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Item 2. Management’s Discussion and Analysis

2026-07-30 compared with 2026-04-29 · 178 added, 101 removed, 238 unchanged (54% of the section changed)

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(1) those items discussed under “Risk Factors” in Part I, Item 1A to our Annual Report on Form 10-K and Part II, Item 1A herein;

(2) uncertainties relating to the business operations of the operators of our assets, including those relating to reimbursement by third-party payors, regulatory matters, occupancy levels and quality of care, including the management of infectious diseases;

(2) uncertainties relating to the business operations of the operators of our Triple-Net assets and the managers of our Operating portfolio assets (collectively, our “operators”), including those relating to reimbursement by third-party payors, regulatory matters, occupancy levels and quality of care, including the management of infectious diseases;

(3) our operators’ ability to manage industry challenges, including staffing shortages, which may impact certain regions more acutely, increased costs, and the sufficiency of governmental reimbursement rates to offset such costs and the conditions related thereto;

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(12) changes in the financial position of our operators;

(13) the effect of economic, regulatory and market conditions generally and, particularly, in the healthcare industry in the United States and in other jurisdictions where we conduct business, including the United Kingdom;

(14) changes in interest rates and foreign currency exchange rates and the impact of inflation and changes in global tariffs and international trade disputes;

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(16) our ability to maintain our status as a REIT;

(17) operational risks associated with our investments in healthcare operating companies, including senior housing properties managed through structures authorized by the REIT Investment Diversification and Empowerment Act of 2007 (commonly referred to as “RIDEA”);

(17) operational risks, including management of regulatory requirements and operating expenses, associated with our investments in healthcare operating companies, including senior housing properties managed through structures authorized by the REIT Investment Diversification and Empowerment Act of 2007 (commonly referred to as “RIDEA”);

(18) the use of, or inability to use, artificial intelligence by us or our operators, managers, vendors and investors;

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● Government Regulation and Reimbursement

● First Quarter of 2026 and Recent Highlights

● Second Quarter of 2026 and Recent Highlights

● Results of Operations

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Omega is structured as an umbrella partnership REIT (“UPREIT”) under which all of Omega’s assets are owned directly or indirectly by, and all of Omega’s operations are conducted directly or indirectly through, its operating partnership subsidiary, OHI Healthcare Properties Limited Partnership (collectively with its subsidiaries, “Omega OP”).

As of March 31, 2026, Parent owned approximately 95% of the issued and outstanding units of partnership interest in Omega OP (“Omega OP Units”), and other investors owned approximately 5% of the outstanding Omega OP Units.

Omega has one reportable segment consisting of investments in healthcare-related real estate properties located in the United States (“U.S.”), the United Kingdom (“U.K.”) and Canada.

Our core business is to provide financing and capital to the long-term healthcare industry with a particular focus on SNFs, ALFs (including care homes in the U.K.), and to a lesser extent, independent living facilities (“ILFs”), rehabilitation and acute care facilities (“specialty facilities”) and continuing care retirement communities (“CCRCs”).

Our core portfolio consists of our long-term leases and real estate loans with healthcare operating companies and affiliates (collectively, our “operators”).

As of June 30, 2026, Parent owned approximately 96% of the issued and outstanding units of partnership interest in Omega OP (“Omega OP Units”), and other investors owned approximately 4% of the outstanding Omega OP Units.

We operate through two reportable segments, triple-net investments (“Triple-Net”) and operating portfolio (“Operating”).

Our investments in healthcare-related real estate properties, located in the United States (“U.S.”), the United Kingdom (“U.K.”) and Canada, include SNFs, ALFs (including care homes in the U.K.), and to a lesser extent, independent living facilities (“ILFs”), rehabilitation and acute care facilities (“specialty facilities”) and continuing care retirement communities (“CCRCs”).

In our Triple-Net segment, our revenues primarily relate to triple-net leases with third-party operators at our properties.

Additionally in our Triple-Net segment, we recognize interest income from real estate loans and non-real estate loans we provide to our operators, affiliates and/or their principals.

Real estate loans consist of mortgage loans and other real estate loans that are primarily collateralized by a first, second or third mortgage lien or a leasehold mortgage on, or an assignment of the partnership interest in the related properties.

Additionally, during the fourth quarter of 2025, we began utilizing the structure authorized by the REIT Investment Diversification and Empowerment Act of 2007 (commonly referred to as “RIDEA”), whereby we own and operate healthcare facilities through third-party managers (collectively, our “managers”).

In addition to our core investments, we make loans to operators and/or their principals.

These loans, which may be either unsecured or secured by the collateral of the borrower, are classified as non-real estate loans.

Non-real estate loans may be either unsecured or secured by the collateral of the borrower.

Additionally, during the fourth quarter of 2025, we began utilizing the structure authorized by the REIT Investment Diversification and Empowerment Act of 2007 (commonly referred to as “RIDEA”), whereby we own and operate senior healthcare facilities in our Operating segment through third-party managers (collectively, our “managers”).

We utilize managers to operate these properties on our behalf and pay a management fee for these services.

From time to time, we also acquire equity interests in joint ventures (“JVs”) or entities that support the long-term healthcare industry and our operators, which may include ancillary service or technology companies, and in operating companies.

These JVs are categorized into our Triple-Net segment or our Operating segment based on the structure of the JV operations.

As healthcare delivery continues to evolve, we continuously evaluate potential investments, our assets, operators and markets to position our portfolio for long-term success.

As part of our evaluation, we may from time to time consider selling or transitioning assets that do not meet our portfolio criteria.

The following table summarizes our portfolio for the three months ended June 30, 2026 (dollars in thousands):

Type of Property

Outlook, Trends and Other Conditions

Our operators continue to face a number of industry challenges, including staffing shortages in certain regions, which have persisted since the COVID-19 pandemic.

In addition, our operators have been and continue to be adversely affected by inflation-related cost increases and may be adversely impacted by recently announced global tariffs, each of which may increase expenses, exacerbate labor shortages and increase labor costs, among other adverse impacts.

Our operators also may be adversely impacted by immigration restrictions and changes to immigration enforcement policy to the extent they contribute to labor shortages.

Our operators continue to face a number of industry challenges, including staffing shortages in certain regions and inflation-related cost increases.

These challenges may be exacerbated by global tariffs and immigration restrictions, each of which may increase expenses, worsen labor shortages and increase labor costs, among other adverse impacts.

There continues to be uncertainty regarding the extent and duration of these impacts for those operators, particularly given uncertainty as to whether reimbursement increases from the federal government, the states and the U.K.

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The healthcare industry is heavily regulated.

Our healthcare facility operators (which include our TRS entities and their managers when we use a RIDEA structure) are subject to extensive and complex federal, state and local healthcare laws and regulations in the U.S., where most of our operators are located, and in the U.K.

Our healthcare facility operators (which include managers in our Operating segment) are subject to extensive and complex federal, state and local healthcare laws and regulations in the U.S., where most of our operators are located, and in the U.K.

and Canada relating to quality of care, licensure and certificate of need, resident rights (including abuse and neglect), consumer protection, government reimbursement, fraud and abuse compliance and similar laws governing the operation of healthcare facilities.

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There is the potential that in our Triple-Net business we may be subject directly to healthcare laws and regulations because of the broad nature of some of these regulations, such as the Anti-kickback Statute and False Claims Act in the U.S., among others.

Moreover, given that certain of our arrangements are structured under RIDEA, certain healthcare fraud and abuse and data privacy laws, including those related to personal health information, could apply directly to us.

Moreover, in our Operating portfolio, certain healthcare fraud and abuse and data privacy laws, including those related to personal health information, could apply directly to us.

The long-term care industry continues to manage a number of challenges, including staffing shortages, which may impact certain regions more acutely, and certain expense and inflationary cost increases, all of which have persisted since the pandemic.

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Congressional majorities at the federal level have increased the political focus on entitlement program changes and created additional uncertainty with respect to the level of government reimbursement available and the extent of industry regulation.

The July 2025 passage of the OBBBA enacted significant reforms regarding funding and operation of the Medicaid program, including an estimated $920 billion in cuts to Medicaid over the next decade, as well as additional reforms related to enactment of new home and community-based services (“HCBS”) waivers;

and freezing, rather than reducing, nursing home provider taxes.

The OBBBA’s restrictions on provider taxes to other types of healthcare providers may adversely impact our operators indirectly to the extent states reduce reimbursement levels generally to offset general provider tax reductions.

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The following is a discussion of certain U.S.

laws and regulations generally applicable to our operators, and in certain cases, to us.

laws and regulations generally applicable to our operators and managers, and in certain cases, to us, including in connection with our investments in our Operating segment through RIDEA structures.

Quality of Care and Staffing Initiatives .

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senators have proposed legislation and conducted oversight initiatives that would, if enacted, restrict certain investors, including REITs and private equity firms, from investing in certain healthcare facilities, restrict such facilities’ receipt or use of funds received from government healthcare programs, increase financial transparency reporting obligations for such facilities and impose penalties on certain landlords or private equity investors in healthcare facilities whose operators subsequently enter into bankruptcy proceedings.

Additionally, in January 2025, the State of Massachusetts enacted a law that requires notification for certain transactions involving SNFs and REITs and restricts new licenses to hospitals with certain facilities leased from REITs.

At the state level, recent enacted laws in Massachusetts and Connecticut require notification and detailed ownership disclosures for certain transactions involving SNFs and REITs and restrict hospitals from entering into certain leasing transactions with REITs.

Legislation with similar or more restrictive provisions has been proposed in several other states.

In addition, a number of states have increased requirements for operators to disclose certain ownership and managerial information regarding their relationships with certain entities that lease real estate to SNFs, particularly in connection with change of ownership approvals by the state.

While the likelihood of any of these legislative measures passing at the federal level or in any additional U.S.

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Medicare reimbursement rate setting takes effect annually each October for the following fiscal year.

On July 31, 2025, CMS issued a final rule regarding the government fiscal year 2026 Medicare payment rates and quality payment programs for SNFs, with aggregate Medicare Part A payments projected to increase by $1.16 billion, or 3.2%, for fiscal year 2026 compared to fiscal year 2025.

This estimated reimbursement increase is attributable to a 3.2% net market basket update to the payment rates, which is based on a 3.3% SNF market basket increase plus a 0.6% market basket forecast error adjustment and less a 0.7% productivity adjustment.

On July 29, 2026, CMS issued a final rule regarding the government fiscal year 2027 Medicare payment rates and quality payment programs for SNFs, with aggregate Medicare Part A payments projected to increase by $882.7 million, or 2.4%, for fiscal year 2027 compared to fiscal year 2026.

This estimated reimbursement increase is attributable to a 2.4% net market basket update to the payment rates, which is based on a 3.3% SNF market basket increase less a 0.9% productivity adjustment.

The annual update is reduced by 2% for SNFs that fail to submit required quality data to CMS under the SNF Quality Reporting Program.

CMS has indicated that these impact figures did not incorporate the SNF Value-Based Program reductions that are estimated to be $208.36 million in fiscal year 2026.

CMS has indicated that these impact figures did not incorporate the SNF Value-Based Program reductions that are estimated to be $203.6 million in the aggregate in fiscal year 2027.

While Medicare reimbursement rate setting has historically included forecasted inflationary adjustments, the degree to which those forecasts accurately reflect current expense levels remains uncertain.

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Such enforcement activities are unpredictable and may develop over lengthy periods of time.

An adverse resolution of any of these enforcement activities or investigations incurred by our operators may involve injunctive relief and/or substantial monetary penalties, either or both of which could have a material adverse effect on their reputation, business, results of operations and cash flows.

CMS has also increased its focus on Medicaid and Medicare fraud and abuse activities across the healthcare industry, which in certain cases has included payment deferrals for services already rendered and the potential withholding of future federal funds administered to state Medicaid programs.

While to date these actions have primarily been focused on home health, hospice, and durable medical equipment providers, any payment deferrals or withholding of future funding may impact, and in some cases have impacted, state budgets and therefore may indirectly impact reimbursements to long-term care providers.

Further, it is unclear whether CMS will broaden its focus to additional healthcare providers or establish additional regulations and tools in which to combat fraud and abuse, in either case in a manner that directly impacts the long-term care industry.

Any such future actions aimed at our industry, or indirect impacts from current CMS fraud and abuse enforcement activity, depending on the scope and implementation, could have a material adverse effect on the reputation, business, results of operations and cash flows of our operators.

Licensing and Certification.

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Governmental agencies administering these laws and regulations regularly inspect our operators’ facilities and investigate complaints.

Our operators and their managers receive notices of observed violations and deficiencies from time to time, and sanctions have been imposed from time to time on facilities operated by them.

In our Triple-Net segment, our operators and their managers receive notices of observed violations and deficiencies from time to time, and sanctions have been imposed from time to time on facilities operated by them, which could involve monetary penalties or a change in operator or manager.

In our Operating segment, we or our managers could similarly be subject to such notices or sanctions.

In addition, many states require certain healthcare providers to obtain a certificate of need, which requires prior approval for the construction, expansion or closure of certain healthcare facilities, which has the potential to impact some of our operators’ abilities to expand or change their businesses.

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based target businesses, including the authority to investigate, delay, impose conditions on or prohibit transactions involving our U.K.

First Quarter of 2026 and Recent Highlights

● During the three months ended March 31, 2026, we acquired 15 facilities for aggregate consideration of $126.4 million, including one facility that we own and operate utilizing a RIDEA structure .

● We invested $12.8 million under our construction in progress and capital improvement programs during the three months ended March 31, 2026.

● We funded $21.3 million under one new real estate loan originated during 2026 with an interest rate of 13% during the three months ended March 31, 2026.

Additionally, we advanced $6.0 million under existing real estate loans during the three months ended March 31, 2026.

We received principal repayments of $17.3 million on real estate loans during the three months ended March 31, 2026.

● On January 1, 2026, Omega acquired a 9.9% equity interest in Saber Healthcare Holdings, LLC (“Saber”) for cash consideration of $92.8 million, including related transaction fees.

Saber is an operating company to which Omega leases 53 operating facilities under a master lease agreement for monthly contractual rent of $5.4 million as of March 31, 2026.

Saber also operates and leases 65 facilities held by SHH Holdings, LLC, a property holding company JV in which Omega owns a 49% equity interest.

Omega will receive minimum quarterly cash distributions equivalent to an annualized yield of 8% on this investment.

● During the three months ended March 31, 2026, we sold four SNFs for $34.5 million in net cash proceeds, recognizing a net gain of $3.0 million.

Second Quarter of 2026 and Recent Highlights

● During the three and six months ended June 30, 2026, we acquired eight facilities and 23 facilities for aggregate consideration of $109.9 million and $236.3 million, respectively, including four facilities and five facilities in our Operating segment .

● During the three and six months ended June 30, 2026, we invested $21.1 million and $33.8 million under our construction in progress and capital improvement programs in our Triple-Net segment, respectively, and we invested $0.6 million and $0.7 million under our construction in progress and capital improvement programs in our Operating segment.

● We funded $21.3 million under one new real estate loan originated during 2026 with an interest rate of 13.0% during the six months ended June 30, 2026.

Additionally, we advanced $16.4 million and $22.4 million under existing real estate loans during the three and six months ended June 30, 2026, respectively.

Principal repayments of $71.8 million and $89.1 million were received on real estate loans during the three and six months ended June 30, 2026, respectively.

● During the second quarter of 2026, SHH Holdings, LLC (“Saber PropCo”), a property holding company JV in which Omega owns a 49% equity interest, sold three SNFs (two of which were acquired by Omega) for $36.1 million.

Saber PropCo also acquired four SNFs (one of which was sold by Omega) in the second quarter of 2026 and five Ohio SNFs from a third party in July 2026.

The total aggregate consideration for all nine facilities acquired in the second quarter of 2026 and in July 2026 was $160.0 million.

The nine acquired facilities were subsequently leased to Saber Healthcare Holdings, LLC (“Saber”), an operating company in which Omega owns a 9.9% equity interest.

Following the acquisitions and sales in the second quarter of 2026 and July 2026, Saber PropCo owns 71 facilities subject to triple-net leases with Saber that generate $83.1 million in contractual rent per annum.

● During the second quarter of 2026, we transitioned a portfolio of 18 facilities from another operator to Saber’s master lease, increasing the total number of facilities under our master lease with Saber to 69 facilities and resulting in monthly contractual rent of $7.7 million in July 2026 following the transitions.

● During the three and six months ended June 30, 2026, we sold 26 facilities (22 SNFs and four ALFs) and 30 facilities (26 SNFs and four ALFs) in our Triple-Net segment for total consideration of $562.6 million and $597.1 million, respectively, of which $37.4 million was in the form of seller financing.

As a result of these sales, we recognized a net gain of $246.5 million and $249.5 million for the periods, respectively.

● During the three and six months ended June 30, 2026, we recorded impairments of zero and $0.4 million, respectively, related to facilities in our Triple-Net segment.

Financing Activities

● During the three months ended March 31, 2026, we sold 2.2 million shares of common stock under our $2.0 billion At-The-Market Offering Program (“ATM Program”) and Dividend Reinvestment and Common Stock Purchase Plan (“DRCSPP”), generating aggregate gross proceeds of $107.1 million.

● During the three and six months ended June 30, 2026, we sold 1.3 million and 3.5 million shares, respectively, of common stock under our $2.0 billion At-The-Market Offering Program (“ATM Program”) and Dividend Reinvestment and Common Stock Purchase Plan (“DRCSPP”), generating aggregate gross proceeds of $62.0 million and $169.1 million, respectively.

Other Highlights

● We funded $29.7 million under six new non-real estate loans originated during 2026 with a weighted average interest rate of 10.8% during the three months ended March 31, 2026.

We advanced $4.7 million under existing non-real estate loans during the three months ended March 31, 2026.

Principal repayments of $17.9 million were received on non-real estate loans during the three months ended March 31, 2026.

● We funded $29.7 million under six new non-real estate loans originated during 2026 with a weighted average interest rate of 10.8% during the six months ended June 30, 2026.

We advanced $8.5 million and $13.2 million under existing non-real estate loans during the three and six months ended June 30, 2026, respectively.

Principal repayments of $99.2 million and $117.2 million were received on non-real estate loans during the three and six months ended June 30, 2026, respectively.

Collectibility Issues

● During the three months ended March 31, 2026, we had a $2.4 million straight-line receivable write-off as a result of placing one operator lease on a cash basis of revenue recognition.

As of March 31, 2026, 20 operators are on a cash basis of rental revenue recognition.

These operators represent 21.8% of our total revenues for the three months ended March 31, 2026.

● We recognized rental income of $19.4 million related to our leases with Maplewood Senior Living (along with its affiliates, “Maplewood”) during the three months ended March 31, 2026.

Maplewood elected to defer $3.6 million of contractual rent under its 17-facility lease during the three months ended March 31, 2026.

● During the three and six months ended June 30, 2026, we had zero and $2.4 million of straight-line receivable write-offs as a result of placing two and three operator leases on a cash basis of revenue recognition, respectively.

The two operators placed on a cash basis of revenue recognition during the second quarter of 2026 are new operators leasing facilities that were recently acquired through foreclosure.

As of June 30, 2026, 22 operators are on a cash basis of rental revenue recognition.

These operators represent 22.2% of our total revenues for the six months ended June 30, 2026.

● We recognized rental income of $19.6 million and $39.0 million related to our leases with Maplewood Senior Living (along with its affiliates, “Maplewood”) during the three and six months ended June 30, 2026, respectively.

The amount of unpaid contractual rent that was deferred, as allowable under the terms of its the Maplewood Master Lease, was $3.5 million and $7.1 million for the three and six months ended June 30, 2026, respectively (see Note 4 – Contractual and Other Receivables for a breakdown of total Maplewood rental income by lease).

Deferred rent bears interest at 5% per annum if outstanding longer than 18 months, which is reflected in rental income when received.

No interest income was recorded on the revolving credit facility with Maplewood during the three months ended March 31, 2026.

As of June 30, 2026, the outstanding deferred rent balance is $56.6 million.

No interest income was recorded on the revolving credit facility with Maplewood during the three and six months ended June 30, 2026.

Maplewood is on a cash basis of revenue recognition for lease purposes and non-accrual status for loan purposes as a result of liquidity issues beginning in 2023, so rental revenue and interest income is only recorded for contractual rent and interest payments that are received from Maplewood.

In April 2026, Maplewood paid $6.5 million under its lease agreements, $1.3 million of which relates to the single-facility lease for Inspir Embassy Row in Washington, D.C..

● In March 2026, we agreed to provide $26.7 million of an $80.0 million DIP loan to Genesis Healthcare, Inc.

(“Genesis”), which was used to repay the original DIP Loan and administrative costs associated with their on-going bankruptcy proceedings.

We recognized full contractual rental income of $13.3 million related to Genesis during the three months ended March 31, 2026.

In addition, we recognized interest income of $7.0 million related to loans with Genesis during the three months ended March 31, 2026.

In April 2026, Genesis paid full contractual rent and interest of $4.7 million.

● On April 23, 2026, the Board of Directors declared a cash dividend of $0.67 per share.

The dividend will be paid on May 15, 2026 to stockholders of record as of the close of business on May 4, 2026.

● We recognized full contractual rental income of $13.3 million and $26.6 million related to Genesis during the three and six months ended June 30, 2026, respectively.

In addition, we recognized interest income of $5.9 million and $12.9 million related to loans with Genesis during the three and six months ended June 30, 2026, respectively.

In July 2026, Genesis paid full contractual rent and interest of $4.5 million.

● On July 23, 2026, the Board of Directors declared a cash dividend of $0.68 per share.

The dividend will be paid on August 14, 2026 to stockholders of record as of the close of business on August 3, 2026.

Results of Operations

The following is our discussion of the consolidated results of operations, financial position and liquidity and capital resources, which should be read in conjunction with our unaudited consolidated financial statements and accompanying notes.

Comparison of results of operations for the three months ended March 31, 2026 and 2025 (dollars in thousands):

Comparison of results of operations for the three and six months ended June 30, 2026 and 2025 (dollars in thousands):

Three Months Ended

Six Months Ended

Rental income

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Interest expense

Senior housing operating expenses

Property-level expenses

General and administrative

Real estate taxes

Acquisition, merger and transition related costs

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(Recovery) provision for credit losses

Other income:

Other income – net

Other income (expense):

Other (expense) income – net

Gain on assets sold – net

Income tax expense

Income from unconsolidated entities

The following is a description of certain of the changes in revenues for the three months ended March 31, 2026 compared to the same period in 2025:

● The increase in rental income was primarily the result of (i) a $22.0 million increase related to facility acquisitions made throughout 2025 and 2026, lease extensions and other rent escalations, (ii) a $5.4 million net increase in rental income from cash basis operators, primarily related to Maplewood, as a result of receiving higher cash rent payments period over period from these operators, (iii) a $3.1 million increase related to higher rental income from our leases with operators in the U.K.

Income (loss) from unconsolidated entities

Three Months ended June 30, 2026 and 2025

The following is a description of certain of the changes in revenues for the three months ended June 30, 2026 compared to the same period in 2025:

● The increase in rental income was primarily the result of (i) a $16.4 million increase related to facility acquisitions made throughout 2025 and 2026, lease extensions and other rent escalations, (ii) an $8.7 million increase resulting from fewer straight-line receivable write-offs in the second quarter of 2026 compared to 2025, (iii) a $2.2 million net increase in rental income from cash basis operators, primarily related to Maplewood, as a result of receiving higher cash rent payments period over period from these operators, and (iv) a $0.6 million increase related to higher rental income from our leases with operators in the U.K.

primarily due to the strengthening of the British Pound Sterling against the U.S.

Dollar and (iv) a $10.0 million lease inducement provided to a cash basis operator that was recorded as a reduction to rental income in the first quarter of 2025, partially offset by a $2.4 million decrease resulting from a straight-line receivable write-off in the first quarter of 2026.

● The increase in interest income was primarily due to (i) a $4.7 million increase related to new loans and additional fundings on existing loans made throughout 2025 and 2026 and (ii) a $0.6 million increase related to loans on non-accrual status in which we have recognized higher interest income period over period as a result of receiving higher cash payments throughout 2025 and 2026, partially offset by a $3.3 million decrease related to principal repayments on our loans during 2026 and 2025.

● The increase in resident fees and services relates to operating revenue from facilities that we own and operate utilizing a RIDEA structure.

The following is a description of certain of the changes in our expenses for the three months ended March 31, 2026 compared to the same period in 2025:

Dollar, partially offset by a $1.1 million decrease related to the impact of facility transitions in the second quarter of 2026.

● The increase in interest income was primarily due to (i) a $4.6 million increase related to new loans and additional fundings on existing loans made throughout 2025 and 2026, (ii) a $1.4 million increase primarily related to a non-cash gain associated with the discount on a loan repaid early in the second quarter of 2026 and (iii) a $1.0 million increase related to loans on non-accrual status in which we have recognized higher interest income period over period as a result of receiving higher cash payments throughout 2025 and 2026, partially offset by a $3.2 million decrease related to principal repayments on our loans during 2026 and 2025.

● The increase in resident fees and services relates to operating revenue from facilities that we own and operate in our Operating segment utilizing a RIDEA structure.

For the three months ended June 30, 2026, resident fees and services were generated by nine senior housing communities in our Operating segment.

As the Company's initial RIDEA acquisitions occurred in the fourth quarter of 2025, there was no comparable revenue in the prior-year period.

The following is a description of certain of the changes in our expenses for the three months ended June 30, 2026 compared to the same period in 2025:

● The increase in depreciation and amortization expense primarily relates to facility acquisitions and capital additions, partially offset by facility sales.

● The decrease in interest expense primarily relates to (i) the repayment of $600 million of 5.25% senior notes in October 2025, (ii) the repayment of a $428.5 million term loan in the fourth quarter of 2025, (iii) the repayment of the £188.6 million mortgage loan in November 2025 and (iv) the repayment of a $50.0 million term loan in April 2025.

● The decrease in interest expense primarily relates to (i) the repayment of $600 million of 5.25% senior notes in October 2025, (ii) the repayment of a $428.5 million term loan in the fourth quarter of 2025, (iii) the repayment of the $400 million of 4.50% senior notes in January 2025, (iv) the repayment of the £188.6 million mortgage loan in November 2025 and (v) the repayment of a $50.0 million term loan in April 2025.

The overall decrease in interest expense was partially offset by (i) a net increase in the amortization of deferred financing fees and discounts as a result of the amortization of the fair value adjustment associated with our previous £188.6 million mortgage loan in the first quarter of 2025 and (ii) an increase in interest expense due to the issuance of $600 million of 5.20% senior unsecured notes in June 2025, the funding of the $300.0 million delayed draw term loan facility (the “2028 Term Loan”) in November 2025 and increased borrowings under our $2.0 billion senior unsecured multicurrency revolving credit facility (the “Revolving Credit Facility”) during 2026.

● The increase in senior housing operating expenses relates to operating expenses from facilities that we own and operate utilizing a RIDEA structure.

● The decrease in general and administrative (“G&A”) expense primarily relates to $6.6 million of incremental non-cash stock-based compensation expense and $2.2 million of incremental payroll expense related to the termination of our former Chief Operating Officer’s employment in the first quarter of 2025, partially offset by (i) an increase in other payroll and benefits and (ii) an increase in professional service costs.

● The change in (recovery) provision for credit losses primarily relates to a smaller provision in the general reserve in the first quarter of 2026 compared to the same period in 2025 primarily resulting from decreases in loss rates utilized in the estimate of credit losses for loans partially offset by increases in loan balances, partially offset by a net increase in aggregate specific recoveries recorded during the first quarter of 2026 compared to same period in 2025.

The decrease in total other income was primarily due to (i) a $7.1 million decrease in gain on assets sold related to the sale of four facilities in the first quarter of 2026 compared to the sale of 27 facilities during the same period in 2025 and (ii) a $2.0 million decrease in other income – net primarily related to decreased interest income on short-term investments due to lower invested cash in the first quarter of 2026 compared to the same period in 2025, partially offset by gains related to financial instruments in the first quarter of 2026.

● The increase in property-level expenses primarily relates to operating expenses from nine facilities that we own and operate in our Operating segment utilizing a RIDEA structure.

As the Company’s initial RIDEA acquisitions occurred in the fourth quarter of 2025, there were no comparable operating expenses in the prior-year period.

● The increase in general and administrative (“G&A”) expense primarily relates to incremental non-cash stock-based compensation expense of $14.7 million and $4.2 million of cash transition related expenses in the second quarter of 2026 related to the leadership transitions announced in the second quarter of 2026.

See Note 14 – Stock-Based Compensation for additional information.

● The increase in acquisition, merger and transition related expenses primarily relates to (i) non-capitalizable costs associated with acquiring a facility through foreclosure and (ii) transaction costs related to pending transactions.

● The 2025 impairments were recognized in connection with three facilities.

These impairments were primarily the result of decisions to exit certain non-strategic facilities and/or terminate our relationships with certain non-strategic operators.

Other Income (Expense)

The increase in total other income (expense) was primarily due to a $223.6 million increase in gain on assets sold related to the sale of 26 facilities in the second quarter of 2026 compared to the sale of seven facilities during the same period in 2025, partially offset by a $21.0 million increase in other expense – net primarily related to decreased interest income on short-term investments due to lower invested cash in the second quarter of 2026 compared to the same period in 2025 and losses associated with foreign currency and financial instruments in the second quarter of 2026 compared to the same period in 2025.

Income (Loss) from Unconsolidated Entities

The increase in income from unconsolidated entities was primarily related to our acquisitions of a 49.0% equity interest in Saber PropCo in the fourth quarter of 2025 and a 9.9% equity interest in Saber in the first quarter of 2026.

Six Months ended June 30, 2026 and 2025

The following is a description of certain of the changes in revenues for the six months ended June 30, 2026 compared to the same period in 2025:

● The increase in rental income was primarily the result of (i) a $38.3 million increase related to facility acquisitions made throughout 2025 and 2026, lease extensions and other rent escalations, (ii) a $10.0 million lease inducement provided to a cash basis operator that was recorded as a reduction to rental income in the first quarter of 2025, (iii) a $7.8 million net increase in rental income from cash basis operators, primarily related to Maplewood, as a result of receiving higher cash rent payments period over period from these operators, (iv) a $6.3 million increase resulting from fewer straight-line receivable write-offs in the first half of 2026 compared to 2025 and (v) a $2.9 million increase related to higher rental income from our leases with operators in the U.K.

primarily due to the strengthening of the British Pound Sterling against the U.S.

Dollar, partially offset by a $0.1 million decrease related to the impact of facility transitions in 2026.

● The increase in interest income was primarily due to (i) a $9.1 million increase related to new loans and additional fundings on existing loans made throughout 2025 and 2026, (ii) a $1.6 million increase related to loans on non-accrual status in which we have recognized higher interest income period over period as a result of receiving higher cash payments throughout 2025 and 2026 and (iii) a $1.4 million increase primarily related to a non-cash gain associated with the discount on a loan repaid early in the second quarter of 2026, partially offset by a $6.2 million decrease related to principal repayments on our loans during 2026 and 2025.

● The increase in resident fees and services relates to operating revenue from facilities that we own and operate in our Operating segment utilizing a RIDEA structure.

For the six months ended June 30, 2026, resident fees and services were generated by nine senior housing communities in our Operating segment.

As the Company’s initial RIDEA acquisitions occurred in the fourth quarter of 2025, there was no comparable revenue in the prior-year period.

The following is a description of certain of the changes in our expenses for the six months ended June 30, 2026 compared to the same period in 2025:

● The increase in depreciation and amortization expense primarily relates to facility acquisitions and capital additions, partially offset by facility sales.

● The decrease in interest expense primarily relates to (i) the repayment of $600 million of 5.25% senior notes in October 2025, (ii) the repayment of a $428.5 million term loan in the fourth quarter of 2025, (iii) the repayment of the $400 million of 4.50% senior notes in January 2025, (iv) the repayment of the £188.6 million mortgage loan in November 2025 and (v) the repayment of a $50.0 million term loan in April 2025.

● The increase in property-level expenses relates to operating expenses from nine facilities that we own and operate in our Operating segment utilizing a RIDEA structure.

As the Company’s initial RIDEA acquisitions occurred in the fourth quarter of 2025, there were no comparable operating expenses in the prior-year period.

● The increase in G&A expense primarily relates to (i) incremental non-cash stock-based compensation expense of $14.7 million and $4.2 million of cash transition related expenses in the second quarter of 2026 related to the leadership transitions announced in the second quarter of 2026, (ii) a $1.3 million increase in other payroll and benefits and (iii) a $1.3 million increase in professional service costs, partially offset by $6.6 million of incremental non-cash stock-based compensation expense and $2.2 million of incremental payroll expense related to the termination of our former Chief Operating Officer’s employment in the first quarter of 2025.

See Note 14 – Stock-Based Compensation for additional information.

● The 2025 impairments were recognized in connection with four facilities and were primarily the result of decisions to exit certain non-strategic facilities and/or terminate our relationships with certain non-strategic operators.

● The change in (recovery) provision for credit losses primarily relates to (i) a net increase in aggregate specific recoveries recorded during the first half of 2026 compared to same period in 2025 and (ii) larger recoveries in the general reserve in the first half of 2026 compared to the same period in 2025 primarily resulting from decreases in loan balances and decreases in loss rates utilized in the estimate of credit losses for loans.

Other Income (Expense)

The increase in total other income (expense) was primarily due to a $216.6 million increase in gain on assets sold related to the sale of 30 facilities in the first half of 2026 compared to the sale of 34 facilities during the same period in 2025, partially offset by a $22.9 million increase in other expense – net primarily related to decreased interest income on short-term investments due to lower invested cash in the first half of 2026 compared to the same period in 2025 and losses associated with foreign currency and financial instruments in the first half of 2026 compared to the same period in 2025.

Income Tax Expense

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as a result of acquisitions in 2026 and 2025.

Income from Unconsolidated Entities

The increase in income from unconsolidated entities was primarily related to our acquisitions of a 49.0% equity interest in SHH Holdings, LLC in the fourth quarter of 2025 and a 9.9% equity interest in Saber Healthcare Holdings, LLC in the first quarter of 2026.

Income (Loss) from Unconsolidated Entities

Non-GAAP Measures

We use funds from operations (“Nareit FFO”) and net operating income (“NOI”), non-GAAP financial measures, as two of several criteria to measure the operating performance of our business.

Funds from Operations

We use funds from operations (“Nareit FFO”), a non-GAAP financial measure, as one of several criteria to measure the operating performance of our business.

We calculate and report Nareit FFO in accordance with the definition of Funds from Operations and interpretive guidelines issued by the National Association of Real Estate Investment Trusts (“Nareit”).

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Investors and potential investors in our securities should not rely on this measure as a substitute for any GAAP measure, including net income.

The following table presents our Nareit FFO results for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

The following table presents our Nareit FFO results for the three and six months ended June 30, 2026 and 2025:

Three Months Ended June 30,

Six Months Ended

(in thousands)

Deduct gain from real estate dispositions

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Impairment on real estate properties

Net Operating Income

Net operating income (“NOI”) is used to evaluate the operating performance of our properties.

We define NOI as total revenues less property level expenses.

Property level expenses represent costs associated with managing, maintaining and servicing tenants for our properties.

These expenses include, but are not limited to, property-related payroll and benefits, property management fees paid to managers, marketing, housekeeping, food service, maintenance, utilities, property taxes and insurance.

NOI also includes the Company’s pro rata share of NOI from its unconsolidated entities.

We utilize our share of NOI in assessing our performance as we have various unconsolidated entities that contribute to our performance.

Our share of NOI should be considered only together with and as a supplement to, and not as a substitute for, our financial information presented in accordance with GAAP.

Our pro rata share information is prepared on a basis consistent with the comparable consolidated amounts, is intended to reflect our proportionate economic interest in the operating results of properties in our portfolio and is calculated by applying our actual ownership percentage for the period.

We do not control the unconsolidated entities, and the pro rata presentations of reconciling items included in NOI do not represent our legal claim to such items.

The unconsolidated entities members or partners are entitled to profit or loss allocations and distributions of cash flows according to the entity agreements, which provide for such allocations generally according to their invested capital.

The following table presents our NOI results for the three and six months ended June 30, 2026 and 2025:

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands)

Depreciation and amortization

Interest expense

General and administrative

Acquisition, merger and transition related costs

Impairment on real estate properties

(Recovery) provision for credit losses

Other expense (income) – net

Gain on assets sold – net

Income tax expense

Non-operating net loss from unconsolidated entities (1)

Non-Segment/Corporate

(1) Represents Omega’s share of non-operating loss from unconsolidated entities in which Omega holds a noncontrolling ownership interest.

These losses primarily consist of depreciation and interest expenses.

The increase in NOI for the three and six months ended June 30, 2026, compared to the corresponding periods in 2025, was primarily driven by (i) higher rental income from the Triple-Net segment and (ii) the contribution of operating income from RIDEA properties in the Operating segment.

As noted above, our initial RIDEA acquisitions occurred in the fourth quarter of 2025, so there were no comparable operating results in the prior-year periods.

Liquidity and Capital Resources

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Capital Structure

At March 31, 2026, we had total assets of $10.2 billion, total equity of $5.5 billion and total debt of $4.5 billion in our consolidated financial statements, with such debt representing 45.1% of total capitalization.

At March 31, 2026 and December 31, 2025, the weighted average annual interest rate of our debt was 4.2%.

Additionally, as of March 31, 2026, 90.5% of our debt with outstanding principal balances has fixed interest payments after reflecting the impact of interest rate swaps that are designated as cash flow hedges.

As of March 31, 2026, we had long-term credit ratings of Baa3 from Moody’s and BBB- from S&P Global and Fitch.

At June 30, 2026, we had total assets of $10.0 billion, total equity of $5.6 billion and total debt of $4.1 billion in our consolidated financial statements, with such debt representing 41.8% of total capitalization.

At June 30, 2026 and December 31, 2025, the weighted average annual interest rate of our debt was 4.2%.

Additionally, as of June 30, 2026, 99.9% of our debt with outstanding principal balances has fixed interest payments after reflecting the impact of interest rate swaps that are designated as cash flow hedges.

As of June 30, 2026, we had long-term credit ratings of Baa3 from Moody’s and BBB- from S&P Global and Fitch.

Credit ratings impact our ability to access capital and directly impact our cost of capital as well.

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Our next senior unsecured note maturity is the $700.0 million of 4.50% senior unsecured notes that mature in April 2027.

As of March 31, 2026, we had $26.1 million of cash and cash equivalents on our Consolidated Balance Sheets, $1.9 billion of potential common share issuances remaining under the ATM Program and $1.6 billion of availability under our Revolving Credit Facility.

As of June 30, 2026, we had $39.0 million of cash and cash equivalents on our Consolidated Balance Sheets, $1.8 billion of potential common share issuances remaining under the ATM Program and $2.0 billion of availability under our Revolving Credit Facility.

This combination of liquidity sources, along with cash from operating activities, provides us with the ability to repay our upcoming debt maturities.

Certain of our other secured and unsecured borrowings are subject to customary affirmative and negative covenants, including financial covenants.

As of March 31, 2026 and December 31, 2025, we were in compliance with all affirmative and negative covenants, including financial covenants, for our secured and unsecured borrowings.

As of June 30, 2026 and December 31, 2025, we were in compliance with all affirmative and negative covenants, including financial covenants, for our secured and unsecured borrowings.

Supplemental Guarantor Information

Parent has issued $3.8 billion aggregate principal of senior notes outstanding at March 31, 2026 that were registered under the Securities Act of 1933, as amended.

Parent has issued $3.8 billion aggregate principal of senior notes outstanding at June 30, 2026 that were registered under the Securities Act of 1933, as amended.

The senior notes are guaranteed by Omega OP.

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However, the guarantees are effectively subordinated to any secured debt of Omega OP.

As of March 31, 2026, there were no significant restrictions on the ability of Omega OP to make distributions to Omega.

At March 31, 2026, we had 297,797 thousand shares of common stock outstanding, and our shares had a market value of $13.0 billion.

The following is a summary of activity under our equity programs during the three months ended March 31, 2026:

● We issued 2.2 million shares of common stock under our ATM Program for aggregate gross proceeds of $106.7 million during the three months ended March 31, 2026 .

As of June 30, 2026, there were no significant restrictions on the ability of Omega OP to make distributions to Omega.

At June 30, 2026, we had 299,111 thousand shares of common stock outstanding, and our shares had a market value of $14.3 billion.

The following is a summary of activity under our equity programs during the three and six months ended June 30, 2026:

● We issued 1.1 million and 3.3 million shares of common stock under our ATM Program for aggregate gross proceeds of $53.8 million and $160.5 million during the three and six months ended June 30, 2026, respectively .

We did not utilize the forward provisions under the ATM Program.

We have $1.9 billion of potential common share issuances remaining under the ATM Program as of March 31, 2026 .

● We issued 9 thousand shares of common stock under the DRCSPP for aggregate gross proceeds of $0.4 million during the three months ended March 31, 2026 .

We have $1.8 billion of potential common share issuances remaining under the ATM Program as of June 30, 2026 .

● We issued 0.2 million and 0.2 million shares of common stock under the DRCSPP for aggregate gross proceeds of $8.1 million and $8.6 million during the three and six months ended June 30, 2026 .

As a REIT, we are required to distribute dividends (other than capital gain dividends) to our stockholders in an amount at least equal to (A) the sum of (i) 90% of our “REIT taxable income” (computed without regard to the dividends paid deduction and our net capital gain), and (ii) 90% of the net income (after tax), if any, from foreclosure property, minus (B) the sum of certain items of non-cash income.

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To the extent that we do not distribute all of our net capital gain or distribute at least 90%, but less than 100% of our “REIT taxable income” as adjusted, we will be subject to tax thereon at regular corporate rates.

For the three months ended March 31, 2026 , we paid dividends of $198.4 million to our common stockholders.

For the six months ended June 30, 2026 , we paid dividends of $398.4 million to our common stockholders.

On February 17, 2026, we paid dividends of $0.67 per outstanding common share to the common stockholders of record as of the close of business on February 9, 2026.

On May 15, 2026, we paid dividends of $0.67 per outstanding common share to the common stockholders of record as of the close of business on May 4, 2026.

Material Cash Requirements

During the three months ended March 31, 2026 , there were no significant changes to our material cash requirements from those disclosed in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025.

As of March 31, 2026 , we had $201.6 million of commitments to fund the construction of new facilities, capital improvements and other commitments under lease agreements.

During the six months ended June 30, 2026 , there were no significant changes to our material cash requirements from those disclosed in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025.

As of June 30, 2026 , we had $163.2 million of commitments to fund the construction of new facilities, capital improvements and other commitments under lease agreements.

Additionally, we have commitments to fund $67.0 million of advancements under existing real estate loans and $41.0 million of advancements under existing non-real estate loans.

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Cash Flow Summary

Cash, cash equivalents and restricted cash totaled $53.3 million as of March 31, 2026 , a decrease of $1.2 million as compared to the balance at December 31, 2025.

The following is a summary of our sources and uses of cash flows for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 (dollars in thousands):

Three Months Ended March 31,

Cash, cash equivalents and restricted cash totaled $184.2 million as of June 30, 2026 , an increase of $129.6 million as compared to the balance at December 31, 2025.

The following is a summary of our sources and uses of cash flows for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 (dollars in thousands):

Six Months Ended June 30,

Increase/(Decrease)

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Financing activities

The following is a discussion of changes in cash, cash equivalents and restricted cash for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 .

The following is a discussion of changes in cash, cash equivalents and restricted cash for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 .

Operating Activities – The increase in net cash provided by operating activities is driven primarily by an increase of $52.4 million in net income, net of $233.3 million of non-cash items, primarily due to a year over year increase in rental income, interest income and resident fees and services as discussed in our material changes analysis under Results of Operations above.

Investing Activities – The increase in cash used in investing activities primarily related to (i) a $97.1 million increase in loan placements, net of repayments, as a result of more new loans advanced in 2026 compared to 2025 and paydowns on mortgage loans due from Ciena Healthcare Management, Inc.

and on other loans during the first quarter of 2025, (ii) a $96.0 million increase in investments in unconsolidated entities, (iii) an $86.4 million decrease in proceeds from the sales of real estate investments and (iv) a $66.6 million increase in real estate acquisitions.

The overall increase in cash used in investing activities was partially offset by (i) the funding of a $30.1 million acquisition deposit in the first quarter of 2025 for an asset acquisition that closed in April 2025, (ii) a $22.4 million decrease in capital improvements to real estate investments and construction in progress, (iii) a $2.2 million increase in distributions from unconsolidated entities in excess of earnings and (iv) a $1.3 million increase in receipts from insurance proceeds.

Financing Activities – The increase in cash provided by financing activities primarily related to a $583.6 million increase in proceeds on long-term borrowings, net of repayments.

The overall increase in cash provided by financing activities was partially offset by (i) a $155.8 million decrease in net proceeds from issuance of common stock as a result of decreased volume under our ATM Program and DRCSPP, (ii) a $13.3 million increase in redemption of Omega OP Units, (iii) a $9.2 million increase in dividends paid primarily related to common stock issuances during 2025 and 2026 and (iv) a $2.9 million increase in distributions to Omega OP Unit holders due to the issuance of Omega OP Units in exchange for a 49% equity interest in SHH Holdings, LLC in the fourth quarter of 2025.

The increase was partially offset by a $40.4 million change in the net movements of the operating assets and liabilities.

Investing Activities – The increase in cash provided by investing activities primarily related to (i) a $376.7 million increase in proceeds from the sales of real estate investments, (ii) a $334.3 million decrease in real estate acquisitions, (iii) a $76.5 million increase in loan repayments, net of loan placements, as a result of more loans advanced in 2026 compared to 2025 partially offset by paydowns on loans in 2025 and 2026, (iv) a $28.1 million decrease in capital improvements to real estate investments and construction in progress, (v) a $5.2 million increase in distributions from unconsolidated entities in excess of earnings and (vi) a $5.0 million increase in receipts from insurance proceeds.

The overall increase in cash provided by investing activities was partially offset by (i) a $95.9 million increase in investments in unconsolidated entities and (ii) a $3.7 million decrease in proceeds from derivative instruments.

Financing Activities – The increase in cash used in financing activities primarily related to (i) a $379.5 million increase in long-term borrowings repayments, net of proceeds received, (ii) a $351.5 million decrease in net proceeds from issuance of common stock as a result of decreased volume under our ATM Program and DRCSPP, (iii) an $80.2 million increase related to redemption of Omega OP Units, (iv) a $14.7 million increase in dividends paid primarily related to common stock issuances during 2025 and 2026 and (v) a $6.4 million increase in distributions to Omega OP Unit holders due to the issuance of Omega OP Units in exchange for a 49% equity interest in Saber PropCo in the fourth quarter of 2025.

The overall increase in cash used in financing activities was partially offset by a $6.2 million decrease in finance related costs.

Critical Accounting Policies and Estimates

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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 2. Management’s Discussion and Analysis