What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-08-14 compared with 2023-05-15 · 494 added, 275 removed, 720 unchanged (52% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

As of March 31, 2023 and December 31, 2022

As of June 30, 2023 and December 31, 2022

(In thousands, except share and per share amounts) (Unaudited)

2023 December 31,

26 unchanged sentences

200,000,000 shares authorized;

19,536,622 and 19,535,095 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

194,000 194,000

19,562,539 and 19,535,095 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

Class I common stock, $ 0.01 par value per share;

800,000,000 shares authorized;

46,673,686 and 46,675,367 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

467,000 467,000

46,673,320 and 46,675,367 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

Additional paid-in capital 2,547,135 2,540,424

7 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS — (Continued)

As of March 31, 2023 and December 31, 2022

As of June 30, 2023 and December 31, 2022

(In thousands) (Unaudited)

(1) Such liabilities of American Healthcare REIT, Inc.

represented liabilities of American Healthcare REIT Holdings, LP or its consolidated subsidiaries as of March 31, 2023 and December 31, 2022.

represented liabilities of American Healthcare REIT Holdings, LP or its consolidated subsidiaries as of June 30, 2023 and December 31, 2022.

American Healthcare REIT Holdings, LP is a variable interest entity, or VIE, and a consolidated subsidiary of American Healthcare REIT, Inc.

The creditors of American Healthcare REIT Holdings, LP or its consolidated subsidiaries do not have recourse against American Healthcare REIT, Inc., except for the 2022 Credit Facility, as defined in Note 8, held by American Healthcare REIT Holdings, LP in the amount of $ 977,900,000 and $ 965,900,000 as of March 31, 2023 and December 31, 2022, respectively, which was guaranteed by American Healthcare REIT, Inc.

The creditors of American Healthcare REIT Holdings, LP or its consolidated subsidiaries do not have recourse against American Healthcare REIT, Inc., except for the 2022 Credit Facility, as defined in Note 8, held by American Healthcare REIT Holdings, LP in the amount of $ 926,400 and $ 965,900 as of June 30, 2023 and December 31, 2022, respectively, which was guaranteed by American Healthcare REIT, Inc.

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the Three Months Ended March 31, 2023 and 2022

Three Months Ended March 31,

For the Three and Six Months Ended June 30, 2023 and 2022

(In thousands, except share and per share amounts) (Unaudited)

Three Months Ended June 30,

Six Months Ended June 30,

2023 2022 2023 2022

Revenues and grant income:

11 unchanged sentences

Interest expense:

Interest expense (including amortization of deferred financing costs, debt discount/premium and loss on debt extinguishments) ( 39,011,000 ) ( 23,325,000 )

(Loss) gain in fair value of derivative financial instruments ( 195,000 ) 500,000

Interest expense (including amortization of deferred financing costs, debt discount/premium and gain/loss on debt extinguishments) ( 40,990 ) ( 20,345 ) ( 80,001 ) ( 43,670 )

Gain in fair value of derivative financial instruments 4,993 — 4,798 500

(Loss) gain on dispositions of real estate investments ( 2,072 ) ( 73 ) ( 2,204 ) 683

Impairment of real estate investments — ( 17,340 ) — ( 17,340 )

(Loss) income from unconsolidated entities ( 113 ) 638 ( 419 ) 2,024

6 unchanged sentences

( 11,867 ) ( 15,542 ) ( 39,482 ) ( 16,439 )

Net loss (income) attributable to noncontrolling interests 1,743,000 ( 2,059,000 )

Net (income) loss attributable to noncontrolling interests ( 316 ) ( 1,768 ) 1,427 ( 3,827 )

Net loss attributable to controlling interest $ ( 12,183 ) $ ( 17,310 ) $ ( 38,055 ) $ ( 20,266 )

6 unchanged sentences

Comprehensive loss ( 11,743 ) ( 16,035 ) ( 39,236 ) ( 17,126 )

Comprehensive loss (income) attributable to noncontrolling interests 1,743,000 ( 2,059,000 )

Comprehensive (income) loss attributable to noncontrolling interests ( 316 ) ( 1,768 ) 1,427 ( 3,827 )

Comprehensive loss attributable to controlling interest $ ( 12,059 ) $ ( 17,803 ) $ ( 37,809 ) $ ( 20,953 )

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

For the Three Months Ended March 31, 2023 and 2022

Three Months Ended March 31, 2023

For the Three and Six Months Ended June 30, 2023 and 2022

(In thousands, except share and per share amounts) (Unaudited)

Three Months Ended June 30, 2023

Stockholders’ Equity

7 unchanged sentences

Interests Total Equity

BALANCE — March 31, 2023

66,210,308 $ 661 $ 2,546,299 $ ( 1,180,741 ) $ ( 2,568 ) $ 1,363,651 $ 163,338 $ 1,526,989

Issuance of nonvested restricted common stock 24,200 — — — — — — —

Vested restricted stock units(1) 4,120 — ( 72 ) — — ( 72 ) — ( 72 )

Amortization of nonvested restricted common stock and stock units — — 1,564 — — 1,564 — 1,564

Stock based compensation — — — — — — 20 20

Repurchase of common stock ( 2,769 ) — ( 87 ) — — ( 87 ) — ( 87 )

Distributions to noncontrolling interests — — — — — — ( 3,092 ) ( 3,092 )

Reclassification of noncontrolling interests to mezzanine equity — — — — — — ( 20 ) ( 20 )

Adjustment to value of redeemable noncontrolling interests — — ( 569 ) — — ( 569 ) ( 52 ) ( 621 )

Distributions declared ($ 0.25 per share)

— — — ( 16,654 ) — ( 16,654 ) — ( 16,654 )

Net (loss) income — — — ( 12,183 ) — ( 12,183 ) 434 ( 11,749 ) (2)

Other comprehensive income — — — — 124 124 — 124

BALANCE — June 30, 2023

66,235,859 $ 661 $ 2,547,135 $ ( 1,209,578 ) $ ( 2,444 ) $ 1,335,774 $ 160,628 $ 1,496,402

AMERICAN HEALTHCARE REIT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY — (Continued)

For the Three and Six Months Ended June 30, 2023 and 2022

(In thousands, except share and per share amounts) (Unaudited)

Three Months Ended June 30, 2022

Stockholders’ Equity

Class T and Class I

Shares Amount Additional

Capital Accumulated

Deficit Accumulated

Comprehensive

Stockholders’

Equity Noncontrolling

Interests Total Equity

BALANCE — March 31, 2022 65,952,428 $ 660 $ 2,538,780 $ ( 980,613 ) $ ( 2,160 ) $ 1,556,667 $ 174,154 $ 1,730,821

Offering costs — common stock — — 1 — — 1 — 1

Issuance of common stock under the DRIP 299,857 3 11,140 — — 11,143 — 11,143

Issuance of nonvested restricted common stock 13,725 — — — — — — —

Amortization of nonvested restricted common stock and stock units — — 980 — — 980 — 980

Stock based compensation — — — — — — 21 21

Repurchase of common stock ( 174,865 ) ( 2 ) ( 6,447 ) — — ( 6,449 ) — ( 6,449 )

Distributions to noncontrolling interests — — — — — — ( 3,537 ) ( 3,537 )

Reclassification of noncontrolling interests to mezzanine equity — — — — — — ( 21 ) ( 21 )

Adjustment to value of redeemable noncontrolling interests — — ( 976 ) — — ( 976 ) ( 1 ) ( 977 )

Distributions declared ($ 0.40 per share)

— — — ( 26,405 ) — ( 26,405 ) — ( 26,405 )

Net (loss) income — — — ( 17,310 ) — ( 17,310 ) 1,986 ( 15,324 ) (2)

Other comprehensive loss — — — — ( 493 ) ( 493 ) — ( 493 )

BALANCE — June 30, 2022 66,091,145 $ 661 $ 2,543,478 $ ( 1,024,328 ) $ ( 2,653 ) $ 1,517,158 $ 172,602 $ 1,689,760

AMERICAN HEALTHCARE REIT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY — (Continued)

For the Three and Six Months Ended June 30, 2023 and 2022

(In thousands, except share and per share amounts) (Unaudited)

Six Months Ended June 30, 2023

Stockholders’ Equity

Class T and Class I

Shares Amount Additional

Capital Accumulated

Deficit Accumulated

Comprehensive

Stockholders’

Equity Noncontrolling

Interests Total Equity

BALANCE — December 31, 2022

1 unchanged sentence

Issuance of nonvested restricted common stock 26,156 — — — — — — —

Vested restricted stock units(1) 4,120 — ( 72 ) — — ( 72 ) — ( 72 )

Amortization of nonvested restricted common stock and stock units — — 2,615 — — 2,615 — 2,615

8 unchanged sentences

Other comprehensive income — — — — 246 246 — 246

BALANCE — March 31, 2023

BALANCE — June 30, 2023

66,235,859 $ 661 $ 2,547,135 $ ( 1,209,578 ) $ ( 2,444 ) $ 1,335,774 $ 160,628 $ 1,496,402

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY — (Continued)

For the Three Months Ended March 31, 2023 and 2022

Three Months Ended March 31, 2022

For the Three and Six Months Ended June 30, 2023 and 2022

(In thousands, except share and per share amounts) (Unaudited)

Six Months Ended June 30, 2022

Stockholders’ Equity

12 unchanged sentences

606,375 6 22,441 — — 22,447 — 22,447

Amortization of nonvested restricted common stock — — 811,000 — — 811,000 — 811,000

Issuance of nonvested restricted common stock 13,725 — — — — — — —

Amortization of nonvested restricted common stock and stock units — — 1,791 — — 1,791 — 1,791

Stock based compensation — — — — — — 42 42

10 unchanged sentences

Other comprehensive loss — — — — ( 687 ) ( 687 ) — ( 687 )

BALANCE — March 31, 2022

BALANCE — June 30, 2022

66,091,145 $ 661 $ 2,543,478 $ ( 1,024,328 ) $ ( 2,653 ) $ 1,517,158 $ 172,602 $ 1,689,760

(1) For the three months ended March 31, 2023 and 2022, amounts exclude $( 368,000 ) and $ 187,000 , respectively, of net (loss) income attributable to redeemable noncontrolling interests.

See Note 12, Redeemable Noncontrolling Interests, for a further discussion.

(1) The amounts are shown net of common stock withheld from issuance to satisfy employee minimum tax withholding requirements in connection with the vesting of restricted stock units.

See Note 12, Equity — AHR 2015 Incentive Plan, for further discussion.

(2) For the three months ended June 30, 2023 and 2022, amounts exclude $( 118 ) and $( 218 ), respectively, of net loss attributable to redeemable noncontrolling interests.

For the six months ended June 30, 2023 and 2022, amounts exclude $( 486 ) and $( 31 ), respectively, of net loss attributable to redeemable noncontrolling interests.

See Note 11, Redeemable Noncontrolling Interests, for further discussion.

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months Ended March 31, 2023 and 2022

Three Months Ended March 31,

For the Six Months Ended June 30, 2023 and 2022

(In thousands) (Unaudited)

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES

5 unchanged sentences

Stock based compensation 2,656 1,779

Impairment of real estate investments — 17,340

Loss (gain) on dispositions of real estate investments 2,204 ( 683 )

13 unchanged sentences

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from dispositions of real estate investments 87,446 14,002

Developments and capital expenditures ( 52,074 ) ( 35,508 )

1 unchanged sentence

Acquisition of previously held equity interest ( 335 ) —

Proceeds from dispositions of real estate investments 6,901,000 14,074,000

Investments in unconsolidated entities ( 12,000 ) ( 200 )

Real estate and other deposits ( 1,017 ) ( 533 )

Net cash used in investing activities ( 33,319,000 ) ( 27,367,000 )

Net cash provided by (used in) investing activities 9,687 ( 97,364 )

CASH FLOWS FROM FINANCING ACTIVITIES

5 unchanged sentences

Debt extinguishment costs — ( 2,790 )

Payments on financing obligations ( 733,000 ) ( 787,000 )

Payments on financing and other obligations ( 7,779 ) ( 12,141 )

Distributions paid to common stockholders ( 43,086 ) ( 30,247 )

Repurchase of common stock ( 165 ) ( 10,583 )

Payments to taxing authorities in connection with common stock directly withheld from employees ( 72 ) —

Distributions to noncontrolling interests in total equity ( 6,612 ) ( 7,052 )

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS — (Continued)

For the Three Months Ended March 31, 2023 and 2022

Three Months Ended March 31,

For the Six Months Ended June 30, 2023 and 2022

(In thousands) (Unaudited)

Six Months Ended June 30,

Contribution from redeemable noncontrolling interest $ — $ 173

Distributions to redeemable noncontrolling interests ( 1,012 ) ( 1,405 )

Repurchase of redeemable noncontrolling interest ( 15,803,000 ) —

Repurchase of redeemable noncontrolling interests ( 15,954 ) —

Payment of offering costs ( 781 ) ( 9 )

Security deposits ( 61 ) ( 455 )

Net cash used in financing activities ( 14,300,000 ) ( 1,307,000 )

Net cash (used in) provided by financing activities ( 71,575 ) 19,924

NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH $ ( 18,246 ) $ ( 21,302 )

25 unchanged sentences

Accounts and other receivables $ ( 1,733 ) $ ( 262 )

Other assets $ 162,000 $ 5,023,000

Other assets, net $ ( 920 ) $ 5,480

Mortgage loan payable, net $ — $ ( 12,059 )

1 unchanged sentence

Financing obligations $ 12 $ 56

Security deposits and other liabilities $ 312,000 $ 7,746,000

Security deposits, prepaid rent and other liabilities $ 28 $ 8,129

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the Three Months Ended March 31, 2023 and 2022

For the Three and Six Months Ended June 30, 2023 and 2022

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

2 unchanged sentences

Overview and Background

American Healthcare REIT, Inc., a Maryland corporation, is a self-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 facilities, skilled nursing facilities, or SNFs, hospitals and other healthcare-related facilities.

American Healthcare REIT, Inc., a Maryland corporation, is a self-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 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).

7 unchanged sentences

On October 1, 2021, Griffin-American Healthcare REIT III, Inc., or GAHR III, merged with and into a wholly owned subsidiary, or Merger Sub, of Griffin-American Healthcare REIT IV, Inc., or GAHR IV, with Merger Sub being the surviving company, which we refer to as the REIT Merger, and our operating partnership, Griffin-American Healthcare REIT IV Holdings, LP, merged with and into Griffin-American Healthcare REIT III Holdings, LP, or the Surviving Partnership, with the Surviving Partnership being the surviving entity, which we refer to as the Partnership Merger and, together with the REIT Merger, the Merger.

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

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

and the Surviving Partnership was renamed American Healthcare REIT Holdings, LP, or our operating partnership.

3 unchanged sentences

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

As of both March 31, 2023 and December 31, 2022 , we owned 95.0 % of the partnership units, or OP units, in our operating partnership, and the remaining 5.0 % limited OP units, were owned by AHI Group Holdings, LLC, which is owned and controlled by Jeffrey T.

As of both June 30, 2023 and December 31, 2022 , we owned 95.0 % of the partnership units, or OP units, in our operating partnership, and the remaining 5.0 % limited OP units, were owned by AHI Group Holdings, LLC, which is owned and controlled by Jeffrey T.

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;

Streiff, one of our directors;

Platform Healthcare Investor TII, LLC;

3 unchanged sentences

Public Offerings

As of March 31, 2023, after taking into consideration the impact of the Merger and the reverse stock split as discussed in Note 2, Summary of Significant Accounting Policies, we had issued 65,445,557 shares for a total of $ 2,737,716,000 of common stock since February 26, 2014 in our initial public offerings and our distribution reinvestment plan, or DRIP, offerings (includes historical offering amounts sold by GAHR III and GAHR IV prior to the Merger).

As of June 30, 2023, after taking into consideration the impact of the Merger and the reverse stock split as discussed in Note 2, Summary of Significant Accounting Policies, we had issued 65,445,557 shares for a total of $ 2,737,716,000 of common stock since February 26, 2014 in our initial public offerings and our distribution reinvestment plan, or DRIP, offerings (includes historical offering amounts sold by GAHR III and GAHR IV prior to the Merger).

On September 16, 2022, we filed with the United States Securities and Exchange Commission, or the 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 the Proposed Listing.

333-267464), and on July 14, 2023, we filed with the SEC Amendment No.

1 to Registration Statement on Form S-11, 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 the Proposed Listing.

Such registration statement and contemplated listing are not yet effective.

4 unchanged sentences

We currently operate through six reportable business segments:

integrated senior health campuses, MOBs, SHOP, SNFs, senior housing — leased and hospitals.

As of March 31, 2023, we owned and/or operated 314 buildings and integrated senior health campuses, including completed development and expansion projects, or approximately 19,956,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $ 4,626,119,000 .

In addition, as of March 31, 2023, we also owned a real estate-related debt investment purchased for $ 60,429,000 .

integrated senior health campuses, MOBs, SNFs, SHOP, senior housing — leased and hospitals.

As of June 30, 2023, we owned and/or operated 300 buildings and integrated senior health campuses, including completed development and expansion projects, representing approximately 19,142,000 square feet of gross leasable area, or GLA, for an aggregate contract purchase price of $ 4,517,298,000 .

In addition, as of June 30, 2023, we also owned a real estate-related debt investment purchased for $ 60,429,000 .

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

economy have been adversely affected by the impact of the COVID-19 pandemic.

While the COVID-19 pandemic has subsided from its peaks, the timing and extent of the economic recovery from the COVID-19 pandemic is dependent upon many factors, including the emergence and severity of new COVID-19 variants, the effectiveness of vaccines, the actions taken to contain the pandemic or mitigate its impact and the direct and indirect economic effects of the pandemic and containment measures, the overall pace of recovery, among others.

As the lasting economic effects of the responses to the COVID-19 pandemic, such as inflation and labor market challenges, are still impacting the healthcare system to a certain extent, such effects continue 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 such economic 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 March 31, 2023.

economy have been adversely affected by the impact of the COVID-19 pandemic and the economic impact of the pandemic.

While the immediate effects of the COVID-19 pandemic have subsided, the timing and extent of the economic recovery towards pre-pandemic norms is dependent upon many factors, including the emergence and severity of future COVID-19 variants, the effectiveness and frequency of booster vaccinations, the duration and implications of ongoing or future restrictions and safety measures, the availability of ongoing government financial support to our tenants, operating partners and managers and the overall pace of economic recovery, among others.

As an owner and operator of healthcare facilities, we expect to continue to be adversely affected by the long-term effects of the COVID-19 pandemic for some period of time;

however, it is not possible to predict the full extent of its future impact on us, the operations of our properties or the markets in which they are located, or the overall healthcare industry.

We will continue to monitor such impacts and will adjust our estimates and assumptions based on the best available information.

10 unchanged sentences

We operate and intend to continue to operate in an umbrella partnership REIT structure in which our operating partnership, or wholly owned subsidiaries of our operating partnership and all non-wholly owned subsidiaries of which we have control, will own substantially all of the interests in properties acquired on our behalf.

We are the sole general partner of our operating partnership and as of both March 31, 2023 and December 31, 2022, we owned a 95.0 % general partnership interest therein, and the remaining 5.0 % was owned by the NewCo Sellers.

We are the sole general partner of our operating partnership and as of both June 30, 2023 and December 31, 2022, we owned a 95.0 % general partnership interest therein, and the remaining 5.0 % limited partnership interest was owned by the NewCo Sellers.

AMERICAN HEALTHCARE REIT, INC.

16 unchanged sentences

Actual results could differ from those estimates, perhaps in material adverse ways, and those estimates could be different under different assumptions or conditions.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Revenue Recognition — Resident Fees and Services Revenue

Disaggregation of Resident Fees and Services Revenue

The following tables disaggregate our resident fees and services revenue by line of business, according to whether such revenue is recognized at a point in time or over time:

Three Months Ended March 31,

The following tables disaggregate our resident fees and services revenue by line of business, according to whether such revenue is recognized at a point in time or over time (in thousands):

Three Months Ended June 30,

Senior Health

6 unchanged sentences

$ 362,856 $ 47,766 $ 410,622 $ 287,582 $ 38,643 $ 326,225

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

The following tables disaggregate our resident fees and services revenue by payor class:

Three Months Ended March 31,

Six Months Ended June 30,

Senior Health

2 unchanged sentences

Campuses SHOP(1) Total

Over time $ 597,479 $ 92,212 $ 689,691 $ 463,373 $ 75,107 $ 538,480

Point in time 127,147 2,414 129,561 105,221 1,498 106,719

Total resident fees and services

$ 724,626 $ 94,626 $ 819,252 $ 568,594 $ 76,605 $ 645,199

The following tables disaggregate our resident fees and services revenue by payor class (in thousands):

Three Months Ended June 30,

Senior Health

Campuses SHOP(1) Total Integrated

Senior Health

Campuses SHOP(1) Total

Private and other payors

4 unchanged sentences

$ 362,856 $ 47,766 $ 410,622 $ 287,582 $ 38,643 $ 326,225

(1) Includes fees for basic housing and assisted living care.

Six Months Ended June 30,

Senior Health

Campuses SHOP(1) Total Integrated

Senior Health

Campuses SHOP(1) Total

Private and other payors

$ 334,831 $ 88,846 $ 423,677 $ 269,222 $ 70,669 $ 339,891

244,466 311 244,777 188,197 — 188,197

145,329 5,469 150,798 111,175 5,936 117,111

Total resident fees and services

$ 724,626 $ 94,626 $ 819,252 $ 568,594 $ 76,605 $ 645,199

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

(1) Includes fees for basic housing, as well as fees for assisted living or skilled nursing care.

We record revenue when services are rendered at amounts billable to individual residents.

2 unchanged sentences

Accounts Receivable, Net — Resident Fees and Services Revenue

The beginning and ending balances of accounts receivable, net — resident fees and services are as follows:

The beginning and ending balances of accounts receivable, net — resident fees and services are as follows (in thousands):

Other Payors Medicare Medicaid Total

1 unchanged sentence

$ 55,484 $ 45,669 $ 20,832 $ 121,985

Ending balance — March 31, 2023

Ending balance — June 30, 2023

58,199 45,477 18,708 122,384

2 unchanged sentences

Deferred revenue is included in security deposits, prepaid rent and other liabilities in our accompanying condensed consolidated balance sheets.

The beginning and ending balances of deferred revenue — resident fees and services, almost all of which relates to private and other payors, are as follows:

The beginning and ending balances of deferred revenue — resident fees and services, almost all of which relates to private and other payors, are as follows (in thousands):

Beginning balance — January 1, 2023

Ending balance — March 31, 2023

Ending balance — June 30, 2023

Increase $ 4,331

5 unchanged sentences

Tenant receivables, which are related to real estate revenue, and unbilled deferred rent receivables are reduced for amounts where collectability is not probable, which are recognized as direct reductions of real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

As of March 31, 2023 and December 31, 2022, we had $ 14,391,000 and $ 14,071,000 , respectively, in allowances, which were determined necessary to reduce receivables by our expected future credit losses.

For the three months ended March 31, 2023 and 2022, we increased allowances by $ 4,037,000 and $ 5,223,000 , respectively, and reduced allowances for collections or adjustments by $ 1,827,000 and $ 2,099,000 , respectively.

For the three months ended March 31, 2023 and 2022, $ 1,890,000 and $ 1,630,000 , respectively, of our receivables were written off against the related allowances.

As of June 30, 2023 and December 31, 2022, we had $ 15,046,000 and $ 14,071,000 , respectively, in allowances, which were determined necessary to reduce receivables by our expected future credit losses.

For the six months ended June 30, 2023 and 2022, we increased allowances by $ 9,090,000 and $ 9,581,000 , respectively, and reduced allowances for collections or adjustments by $ 3,596,000 and $ 3,643,000 , respectively.

For the six months ended June 30, 2023 and 2022, $ 4,519,000 and $ 3,518,000 , respectively, of our receivables were written off against the related allowances.

Accounts Payable and Accrued Liabilities

As of June 30, 2023 and December 31, 2022, accounts payable and accrued liabilities primarily include insurance reserves of $ 42,307,000 and $ 39,893,000 , respectively, reimbursement of payroll-related costs to the managers of our SHOP and integrated senior health campuses of $ 39,408,000 and $ 38,624,000 , respectively, accrued developments and capital expenditures to unaffiliated third parties of $ 25,664,000 and $ 30,211,000 , respectively, accrued property taxes of $ 25,415,000 and $ 24,926,000 , respectively, and accrued distributions to common stockholders of $ 16,559,000 and $ 26,484,000 , respectively.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Accounts Payable and Accrued Liabilities

As of March 31, 2023 and December 31, 2022, accounts payable and accrued liabilities primarily include insurance reserves of $ 41,602,000 and $ 39,893,000 , respectively, reimbursement of payroll-related costs to the managers of our SHOP and integrated senior health campuses of $ 39,718,000 and $ 38,624,000 , respectively, accrued property taxes of $ 26,168,000 and $ 24,926,000 , respectively, accrued developments and capital expenditures to unaffiliated third parties of $ 26,102,000 and $ 30,211,000 , respectively, and accrued distributions to common stockholders of $ 16,554,000 and $ 26,484,000 , respectively.

Recently Issued Accounting Pronouncement

In July 2023, the Financial Accounting Standards Board, or FASB, issued Accounting Standard Update, or ASU , 2023-03 , Presentation of Financial Statements (Topic 205), Income Statement-Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation-Stock Compensation (Topic 718):

Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No.

120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280-General Revision of Regulation S-X:

Income or Loss Applicable to Common Stock, or ASU 2023-03.

ASU 2023-03 amends the Accounting Standards Codification, or ASC, for SEC updates pursuant to SEC Staff Accounting Bulletin No.

SEC Staff Announcement at the March 24, 2022 Emerging Issues Task Force Meeting;

and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280 - General Revision of Regulation S-X:

Income or Loss Applicable to Common Stock.

These updates were immediately effective and did not have a material impact on our consolidated financial statements and disclosures.

Real Estate Investments, Net and Business Combinations

Our real estate investments, net consisted of the following as of March 31, 2023 and December 31, 2022:

Our real estate investments, net consisted of the following as of June 30, 2023 and December 31, 2022 (in thousands):

Building, improvements and construction in process $ 3,618,097 $ 3,670,361

4 unchanged sentences

$ 3,482,804 $ 3,581,609

Depreciation expense for the three months ended March 31, 2023 and 2022 was $ 35,899,000 and $ 34,422,000 , respectively.

For the three months ended March 31, 2023, we incurred capital expenditures of $ 10,201,000 for our integrated senior health campuses, $ 3,574,000 for our MOBs and $ 1,750,000 for our SHOP.

We did no t incur any capital expenditures for our properties within our hospitals, SNFs and senior housing — leased segments for the three months ended March 31, 2023.

Acquisition of Real Estate Investment

Depreciation expense for the three months ended June 30, 2023 and 2022 was $ 37,139,000 and $ 34,328,000 , respectively, and for the six months ended June 30, 2023 and 2022 was $ 73,038,000 and $ 68,750,000 , respectively.

For the three months ended June 30, 2023, we incurred capital expenditures of $ 18,858,000 for our integrated senior health campuses, $ 7,268,000 for our MOBs, $ 2,179,000 for our SHOP and $ 245,000 for our senior housing — leased.

We did no t incur any capital expenditures for our properties within our hospitals and SNFs segments for the three months ended June 30, 2023.

For the six months ended June 30, 2023, we incurred capital expenditures of $ 29,059,000 for our integrated senior health campuses, $ 10,842,000 for our MOBs, $ 3,929,000 for our SHOP and $ 245,000 for our senior housing — leased.

We did not incur any capital expenditures for our properties within our hospitals and SNFs segments for the six months ended June 30, 2023.

For both the three and six months ended June 30, 2023, we did not recognize impairment charges on real estate investments.

During both the three and six months ended June 30, 2022, we determined that four of our SHOP were impaired and recognized an aggregate impairment charge of $ 17,340,000 , which reduced the total carrying value of such assets to $ 19,325,000 .

The fair value of one SHOP was determined by the sales price from an executed purchase and sale agreement with a third-party buyer, which was considered a Level 2 measurement within the fair value hierarchy.

The fair value of the remaining three SHOP were based on their projected sales prices, which were considered Level 2 measurements within the fair value hierarchy.

We disposed of three of such impaired facilities during the fourth quarter of 2022 and one of such impaired facilities during the first quarter of 2023.

See the “Dispositions of Real Estate Investments” section below.

Acquisitions of Real Estate Investments

On February 15, 2023, we, through a majority-owned subsidiary of Trilogy Investors, LLC, or Trilogy, acquired an integrated senior health campus located in Kentucky for a contract purchase price of $ 11,000,000 , plus immaterial closing costs.

We financed such acquisition with cash on hand and a mortgage loan payable placed on the property at the time of acquisition with a principal balance of $ 7,700,000 .

We accounted for our acquisition of a real estate investment completed during the three months ended March 31, 2023 as an asset acquisition.

The following table summarizes the purchase price of such acquisition based on relative fair values:

On June 30, 2023, we, through a majority-owned subsidiary of Trilogy, acquired a land parcel in Ohio for a contract purchase price of $ 660,000 , plus closing costs, for the future expansion of an existing integrated senior health campus.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

We accounted for our acquisition of land and real estate investment completed during the six months ended June 30, 2023 as asset acquisitions.

The following table summarizes the purchase price of such acquisitions based on their relative fair values (in thousands):

Building and improvements $ 10,139

1 unchanged sentence

Total assets acquired $ 11,714

Disposition of Real Estate Investment

On February 1, 2023, we disposed of one facility within our Central Florida Senior Housing Portfolio within our SHOP segment, for a contract sales price of $ 7,730,000 and recognized a gain on sale of $ 11,000 .

Dispositions of Real Estate Investments

For the six months ended June 30, 2023, we disposed of five SHOP and 11 MOBs.

We recognized a total aggregate net loss on such dispositions of $ 1,975,000 .

The following is a summary of such dispositions (dollars in thousands):

Location Number of

Buildings Type Date

Disposed Contract

Pinellas Park, FL(1) 1 SHOP 02/01/23 $ 7,730

Olympia Fields, IL 1 MOB 04/10/23 3,750

Auburn, CA 1 MOB 04/26/23 7,050

Pottsville, PA 1 MOB 04/26/23 6,000

New London, CT 1 MOB 05/24/23 4,200

Stratford, CT 1 MOB 05/24/23 4,800

Westbrook, CT 1 MOB 05/24/23 7,250

Lakeland, FL(1) 1 SHOP 06/01/23 7,080

Winter Haven, FL(1) 1 SHOP 06/01/23 17,500

Acworth, GA 3 MOB 06/14/23 8,775

Lithonia, GA 1 MOB 06/14/23 3,445

Stockbridge, GA 1 MOB 06/14/23 2,430

Lake Placid, FL(1) 1 SHOP 06/30/23 5,620

Brooksville, FL(1) 1 SHOP 06/30/23 7,800

Total 16 $ 93,430

(1) See Note 11, Redeemable Noncontrolling Interests, for information about the ownership of the Central Florida Senior Housing Portfolio.

Business Combinations

4 unchanged sentences

As a result, we re-measured the fair value of our previously held equity interest in MCP and recognized a gain on re-measurement of $ 726,000 in our accompanying condensed consolidated statements of operations and comprehensive loss.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

On January 3, 2022, we, through a majority-owned subsidiary of Trilogy, acquired an integrated senior health campus in Kentucky from an unaffiliated third party.

1 unchanged sentence

We acquired such property using cash on hand and placed a mortgage loan payable of $ 20,800,000 on the property at the time of acquisition.

The table below summarizes the acquisition date fair values of the assets acquired and liabilities assumed of our business combinations during the three months ended March 31, 2023 and 2022.

Further, on April 1, 2022, we, through a majority-owned subsidiary of Trilogy, acquired a 50.0 % interest in a pharmaceutical business in Florida from an unaffiliated third party and incurred

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

transaction costs of $ 938,000 .

Prior to such pharmaceutical business acquisition, we owned the other 50.0 % interest in such business, which was accounted for as an equity method investment.

Therefore, through March 31, 2022, our 50.0 % interest in the net earnings or losses of such unconsolidated entity was included in income (loss) from unconsolidated entities in our accompanying condensed consolidated statements of operations and comprehensive loss.

Based on quantitative and qualitative considerations, such business combinations were not material to us individually or in the aggregate and therefore, pro forma financial information is not provided.

Any necessary adjustments are finalized within one year from the date of acquisition.

The table below summarizes the acquisition date fair values of the assets acquired and liabilities assumed of our business combinations during the six months ended June 30, 2023 and 2022 (in thousands):

Acquisition 2022

Building and improvements $ — $ 17,273

Goodwill 3,331,000 1,827,000

In-place leases — 3,420

Land — 3,060,000

Goodwill 3,331 2,816

Furniture, fixtures and equipment 39 1,936

Cash and restricted cash 565 971

Certificates of need — 690

Furniture, fixtures and equipment 39,000 1,558,000

Operating lease right-of-use assets — 646

Other assets 66 457

Accounts receivable, net — 427

Total assets acquired 4,001 31,696

1 unchanged sentence

Accounts payable and accrued liabilities ( 1,676 ) ( 1,802 )

Operating lease liabilities — ( 646 )

Financing obligations ( 12 ) ( 56 )

6 unchanged sentences

The debt security is subordinate to all other interests in the mortgage trust and is not guaranteed by a government-sponsored entity.

As of March 31, 2023 and December 31, 2022, the carrying amount of the debt security investment was $ 83,955,000 and $ 83,000,000 , respectively, net of unamortized closing costs of $ 701,000 and $ 767,000 , respectively.

Accretion on the debt security for the three months ended March 31, 2023 and 2022 was $ 1,020,000 and $ 980,000 , respectively, which is recorded as an increase to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

Amortization expense of closing costs for the three months ended March 31, 2023 and 2022 was $ 65,000 and $ 56,000 , respectively, which is recorded as a decrease to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

As of June 30, 2023 and December 31, 2022, the carrying amount of the debt security investment was $ 84,933,000 and $ 83,000,000 , respectively, net of unamortized closing costs of $ 633,000 and $ 767,000 , respectively.

Accretion on the debt security for the three months ended June 30, 2023 and 2022 was $ 1,046,000 and $ 986,000 , respectively, and for the six months ended June 30, 2023 and 2022 was $ 2,066,000 and $ 1,966,000 , respectively, which is recorded as an increase to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

Amortization expense of closing costs for the three months ended June 30, 2023 and 2022 was $ 68,000 and $ 58,000 , respectively, and for the six months ended June 30, 2023 and 2022 was $ 133,000 and $ 114,000 , respectively, which is recorded as a decrease to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

We evaluated credit quality indicators such as the agency ratings and the underlying collateral of such investment in order to determine expected future credit loss.

We did not record a credit loss for the three months ended March 31, 2023 and 2022.

We did not record a credit loss for the three and six months ended June 30, 2023 and 2022.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Identified Intangible Assets, Net

Identified intangible assets, net consisted of the following as of March 31, 2023 and December 31, 2022:

Identified intangible assets, net and identified intangible liabilities, net consisted of the following as of June 30, 2023 and December 31, 2022 (dollars in thousands):

Amortized intangible assets:

In-place leases, net of accumulated amortization of $ 43,513,000 and $ 38,930,000 as of March 31, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 7.1 years and 7.0 years as of March 31, 2023 and December 31, 2022, respectively)

$ 67,684,000 $ 75,580,000

Above-market leases, net of accumulated amortization of $ 6,094,000 and $ 6,360,000 as of March 31, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 8.3 years and 9.0 years as of March 31, 2023 and December 31, 2022, respectively)

In-place leases, net of accumulated amortization of $ 46,451 and $ 38,930 as of June 30, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 7.4 years and 7.0 years as of June 30, 2023 and December 31, 2022, respectively)

$ 59,937 $ 75,580

Customer relationships, net of accumulated amortization of $ 822,000 and $ 785,000 as of March 31, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 13.4 years and 13.7 years as of March 31, 2023 and December 31, 2022, respectively)

Above-market leases, net of accumulated amortization of $ 6,503 and $ 6,360 as of June 30, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 8.2 years and 9.0 years as of June 30, 2023 and December 31, 2022, respectively)

20,238 30,194

Customer relationships, net of accumulated amortization of $ 859 and $ 785 as of June 30, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 13.2 years and 13.7 years as of June 30, 2023 and December 31, 2022, respectively)

Unamortized intangible assets:

1 unchanged sentence

Trade names 30,787 30,787

Total identified intangible assets, net $ 210,636 $ 236,283

Amortized intangible liabilities:

Below-market leases, net of accumulated amortization of $ 3,169 and $ 2,508 as of June 30, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 8.1 years and 8.4 years as of June 30, 2023 and December 31, 2022, respectively)

$ 9,995 $ 10,837

Amortization expense on identified intangible assets for the three months ended March 31, 2023 and 2022 was $ 17,071,000 and $ 8,239,000 , respectively, which included $ 9,083,000 and $ 1,114,000 , respectively, of amortization recorded as a decrease to real estate revenue for above-market leases in our accompanying condensed consolidated statements of operations and comprehensive loss.

Total identified intangible liabilities, net $ 9,995 $ 10,837

Amortization expense on identified intangible assets for the three months ended June 30, 2023 and 2022 was $ 7,711,000 and $ 6,121,000 , respectively, which included $ 859,000 and $ 1,113,000 , respectively, of amortization recorded as a decrease to real estate revenue for above-market leases in our accompanying condensed consolidated statements of operations and comprehensive loss.

Amortization expense on identified intangible assets for the six months ended June 30, 2023 and 2022 was $ 24,782,000 and $ 14,360,000 , respectively, which included $ 9,942,000 and $ 2,227,000 , respectively, of amortization recorded as a decrease to real estate revenue for above-market leases in our accompanying condensed consolidated statements of operations and comprehensive loss.

On March 1, 2023, we transitioned our SNFs within Central Wisconsin Senior Care Portfolio to a RIDEA structure, which resulted in a full amortization of $ 8,073,000 of above-market leases and $ 885,000 of in-place leases.

The aggregate weighted average remaining life of the identified intangible assets was 7.5 years and 7.7 years as of March 31, 2023 and December 31, 2022, respectively.

As of March 31, 2023, estimated amortization expense on the identified intangible assets for the nine months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter was as follows:

Amortization expense on below-market leases for the three months ended June 30, 2023 and 2022 was $ 404,000 and $ 414,000 , respectively, and for the six months ended June 30, 2023 and 2022 was $ 812,000 and $ 1,023,000 , respectively, which is recorded as an increase to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

The aggregate weighted average remaining life of the identified intangible assets was 7.8 years and 7.7 years as of June 30, 2023 and December 31, 2022, respectively.

The aggregate weighted average remaining life of the identified intangible liabilities was 8.1 years and 8.4 years as of June 30, 2023 and December 31, 2022, respectively.

As of June 30, 2023, estimated amortization expense on the identified intangible assets and liabilities for the six months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter was as follows (in thousands):

Amortization Expense

Year Intangible

Assets Intangible

2023 $ 12,461 $ 777

5 unchanged sentences

Total $ 82,156 $ 9,995

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Other Assets, Net

Other assets, net consisted of the following as of March 31, 2023 and December 31, 2022:

Other assets, net consisted of the following as of June 30, 2023 and December 31, 2022 (dollars in thousands):

Deferred rent receivables $ 48,508 $ 46,867

Prepaid expenses, deposits, other assets and deferred tax assets, net 31,121 25,866

Inventory 19,053,000 19,775,000

Lease commissions, net of accumulated amortization of $ 6,636,000 and $ 6,260,000 as of March 31, 2023 and December 31, 2022, respectively

18,384,000 19,217,000

Investments in unconsolidated entities 21,306 9,580

Deferred financing costs, net of accumulated amortization of $ 6,503,000 and $ 5,704,000 as of March 31, 2023 and December 31, 2022, respectively

3,795,000 4,334,000

Lease inducement, net of accumulated amortization of $ 2,281,000 and $ 2,193,000 as of March 31, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 7.7 years and 7.9 years as of March 31, 2023 and December 31, 2022, respectively)

2,719,000 2,807,000

Inventory — finished goods 19,289 19,775

Lease commissions, net of accumulated amortization of $ 6,646 and $ 6,260 as of June 30, 2023 and December 31, 2022, respectively

18,723 19,217

Derivative financial instrument 4,798 —

Deferred financing costs, net of accumulated amortization of $ 7,391 and $ 5,704 as of June 30, 2023 and December 31, 2022, respectively

Lease inducement, net of accumulated amortization of $ 2,368 and $ 2,193 as of June 30, 2023 and December 31, 2022, respectively (with a weighted average remaining life of 7.4 years and 7.9 years as of June 30, 2023 and December 31, 2022, respectively)

Total $ 149,363 $ 128,446

Deferred financing costs included in other assets, net were related to the 2019 Trilogy Credit Facility and the senior unsecured revolving credit facility portion of the 2022 Credit Facility.

See Note 8, Lines of Credit and Term Loan, for a further discussion.

Amortization expense on lease inducement for both the three months ended March 31, 2023 and 2022 was $ 88,000 , which is recorded as a decrease to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

See Note 8, Lines of Credit and Term Loan, for further discussion.

Amortization expense on lease inducement for both the three and six months ended June 30, 2023 and 2022 was $ 88,000 and $ 176,000 , respectively, which is recorded as a decrease to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

Mortgage Loans Payable, Net

As of March 31, 2023 and December 31, 2022, mortgage loans payable were $ 1,257,057,000 ($ 1,233,745,000 , net of discount/premium and deferred financing costs) and $ 1,254,479,000 ($ 1,229,847,000 , net of discount/premium and deferred financing costs), respectively.

As of March 31, 2023, we had 68 fixed-rate mortgage loans payable and 12 variable-rate mortgage loans payable with effective interest rates ranging from 2.21 % to 7.76 % per annum based on interest rates in effect as of March 31, 2023 and a weighted average effective interest rate of 4.46 %.

As of June 30, 2023 and December 31, 2022, mortgage loans payable were $ 1,260,429,000 ($ 1,237,565,000 , net of discount/premium and deferred financing costs) and $ 1,254,479,000 ($ 1,229,847,000 , net of discount/premium and deferred financing costs), respectively.

As of June 30, 2023, we had 71 fixed-rate mortgage loans payable and 12 variable-rate mortgage loans payable with effective interest rates ranging from 2.21 % to 8.01 % per annum based on interest rates in effect as of June 30, 2023 and a weighted average effective interest rate of 4.51 %.

As of December 31, 2022, we had 68 fixed-rate mortgage loans payable and 11 variable-rate mortgage loans payable with effective interest rates ranging from 2.21 % to 7.26 % per annum based on interest rates in effect as of December 31, 2022 and a weighted average effective interest rate of 4.29 %.

We are required by the terms of certain loan documents to meet certain reporting requirements and covenants, such as net worth ratios, fixed charge coverage ratios and leverage ratios.

Mortgage loans payable, net consisted of the following as of March 31, 2023 and December 31, 2022:

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Mortgage loans payable, net consisted of the following as of June 30, 2023 and December 31, 2022 (in thousands):

Total fixed-rate debt $ 929,442 $ 885,892

5 unchanged sentences

Mortgage loans payable, net $ 1,237,565 $ 1,229,847

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

The following table reflects the changes in the carrying amount of mortgage loans payable, net for the three months ended March 31, 2023 and 2022:

Three Months Ended March 31,

The following table reflects the changes in the carrying amount of mortgage loans payable, net for the six months ended June 30, 2023 and 2022 (in thousands):

Six Months Ended June 30,

Beginning balance $ 1,229,847 $ 1,095,594

1 unchanged sentence

Amortization of deferred financing costs

577,000 2,078,000

Amortization of discount/premium on mortgage loans payable, net 632 1,528

3 unchanged sentences

Deferred financing costs

( 142,000 ) ( 333,000 )

Ending balance $ 1,237,565 $ 1,134,059

For the three months ended March 31, 2023, we did not incur any gain or loss on the extinguishment of mortgage loans payable.

For the three months ended March 31, 2022, we incurred an aggregate loss on the extinguishment of mortgage loans payable of $ 1,430,000 , which is recorded as an increase to interest expense in our accompanying condensed consolidated statements of operations and comprehensive loss.

Such loss was primarily related to the write-off of unamortized loan discount related to eight mortgage loans payable that we refinanced on January 1, 2022 that were due to mature in 2044 through 2052.

As of March 31, 2023, the principal payments due on our mortgage loans payable for the nine months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter were as follows:

2023 $ 128,240,000

2024 278,056,000

2025 165,544,000

2026 155,159,000

For the three and six months ended June 30, 2023, we did not incur any gain or loss on the early extinguishment of mortgage loans payable.

For the three and six months ended June 30, 2022, we incurred an aggregate gain (loss) on the early extinguishment of mortgage loans payable of $ 181,000 and $( 1,249,000 ), respectively, which is recorded as an decrease (increase) to interest expense in our accompanying condensed consolidated statements of operations and comprehensive loss.

Such aggregate net loss was primarily related to the write-off of unamortized loan discount related to eight mortgage loans payable that we refinanced on January 1, 2022 that were due to mature in 2044 through 2052.

As of June 30, 2023, the principal payments due on our mortgage loans payable for the six months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter were as follows (in thousands):

2023 $ 24,165

3 unchanged sentences

2022 Credit Facility

On January 19, 2022 , we, through our operating partnership, as borrower, and certain of our subsidiaries, or the subsidiary guarantors, collectively as guarantors, entered into an agreement, or the 2022 Credit Agreement, to amend and restate the credit agreement for our existing credit facility with Bank of America, N.A., or Bank of America, KeyBank National Association, Citizens Bank, National Association, and the lenders named therein.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

restate the credit agreement for our existing credit facility with Bank of America, N.A., or Bank of America, KeyBank National Association, Citizens Bank, National Association, and the lenders named therein.

The 2022 Credit Agreement provides for a credit facility with an aggregate maximum principal amount up to $ 1,050,000,000 , or the 2022 Credit Facility, which consists of a senior unsecured revolving credit facility in the initial aggregate amount of $ 500,000,000 and a senior unsecured term loan facility in the initial aggregate amount of $ 550,000,000 .

4 unchanged sentences

The term loan matures on January 19, 2027, and may not be extended.

The maximum principal amount of the 2022 Credit Facility may be

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

increased by an aggregate incremental amount of $ 700,000,000 , subject to:

The maximum principal amount of the 2022 Credit Facility may be increased by an aggregate incremental amount of $ 700,000,000 , subject to:

(i) the terms of the 2022 Credit Agreement;

8 unchanged sentences

Except as modified by the terms of the First Amendment, the material terms of the 2022 Credit Agreement remain in full force and effect.

As of both March 31, 2023 and December 31, 2022, our aggregate borrowing capacity under the 2022 Credit Facility was $ 1,050,000,000 , excluding the $ 25,000,000 in standby letters of credit described above.

As of March 31, 2023 and December 31, 2022, borrowings outstanding under the 2022 Credit Facility totaled $ 977,900,000 ($ 976,988,000 , net of deferred financing costs related to the senior unsecured term loan facility portion of the 2022 Credit Facility) and $ 965,900,000 ($ 965,060,000 , net of deferred financing costs related to the senior unsecured term loan facility portion of the 2022 Credit Facility), respectively, and the weighted average interest rate on such borrowings outstanding was 6.57 % and 6.07 % per annum, respectively.

As of both June 30, 2023 and December 31, 2022, our aggregate borrowing capacity under the 2022 Credit Facility was $ 1,050,000,000 , excluding the $ 25,000,000 in standby letters of credit described above.

As of June 30, 2023 and December 31, 2022, borrowings outstanding under the 2022 Credit Facility totaled $ 926,400,000 ($ 925,549,000 , net of deferred financing costs related to the senior unsecured term loan facility portion of the 2022 Credit Facility) and $ 965,900,000 ($ 965,060,000 , net of deferred financing costs related to the senior unsecured term loan facility portion of the 2022 Credit Facility), respectively, and the weighted average interest rate on such borrowings outstanding was 6.82 % and 6.07 % per annum, respectively.

In January 2022, in connection with the 2022 Credit Agreement, we incurred an aggregate $ 3,161,000 loss on the extinguishment of a portion of senior unsecured term loan related to former credit facilities.

12 unchanged sentences

The maximum principal amount of the 2019 Trilogy Credit Facility could have been increased by up to $ 140,000,000 , for a total principal amount of $ 500,000,000 , subject to certain conditions.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

On December 20, 2022, we entered into an amendment to the 2019 Trilogy Credit Agreement, or the 2019 Trilogy Credit Amendment.

5 unchanged sentences

The 2019 Trilogy Credit Facility matures on September 5, 2023 and may be extended for one 12 -month period during the term of the 2019 Trilogy Credit Amendment, subject to the satisfaction of certain conditions, including payment of an extension fee.

At our option, the 2019 Trilogy Credit Facility bears interest at per annum rates equal to (a) SOFR, plus 2.75 %

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

for SOFR Rate Loans, as defined in the 2019 Trilogy Credit Amendment, and (b) for Base Rate Loans, as defined in the 2019 Trilogy Credit Amendment, 1.75 % plus the highest of:

(i) the fluctuating rate per annum of interest in effect for such day as established from time to time by KeyBank as its prime rate, (ii) 0.50 % above the Federal Funds Effective Rate, as defined in the 2019 Trilogy Credit Amendment, and (iii) 1.00 % above one-month Adjusted Term SOFR.

As of both March 31, 2023 and December 31, 2022, our aggregate borrowing capacity under the 2019 Trilogy Credit Facility was $ 400,000,000 .

As of March 31, 2023 and December 31, 2022, borrowings outstanding under the 2019 Trilogy Credit Facility totaled $ 336,234,000 and $ 316,734,000 , respectively, and the weighted average interest rate on such borrowings outstanding was 7.61 % and 7.17 % per annum, respectively.

We intend to satisfy the conditions pursuant to the 2019 Trilogy Credit Facility and pay the required extension fee in order to exercise our option to extend the maturity date for one 12 -month period.

At our option, the 2019 Trilogy Credit Facility bears interest at per annum rates equal to (a) SOFR, plus 2.75 % for SOFR Rate Loans and (b) for Base Rate Loans, 1.75 % plus the highest of:

(i) the fluctuating rate per annum of interest in effect for such day as established from time to time by KeyBank as its prime rate, (ii) 0.50 % above the Federal Funds Effective Rate and (iii) 1.00 % above one-month Adjusted Term SOFR.

As of both June 30, 2023 and December 31, 2022, our aggregate borrowing capacity under the 2019 Trilogy Credit Facility was $ 400,000,000 .

As of June 30, 2023 and December 31, 2022, borrowings outstanding under the 2019 Trilogy Credit Facility totaled $ 356,134,000 and $ 316,734,000 , respectively, and the weighted average interest rate on such borrowings outstanding was 7.94 % and 7.17 % per annum, respectively.

Derivative Financial Instrument

1 unchanged sentence

We did no t have any derivative financial instruments as of December 31, 2022.

The following table lists the derivative financial instrument held by us as of March 31, 2023, which was included in security deposits, prepaid rent and other liabilities in our accompanying condensed consolidated balance sheet:

The following table provides information with respect to the derivative financial instrument held by us as of June 30, 2023, which was included in other assets, net in our accompanying condensed consolidated balance sheet (dollars in thousands):

Instrument Notional Amount Index Interest Rate Maturity Date Fair Value

March 31, 2023

June 30, 2023

Swap $ 275,000 one month

Term SOFR 3.74 % 01/19/26 $ 4,798

As of March 31, 2023, our derivative financial instrument was not designated as a hedge.

As of June 30, 2023, our derivative financial instrument was not designated as a hedge.

The derivative financial instrument not designated as a hedge is not speculative and is used to manage our exposure to interest rate movements, but does not meet the strict hedge accounting requirements.

For the three months ended March 31, 2023 and 2022, we recorded $ 195,000 and ($ 500,000 ), respectively, as an increase (decrease) to interest expense in our accompanying condensed consolidated statements of operations and comprehensive loss related to the change in the fair value of our derivative financial instrument.

See Note 14, Fair Value Measurements, for a further discussion of the fair value of our derivative financial instruments.

Identified Intangible Liabilities, Net

As of March 31, 2023 and December 31, 2022, identified intangible liabilities, net consisted of below-market leases of $ 10,429,000 and $ 10,837,000 , respectively, net of accumulated amortization of $ 2,898,000 and $ 2,508,000 , respectively.

Amortization expense on below-market leases for the three months ended March 31, 2023 and 2022 was $ 408,000 and $ 609,000 , respectively, which is recorded as an increase to real estate revenue in our accompanying condensed consolidated statements of operations and comprehensive loss.

The weighted average remaining life of below-market leases was 8.2 years and 8.4 years as of March 31, 2023 and December 31, 2022, respectively.

As of March 31, 2023, estimated amortization expense on below-market leases for the nine months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter was as follows:

2023 $ 1,188,000

2024 1,475,000

2025 1,347,000

2026 1,198,000

2027 1,162,000

Thereafter 4,059,000

Total $ 10,429,000

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

For the three months ended June 30, 2023 and 2022, we recorded $ 4,993,000 and $ 0 , respectively, and for the six months ended June 30, 2023 and 2022, we recorded $ 4,798,000 and $ 500,000 , respectively, as a decrease to interest expense in our accompanying condensed consolidated statements of operations and comprehensive loss related to the change in the fair value of our derivative financial instrument.

See Note 13, Fair Value Measurements, and Note 19, Subsequent Event, for a further discussion of our derivative financial instruments.

Commitments and Contingencies

We are not presently subject to any material litigation nor, to our knowledge, is any material litigation threatened against us, which if determined unfavorably to us, would have a material adverse effect on our consolidated financial position, results of operations or cash flows.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Environmental Matters

5 unchanged sentences

Redeemable Noncontrolling Interests

As of both March 31, 2023 and December 31, 2022, we, through our direct and indirect subsidiaries, owned a 95.0 % general partnership interest in our operating partnership and the remaining 5.0 % limited partnership interest in our operating partnership was owned by the NewCo Sellers.

As of both June 30, 2023 and December 31, 2022, we, through our direct and indirect subsidiaries, owned a 95.0 % general partnership interest in our operating partnership and the remaining 5.0 % limited partnership interest in our operating partnership was owned by the NewCo Sellers.

Some of the limited partnership units outstanding, which account for approximately 1.0 % of our total operating partnership units outstanding, have redemption features outside of our control and are accounted for as redeemable noncontrolling interests presented outside of permanent equity in our accompanying condensed consolidated balance sheets.

As of both March 31, 2023 and December 31, 2022, we, through Trilogy REIT Holdings LLC, or Trilogy REIT Holdings, in which we indirectly hold a 76.0 % ownership interest, owned 97.4 % and 96.2 %, respectively, of the outstanding equity interests of Trilogy.

As of March 31, 2023 and December 31, 2022, certain members of Trilogy’s management and certain members of an advisory committee to Trilogy’s board of directors owned approximately 2.6 % and 3.8 %, respectively, of the outstanding equity interests of Trilogy.

The noncontrolling interests held by such members have redemption features outside of our control and are accounted for as redeemable noncontrolling interests in our accompanying condensed consolidated balance sheets.

For the three months ended March 31, 2023, we redeemed a portion of the equity interests owned by current members of Trilogy’s management for an aggregate of $ 15,870,000 .

For the three months ended March 31, 2022, we did not redeem any equity interests of Trilogy.

As of March 31, 2023 and December 31, 2022, we own, through our operating partnership, approximately 98.0 % of the joint ventures with an affiliate of Meridian Senior Living, LLC, or Meridian, that own Central Florida Senior Housing Portfolio, Pinnacle Beaumont ALF and Pinnacle Warrenton ALF.

As of both June 30, 2023 and December 31, 2022, we, through Trilogy REIT Holdings LLC, or Trilogy REIT Holdings, in which we indirectly hold a 76.0 % ownership interest, owned 97.4 % and 96.2 %, respectively, of the outstanding equity interests of Trilogy.

As of June 30, 2023 and December 31, 2022, certain members of Trilogy’s management and certain members of an advisory committee to Trilogy’s board of directors owned approximately 2.6 % and 3.8 %, respectively, of the outstanding equity interests of Trilogy.

We account for such equity interests as redeemable noncontrolling interests in our accompanying condensed consolidated balance sheets in accordance with FASB Accounting Standards Codification Topic 480-10-S99-3A given certain features associated with such equity interests.

For the three and six months ended June 30, 2023, we redeemed a portion of the equity interests owned by current members of Trilogy’s management for an aggregate of $ 84,000 and $ 15,954,000 , respectively.

For the six months ended June 30, 2022, we did not redeem any equity interests of Trilogy.

As of June 30, 2023 and December 31, 2022, we own, through our operating partnership, approximately 98.0 % of the joint ventures with an affiliate of Meridian Senior Living, LLC, or Meridian, that own Central Florida Senior Housing Portfolio, Pinnacle Beaumont ALF and Pinnacle Warrenton ALF.

The noncontrolling interests held by Meridian have redemption features outside of our control and are accounted for as redeemable noncontrolling interests in our accompanying condensed consolidated balance sheets.

See Note 3, Real Estate Investments, Net and Business Combinations — Disposition of Real Estate Investment, for a disposition within our Central Florida Senior Housing Portfolio.

See Note 3, Real Estate Investments, Net and Business Combinations — Dispositions of Real Estate Investments, for dispositions within our Central Florida Senior Housing Portfolio.

We previously owned 90.0 % of the joint venture with Avalon Health Care, Inc., or Avalon, that owned Catalina West Haven ALF and Catalina Madera ALF.

The noncontrolling interests held by Avalon had redemption features outside of our control and were accounted for as redeemable noncontrolling interests until December 1, 2022, when we exercised our right to purchase the remaining 10.0 % of the joint venture with Avalon for a contract purchase price of $ 295,000 .

As such, 10.0 % of the net earnings of such joint venture were allocated to redeemable noncontrolling interests in our accompanying consolidated statements of operations and comprehensive loss for the three months ended March 31, 2022.

AMERICAN HEALTHCARE REIT, INC.

2 unchanged sentences

(i) the initial carrying amount, increased or decreased for the noncontrolling interests’ share of net income or loss and distributions or (ii) the redemption value.

The changes in the carrying amount of redeemable noncontrolling interests consisted of the following for the three months ended March 31, 2023 and 2022:

Three Months Ended March 31,

The changes in the carrying amount of redeemable noncontrolling interests consisted of the following for the six months ended June 30, 2023 and 2022 (in thousands):

Six Months Ended June 30,

Beginning balance $ 81,598 $ 72,725

4 unchanged sentences

Adjustment to redemption value ( 4,422 ) 3,833

Net (loss) income attributable to redeemable noncontrolling interests ( 368,000 ) 187,000

Net loss attributable to redeemable noncontrolling interests ( 486 ) ( 31 )

Ending balance $ 59,873 $ 75,337

1 unchanged sentence

Pursuant to our charter, we are authorized to issue 200,000,000 shares of our preferred stock, par value $ 0.01 per share.

As of both March 31, 2023 and December 31, 2022, no shares of preferred stock were issued and outstanding.

As of both June 30, 2023 and December 31, 2022, no shares of preferred stock were issued and outstanding.

Pursuant to our charter, as amended, we are authorized to issue 1,000,000,000 shares of our common stock, par value $ 0.01 per share, whereby 200,000,000 shares are classified as Class T common stock and 800,000,000 shares are classified as Class I common stock.

As of March 31, 2023, after taking into consideration the Merger and the impact of the reverse stock split as discussed below, we had issued 65,445,557 shares for a total of $ 2,737,716,000 of common stock since February 26, 2014 in our initial public offerings and DRIP offerings (includes historical offering amounts sold by GAHR III and GAHR IV prior to the Merger).

See “Distribution Reinvestment Plan” section below for a further discussion.

As of June 30, 2023, after taking into consideration the Merger and the impact of the reverse stock split as discussed below, we had issued 65,445,557 shares for a total of $ 2,737,716,000 of common stock since February 26, 2014 in our initial public offerings and DRIP offerings (includes historical offering amounts sold by GAHR III and GAHR IV prior to the Merger).

See “Distribution Reinvestment Plan” section below for further discussion.

On November 15, 2022 we effected a one-for-four reverse split of our common stock and a corresponding reverse split of the partnership units in our operating partnership.

5 unchanged sentences

Our DRIP allowed our stockholders to elect to reinvest an amount equal to the distributions declared on their shares of common stock in additional shares of our common stock in lieu of receiving cash distributions.

However, in connection with the Proposed Listing, on November 14, 2022, our board suspended the DRIP offering beginning with the distributions declared, if any, for the quarter ended December 31, 2022.

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

However, in connection with the Proposed Listing, on November 14, 2022, our board suspended the DRIP offering beginning with the distributions declared for the quarter ended December 31, 2022.

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

Our board has been establishing an estimated per share net asset value, or NAV, annually.

6 unchanged sentences

03/15/23 $ 31.40

For the three months ended March 31, 2023 and 2022, $ 0 and $ 11,304,000 , respectively, in distributions were reinvested and 0 and 306,518 shares of our common stock, respectively, were issued pursuant to our DRIP offerings.

For both the three and six months ended June 30, 2023, there were no distributions reinvested and no shares of our common stock were issued pursuant to our DRIP offerings.

For the three and six months ended June 30, 2022, $ 11,143,000 and $ 22,447,000 , respectively, in distributions were reinvested and 299,857 and 606,375 shares of our common stock, respectively, were issued pursuant to our DRIP offerings.

Share Repurchase Plan

5 unchanged sentences

All share repurchase requests, including requests resulting from the death or qualifying disability of stockholders, received 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.

Funds for the repurchase of shares of our common stock came from the cumulative proceeds we received from the sale of shares of our common stock pursuant to our DRIP offerings.

Funds for the repurchase of shares of our common stock were derived from the cumulative proceeds we received from the sale of shares of our common stock pursuant to our DRIP offerings.

Pursuant to our share repurchase plan, the repurchase price with respect to repurchases resulting from the death or qualifying disability of stockholders was equal to the most recently published estimated per share NAV.

For the three months ended March 31, 2023 and 2022, we repurchased 1,681 and 112,094 shares of common stock, respectively, for an aggregate of $ 62,000 and $ 4,134,000 , respectively, at a repurchase price of $ 37.16 and $ 36.88 per share, respectively, pursuant to our share repurchase plan.

We did no t repurchase any shares of our common stock pursuant to our share repurchase plan for the three months ended June 30, 2023.

For the six months ended June 30, 2023, pursuant to our share repurchase plan, we repurchased 1,681 shares of common stock for $ 62,000 , at a repurchase price of $ 37.16 per share.

For the three and six months ended June 30, 2022, pursuant to our share repurchase plan, we repurchased 174,865 and 286,959 shares of common stock, respectively, for an aggregate of $ 6,449,000 and $ 10,583,000 , respectively, at a repurchase price of $ 36.88 per share.

Such repurchase requests were submitted prior to the suspension of our share repurchase plan.

Noncontrolling Interests in Total Equity

As of March 31, 2023 and December 31, 2022, Trilogy REIT Holdings owned approximately 97.4 % and 96.2 %, respectively, of Trilogy.

We are the indirect owner of a 76.0 % interest of Trilogy REIT Holdings pursuant to an amended joint venture agreement with an indirect, wholly owned subsidiary of NorthStar Healthcare Income, Inc., or NHI.

As of June 30, 2023 and December 31, 2022, Trilogy REIT Holdings owned approximately 97.4 % and 96.2 %, respectively, of Trilogy.

We are the indirect owner of a 76.0 % interest in Trilogy REIT Holdings pursuant to an amended joint venture agreement with an indirect, wholly owned subsidiary of NorthStar Healthcare Income, Inc., or NHI.

We serve as the managing member of Trilogy REIT Holdings.

As of both March 31, 2023 and December 31, 2022, NHI indirectly owned a 24.0 % membership interest in Trilogy REIT Holdings and as such, for the three months ended March 31, 2023 and 2022, 24.0 % of the net earnings of Trilogy REIT Holdings were allocated to noncontrolling interests.

As of both June 30, 2023 and December 31, 2022, NHI indirectly owned a 24.0 % membership interest in Trilogy REIT Holdings and as such, for the three and six months ended June 30, 2023 and 2022, 24.0 %of the net earnings of Trilogy REIT Holdings were allocated to noncontrolling interests.

In connection with our operation of Trilogy, time-based profit interest units in Trilogy, or the Profit Interests, were issued to Trilogy Management Services, LLC and two independent directors of Trilogy, both unaffiliated third parties that manage or direct the day-to-day operations of Trilogy.

The Profit Interests are measured at their grant date fair value and vest in increments of 20.0 % on each anniversary of the respective grant date over a five-year period.

We amortize the Profit Interests on a straight-line basis over the vesting periods, which are recorded to general and administrative in our accompanying condensed consolidated statements of operations and comprehensive loss.

We amortize the Profit Interests on a straight-line basis over the vesting periods, which are recorded to general and administrative expenses in our accompanying condensed consolidated statements of operations and comprehensive loss.

The nonvested Profit Interests are presented as noncontrolling interests in total equity in our accompanying condensed consolidated balance sheets, and are re-classified to redeemable noncontrolling interests upon vesting as they had redemption features outside of our control, similar to the common stock units held by Trilogy’s management.

See Note 12, Redeemable Noncontrolling Interests, for a further discussion.

There were no canceled, expired or exercised Profit Interests during the three months ended March 31, 2023 and 2022.

For both three months ended March 31, 2023 and 2022, we recognized stock compensation expense related to the time-based Profit Interests of $ 21,000 .

One of our consolidated subsidiaries issued non-voting preferred shares of beneficial interests to qualified investors for total proceeds of $ 125,000 .

These preferred shares of beneficial interests are entitled to receive cumulative preferential cash dividends at the rate of 12.5 % per annum.

See Note 11, Redeemable Noncontrolling Interests, for further discussion.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

of beneficial interests in net income or loss attributable to noncontrolling interests in our accompanying condensed consolidated statements of operations and comprehensive loss.

As of both March 31, 2023 and December 31, 2022, we owned an 86.0 % interest in a consolidated limited liability company that owns Lakeview IN Medical Plaza.

As such, 14.0 % of the net earnings of Lakeview IN Medical Plaza were allocated to noncontrolling interests in our accompanying condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2023 and 2022.

As of both March 31, 2023 and December 31, 2022, we owned a 90.6 % membership interest in a consolidated limited liability company that owns Southlake TX Hospital.

As such, 9.4 % of the net earnings of Southlake TX Hospital were allocated to noncontrolling interests in our accompanying condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2023 and 2022.

As of both March 31, 2023 and December 31, 2022, we owned a 90.0 % interest in a joint venture that owns the Louisiana Senior Housing Portfolio.

As such, 10.0 % of the net earnings of the joint venture were allocated to noncontrolling interests in our accompanying condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2023 and 2022.

As discussed in Note 1, Organization and Description of Business, as of both March 31, 2023 and December 31, 2022, we, through our direct and indirect subsidiaries, own a 95.0 % general partnership interest in our operating partnership and the remaining 5.0 % limited partnership interest in our operating partnership is owned by the NewCo Sellers.

As of both March 31, 2023 and December 31, 2022, 4.0 % of our total operating partnership units outstanding is presented in total equity in our accompanying condensed consolidated balance sheets.

See Note 12, Redeemable Noncontrolling Interests, for a further discussion.

There were no canceled, expired or exercised Profit Interests during the three and six months ended June 30, 2023 and 2022.

For the three months ended June 30, 2023 and 2022, we recognized stock compensation expense related to the time-based Profit Interests of $ 20,000 and $ 21,000 , respectively.

For the six months ended June 30, 2023 and 2022, we recognized stock compensation expense related to the time-based Profit Interests of $ 41,000 and $ 42,000 , respectively.

One of our consolidated subsidiaries issued non-voting preferred shares of beneficial interests to qualified investors for total proceeds of $ 125,000 .

These preferred shares of beneficial interests are entitled to receive cumulative preferential cash dividends at the rate of 12.5 % per annum.

We classify the value of our subsidiary’s preferred shares of beneficial interests as noncontrolling interests in our accompanying condensed consolidated balance sheets and the dividends of the preferred shares of beneficial interests in net income or loss attributable to noncontrolling interests in our accompanying condensed consolidated statements of operations and comprehensive loss.

As of both June 30, 2023 and December 31, 2022, we owned an 86.0 % interest in a consolidated limited liability company that owns Lakeview IN Medical Plaza.

As of both June 30, 2023 and December 31, 2022, we owned a 90.6 % membership interest in a consolidated limited liability company that owns Southlake TX Hospital.

As of both June 30, 2023 and December 31, 2022, we owned a 90.0 % interest in a joint venture that owns the Louisiana Senior Housing Portfolio.

As discussed in Note 1, Organization and Description of Business, as of both June 30, 2023 and December 31, 2022, we, through our direct and indirect subsidiaries, own a 95.0 % general partnership interest in our operating partnership and the remaining 5.0 % limited partnership interest in our operating partnership is owned by the NewCo Sellers.

As of both June 30, 2023 and December 31, 2022, 4.0 % of our total operating partnership units outstanding is presented in total equity in our accompanying condensed consolidated balance sheets.

See Note 11, Redeemable Noncontrolling Interests, for further discussion.

AHR 2015 Incentive Plan

Pursuant to the Amended and Restated 2015 Incentive Plan, or the AHR Incentive Plan, which our board (with respect to options and restricted shares of common stock granted to independent directors), or our compensation committee (with respect to any other award), may make grants of options, restricted shares of common stock, stock purchase rights, stock appreciation rights or other awards to our independent directors, officers, employees and consultants.

The maximum number of shares of our common stock that may be issued pursuant to the AHR Incentive plan is 1,000,000 shares.

Pursuant to the Amended and Restated 2015 Incentive Plan, our board (with respect to options and restricted shares of common stock granted to independent directors), or our compensation committee (with respect to any other award), may grant options, restricted shares of common stock, stock purchase rights, stock appreciation rights or other awards to our independent directors, officers, employees and consultants.

On June 15, 2023, we adopted the Second Amended and Restated 2015 Incentive Plan, or the AHR Incentive Plan, which, among other things, increased the maximum number of shares of our common stock that may be issued pursuant to such plan from 1,000,000 to 4,000,000 shares, extended the term of such plan to June 15, 2033 and made certain administrative changes to the Amended and Restated 2015 Incentive Plan.

Restricted common stock

Pursuant to the AHR Incentive Plan, through March 31, 2023, we granted an aggregate of 291,259 shares of our restricted common stock, or RSAs, which include restricted Class T common stock and restricted Class I common stock.

Pursuant to the AHR Incentive Plan, through June 30, 2023, we granted an aggregate of 315,459 shares of our restricted common stock, or RSAs, which include restricted Class T common stock and restricted Class I common stock, as defined in the AHR Incentive Plan.

RSAs were granted to our independent directors in connection with their initial election or re-election to our board or in consideration of their past services rendered.

In addition, certain executive officers and key employees received grants of restricted Class T common stock, as defined in the AHR Incentive Plan.

In addition, certain executive officers and key employees received grants of restricted Class T common stock.

RSAs generally have a vesting period ranging from one to four years and are subject to continuous service through the vesting dates.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Restricted stock units

Pursuant to the AHR Incentive Plan, through March 31, 2023, we granted to our executive officers and certain employees an aggregate 29,352 of performance-based restricted stock units, or PBUs, representing the right to receive shares of our Class T common stock upon vesting.

We also granted to certain employees 19,200 time-based restricted stock units, or TBUs, representing the right to receive shares of our Class T common stock upon vesting.

Pursuant to the AHR Incentive Plan, through June 30, 2023, we granted our executive officers an aggregate 70,751 of performance-based restricted stock units, or PBUs, representing the right to receive shares of our Class T common stock upon vesting.

We also granted to our executive officers and certain employees 169,529 time-based restricted stock units, or TBUs, representing the right to receive shares of our Class T common stock upon vesting.

PBUs and TBUs are collectively referred to as RSUs.

RSUs granted to executive officers and employees generally have a vesting period of up to three years and are subject to continuous service through the vesting dates, and any performance conditions, as applicable.

For the three months ended March 31, 2023 and 2022, we recognized stock compensation expense related to awards granted pursuant to the AHR Incentive Plan of $ 1,051,000 and $ 811,000 , respectively, based on the grant date fair value for time based awards and for performance based awards that are probable of vesting, which are equal to the most recently published estimated per share NAV.

Such stock compensation expense is included in general and administration in our accompanying condensed consolidated statements of operations and comprehensive loss.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

A summary of the status of our nonvested RSAs and RSUs as of June 30, 2023 and December 31, 2022 and the changes for the six months ended June 30, 2023 is presented below:

RSAs Number of

RSUs Weighted

Balance — December 31, 2022

183,240 $ 36.97 48,553 $ 37.16

Granted 26,156 31.83 191,728 31.40

Vested ( 21,030 ) 37.47 ( 6,400 ) (1) 37.16

Forfeited — — — —

Balance — June 30, 2023

188,366 $ 36.20 233,881 $ 32.44

(1) Amount includes 2,280 shares of common stock that were withheld from issuance to satisfy employee minimum tax withholding requirements associated with the vesting of RSUs during the six months ended June 30, 2023.

For the three months ended June 30, 2023 and 2022, we recognized $ 1,564,000 and $ 980,000 , respectively, and for the six months ended June 30, 2023 and 2022, we recognized $ 2,615,000 and $ 1,791,000 , respectively, in stock compensation expense related to awards granted pursuant to the AHR Incentive Plan based on the grant date fair value for time based awards and for performance-based awards that are probable of vesting, which grant date fair value is equal to the most recently published estimated per share NAV.

Such stock compensation expense is included in general and administrative expenses in our accompanying condensed consolidated statements of operations and comprehensive loss.

Fair Value Measurements

Assets and Liabilities Reported at Fair Value

The table below presents our assets and liabilities measured at fair value on a recurring basis as of March 31, 2023, aggregated by the level in the fair value hierarchy within which those measurements fall:

The table below presents our assets and liabilities measured at fair value on a recurring basis as of June 30, 2023, aggregated by the level in the fair value hierarchy within which those measurements fall (in thousands):

Quoted Prices in

7 unchanged sentences

Derivative financial instrument $ — $ 4,798 $ — $ 4,798

Total liabilities at fair value $ — $ 195,000 $ — $ 195,000

There were no transfers into and out of fair value measurement levels during the three months ended March 31, 2023 and 2022.

Total assets at fair value $ — $ 4,798 $ — $ 4,798

There were no transfers into and out of fair value measurement levels during the six months ended June 30, 2023 and 2022.

We did not have any assets and liabilities measured at fair value on a recurring basis as of December 31, 2022.

3 unchanged sentences

The valuation of these instruments was determined using widely accepted valuation techniques including a discounted cash flow analysis on the expected cash flows of each derivative.

Such valuation reflected the contractual terms of the derivatives, including the period to maturity, and used observable market-based inputs, including interest rate curves, as well as option volatility.

Such valuation reflected the contractual terms of the derivatives, including the period to maturity, and used

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

observable market-based inputs, including interest rate curves, as well as option volatility.

The fair value of our interest rate swap was determined by netting the discounted future fixed cash payments and the discounted expected variable cash receipts.

3 unchanged sentences

Although we determined that the majority of the inputs used to value our derivative financial instrument fell within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with this instrument utilized Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by us and our counterparty.

However, as of March 31, 2023, we assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative position and determined that the credit valuation adjustments were not significant to the overall valuation of our derivative.

However, as of June 30, 2023, we assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative position and determined that the credit valuation adjustments were not significant to the overall valuation of our derivative.

As a result, we determined that our derivative valuation in its entirety was classified in Level 2 of the fair value hierarchy.

2 unchanged sentences

Our accompanying condensed consolidated balance sheets include the following financial instruments:

debt security investment, cash and cash equivalents, restricted cash, accounts and other receivables, accounts payable and accrued liabilities, accounts payable due to affiliates, mortgage loans payable and borrowings under our lines of credit and term loan.

debt security investment, cash and cash equivalents, restricted cash, accounts and other receivables, accounts payable and accrued liabilities, mortgage loans payable and borrowings under our lines of credit and term loan.

We consider the carrying values of cash and cash equivalents, restricted cash, accounts and other receivables and accounts payable and accrued liabilities to approximate the fair value for these financial instruments based upon an evaluation of the underlying characteristics, market data and because of the short period of time between origination of the instruments and their expected realization.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

The fair value of our debt security investment is estimated using a discounted cash flow analysis using interest rates available to us for investments with similar terms and maturities.

1 unchanged sentence

We have determined that the valuations of our debt security investment, mortgage loans payable and lines of credit and term loan are classified in Level 2 within the fair value hierarchy.

The carrying amounts and estimated fair values of such financial instruments as of March 31, 2023 and December 31, 2022 were as follows:

The carrying amounts and estimated fair values of such financial instruments as of June 30, 2023 and December 31, 2022 were as follows (in thousands):

Amount(1) Fair

11 unchanged sentences

TRS may participate in services that would otherwise be considered impermissible for REITs and are subject to federal and state income tax at regular corporate tax rates.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Current Income Tax

5 unchanged sentences

If the tax benefit meets the “more likely than not” threshold, the measurement of the tax benefit will be based on our estimate of the ultimate tax benefit to be sustained if audited by the taxing authority.

As of both March 31, 2023 and December 31, 2022, we did not have any tax benefits or liabilities for uncertain tax positions that we believe should be recognized in our accompanying condensed consolidated financial statements.

As of both June 30, 2023 and December 31, 2022, we did not have any tax benefits or liabilities for uncertain tax positions that we believe should be recognized in our accompanying condensed consolidated financial statements.

We assess the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets.

A valuation allowance is established if we believe it is more likely than not that all or a portion of the deferred tax assets are not realizable.

As of both March 31, 2023 and December 31, 2022, our valuation allowance fully reserves the net deferred tax assets due to historical losses and inherent uncertainty of future income.

As of both June 30, 2023 and December 31, 2022, our valuation allowance fully reserves the net deferred tax assets due to historical losses and inherent uncertainty of future income.

We will continue to monitor industry and economic conditions, and our ability to generate taxable income based on our business plan and available tax planning strategies, which would allow us to utilize the tax benefits of the net deferred tax assets and thereby allow us to reverse all, or a portion of, our valuation allowance in the future.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

We have operating leases with tenants that expire at various dates through 2050.

For the three months ended March 31, 2023 and 2022, we recognized $ 42,303,000 and $ 50,731,000 , respectively, of revenues related to operating lease payments, of which $ 10,040,000 and $ 10,413,000 , respectively, was for variable lease payments.

As of March 31, 2023, the following table sets forth the undiscounted cash flows for future minimum base rents due under operating leases for the nine months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter for properties that we wholly own:

2023 $ 115,063,000

2024 146,081,000

2025 132,908,000

2026 121,949,000

For the three months ended June 30, 2023 and 2022, we recognized $ 49,216,000 and $ 50,060,000 , respectively, of revenues related to operating lease payments, of which $ 9,711,000 and $ 9,663,000 , respectively, was for variable lease payments.

For the six months ended June 30, 2023 and 2022, we recognized $ 91,519,000 and $ 100,790,000 , respectively, of revenues related to operating lease payments, of which $ 19,750,000 and $ 20,076,000 , respectively, was for variable lease payments.

As of June 30, 2023, the following table sets forth the undiscounted cash flows for future minimum base rents due under operating leases for the six months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter for properties that we wholly own (in thousands):

2023 $ 75,245

6 unchanged sentences

Certain leases also include options to purchase the leased property.

As of June 30, 2023, we had future lease payments of $ 6,054,000 for an operating lease that had not yet commenced.

Such operating lease will commence in fiscal year 2023 with a lease term of five years .

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

1 unchanged sentence

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The components of lease costs were as follows:

Three Months Ended March 31,

The components of lease costs were as follows (in thousands):

Three Months Ended June 30,

Lease Cost Classification 2023

6 unchanged sentences

Total lease cost $ 11,664 $ 5,556

Six Months Ended June 30,

Lease Cost Classification 2023

Operating lease cost(1) Property operating expenses, rental expenses or general and administrative expenses $ 23,396 $ 11,764

Finance lease cost:

Amortization of leased assets

Depreciation and amortization 600 629

Interest on lease liabilities Interest expense 157 140

Sublease income Resident fees and services revenue or other income ( 328 ) ( 382 )

Total lease cost $ 23,825 $ 12,151

(1) Includes short-term leases and variable lease costs, which are immaterial.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Additional information related to our leases for the periods presented below was as follows:

Lease Term and Discount Rate March 31,

Additional information related to our leases for the periods presented below was as follows (dollars in thousands):

Lease Term and Discount Rate June 30,

Weighted average remaining lease term (in years):

6 unchanged sentences

7.74 % 7.66 %

Three Months Ended March 31,

Six Months Ended June 30,

Supplemental Disclosure of Cash Flows Information 2023 2022

2 unchanged sentences

Right-of-use assets obtained in exchange for operating lease liabilities $ 1,155 $ 646

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Operating Leases

As of March 31, 2023, the following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments for the nine months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter, as well as the reconciliation of those cash flows to operating lease liabilities on our accompanying condensed consolidated balance sheet:

2023 $ 29,017,000

2024 37,779,000

2025 37,197,000

2026 37,255,000

As of June 30, 2023, the following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments for the six months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter, as well as the reconciliation of those cash flows to operating lease liabilities on our accompanying condensed consolidated balance sheet (in thousands):

2023 $ 19,240

4 unchanged sentences

Finance Leases

As of March 31, 2023, the following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments for the nine months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter, as well as a reconciliation of those cash flows to finance lease liabilities:

2023 $ 53,000

As of June 30, 2023, the following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments for the six months ending December 31, 2023 and for each of the next four years ending December 31 and thereafter, as well as a reconciliation of those cash flows to finance lease liabilities (in thousands):

Total undiscounted finance lease payments 136

interest 14,000

Present value of finance lease liabilities $ 125

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Segment Reporting

As of March 31, 2023, we evaluated our business and made resource allocations based on six reportable business segments:

integrated senior health campuses, MOBs, SHOP, SNFs, senior housing — leased and hospitals.

As of June 30, 2023, we evaluated our business and made resource allocations based on six reportable business segments:

integrated senior health campuses, MOBs, SNFs, SHOP, senior housing — leased and hospitals.

Our MOBs are typically leased to multiple tenants under separate leases, thus requiring active management and responsibility for many of the associated operating expenses (much of which are, or can effectively be, passed through to the tenants).

5 unchanged sentences

While we believe that net income (loss), as defined by GAAP, is the most appropriate earnings measurement, we evaluate our segments’ performance based upon segment net operating income or loss, or NOI.

We define segment NOI as total revenues and grant income, less property operating expenses and rental expenses, which excludes depreciation and amortization, general and administrative expenses, business acquisition expenses, interest expense, gain or loss on dispositions of real estate investments, impairment of real estate investments, income or loss from unconsolidated entities, impairment of goodwill, foreign currency gain or loss, gain on re-measurement of previously held equity interest, other income and income tax benefit or expense for each segment.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

of real estate investments, impairment of real estate investments, income or loss from unconsolidated entities, impairment of goodwill, foreign currency gain or loss, gain on re-measurement of previously held equity interest, other income and income tax benefit or expense for each segment.

We believe that segment NOI serves as an appropriate supplemental performance measure to net income (loss) because it allows investors and our management to measure unlevered property-level operating results and to compare our operating results to the operating results of other real estate companies and between periods on a consistent basis.

1 unchanged sentence

Non-segment assets primarily consist of corporate assets including cash and cash equivalents, other receivables, deferred financing costs and other assets not attributable to individual properties.

Summary information for the reportable segments during the three and six months ended June 30, 2023 and 2022 was as follows (in thousands):

Senior Health

Campuses SHOP MOBs Senior

Leased SNFs Hospitals Three Months

June 30, 2023

Revenues and grant income:

Resident fees and services $ 362,856 $ 47,766 $ — $ — $ — $ — $ 410,622

Real estate revenue — — 36,640 5,392 6,090 2,446 50,568

Grant income 6,381 — — — — — 6,381

Total revenues and grant income 369,237 47,766 36,640 5,392 6,090 2,446 467,571

Property operating expenses 328,696 43,853 — — — — 372,549

Rental expenses — — 13,927 229 378 119 14,653

Segment net operating income $ 40,541 $ 3,913 $ 22,713 $ 5,163 $ 5,712 $ 2,327 $ 80,369

General and administrative $ 11,774

Business acquisition expenses 888

Depreciation and amortization 44,701

Other income (expense):

Interest expense:

Interest expense (including amortization of deferred financing costs and debt discount/premium) ( 40,990 )

Gain in fair value of derivative financial instruments 4,993

Loss on dispositions of real estate investments ( 2,072 )

Loss from unconsolidated entities ( 113 )

Foreign currency gain 1,068

Other income 2,589

Total net other expense ( 34,525 )

Loss before income taxes ( 11,519 )

Income tax expense ( 348 )

Net loss $ ( 11,867 )

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Summary information for the reportable segments during the three months ended March 31, 2023 and 2022 was as follows:

Senior Health

1 unchanged sentence

Leased SNFs Hospitals Three Months

March 31, 2023

June 30, 2022

Revenues and grant income:

Resident fees and services

$ 287,582 $ 38,643 $ — $ — $ — $ — $ 326,225

Real estate revenue

Total revenues 361,770,000 46,860,000 37,483,000 5,276,000 ( 1,632,000 ) 2,469,000 452,226,000

— — 36,833 5,262 6,599 2,411 51,105

Grant income 10,969 — — — — — 10,969

Total revenues and grant income 298,551 38,643 36,833 5,262 6,599 2,411 388,299

Property operating expenses

258,934 37,125 — — — — 296,059

Rental expenses

Segment net operating income (loss) $ 33,409,000 $ 5,075,000 $ 23,075,000 $ 5,077,000 $ ( 2,101,000 ) $ 2,350,000 $ 66,885,000

— — 13,791 212 521 139 14,663

Segment net operating income $ 39,617 $ 1,518 $ 23,042 $ 5,050 $ 6,078 $ 2,272 $ 77,577

General and administrative

2 unchanged sentences

Other income (expense):

Interest expense (including amortization of deferred financing costs, debt discount/premium and gain on debt extinguishments) ( 20,345 )

Loss on dispositions of real estate investments ( 73 )

Impairment of real estate investments ( 17,340 )

Income from unconsolidated entities 638

Foreign currency loss ( 3,607 )

Other income 469

Total net other expense ( 40,258 )

Loss before income taxes ( 15,337 )

Income tax expense ( 205 )

Net loss $ ( 15,542 )

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Senior Health

Campuses SHOP MOBs Senior

Leased SNFs Hospitals Six Months

June 30, 2023

Revenues and grant income:

Resident fees and services $ 724,626 $ 94,626 $ — $ — $ — $ — $ 819,252

Real estate revenue — — 74,123 10,668 4,458 4,915 94,164

Grant income 6,381 — — — — — 6,381

Total revenues and grant income 731,007 94,626 74,123 10,668 4,458 4,915 919,797

Property operating expenses 657,057 85,638 — — — — 742,695

Rental expenses — — 28,335 428 847 238 29,848

Segment net operating income $ 73,950 $ 8,988 $ 45,788 $ 10,240 $ 3,611 $ 4,677 $ 147,254

General and administrative $ 24,827

Business acquisition expenses 1,220

Depreciation and amortization 89,371

Other income (expense):

Interest expense:

Interest expense (including amortization of deferred financing costs and debt discount/premium) ( 80,001 )

Loss in fair value of derivative financial instruments ( 195,000 )

Loss on disposition of real estate investment ( 132,000 )

Gain in fair value of derivative financial instruments 4,798

Loss on dispositions of real estate investments ( 2,204 )

Loss from unconsolidated entities ( 419 )

10 unchanged sentences

Campuses SHOP MOBs Senior

Leased SNFs Hospitals Three Months

March 31, 2022

Leased SNFs Hospitals Six Months

June 30, 2022

Revenues and grant income:

15 unchanged sentences

Interest expense:

Interest expense (including amortization of deferred financing costs, debt discount/premium and loss on debt extinguishment) ( 23,325,000 )

Interest expense (including amortization of deferred financing costs, debt discount/premium and loss on debt extinguishments) ( 43,670 )

Gain in fair value of derivative financial instruments 500

Gain on dispositions of real estate investments 683

Impairment of real estate investments ( 17,340 )

Income from unconsolidated entities 2,024

5 unchanged sentences

Net loss $ ( 16,439 )

Total assets by reportable segment as of March 31, 2023 and December 31, 2022 were as follows:

Total assets by reportable segment as of June 30, 2023 and December 31, 2022 were as follows (in thousands):

Integrated senior health campuses $ 2,159,186 $ 2,157,748

8 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

As of and for the three months ended March 31, 2023 and 2022, goodwill by reportable segment was as follows:

As of and for the six months ended June 30, 2023 and 2022, goodwill by reportable segment was as follows (in thousands):

Senior Health

4 unchanged sentences

Goodwill acquired 3,331 — — — — — 3,331

Balance — March 31, 2023

Balance — June 30, 2023

$ 168,177 $ — $ 47,812 $ 5,924 $ 8,640 $ 4,389 $ 234,942

4 unchanged sentences

Goodwill acquired 2,816 — — — — — 2,816

Balance — March 31, 2022

Balance — June 30, 2022

$ 122,672 $ 23,277 $ 47,812 $ 5,924 $ 8,640 $ 4,389 $ 212,714

2 unchanged sentences

Revenues and grant income and assets are attributed to the country in which the property is physically located.

The following is a summary of geographic information for our operations for the periods presented:

Three Months Ended March 31,

The following is a summary of geographic information for our operations for the periods presented (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

2023 2022 2023 2022

Revenues and grant income:

2 unchanged sentences

$ 467,571 $ 388,299 $ 919,797 $ 764,430

The following is a summary of real estate investments, net by geographic regions as of March 31, 2023 and December 31, 2022:

The following is a summary of real estate investments, net by geographic regions as of June 30, 2023 and December 31, 2022 (in thousands):

Real estate investments, net:

7 unchanged sentences

We have cash and cash equivalents in financial institutions that are insured by the Federal Deposit Insurance Corporation, or FDIC.

As of March 31, 2023 and December 31, 2022, we had cash and cash equivalents in excess of FDIC insured limits.

As of June 30, 2023 and December 31, 2022, we had cash and cash equivalents in excess of FDIC insured limits.

We believe this risk is not significant.

1 unchanged sentence

We perform credit evaluations of prospective tenants and security deposits are obtained at the time of property acquisition and upon lease execution.

Based on leases as of March 31, 2023, properties in one state in the United States accounted for 10.0 % or more of our total property portfolio’s annualized base rent or annualized NOI, which is based on contractual base rent from leases in effect for our non-RIDEA properties and annualized NOI for our SHOP and integrated senior health campuses as of March 31, 2023.

AMERICAN HEALTHCARE REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) — (Continued)

Properties located in Indiana accounted for 32.4 % of our total property portfolio’s annualized base rent or annualized NOI.

Accordingly, there is a geographic concentration of risk subject to fluctuations in such state’s economy.

Based on leases in effect as of March 31, 2023, our six reportable business segments, integrated senior health campuses, MOBs, SHOP, SNFs, senior housing — leased and hospitals accounted for 42.6 %, 33.7 %, 10.3 %, 6.8 %, 3.8 % and 2.8 %, respectively, of our total property portfolio’s annualized base rent or annualized NOI.

As of March 31, 2023, no ne of our tenants at our properties accounted for 10.0 % or more of our total property portfolio’s annualized base rent or annualized NOI.

Based on leases as of June 30, 2023, properties in two states in the United States accounted for 10.0 % or more of our total consolidated property portfolio’s annualized base rent or annualized NOI, which is based on contractual base rent from leases in effect for our non-RIDEA properties and annualized NOI for our SHOP and integrated senior health campuses as of June 30, 2023.

Properties located in Indiana and Michigan accounted for 34.6 % and 10.9 %, respectively, of our total consolidated property portfolio’s annualized base rent or annualized NOI.

Accordingly, there is a geographic concentration of risk subject to fluctuations in each state’s economy.

Based on leases in effect as of June 30, 2023, our six reportable business segments, integrated senior health campuses, MOBs, SNFs, SHOP, senior housing — leased and hospitals accounted for 44.4 %, 35.0 %, 7.3 %, 6.1 %, 4.1 % and 3.1 %, respectively, of our total consolidated property portfolio’s annualized base rent or annualized NOI.

As of June 30, 2023, no ne of our tenants at our properties accounted for 10.0 % or more of our total consolidated property portfolio’s annualized base rent or annualized NOI.

Per Share Data

Basic earnings (loss) per share for all periods presented are computed by dividing net income (loss) applicable to common stock by the weighted average number of shares of our common stock outstanding during the period.

Net income (loss) applicable to common stock is calculated as net income (loss) attributable to controlling interest less distributions allocated to participating securities of $ 926,000 and $ 1,490,000 for the three months ended March 31, 2023 and 2022, respectively.

Net income (loss) applicable to common stock is calculated as net income (loss) attributable to controlling interest less distributions allocated to participating securities of $ 962,000 and $ 1,498,000 for the three months ended June 30, 2023 and 2022, respectively, and $ 1,888,000 and $ 2,988,000 for the six months ended June 30, 2023 and 2022, respectively.

Diluted earnings (loss) per share are computed based on the weighted average number of shares of our common stock and all potentially dilutive securities, if any.

TBUs, nonvested shares of our RSAs and limited partnership units of our operating partnership are participating securities and give rise to potentially dilutive shares of our common stock.

As of March 31, 2023 and 2022, there were 184,145 and 222,886 nonvested shares, respectively, of our RSAs outstanding, but such shares were excluded from the computation of diluted earnings (loss) per share because such shares were anti-dilutive during these periods.

As of both March 31, 2023 and 2022, there were 3,501,976 limited partnership units of our operating partnership outstanding, but such units were also excluded from the computation of diluted earnings (loss) per share because such units were anti-dilutive during these periods.

As of March 31, 2023, there were 19,200 nonvested time-based restricted stock units outstanding, which were granted on April 1, 2022, but such units were excluded from the computation of diluted earnings (loss) per share because such restricted stock units were anti-dilutive during the period.

As of March 31, 2023, there were 29,352 nonvested performance-based restricted stock units outstanding, which were treated as contingently issuable shares pursuant to ASC Topic 718, Compensation — Stock Compensation .

As of June 30, 2023 and 2022, there were 188,368 and 221,740 nonvested shares, respectively, of our RSAs outstanding, but such shares were excluded from the computation of diluted earnings (loss) per share because such shares were anti-dilutive during these periods.

As of both June 30, 2023 and 2022, there were 3,501,976 limited partnership units of our operating partnership outstanding, but such units were also excluded from the computation of diluted earnings (loss) per share because such units were anti-dilutive during these periods.

As of June 30, 2023 and 2022, there were 163,133 and 19,200 nonvested time-based restricted stock units outstanding, respectively, but such units were excluded from the computation of diluted earnings (loss) per share because such restricted stock units were anti-dilutive during the period.

As of June 30, 2023, there were 70,751 nonvested performance-based restricted stock units outstanding, which were treated as contingently issuable shares pursuant to ASC Topic 718, Compensation — Stock Compensation .

Such contingently issuable shares were excluded from the computation of diluted earnings (loss) per share because they were anti-dilutive during the period.

Subsequent Event

Issuance of Restricted Stock Units

On April 3, 2023, pursuant to the AHR Incentive Plan, we granted our executive officers and certain employees 148,311 TBUs, which vest in three equal annual installments on April 3, 2024, April 3, 2025 and April 3, 2026 (subject to continuous employment through each vesting date) and represent the right to receive shares of our Class T common stock upon vesting.

In addition, our executive officers and certain employees received 41,399 PBUs representing the right to receive shares of our Class T common stock upon vesting.

The PBUs will cliff vest in the first quarter of 2026 (subject to continuous employment through that vesting date) with the amount vesting depending on meeting certain key performance criteria as further described in the AHR Incentive Plan.

Interest Rate Swap

We, through our operating partnership, entered into an interest rate swap transaction, or the Swap, with Regions Bank with an effective date of August 8, 2023 and a maturity date of January 19, 2026.

We entered into the Swap to mitigate the risk associated with the remaining $ 275,000,000 of our floating-rate term loan that was unhedged (without incurring substantial prepayment penalties or defeasance costs typically associated with fixed-rate indebtedness) under our existing 2022 Credit Facility.

Beginning on September 1, 2023, we are required to make monthly fixed-rate payments at a rate of 4.41 % while the counterparty is obligated to make monthly floating-rate payments based on Term SOFR, which was 5.30 % as of August 8, 2023.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements