What changed in this filing

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Item 1. Financial Statements

2025-05-01 compared with 2024-10-29 · 344 added, 384 removed, 455 unchanged (62% of the section changed)

3 unchanged sentences

(in thousands, except share and per share amounts)

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Real estate investments, net $ 2,252,279 $ 2,226,740

Other real estate related investments (including accrued interest of $ 5,826 as of September 30, 2024 and $ 1,727 as of December 31, 2023)

Financing receivable, at fair value (including accrued interest of $ 905 as of March 31, 2025 and $ 281 as of December 31, 2024)

96,628 96,004

Assets held for sale 16,046 15,011

Other real estate related investments (including accrued interest of $ 6,005 as of March 31, 2025 and $ 4,725 as of December 31, 2024)

799,799 795,203

Assets held for sale, net 16,736 57,261

Cash and cash equivalents 26,510 213,822

Restricted cash 606,000 —

Accounts and other receivables 1,954 1,174

4 unchanged sentences

Senior unsecured notes payable, net $ 397,149 $ 396,927

Senior unsecured term loan, net — 199,559

Unsecured revolving credit facility 425,000 —

Accounts payable, accrued liabilities and deferred rent liabilities 51,069 56,318

2 unchanged sentences

Commitments and contingencies (Note 13)

Redeemable noncontrolling interest 17,396 18,243

Preferred stock, $ 0.01 par value;

100,000,000 shares authorized, no shares issued and outstanding as of September 30, 2024 and December 31, 2023

100,000,000 shares authorized, no shares issued and outstanding as of March 31, 2025 and December 31, 2024

Common stock, $ 0.01 par value;

500,000,000 shares authorized, 171,122,858 and 129,992,796 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

500,000,000 shares authorized, 187,669,948 and 186,993,010 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively

Additional paid-in capital 3,455,256 3,439,117

8 unchanged sentences

(in thousands, except per share amounts)

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2024 2023 2024 2023

For the Three Months Ended March 31,

Rental income $ 71,646 $ 53,502

Interest and other income 20,228 4,659 43,280 12,910

Interest income from financing receivable 2,807 —

Interest income from other real estate related investments and other income 22,168 9,568

Total revenues 96,621 63,070

3 unchanged sentences

Impairment of real estate investments — 2,744

Transaction costs 888 —

Property operating expenses 105 660

1 unchanged sentence

Total expenses 36,591 33,719

Loss on extinguishment of debt ( 657 ) — ( 657 ) —

(Loss) gain on sale of real estate, net ( 2,286 ) — ( 2,254 ) 1,958

Other income (loss):

Gain on sale of real estate, net 3,876 11

Unrealized gain (loss) on other real estate related investments, net 1,287 ( 612 )

Total other loss ( 1,143 ) ( 5,251 ) ( 3,600 ) ( 5,898 )

Total other income (loss) 5,163 ( 601 )

Net income 65,193 28,750

Net loss attributable to noncontrolling interests ( 165 ) ( 11 ) ( 501 ) ( 11 )

Net (loss) income attributable to noncontrolling interests ( 609 ) 4

Net income attributable to CareTrust REIT, Inc.

8 unchanged sentences

CARETRUST REIT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTEREST

(in thousands, except share and per share amounts)

2 unchanged sentences

Distributions in Excess of Earnings Total Stockholders’ Equity Noncontrolling Interests Total

Equity Redeemable Noncontrolling Interest

Shares Amount

7 unchanged sentences

Contributions from noncontrolling interests — — — — — 642 642 768

Net income — — — 28,746 28,746 4 28,750

Balance at March 31, 2024 141,712,165 1,417 2,152,454 ( 480,074 ) 1,673,797 2,299 1,676,096

Issuance of common stock, net 12,145,000 122 302,327 — 302,449 — 302,449

Vesting of stock-based compensation awards 24,768 — — — — — —

Amortization of stock-based compensation — — 1,406 — 1,406 — 1,406

Common dividends ($ 0.29 per share)

— — — ( 44,721 ) ( 44,721 ) — ( 44,721 )

Distributions to noncontrolling interests — — — — — ( 7 ) ( 7 )

Contributions from noncontrolling interests — — — — — 132 132

Net income (loss) — — — 65,802 65,802 106 65,908 ( 715 )

Balance at June 30, 2024 153,881,933 1,539 2,456,187 ( 514,037 ) 1,943,689 2,084 1,945,773

Issuance of common stock, net 17,240,925 172 493,472 — 493,644 — 493,644

Amortization of stock-based compensation — — 1,143 — 1,143 — 1,143

Common dividends ($ 0.29 per share)

— — — ( 49,721 ) ( 49,721 ) — ( 49,721 )

Distributions to noncontrolling interests — — — — — ( 7 ) ( 7 )

Contributions from noncontrolling interests — — — — — 628 628

Net income (loss) — — — 33,441 33,441 ( 165 ) 33,276

Balance at September 30, 2024 171,122,858 $ 1,711 $ 2,950,802 $ ( 530,317 ) $ 2,422,196 $ 2,540 $ 2,424,736

Balance at March 31, 2025 187,669,948 $ 1,877 $ 3,455,256 $ ( 529,821 ) $ 2,927,312 $ 3,469 $ 2,930,781 $ 17,396

See accompanying notes to condensed consolidated financial statements.

CARETRUST REIT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTEREST

(in thousands, except share and per share amounts)

2 unchanged sentences

Distributions in Excess of Earnings Total Stockholders’ Equity Noncontrolling Interests Total

Equity Redeemable Noncontrolling Interest

Shares Amount

Balance at December 31, 2023 129,992,796 $ 1,300 $ 1,883,147 $ ( 467,628 ) $ 1,416,819 $ 1,898 $ 1,418,717 $ —

Issuance of common stock, net 11,600,000 116 269,671 — 269,787 — 269,787 —

Vesting of stock-based compensation awards, net of shares withheld for employee taxes 119,369 1 ( 2,484 ) — ( 2,483 ) — ( 2,483 ) —

2 unchanged sentences

— — — ( 41,192 ) ( 41,192 ) — ( 41,192 ) —

Distributions to noncontrolling interests — — — — — ( 47 ) ( 47 ) —

Contributions from noncontrolling interests — — — — — 444 444 —

Net income — — — 28,746 28,746 4 28,750 —

Balance at March 31, 2024 141,712,165 $ 1,417 $ 2,152,454 $ ( 480,074 ) $ 1,673,797 $ 2,299 $ 1,676,096 $ —

Vesting of stock-based compensation awards 25,992 — — — — — —

Amortization of stock-based compensation — — 924 — 924 — 924

Common dividends ($ 0.28 per share)

— — — ( 27,737 ) ( 27,737 ) — ( 27,737 )

Net loss — — — ( 484 ) ( 484 ) — ( 484 )

Balance at June 30, 2023 99,124,082 991 1,245,717 ( 433,686 ) 813,022 — 813,022

Issuance of common stock, net 16,285,274 163 318,925 — 319,088 — 319,088

Amortization of stock-based compensation — — 1,519 — 1,519 — 1,519

Common dividends ($ 0.28 per share)

— — — ( 32,403 ) ( 32,403 ) — ( 32,403 )

Contributions from noncontrolling interests — — — — — 1,073 1,073

Net income (loss) — — — 8,696 8,696 ( 11 ) 8,685

Balance at September 30, 2023 115,409,356 $ 1,154 $ 1,566,161 $ ( 457,393 ) $ 1,109,922 $ 1,062 $ 1,110,984

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Cash flows from operating activities:

3 unchanged sentences

Amortization of deferred financing costs 914 614

Loss on extinguishment of debt 282 —

Unrealized loss on other real estate related investments, net 689 7,856

Unrealized (gain) loss on other real estate related investments, net ( 1,287 ) 612

Amortization of stock-based compensation 3,909 2,120

3 unchanged sentences

Noncash interest income ( 1,904 ) ( 425 )

Loss (gain) on sale of real estate, net 2,254 ( 1,958 )

Gain on sale of real estate, net ( 3,876 ) ( 11 )

Impairment of real estate investments — 2,744

7 unchanged sentences

Purchases of equipment, furniture and fixtures and improvements to real estate ( 2,276 ) ( 398 )

Preferred equity investments ( 52,000 ) —

Investment in real estate related investments and other loans receivable ( 504,936 ) ( 50,693 )

Investment in real estate related investments ( 6,389 ) ( 52,165 )

Principal payments received on real estate related investments and other loans receivable 4,582 —

4 unchanged sentences

Proceeds from the issuance of common stock, net 15,562 269,787

Proceeds from the secured borrowing 75,000 —

Borrowings under unsecured revolving credit facility 425,000 —

Payments on unsecured revolving credit facility — ( 310,000 )

Payments on senior unsecured term loan ( 200,000 ) —

Payment on secured borrowing ( 75,000 ) —

Payments on extinguishment of debt and deferred financing costs ( 399 ) ( 21 )

Payments of deferred financing costs ( 141 ) ( 24 )

Net-settle adjustment on restricted stock ( 3,325 ) ( 2,483 )

3 unchanged sentences

Net cash provided by financing activities 383,216 231,146

Net increase (decrease) in cash and cash equivalents 82,654 ( 9,693 )

Cash and cash equivalents as of the beginning of period 294,448 13,178

Cash and cash equivalents as of the end of period $ 377,102 $ 3,485

Net increase in cash, cash equivalents and restricted cash 418,688 156,725

Cash, cash equivalents and restricted cash as of the beginning of period 213,822 294,448

Cash, cash equivalents and restricted cash as of the end of period $ 632,510 $ 451,173

Supplemental disclosures of cash flow information:

2 unchanged sentences

Increase in dividends payable $ 8,665 $ 4,661

Right-of-use asset obtained in exchange for new operating lease obligation $ 1,748 $ 369

Transfer of pre-acquisition costs to acquired assets $ — $ 5

Sale of real estate settled with note receivable $ — $ 1,000

Liabilities assumed by buyer in connection with sale of real estate $ 2,776 $ —

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

Description of Business— CareTrust REIT, Inc.’s (“CareTrust REIT” or the “Company”) primary business consists of acquiring, financing, developing and owning real property to be leased to third-party tenants in the healthcare sector.

As of September 30, 2024, the Company owned, directly or through joint ventures, and leased to independent operators 226 skilled nursing facilities (“SNFs”), multi-service campuses, assisted living facilities (“ALFs”) and independent living facilities (“ILFs”) consisting of 24,512 operational beds and units located in 31 states with the highest concentration of properties by rental income located in California and Texas.

As of September 30, 2024, the Company also had other real estate related investments consisting of three preferred equity investments, 12 real estate secured loans receivable and four mezzanine loans receivable with a carrying value of $ 740.7 million.

As of March 31, 2025, the Company owned, directly or through joint ventures, and leased to independent operators 255 skilled nursing facilities (“SNFs”), multi-service campuses, assisted living facilities (“ALFs”) and independent living facilities (“ILFs”) consisting of 27,672 operational beds and units located in 32 states with the highest concentration of properties by rental income located in California, Texas and Tennessee.

As of March 31, 2025, the Company also had other real estate related investments consisting of three preferred equity investments, 15 real estate secured loans receivable, and five mezzanine loans receivable with a carrying value of $ 799.8 million and one financing receivable with a carrying value of $ 96.6 million.

Planned Acquisition— On March 11, 2025, the Company announced (the “Rule 2.7 Announcement”) pursuant to Rule 2.7 of the United Kingdom City Code on Takeovers and Mergers (the “Code”) a firm intention to make a cash offer (the “Offer”) to acquire (the “Acquisition”), through its wholly-owned direct subsidiary, CR United Bidco Limited (“Bidco”), the entire issued and to be issued ordinary share capital (other than Scheme Restricted Shares (as defined in the Rule 2.7 Announcement)) of Care REIT plc (“Target”) for 108 pence in cash per ordinary share of Target.

Target is a UK-based real estate investment trust listed on the Main Market of the London Stock Exchange focused on investing in care homes throughout the United Kingdom.

The Acquisition is intended to be effected by means of a scheme of arrangement (the “Scheme”) under Part 26 of the United Kingdom Companies Act 2006, meaning it is subject to court approval and the satisfaction or waiver of other ordinary conditions to closing, following approval by Target’s shareholders.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 unchanged sentences

All intercompany transactions and account balances within the Company have been eliminated, and net earnings are reduced by the portion of net earnings attributable to noncontrolling interests.

Transfers of financial assets —The Company accounts for transfers of financial assets as sales when it has surrendered control over the related assets.

Whether control has been relinquished requires, among other things, an evaluation of relevant legal considerations and an assessment of the nature and extent of the Company’s continuing involvement with the assets transferred.

Transfers of financial assets that do not qualify for sale accounting are reported as collateralized borrowings.

Accordingly, the related assets remain on the Company’s balance sheet and continue to be reported and accounted for as if the transfer had not occurred.

Cash proceeds from these transfers are reported as liabilities, with attributable interest expense recognized over the life of the related transactions.

Restricted cash —The Company presents cash and cash equivalents separately from restricted cash within the Company’s condensed consolidated balance sheets.

The Company includes restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown in the condensed consolidated statements of cash flows.

The Company provides a reconciliation between the balance sheets and statements of cash flows, as required when the balance includes more than one line item for cash, cash equivalents and restricted cash.

The Company also provides a disclosure of the nature of the restrictions related to material restricted cash balances.

As of March 31, 2025, the Company had $ 606.0 million in restricted cash related to the cash deposited with the trustee for the planned acquisition of Care REIT plc.

Cash, cash equivalents and restricted cash consisted of the following as of March 31, 2025 and December 31, 2024 (dollars in thousands):

March 31, 2025 December 31, 2024

Cash and cash equivalents $ 26,510 $ 213,822

Restricted cash 606,000 —

Cash, cash equivalents and restricted cash $ 632,510 $ 213,822

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

REAL ESTATE INVESTMENTS, NET

The following table summarizes the Company’s investment in owned properties, and properties held in consolidated joint ventures, held for use as of September 30, 2024 and December 31, 2023 (dollars in thousands):

September 30, 2024 December 31, 2023

The following table summarizes the Company’s investment in owned properties, and properties held in consolidated joint ventures, held for use as of March 31, 2025 and December 31, 2024 (dollars in thousands):

March 31, 2025 December 31, 2024

Land $ 377,669 $ 367,044

5 unchanged sentences

Real estate investments, net $ 2,252,279 $ 2,226,740

As of September 30, 2024, all of the Company’s owned and held for investment facilities were leased to various operators under triple-net leases.

During the third quarter of 2022, the Company entered into a triple-net lease agreement for two of the Company’s facilities which are being repurposed to behavioral health facilities, one of which was classified as held for sale during the three months ended September 30, 2024.

As of March 31, 2025, all of the Company’s owned facilities held for investment were leased to various operators under triple-net leases.

All of the triple-net leases contain annual escalators based on the percentage change in the Consumer Price Index (“CPI”) (but not less than zero), some of which are subject to a cap, or fixed rent escalators.

As of September 30, 2024, 8 facilities were held for sale.

As of March 31, 2025, six facilities were held for sale.

See Note 4, Impairment of Real Estate Investments, Assets Held for Sale and Asset Sales, for additional information.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

As of September 30, 2024, the Company’s total future contractual minimum rental income for all of its tenants, excluding operating expense reimbursements, assets held for sale and assets being repurposed, was as follows (dollars in thousands):

2024 (three months) $ 56,317

As of March 31, 2025, the Company’s total future contractual minimum rental income for all of its tenants, excluding operating expense reimbursements and assets held for sale, was as follows (dollars in thousands):

2025 (nine months) $ 210,437

Thereafter 1,367,365

Total $ 2,971,283

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Tenant Purchase Options

5 unchanged sentences

SNF 1 March 2029 04/01/2022 (4)

SNF 4 November 2034 12/1/2024 (4)

SNF 1 January 2030 02/01/2026 (4)

SNF / Campus 2 October 2032 03/05/2027 (5)

SNF / Campus 2 May 2034 06/01/2026 (6)

SNF / Campus 1 May 2034 6/1/2027 (8)

SNF 1 November 2034 12/01/2027 (4)

SNF 6 November 2039 12/01/2027 (7)

(1) The Company has not received notice of exercise for the option periods that are currently open.

2 unchanged sentences

B - Fixed capitalization rate on lease revenue.

(3) Based on annualized cash revenue for contracts in place as of September 30, 2024.

(3) Based on annualized cash revenue for contracts in place as of March 31, 2025.

(4) Option window is open until the expiration of the lease term.

(5) Option window is open for six months from the option period open date.

(6) Purchase option reflects two option types.

(7) Purchase option provides for purchase of two of three facilities.

(6) Option window is open for nine months from the option period open date.

(7) Lease agreement provides for the purchase of one to two facilities in each window over four option windows, for a total of six facilities.

Each option window opens at the beginning of each of lease years four, five, six, and seven beginning December 1, 2027 and is open for one year .

(8) Option reflects two option types.

(9) Lease provides for abatement in the first three months.

Annual rent beginning in month four is $ 1.2 million.

(10) Option provides for purchase of any two of the three facilities.

The current cash rent shown is an average of the range of $ 3.2 million to $ 3.5 million.

(8) Purchase option window is open for nine months from the option period open date.

(9) Purchase option provides for purchase of one of five facilities.

(11) Option provides for purchase of any one of five facilities in the first option window and another one of five facilities in the second option window beginning June 1, 2027.

The current cash rent shown is an average of the range of $ 2.4 million to $ 3.1 million.

If the operator exercises its option to extend the term of the master lease, beginning on June 1, 2035 and ending nine months thereafter, the operator will have a purchase option for all facilities then remaining in the master lease.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Provided the operator exercises its option to extend the term of the master lease, beginning on June 1, 2035 and ending nine months thereafter, the operator will have an option for all facilities then remaining in the master lease.

Rental Income

The following table summarizes components of the Company’s rental income (dollars in thousands):

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Rental Income 2025 2024

3 unchanged sentences

Amortization of lease incentives ( 49 ) —

Amortization of below-market leases 809 — 1,959 —

Amortization of below-market lease intangibles 926 575

Total $ 71,646 $ 53,502

1 unchanged sentence

For tenants on a cash basis, this represents the lesser of the amount that would be recognized on a straight-line basis or cash that has been received.

Tenant operating expense reimbursements for the three months ended September 30, 2024 and 2023 were $ 1.7 million and $ 2.0 million, respectively.

Tenant operating expense reimbursements for the nine months ended September 30, 2024 and 2023 were $ 5.1 million and $ 3.9 million, respectively.

Tenant operating expense reimbursements for the three months ended March 31, 2025 and 2024 were $ 2.3 million and $ 1.5 million, respectively.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Recent Real Estate Acquisitions

The following table summarizes the Company’s acquisitions for the nine months ended September 30, 2024 (dollars in thousands):

The following table summarizes the Company’s acquisitions for the three months ended March 31, 2025 (dollars in thousands):

Type of Property Purchase Price (1)

3 unchanged sentences

$ 20,448 $ 2,000 1 124

Multi-service campuses (5)

78,154 6,268 4 575

Assisted living 20,637 1,896 1 160

11,036 1,022 1 86

Total $ 41,085 $ 3,896 2 284

4 unchanged sentences

See Note 12, Variable Interest Entities , for additional information.

(5) Includes two multi-service campuses held through a joint venture.

See Note 11, Variable Interest Entities , for additional information.

(6) Includes one ALF held through a joint venture.

See Note 11, Variable Interest Entities , for additional information.

Lease Amendments and Terminations

Lease Termination and Amended Ensign Lease.

Effective September 1, 2024, one SNF in Kansas was removed from a master lease with a skilled nursing operator and the Company terminated the master lease.

Annual cash rent under the terminated master lease prior to lease termination was approximately $ 0.8 million.

In connection with the lease termination, the Company amended and extended one existing triple-net master lease with subsidiaries of The Ensign Group, Inc.

(“Ensign”) to include the one SNF.

The amended lease has a remaining term of approximately 15 years with two five-year renewal options and CPI-based rent escalators.

Annual cash rent under the applicable Ensign master lease, as amended, increased by approximately $ 0.6 million.

Lease Termination and New Jaybird Lease.

Effective August 1, 2024, two ALFs in Illinois were removed from a master lease with a seniors housing operator and the Company terminated the master lease.

In connection with the lease termination, the Company entered into a new master lease (the “Jaybird Lease”) with affiliates of Jaybird Senior Living, Inc.

(“Jaybird”) with respect to the two ALFs.

The new Jaybird Lease commenced on August 1, 2024 with an initial term of approximately 12 years, featuring two five-year renewal options and CPI-based rent escalators.

Under the Jaybird Lease, Jaybird will receive three months of abated rent, followed by fifteen months of rent calculated as a percentage of the tenants’ gross revenue.

Subsequently, the next twelve months will have a fixed annual cash rent amount of $ 1.8 million.

Annual rent under the terminated master lease was $ 1.8 million.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

New Bayshire Lease.

On April 1, 2024, a new master lease with affiliates of Bayshire, LLC (“Bayshire”) commenced to lease one SNF that was previously under a short-term master lease until Bayshire received regulatory approval.

The short-term master lease was terminated.

The Bayshire master lease had a term of approximately 15 years at the date of the lease, with two five-year renewal options and 3 % fixed rent escalators.

Initial annual cash rent under the new Bayshire master lease was $ 2.6 million.

The Bayshire lease provides for a rent deferral of $ 0.4 million in the first year to be repaid in 15 installments beginning in year two.

Amended Kalesta Lease.

Effective February 28, 2025, the Company acquired one ALF.

In connection with the acquisition, the Company amended its existing triple-net master lease with affiliates of Kalesta Healthcare, LLC (“Kalesta”) to include the one ALF and extended the initial lease term.

The Kalesta master lease, as amended, had a remaining term at the date of amendment of approximately 15 years.

Annual cash rent under the amended Kalesta master lease increased by approximately $ 1.9 million.

Ridgeline Lease Termination and NC Jaybird Lease.

Effective December 31, 2024, the Company terminated its master lease with affiliates of Ridgeline Properties, LLC (“Ridgeline”).

The Company entered into a new master lease (the “NC Jaybird Lease”) with affiliates of Jaybird Senior Living, Inc.

(“Jaybird”) with respect to two ALFs in North Carolina previously leased to Ridgeline.

The NC Jaybird Lease commenced on January 1, 2025 with an initial term of approximately 12 years, featuring two five-year renewal options and CPI-based rent escalators.

Under the NC Jaybird Lease, Jaybird will receive three months of abated rent, followed by 15 months of rent calculated as a percentage of the tenants’ gross revenue.

Subsequently, the next twelve months will have a fixed annual cash rent amount of $ 0.8 million increasing annually based on CPI.

Annual cash rent under the terminated master lease for the two ALFs in North Carolina was $ 0.8 million.

Four facilities which were under the Ridgeline master lease are currently held for sale and two facilities are in the process of transferring operations.

Amended Eduro Lease and Amended Ensign Lease.

On March 1, 2024, operations of two SNFs in Colorado operated by affiliates of Eduro Healthcare, LLC (“Eduro”) were transferred to subsidiaries of Ensign.

On March 1, 2024, operations of two SNFs in Colorado operated by affiliates of Eduro Healthcare, LLC (“Eduro”) were transferred to subsidiaries of The Ensign Group, Inc.

In connection with the transfer, the Company partially terminated the Eduro master lease and amended one existing triple-net master lease with Ensign to include the two SNFs and extended the initial lease term by 15 years.

10 unchanged sentences

Initial annual cash rent under the lease is approximately $ 0.6 million and the master lease provides Embassy with a partial rent abatement until required authorizations with respect to the ALF portion of the facility are obtained and occupancy levels reach a certain percentage.

Premier Termination and Amended Ridgeline Lease.

Effective September 1, 2023, six ALFs in Michigan and North Carolina were removed from the master lease with affiliates of Premier Senior Living, LLC (“Premier”) and the Company terminated the Premier master lease.

Annual cash rent under the Premier master lease prior to lease termination was approximately $ 2.7 million.

In connection with the lease termination, the Company amended its existing triple-net master lease with affiliates of Ridgeline Properties, LLC (“Ridgeline”) with respect to the six ALFs.

The Ridgeline lease had a remaining term at the date of the lease amendment of approximately 15 years with two five-year renewal options and CPI-based rent escalators.

Annual cash rent under the amended lease increased by approximately $ 2.7 million.

The amended lease provides for $ 0.2 million in rent abatement and a $ 0.2 million rent deferral to be repaid beginning in December 2024.

Amended Pennant Lease.

On July 6, 2023, the Company amended its master lease with the Pennant Group, Inc.

(“Pennant”) (the “Pennant Master Lease”).

In connection with the lease amendment, the Company extended the initial lease term.

The Pennant Master Lease, as amended, had a remaining term at the date of amendment of approximately 15 years, with two five-year renewal options and CPI-based rent escalators.

Annual cash rent under the amended Pennant Master Lease remained unchanged.

Noble VA Lease Termination and New Pennant Lease.

Effective March 16, 2023, two ALFs in Wisconsin were removed from a master lease with affiliates of Noble VA Holdings (“Noble VA”) and the Company terminated the applicable Noble VA master lease.

Annual cash rent under the applicable Noble VA master lease prior to lease termination was approximately $ 2.3 million.

In connection with the lease termination, the Company entered into a new lease (the “New Pennant Lease”) with Pennant with respect to the two ALFs.

The New Pennant Lease had an initial term at the date of the lease of approximately 15 years with two five-year renewal options and CPI-based rent escalators.

Annual cash rent under the new lease was approximately $ 0.8 million and the master lease provides Pennant with three months deferred rent to be repaid before the expiration or termination of the lease.

CARETRUST REIT, INC.

2 unchanged sentences

Impairment of Real Estate Investments Held for Sale

During the three and nine months ended September 30, 2024, the Company recognized aggregate impairment charges of $ 8.4 million and $ 36.9 million, respectively, related to properties held for sale, which is reported in impairment of real estate investments in the condensed consolidated income statements.

During the three and nine months ended September 30, 2023, the Company recognized aggregate impairment charges of $ 0.2 million and $ 23.5 million, respectively, related to properties held for sale, which is reported in impairment of real estate investments in the condensed consolidated income statements.

During the three months ended September 30, 2024, the Company determined that two facilities held for sale no longer met the criteria to be held for sale and were reclassified as held for investment.

As of September 30, 2024, there were 8 facilities classified as held for sale, all of which have been marked down to fair value less estimated costs to sell.

The Company did not recognize any impairment during the three months ended March 31, 2025.

During the three months ended March 31, 2024, the Company recognized aggregate impairment charges of $ 2.7 million related to properties held for sale, which is reported in impairment of real estate investments in the condensed consolidated income statements.

As of March 31, 2025, there were six facilities classified as held for sale, all of which have been recorded at the lesser of their carrying value or fair value less estimated costs to sell.

The fair values of the assets held for sale were based on estimated sales prices, which are considered to be Level 3 (as defined below) measurements within the fair value hierarchy.

2 unchanged sentences

There are inherent uncertainties in making these assumptions.

For the Company’s impairment calculations during the nine months ended September 30, 2024, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit ranging from $ 5,000 to $ 94,000 , with a weighted average price per unit of $ 36,000 .

For the Company’s impairment calculations during the nine months ended September 30, 2023, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit ranging from $ 18,000 to $ 35,000 , with a weighted average price per unit of $ 23,000 .

Impairment of Real Estate Investments Held for Investment

During the three and nine months ended September 30, 2023, the Company recognized an impairment charge of $ 8.0 million related to one SNF.

The Company wrote down its carrying value of $ 8.7 million to its estimated fair value of $ 0.7 million as of September 30, 2023, which is included in real estate investments, net on the Company’s consolidated balance sheets.

The fair value of the asset was based on comparable market transactions and considered Level 3 (as defined below) measurements within the fair value hierarchy.

For the Company’s impairment calculation, the Company’s fair value estimates primarily relied on a market approach and utilized a price per unit of $ 7,000 .

For the Company’s impairment calculations during the three months ended March 31, 2024, the Company’s fair value estimates primarily relied on a market approach and utilized prices per unit ranging from $ 12,000 to $ 36,000 , with a weighted average price per unit of $ 16,000 .

Asset Sales and Held for Sale Reclassifications

On August 30, 2024, the Company completed the sale of a portfolio of 11 SNFs located in Iowa and Georgia, leased to affiliates of Arboreta Healthcare, Inc., as shown in the table below.

The following table summarizes the Company’s dispositions for the three and nine months ended September 30, 2024 and 2023 (dollars in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

The following table summarizes the Company’s dispositions for the three months ended March 31, 2025 and 2024 (dollars in thousands):

Three Months Ended March 31,

Number of facilities (1)

2 unchanged sentences

Net carrying value 40,525 1,035

Net (loss) gain on sale $ ( 2,286 ) $ — $ ( 2,254 ) $ 1,958

(1) Net sales proceeds for the nine months ended September 30, 2024 includes $ 1.0 million of seller financing in connection with the sale of one ALF in January 2024.

Net sales proceeds for the three and nine months ended September 30, 2024 includes $ 2.8 million of liabilities assumed by the buyer in connection with the sale of 11 SNFs.

Net sales proceeds for the nine months ended September 30, 2023 includes $ 2.0 million of seller financing in connection with the sale of one ALF in June 2023.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Net gain on sale $ 3,876 $ 11

(1) One non-operational previously impaired facility sold during the three months ended March 31, 2025 was not classified as held for sale as of December 31, 2024.

(2) Net sales proceeds for the three months ended March 31, 2024 includes $ 1.0 million of seller financing in connection with the sale of one ALF in January 2024.

The following table summarizes the Company’s assets held for sale activity for the periods presented (dollars in thousands):

1 unchanged sentence

December 31, 2024 $ 57,261 10

Additions to assets held for sale 54,021 10

Assets sold ( 40,525 ) ( 4 )

Impairment of real estate held for sale ( 36,872 ) —

Assets reclassified to held for investment ( 5,008 ) ( 2 )

September 30, 2024

March 31, 2025

December 31, 2023 $ 15,011 14

2 unchanged sentences

Impairment of real estate held for sale ( 2,744 ) —

September 30, 2023

March 31, 2024

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

OTHER REAL ESTATE RELATED AND OTHER INVESTMENTS

As of September 30, 2024 and December 31, 2023, the Company’s other real estate related investments, inclusive of accrued interest, consisted of the following (dollars in thousands):

As of March 31, 2025 and December 31, 2024, the Company’s other real estate related investments, inclusive of accrued interest, consisted of the following (dollars in thousands):

Facility Count and Type

As of September 30, 2024

As of March 31, 2025

Loans Receivable, at Fair Value:

SNF Campus ALF ILF Principal Balance as of September 30, 2024

Fair Value as of September 30, 2024

SNF Campus ALF ILF Principal Balance as of March 31, 2025

Fair Value as of March 31, 2025 (1)

Fair Value as of December 31, 2024 (1)

5 unchanged sentences

41 4 2 — 88,676 87,173 80,612 12.8 % 7/25/2027 - 12/31/2034

$ 695,037 $ 686,449 $ 178,568

As of September 30, 2024

Other Investments:

Principal Balance as of September 30, 2024

Book Value as of September 30, 2024

Total $ 742,716 $ 745,600 $ 741,004

As of March 31, 2025

Principal Balance as of March 31, 2025

Book Value as of March 31, 2025

Book Value as of December 31, 2024

2 unchanged sentences

Total $ 53,782 $ 54,199 $ 54,199

Facility Count and Type

As of March 31, 2025

Financing Receivable, at Fair Value:

SNF Campus ALF ILF Principal Balance as of March 31, 2025

Fair Value as of March 31, 2025 (5)

Fair Value as of December 31, 2024 (5)

Weighted Average Effective Interest Rate (6)

Maturity Date

Financing Receivable 39 — 5 2 $ 95,723 $ 96,628 $ 96,004 12.0 % 11/30/2039

Total $ 95,723 $ 96,628 $ 96,004

(1) Fair value of mortgage secured loans receivable includes $ 4.6 million and $ 3.4 million of accrued interest as of March 31, 2025 and December 31, 2024, respectively.

Fair value of mezzanine loans receivable includes $ 1.0 million and $ 0.9 million of accrued interest as of March 31, 2025 and December 31, 2024, respectively.

(2) Rates are net of subservicing fee, if applicable.

(3) Three mortgage secured loans receivable and two mezzanine loans receivable use term secured overnight financing rate (“SOFR”), which are subject to a floor for certain of the loans.

Term SOFR used as of September 30, 2024 was 4.84 %.

Term SOFR used as of March 31, 2025 was 4.32 %.

(4) If the Company also has extended mezzanine financing to an affiliate of the borrower under a mortgage loan receivable, the applicable facility counts are included in both respective totals.

(5) Fair value of financing receivable includes $ 0.9 million and $ 0.3 million of accrued interest as of March 31, 2025 and December 31, 2024, respectively.

(6) The Company leased these facilities back to the seller under a 15-year contract, with two five-year renewal options.

The agreement provides for an initial contractual cash yield of 11.0 % for the first three years , with annual CPI-based escalators beginning in year four, subject to a 3 % cap.

The agreement provides for deferred payments equal to 2.0 % of the contractual cash yield in the first year and 0.5 % of the contractual cash yield in the second year.

The agreement also provides for purchase options.

At the time the seller-lessee exercises its purchase options, option proceeds will be used to repay any outstanding deferred payments as well as additional payments such that the Company receives a contractual cash yield of 12.5 % on its gross investment in the applicable properties through the option exercise date.

If any deferred amounts remain unpaid, beginning in year eight, the deferred amounts are to be repaid in 24 equal monthly payments.

The Company has not received notice of exercise for the purchase option period currently open.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

The following table summarizes the Company’s other real estate related investments activity for the nine months ended September 30, 2024 and 2023 (dollars in thousands):

Nine Months Ended September 30,

The following table summarizes the Company’s other real estate related investments activity for the three months ended March 31, 2025 and 2024 (dollars in thousands):

Three Months Ended March 31,

Origination of other real estate related investments $ 6,389 $ 53,165

Accrued interest, net 1,280 425

Unrealized loss on other real estate related investments, net ( 689 ) ( 7,856 )

Unrealized gain (loss) on other real estate related investments, net 1,287 ( 612 )

Prepayments of other real estate related investments ( 4,360 ) —

1 unchanged sentence

2025 Other Real Estate Related Investment Transactions

On January 10, 2025, the Company advanced the second installment of a mezzanine loan for one SNF secured by a pledge of membership interests in an up-tier holding company of the borrower group for $ 6.4 million.

The loan bears interest at a rate of 13 %, with annual CPI-based escalators.

The mezzanine loan is set to mature on December 31, 2034.

The mezzanine loan may not be prepaid in whole or in part prior to maturity.

The Company elected the fair value option for the mezzanine loan.

In February 2025, the Company received a partial prepayment on one mortgage loan in the amount of $ 4.4 million in connection with the borrower’s election to release one skilled nursing facility from the loan.

The remaining outstanding balance of $ 2.9 million was subsequently paid off, see Note 15, Subsequent Events , for additional information.

2024 Other Real Estate Related Investment Transactions

On January 1, 2024, the Company closed on the sale of one ALF.

In connection with the sale, the Company provided affiliates of the purchaser of the property with a $ 1.0 million mortgage loan which bears interest at a rate of 9.0 %.

The mortgage loan is s ecured by the ALF and is set to mature on January 1, 2027.

The mortgage loan is secured by the ALF and is set to mature on January 1, 2027.

The mortgage loan may be prepaid in whole before the maturity date.

12 unchanged sentences

The Company elected the fair value option for the mezzanine loan.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

On February 2, 2024, the Company extended a $ 35.0 million mezzanine loan for a portfolio of 15 SNFs located in Virginia secured by a pledge of membership interests in an up-tier holding company of the borrower group.

6 unchanged sentences

The Company elected the fair value option for the mezzanine loan.

On May 1, 2024, the Company extended a $ 26.7 million mortgage loan to a skilled nursing real estate owner.

The mortgage loan is secured by two SNFs and bears interest at a rate of 9.1 %, payable monthly.

The mortgage loan is set to mature on May 1, 2031 and includes a one year extension option.

The mortgage loan may not be prepaid prior to July 31, 2029, subject to certain limited exceptions.

The mortgage loan includes a purchase option with an exercise window that opens during the initial 90-day period of each of the 4th, 5th and 6th loan years, with the purchase option price for the facilities being calculated by dividing the amount of the then annual base rent by an agreed upon lease yield.

The Company elected the fair value option for the mortgage loan.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

On June 3, 2024, the Company extended a $ 165.0 million mortgage loan to a regional health care real estate owner.

The mortgage loan is secured by eight SNFs located in North Carolina and bears interest at a rate of SOFR plus 4.25 %, with a term SOFR floor of 5.15 %, payable monthly and net of a 0.25 % subservicing fee.

Commencing on June 1, 2027, monthly principal payments will be due.

The mortgage loan is set to mature on June 1, 2029, and includes two six-month extension options.

The mortgage loan may not be prepaid prior to June 1, 2026, subject to certain limited exceptions.

The Company elected the fair value option for the mortgage loan.

Concurrently with closing, KeyBank National Association purchased a $ 75.0 million participation in the mortgage loan from the Company.

On July 30, 2024, the Company exercised the call option on the $ 75.0 million secured borrowing at a call purchase price equal to the principal amount plus accrued and unpaid interest and an exit fee of $ 0.4 million.

See Note 7, Debt , for additional information.

In addition, on June 3, 2024, the Company funded a $ 9.0 million preferred equity investment in an uptier parent entity of the borrower under the $ 165.0 million mortgage loan described above.

The Company's initial contractual yield on its preferred equity investment is 11 %.

Prepayment of the preferred equity investment is restricted, subject to certain carveouts, prior to the senior mortgage loan being paid off in full.

On August 1, 2024, the Company extended a $ 260.0 million mortgage loan to a skilled nursing real estate owner.

The loan is secured by a first priority mortgage lien on a real estate portfolio of 37 SNFs, ALFs and multi-service campuses located in various states and bears interest at a fixed rate of 8.4 %, payable monthly.

The mortgage loan is set to mature on August 1, 2029 and has a 24-month lockout period on prepayment subject to certain exceptions.

The mortgage loan may otherwise be prepaid in part or in whole after the 24-month lockout period with agreed upon exit fees, as applicable.

In addition, on August 1, 2024, the Company funded a $ 43.0 million preferred equity investment in an uptier holding company of the 37 -property skilled nursing and assisted living portfolio.

The Company's initial contractual yield on its preferred equity investment is 11 %.

Financing Receivable

On December 5, 2024, the Company invested $ 95.7 million, exclusive of transaction costs, to acquire a portfolio of 46 properties in Illinois in a sale and leaseback transaction with affiliates of Cascade Capital Partners, LLC (“Cascade”).

In connection with the transaction, the Company entered into a new triple-net master lease with Cascade and provided Cascade with options to repurchase the properties, structured over multiple tranches, with various option window start dates, beginning December 1, 2024, and open through the remainder of the 15 -year term.

As such, the Company determined that the sale and leaseback transaction met the accounting criteria to be presented as a financing receivable on its consolidated balance sheets and recorded interest income from financing receivable on its consolidated statements of operations.

Interest income is based on an imputed interest rate over the term of the applicable financing arrangement and as a result the interest recognized in any particular period will not equal the cash payments from the agreement in that period.

Cash received from the financing receivable was $ 2.2 million during the three months ended March 31, 2025.

The Company elected the fair value option for the financing receivable.

Other Loans Receivables

As of September 30, 2024 and December 31, 2023, the Company’s other loans receivable, included in prepaid expenses and other assets, net on the Company’s condensed consolidated balance sheets, consisted of the following (dollars in thousands):

As of September 30, 2024

Investment Principal Balance as of September 30, 2024

Book Value as of September 30, 2024

As of March 31, 2025 and December 31, 2024, the Company’s other loans receivable, included in prepaid expenses and other assets, net on the Company’s condensed consolidated balance sheets, consisted of the following (dollars in thousands):

As of March 31, 2025

Investment Principal Balance as of March 31, 2025

Book Value as of March 31, 2025

Book Value as of December 31, 2024

3 unchanged sentences

Total $ 21,757 $ 14,826 $ 15,016

(1) One other loan receivable with a principal balance of $ 4.9 million matured on June 30, 2024.

The Company and the borrower are in the process of negotiating terms for an extension of the maturity date.

The other loan receivable is considered collectible as of September 30, 2024.

The following table summarizes the Company’s other loans receivable activity for the nine months ended September 30, 2024 and 2023 (dollars in thousands):

Nine Months Ended September 30,

Origination of other loans receivable $ 985 $ 5,160

The following table summarizes the Company’s other loans receivable activity for the three months ended March 31, 2025 and 2024 (dollars in thousands):

Three Months Ended March 31,

Principal payments $ ( 222 ) $ —

2 unchanged sentences

Expected credit losses and recoveries are recorded in provision for loan losses, net in the condensed consolidated income statements.

During both the nine months ended September 30, 2024 and 2023, the Company had no additional expected credit loss and did not consider any loan receivable investments to be impaired.

During both the three months ended March 31, 2025 and 2024, the Company had no additional expected credit loss and did not consider any loan receivable investments to be impaired.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

The following table sum marizes the interest and other income recognized from the Company’s loans receivable and other investments during the three and nine months ended September 30, 2024 and 2023 (dollars in thousands):

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

The following table sum marizes the interest and other income recognized from the Company’s loans receivable and other investments during the three months ended March 31, 2025 and 2024 (dollars in thousands):

For the Three Months Ended March 31,

Investment 2025 2024

3 unchanged sentences

Other loans receivable 334 331

4,188 — 12,654 191

Financing receivable 2,807 —

Total $ 24,975 $ 9,568

(1) Other income is comprised of interest income on money market funds.

(1) Other income is comprised of interest income on money market funds and escrow deposits.

FAIR VALUE MEASUREMENTS

12 unchanged sentences

Items Measured at Fair Value on a Recurring Basis

The following table presents information about the Company’s assets measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023, aggregated by the level in the fair value hierarchy within which those instruments fall (dollars in thousands):

Level 1 Level 2 Level 3 Balance as of September 30, 2024

The following table presents information about the Company’s assets measured at fair value on a recurring basis as of March 31, 2025 and December 31, 2024, aggregated by the level in the fair value hierarchy within which those instruments fall (dollars in thousands):

Level 1 Level 2 Level 3 Balance as of March 31, 2025

Mortgage secured loans receivable $ — $ — $ 658,427 $ 658,427

Mezzanine loans receivable — — 87,173 87,173

Financing receivable — — 96,628 96,628

Total $ — $ — $ 842,228 $ 842,228

2 unchanged sentences

Mezzanine loans receivable — — 80,612 80,612

Financing receivable — — 96,004 96,004

Total $ — $ — $ 837,008 $ 837,008

The following table details the Company’s assets measured at fair value on a recurring basis using Level 3 inputs (dollars in thousands):

Investments in Real Estate Secured Loans Investments in Mezzanine Loans

Investments in Real Estate Secured Loans Investments in Mezzanine Loans Investment in Financing Receivable

Balance at December 31, 2024

$ 660,392 $ 80,612 $ 96,004

Loan originations 452,786 52,165

Originations — 6,389 —

Accrued interest, net 1,173 107 624

Unrealized (loss) gain on other real estate related investments, net ( 962 ) 273

Balance as of September 30, 2024

Unrealized gain, net 1,222 65 —

Payments ( 4,360 ) — —

Balance as of March 31, 2025

$ 658,427 $ 87,173 $ 96,628

Real estate secured and mezzanine loans receivable:

The fair values of the secured and mezzanine loans receivables were estimated using an internal valuation model that considered the expected future cash flows of the investment, the underlying collateral value, market interest rates and other credit enhancements.

The fair value of the secured and mezzanine loans receivables were estimated using an internal valuation model that considered the expected future cash flows of the investment, the underlying collateral value, market interest rates and other credit enhancements.

As such, the Company classifies each instrument as Level 3 due to the significant unobservable inputs used in determining market interest rates for investments with similar terms.

During the three months ended September 30, 2024, the Company recorded unrealized gains of $ 5.9 million, which were partially offset by unrealized losses of $ 4.1 million, on its secured and mezzanine loans receivable to bring the interest rates in line with market rates.

During the nine months ended September 30, 2024, the Company recorded unrealized losses on its secured and mezzanine loans receivable of $ 7.3 million, which were partially offset by unrealized gains of $ 6.6 million, to bring the interest rates in line with market rates.

During the three months ended March 31, 2025, the Company recorded a net unrealized gain of $ 1.3 million on its secured and mezzanine loans receivable, to bring the interest rates in line with market rates.

During the three months ended March 31, 2024, the Company recorded an unrealized loss of $ 0.8 million on the Company’s secured and mezzanine loans receivable due to rising interest rates, partially offset by unrealized gains of $ 0.2 million due to increases in expected cash flows on floating rate loans.

Future changes in market interest rates or collateral value could materially impact the estimated discounted cash flows that are used to determine the fair value of the secured and mezzanine loans receivable.

As of September 30, 2024 and December 31, 2023, the Company did no t have any loans that were 90 days or more past due.

The following table shows the quantitative information about unobservable inputs related to the Level 3 fair value measurements comprising the investments in secured and mezzanine loans receivables as of September 30, 2024:

Type Book Value as of September 30, 2024

As of March 31, 2025 and December 31, 2024, the Company did no t have any loans that were 90 days or more past due.

Type Book Value as of March 31, 2025

Valuation Technique Unobservable Inputs Range

1 unchanged sentence

Mezzanine loans receivable 87,173 Discounted cash flow Discount Rate 12 % - 14 %

For the nine months ended September 30, 2024, there were no classification changes in assets and liabilities with Level 3 inputs in the fair value hierarchy.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Financing receivable:

The fair value was determined using a widely accepted valuation technique, discounted cash flow analysis, on the expected cash flows.

The discount rate used to value the future cash inflows of the financing receivable at March 31, 2025 was 12 %.

For the three months ended March 31, 2025, there were no classification changes in assets and liabilities with Level 3 inputs in the fair value hierarchy.

Items Disclosed at Fair Value

1 unchanged sentence

The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments.

A summary of the face value, carrying amount and fair value of the Company’s preferred equity investments and the Notes (as defined in Note 7, Debt, below) as of September 30, 2024 and December 31, 2023 is as follows (dollars in thousands):

September 30, 2024 December 31, 2023

A summary of the face value, carrying amount and fair value of the Company’s preferred equity investments and the Notes (as defined in Note 7, Debt, below) as of March 31, 2025 and December 31, 2024 is as follows (dollars in thousands):

March 31, 2025 December 31, 2024

Value Carrying

4 unchanged sentences

Senior unsecured notes payable 2 $ 400,000 $ 397,149 $ 374,880 $ 400,000 $ 396,927 $ 381,812

Cash and cash equivalents, accounts and other receivables, accounts payable, and accrued liabilities:

Cash and cash equivalents, restricted cash, accounts and other receivables, accounts payable, and accrued liabilities:

The carrying values for these instruments approximate their fair values due to the short-term nature of these instruments.

5 unchanged sentences

The fair value of the Notes was determined using third-party quotes derived from orderly trades.

Unsecured revolving credit facility and senior unsecured term loan:

The fair values approximate their carrying values as the interest rates are variable and approximate prevailing market interest rates and spreads for similar debt arrangements.

The following table summarizes the balance of the Company’s indebtedness as of September 30, 2024 and December 31, 2023 (dollars in thousands):

September 30, 2024 December 31, 2023

Unsecured revolving credit facility:

The fair value approximates the carrying value as the interest rates are variable and approximate prevailing market interest rates and spreads for similar debt arrangements.

The following table summarizes the balance of the Company’s indebtedness as of March 31, 2025 and December 31, 2024 (dollars in thousands):

March 31, 2025 December 31, 2024

Principal Amount Deferred Loan Fees Carrying Amount Principal Amount Deferred Loan Fees Carrying Amount

Senior unsecured notes payable $ 400,000 $ ( 2,851 ) $ 397,149 $ 400,000 $ ( 3,073 ) $ 396,927

Senior unsecured term loan — — — 200,000 ( 441 ) 199,559

Unsecured revolving credit facility (1)

425,000 — 425,000 — — —

$ 825,000 $ ( 2,851 ) $ 822,149 $ 400,000 $ ( 3,073 ) $ 396,927

(1) Deferred financing fees are included in deferred financing costs, net on the balance sheet, and not reflected as a reduction to the unsecured revolving credit facility.

4 unchanged sentences

(together with the Operating Partnership, the “Issuers”), completed a private offering of $ 400.0 million aggregate principal amount of 3.875 % Senior Notes due 2028 (the “Notes”) to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A and to non-U.S.

persons outside the United States in reliance on Regulation S under the Securities Act of 1933, as amended.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

outside the United States in reliance on Regulation S under the Securities Act of 1933, as amended.

The Notes were issued at par, resulting in gross proceeds of $ 400.0 million and net proceeds of approximately $ 393.8 million after deducting underwriting fees and other offering expenses.

1 unchanged sentence

The Notes accrue interest at a rate of 3.875 % per annum payable semiannually in arrears on June 30 and December 30 of each year, commencing on December 30, 2021.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

The Issuers may redeem some or all of the Notes at any time prior to March 30, 2028 at a price equal to 100 % of the principal amount of the Notes redeemed plus accrued and unpaid interest on the Notes, if any, to, but not including, the redemption date, plus a “make-whole” premium.

14 unchanged sentences

The indenture governing the Notes also contains customary events of default.

As of September 30, 2024, the Company was in compliance with all applicable financial covenants under the indenture governing the Notes.

Unsecured Revolving Credit Facility and Term Loan

As of March 31, 2025, the Company was in compliance with all applicable financial covenants under the indenture governing the Notes.

Unsecured Revolving Credit Facility

On December 18, 2024, the Operating Partnership, as the borrower, the Company, as guarantor, CareTrust GP, LLC, and certain of the Operating Partnership’s wholly owned subsidiaries, entered into a third amended and restated credit and guaranty agreement with KeyBank National Association, as administrative agent, an issuing bank and swingline lender (as amended from time to time, the “Third Amended Credit Agreement”).

The Third Amended Credit Agreement, which amends and restates the Second Amended Credit Agreement (as defined below) provides for an upsized unsecured revolving credit facility (the “Third Amended Revolving Facility”) with revolving commitments in an aggregate principal amount of $ 1.2 billion, including a letter of credit subfacility for 10 % of the then available revolving commitments and a swingline loan subfacility for 10 % of the then available revolving commitments.

Future borrowings under the Third Amended Revolving Facility will be used for working capital purposes, for capital expenditures, to fund acquisitions and for general corporate purposes.

On December 16, 2022, the Operating Partnership, as the borrower, the Company, as guarantor, CareTrust GP, LLC, and certain of the Operating Partnership’s wholly owned subsidiaries, entered into a second amended and restated credit and guaranty agreement with KeyBank National Association, as administrative agent, an issuing bank and swingline lender (as amended from time to time, the “Second Amended Credit Agreement”).

The Second Amended Credit Agreement, which amends and restates the Company’s amended and restated credit and guaranty agreement, dated as of February 8, 2019 (as amended, the “Prior Credit Agreement”) provides for:

(i) an unsecured revolving credit facility (the “Revolving Facility”) with revolving commitments in an aggregate principal amount of $ 600.0 million, including a letter of credit subfacility for 10 % of the then available revolving commitments and a swingline loan subfacility for 10 % of the then available revolving commitments and (ii) the continuation of the unsecured term loan credit facility which was previously extended under the Prior Credit Agreement (the “Term Loan” and together with the Revolving Facility, the “Second Amended Credit Facility”) in an aggregate principal amount of $ 200.0 million.

Future borrowings under the Second Amended Credit Facility will be used for working capital purposes, for capital expenditures, to fund acquisitions and for general corporate purposes.

On October 10, 2023, the Operating Partnership, the Company, CareTrust GP, LLC, certain of the Operating Partnership’s wholly owned subsidiaries and KeyBank National Association entered into the First Amendment to the Second Amended Credit Agreement (the “First Amendment”).

The First Amendment restates the definition of Consolidated Total Asset Value to include net proceeds from at-the-market forward commitments executed but not yet closed as of the relevant date as if such proceeds had actually been received.

The interest rates applicable to loans under the Revolving Facility are, at the Operating Partnership’s option, equal to either a base rate plus a margin ranging from 0.10 % to 0.55 % per annum or Adjusted Term SOFR or Adjusted Daily Simple SOFR (each as defined in the Second Amended Credit Agreement) plus a margin ranging from 1.10 % to 1.55 % per annum based on the debt to asset value ratio of the Company and its consolidated subsidiaries (subject to decrease at the Operating Partnership’s election if the Company obtains certain specified investment grade ratings on its senior long-term unsecured debt).

The interest rates applicable to loans under the Term Loan are, at the Operating Partnership’s option, equal to either a base rate plus a margin ranging from 0.50 % to 1.20 % per annum or Adjusted Term SOFR or Adjusted Daily Simple SOFR plus a margin ranging from 1.50 % to 2.20 % per annum based on the debt to asset value ratio of the Company and its consolidated subsidiaries (subject to decrease at the Operating Partnership’s election if the Company obtains certain specified investment grade ratings on its senior long-term unsecured debt).

In addition, the Operating Partnership will pay a facility fee on the revolving commitments under the Revolving Facility ranging from 0.15 % to 0.35 % per annum, based on the debt to asset value

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

ratio of the Company and its consolidated subsidiaries (unless the Company obtains certain specified investment grade ratings on its senior long-term unsecured debt and the Operating Partnership elects to decrease the applicable margin as described above, in which case the Operating Partnership will pay a facility fee on the revolving commitments ranging from 0.125 % to 0.30 % per annum based on the credit ratings of the Company’s senior long-term unsecured debt).

On September 19, 2024 (the “Prepayment Date”), the Company elected to prepay all $ 200.0 million aggregate principal amount of their outstanding Term Loan.

The Term Loan was prepaid at the principal amount of the Term Loan, plus accrued and unpaid interest thereon up to, but not including, the Prepayment Date.

During the third quarter of 2024, the Company recorded a loss on extinguishment of debt of $ 0.3 million related to the write-off of deferred financing costs associated with the prepayment of the Term Loan.

As of September 30, 2024, the Operating Partnership had no borrowings outstanding under the Revolving Facility.

The Revolving Facility has a maturity date of February 9, 2027, and includes, at the sole discretion of the Operating Partnership, two six-month extension options.

Prior to prepayment, the Term Loan had a maturity date of February 8, 2026.

The Second Amended Credit Facility is guaranteed, jointly and severally, by the Company and its wholly owned subsidiaries that are party to the Second Amended Credit Agreement (other than the Operating Partnership).

The Second Amended Credit Agreement contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of the Company and its subsidiaries to grant liens on their assets, incur indebtedness, sell assets, make investments, engage in acquisitions, mergers or consolidations, amend organizational documents and pay certain dividends and other restricted payments.

The Second Amended Credit Agreement requires the Company to comply with financial maintenance covenants to be tested quarterly, consisting of a maximum debt to asset value ratio, a minimum fixed charge coverage ratio, a minimum tangible net worth, a maximum cash distributions to operating income ratio, a maximum secured debt to asset value ratio, a maximum secured recourse debt to asset value ratio, a maximum unsecured debt to unencumbered properties asset value ratio, a minimum unsecured interest coverage ratio and a minimum rent coverage ratio.

The Second Amended Credit Agreement also contains certain customary events of default, including the failure to make timely payments under the Second Amended Credit Facility or other material indebtedness, the failure to satisfy certain covenants (including the financial maintenance covenants), the occurrence of change of control and specified events of bankruptcy and insolvency.

As of September 30, 2024, the Company was in compliance with all applicable financial covenants under the Second Amended Credit Agreement.

Secured Borrowing

On June 3, 2024, KeyBank National Association purchased a $ 75.0 million undivided participation interest in a $ 165.0 million mortgage loan from the Company (see Note 5, Other Real Estate Related and Other Investments , for additional information), which bore interest at a rate of SOFR, with a term SOFR floor of 3.00 %, plus 2.5 % or 2.25 %, depending on the debt yield of the loan, and payable monthly.

As the transaction did not qualify as a sale in accordance with GAAP, the Company recorded the participation interest as a secured borrowing in the amount of $ 75.0 million in the condensed consolidated balance sheet.

The participating interest could be prepaid in whole before the maturity date for an exit fee of up to 0.50 % of the loan plus unpaid interest .

The participation interest provided for a put option, subject to certain restrictions, and a call option for the then-outstanding loan amount plus accrued and unpaid interest.

On July 30, 2024, the Company exercised the call option on the $ 75.0 million secured borrowing and recorded a loss on extinguishment of debt of $ 0.4 million related to the exit fee.

The exit fee is included in loss on extinguishment of debt in the condensed consolidated income statements.

At-The-Market Offering —On August 29, 2024, the Company entered into a new equity distribution agreement to issue and sell, from time to time, up to $ 750.0 million in aggregate offering price of its common stock through an “at-the-market” equity offering program (the “New ATM Program”) and terminated its previous $ 500.0 million “at-the-market” equity offering program (together, with all previous at-the-market equity offering programs, the “Previous ATM Programs” and together with the New ATM Program, the “ATM Program”).

The interest rates applicable to loans under the Third Amended Revolving Facility are, at the Operating Partnership’s option, equal to either a base rate plus a margin ranging from 0.05 % to 0.55 % per annum or Adjusted Term SOFR or Adjusted Daily Simple SOFR (each as defined in the Third Amended Credit Agreement) plus a margin ranging from 1.05 % to 1.55 % per annum based on the debt to asset value ratio of the Company and its consolidated subsidiaries (subject to decrease at the Operating Partnership’s election if the Company obtains certain specified investment grade ratings on its senior long-term unsecured debt).

In addition, the Operating Partnership will pay a facility fee on the revolving commitments under the Third Amended Revolving Facility ranging from 0.15 % to 0.35 % per annum, based on the debt to asset value ratio of the Company and its consolidated subsidiaries (unless the Company obtains certain specified investment grade ratings on its senior long-term unsecured debt and the Operating Partnership elects to decrease the applicable margin as described above, in which case the Operating Partnership will pay a facility fee on the revolving commitments ranging from 0.125 % to 0.30 % per annum based on the credit ratings of the Company’s senior long-term unsecured debt).

As of March 31, 2025, the Operating Partnership had borrowings outstanding of $ 425.0 million under the Third Amended Revolving Facility.

The Third Amended Revolving Facility has a maturity date of February 9, 2029, and includes, at the sole discretion of the Operating Partnership, two six-month extension options.

The Third Amended Credit Facility is guaranteed, jointly and severally, by the Company and its wholly owned subsidiaries that are party to the Third Amended Credit Agreement (other than the Operating Partnership).

The Third Amended Credit Agreement contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of the Company and its subsidiaries to grant liens on their assets, incur indebtedness, sell assets, make investments, engage in acquisitions, mergers or consolidations, amend organizational documents and pay certain dividends and other restricted payments.

The Third Amended Credit Agreement requires the Company to comply with financial maintenance covenants to be tested quarterly, consisting of a maximum debt to asset value ratio, a minimum fixed charge coverage ratio, a minimum tangible net worth, a maximum secured debt to asset value ratio, a maximum unsecured debt to unencumbered properties asset value ratio and a minimum unsecured interest coverage ratio.

The Third Amended Credit Agreement also contains certain customary events of default, including the failure to make timely payments under the Third Amended Credit Facility or other material indebtedness, the failure to satisfy certain covenants (including the financial maintenance covenants), the occurrence of change of control and specified events of bankruptcy and insolvency.

As of March 31, 2025, the Company was in compliance with all applicable financial covenants under the Third Amended Credit Agreement.

EQUITY AND REDEEMABLE NONCONTROLLING INTEREST

At-The-Market Offering —On January 21, 2025, the Company entered into a new equity distribution agreement to issue and sell, from time to time, up to $ 750.0 million in aggregate offering price of its common stock through an “at-the-market” equity offering program (the “New ATM Program”) and terminated its previous $ 750.0 million “at-the-market” equity offering program (together, with all previous at-the-market equity offering programs, the “Previous ATM Programs” and together with the New ATM Program, the “ATM Program”).

In addition to the issuance and sale of shares of its common stock, the ATM Program also provides for the ability to enter into one or more forward sales agreements (each, an “ATM forward contract”) with sales agents for the sale of the Company’s shares of common stock under the ATM Program.

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The weighted average forward sale price that the Company would expect to receive upon physical settlement would be subject to adjustment for (i) a floating interest rate factor equal to a specified daily rate less a spread, (ii) the forward purchaser’s stock borrowing costs and (iii) scheduled dividends through the settlement.

The following table summarizes the ATM Program activity for the three and nine months ended September 30, 2024 and 2023 (in thousands, except per share amounts):

For the Three Months Ended For the Nine Months Ended

September 30, 2024

September 30, 2023 September 30, 2024

September 30, 2023

The following table summarizes the ATM Program activity (or activity under any predecessor at-the-market equity offering programs) for the three months ended March 31, 2025 and 2024 (in thousands, except per share amounts):

For the Three Months Ended

March 31, 2025

March 31, 2024

Number of shares 553 11,600

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$ 15,964 $ 273,233

(1) Total gross proceeds is before $ 6.2 million and $ 4.0 million of commissions paid to the sales agents and forward adjustments during the three months ended September 30, 2024 and 2023, respectively, under the ATM Program.

Total gross proceeds is before $ 13.4 million and $ 4.0 million of commissions paid to the sales agents and forward adjustments during the nine months ended September 30, 2024 and 2023, respectively, under the ATM Program.

During the three and nine months ended September 30, 2023, the Company entered into ATM forward contracts under the ATM Program with a financial institution acting as a forward purchaser to sell 9,058,140 and 15,794,229 shares of common stock, respectively, at a weighted average initial sales price of $ 19.99 and $ 19.87 per share, respectively, before commissions and offering expenses.

During the three months ended September 30, 2023, the Company settled 10,893,229 shares outstanding under the ATM forward contracts at a weighted average sales price of $ 19.57 for net proceeds of $ 213.1 million.

No forward equity sales were executed or settled under the ATM Program during the three and nine months ended September 30, 2024, and there were no outstanding ATM forward contracts that had not settled as of September 30, 2024.

As of September 30, 2024, the Company had $ 440.1 million available for future issuances under the New ATM Program.

Dividends on Common Stock — The following table summarizes the cash dividends per share of common stock declared by the Company’s board of directors for the first nine months of 2024 (dollars in thousands, except per share amounts):

(1) Total gross proceeds is before $ 0.2 million and $ 3.4 million of commissions paid to the sales agents during the three months ended March 31, 2025 and 2024, respectively, under the ATM Program.

As of March 31, 2025, the Company had $ 734.0 million available for future issuances under the New ATM Program.

Dividends on Common Stock — The following table summarizes the cash dividends per share of common stock declared by the Company’s board of directors for the first three months of 2025 (dollars in thousands, except per share amounts):

For the Three Months Ended

March 31, 2024 June 30, 2024 September 30, 2024

March 31, 2025

Dividends declared per share $ 0.335

Dividends payment date April 15, 2024 July 15, 2024 October 15, 2024

Dividends payment date April 15, 2025

Dividends payable as of record date $ 63,053

Dividends record date March 28, 2024 June 28, 2024 September 30, 2024

Dividends record date March 31, 2025

Redeemable Noncontrolling Interest

Arrangements with noncontrolling interest holders are assessed for appropriate balance sheet classification based on the redemption and other rights held by the noncontrolling interest holder.

One of the Company’s noncontrolling interest holders has the ability to put its equity interest to the Company during specified option exercise periods, subject to certain conditions.

The put option is payable in cash and subject to changes in redemption value.

Accordingly, the Company records the redeemable noncontrolling interest outside of permanent equity.

The redeemable noncontrolling interest is adjusted for additional contributions and distributions and the proportionate share of the net earnings or losses.

When the redemption of the noncontrolling interest becomes probable, the Company will record the redeemable noncontrolling interest at the greater of its carrying amount or redemption value at the end of each reporting period by making an election either to accrete changes in the redemption value of the redeemable noncontrolling interest over the period from the date it is probable of exercise to the earliest redemption date or to recognize the entire adjustment on the date redemption becomes probable.

In addition to the rights of the redeemable noncontrolling interest holder, the Company has the ability to call the interest of the noncontrolling interest holder during specified option exercise periods.

As of March 31, 2025, the redeemable noncontrolling interest did not meet the conditions for redemption.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

STOCK-BASED COMPENSATION

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Under the Plan, 5,000,000 shares have been authorized for awards.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Under the Plan, restricted stock awards (“RSAs”) vest in equal annual installments over a three year period for the RSAs granted after 2020 and a four year period for the RSAs granted in 2020.

Under the Plan, restricted stock awards (“RSAs”) typically vest in equal annual installments over a three year period.

The board of directors granted certain RSAs in 2025 (“2025 RSAs”) which vest in one installment over one year .

RSAs granted to non-employee members of the board of directors (“Board Awards”) vest in full on the earlier to occur of the Company’s next Annual Meeting of Stockholders or one year .

Performance stock awards (“PSAs”) granted were subject to both time and performance based conditions and vested over a one -to- three year period for PSAs granted in 2021 and over a one -to- four year period for PSAs granted in 2020.

The amount of such PSAs that ultimately vested was dependent on the Company’s Normalized Funds from Operations (“NFFO”) per share, as defined by the Compensation Committee, meeting or exceeding a specified per share amount for the applicable vesting period.

Relative total shareholder return units (“TSR Units”) granted are subject to both time and market based conditions and cliff vest after a three-year period.

Relative total shareholder return units (“TSR Units”) granted since 2021 are subject to both time and market based conditions and cliff vest after a three-year period.

The amount of such market awards that will ultimately vest is dependent on the Company’s total shareholder return (“TSR”) performance relative to a custom TSR peer group consisting of other publicly traded healthcare REITs and will range from 0 % to 200 % of the TSR Units initially granted.

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The vesting of certain awards may accelerate, as defined in the grant agreement, upon retirement, a change in control or other events.

The following table summarizes the status of the restricted stock award and performance award activity for the nine months ended September 30, 2024 :

The following table summarizes the status of the restricted stock award activity for the three months ended March 31, 2025 :

Shares Weighted Average Share Price

Unvested balance at December 31, 2024 552,999 $ 23.86

Board Awards 21,712 23.95

RSAs 137,920 27.17

Vested ( 145,951 ) 21.16

Forfeited ( 35,161 ) 20.48

Unvested balance at September 30, 2024 327,336 $ 21.43

As of September 30, 2024, the weighted-average remaining vesting period of such award s was 1.5 years.

Unvested balance at March 31, 2025 544,968 $ 25.42

As of March 31, 2025, the weighted-average remaining vesting period of such award s was 2.0 years.

The following table summarizes the stock-based compensation expense recognized for the periods presented (dollars in thousands):

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2024 2023 2024 2023

For the Three Months Ended March 31,

Stock-based compensation expense $ 3,909 $ 2,120

For the nine months ended September 30, 2023, approximately $ 0.6 million of previously recognized stock-based compensation expense related to the PSAs was reversed as the awards were not expected to meet the performance conditions.

For the nine months ended September 30, 2023, approximately $ 0.9 million of previously recognized stock-based compensation expense was reversed due to forfeitures of stock awards.

As of September 30, 2024, there was $ 6.3 million of unamortized stock-based compensation expense related to the unvested RSAs and TSR Units.

As of March 31, 2025, there was $ 15.8 million of unamortized stock-based compensation expense related to the unvested RSAs and TSR Units.

CARETRUST REIT, INC.

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The following table presents the calculation of basic and diluted earnings per common share attributable to CareTrust REIT, Inc.

(“EPS”) for the Company’s common stock for the three and nine months ended September 30, 2024 and 2023, and reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS (dollars and shares in thousands, except per share amounts):

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2024 2023 2024 2023

(“EPS”) for the Company’s common stock for the three months ended March 31, 2025 and 2024, and reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS (dollars and shares in thousands, except per share amounts):

For the Three Months Ended March 31,

Net income attributable to CareTrust REIT, Inc.

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Dilutive potential common shares - TSR Units 264 366

Dilutive potential common shares - forward equity agreements — 99 — 42

Weighted-average diluted common shares outstanding 187,416 133,202

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Earnings per common share attributable to CareTrust REIT, Inc., diluted $ 0.35 $ 0.22

Antidilutive unvested RSAs, TSR Units and PSAs excluded from the computation (1)

Antidilutive unvested RSAs excluded from the computation (1)

(1) For the three months ended March 31, 2025 and 2024, RSAs are antidilutive.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

SEGMENT REPORTING

The Company represents a single reportable segment, based on how its chief operating decision maker (“CODM”) evaluates the businesses and allocates resources.

The CODM assesses performance for the Company and decides how to allocate resources based on consolidated net income that is also reported on the condensed consolidated income statements.

The CODM does not review segment assets at a different asset level or category than the amounts disclosed in the condensed consolidated balance sheets.

The CODM uses net income to evaluate the performance of the Company in deciding whether to reinvest profits into the Company.

The CODM evaluates performance based on net income, as follows (in thousands):

For the Three Months Ended March 31,

Rental income $ 71,646 $ 53,502

Interest income from financing receivable 2,807 —

Interest income from other real estate related investments and other income 22,168 9,568

Total revenues 96,621 63,070

Depreciation and amortization 17,841 13,448

Interest expense 6,669 8,228

Property taxes 2,065 1,801

Impairment of real estate investments — 2,744

Transaction costs 888 —

Property operating expenses 105 660

General and administrative

Cash compensation 2,090 1,765

Incentive compensation 1,225 1,500

Share-based compensation 3,909 2,120

Professional services 876 738

Taxes and insurance 218 205

Other expenses (1)

Total general and administrative 9,023 6,838

Total expenses 36,591 33,719

Other income (loss):

Gain on sale of real estate, net 3,876 11

Unrealized gain (loss) on other real estate related investments, net 1,287 ( 612 )

Total other income (loss) 5,163 ( 601 )

Net income 65,193 28,750

Net (loss) income attributable to noncontrolling interests ( 609 ) 4

Net income attributable to CareTrust REIT, Inc.

$ 65,802 $ 28,746

(1) For the three and nine months ended September 30, 2024, RSAs are antidilutive.

For the three months ended September 30, 2023, RSAs were antidilutive.

For the nine months ended September 30, 2023, RSAs and certain TSR Units were antidilutive.

VARIABLE INTEREST ENTITIES

Noncontrolling Interests —The Company has entered into multiple ventures with unrelated third parties to own real estate and has concluded that such ventures are VIEs.

As the Company exercises power over and receives economic benefits from the VIEs, the Company is considered the primary beneficiary and consolidates the VIEs.

Pursuant to the Company’s joint ventures (“JVs”), the Company typically contributes 97.5 % of the JV’s total investment amount and the Company receives 100 % of the preferred equity interest in the JV in exchange for 95 % of that total investment and a 50 % common equity interest in the JV in exchange for the remaining 2.5 % of that investment.

The JV partner contributes the remaining 2.5 % of the JV’s total investment amount in exchange for a 50 % common ownership interest in the JV.

As of September 30, 2024, the Company held four SNFs, two multi-service campuses and one ALF in multiple VIEs.

On January 3, 2024, the Company entered into a JV, pursuant to which the Company contributed $ 10.8 million into the JV that purchased one ALF located in California for $ 11.0 million.

The JV partner contributed the remaining $ 0.2 million of the total investment.

On April 1, 2024, the Company entered into a JV, pursuant to which the Company contributed $ 28.1 million into the JV that purchased two multi-service campuses located in California for $ 28.8 million.

The JV partner contributed the remaining $ 0.7 million of the total investment.

(1) Other expenses include certain overhead expenses.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

On August 7, 2024, the Company entered into a JV, pursuant to which the Company contributed $ 24.5 million into the JV that purchased one SNF located in California for $ 25.1 million.

The JV partner contributed the remaining $ 0.6 million of the total investment.

VARIABLE INTEREST ENTITIES

Noncontrolling Interests —The Company has entered into ventures with unrelated third parties to own real estate and has concluded that such ventures are VIEs.

As the Company exercises power over and receives economic benefits from the VIEs, the Company is considered the primary beneficiary and consolidates the VIEs.

The following table summarizes the contributions to joint ventures that are consolidated variable interest entities through March 31, 2025 (dollars in thousands):

Gross Investment

Investment Year State Facility Type Number of Facilities CTRE Noncontrolling Interests Total

2023 CA SNF 1 $ 25,459 $ 653 $ 26,112

2023 CA SNF 2 34,269 879 35,148

2024 CA ALF 1 10,760 276 11,036

2024 CA Multi-service campuses 2 28,076 720 28,796

2024 CA SNF 1 24,503 628 25,131

2024 / 2025 (1)

TN, AL SNF 28 442,327 19,156 461,483

2024 / 2025 (2)

- - - 33,663 867 34,530

Total 35 $ 599,057 $ 23,179 $ 622,236

(1) The noncontrolling interest is classified as a redeemable noncontrolling interest on the consolidated balance sheets.

(2) The Company entered into a joint venture to acquire real estate.

The gross investment amounts represent a deposit.

See Note 15, Subsequent Events, for additional information.

Pursuant to the Company’s joint ventures (“JVs”), the Company typically contributes at least 90 % of the JV’s total investment amount and receives 100 % of the preferred equity interest in the JV and a 50 % common equity interest in the JV.

The Company’s JV partner contributes the remaining total investment amount in exchange for a 50 % common equity interest in the JV.

Total assets and total liabilities include VIE assets and liabilities as follows (dollars in thousands):

September 30, 2024

March 31, 2025

December 31, 2024

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Claims and lawsuits may include matters involving general or professional liability asserted against the Company’s tenants, which are the responsibility of the Company’s tenants and for which the Company is entitled to be indemnified by its tenants under the insurance and indemnification provisions in the applicable leases.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

In the normal course of business, the Company enters into various commitments, typically consisting of funding of capital expenditures and short-term working capital loans to existing tenants while they await licensure and certification or are conducting turnaround work in one or more of the Company’s properties.

Capital expenditures for each property leased under the Company’s triple-net leases are generally the responsibility of the tenant, except for the facilities leased under certain master lease agreements, with subsidiaries of Ensign and Pennant, under which the tenant will have an option to require the Company to finance certain capital expenditures up to an aggregate of 20 % of the Company’s initial investment in such property, subject to a corresponding rent increase at the time of funding.

Capital expenditures for each property leased under the Company’s triple-net leases are generally the responsibility of the tenant, except for the facilities leased under certain master lease agreements, with certain subsidiaries of Ensign and Pennant, under which the tenant will have an option to require the Company to finance certain capital expenditures up to an aggregate of 20 % of the Company’s initial investment in such property, subject to a corresponding rent increase at the time of funding.

For the Company’s other triple-net master leases, the tenants also have the option to request capital expenditure funding that would generally be subject to a corresponding rent increase at the time of funding, which are subject to tenant compliance with the conditions to the Company’s approval and funding of their requests.

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The Company’s board of directors has authorized annual allocations of up to $ 500,000 to fund the Tenant ESG Program.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

The table below summarizes the Company’s existing, known commitments and contingencies as of September 30, 2024 (in thousands):

The table below summarizes the Company’s existing, known commitments and contingencies as of March 31, 2025 (in thousands):

Remaining Commitment

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Earn-out obligation (4)

(1) As of September 30, 2024, the Company had committed to fund expansions, construction, capital improvements and ESG incentives at certain triple-net leased facilities totaling $ 14.8 million, of which $ 7.2 million is subject to rent increase at the time of funding.

(2) One mortgage loan includes an earn-out advance upon satisfaction of certain conditions.

On October 11, 2024, these conditions were satisfied and the earn-out was funded.

(3) Represents working capital loan commitments.

(1) As of March 31, 2025, the Company had committed to fund expansions, construction, capital improvements and ESG incentives at certain triple-net leased facilities totaling $ 7.2 million, of which $ 6.3 million is subject to rent increase at the time of funding.

(2) Includes an earn-out advance of $ 9.0 million related to one mortgage loan, upon satisfaction of certain conditions.

(3) Represents non-real estate secured loan commitments.

(4) Includes an earn-out obligation of up to $ 10.0 million under a purchase and sale agreement for one SNF in Virginia, which was acquired during 2024.

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Concentrations of credit risk arise when one or more tenants, operators, or obligors related to the Company’s investments are engaged in similar business activities or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions.

Major operator concentration – The Company has operators from which it derived 10% or more of its revenue for the three and nine months ended September 30, 2024 and 2023.

The following table sets forth information regarding the Company’s major operators as of September 30, 2024 and 2023:

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Major operator concentration – The Company has operators from which it derived 10% or more of its revenue for the three months ended March 31, 2025 and 2024.

The following table sets forth information regarding the Company’s major operators as of March 31, 2025 and 2024:

Number of Facilities Number of Beds/Units Percentage of Total Revenue

Operator/Borrower SNF Campus ALF/ILF SNF Campus ALF/ILF Three Months Ended Nine Months Ended

September 30, 2024 (1)

Operator/Borrower SNF Campus ALF/ILF SNF Campus ALF/ILF Three Months Ended

March 31, 2025 (1)

89 7 7 9,288 843 661 21 %

Priority Management Group 13 2 — 1,742 402 — 11 % 12 %

September 30, 2023 (2)

23 3 — 2,809 322 — 11 %

March 31, 2024 (1)

85 8 7 9,024 997 661 30 %

Priority Management Group 13 2 — 1,742 402 — 13 %

(1) The Company’s rental income and interest income on other real estate related investments, exclusive of operating expense reimbursements.

(2) The Company’s rental income, exclusive of operating expense reimbursements.

(3) Ensign is subject to the registration and reporting requirements of the SEC and is required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information.

Ensign’s financial statements, as filed with the SEC, can be found at http://www.sec.gov.

(2) Ensign and the PACS Group, Inc.

(“PACS”) are subject to the registration and reporting requirements of the SEC and are required to file with the SEC annual reports containing audited financial information and quarterly reports containing unaudited financial information.

Ensign and PACS’s financial statements, as filed with the SEC, can be found at http://www.sec.gov.

The Company has not verified this information through an independent investigation or otherwise.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

Major geographic concentration – The following table provides information regarding the Company’s concentrations with respect to certain states, from which the Company derived 10% or more of its revenue for the three and nine months ended September 30, 2024 and 2023:

Number of Facilities Number of Beds/Units Percentage of Total Revenue

State SNF Campus ALF/ILF SNF Campus ALF/ILF Three Months Ended Nine Months Ended

September 30, 2024 (1)

State SNF Campus ALF/ILF SNF Campus ALF/ILF Three Months Ended

March 31, 2025 (1)

CA 42 12 11 4,979 2,004 1,032 23 %

TX 38 3 2 4,772 476 212 12 %

September 30, 2023 (2)

TN 29 — — 3,098 — — 12 %

March 31, 2024 (1)

CA 42 9 9 5,000 1,527 723 31 %

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(1) Based on the Company’s rental income and interest income on other real estate related investments, exclusive of operating expense reimbursements.

(2) Based on the Company’s rental income, exclusive of operating expense reimbursements.

SUBSEQUENT EVENTS

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Recent Acquisitions

On October 1, 2024, the Company acquired two SNFs and one multi-service campus in Maryland for $ 55.5 million, which includes estimated capitalized acquisition costs.

In connection with the acquisition of the facilities, the Company entered into a new master lease with a skilled nursing operator.

The new master lease has an initial term of approximately 15 years, with two five-year renewal options and CPI-based rent escalators.

Initial annual cash rent under the new master lease is $ 5.2 million.

Recent Investments

On October 1, 2024, and in connection with the $ 55.5 million skilled nursing acquisition described above, the Company extended a $ 19.2 million mortgage loan to a skilled nursing operator.

The loan is secured by a first priority ground leasehold mortgage lien on a SNF located in Maryland and bears interest at an initial annual rate of 9.35 % with annual CPI-based escalators, payable monthly.

The mortgage loan has a term of 15 years and is set to mature on September 30, 2039, with two five-year extension options.

The mortgage loan provides for a put option, giving the borrower the right to require the lender to purchase the underlying ground leasehold and property associated with the mortgage loan.

The exercise window for the put option is 30 days prior to the maturity date.

The mortgage loan also provides for a purchase option in favor of the Company (subject to certain requirements) with two exercise windows.

The first exercise window is on or before October 1, 2026.

The second purchase option window opens January 1, 2039, and remains open for 6 months.

On October 1, 2024, the Company extended a $ 9.8 million mortgage loan to a skilled nursing real estate owner.

The loan is secured by a first priority mortgage lien on a SNF located in Colorado and bears interest at a fixed rate of 8.5 %, payable monthly.

The mortgage loan is set to mature on September 30, 2034.

The mortgage provides a one-year extension option and may (subject to certain restrictions) be prepaid in whole, after the 18th month following the loan closing, for an exit fee ranging from 0 % to 2 % of the loan plus unpaid interest payments.

Entry into a Material Definitive Agreement

On October 29, 2024, in connection with a joint venture arrangement (the “Tennessee JV”) between the Operating Partnership and an unaffiliated third party, the Operating Partnership became bound by the terms of an Asset Purchase Agreement (the “Purchase Agreement”) pursuant to which the Tennessee JV has agreed to acquire 31 skilled nursing facilities (the “Tennessee SNF Facilities”) for an aggregate purchase price of approximately $ 500 million, exclusive of transaction costs.

In connection with the Tennessee JV’s acquisition of the Tennessee SNF Facilities, the Operating Partnership is expected to

On April 1, 2025, the Company purchased one multi-service campus in California for $ 34.7 million, inclusive of transaction costs, through a JV.

The Company contributed $ 33.8 million to the JV.

In exchange, the Company holds 100 % of the preferred equity interests in the JV and 50 % of the common equity interest in the JV.

The JV partner contributed the remaining $ 0.9 million of the total investment in exchange for 50 % of the common equity interest in the JV.

In connection with the acquisition of the facility, subsidiaries of the JV entered into a new master lease with affiliates of Ensign.

The master lease has an initial term of approximately 15 years, with two five-year renewal options.

Annual cash rent under the lease is $ 3.5 million, with annual CPI-based escalators.

See Note 12, Variable Interest Entities , for additional information.

CARETRUST REIT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —

contribute approximately $ 442 million toward the aggregate purchase price to the Tennessee JV and, in exchange, the Operating Partnership will own 100 % of the preferred equity ownership interests in the Tennessee JV representing 92.5 % of the total investment and 50 % of the common ownership interests in the Tennessee JV representing 3.75 % of the total investment.

The Tennessee SNF Facilities consist of a total of 3,290 licensed beds, with 30 of the facilities located in Tennessee and one in Alabama.

The Company has contributed $ 8.5 million to the Tennessee JV, which was used to partially fund the earnest money deposit under the Purchase Agreement.

Completion of the Tennessee JV’s acquisition of the Tennessee SNF Facilities is subject to customary closing conditions, and is expected to close in two phases during December 2024.

At closing, the Tennessee SNF Facilities are anticipated to be operated by affiliates of PACS Group, Inc.

( twelve facilities), Ensign ( nine facilities), and Links Healthcare Group ( seven facilities), who are all current tenants of the Company, as well as one new operator relationship ( three facilities), under long-term master leases.

Three of Ensign’s nine facilities will be acquired by Ensign’s real estate subsidiary with the remaining six to be included in a new master lease.

Initial annual base rent to the Tennessee JV relating to the Tennessee SNF Facilities is expected to aggregate approximately $ 44.4 million.

Mortgage Loan Prepayment

In April 2025, one mortgage loan with a principal balance of $ 2.9 million was fully prepaid, including all unpaid accrued interest.

At-The-Market Offering of Common Stock

In April 2025, the Company sold 3.4 million shares under the ATM Program for gross proceeds of $ 99.5 million at an average sales price per share of $ 28.90 .

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