP, instead of cash distributions.

Our board also authorized record date distributions to our Class T and Class I stockholders of record as of each monthly record date from October 2021 through March 2022, equal to $0.033333333 per share of our common stock, which is equal to an annualized distribution rate of $0.40 per share.

The distributions were paid in cash or shares of our common stock pursuant to the DRIP.

• In addition, on October 4, 2021, our board amended and restated our share repurchase plan, which amended the repurchase price with respect to repurchases resulting from the death or qualifying disability (as such term is defined in the share repurchase plan) of a stockholder from 100% of the price paid by the stockholder to acquire shares of our Class T common stock or Class I common stock, as applicable, to the most recently published estimated per share net asset value, or NAV.

On October 4, 2021, our board also authorized the partial reinstatement of our share repurchase plan with respect to requests to repurchase shares resulting from the death or qualifying disability of stockholders, effective with respect to qualifying repurchases for the fiscal quarter ending December 31, 2021, which were paid on January 4, 2022.

• During 2021, through our majority-owned subsidiary, Trilogy Investors, LLC, or Trilogy, GAHR III expanded our integrated senior health campuses segment by $165,818,000 primarily through the acquisition of previously leased campuses and completion of development projects, as well as the acquisition of land for development.

• On January 19, 2022, we terminated the 2018 Credit Facility (as defined below) and through our operating partnership, entered into a credit agreement that supersedes and replaces the 2019 Credit Facility (as defined below) with a credit facility for an aggregate maximum principal amount up to $1,050,000,000 .

See Note 9, Lines of Credit and Term Loans, and Note 22, Subsequent Events, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

• On January 19, 2022, we, through our operating partnership, entered into a credit agreement for a credit facility with an aggregate maximum principal amount up to $1,050,000,000.

See Note 9, Lines of Credit and Term Loans, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

• On September 16, 2022, we filed with the SEC a Registration Statement on Form S-11 (File No.

333-267464), with respect to a proposed public offering of our shares of common stock in conjunction with a contemplated listing of our common stock on the NYSE, or the Proposed Listing.

Such registration statement and contemplated listing are not yet effective.

The potential public offering is subject to market conditions and other factors, and there can be no assurance as to whether, or when, any such offering may be completed, or as to the size, public offering price or other terms of such offering.

• On November 10, 2022, our board approved charter amendments to effect a one-for-four reverse stock split of our common stock and a corresponding reverse split of the OP units on November 15, 2022.

• In connection with the Proposed Listing, on November 14, 2022, our board suspended the AHR DRIP Offering beginning with the distributions declared, if any, for the quarter ending December 31, 2022.

As a result of the suspension of the AHR DRIP Offering, unless and until our board reinstates the AHR DRIP Offering, stockholders who are current participants in the AHR DRIP will be paid future distributions in cash.

On November 14, 2022, our board also suspended our share repurchase plan beginning with share repurchase requests for the quarter ending December 31, 2022.

All share repurchase requests, including requests resulting from the death or qualifying disability of stockholders, commencing with the quarter ended December 31, 2022, will not be processed, will be considered canceled in full and will not be considered outstanding repurchase requests.

See Note 14, Equity — Common Stock, and Note 14, Equity— Share Repurchase Plan, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

• On December 20, 2022, we, through our majority-owned subsidiary, Trilogy Investors, LLC, or Trilogy, entered into an amendment to the 2019 Trilogy Credit Agreement to increase the aggregate maximum principal amount from $360,000,000 to $400,000,000.

See Note 9, Lines of Credit and Term Loans, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

• We appointed three new independent directors, Scott A.

Estes in August 2022 and Marvin R.

O'Quinn and Valerie Richardson in January 2023, as part of our board's commitment to diversity when considering director candidates with a mix of experience, knowledge, age, gender and backgrounds.

• In 2022, we launched our Environmental, Social and Governance, or ESG, program and began conducting a materiality assessment to assist us in prioritizing our efforts and maximizing the efficacy of our ESG program.

• To further assist us in establishing a work environment that promotes Diversity, Equity, and Inclusion, or DE&I, for our employees, in 2022, we developed a DE&I action plan and provided DE&I education for all employees and executive leadership.

• During 2022, we expanded our integrated senior health campuses and SHOP segments by $253,908,000 primarily through the acquisition of buildings and campuses and completed development projects.

See Note 3, Real Estate Investments, Net, and Note 4, Business Combinations, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

• We improved our corporate governance structure and procedures in 2022 by amending our Code of Business Conduct and Ethics and our Whistleblower Policy and adopting Corporate Governance Guidelines, an Insider Trading Policy, a Regulation FD and Disclosure Policy and a Related Party Transactions Policy.

• We entered into an interest rate swap transaction, or the Swap, with Fifth Third Financial Risk Solutions, a division of Fifth Third Bank, with an effective date of February 1, 2023.

We entered into the Swap to mitigate the potential interest rate risk associated with $275,000,000 of our floating rate term loan under our existing credit facility, effectively fixing the interest rate associated with that portion of our term loan and limiting our exposure to interest rate movements.

See Note 22, Subsequent Events — Interest Rate Swap, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K, for a further discussion.

• In response to interest rates that have increased significantly since the beginning of 2022, from a Federal Funds Rate of 0.08% as of January 2022 to 4.57% as of February 2023, and greater uncertainty surrounding further interest rate movements, our board elected to reduce our quarterly distribution to $0.25 per share in order to preserve our liquidity, better align distributions with available cash flows and position our company for its long-term strategic goals.

On March 15, 2023, our board authorized a reduced quarterly distribution from $0.40 per share to $0.25 per share to our Class T common stockholders and Class I common stockholders of record as of the close of business on April 4, 2023.

The distribution for the quarter commencing January 1, 2023 to March 31, 2023, which will be paid on or about April 18, 2023, represents an annualized distribution rate of $1.00 per share.

See our Current Report on Form 8-K filed with the SEC on March 17, 2023 for more information.

• On March 15, 2023, our board, at the recommendation of the audit committee of our board, comprised solely of independent directors, unanimously approved and established an updated estimated per share NAV of our common stock of $31.40 as of December 31, 2022.

For a further discussion, see Part II, Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities, and Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations.

• As of March 25, 2022, we owned and/or operated 182 properties, comprising 191 buildings, and 122 integrated senior health campuses including completed development projects, or approximately 19,461,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $4,299,886,000.

For further discussion, see Part II, Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities, and Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations.

• As of March 17, 2023, we owned and/or operated 314 buildings and integrated senior health campuses, or approximately 19,957,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $4,626,119,000.

In addition, as of March 17, 2023, we also owned a real estate-related debt investment purchased for $60,429,000.

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The contents of that site are not incorporated by reference in, or otherwise a part of, this filing.

We make our periodic and current reports and all amendments to those reports available at www.americanhealthcarereit.com as soon as reasonably practicable after such materials are electronically filed with the United States Securities and Exchange Commission, or the SEC.

They also are available for printing by any stockholder upon request.

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Access to these filings is free of charge.

Investment Objectives

Our investment objectives are:

• to preserve, protect and return our stockholders’ capital contributions;

• to pay regular cash distributions;

• to realize growth in the value of our investments upon our ultimate sale of such investments.

Our board may change our investment objectives if it determines it is advisable and in the best interest of our stockholders.

Business Objectives and Growth Strategies

Our business objectives are to grow our cash flows, maintain financial flexibility, increase the value of our portfolio, make regular cash distributions to our stockholders, and generate risk-adjusted returns through the following growth strategies:

• capture embedded growth from COVID-19 recovery through leasing and expense controls at our senior housing facilities, integrated senior health campuses and SNFs;

• external growth through disciplined and targeted acquisitions to expand our diversified portfolio;

• continue to develop integrated senior health campuses through experienced development partner (i.e., Trilogy);

• provide sustained stability through consistent MOB performance with opportunity for revenue growth driven by occupancy gains and improving mark-to-market lease spreads.

Investment Strategy

We have and we may continue to invest in a diversified portfolio of clinical healthcare real estate properties, focusing primarily on medical office buildings, skilled nursing facilities, senior housing, hospitals and other healthcare-related facilities, such as long-term acute care centers, surgery centers, memory care facilities, specialty medical and diagnostic service facilities, laboratories and research facilities, pharmaceutical and medical supply manufacturing facilities and offices leased to tenants in healthcare-related industries.

We have acquired, and may continue to acquire, properties either directly or jointly with third parties.

We have disposed, and may continue to dispose, non-core properties from time to time to improve the quality of our portfolio .

We also have originated and acquired, and may continue to originate or acquire, secured loans and other real estate-related investments on an infrequent and opportunistic basis.

We generally seek investments that produce current income;

however, we have selectively developed, and may continue to selectively develop, real estate properties.

however, we have selectively developed, are currently developing (through Trilogy), and may continue to selectively develop, real estate properties.

Our portfolio may include properties in various stages of development other than those producing current income.

These stages include unimproved land both with and without entitlements and permits, property to be redeveloped and repositioned, newly constructed properties and properties in lease-up or other stabilization, all

of which have limited or no relevant operating histories and current income.

Our board makes such investment determinations based upon a variety of factors, including the available risk-adjusted returns for such properties when compared with other available properties, the appropriate diversification of the portfolio and our objectives of realizing both current income and capital appreciation upon the ultimate sale of properties.

We seek to maximize long-term stockholder value by generating sustainable growth in cash flows and portfolio value.

In order to achieve these objectives, we may invest using a number of investment structures, which may include direct acquisitions, joint ventures, leveraged investments, issuing securities for property and direct and indirect investments in real estate.

We make such investment determinations based upon a variety of factors, including the anticipated risk-adjusted returns for such properties when compared with other available properties, the appropriate diversification of the portfolio and our objectives of realizing both current income and capital appreciation.

We seek to grow our cash flows, maintain financial flexibility, increase the value of our portfolio, make regular cash distributions, and generate risk-adjusted returns for our stockholders through the business objectives and growth strategies discussed above.

investments in real estate.

In order to maintain our exemption from regulation as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act, we may be required to limit our investments in certain types of real estate-related investments.

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For each of our investments, regardless of property type, we seek to invest in properties with the following attributes:

• Strong Local Health Systems and Operating Partners.

We seek to invest in properties associated with strong health systems and operators, that provide exceptional care, have dominant market share and/or are critical to the healthcare delivery system in the communities that they serve.

We seek to acquire properties that are suitable for their intended use with a quality of construction that is capable of sustaining the property’s investment potential for the long-term, assuming funding of budgeted maintenance, repairs and capital improvements.

We seek to acquire properties that are located in established or otherwise appropriate markets, with access and visibility suitable to meet the needs of its occupants.

In addition to United States properties, we also seek to acquire international properties that meet our investment criteria.

In addition to United States properties, we may also seek to acquire international properties that meet our investment criteria.

Supply and Demand.

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These determinations are based in part on an evaluation of local and regional economic, demographic and regulatory factors affecting the property.

For instance, we favor markets that indicate a growing population and employment base or markets that exhibit potential limitations on additions to supply, such as barriers to new construction.

For instance, we favor markets that indicate a growing population and employment base and markets that exhibit potential limitations on additions to supply, such as barriers to new construction.

Barriers to new construction include lack of available land, stringent zoning restrictions and states where certificates of need are required.

In addition, we generally seek to limit our investments in areas that have limited potential for growth.

Conversely, we generally seek to limit our investments in areas that have limited potential for growth.

• Predictable Capital Needs.

We seek to acquire properties where the future expected capital needs can be reasonably projected in a manner that would enable us to meet our objectives of growth in cash flows and preservation of capital and stability.

We seek to acquire properties where the future expected capital needs can be reasonably projected in a manner that would enable us to meet our objectives.

• Cash Flows.

We seek to acquire properties where the current and projected cash flows, including the potential for appreciation in value, would enable us to meet our overall investment objectives.

We seek to acquire properties where the current and projected cash flows, including the potential for appreciation in value, would enable us to maximize long-term stockholder value.

We evaluate cash flows as well as expected growth and the potential for appreciation.

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Real Estate Investments

We have invested, and may continue to invest, in a diversified portfolio of clinical healthcare real estate investments, focusing primarily on medical office buildings, skilled nursing facilities, senior housing, hospitals and other healthcare-related facilities.

We generally seek investments that produce current income.

Our investments may include:

• medical office buildings;

• skilled nursing facilities;

We expect our real estate investments to include:

• integrated senior health campuses;

• senior housing facilities;

• healthcare-related facilities operated utilizing a RIDEA structure.

Our real estate investments may also include:

• long-term acute care facilities;

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• pharmaceutical and medical supply manufacturing facilities;

• offices leased to tenants in healthcare-related industries.

We generally seek to acquire real estate of the types described above that will best enable us to meet our investment objectives, taking into account the diversification of our portfolio at the time, relevant real estate and financial factors, the location, the income-producing capacity and the prospects for long-range appreciation of a particular property and other considerations.

• offices leased to tenants in healthcare-related industries, including life sciences.

We generally seek to acquire real estate of the types described above that will best enable us to meet our investment objectives, taking into account, among other things, the diversification of our portfolio at the time, relevant real estate and financial factors, the location, the income-producing capacity and the prospects for long-range appreciation of a particular property.

As a result, we may acquire properties other than the types described above.

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In addition, we have participated in sale-leaseback transactions, in which we purchase real estate investments and lease them back to the sellers of such properties.

We will use our best efforts to structure any such sale-leaseback transaction such that the lease will be characterized as a “true lease” and so that we will be treated as the owner of the property for federal income tax purposes.

Our obligation to close a transaction involving the purchase of real estate is generally conditioned upon the delivery and verification of certain documents from the seller or developer, including, where appropriate:

We seek to structure any such sale-leaseback transaction such that the lease will be characterized as a “true lease” and so that we will be treated as the owner of the property for U.S.

federal income tax purposes.

Our obligation to close a transaction involving the purchase of real estate is generally conditioned upon the delivery and verification of certain documents, including, where appropriate:

(i) plans and specifications;

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(vii) title insurance policies;

and (viii) liability insurance policies.

and (viii) the availability of property and liability insurance policies.

In determining whether to purchase a particular real estate investment, we may obtain an option on such property, including land suitable for development.

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As a REIT, we are prohibited from operating healthcare-related facilities directly;

however, we have leased, and may continue to lease, healthcare-related facilities that we acquire to wholly owned taxable REIT subsidiaries, or TRS.

In such an event, our TRS will engage a third party in the business of operating healthcare-related facilities to manage the property utilizing a RIDEA structure permitted by the Code.

however, we have leased, and may continue to lease, healthcare-related facilities that we acquire to wholly owned taxable REIT subsidiaries, or TRS, utilizing a RIDEA structure permitted by the Code.

In such an event, our TRS will engage a third party in the business of operating healthcare-related facilities to manage the property.

Through our TRS, we bear all operational risks and liabilities associated with the operation of such healthcare-related facilities unlike our triple-net leased properties.

Such operational risks and liabilities include, but are not limited to, resident quality of care claims and governmental reimbursement matters.

Such operational risks and liabilities might include, but are not limited to, resident quality of care claims and governmental reimbursement matters.

Development and Construction Activities

On an opportunistic basis, we have selectively developed, and may continue to selectively develop, real estate assets within our integrated senior health campuses segment when market conditions warrant, which may be funded through capital that we, and in certain circumstances, our joint venture partners, provide.

As of December 31, 2021, we had two integrated senior health campuses under development.

On an opportunistic basis, we have selectively developed, are currently developing (through Trilogy), and may continue to selectively develop, real estate assets within our integrated senior health campuses segment and other segments of our portfolio when market conditions warrant, which may be funded through capital that we, and in certain circumstances, our joint venture partners, provide.

In doing so, we may be able to reduce overall purchase costs by developing property versus purchasing an existing property.

We retain and will continue to retain independent contractors to perform the actual construction work on tenant improvements, as well as property development.

Terms of Leases

The terms and conditions of any lease we enter into with our tenants may vary substantially.

However, we expect that a majority of our tenant leases will require the tenant to pay or reimburse us for some or all of the operating expenses of the building based on the tenant’s proportionate share of rentable space within the building.

Operating expenses typically include, but are not limited to, real estate and other taxes, utilities, insurance and building repairs, and other building operation and

management costs.

For our multi-tenanted properties, we generally expect to be responsible for the replacement of certain capital improvements affecting a property, including structural components of a property such as the roof of a building, and other capital improvements such as parking facilities.

We expect that many of our tenant leases will have terms of five or more years, some of which may have renewal options.

Substantially all of our leases with residents at our SHOP and integrated senior health campuses are for a term of one year or less, which creates the opportunity for operators to adjust rents to reflect current market conditions.

Joint Ventures

We have entered into, and we may continue to enter into, joint ventures, general partnerships, and other arrangements with one or more institutions or individuals, including real estate developers, operators, owners, investors and others, for the purpose of acquiring real estate.

Our investment in Trilogy is an example of a joint venture into which we have entered.

Such joint ventures may be leveraged with debt financing or unleveraged.

We have entered into, and may continue to enter into, joint ventures to further diversify our investments or to access investments which meet our investment criteria that would otherwise be unavailable to us.

In determining whether to invest in a particular joint venture, we

will evaluate the real estate that such joint venture owns or is being formed to own under the same criteria described elsewhere in this Annual Report on Form 10-K for the selection of our other properties.

In determining whether to invest in a particular joint venture, we will evaluate the real estate that such joint venture owns or is being formed to own under the same criteria described elsewhere in this Annual Report on Form 10-K for the selection of our other properties.

However, we will not participate in tenant in common syndications or transactions.

Joint ventures with unaffiliated third parties may be structured such that the investment made by us and the co-venturer are on substantially different terms and conditions.

This type of investment structure may result in the co-venturer receiving more of the cash flows, including appreciation, of an investment than we would receive.

See Item 1A, Risk Factors — Risks Related to Joint Ventures, for a further discussion.

Our entering into such joint ventures may result in certain conflicts of interest.

Joint ventures with unaffiliated third parties may be structured such that the investment made by us and the other joint venture party are on substantially different terms and conditions.

This type of investment structure may result in the other joint venture party receiving more of the cash flows, including appreciation, of an investment than we would receive, or may result in certain conflict of interest.

See Item 1A, Risk Factors — Risks Related to Joint Ventures, for a further discussion.

Real Estate-Related Investments

In addition to our acquisition of medical office buildings, skilled nursing facilities, senior housing, hospitals and other healthcare-related facilities, on an infrequent and opportunistic basis, we have invested, and may continue to invest, in real estate-related investments, including loans and securities investments.

Investing In and Originating Loans

In addition to our acquisition of properties, we have invested on an infrequent and opportunistic basis and may continue to invest, in real estate-related investments, including loans and securities investments.

Investment in Real Estate Mortgages

We have invested, and we may continue to invest, in first and second mortgage loans, mezzanine loans and bridge loans.

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Mortgage participation investments are investments in partial interests of mortgages of the type described above that are made and administered by third-party mortgage lenders.

We may also make seller financing loans in connection with the disposition of our properties.

In evaluating prospective loan investments, we consider factors, including, but not limited to:

the ratio of the investment amount to the underlying property’s value, current and projected cash flows of the property, the degree of liquidity of the investment, the quality, experience and creditworthiness of the borrower and, in the case of mezzanine loans, the ability to acquire the underlying real property.

(i) the ratio of the investment amount to the underlying property’s value;

(ii) current and projected cash flows of the property;

(iii) the degree of liquidity of the investment;

(iv) the quality, experience and creditworthiness of the borrower;

and (v) in the case of mezzanine loans, the ability to acquire the underlying real property.

Our criteria for making or investing in loans are substantially the same as those involved in our investment in properties.

We do not intend to make loans to other persons, to underwrite securities of other issuers or to engage in the purchase and sale of any types of investments other than those relating to real estate.

We will not make or invest in mortgage loans on any one property if the aggregate amount of all mortgage loans outstanding on the property, including our loan, would exceed an amount equal to 85.0% of the appraised value of the property, as determined by an appraiser, unless we find substantial justification due to other underwriting criteria;

We generally will not make or invest in mortgage loans on any one property if the aggregate amount of all mortgage loans outstanding on the property, including our loan, would exceed an amount equal to 85.0% of the appraised value of the property, as determined by an appraiser, unless we find substantial justification due to other underwriting criteria;

however, our policy generally will be that the aggregate amount of all mortgage loans outstanding on the property, including our loan, would not exceed 75.0% of the appraised value of the property.

We may find such justification in connection with the purchase of loans in cases in which we believe there is a high probability of our foreclosure upon the property in order to acquire the underlying assets and in which the cost of the loan investment does not exceed the fair market value of the underlying property.

We will not invest in or make loans unless an appraisal has been obtained concerning the underlying property, except for those loans insured or guaranteed by a government or government agency.

We will not invest in or make loans unless an appraisal has been obtained concerning the underlying property, except for those loans insured or guaranteed by a government or government agency or in connection with seller financing loans.

In the event the transaction is with any of our directors or their respective affiliates, the appraisal will be obtained from a certified independent appraiser to support its determination of fair market value.

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We have not established a portfolio turnover policy with respect to loans we invest in or originate.

Investing in Securities

Investment in Other Securities

We have invested, and may continue to invest, in debt securities such as commercial mortgage-backed securities issued by other unaffiliated real estate companies.

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Our investments in real estate-related equity securities will involve special risks relating to the particular issuer of the equity securities, including the financial condition and business outlook of the issuer.

Our Strategies and Policies With Respect to Borrowing

Financing Policies

We have used, and intend to continue to use, secured and unsecured debt as a means of providing additional funds for the acquisition of properties and real estate-related investments.

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As of December 31, 2022, our aggregate borrowings were 48.5% of the combined market value of all of our real estate and real estate-related investments.

We use our best efforts to obtain financing on the most favorable terms available to us and refinance assets during the term of a loan only in limited circumstances, such as when a decline in interest rates makes it beneficial to prepay an existing loan, when an existing loan matures or if an attractive investment becomes available and the proceeds from the refinancing can be used to purchase such investment.

We seek to obtain financing on the most favorable terms available to us and refinance assets during the term of a loan only in limited circumstances, such as when a decline in interest rates makes it beneficial to prepay an existing loan, when an existing loan matures or if an attractive investment becomes available and the proceeds from the refinancing can be used to purchase such investment.

The benefits of the refinancing may include increased cash flows resulting from reduced debt service requirements, an increase in distributions from proceeds of the refinancing, and an increase in diversification and assets owned if all or a portion of the refinancing proceeds are reinvested.

If we incur mortgage indebtedness, we will endeavor to obtain level payment financing, meaning that the amount of debt service payable would be substantially the same each year, although some mortgages are likely to provide for one large payment and we may incur floating or adjustable rate financing when our board determines it to be in our best interest.

Sale or Disposition of Assets

We have disposed, and may continue to dispose, of assets.

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(v) the investment was acquired as part of a portfolio acquisition and does not meet our general acquisition criteria;

(vi) an opportunity exists to enhance overall

investment returns by raising capital through sale of the investment;

or (vii) the sale of the investment is in the best interest of our stockholders.

(vi) an opportunity exists to enhance overall investment returns by raising capital through sale of the investment;

(vii) the sale of the investment is in the best interest of our stockholders;

or (viii) in connection with the strategic goals of one of our joint ventures.

The determination of whether a particular property or real estate-related investment should be sold or otherwise disposed of will be made after consideration of the relevant factors, including prevailing economic conditions, with a view toward maximizing our investment objectives.

Terms of Leases

The terms and conditions of any lease we enter into with our tenants may vary substantially from those we describe in this Annual Report on Form 10-K.

However, we expect that a majority of our leases will require the tenant to pay or reimburse us for some or all of the operating expenses of the building based on the tenant’s proportionate share of rentable space within the building.

Operating expenses typically include, but are not limited to, real estate and other taxes, utilities, insurance and building repairs, and other building operation and management costs.

We expect to be responsible for the replacement of specific structural components of a property such as the roof of the building or the parking lot.

We expect that many of our leases will have terms of five or more years, some of which may have renewal options.

Tax Status and Distribution Policy

As a REIT, we generally will not be subject to federal income tax on taxable income that we distribute to our stockholders.

We qualified, and elected to be taxed, as a REIT under the Code for federal income tax purposes, and we intend to continue to qualify to be taxed as a REIT.

To maintain our qualification as a REIT, we must meet certain organizational and operational requirements, including a requirement to currently distribute at least 90.0% of our annual taxable income, excluding net capital gains, to our stockholders.

Existing Internal Revenue Service, or IRS, guidance includes a safe harbor pursuant to which publicly offered REITs can satisfy the distribution requirement by distributing a combination of cash and stock to stockholders.

In general, to qualify under the safe harbor, each stockholder must elect to receive either cash or stock, and the aggregate cash component of the distribution to stockholders must represent at least 20.0% of the total distribution.

We have elected to be taxed as a REIT for U.S.

federal income tax purposes commencing with our taxable year ended December 31, 2016.

We believe that we have been organized and operated, and we intend to continue to operate, in conformity with the requirements for qualification and taxation as a REIT under the Code.

Our qualification as a REIT, and maintenance of such qualification, will depend on our ability to meet, on a continuing basis, various complex requirements under the Code relating to, among other things, the sources of our gross income, the composition and values of our assets, our distribution levels and the concentration of ownership of our stock.

As a REIT, we generally are not subject to U.S.

federal income tax on the REIT taxable income that we currently distribute to our stockholders.

Under the Code, REITs are subject to numerous organizational and operational requirements, including a requirement that they distribute annually at least 90.0% of their REIT taxable income to their stockholders.

If we fail to qualify as a REIT in any calendar year and do not qualify for certain statutory relief provisions, our REIT taxable income would be subject to U.S.

federal income tax at the regular corporate rate, and we would likely be precluded from qualifying for treatment as a REIT until the fifth calendar year following the year in which we fail to qualify.

Accordingly, our failure to qualify as a REIT could have a material adverse effect on us.

Even if we qualify as a REIT, we may still be subject to certain U.S.

federal, state and local taxes on our income and assets and to U.S.

federal income and excise taxes on our undistributed REIT taxable income.

In addition, subject to maintaining our qualification as a REIT, a portion of our business has been, and is likely to continue to be, conducted through, and a portion of our income may be earned in, one or more TRSs that are themselves subject to regular corporate income taxation.

We cannot predict if we will generate sufficient cash flows to continue to pay cash distributions to our stockholders on an ongoing basis or at all.

The amount of any cash distributions is determined by our board and depends on the amount of distributable funds, current and projected cash requirements, tax considerations, any limitations imposed by the terms of indebtedness we may incur and other factors.

If our investments produce sufficient cash flows, we expect to continue paying distributions to our stockholders as determined at the discretion of our board of directors.

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To the extent that any distributions to our stockholders are paid out of our current or accumulated earnings and profits, such distributions are taxable as ordinary income.

To the extent that any of our distributions exceed our current and accumulated earnings and profits, such amounts constitute a return of capital to our stockholders for federal income tax purposes, to the extent of their basis in their stock and thereafter will constitute capital gain.

To the extent that any of our distributions exceed our current and accumulated earnings and profits, such amounts constitute a return of capital to our stockholders for U.S.

federal income tax purposes, to the extent of their basis in their stock and thereafter will constitute capital gain.

Any portion of distributions to our stockholders paid from net offering proceeds or borrowings constitutes a return of capital to our stockholders.

Since September 2021, our board authorizes distributions to our stockholders of record as of a designated record date each month and pays such distributions monthly in arrears.

However, our board could, at any time, elect to pay distributions quarterly to reduce administrative costs.

Since September 2021, our board authorized distributions to our stockholders of record as of a designated record date each month and paid such distributions monthly in arrears.

Beginning with distributions made after July 2022, our board elected

to pay distributions quarterly to reduce administrative costs.

The amount of distributions we pay to our stockholders is determined by our board and is dependent on a number of factors, including funds available for the payment of distributions, our financial condition, capital expenditure requirements, annual distribution requirements needed to maintain our status as a REIT under the Code and restrictions imposed by our organizational documents and Maryland Law.

See Part II, Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities — Distributions, for a further discussion of distributions approved by our board.

We compete with many other entities engaged in the acquisition, development, leasing and financing of healthcare-related real estate investments.

Our ability to successfully compete is impacted by economic trends, availability of acceptable

investment opportunities, our ability to negotiate beneficial investment terms, availability and cost of capital, construction and development costs and applicable laws and regulations.

We compete with many other entities engaged in real estate investment activities for acquisitions and dispositions of MOBs, hospitals, SNFs, senior housing and other healthcare-related facilities.

Our ability to successfully compete is impacted by economic trends, availability of acceptable investment opportunities, our ability to negotiate beneficial investment terms, availability and cost of capital, construction and development costs, and applicable laws and regulations.

Income from our investments is dependent on the ability of our tenants and operators to compete with other healthcare operators.

These operators compete on a local and regional basis for patients and residents and the operators’ ability to successfully attract and retain patients and residents depends on key factors such as the number of properties in the local market, the quality of the affiliated health system, proximity to hospital campuses, the price and range of services available, the scope and quality of care, reputation, age and appearance of each property, demographic trends and the cost of care in each locality.

Additionally, referral sources, including physicians and managed care organizations, may change their lists of hospitals or physicians to which they refer patients or that are permitted to participate in a payor program.

As a result, we may have to provide rent concessions, incur charges for tenant improvements, or offer other inducements, or we may be unable to timely lease vacant space in our properties, all of which may have an adverse impact on our results of operations.

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Our properties are subject to various federal, state and local regulatory requirements, and changes in these laws and regulations, or their interpretation by agencies, occur frequently.

Further, our tenants and our healthcare facility operators and managers, including our TRS entities that own and operate our properties under a RIDEA structure, and our tenants are typically subject to extensive and complex federal, state and local healthcare laws and regulations relating to quality of care, government reimbursement, fraud and abuse practices, and similar laws governing the operation of healthcare facilities, and we expect the healthcare industry, in general, will continue to face increased regulation and pressure in the areas of healthcare management, fraud and provision of services, among others.

Further, our tenants and our healthcare facility operators, including our TRS entities that own and operate our properties under a RIDEA structure, are typically subject to extensive and complex federal, state and local healthcare laws and regulations relating to quality of care, government reimbursement, fraud and abuse practices, and similar laws governing the operation of healthcare facilities, and we expect the healthcare industry, in general, will continue to face increased regulation and pressure in the areas of healthcare management, fraud and provision of services, among others.

If we fail to comply with these various requirements, we may incur governmental fines or private damage awards.

While we believe that our properties are and will be in substantial compliance with all of these regulatory requirements, we do not know whether existing requirements will change or whether future requirements will require us to make significant unanticipated capital expenditures that will adversely affect our ability to make distributions to our stockholders.

We believe, based in part on third-party due diligence reports which are generally obtained at the time we acquire the properties, that all of our properties comply in all material respects with current regulations.

However, if we were required to make significant expenditures under applicable regulations, our financial condition, results of operations, cash flows and ability to satisfy our debt service obligations and to pay distributions could be adversely affected.

However, if we were required to make significant expenditures under applicable regulations, we could be materially and adversely affected.

Privacy and Security Laws and Regulations

There are various United States federal and state privacy laws and regulations that provide for consumer protection of personal health information, particularly electronic security and privacy.

Compliance with such laws and regulations may require us to, among other things, conduct additional risk analysis, modify our risk management plan, implement new policies and procedures and conduct additional training.

There are various federal and state privacy laws and regulations that provide for consumer protection of personal health information, particularly electronic security and privacy.

Compliance with such laws and regulations may require us, among other things, to conduct additional risk analysis, modify our risk management plan, implement new policies and procedures and conduct additional training.

We are generally dependent on our tenants and management companies to fulfill our compliance obligations, and we have in certain circumstances developed a program to periodically monitor compliance with such obligations.

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Generally, certain properties in our portfolio are subject to licensure, may require a certificate of need, or CON, or other certification through regulatory agencies in order to operate and participate in Medicare and Medicaid programs.

Requirements pertaining to such licensure and certification relate to the quality of care provided by the operator, qualifications of the operator’s staff and continuing compliance with applicable laws and regulations.

pertaining to such licensure and certification relate to the quality of care provided by the operator, qualifications of the operator’s staff and continuing compliance with applicable laws and regulations.

In addition, CON laws and regulations may place restrictions on certain activities such as the addition of beds at our facilities and changes in ownership.

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For a discussion of our geographic information, see Item 2, Properties — Geographic Diversification/Concentration Table, as well as Note 19, Segment Reporting, and Note 20, Concentration of Credit Risk, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K.

Corporate Responsibility — Environmental, Social and Governance (ESG)

We are committed to conducting our business in a manner that benefits all of our stakeholders and ensures a lasting and positive impact from our operations.

As a result, we measure our success not only by our ability to generate profits but also our ability to reduce our impact on the environment, affect positive social change in our community and conduct our operations in accordance with the highest ethical standards.

To achieve this, we are developing a comprehensive ESG strategy and related ESG policy.

Environmental

In 2022, we launched our ESG program and began conducting a materiality assessment to assist us in prioritizing our efforts and maximizing the efficacy of our program.

We strive to consciously manage our operations in a way that minimizes our impact on the environment and promotes sustainability.

At our headquarters, we leverage the latest technology to minimize our energy use, such as efficient and automated lighting systems, moderation, and monitoring of heating and air conditioning, and recycling paper, plastics, metals, and electronics.

In addition, we encourage all of our employees to adopt sustainable best practices.

For example, we promote the use of electronic communication over printing whenever possible and have implemented electronic approval systems.

Our corporate office in California is located in Leadership in Energy and Environmental Design (known as LEED) certified buildings.

Within our portfolio, we work with tenants and operators to implement energy efficiency wherever possible, including light-emitting diode (known as LED) retrofitting and water conservation efforts.

We follow a policy of monitoring our properties for the presence of hazardous or toxic substances.

While there can be no assurance that a material environmental liability does not exist at our properties, we are not currently aware of any environmental liability with respect to our properties that would have a material adverse effect on us.

Further, we are not aware of any material environmental liability or any unasserted claim or assessment with respect to an environmental liability that we believe would require additional disclosure or the recording of a loss contingency.

Human Capital Resources

Prior to the consummation of the Merger and the AHI Acquisition on October 1, 2021, we were externally managed by our former advisor and relied on its employees, and our executive officers were all employees of one of our former co-sponsors.

As of October 1, 2021, as a result of the Merger and the AHI Acquisition, we became self-managed and as of December 31, 2021, we have approximately 100 employees.

A s of December 31, 2022, we had approximately 113 employees.

We believe our employees are our greatest asset, and we pride ourselves on the diversity they bring to our company.

Because of this, we have implemented a number of programs to foster not only their professional growth, but also their growth as global citizens.

All of our employees are provided with a comprehensive benefits and wellness package, which may include high-quality medical, dental and vision insurance, life insurance, 401(k) matching, long-term incentive plans, educational grants, fitness programs and much more.

We provide our employees, consultants and executive officers with competitive compensation and, where applicable, opportunities for equity ownership through our 2015 Incentive Plan, as amended.

See Note 14, Equity — 2015 Incentive Plan, to the Consolidated Financial Statements that are part of this Annual Report on Form 10-K, for a further discussion.

All of our employees are provided with a comprehensive benefits and wellness package, which may include high-quality medical, dental, and vision insurance, life insurance, 401(k) matching, long-term incentive plans, educational grants, fitness programs, and other benefits.

We provide our employees, consultants and executive officers with competitive compensation and, where applicable, opportunities for equity ownership through our Amended and Restated 2015 Incentive Plan, or the AHR Incentive Plan.

See Note 14, Equity — AHR 2015 Incentive Plan, to the Consolidated Financial Statements that are part of this Annual Report on Form 10-K, for a further discussion.

We also believe that one of the keys to our success is our ability to benefit from a wide range of opinions and experiences.

We believe the best way to accomplish this is through promoting racial, gender, and generational diversity across all layers of our organization.

As of January 31, 2022, 69% of our employees are minorities and 67% are females.

Generationally, our organization is composed of 43% Millennials, 47% Generation X, and 10% Baby Boomers.

As of December 31, 2022, 69.0% of our employees were minorities and 63.7% were females.

Generationally, our organization was composed of 4.4% Generation Z, 48.7% Millennials, 39.8% Generation X and 7.1% Baby Boomers.

In addition, we have implemented a DE&I action plan to create a workplace environment that is both meaningful and rewarding to all employees and where there are no barriers to success for our employees.

Through DE&I, we create stronger teamwork and relationships that allows us to create a performance driven culture of success for one another and our stakeholders.

Health and Safety

We are committed to providing a safe and healthy workplace.

W e are committed to providing a safe and healthy workplace.

We continuously strive to meet or exceed compliance with all laws, regulations and accepted practices pertaining to workplace safety.

All employees and contractors are required to comply with established safety policies, standards and procedures.

As the COVID-19 pandemic persists, our focus remains on promoting employee health and safety and ensuring business continuity.

Throughout the COVID-19 pandemic, our focus has remained on promoting employee health and safety and ensuring business continuity.

Beginning in March 2020, our employees were instructed to work from home.

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For our healthcare-related facilities operated pursuant to a RIDEA structure, which include our SHOP and integrated senior health campuses, we rely on each management company to attract and retain skilled personnel to provide services at our healthcare-related facilities.

As a result of the COVID-19 pandemic, such management companies have put into place a number of health and safety measures to enable their employees to continue to work in our healthcare-related facilities, including the procurement and distribution of personal protective equipment and the implementation of daily employee and resident health screenings, vaccination clinics for employees and residents, as well as aggressive safety protocols in accordance with the Centers for Disease Control and Prevention, or CDC, Centers for Medicare and Medicaid Services, or CMS, and local health agency guidelines to limit the exposure and spread of COVID-19.

As a result of the COVID-19 pandemic, such management companies have put into place a number of health and safety measures to enable their employees to continue to work in our healthcare-related facilities, including the procurement and distribution of personal protective equipment, and the implementation of daily employee and resident health screenings, vaccination clinics for employees and residents as well as aggressive safety protocols in accordance with the Centers for Disease Control and Prevention and Centers for Medicare and Medicaid Services, or CMS, and local health agency guidelines to limit the exposure and spread of COVID-19.

While the health and safety measures instituted by each management company have allowed facilities to operate during the pandemic, these facilities may face challenges created by workforce shortages and absenteeism due to COVID-19.

W e believe maintaining a rigorous corporate governance framework is essential to the success of our organization, and we seek to adhere to policies and procedures that ensure transparency, accountability, oversight, and risk minimization.

This includes committees of our board, comprised solely of independent directors, which oversee a wide range of matters such as financial reporting, executive compensation, ESG policies and conflict of interest related matters.

We have structured our corporate governance in a manner we believe closely aligns our interests with those of our stockholders.

Notable features of our corporate governance structure include the following:

• our board is not classified and each of our directors is subject to election annually;

• we have fully independent audit, compensation and nominating and corporate governance committees;

• at least one of our directors qualifies as an “audit committee financial expert” under applicable SEC regulations and all members of the Audit Committee are financially literate in accordance with the NYSE listing rules and requirements;

• our board has opted out of the business combination statute in the MGCL (provided that such business combination is first approved by our board) and, pursuant to our bylaws, we have opted out of the control share acquisition statute in the MGCL;

• we do not have a stockholder rights plan, and do not intend to adopt a stockholder rights plan in the future without (i) the approval of our stockholders or (ii) seeking ratification from our stockholders within 12 months of adoption of the plan if our board determines, in the exercise of the directors’ duties under applicable law, that it is in our best interests to adopt a rights plan without the delay of seeking prior stockholder approval;

• our Corporate Governance Guidelines adopted by our board require our directors and officers to own certain minimum amounts of our common stock.

We also adhere to what we believe to be industry leading policies to ensure our management and employees are acting in a manner which protects the best interest of our stakeholders.

This includes our Code of Business Conduct and Ethics, Whistleblower Policy, Insider Trading Policy, Corporate Governance Guidelines, Regulation FD and Disclosure Policy and Related Party Transactions Policy.

Investment Company Act Considerations

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however, our portfolio does include, to a much lesser extent, other real estate-related investments.

We have also acquired, and may continue to acquire, real

estate assets through investments in joint venture entities, including joint venture entities in which we may not own a controlling interest.

We have also acquired, and may continue to acquire, real estate assets through investments in joint venture entities, including joint venture entities in which we may not own a controlling interest.

We anticipate that our assets generally will be held in wholly and majority-owned subsidiaries of the company, each formed to hold a particular asset.

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We segregate our operations into reporting segments in order to assess the performance of our business in the same way that management reviews our performance and makes operating decisions.

As of December 31, 2021, we operated through six reportable business segments — medical office buildings, integrated senior health campuses, skilled nursing facilities, SHOP, senior housing and hospitals.

Medical Office Buildings.

As of December 31, 2021, we owned 105 medical office buildings, or MOBs.

These properties typically contain physicians’ offices and examination rooms and may also include pharmacies, hospital ancillary service space and outpatient services such as diagnostic centers, rehabilitation clinics and day-surgery operating rooms.

While these properties are similar to commercial office buildings, they require additional parking spaces as well as plumbing, electrical and mechanical systems to accommodate multiple exam rooms that may require sinks in every room and special equipment such as x-ray machines.

In addition, MOBs are often built to accommodate higher structural loads for certain equipment and may contain other specialized construction.

Our MOBs are typically multi-tenant properties leased to healthcare providers (hospitals and physician practices) for approximately three to 10 years with fixed annual escalations.

Skilled Nursing Facilities.

As of December 31, 2021, we owned 17 skilled nursing facilities, or SNFs.

Skilled nursing facility residents are generally higher acuity and need assistance with eating, bathing, dressing, and/or require assistance with medication and also require available 24-hour nursing care.

SNFs offer restorative, rehabilitative and custodial nursing care for people not requiring the more extensive and sophisticated treatment available at hospitals.

Ancillary revenues and revenues from sub-acute care services are derived from providing services to residents beyond room and board and include occupational, physical, speech, respiratory and intravenous therapy, wound care, oncology treatment, brain injury care, orthopedic therapy and other services.

Certain SNFs provide some of the foregoing services on an out-patient basis.

Skilled nursing services provided by our tenants in these SNFs are primarily paid for either by private sources or through the Medicare and Medicaid programs.

Our SNFs are leased to a single tenant under a triple-net lease structure with approximately 12 to 15 year terms and fixed annual rent escalations.

Senior Housing.

As of December 31, 2021, we owned 20 senior housing facilities.

Senior housing facilities cater to different segments of the elderly population based upon their personal needs, and include assisted living, memory care, and independent living.

Residents of assisted living facilities typically require limited medical care and need assistance with eating, bathing, dressing, and/or medication management and those services can be provided by staff at the facility.

Resident programs offered at such facilities may include transportation, social activities and exercise and fitness programs.

Services provided by our tenants in these facilities are primarily paid for by the residents directly or through private insurance and are less reliant on government reimbursement programs such as Medicaid and Medicare.

Our senior housing facilities are leased to single tenants under triple-net lease structures, whereby the tenant is responsible for making rent payments, maintaining the properties and paying taxes and other expenses.

Leases are typically 12 to 15 years with annual escalations and required lease coverage ratios.

As of December 31, 2021, we owned and operated 47 senior housing facilities utilizing a RIDEA structure.

Such facilities are of a similar property type as our senior housing segment discussed above;

however, we have entered into agreements with healthcare operators to manage the facilities on our behalf utilizing a RIDEA structure.

The healthcare operators we engage provide management and operational services at the facilities, and we retain the net earnings generated by the performance of each of the facilities after payment of the management fee and other operational and maintenance expenses.

As a result, under a RIDEA structure we retain the upside from improved operational performance, and similarly the risk of any decline in performance.

Substantially all of our leases with residents in the senior housing facilities are for a term of one year or less.

As of December 31, 2022, we operated through six reportable business segments — integrated senior health campuses, MOBs, SNFs, SHOP, senior housing — leased and hospitals.

Integrated Senior Health Campuses

As of December 31, 2021, we owned and/or operated 122 integrated senior health campuses, predominantly all of which are operated utilizing a RIDEA structure.

Integrated senior health campuses include a range of senior care, including assisted living, memory care, independent living, skilled nursing services and certain ancillary businesses.

Services provided in these facilities are primarily paid for by the residents directly or through private insurance and are less reliant on government reimbursement programs such as Medicaid and Medicare.

As of December 31, 2021, we owned two hospital buildings.

Services provided by our operators and tenants in our hospitals are paid for by private sources, third-party payors (e.g., insurance and Health Maintenance Organizations), or through the Medicare and Medicaid programs.

We expect that our hospital properties typically will include acute care, long-term acute care, specialty and rehabilitation hospitals and generally will be leased to single tenants or operators under triple-net lease structures.

As of December 31, 2022, we owned and/or operated 120 integrated senior health campuses.

These facilities allow residents to “age-in-place” by providing independent living, assisted living, memory care, skilled nursing and certain ancillary services, all within a single campus setting.

Integrated senior health campuses predominantly focus on needs-driven segments of senior care (i.e., assisted living, memory care and skilled nursing) and charge market rents in lieu of entry fees, as is commonly the case with continuing care retirement communities.

Nearly all of our integrated senior health campuses are operated utilizing a RIDEA structure, allowing us to participate in the upside from any improved operational performance and bear the risk of any decline in operating performance.

Integrated senior health campuses are a valuable component of our portfolio because of their ability to provide a continuum of care as residents require increasing levels of care.

As of December 31, 2022, we owned 104 MOBs that we lease to third parties.

These properties are similar to commercial office buildings, but typically require specialized infrastructure to accommodate a medical use (e.g., physicians’ offices and examination rooms, as well as some ancillary uses, including pharmacies, hospital ancillary service space and outpatient services, such as diagnostic centers, rehabilitation clinics and outpatient-surgery operating rooms).

Our MOBs are typically multi-tenant properties leased to healthcare providers (hospitals and physician practices) under leases that generally provide for recovery of certain operating expenses and certain capital expenditures and have initial terms of five to 10 years with fixed annual rent escalations.

We value the stable and reliable cash flows our MOBs provide our company, which we believe are particularly valuable during market disruptions and recessionary periods.

As of December 31, 2022, we owned 17 SNFs that we lease to third parties.

SNF residents are generally higher acuity and need assistance with eating, bathing, dressing and/or medication management and also require available 24-hour nursing

SNFs offer restorative, rehabilitative and custodial nursing care for people who cannot live independently but do not require the more extensive and sophisticated treatment available at hospitals.

Skilled nursing services provided by our tenants in SNFs are paid for either by private sources or through the Medicare and Medicaid programs.

Our SNFs are leased to a single tenant under a triple-net lease, typically with 12 to 15 year initial terms, fixed annual rent escalations and require minimum lease coverage ratios.

We commonly structure SNFs under a master lease with multiple facilities in order to diversify our master tenant’s sources of rent and mitigate risk.

We typically focus on SNF investments in states that require a CON in order to develop new SNFs, which we believe reduces the risk of over-supply.

As of December 31, 2022, we owned and operated 51 senior housing facilities in our SHOP segment.

Senior housing facilities cater to different segments of the elderly population based upon their personal needs and include independent living, assisted living and memory care facilities.

Residents of assisted living facilities typically require limited medical care but need assistance with eating, bathing, dressing and/or medication management.

Services provided by operators at these facilities are primarily paid for by the residents directly or through private insurance and are therefore less reliant on government reimbursement programs, such as Medicaid and Medicare.

The facilities in our SHOP segment are operated utilizing RIDEA structures, allowing us to participate in the upside from any improved operational performance but requiring us to bear the risk of any decline in operating performance.

Our SHOP segment has the potential for embedded growth through the ongoing recovery from the COVID-19 pandemic and demand growth from an aging U.S.

Senior Housing — Leased

As of December 31, 2022, we owned 20 senior housing facilities that we lease to third parties within our senior housing — leased segment.

The facilities are leased to a single tenant under a triple-net lease structure with approximately 12 to 15 year initial terms and fixed annual rent escalations and require minimum lease coverage ratios.

We commonly structure senior housing — leased assets under a single master lease covering multiple facilities in order to diversify our master tenant’s sources of rent and mitigate risk.

As of December 31, 2022, we have one wholly-owned hospital and one hospital in which we own an approximately 90.6% interest.

Services provided by operators and tenants in our hospitals are paid for by private sources, third-party payors (e.g., insurance and health maintenance organizations) or through the Medicare and Medicaid programs.

Our hospital properties include acute care, long-term acute care, specialty and rehabilitation services and are leased to single tenants or operators under triple-net lease structures.

For a further discussion of our segment reporting for the years ended December 31, 2022, 2021 and 2020, see Item 2, Properties, Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, and Note 19, Segment Reporting, to the Consolidated Financial Statements that are a part of this Annual Report on Form 10-K.

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What changed 10-K

Item 1. Business