Item 1. Financial Statements (Unaudited)

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Item 1. Financial Statements (Unaudited)

Healthpeak Properties, Inc.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

(Unaudited)


	March 31, 2025		December 31, 2024
ASSETS
Real estate:
Buildings and improvements	$	16,176,176	$	16,115,283
Development costs and construction in progress	962,714		880,393
Land and improvements	2,941,082		2,918,758
Accumulated depreciation and amortization	(4,240,220)		(4,083,030)
Net real estate	15,839,752		15,831,404

Loans receivable, net of reserves of $7,554 and $10,499	698,525		717,190
Investments in and advances to unconsolidated joint ventures	951,978		936,814
Accounts receivable, net of allowance of $2,040 and $2,243	68,908		76,810
Cash and cash equivalents	70,625		119,818
Restricted cash	67,981		64,487
Intangible assets, net	747,789		817,254
Assets held for sale, net	7,840		7,840
Right-of-use asset, net	422,017		424,173
Other assets, net	940,314		942,465
Total assets	$	19,815,729	$	19,938,255

LIABILITIES AND EQUITY
Bank line of credit and commercial paper	$	164,000	$	150,000
Term loans	1,646,335		1,646,043
Senior unsecured notes	6,714,279		6,563,256
Mortgage debt	352,051		356,750
Intangible liabilities, net	179,002		191,884

Lease liability	306,577		307,220
Accounts payable, accrued liabilities, and other liabilities	670,221		725,342
Deferred revenue	939,855		940,136
Total liabilities	10,972,320		10,880,631

Commitments and contingencies (Note 11)

Redeemable noncontrolling interests	14,417		2,610


Common stock, $1.00 par value: 1,500,000,000 shares authorized; 698,611,840 and 699,485,139 shares issued and outstanding	698,612		699,485
Additional paid-in capital	12,827,628		12,847,252
Cumulative dividends in excess of earnings	(5,345,120)		(5,174,279)
Accumulated other comprehensive income (loss)	6,927		28,818
Total stockholders’ equity	8,188,047		8,401,276
Joint venture partners	299,923		315,821
Non-managing member unitholders	341,022		337,917
Total noncontrolling interests	640,945		653,738
Total equity	8,828,992		9,055,014
Total liabilities and equity	$	19,815,729	$	19,938,255

See accompanying Notes to the Unaudited Consolidated Financial Statements.

Healthpeak Properties, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)


	Three Months Ended March 31,
	2025		2024
Revenues:
Rental and related revenues	$	538,141	$	462,033
Resident fees and services	148,927		138,776
Interest income and other	15,821		5,751

Total revenues	702,889		606,560
Costs and expenses:
Interest expense	72,693		60,907
Depreciation and amortization	268,546		219,219
Operating	273,143		243,729
General and administrative	26,118		23,299
Transaction and merger-related costs	5,534		107,220

Impairments and loan loss reserves (recoveries), net	(3,562)		11,458
Total costs and expenses	642,472		665,832
Other income (expense):
Gain (loss) on sales of real estate, net	—		3,255

Other income (expense), net	(6,126)		78,516
Total other income (expense), net	(6,126)		81,771
Income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures	54,291		22,499
Income tax benefit (expense)	(2,080)		(13,698)
Equity income (loss) from unconsolidated joint ventures	(2,147)		2,376


Net income (loss)	50,064		11,177
Noncontrolling interests’ share in earnings	(7,236)		(4,501)

Net income (loss) attributable to Healthpeak Properties, Inc.	42,828		6,676

Participating securities’ share in earnings	(464)		(199)
Net income (loss) applicable to common shares	$	42,364	$	6,477









Earnings (loss) per common share:
Basic	$	0.06	$	0.01
Diluted	$	0.06	$	0.01
Weighted average shares outstanding:
Basic	699,067		600,898
Diluted	699,118		601,188

See accompanying Notes to the Unaudited Consolidated Financial Statements.

Healthpeak Properties, Inc.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

(Unaudited)


	Three Months Ended March 31,
	2025		2024
Net income (loss)	$	50,064	$	11,177
Other comprehensive income (loss):
Net unrealized gains (losses) on derivatives	(21,961)		19,108
Change in Supplemental Executive Retirement Plan obligation and other	70		64

Total other comprehensive income (loss)	(21,891)		19,172
Total comprehensive income (loss)	28,173		30,349
Total comprehensive (income) loss attributable to noncontrolling interests	(7,236)		(4,501)

Total comprehensive income (loss) attributable to Healthpeak Properties, Inc.	$	20,937	$	25,848

See accompanying Notes to the Unaudited Consolidated Financial Statements.

Healthpeak Properties, Inc.

CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS

(In thousands, except per share data)

(Unaudited)

For the three months ended March 31, 2025:


	Common Stock			Additional Paid-In Capital		Cumulative Dividends In Excess Of Earnings		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity		Total Noncontrolling Interests		Total Equity		Redeemable Noncontrolling Interests
	Shares	Amount


January 1, 2025	699,485	$	699,485	$	12,847,252	$	(5,174,279)	$	28,818	$	8,401,276	$	653,738	$	9,055,014	$	2,610
Net income (loss)	—	—		—		42,828		—		42,828		7,292		50,120		(56)
Other comprehensive income (loss)	—	—		—		—		(21,891)		(21,891)		—		(21,891)		—

Issuance of common stock, net	371	371		(117)		—		—		254		—		254		—
Conversion of DownREIT units to common stock	34	34		845		—		—		879		(879)		—		—
Repurchase of common stock	(1,278)	(1,278)		(23,681)		—		—		(24,959)		—		(24,959)		—

Stock-based compensation	—	—		2,201		—		—		2,201		3,985		6,186		—
Common dividends ($0.305 per share)	—	—		—		(213,669)		—		(213,669)		—		(213,669)		—
Distributions to noncontrolling interests	—	—		—		—		—		—		(10,186)		(10,186)		(14)



Adjustments to redeemable noncontrolling interests	—	—		1,128		—		—		1,128		(13,005)		(11,877)		11,877


March 31, 2025	698,612	$	698,612	$	12,827,628	$	(5,345,120)	$	6,927	$	8,188,047	$	640,945	$	8,828,992	$	14,417

For the three months ended March 31, 2024:


	Common Stock			Additional Paid-In Capital		Cumulative Dividends In Excess Of Earnings		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity		Total Noncontrolling Interests		Total Equity		Redeemable Noncontrolling Interests
	Shares	Amount


January 1, 2024	547,156	$	547,156	$	10,405,780	$	(4,621,861)	$	19,371	$	6,350,446	$	525,596	$	6,876,042	$	48,828
Net income (loss)	—	—		—		6,676		—		6,676		4,318		10,994		183
Other comprehensive income (loss)	—	—		—		—		19,172		19,172		—		19,172		—
Shares issued as part of the Merger	162,231	162,231		2,611,916		—		—		2,774,147		—		2,774,147		—
Issuance of common stock, net	299	299		9		—		—		308		—		308		—

Repurchase of common stock	(5,953)	(5,953)		(96,042)		—		—		(101,995)		—		(101,995)		—

Stock-based compensation	—	—		1,827		—		—		1,827		3,392		5,219		—
Common dividends ($0.300 per share)	—	—		—		(164,414)		—		(164,414)		—		(164,414)		—
Distributions to noncontrolling interests	—	—		—		—		—		—		(6,995)		(6,995)		(263)



Contributions from noncontrolling interests	—	—		—		—		—		—		—		—		10

Noncontrolling interests acquired as part of the Merger	—	—		—		—		—		—		136,727		136,727		1,536
Adjustments to redeemable noncontrolling interests	—	—		(4,554)		—		—		(4,554)		—		(4,554)		4,554
March 31, 2024	703,733	$	703,733	$	12,918,936	$	(4,779,599)	$	38,543	$	8,881,613	$	663,038	$	9,544,651	$	54,848

See accompanying Notes to the Unaudited Consolidated Financial Statements.

Healthpeak Properties, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	Three Months Ended March 31,
	2025		2024
Cash flows from operating activities:
Net income (loss)	$	50,064	$	11,177
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization of real estate, in-place lease, and other intangibles	268,546		219,219
Stock-based compensation amortization expense	4,627		3,366
Merger-related post-combination stock compensation expense	—		16,223
Amortization of deferred financing costs and debt discounts (premiums)	7,852		4,522
Straight-line rents	(11,153)		(12,093)

Amortization of non-refundable entrance fees and above (below) market lease intangibles	(34,218)		(28,928)
Equity loss (income) from unconsolidated joint ventures	2,147		(2,376)
Distributions of earnings from unconsolidated joint ventures	7,094		1,958


Deferred income tax expense (benefit)	946		10,006
Impairments and loan loss reserves (recoveries), net	(3,562)		11,458

Loss (gain) on sales of real estate, net	—		(3,255)
Loss (gain) upon change of control, net	—		(77,781)
Casualty-related loss (recoveries), net	6,249		—


Other non-cash items	(2,658)		819
Changes in:
Decrease (increase) in accounts receivable and other assets, net	7,212		(2,171)
Increase (decrease) in accounts payable, accrued liabilities, and deferred revenue	(23,717)		420
Net cash provided by (used in) operating activities	279,429		152,564
Cash flows from investing activities:
Acquisitions of real estate	(37,533)		—
Development, redevelopment, and other major improvements of real estate	(166,040)		(107,050)
Leasing costs, tenant improvements, and recurring capital expenditures	(23,136)		(17,517)
Proceeds from sales of real estate, net	—		28,206

Proceeds from the Callan Ridge JV transaction, net	—		125,662

Investments in unconsolidated joint ventures	(32,434)		(26,621)
Distributions in excess of earnings from unconsolidated joint ventures	7,478		7,291
Proceeds from insurance recovery	386		2,361




Proceeds from sales/principal repayments on loans receivable	64,141		75,306
Investments in loans receivable and other	(43,576)		(6,204)
Cash paid in connection with the Merger, net	—		(179,215)

Net cash provided by (used in) investing activities	(230,714)		(97,781)
Cash flows from financing activities:
Borrowings under bank line of credit and commercial paper	4,279,000		2,500,000
Repayments under bank line of credit and commercial paper	(4,265,000)		(3,037,000)
Issuances and borrowings of term loans, senior unsecured notes, and mortgage debt	494,495		750,000
Repayments and repurchases of term loans, senior unsecured notes, and mortgage debt	(352,864)		(861)

Payments for deferred financing costs	(1,471)		(5,438)

Issuance of common stock and exercise of options, net of offering costs	64		94
Repurchase of common stock	(24,959)		(101,995)
Dividends paid on common stock	(213,479)		(164,200)

Distributions to and purchase of noncontrolling interests	(10,200)		(7,258)
Contributions from and issuance of noncontrolling interests	—		10
Net cash provided by (used in) financing activities	(94,414)		(66,648)

Net increase (decrease) in cash, cash equivalents, and restricted cash	(45,699)		(11,865)
Cash, cash equivalents, and restricted cash, beginning of period	184,305		169,023
Cash, cash equivalents, and restricted cash, end of period	$	138,606	$	157,158

See accompanying Notes to the Unaudited Consolidated Financial Statements.

Healthpeak Properties, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1. Business

Overview

Healthpeak Properties, Inc., a Standard & Poor’s 500 company, is a Maryland corporation that is organized to qualify as a real estate investment trust (“REIT”) and that, together with its consolidated entities (collectively, “Healthpeak” or the “Company”), owns, operates, and develops high-quality real estate focused on healthcare discovery and delivery in the United States (“U.S.”). Healthpeak® has a diverse portfolio comprised of investments in the following reportable healthcare segments: (i) outpatient medical; (ii) lab; and (iii) continuing care retirement community (“CCRC”).

The Company’s corporate headquarters are in Denver, Colorado, and it has additional corporate offices in California, Tennessee, Wisconsin, and Massachusetts, and property management offices in several locations throughout the U.S.

The Company is organized as an umbrella partnership REIT (“UPREIT”). Substantially all of the Company’s business is conducted through Healthpeak OP, LLC (“Healthpeak OP”). The Company is the managing member of Healthpeak OP and does not have material assets or liabilities, other than through its investment in Healthpeak OP.

On March 1, 2024, the Company completed its planned merger with Physicians Realty Trust (see Note 3).

NOTE 2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information. Management is required to make estimates and assumptions in the preparation of financial statements in conformity with GAAP. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from management’s estimates.

The consolidated financial statements include the accounts of Healthpeak Properties, Inc., its wholly owned subsidiaries, joint ventures (“JVs”) that it controls, and variable interest entities (“VIEs”) in which the Company has determined it is the primary beneficiary. Intercompany transactions and balances have been eliminated upon consolidation. All adjustments (consisting of normal recurring adjustments) necessary to present fairly the Company’s financial position, results of operations, and cash flows have been included. Operating results for the three months ended March 31, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. The accompanying unaudited interim financial information should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission (“SEC”).

Recent Accounting Pronouncements

Adopted

Segment Reporting. In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), to improve reportable segment disclosure requirements so that investors can better understand an entity’s overall performance and assess potential future cash flows. The amendments in ASU 2023-07 include, but are not limited to: (i) disclosure of, on an annual basis, significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss; (ii) disclosure of, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition (the other segment items category is the difference between segment revenue less the significant expenses disclosed and each reported measure of segment profit or loss); (iii) disclosure of, on an interim basis, all currently required annual disclosures about a reportable segment’s profit (loss) and assets; (iv) clarification that if the CODM uses more than one measure of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources, an entity may report one or more of those additional measures of segment profit; and (v) disclosure of the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. During the year ended December 31, 2024, the amendments in ASU 2023-07 were adopted retrospectively and did not have an impact on the Company’s consolidated financial position, results of operations, or cash flows.

Not Yet Adopted

Income Taxes. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), to provide disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. One of the amendments in ASU 2023-09 includes disclosure of, on an annual basis, a tabular rate reconciliation (using both percentages and reporting currency amounts) of (i) the reported income tax expense (or benefit) from continuing operations, to (ii) the product of the income (or loss) from continuing operations before income taxes and the applicable statutory federal income tax rate of the jurisdiction of domicile using specific categories, including separate disclosure for any reconciling items within certain categories that are equal to or greater than a specified quantitative threshold of 5%. ASU 2023-09 also requires disclosure of, on an annual basis, the year-to-date amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign jurisdictions, including additional disaggregated information on income taxes paid (net of refunds received) to an individual jurisdiction equal to or greater than 5% of total income taxes paid (net of refunds received). The amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2024. The Company is evaluating the impact ASU 2023-09 will have on its disclosures.

Expense Disaggregation. In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), to address requests from investors for more detailed information about the types of expenses in commonly presented expense captions. ASU 2024-03 requires public companies to provide disaggregated disclosure in tabular format in the notes to financial statements of specific expenses, including but not limited to: (i) employee compensation, (ii) depreciation, and (iii) intangible asset amortization. In January 2025, the FASB issued ASU No. 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, which clarifies that the amendments in ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company is evaluating the impact these ASUs will have on its disclosures.

NOTE 3. The Merger

On March 1, 2024 (the “Closing Date”), pursuant to the Agreement and Plan of Merger dated October 29, 2023 (the “Merger Agreement”), by and among the Company, DOC DR Holdco, LLC, a wholly owned subsidiary of the Company (“DOC DR Holdco”), DOC DR, LLC, a wholly owned subsidiary of Healthpeak OP (“DOC DR OP Sub”), Physicians Realty Trust, and Physicians Realty L.P. (the “Physicians Partnership”): (i) Physicians Realty Trust merged with and into DOC DR Holdco (the “Company Merger”), with DOC DR Holdco surviving as a wholly owned subsidiary of the Company (the “Company Surviving Entity”); (ii) immediately following the effectiveness of the Company Merger, the Company contributed all of the outstanding equity interests in the Company Surviving Entity to Healthpeak OP (the “Contribution”); and (iii) immediately following the Contribution, Physicians Partnership merged with and into DOC DR OP Sub (the “Partnership Merger” and, together with the Company Merger, the “Merger”), with DOC DR OP Sub surviving as a subsidiary of Healthpeak OP (the “Partnership Surviving Entity”). Subsequent to the Closing Date, the “Combined Company” means the Company and its subsidiaries.

On the Closing Date and in connection with the Merger, (i) each outstanding common share of beneficial interest of Physicians Realty Trust (“Physicians Realty Trust common shares”) (other than Physicians Realty Trust common shares that were canceled in accordance with the Merger Agreement) was automatically converted into the right to receive 0.674 (the “Exchange Ratio”) shares of the Company’s common stock, and (ii) each outstanding common unit of the Physicians Partnership was converted into common units in the Partnership Surviving Entity equal to the Exchange Ratio.

As a result of the Merger, the Company acquired 299 outpatient medical buildings. The primary reason for the Merger was to expand the Company’s size, scale, and diversification, in order to further enhance the Company’s competitive advantages and accelerate investment activities.

The Merger was accounted for using the acquisition method of accounting in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations (“ASC 805”), which requires, among other things, the assets acquired and the liabilities assumed to be recognized at their acquisition date fair value. For accounting purposes, the Company was treated as the accounting acquirer of Physicians Realty Trust. The Company was considered to be the accounting acquirer primarily because: (i) the Company is the entity that transferred consideration to consummate the Merger; (ii) the Company’s stockholders as a group retained the largest portion of the voting rights of the Combined Company and have the ability to elect, appoint, or remove a majority of the members of the Combined Company’s board of directors; and (iii) its senior management constitutes the majority of management of the Combined Company.

The consideration transferred on the Closing Date was as follows (in thousands, except per share data):


	March 1, 2024
Physicians Realty Trust common shares and Physicians Realty Trust restricted shares, PSUs, and RSUs exchanged(1)	240,699
Exchange Ratio	0.674
Shares of Healthpeak common stock issued	162,231
Closing price of Healthpeak common stock on March 1, 2024(2)	$	17.10
Fair value of Healthpeak common stock issued to the former holders of Physicians Realty Trust common shares, restricted shares, PSUs, and RSUs	$	2,774,147

Less: Fair value of share consideration attributable to the post-combination period(3)	(16,223)

Physicians Realty Trust revolving credit facility termination(4)	$	175,411
Settlement of Physicians Realty Trust’s transaction costs	23,913
Payments made in connection with share settlement(5)	11,315

Cash consideration	$	210,639

Consideration transferred	$	2,968,563

_______________________________________

(1)Includes 241 million Physicians Realty Trust common shares and Physicians Realty Trust restricted shares outstanding as of March 1, 2024, inclusive of: (i) 200 thousand Physicians Realty Trust restricted shares; (ii) 1 million Physicians Realty Trust common shares issuable pursuant to outstanding Physicians Realty Trust performance-based restricted stock unit (“PSUs”) (reflected at the maximum level of performance); and (iii) 300 thousand Physicians Realty Trust common shares issuable pursuant to outstanding Physicians Realty Trust restricted stock units (“RSUs”).

(2)The fair value of Healthpeak common stock issued to former holders of Physicians Realty Trust common shares and Physicians Realty Trust restricted shares, PSUs, and RSUs was based on the per share closing price of Healthpeak common stock on March 1, 2024.

(3)Represents the fair value of unvested Physicians Realty Trust restricted shares, PSUs, and RSUs attributable to post-combination services that were converted into Healthpeak common stock on the Closing Date in accordance with the Merger Agreement. Although no future service after the Closing Date is required, the value attributable to post-combination services reflected the incremental fair value provided to the Physicians Realty Trust equity award holders and the accelerated vesting of such awards at the Closing Date in accordance with the Merger Agreement. This amount was recognized as transaction and merger-related costs on the Consolidated Statements of Operations.

(4)Represents the Company’s cash repayment of all outstanding balances under Physicians Realty Trust’s revolving credit facility on the Closing Date in connection with the related termination.

(5)Includes cash settlement of: (i) tax liability related to holdback elections made under the pre-existing terms and conditions of Physicians Realty Trust’s equity programs and (ii) fractional share consideration.

Purchase Price Allocation

For the Company’s real estate acquisitions that are accounted for as business combinations, such as the Merger, the Company allocates the acquisition consideration (excluding acquisition costs) to the assets acquired, liabilities assumed, and noncontrolling interests at fair value as of the acquisition date. Any excess of the consideration transferred relative to the fair value of the net assets acquired is accounted for as goodwill. Acquisition costs related to business combinations are expensed as incurred. The estimated fair values of the assets acquired, liabilities assumed, and noncontrolling interests were based on information that was available at the Closing Date. The fair values were determined using standard valuation methodologies, such as the cost, market, and income approach. These methodologies require various assumptions, including those of a market participant.

The following table summarizes the fair values of the assets acquired, liabilities assumed, and noncontrolling interests at the Closing Date (in thousands):


	Preliminary Amounts Recognized on the Closing Date		Measurement Period Adjustments		Amounts Recognized on the Closing Date (As Adjusted)
ASSETS
Real estate:
Buildings and improvements	$	3,199,884	$	(6,889)	$	3,192,995
Development costs and construction in progress	68,171		—		68,171
Land and improvements	435,353		—		435,353
Real estate	3,703,408		(6,889)		3,696,519
Loans receivable	118,908		—		118,908
Investments in and advances to unconsolidated joint ventures	58,636		—		58,636
Accounts receivable, net(1)	9,536		(254)		9,282
Cash and cash equivalents	30,417		—		30,417
Restricted cash	1,007		—		1,007
Intangible assets(2)	890,827		—		890,827
Right-of-use asset	191,415		(113)		191,302
Other assets	44,691		(668)		44,023
Total assets	$	5,048,845	$	(7,924)	$	5,040,921

LIABILITIES AND EQUITY
Term loans	$	402,320	$	—	$	402,320
Senior unsecured notes	1,139,760		—		1,139,760
Mortgage debt	127,176		—		127,176
Intangible liabilities(3)	149,875		—		149,875
Lease liability	97,160		(113)		97,047
Accounts payable, accrued liabilities, and other liabilities	72,864		(2,976)		69,888

Total liabilities	$	1,989,155	$	(3,089)	$	1,986,066

Redeemable noncontrolling interests	1,536		1,573		3,109

Joint venture partners(4)	20,109		(3,043)		17,066
Non-managing member unitholders(5)	116,618		—		116,618
Total noncontrolling interests	$	136,727	$	(3,043)	$	133,684

Fair value of net assets acquired and liabilities assumed, net of noncontrolling interests	$	2,921,427	$	(3,365)	$	2,918,062

Goodwill	47,136		3,365		50,501

Total purchase price	$	2,968,563	$	—	$	2,968,563

_______________________________________

(1)Includes $14 million of gross contractual accounts receivable.

(2)The intangible assets acquired had a weighted average amortization period of 6 years (see Note 9).

(3)The intangible liabilities acquired had a weighted average amortization period of 9 years (see Note 9).

(4)Includes six consolidated joint ventures in which the Company held ownership interests ranging from 56.7% to 99.7% on the Closing Date.

(5)In connection with the Merger, Physicians Partnership merged with and into DOC DR OP Sub with DOC DR OP Sub surviving as the Partnership Surviving Entity. The Company controls the Partnership Surviving Entity via its ownership of its managing member, and the Partnership Surviving Entity is consolidated by the Company.

The measurement period adjustments recorded through December 31, 2024 are final and were primarily the result of additional information obtained during the measurement period by the Company related to certain assets acquired and liabilities assumed and updated valuations of noncontrolling interests, resulting in an increase to goodwill of $3 million.

Based on the final purchase price allocation of fair value, approximately $51 million has been allocated to goodwill. The recognized goodwill was attributable to expected synergies, cost savings, acquired workforce, and potential economies of scale benefits from outpatient medical property management and tenant and vendor relationships following the closing of the Merger. None of the goodwill recognized is expected to be deductible for tax purposes.

Merger-Related Costs

During the three months ended March 31, 2025, the Company incurred approximately $5 million of merger-related costs, including severance, legal, accounting, tax, information technology, and other costs of combining operations with Physicians Realty Trust. During the three months ended March 31, 2024, the Company incurred approximately $107 million of merger-related costs, which primarily related to advisory, legal, accounting, tax, post-combination severance and stock compensation expense, and other costs of combining operations with Physicians Realty Trust. Included in this amount was: (i) $38 million of fees paid to investment banks and advisors to help the Company negotiate the terms of the transactions contemplated by the Merger Agreement and to advise the Company on other merger-related matters, inclusive of $21 million of success-based fees incurred upon consummation of the Merger, (ii) $26 million of severance expense due to certain Physicians Realty Trust dual-trigger severance arrangements that were required to be recognized as post-combination expense in accordance with ASC 805, (iii) $16 million of post-combination stock compensation expense for the accelerated vesting of Physicians Realty Trust equity awards pursuant to the terms of the Merger Agreement, based on the fair value of Healthpeak common stock issued to holders of Physicians Realty Trust equity awards, (iv) $19 million of legal, accounting, tax, information technology, and other costs, and (v) $8 million of severance expense related to legacy Healthpeak employees. These merger-related costs are included in transaction and merger-related costs on the Consolidated Statements of Operations.

Unaudited Pro Forma Financial Information

The Consolidated Statements of Operations for the three months ended March 31, 2024 include $49 million of revenues and $19 million of net loss applicable to common shares associated with the results of operations of legacy Physicians Realty Trust from the Closing Date to March 31, 2024.

The following unaudited pro forma information presents a summary of the results of operations for the Combined Company, as if the Merger had been consummated on January 1, 2023 (in thousands). There are no pro forma adjustments for the three months ended March 31, 2025 as the Merger was completed on March 1, 2024. The following unaudited pro forma financial information is not necessarily indicative of the results of operations had the acquisition been effected on the assumed date, nor is it necessarily an indication of trends in future results for a number of reasons, including, but not limited to, differences between the assumptions used to prepare the unaudited pro forma financial information, cost savings from operating efficiencies, potential synergies, and the impact of incremental costs incurred in integrating the businesses.


	Three Months Ended March 31, 2024

Total revenues	$	698,702
Net income (loss) applicable to common shares	87,604

The unaudited pro forma financial information above includes nonrecurring significant adjustments made to account for certain costs incurred as if the Merger had been completed on January 1, 2023. Transaction and merger-related costs of $107 million that were incurred during the three months ended March 31, 2024 were excluded from the unaudited pro forma financial information for the three months ended March 31, 2024 as if they were incurred on the pro forma completion date of January 1, 2023.

NOTE 4. Real Estate Investments

2025 Real Estate Investment Acquisitions

Middletown Medical Portfolio

In February 2025, the Company acquired a portfolio of three outpatient medical buildings in New York for $17 million.

100 Smith Land Parcel

In February 2025, the Company acquired a lab land parcel in Cambridge, Massachusetts for $20 million.

2024 Real Estate Investment Acquisitions

The Merger

As a result of the Merger, the Company acquired 299 outpatient medical buildings (see Note 3).

Development Activities

The Company’s commitments, which are primarily related to development and redevelopment projects and Company-owned tenant improvements, decreased by $4 million to $280 million at March 31, 2025, when compared to December 31, 2024, primarily as a result of construction spend on projects in development and redevelopment, partially offset by additional commitments on projects placed into development and redevelopment during the first quarter of 2025.

NOTE 5. Dispositions of Real Estate

2024 Dispositions of Real Estate

During the three months ended March 31, 2024, the Company sold two outpatient medical buildings for $29 million, resulting in total gain on sales of $3 million.

During the year ended December 31, 2024, the Company also sold: (i) a portfolio of 59 outpatient medical buildings for $674 million and provided the buyer with a mortgage loan secured by the real estate sold for $405 million (see Note 7), (ii) 12 outpatient medical buildings for $191 million, (iii) a portfolio of seven lab buildings for $180 million, (iv) a portfolio of two outpatient medical buildings for $23 million and provided the buyer with a mortgage loan secured by the real estate sold for $14 million (see Note 7), and (v) a portfolio comprised of a land parcel and various vacant buildings on certain of the Company’s CCRC campuses for $12 million.

Held for Sale

As of March 31, 2025 and December 31, 2024, one outpatient medical building was classified as held for sale, with a carrying value of $8 million, primarily comprised of net real estate assets. As of March 31, 2025 and December 31, 2024, liabilities related to the assets held for sale were zero.

Impairments of Real Estate

During the three months ended March 31, 2025 and 2024, the Company did not recognize any impairment charges.

NOTE 6. Leases

Lease Income

The following table summarizes the Company’s lease income (in thousands):


	Three Months Ended March 31,
	2025		2024
Fixed income from operating leases	$	394,718	$	343,414
Variable income from operating leases	143,423		118,619

Initial Direct Costs

Initial direct costs incurred in connection with successful property leasing are capitalized as deferred leasing costs. Initial direct costs include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained, such as leasing commissions paid to employees and external third-party brokers and lease incentives. Initial direct costs are included in other assets, net in the Consolidated Balance Sheets and amortized in depreciation and amortization in the Consolidated Statements of Operations using the straight-line method over the lease term. At March 31, 2025 and December 31, 2024, the balance of net initial direct costs were $203 million and $204 million, respectively.

Straight-Line Rents

For operating leases with minimum scheduled rent increases, the Company recognizes income on a straight-line basis over the lease term when collectibility of future minimum lease payments is probable. If the Company determines that collectibility of future minimum lease payments is not probable, the straight-line rent receivable balance is written off and recognized as a decrease in revenue in that period and future revenue recognition is limited to amounts contractually owed and paid. The Company does not resume recognition of income on a straight-line basis unless it determines that collectibility of future payments related to these leases is probable. For the Company’s portfolio of operating leases that are deemed probable of collection but exhibit a certain level of collectibility risk, the Company may also recognize an incremental allowance as a reduction to revenue. At March 31, 2025 and December 31, 2024, straight-line rent receivable, net of allowance, was $349 million and $338 million, respectively. Straight-line rent receivable is included in other assets, net in the Consolidated Balance Sheets.

Tenant Updates

On October 26, 2023, the Company amended its lease with Graphite Bio, Inc., which later merged with LENZ Therapeutics, Inc. in March 2024 (“Graphite Bio”), at one of its lab buildings in South San Francisco, California. Under the terms of the amended lease agreement, Graphite Bio’s lease expiration date was accelerated from April 2033 to December 2024 in exchange for an upfront cash payment of $37 million, comprised of a $21 million termination fee and $16 million prepayment of Graphite Bio’s contractual rent through the amended term. The $37 million was recognized as rental and related revenues on the Consolidated Statements of Operations on a straight-line basis through the amended term of the lease.

In July 2024, the Company executed an early lease renewal for approximately 2 million square feet leased by CommonSpirit Health (“CommonSpirit”). The renewal, which is subject to a master agreement, extended the weighted average lease term of existing leases from July 2027 to December 2035, amended the contractual rents to current market rates, and increased the annual contractual lease escalations from 2.5% to 3.0%. In connection with this extension, CommonSpirit was provided the right to reduce the amount of space leased by up to approximately 200,000 square feet at any time after the original lease maturity dates. These termination rights were evaluated for likelihood of exercise in accordance with ASC 842, Leases, in the determination of the lease term. During the three months ended March 31, 2025, CommonSpirit represented 6% of revenues for the outpatient medical segment and 3% of total revenues.

NOTE 7. Loans Receivable

The following table summarizes the Company’s loans receivable (in thousands):


	March 31, 2025		December 31, 2024
Secured loans(1)	$	616,706	$	638,482
CCRC resident loans	60,638		61,273
Mezzanine loans	48,580		50,314
Unamortized discounts and fees	(19,845)		(22,380)
Reserve for loan losses	(7,554)		(10,499)
Loans receivable, net	$	698,525	$	717,190

_______________________________________

(1)At March 31, 2025, the Company had $135 million of remaining commitments to fund additional loans for outpatient medical and lab capital expenditure projects. At December 31, 2024, the Company had $85 million of remaining commitments to fund additional loans for outpatient medical capital expenditure projects.

The Merger

On March 1, 2024, upon the consummation of the Merger, the Company acquired 9 secured loans with an aggregate outstanding principal balance of $89 million and 10 mezzanine loans with an aggregate outstanding principal balance of $36 million, for a total of $124 million. Typically, each secured loan is secured by a mortgage on a related outpatient medical building, each construction loan (included in secured loans above) is secured by a mortgage on the land and improvements as constructed, generally with guarantees from the borrowers, and each mezzanine loan is collateralized by an ownership interest in the respective borrower. As of the Closing Date, the secured loans had maturities ranging from June 2024 to July 2027 and stated fixed interest rates ranging from 7.00% to 10.00%. The mezzanine loans had maturities ranging from June 2024 to June 2027 and stated fixed interest rates ranging from 8.00% to 10.00%.

As of March 31, 2025, unamortized net discounts on the secured loans and mezzanine loans acquired were $0.6 million and $2 million, respectively. As of December 31, 2024, unamortized net discounts on the secured loans and mezzanine loans acquired were $1 million and $2 million, respectively. These discounts are recognized in interest income and other on the Consolidated Statements of Operations using the effective interest rate method over the remaining term of the loans.

Sunrise Senior Housing Portfolio Seller Financing

In conjunction with the sale of 32 senior housing operating properties (“SHOP”) facilities for $664 million in January 2021, the Company provided the buyer with initial financing of $410 million. The remainder of the sales price was received in cash at the time of sale. Additionally, the Company agreed to provide up to $92 million of additional financing for capital expenditures (up to 65% of the estimated cost of capital expenditures). The initial and additional financing is secured by the buyer’s equity ownership in each property.

Subsequent to the initial financing, the Company received partial principal repayments of $291 million and in February 2024, the remaining balance of $131 million reached its maturity and was refinanced with the Company. In connection with the refinance, the Company received a partial principal repayment of $69 million and the maturity date was extended to August 2027. The interest rate on the loan is Term Secured Overnight Financing Rate (“SOFR”) (plus a 10 basis point adjustment related to SOFR transition) plus 4.0% for the first two years of the extended term, and 5.0% for the last 18 months of the extended term, and is subject to a fixed floor of 9%. In May 2024, the Company received a partial principal repayment of $5 million in conjunction with the disposition of underlying collateral. At each of March 31, 2025 and December 31, 2024, this secured loan had an outstanding principal balance of $58 million and the Company had no commitment to provide the borrower with additional financing for capital expenditures.

Other SHOP Seller Financing

In conjunction with the sale of 16 additional SHOP facilities for $230 million in January 2021, the Company provided the buyer with financing of $150 million. The remainder of the sales price was received in cash at the time of sale. The financing was secured by the buyer’s equity ownership in each property.

During the term of the loan, the Company received partial principal repayments of $102 million, and the remaining $48 million was most recently refinanced with the Company in January 2024 at which time the maturity date was extended to January 2025. The interest rate on the loan was Term SOFR (plus an 11 basis point adjustment related to SOFR transition) plus 7.0%, and was subject to a fixed floor of 12%. The Company also received a $1 million extension fee in connection with the refinance, which was recognized in interest income over the remaining term of the loan. In January 2025, the Company received full repayment of the outstanding balance of this seller financing.

Outpatient Medical Seller Financing

In conjunction with the sale of 59 outpatient medical buildings for $674 million in July 2024 and the 2 outpatient medical buildings for $23 million in November 2024 (see Note 5), the Company provided the buyer with a mortgage loan secured by the real estate sold for $405 million and $14 million, respectively. The remainder of the sales price was received in cash at the time of sales. The seller financing has an initial term that matures in July 2026 and includes two 12-month extension options. The interest rate on the seller financing is fixed at 6.0% for the initial term and increases to 6.5% during the optional extension periods. The Company also received a $1 million loan origination fee in connection with the loan, which is being recognized in interest income over the remaining term of the loan. In connection with this seller financing, the Company reduced the gain on sales of real estate and recognized a mark-to-market discount of $21 million during the year ended December 31, 2024. This discount is based on the difference between the stated interest rate and the corresponding prevailing market rate as of the transaction date. The discount is recognized as interest income over the term of the discounted loan using the effective interest rate method. During the three months ended March 31, 2025, the Company recognized $2 million of non-cash interest income related to the amortization of this mark-to-market discount. As of March 31, 2025 and December 31, 2024, the unamortized mark-to-market discount was $17 million and $18 million, respectively.

2025 Other Loans Receivable Transactions

In January 2025, the Company entered into a secured loan to provide up to $75 million to fund a portion of the acquisition and redevelopment of a lab building on a campus in San Diego, California. The initial term of this secured loan matures in January 2029 and includes one 12-month extension option. The stated fixed interest rate of this secured loan is 8%. During the three months ended March 31, 2025, the Company provided initial funding of $28 million under this agreement.

In January 2025, the Company received full repayment of the outstanding balance of one $15 million secured loan with an original maturity of July 2027.

In January 2025, the Company received full repayment of the outstanding balance of one $1 million mezzanine loan with a maturity of June 2025.

In March 2025, the Company entered into an agreement to provide aggregate financing of $41 million to fund the development of an outpatient medical building in Dallas, Texas. The initial term of this financing matures in March 2028 and includes two 12-month extension options. The aggregate interest rate of this financing is 8.3%. During the three months ended March 31, 2025, the Company provided initial funding of $4 million under this agreement.

2024 Other Loans Receivable Transactions

During the year ended December 31, 2024, the Company entered into and funded a $15 million mezzanine loan with a fixed interest rate of 11.00%.

Additionally, during the year ended December 31, 2024, the Company entered into a construction loan agreement to provide up to $36 million to fund a portion of the construction of an outpatient medical building. This secured loan matures in December 2028 and has a stated fixed interest rate of 8.00%. At each of March 31, 2025 and December 31, 2024, there were no fundings under this agreement.

CCRC Resident Loans

For certain residents that qualify, CCRCs may offer to lend residents the necessary funds to satisfy the entrance fee requirements so that they are able to move into a community while still continuing the process of selling their previous home. The loans are due upon sale of the resident’s previous home. At each of March 31, 2025 and December 31, 2024, the Company held $61 million of such notes receivable.

Loans Receivable Internal Ratings

In connection with the Company’s quarterly review process or upon the occurrence of a significant event, loans receivable are reviewed and assigned an internal rating of Performing, Watch List, or Workout. Loans that are deemed Performing meet all present contractual obligations, and collection and timing of all amounts owed is reasonably assured. Watch List Loans are defined as loans that do not meet the definition of Performing or Workout. Workout Loans are defined as loans in which the Company has determined, based on current information and events, that: (i) it is probable it will be unable to collect all amounts due according to the contractual terms of the agreement, (ii) the borrower is delinquent on making payments under the contractual terms of the agreement, and (iii) the Company has commenced action or anticipates pursuing action in the near term to seek recovery of its investment.

The following table summarizes, by year of origination, the Company’s internal ratings for loans receivable, net of unamortized discounts, fees, and reserves for loan losses, as of March 31, 2025 (in thousands):


Investment Type		Year of Origination(1)																	Total
	2025			2024			2023			2022			2021			Prior
Secured loans
Risk rating:
Performing loans		$	31,575		$	436,138		$	43,839		$	25,789		$	57,576		$	—	$	594,917
Watch list loans		—			—			—			—			—			—		—
Workout loans		—			—			—			—			—			—		—
Total secured loans		$	31,575		$	436,138		$	43,839		$	25,789		$	57,576		$	—	$	594,917
Current period gross write-offs		$	—		$	—		$	—		$	—		$	—		$	—	$	—
Current period recoveries		—			—			—			—			—			—		—
Current period net write-offs		$	—		$	—		$	—		$	—		$	—		$	—	$	—
Mezzanine loans
Risk rating:
Performing loans		$	—		$	13,566		$	5,411		$	4,557		$	6,753		$	12,683	$	42,970
Watch list loans		—			—			—			—			—			—		—
Workout loans		—			—			—			—			—			—		—
Total mezzanine loans		$	—		$	13,566		$	5,411		$	4,557		$	6,753		$	12,683	$	42,970
Current period gross write-offs		$	—		$	—		$	—		$	—		$	—		$	—	$	—
Current period recoveries		—			—			—			—			—			—		—
Current period net write-offs		$	—		$	—		$	—		$	—		$	—		$	—	$	—
CCRC resident loans
Risk rating:
Performing loans		$	19,325		$	40,974		$	179		$	160		$	—		$	—	$	60,638
Watch list loans		—			—			—			—			—			—		—
Workout loans		—			—			—			—			—			—		—
Total CCRC resident loans		$	19,325		$	40,974		$	179		$	160		$	—		$	—	$	60,638
Current period gross write-offs		$	—		$	—		$	—		$	—		$	—		$	—	$	—
Current period recoveries		—			—			—			—			—			—		—
Current period net write-offs		$	—		$	—		$	—		$	—		$	—		$	—	$	—

_______________________________________

(1)Additional fundings under existing loans are included in the year of origination of the initial loan.

Reserve for Loan Losses

The Company evaluates the liquidity and creditworthiness of its borrowers on a quarterly basis to determine whether any updates to the future expected losses recognized upon inception are necessary. The Company’s evaluation considers payment history and current credit status, industry conditions, current economic conditions, forecasted economic conditions, individual and portfolio property performance, credit enhancements, liquidity, and other factors. Future economic conditions are based primarily on near-term economic forecasts from the Federal Reserve and reasonable assumptions for long-term economic trends. The determination of loan losses also considers concentration of credit risk associated with the senior housing, outpatient medical, and lab industries to which its loans receivable relate. The Company’s borrowers furnish property, portfolio, and guarantor/operator-level financial statements, among other information, on a monthly or quarterly basis; the Company utilizes this financial information to calculate the debt service coverages in its assessment of internal ratings that it uses as a primary credit quality indicator. Debt service coverage information is evaluated together with other property, portfolio, and operator performance information, including revenue, expense, net operating income, occupancy, rental rates, capital expenditures, and EBITDA (defined as earnings before interest, tax, and depreciation and amortization), along with other liquidity measures. The Company evaluates, on a monthly basis or immediately upon a significant change in circumstance, its borrowers’ ability to service their obligations with the Company.

The following table summarizes the Company’s reserve for loan losses (in thousands):


	March 31, 2025				December 31, 2024
	Secured Loans		Mezzanine Loans and Other(1)		Total		Secured Loans		Mezzanine Loans and Other(1)		Total
Reserve for loan losses, beginning of period	$	5,574	$	4,925	$	10,499	$	2,830	$	—	$	2,830

Provision for expected loan losses (recoveries) on funded loans receivable	(1,077)		(914)		(1,991)		2,744		4,925		7,669
Expected loan losses (recoveries) related to loans sold or repaid	(783)		(171)		(954)		—		—		—



Reserve for loan losses, end of period	$	3,714	$	3,840	$	7,554	$	5,574	$	4,925	$	10,499

_______________________________________

(1)Includes CCRC resident loans.

Additionally, at March 31, 2025 and December 31, 2024, a liability of $2.2 million and $2.9 million, respectively, related to expected credit losses for unfunded loan commitments was included in accounts payable, accrued liabilities, and other liabilities.

The change in the reserve for expected loan losses during the three months ended March 31, 2025 is primarily due to: (i) changes in operating performance and fair values of the underlying collateral of the Company’s loans receivable and (ii) recoveries related to loans repaid during the three months ended March 31, 2025, partially offset by reserves recognized on new secured loans executed during the three months ended March 31, 2025.

NOTE 8. Investments in and Advances to Unconsolidated Joint Ventures

The Company owns interests in the following entities that are accounted for under the equity method (dollars in thousands):


				Carrying Amount
				March 31,		December 31,
Entity(1)	Segment	Property Count(2)	Ownership %(2)	2025		2024
South San Francisco JVs(3)	Lab	7	70	$	446,437	$	446,145
SWF SH JV	Other	19	54	319,722		322,551
Callan Ridge JV	Lab	2	35	68,671		69,709
Lab JV	Lab	1	49	32,681		29,916
PMAK JV(4)	Outpatient medical	59	12	29,218		32,511
HQ Point Preferred Equity Investment(4)	Other	2	19	21,743		—
Needham Land Parcel JV(5)	Lab	—	38	21,157		21,348
Outpatient Medical JVs(6)	Outpatient medical	2	20 - 67	7,245		7,199
Davis JV	Outpatient medical	15	49	5,104		7,435
				$	951,978	$	936,814

_______________________________________

(1)These entities are not consolidated because the Company does not control, through voting rights or other means, the joint ventures.

(2)Property counts and ownership percentages are as of March 31, 2025.

(3)Includes multiple unconsolidated lab joint ventures in South San Francisco, California in which the Company holds a 70% ownership percentage in each joint venture. The Company is entitled to a preferred return, a promote, and certain fees in exchange for development and asset management services provided to these joint ventures when certain conditions are met. These joint ventures have been aggregated herein due to similarity of the investments and operations.

(4)The properties underlying the PMAK JV and HQ Point Preferred Equity Investment are excluded from the Company’s total property count.

(5)Land held for development is excluded from the property count as of March 31, 2025.

(6)Includes two unconsolidated outpatient medical joint ventures in which the Company holds an ownership percentage as follows: (i) Ventures IV (20%) and (ii) Suburban Properties, LLC (67%). These joint ventures have been aggregated herein due to similarity of the investments and operations.

HQ Point Preferred Equity Investment

In February 2025, the Company made a preferred equity investment in a joint venture that holds a lab campus under development in San Diego, California. This investment is entitled to a preferred return, and the Company has committed to fund up to a total investment of $50 million. As of March 31, 2025, the Company has funded $21 million of its investment.

Callan Ridge JV

In January 2024, the Company sold a 65% interest in two lab buildings in San Diego, California (the “Callan Ridge JV”) to a third-party (the “JV Partner”) for net proceeds of $128 million. Following the transaction, the Company and the JV Partner share in key decisions of the assets through their voting rights, resulting in the Company deconsolidating the assets, recognizing its retained 35% investment in the Callan Ridge JV at fair value, and accounting for its investment using the equity method. The fair value of the Company’s retained investment at the time of the transaction was based on a market approach, utilizing an agreed-upon contractual sales price, which is considered to be a Level 3 measurement within the fair value hierarchy. During the three months ended March 31, 2024, the Company recognized a gain upon change of control of $78 million, which is recorded in other income (expense), net.

NOTE 9. Intangibles

Intangible assets primarily consist of lease-up intangibles and above market lease intangibles. The following table summarizes the Company’s intangible lease assets (dollars in thousands):


Intangible lease assets	March 31, 2025		December 31, 2024
Gross intangible lease assets(1)	$	1,462,764	$	1,468,985
Accumulated depreciation and amortization(2)	(714,975)		(651,731)
Intangible assets, net	$	747,789	$	817,254

Weighted average remaining amortization period in years	5		5

_______________________________________

(1)At each of March 31, 2025 and December 31, 2024, includes $1.42 billion of gross lease-up intangibles and at March 31, 2025 and December 31, 2024, includes $44 million and $45 million, respectively, of gross above market lease intangibles.

(2)At March 31, 2025 and December 31, 2024, includes $702 million and $640 million, respectively, of accumulated depreciation and amortization on lease-up intangibles and $13 million and $12 million, respectively, of accumulated depreciation and amortization on above market lease intangibles.

Intangible liabilities consist of below market lease intangibles. The following table summarizes the Company’s intangible lease liabilities (dollars in thousands):


Intangible lease liabilities	March 31, 2025		December 31, 2024
Gross intangible lease liabilities	$	316,196	$	351,602
Accumulated depreciation and amortization	(137,194)		(159,718)
Intangible liabilities, net	$	179,002	$	191,884

Weighted average remaining amortization period in years	9		9

During the three months ended March 31, 2025, in conjunction with the Company’s acquisition of real estate, the Company acquired $3 million of intangible assets with a weighted average amortization period at acquisition of 13 years.

On the Closing Date of the Merger, the Company acquired intangible assets of $891 million, inclusive of $852 million of lease-up intangibles and $39 million of above market lease intangibles. Also on the Closing Date of the Merger, the Company assumed intangible liabilities of $150 million (see Note 3). The intangible assets and liabilities acquired had a weighted average amortization period at acquisition of 6 years and 9 years, respectively.

Goodwill

In connection with the Merger, the Company recognized goodwill of $51 million, which was allocated to the Company’s outpatient medical segment (see Note 3). Goodwill is included in other assets, net on the Consolidated Balance Sheets. At March 31, 2025 and December 31, 2024, goodwill was allocated to the Company’s segment assets as follows (in thousands):


Segment	March 31, 2025		December 31, 2024
Outpatient medical	$	64,680	$	64,680
CCRC	1,998		1,998
Other non-reportable	1,851		1,851

	$	68,529	$	68,529

NOTE 10. Debt

Healthpeak OP, the Company’s consolidated operating subsidiary, is the borrower under, and the Company, DOC DR Holdco, and DOC DR OP Sub are the guarantors of, the Revolving Facility, 2027 Term Loans, 2029 Term Loan, Commercial Paper Program (each as defined below), and senior unsecured notes issued by the Company prior to the Merger. DOC DR OP Sub is the borrower under, and the Company, Healthpeak OP, and DOC DR Holdco are guarantors of, the 2028 Term Loan (as defined below) and senior unsecured notes issued by the Physicians Partnership prior to, and assumed by the Company as part of, the Merger. Guarantees of senior unsecured notes are full and unconditional and applicable to existing and future senior unsecured notes.

The Merger

On March 1, 2024, upon the consummation of the Merger, the Company assumed senior unsecured term loans in an aggregate principal amount of $400 million (the “2028 Term Loan”) that mature in May 2028 (see Note 3) pursuant to an amendment to a term loan agreement originally executed by the Physicians Partnership, as borrower, and the other parties thereto. DOC DR OP Sub is the borrower under, and the Company, Healthpeak OP, and DOC DR Holdco are guarantors of, the 2028 Term Loan.

In connection with the assumption of the 2028 Term Loan, the Company acquired three related interest rate swap instruments that were redesignated as cash flow hedges as of the Closing Date. The 2028 Term Loan associated with these interest rate swap instruments is reported as fixed rate debt due to the Company having effectively established a fixed interest rate for the underlying debt instruments. Based on DOC DR OP Sub’s credit ratings as of March 31, 2025, the 2028 Term Loan had a blended fixed effective interest rate of 4.44%, inclusive of the impact of these interest rate swap instruments and amortization of the related premium. See also Note 18 for a discussion of the impact of the related interest rate swap instruments.

Loans outstanding under the 2028 Term Loan bear interest at an annual rate equal to (i) the applicable margin, plus (ii) Daily SOFR (plus a 10 basis point adjustment related to SOFR transition). The applicable margin under the 2028 Term Loan ranges from 0.85% to 1.65% for Daily SOFR loans and is based on the credit ratings of DOC DR OP Sub. Based on the Company’s credit ratings as of March 31, 2025, and inclusive of the adjustment related to SOFR transition, the margin on the 2028 Term Loan was 1.00%.

Additionally, on March 1, 2024, concurrently with the consummation of the Merger, DOC DR OP Sub assumed, and the Company and Healthpeak OP guaranteed, Physicians Partnership’s $1.25 billion aggregate principal of senior unsecured notes (see Note 3), including: (i) $400 million aggregate principal amount of 4.30% senior unsecured notes due 2027, (ii) $350 million aggregate principal amount of 3.95% senior unsecured notes due 2028, and (iii) $500 million aggregate principal amount of 2.63% senior unsecured notes due 2031. On the Closing Date, the Company capitalized $1 million of costs paid to the bondholders, which are being amortized into interest expense on the Consolidated Statements of Operations over the terms of the related senior unsecured notes. The senior unsecured notes contain certain covenants that are consistent with Healthpeak OP’s previously issued senior unsecured notes, as further described below.

Lastly, on March 1, 2024, concurrently with the consummation of the Merger, the Company assumed $128 million aggregate principal of mortgage debt (see Note 3), which was secured by five outpatient medical buildings, with an aggregate carrying value of $259 million as of March 1, 2024. Of this $128 million, $59 million was fixed rate debt with a weighted average contractual interest rate of 3.77% and maturities ranging from November 2024 through December 2026 and $69 million was variable rate debt with a weighted average contractual interest rate of 7.25% and maturities ranging from December 2026 through November 2028. The Company recognized a net discount of $0.5 million on the $128 million aggregate principal of mortgage debt assumed on the Closing Date, which is being amortized into interest expense on the Consolidated Statements of Operations using the effective interest rate method. The Company acquired one related interest rate swap instrument with a notional amount of $36 million of variable rate mortgage debt that was redesignated as a cash flow hedge as of the Closing Date (see Note 18), which matured in October 2024.

Bank Line of Credit and Term Loans

Revolving Facility

On May 23, 2019, the Company executed a $2.5 billion unsecured revolving line of credit facility, with a maturity date of May 23, 2023 and two six-month extension options, subject to certain customary conditions. In September 2021, the Company executed an amended and restated unsecured revolving line of credit (the “Revolving Facility”) to increase total revolving commitments from $2.5 billion to $3.0 billion and extend the maturity date to January 20, 2026 with two six-month extension options, subject to certain customary conditions. On February 10, 2023, the Company executed an amendment to the Revolving Facility to convert the interest rate benchmark from the London Interbank Offered Rate (“LIBOR”) to SOFR. On March 1, 2024, concurrently with the consummation of the Merger, the Company executed an amendment to the Revolving Facility to, among other things, join DOC DR Holdco and DOC DR OP Sub as guarantors of Healthpeak OP’s obligations under the Revolving Facility. In December 2024, the Company amended and restated its Revolving Facility to extend the maturity date to January 19, 2029. This maturity date may be further extended pursuant to two six-month extension options, subject to certain customary conditions. Borrowings under the Revolving Facility accrue interest at the applicable interest rate benchmark plus a margin that depends on the credit ratings of the Company’s senior unsecured long-term debt. The Company also pays a facility fee on the entire revolving commitment that depends on its credit ratings. Based on the Company’s credit ratings at March 31, 2025, and inclusive of a 10 basis point adjustment related to SOFR transition, the margin on the Revolving Facility was 0.88% and the facility fee was 0.15%. The Revolving Facility includes a feature that allows the Company to increase the borrowing capacity by an aggregate amount of up to $750 million, subject to securing additional commitments. At each of March 31, 2025 and December 31, 2024, the Company had no balance outstanding under the Revolving Facility.

Term Loan Agreement

On August 22, 2022, the Company executed a term loan agreement (as amended or modified as described herein, the “Term Loan Agreement”) that provided for two senior unsecured delayed draw term loans in an aggregate principal amount of up to $500 million (the “2027 Term Loans”). The 2027 Term Loans were available to be drawn from time to time during a 180-day period after closing, subject to customary borrowing conditions, and the Company drew the entirety of the $500 million under the 2027 Term Loans in October 2022. $250 million of the 2027 Term Loans have an initial stated maturity of 4.5 years, which may be extended for a one-year period subject to certain customary conditions. The other $250 million of the 2027 Term Loans has a stated maturity of five years with no option to extend.

Loans outstanding under the 2027 Term Loans accrue interest at Term SOFR plus a margin that depends on the credit ratings of the Company’s senior unsecured long-term debt. The 2027 Term Loans also include a sustainability-linked pricing component whereby the applicable margin under the 2027 Term Loans may be reduced by 0.01% based on the Company’s achievement of specified sustainability-linked metrics. Based on the Company’s credit ratings as of March 31, 2025, and inclusive of achievement of a sustainability-linked metric and an adjustment related to SOFR transition, the margin on the 2027 Term Loans was 0.94%.

In August 2022, the Company entered into two forward-starting interest rate swap instruments that are designated as cash flow hedges (see Note 18). The 2027 Term Loans associated with these interest rate swap instruments are reported as fixed rate debt due to the Company having effectively established a fixed interest rate for the underlying debt instruments. Based on the Company’s credit ratings as of March 31, 2025, the 2027 Term Loans had a blended fixed effective interest rate of 3.76%, inclusive of the impact of these interest rate swap instruments and amortization of the related debt issuance costs.

On March 1, 2024, concurrently with the consummation of the Merger, the Company executed an amendment to the Term Loan Agreement pursuant to which (i) the maximum incremental borrowing capacity under the Term Loan Agreement was increased from $1.0 billion to $1.5 billion, subject to securing additional commitments, (ii) the Company borrowed senior unsecured term loans in an aggregate principal amount of $750 million with a stated maturity of five years (the “2029 Term Loan”), and (iii) DOC DR Holdco and DOC DR OP Sub were joined as guarantors of Healthpeak OP’s obligations under the Term Loan Agreement. As of March 31, 2025, the unused borrowing capacity under the Term Loan Agreement was $250 million.

Loans outstanding under the 2029 Term Loan accrue interest at Daily SOFR plus a margin that depends on the credit ratings of the Company’s senior unsecured long-term debt. Based on the Company’s credit ratings as of March 31, 2025, and inclusive of an adjustment related to SOFR transition, the margin on the 2029 Term Loan was 0.95%.

In January 2024, the Company entered into forward-starting interest rate swap instruments that are designated as cash flow hedges (see Note 18). The 2029 Term Loan associated with these interest rate swaps is reported as fixed rate debt due to the Company having effectively established a fixed interest rate for the underlying debt instruments. Based on the Company’s credit ratings as of March 31, 2025, the 2029 Term Loan had a blended fixed effective interest rate of 4.66%, inclusive of the impact of these interest rate swap instruments and amortization of the related debt issuance costs.

At each of March 31, 2025 and December 31, 2024, the Company had $1.25 billion of loans outstanding under the Term Loan Agreement.

The Revolving Facility, 2027 Term Loans, 2028 Term Loan, and 2029 Term Loan are subject to certain financial restrictions and other customary requirements, including financial covenants and cross-default provisions to other indebtedness. Among other things, these covenants, using terms defined in the applicable agreement: (i) limit the ratio of Enterprise Total Indebtedness to Enterprise Gross Asset Value to 60%; (ii) limit the ratio of Enterprise Secured Debt to Enterprise Gross Asset Value to 40%; (iii) limit the ratio of Enterprise Unsecured Debt to Enterprise Unencumbered Asset Value to 60%; (iv) require a minimum Fixed Charge Coverage ratio of 1.5 times; and (v) require a minimum Consolidated Tangible Net Worth of $7.7 billion. The Company believes it was in compliance with each of these covenants at March 31, 2025.

Commercial Paper Program

In September 2019, the Company established an unsecured commercial paper program (the “Commercial Paper Program”). Under the terms of the Commercial Paper Program, the Company may issue, from time to time, short-term unsecured notes with varying maturities. Amounts available under the Commercial Paper Program may be borrowed, repaid, and re-borrowed from time to time. At each of March 31, 2025 and December 31, 2024, the maximum aggregate face or principal amount that could be outstanding at any one time was $2.0 billion. Amounts borrowed under the Commercial Paper Program will be sold on terms that are customary for the U.S. commercial paper market and will be at least equal in right of payment with all of the Company’s other unsecured and unsubordinated indebtedness. The Company uses its Revolving Facility as a liquidity backstop for the repayment of short-term unsecured notes issued under the Commercial Paper Program. During each of the three months ended March 31, 2025 and 2024, the Company recognized $2 million of interest expense related to fees and amortization of debt issuance costs related to its Commercial Paper Program and Revolving Facility. At March 31, 2025, the Company had $164 million notes outstanding under the Commercial Paper Program, with original maturities of approximately 18 days and a weighted average interest rate of 4.70%. At December 31, 2024, the Company had $150 million of notes outstanding under the Commercial Paper Program, with original maturities of approximately 25 days and a weighted average interest rate of 4.65%.

Senior Unsecured Notes

At March 31, 2025 and December 31, 2024, the Company had senior unsecured notes outstanding with an aggregate principal balance of $6.9 billion and $6.7 billion, respectively. The senior unsecured notes contain certain covenants including limitations on debt, maintenance of unencumbered assets, cross-acceleration provisions, and other customary terms. The Company believes it was in compliance with these covenants at March 31, 2025.

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


Issue Date	Amount		Coupon Rate(1)		Maturity Year
February 14, 2025	$	500,000	5.38	%	2035

_______________________________________

(1)The effective interest rate, which includes amortization of debt premiums (discounts) and debt issuance costs, is 5.56%.

The following table summarizes the Company’s senior unsecured note repayments during the three months ended March 31, 2025 (dollars in thousands):


Repayment Date						Amount						Coupon Rate(1)						Maturity Year
February 3, 2025						$	348,194					3.40		%				2025

_______________________________________

(1)The effective interest rate, which includes amortization of debt premiums (discounts) and debt issuance costs, was 3.58%.

During the year ended December 31, 2024, there were no issuances, repurchases, or redemptions of senior unsecured notes; however, as described above, concurrently with the consummation of the Merger, the Company assumed $1.25 billion aggregate principal of senior unsecured notes.

Mortgage Debt

At March 31, 2025 and December 31, 2024, the Company had $351 million and $356 million, respectively, in aggregate principal of mortgage debt outstanding. At March 31, 2025, this mortgage debt was secured by 18 outpatient medical buildings and 2 CCRCs, with an aggregate carrying value of $749 million. At December 31, 2024, this mortgage debt was secured by 19 outpatient medical buildings and 2 CCRCs, with an aggregate carrying value of $770 million.

Mortgage debt generally requires monthly principal and interest payments, is collateralized by real estate assets, and is non-recourse. Mortgage debt typically requires maintenance of the assets in good condition, includes conditions to obtain lender consent to enter into or terminate material leases, requires insurance on the assets, requires payment of real estate taxes, restricts transfer of the encumbered assets and repayment of the loan, and prohibits additional liens. Some of the mortgage debt may require tenants or operators to maintain compliance with the applicable leases or operating agreements of such real estate assets.

During the three months ended March 31, 2025 and 2024, the Company made aggregate principal repayments of mortgage debt of $5 million and $1 million, respectively. Included in the $5 million of aggregate principal payments of mortgage debt for the three months ended March 31, 2025 was a $4 million full principal repayment of mortgage debt secured by one outpatient medical building that matured in March 2025.

The Company has $142 million of mortgage debt secured by a portfolio of 13 outpatient medical buildings that matures in May 2026. In April 2022, the Company terminated its existing interest rate cap instruments associated with this variable rate mortgage debt and entered into two interest rate swap instruments that are designated as cash flow hedges and mature in May 2026. In February 2023, the agreements associated with this variable rate mortgage debt were amended to change the interest rate benchmarks from LIBOR to SOFR, effective March 2023. Concurrently, the Company modified the related interest rate swap instruments to reflect the change in the interest rate benchmarks from LIBOR to SOFR (see Note 18). The variable rate mortgage debt associated with these interest rate swap instruments is reported as fixed rate debt due to the Company having effectively established a fixed interest rate for the underlying debt instrument.

Debt Maturities

The following table summarizes the Company’s stated debt maturities and scheduled principal repayments at March 31, 2025 (dollars in thousands):


							Senior Unsecured Notes(3)				Mortgage Debt(4)
Year	Bank Line of Credit(1)		Commercial Paper(1)(2)		Term Loans		Amount		Interest Rate(5)		Amount		Interest Rate(5)		Total
2025	$	—	$	—	$	—	$	451,806	4.19	%	$	2,762	3.95	%	$	454,568
2026	—		—		—		650,000		3.40	%	344,999		5.07	%	994,999
2027	—		—		500,000		850,000		3.23	%	842		5.29	%	1,350,842
2028	—		—		400,000		850,000		3.53	%	2,775		4.82	%	1,252,775
2029	—		164,000		750,000		650,000		3.65	%	—		—	%	1,564,000
Thereafter	—		—		—		3,400,000		4.66	%	—		—	%	3,400,000
	—		164,000		1,650,000		6,851,806				351,378				9,017,184
Premiums, (discounts), and debt issuance costs, net	—		—		(3,665)		(137,527)				673				(140,519)


	$	—	$	164,000	$	1,646,335	$	6,714,279			$	352,051			$	8,876,665

_______________________________________

(1)As of March 31, 2025, total unamortized debt issuance costs for the Revolving Facility and Commercial Paper Program were $17 million, which are recorded in other assets, net on the Consolidated Balance Sheets.

(2)Commercial Paper Program borrowings are backstopped by the availability under the Revolving Facility. As such, the Company calculates the weighted average remaining term of its Commercial Paper Program borrowings using the maturity date of the Revolving Facility.

(3)Effective interest rates on the senior unsecured notes range from 1.54% to 6.87% with a weighted average effective interest rate of 4.10% and a weighted average maturity of approximately 5 years.

(4)Effective interest rates on the mortgage debt range from 3.44% to 7.31% with a weighted average effective interest rate of 5.06% and a weighted average maturity of approximately 1.5 years. These interest rates include the impact of designated interest rate swap instruments, which effectively fix the interest rate on certain variable rate debt.

(5)Represents the weighted-average effective interest rate as of the end of the applicable period, including amortization of debt premiums (discounts) and debt issuance costs.

Additionally, as of March 31, 2025, the Company had 17 outstanding letter of credit obligations totaling $17 million.

NOTE 11. Commitments and Contingencies

Legal Proceedings

From time to time, the Company is a party to legal proceedings, lawsuits and other claims that arise in the ordinary course of the Company’s business. The Company is not aware of any legal proceedings or claims that it believes may have, individually or taken together, a material adverse effect on the Company’s financial condition, results of operations, or cash flows. The Company’s policy is to expense legal costs as they are incurred.

DownREITs and Other Partnerships

In connection with the formation of certain limited liability companies (“DownREITs”), members may contribute appreciated real estate to a DownREIT in exchange for DownREIT units. These contributions are generally tax-deferred, so that the pre-contribution gain related to the property is not taxed to the member. However, if a contributed property is later sold by the DownREIT, the unamortized pre-contribution gain that exists at the date of sale is specifically allocated and taxed to the contributing members. In many of the DownREITs, the Company has entered into indemnification agreements with those members who contributed appreciated property into the DownREIT. Under these indemnification agreements, if any of the appreciated real estate contributed by the members is sold by the DownREIT in a taxable transaction within a specified number of years, the Company will reimburse the affected members for the federal and state income taxes associated with the pre-contribution gain that is specially allocated to the affected member under the Internal Revenue Code (“make-whole payments”). These make-whole payments include a tax gross-up provision. As of March 31, 2025, the Company had indemnification agreements on a total of 28 properties within its DownREITs.

Additionally, the Company owns a 49% interest in the Lab JV (see Note 8). If the property in the joint venture is sold in a taxable transaction, the Company is generally obligated to indemnify its joint venture partner for its federal and state income taxes associated with the gain that existed at the time of the contribution to the joint venture.

NOTE 12. Equity and Redeemable Noncontrolling Interests

Dividends

On April 4, 2025, the Company’s Board of Directors declared a monthly common stock cash dividend of $0.10167 per share for the months of April, May, and June 2025, payable on April 30, 2025, May 30, 2025, and June 27, 2025, respectively, to stockholders of record as of the close of business on April 18, 2025, May 19, 2025, and June 16, 2025, respectively.

During the three months ended March 31, 2025 and 2024, the Company declared and paid common stock cash dividends of $0.305 and $0.300 per share, respectively.

Issuance of Common Stock in Connection with the Merger

Pursuant to the terms set forth in the Merger Agreement, on the Closing Date, each outstanding share of Physicians Realty Trust (other than Physicians Realty Trust common shares that were canceled in accordance with the Merger Agreement) automatically converted into the right to receive 0.674 shares of the Company’s common stock. Based on the number of outstanding Physicians Realty Trust common shares as of the Closing Date, the Company issued 162 million shares of common stock. Refer to Note 3 for additional information regarding the Merger.

At-The-Market Equity Offering Program

In February 2023, the Company terminated the previous at-the-market equity offering program (as amended from time to time, the “2020 ATM Program”) and established a new at-the-market equity offering program (the “2023 ATM Program” and, together with the 2020 ATM Program, the “ATM Programs”). The 2023 ATM Program was amended in: (i) March 2024 to contemplate the sale of the remaining shares of common stock pursuant to the Company’s Registration Statement on Form S-3 filed with the SEC on February 8, 2024 and (ii) each of May 2024 and February 2025 to add certain banks as sales agents, a forward seller, and a forward purchaser under the 2023 ATM Program. The ATM Programs allow for the sale of shares of common stock having an aggregate gross sales price of up to $1.5 billion (i) by the Company through a consortium of banks acting as sales agents or directly to the banks acting as principals or (ii) by a consortium of banks acting as forward sellers on behalf of any forward purchasers pursuant to a forward sale agreement (each, an “ATM forward contract”). The use of ATM forward contracts allows the Company to lock in a share price on the sale of shares at the time the ATM forward contract becomes effective, but defer receiving the proceeds from the sale of shares until a later date.

ATM forward contracts generally have a one- to two-year term. At any time during the term, the Company may settle a forward sale by delivery of physical shares of common stock to the forward seller or, at the Company’s election, in cash or net shares. The forward sale price the Company expects to receive upon settlement of outstanding ATM forward contracts will be the initial forward price established upon the effective date, subject to adjustments for: (i) accrued interest, (ii) the forward purchasers’ stock borrowing costs, and (iii) certain fixed price reductions during the term of the ATM forward contract.

At March 31, 2025, $1.5 billion of the Company’s common stock remained available for sale under the 2023 ATM Program.

ATM Forward Contracts

During each of the three months ended March 31, 2025 and 2024, the Company did not utilize the forward provisions under the ATM Programs.

ATM Direct Issuances

During each of the three months ended March 31, 2025 and 2024, there were no direct issuances of shares of common stock under the ATM Programs.

Share Repurchase Programs

On August 1, 2022, the Company’s Board of Directors approved a share repurchase program under which the Company could acquire shares of its common stock in the open market up to an aggregate purchase price of $500 million (the “2022 Share Repurchase Program”). Purchases of common stock under the 2022 Share Repurchase Program could be exercised at the Company’s discretion with the timing and number of shares repurchased depending on a variety of factors, including price, corporate and regulatory requirements, and other corporate liquidity requirements and priorities. Under Maryland General Corporation Law, outstanding shares of common stock acquired by a corporation become authorized but unissued shares, which may be re-issued. During the three months ended March 31, 2024, the Company repurchased 5.8 million shares of its common stock under the 2022 Share Repurchase Program at a weighted average price of $17.11 per share for a total of $100 million. During the year ended December 31, 2024, the Company repurchased 10.5 million shares of its common stock under the 2022 Share Repurchase Program at a weighted average price of $17.98 per share for a total of $188 million.

On July 24, 2024, the Company’s Board of Directors approved a new share repurchase program (the “2024 Share Repurchase Program”) to supersede and replace the 2022 Share Repurchase Program. Upon adoption of the 2024 Share Repurchase Program, no further share repurchases may be made pursuant to the 2022 Share Repurchase Program. Under the 2024 Share Repurchase Program, the Company may acquire shares of its common stock in the open market or other similar purchase techniques (including in compliance with the safe harbor provisions of Rule 10b-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or pursuant to one or more plans adopted under Rule 10b5-1 promulgated under the Exchange Act), up to an aggregate purchase price of $500 million. Purchases of common stock under the 2024 Share Repurchase Program may be exercised at the Company’s discretion with the timing and number of shares repurchased depending on a variety of factors, including price, corporate and regulatory requirements, and other corporate liquidity requirements and priorities. The 2024 Share Repurchase Program expires in July 2026 and may be suspended or terminated at any time without prior notice. During the three months ended March 31, 2025, the Company repurchased 1.15 million shares of its common stock under the 2024 Share Repurchase Program at a weighted average price of $19.45 per share for a total of $22 million. Therefore, at March 31, 2025, $478 million of the Company’s common stock remained available for repurchase under the 2024 Share Repurchase Program.

From April 1, 2025 through April 25, 2025, the Company repurchased an additional 3.94 million shares of its common stock under the 2024 Share Repurchase Program at a weighted average price of $18.22 per share for a total of $72 million.

Accumulated Other Comprehensive Income (Loss)

The following table summarizes the Company’s accumulated other comprehensive income (loss) (in thousands):


	March 31, 2025		December 31, 2024

Unrealized gains (losses) on derivatives, net	$	8,746	$	30,707
Supplemental Executive Retirement Plan minimum liability	(1,819)		(1,889)

Total accumulated other comprehensive income (loss)	$	6,927	$	28,818

The Company has a defined benefit pension plan, known as the Supplemental Executive Retirement Plan, with one plan participant, a former Chief Executive Officer (“CEO”) of the Company who departed in 2003. Changes to the Supplemental Executive Retirement Plan minimum liability are reflected in other comprehensive income (loss).

Noncontrolling Interests

Redeemable Noncontrolling Interests

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. Certain of the Company’s noncontrolling interest holders have the ability to put their equity interests to the Company after the passage of a predetermined period of time (the “Put Option”). Each put option is payable in cash and subject to changes in redemption value, which is generally based on the underlying property’s fair value. Accordingly, the Company records redeemable noncontrolling interests outside of permanent equity and presents the redeemable noncontrolling interests at the greater of their carrying amount or redemption value at the end of each reporting period. In addition to the rights of the redeemable noncontrolling interest holders, the Company has the ability to buy out the interests of certain noncontrolling interest holders. The values of the redeemable noncontrolling interests are subject to change based on the assessment of redemption value at each redemption date. The Put Option is currently exercisable for $12 million of these interests, and the remaining $3 million will become exercisable during the second half of 2025.

In April 2024, the Company exercised its option to buy out four redeemable noncontrolling interests that met the criteria for redemption. Accordingly, during the three months ended June 30, 2024, the Company made aggregate cash payments for the total redemption value of $53 million to the related noncontrolling interest holders and acquired the redeemable noncontrolling interests associated with the entities.

Healthpeak OP

During each of the three months ended March 31, 2025 and 2024, certain employees of the Company (“OP Unitholders”) were issued approximately 2 million non-managing member units in Healthpeak OP (“OP Units”), all of which were profits interests in Healthpeak OP. When certain conditions are met, the OP Unitholders have the right to require redemption of part or all of their OP Units for cash or shares of the Company’s common stock, at the Company’s option as managing member of Healthpeak OP. The per unit redemption amount is equal to either one share of the Company’s common stock or cash equal to the fair value of a share of common stock at the time of redemption. The Company classifies the OP Units in permanent equity because it may elect, in its sole discretion, to issue shares of its common stock to OP Unitholders who choose to redeem their OP Units rather than using cash. As of March 31, 2025, there were approximately 5 million OP Units outstanding and 257 thousand had met the criteria for redemption. As of December 31, 2024, there were approximately 3 million OP Units outstanding and 76 thousand had met the criteria for redemption.

DownREITs

The non-managing member units of the Company’s DownREITs are exchangeable for an amount of cash approximating the then-current market value of shares of the Company’s common stock or, at the Company’s option, shares of the Company’s common stock (subject to certain adjustments, such as stock splits and reclassifications). Upon exchange of DownREIT units for the Company’s common stock, the carrying amount of the DownREIT units is reclassified to stockholders’ equity. At each of March 31, 2025 and December 31, 2024, there were approximately 11 million DownREIT units (13 million and 14 million shares of Healthpeak common stock are issuable upon conversion, respectively) outstanding in eight DownREIT LLCs, for all of which the Company holds a controlling interest and/or acts as the managing member. At March 31, 2025 and December 31, 2024, the carrying value of the 11 million DownREIT units was $309 million and $310 million, respectively.

NOTE 13. Earnings Per Common Share

Basic income (loss) per common share (“EPS”) is computed based on the weighted average number of common shares outstanding. Diluted income (loss) per common share is computed based on the weighted average number of common shares outstanding plus the impact of forward equity sales agreements using the treasury stock method, common shares issuable from the assumed conversion of DownREIT units, stock options, certain performance restricted stock units, OP Units, and unvested restricted stock units. Only those instruments having a dilutive impact on the Company’s basic income (loss) per share are included in diluted income (loss) per share during the periods presented.

Certain restricted stock units are considered participating securities, because dividend payments are not forfeited even if the underlying award does not vest, and require use of the two-class method when computing basic and diluted earnings per share.

The Company considers the potential dilution resulting from forward agreements under its ATM Programs to the calculation of earnings per share. At inception, the agreements do not have an effect on the computation of basic EPS as no shares are delivered until settlement. However, the Company uses the treasury stock method to calculate the dilution, if any, resulting from the forward sales agreements during the period of time prior to settlement. Refer to Note 12 for a discussion of the sale of shares under and settlement of forward sales agreements, of which there were none during the three months ended March 31, 2025 and 2024.

The following table illustrates the computation of basic and diluted earnings per share (in thousands, except per share amounts):


	Three Months Ended March 31,
	2025		2024
Numerator
Net income (loss)	$	50,064	$	11,177
Noncontrolling interests’ share in earnings	(7,236)		(4,501)
Net income (loss) attributable to Healthpeak Properties, Inc.	42,828		6,676
Less: Participating securities’ share in earnings	(464)		(199)



Net income (loss) applicable to common shares - basic and diluted	$	42,364	$	6,477




Denominator
Basic weighted average shares outstanding	699,067		600,898
Dilutive potential common shares - equity awards(1)	51		181

Dilutive potential common shares - OP Units(2)	—		109

Diluted weighted average common shares	699,118		601,188
Earnings (loss) per common share








Basic	$	0.06	$	0.01
Diluted	$	0.06	$	0.01

_______________________________________

(1)For all periods presented, represents the dilutive impact of 1 million outstanding equity awards (restricted stock units and stock options).

(2)For the three months ended March 31, 2025 and 2024, represents the dilutive impact of 5 million and 3 million outstanding OP Units, respectively.

For the three months ended March 31, 2025 and 2024, all 13 million and 14 million shares issuable upon conversion of DownREIT units, respectively, were not included because they were anti-dilutive.

NOTE 14. Segment Disclosures

The Company’s operating segments, based on how its CODM, the President and Chief Executive Officer, evaluates the business and allocates resources, are as follows: (i) outpatient medical, (ii) lab, (iii) CCRC, (iv) an interest in an unconsolidated joint venture that owns 19 senior housing assets (the “SWF SH JV”), and (v) loans receivable. The Company’s reportable segments, as determined in accordance with ASC 280, Segment Reporting, are as follows: (i) outpatient medical, (ii) lab, and (iii) CCRC. The SWF SH JV and loans receivable are non-reportable segments that have been presented on a combined basis within the Notes to the Consolidated Financial Statements herein. The accounting policies of the segments are the same as those described in Note 2 to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the SEC, as updated by Note 2 herein.

The CODM evaluates performance based on property Adjusted NOI. Adjusted NOI is used to evaluate performance because it provides relevant and useful information by reflecting only income and operating expense items that are incurred at the property level and presenting it on an unlevered basis. Adjusted NOI represents real estate revenues (inclusive of rental and related revenues, resident fees and services, and government grant income and exclusive of interest income), less property level operating expenses; Adjusted NOI excludes all other financial statement amounts included in net income (loss). Adjusted NOI eliminates the effects of straight-line rents, amortization of market lease intangibles, termination fees, actuarial reserves for insurance claims that have been incurred but not reported, and the impact of deferred community fee income and expense.

Adjusted NOI is calculated as Adjusted NOI from consolidated properties, plus the Company’s share of Adjusted NOI from unconsolidated joint ventures (calculated by applying the Company’s actual ownership percentage for the period), less noncontrolling interests’ share of Adjusted NOI from consolidated joint ventures (calculated by applying the Company’s actual ownership percentage for the period). Management utilizes its share of Adjusted NOI in assessing its performance as the Company has various joint ventures that contribute to its performance.

Segment assets consist of real estate assets, intangible assets, and right-of-use assets. Non-segment assets consist of assets in the Company’s other non-reportable segments and corporate non-segment assets. Corporate non-segment assets consist primarily of corporate assets, including cash and cash equivalents, restricted cash, accounts receivable, other assets, and real estate assets held for sale. Reportable segment asset information is not provided to the CODM as the CODM does not use segment asset information to evaluate the business and allocate resources.

The following tables summarize information for the reportable segments for the three months ended March 31, 2025 (in thousands):


	Outpatient Medical		Lab		CCRC		Total
Total revenues	$	320,548	$	217,593	$	148,927	$	687,068


Healthpeak’s share of unconsolidated joint venture total revenues	7,259		2,800		—		10,059

Noncontrolling interests’ share of consolidated joint venture total revenues	(9,973)		—		—		(9,973)
Operating expenses(1)	(105,225)		(57,658)		(110,260)		(273,143)
Healthpeak’s share of unconsolidated joint venture operating expenses	(2,994)		(1,666)		—		(4,660)
Noncontrolling interests’ share of consolidated joint venture operating expenses	2,778		—		—		2,778

Adjustments to NOI(2)	(12,082)		(14,836)		—		(26,918)
Adjusted NOI for reportable segments	$	200,311	$	146,233	$	38,667	$	385,211
Plus: Adjustments to NOI(2)							26,918
Interest income and other							15,821
Interest expense							(72,693)
Depreciation and amortization							(268,546)
General and administrative							(26,118)
Transaction and merger-related costs							(5,534)
Impairments and loan loss reserves, net							3,562


Other income (expense), net							(6,126)

Less: Healthpeak’s share of unconsolidated joint venture Adjusted NOI							(5,399)
Plus: Noncontrolling interests’ share of consolidated joint venture Adjusted NOI							7,195
Income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures							$	54,291

_______________________________________

(1)See reconciliation of significant expense categories below.

(2)Represents straight-line rents, amortization of market lease intangibles, net, actuarial reserves for insurance claims that have been incurred but not reported, deferral of community fees, and termination fees. Includes the Company’s share of income (loss) generated by unconsolidated joint ventures and excludes noncontrolling interests’ share of income (loss) generated by consolidated joint ventures.

The following table summarizes the Company’s significant expense categories by reportable segment for the three months ended March 31, 2025 (in thousands):


	Outpatient Medical		Lab		CCRC
Compensation and property management	$	14,629	$	8,310	$	70,003
Food	—		—		6,442
Real estate taxes	24,079		19,021		4,508
Repairs and maintenance	15,503		7,358		4,846
Utilities	17,912		10,423		5,663
Other segment items(1)	33,102		12,546		18,798
Operating expenses	$	105,225	$	57,658	$	110,260

_______________________________________

(1)Other segment items for each segment include:

Outpatient medical and lab – (i) Cleaning expense, (ii) ground rent expense, (iii) insurance expense, (iv) roads and grounds expense, (v) security expense, and (vi) other administrative expense.
CCRC – (i) Cleaning and supplies, (ii) insurance expense, (iii) marketing expense, and (iv) other administrative expense.

The following tables summarize information for the reportable segments for the three months ended March 31, 2024 (in thousands):


	Outpatient Medical		Lab		CCRC		Total
Total revenues	$	238,272	$	223,761	$	138,776	$	600,809


Healthpeak’s share of unconsolidated joint venture total revenues	2,739		4,861		—		7,600

Noncontrolling interests’ share of consolidated joint venture total revenues	(8,876)		(163)		—		(9,039)
Operating expenses(1)	(81,268)		(56,840)		(105,621)		(243,729)
Healthpeak’s share of unconsolidated joint venture operating expenses	(1,083)		(1,324)		—		(2,407)
Noncontrolling interests’ share of consolidated joint venture operating expenses	2,430		43		—		2,473

Adjustments to NOI(2)	(6,127)		(21,435)		—		(27,562)
Adjusted NOI for reportable segments	$	146,087	$	148,903	$	33,155	$	328,145
Plus: Adjustments to NOI(2)							27,562
Interest income and other							5,751
Interest expense							(60,907)
Depreciation and amortization							(219,219)
General and administrative							(23,299)
Transaction and merger-related costs							(107,220)
Impairments and loan loss reserves, net							(11,458)


Gain (loss) on sales of real estate, net							3,255
Other income (expense), net							78,516

Less: Healthpeak’s share of unconsolidated joint venture Adjusted NOI							(5,193)
Plus: Noncontrolling interests’ share of consolidated joint venture Adjusted NOI							6,566
Income (loss) before income taxes and equity income (loss) from unconsolidated joint ventures							$	22,499

_______________________________________

(1)See reconciliation of significant expense categories below.

The following table summarizes the Company’s significant expense categories by reportable segment for the three months ended March 31, 2024 (in thousands):


	Outpatient Medical		Lab		CCRC
Compensation and property management	$	11,097	$	8,377	$	67,622
Food	—		—		6,463
Real estate taxes	20,128		19,897		4,301
Repairs and maintenance	11,591		6,611		4,614
Utilities	12,887		11,184		5,336
Other segment items(1)	25,565		10,771		17,285
Operating expenses	$	81,268	$	56,840	$	105,621

_______________________________________

(1)Other segment items for each segment include:

Outpatient medical and lab – (i) Cleaning expense, (ii) ground rent expense, (iii) insurance expense, (iv) roads and grounds expense, (v) security expense, and (vi) other administrative expense.
CCRC – (i) Cleaning and supplies, (ii) insurance expense, (iii) marketing expense, and (iv) other administrative expense.

The following table summarizes the Company’s revenues by reportable segment (in thousands):


	Three Months Ended March 31,
Segment	2025		2024



Outpatient medical	$	320,548	$	238,272
Lab	217,593		223,761
CCRC	148,927		138,776
Total revenues for reportable segments	687,068		600,809
Interest income and other	15,821		5,751
Total revenues	$	702,889	$	606,560

NOTE 15. Supplemental Cash Flow Information

The following table provides supplemental cash flow information (in thousands):


	Three Months Ended March 31,
	2025		2024
Supplemental cash flow information:
Interest paid, net of capitalized interest	$	80,706	$	73,789
Income taxes paid (refunded)	256		871
Capitalized interest	20,035		15,232
Supplemental schedule of non-cash investing and financing activities:
Accrued construction costs	128,341		108,797
Increase in ROU asset in exchange for new lease liability related to operating leases	—		4,339





Retained investment in connection with Callan Ridge JV (see Note 8)	—		69,255
Non-cash assets and liabilities assumed in connection with the Merger (see Note 3)	—		2,927,611

The following table summarizes cash, cash equivalents, and restricted cash (in thousands):


	Three Months Ended March 31,
	2025		2024

Beginning of period:
Cash and cash equivalents	$	119,818	$	117,635
Restricted cash	64,487		51,388
Cash, cash equivalents, and restricted cash	$	184,305	$	169,023
End of period:
Cash and cash equivalents	$	70,625	$	101,763
Restricted cash	67,981		55,395
Cash, cash equivalents, and restricted cash	$	138,606	$	157,158

Cash and Cash Equivalents

The Company maintains its cash and cash equivalents at financial institutions insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per institution. As of March 31, 2025 and December 31, 2024, the account balances at certain institutions exceeded the FDIC insurance coverage.

NOTE 16. Variable Interest Entities

Operating Subsidiary

Healthpeak OP is the Company’s operating subsidiary and a limited liability company that has governing provisions that are the functional equivalent of a limited partnership. The Company holds a membership interest in Healthpeak OP, acts as the managing member of Healthpeak OP, and exercises full responsibility, discretion, and control over the day-to-day management of Healthpeak OP. Because the noncontrolling interests in Healthpeak OP do not have substantive liquidation rights, substantive kick-out rights without cause, or substantive participating rights, the Company has determined that Healthpeak OP is a VIE. The Company, as managing member, has the power to direct the core activities of Healthpeak OP that most significantly affect Healthpeak OP’s performance, and through its interest in Healthpeak OP, has both the right to receive benefits from and the obligation to absorb losses of Healthpeak OP. Accordingly, the Company is the primary beneficiary of Healthpeak OP and consolidates Healthpeak OP. As the Company conducts its business and holds its assets and liabilities through Healthpeak OP, the total consolidated assets and liabilities, income (losses), and cash flows of Healthpeak OP represent substantially all of the total consolidated assets and liabilities, including the consolidated and unconsolidated entities discussed in this Note 16, income (losses), and cash flows of the Company.

Unconsolidated Variable Interest Entities

The Company has investments in certain unconsolidated VIEs. The Company determined it is not the primary beneficiary of and therefore does not consolidate these VIEs because it does not have the ability to control the activities that most significantly impact their economic performance. Except for the Company’s equity interest in the unconsolidated joint ventures, as more fully discussed below, it has no formal involvement in these VIEs beyond its investments.

LLC Investment. The Company holds a limited partner ownership interest in an unconsolidated LLC (“LLC Investment”) that has been identified as a VIE. The Company’s involvement in the entity is limited to its equity investment as a limited partner and it does not have any substantive participating rights or kick-out rights over the general partner. The assets and liabilities of the entity primarily consist of three hospitals as well as senior housing real estate. Any assets generated by the entity may only be used to settle its contractual obligations (primarily capital expenditures and debt service payments).

PropTech Investment. During the year ended December 31, 2024, the Company made an initial investment of $1 million in a property technology (“PropTech”) fund that makes venture capital investments in early-stage real estate and construction-related companies (the “PropTech Investment”). During the three months ended March 31, 2025, the Company provided additional funding of $1 million. Therefore, as of March 31, 2025, the Company’s total investment in the PropTech Investment was $2 million. The Company has an aggregate commitment of $10 million, or approximately 5% of total fund commitments. The PropTech Investment has been identified as a VIE. The Company’s involvement in the entity is limited to its equity investment as a limited partner and it does not have any substantive participating rights or kick-out rights over the general partner and given its rights and ownership percentage, the Company has virtually no influence or control. The assets and liabilities of the entity primarily consist of investments in certain PropTech real estate and construction companies. All future investments will be funded with capital contributions from the Company and other limited partners in accordance with their respective commitments.

Needham Land Parcel JV. In December 2021, the Company acquired a 38% interest in a lab development joint venture in Needham, Massachusetts for $13 million. Current equity at risk is not sufficient to finance the joint venture’s activities. The assets and liabilities of the entity primarily consist of real estate and debt service obligations. Any assets generated by the entity may only be used to settle its contractual obligations (primarily development costs and debt service payments).

HQ Point Preferred Equity Investment. In February 2025, the Company made a preferred equity investment in a joint venture that holds a lab campus under development in San Diego, California. As of March 31, 2025, the Company has funded $21 million of its investment. Current equity at risk is not sufficient to finance the entity’s activities. The assets and liabilities of the entity primarily consist of real estate and debt service obligations. Any assets generated by the entity may only be used to settle its contractual obligations (primarily development costs and debt service payments).

Loans Receivable Investments. In March 2025, the Company entered into an agreement to provide aggregate financing of $41 million to fund the development of an outpatient medical building in Dallas, Texas. The borrower entity for these investments meets the criteria of a VIE in accordance with ASC 810, Consolidation, and the Company is not the primary beneficiary of the borrower.

The classification of the related assets and liabilities and the maximum loss exposure as a result of the Company’s involvement with these VIEs at March 31, 2025 was as follows (in thousands):


VIE Type	Asset Type	Maximum Loss Exposure and Carrying Amount(1)
LLC Investment and PropTech Investment	Other assets, net	$	16,875
Needham Land Parcel JV and HQ Point Preferred Equity Investment	Investments in and advances to unconsolidated joint ventures	42,900
Loans Receivable Investments	Loans receivable, net	3,522

_______________________________________

(1)The Company’s maximum loss exposure represents the aggregate carrying amount of such investments.

As of March 31, 2025, the Company had not provided, and is not required to provide, financial support through a liquidity arrangement or otherwise, to its unconsolidated VIEs, including under circumstances in which it could be exposed to further losses (e.g., cash shortfalls).

Consolidated Variable Interest Entities

The Company’s consolidated total assets and total liabilities at March 31, 2025 and December 31, 2024 include certain assets of VIEs that can only be used to settle the liabilities of the related VIE. The VIE creditors do not have recourse to the Company.

Ventures V, LLC. The Company holds a 51% ownership interest in and is the managing member of a joint venture entity formed in October 2015 that owns and leases outpatient medical buildings (“Ventures V”). The Company classifies Ventures V as a VIE due to the non-managing member lacking substantive participation rights in the management of Ventures V or kick-out rights over the managing member. The Company consolidates Ventures V as the primary beneficiary because it has the ability to control the activities that most significantly impact the VIE’s economic performance. The assets of Ventures V primarily consist of leased properties (net real estate), rents receivable, and cash and cash equivalents; its obligations primarily consist of capital expenditures for the properties. Assets generated by Ventures V may only be used to settle its contractual obligations.

MSREI JV. The Company holds a 51% ownership interest in, and is the managing member of, a joint venture entity formed in August 2018 that owns and leases outpatient medical buildings (the “MSREI JV”). The MSREI JV is a VIE due to the non-managing member lacking substantive participation rights in the management of the joint venture or kick-out rights over the managing member. The Company consolidates the MSREI JV as the primary beneficiary because it has the ability to control the activities that most significantly impact the VIE’s economic performance. The assets of the MSREI JV primarily consist of leased properties (net real estate), rents receivable, and cash and cash equivalents; its obligations primarily consist of capital expenditures for the properties. Assets generated by the MSREI JV may only be used to settle its contractual obligations.

DownREITs. As of March 31, 2025 and December 31, 2024, the Company held a controlling ownership interest in and was the managing member of eight DownREITs. The Company classifies the DownREITs as VIEs due to the non-managing members lacking substantive participation rights in the management of the DownREITs or kick-out rights over the managing member. The Company consolidates the DownREITs as the primary beneficiary because it has the ability to control the activities that most significantly impact these VIEs’ economic performance. The assets of the DownREITs primarily consist of leased properties (net real estate), rents receivable, and cash and cash equivalents; their obligations primarily consist of capital expenditures for the properties, debt service payments, and with respect to DOC DR OP Sub, certain guarantees. Assets generated by the DownREITs (primarily from tenant rents) may only be used to settle their contractual obligations (primarily from debt service and capital expenditures).

Other Consolidated Real Estate Partnerships. The Company holds a controlling ownership interest in and is the general partner (or managing member) of multiple partnerships that own and lease real estate assets (the “Partnerships”). The Company classifies the Partnerships as VIEs due to the limited partners (non-managing members) lacking substantive participation rights in the management of the Partnerships or kick-out rights over the general partner (managing member). The Company consolidates the Partnerships as the primary beneficiary because it has the ability to control the activities that most significantly impact these VIEs’ economic performance. The assets of the Partnerships primarily consist of leased properties (net real estate), rents receivable, and cash and cash equivalents; their obligations primarily consist of debt service payments and capital expenditures for the properties. Assets generated by the Partnerships (primarily from tenant rents) may only be used to settle their contractual obligations (primarily from debt service and capital expenditures).

Total assets and total liabilities include VIE assets and liabilities, excluding those of Healthpeak OP, as follows (in thousands):


	March 31, 2025		December 31, 2024
Assets
Buildings and improvements	$	4,745,424	$	4,669,914
Development costs and construction in progress	75,420		92,710
Land and improvements	476,244		472,232
Accumulated depreciation and amortization	(819,325)		(761,759)
Net real estate	4,477,763		4,473,097
Loans receivable, net	548,738		550,829
Investments in and advances to unconsolidated joint ventures	34,322		39,946
Accounts receivable, net	8,760		17,357
Cash and cash equivalents	30,050		32,421
Restricted cash	2,321		1,029
Intangible assets, net	586,168		629,802

Right-of-use asset, net	272,838		270,918
Other assets, net	174,678		173,435
Total assets	$	6,135,638	$	6,188,834
Liabilities
Term loans	$	401,767	$	401,895
Senior unsecured notes	1,155,895		1,151,801
Mortgage debt	245,611		247,776
Intangible liabilities, net	90,221		95,315

Lease liability	196,540		193,421
Accounts payable, accrued liabilities, and other liabilities	105,617		125,688
Deferred revenue	62,212		65,358
Total liabilities	$	2,257,863	$	2,281,254

NOTE 17. Fair Value Measurements

The table below summarizes the carrying amounts and fair values of the Company’s financial instruments either recorded or disclosed on a recurring basis (in thousands):


	March 31, 2025(3)				December 31, 2024(3)
	Carrying Value		Fair Value		Carrying Value		Fair Value
Loans receivable, net(2)	$	698,525	$	712,404	$	717,190	$	729,637

Interest rate swap assets(2)	13,514		13,514		35,120		35,120

Bank line of credit and commercial paper(2)	164,000		164,000		150,000		150,000
Term loans(2)	1,646,335		1,646,335		1,646,043		1,646,043
Senior unsecured notes(1)	6,714,279		6,592,068		6,563,256		6,373,528
Mortgage debt(2)	352,051		347,889		356,750		350,292
Interest rate swap liabilities(2)	294		294		—		—

_______________________________________

(1)Level 1: Fair value is calculated based on quoted prices in active markets.

(2)Level 2: For loans receivable, net, interest rate swap instruments, and mortgage debt, fair value is based on standardized pricing models in which significant inputs or value drivers are observable in active markets. For bank line of credit, commercial paper, and term loans, the carrying values are a reasonable estimate of fair value because the borrowings are primarily based on market interest rates and the Company’s credit rating.

(3)During the three months ended March 31, 2025 and year ended December 31, 2024, there were no material transfers of financial assets or liabilities within the fair value hierarchy.

NOTE 18. Derivative Financial Instruments

The Company uses derivative instruments to mitigate the effects of interest rate fluctuations on specific forecasted transactions as well as recognized financial obligations or assets. Utilizing derivative instruments allows the Company to manage the risk of fluctuations in interest rates and their related potential impact on future earnings and cash flows. The Company does not use derivative instruments for speculative or trading purposes. At March 31, 2025, a one percentage point increase or decrease in the underlying interest rate curve would result in a corresponding increase or decrease in the fair value of the derivative instruments by up to $50 million.

In April 2022, the Company entered into two interest rate swap instruments that are designated as cash flow hedges and mature in May 2026 on $142 million of variable rate mortgage debt secured by a portfolio of outpatient medical buildings (see Note 10). In February 2023, the Company modified these two interest rate swap instruments to reflect the change in the related variable rate mortgage debt’s interest rate benchmarks from LIBOR to SOFR (see Note 10).

In August 2022, the Company entered into two forward-starting interest rate swap instruments on the $500 million aggregate principal amount of the 2027 Term Loans (see Note 10). The interest rate swap instruments are designated as cash flow hedges.

In January 2024, the Company entered into forward-starting interest rate swap instruments on the $750 million aggregate principal amount of the 2029 Term Loan (see Note 10). The interest rate swap instruments are designated as cash flow hedges.

Additionally, on March 1, 2024, concurrently with the consummation of the Merger, the Company acquired: (i) three interest rate swap instruments on the $400 million aggregate principal amount of the 2028 Term Loan that are designated as cash flow hedges and (ii) one interest rate swap instrument on $36 million of variable rate mortgage debt that was designated as a cash flow hedge (see Note 10), prior to its maturity in October 2024.

The following table summarizes the Company’s interest rate swap instruments (in thousands):


							Fair Value(2)
Date Entered(1)	Maturity Date	Hedge Designation	Notional Amount		Pay Rate	Receive Rate	March 31, 2025		December 31, 2024

Interest rate swap assets:
April 2022	May 2026	Cash flow	$	51,100	4.99 %	USD-SOFR w/ -5 Day Lookback + 2.50%	$	765	$	1,050
April 2022	May 2026	Cash flow	91,000		4.54 %	USD-SOFR w/ -5 Day Lookback + 2.05%	1,363		1,870
August 2022	February 2027	Cash flow	250,000		2.60 %	1 mo. USD-SOFR CME Term	4,963		7,224
August 2022	August 2027	Cash flow	250,000		2.54 %	1 mo. USD-SOFR CME Term	6,261		9,122
May 2023(3)(4)	May 2028	Cash flow	400,000		3.59 %	USD-SOFR w/ -5 Day Lookback	—		4,887
January 2024(5)	February 2029	Cash flow	350,000		3.57 %	USD-SOFR w/ -5 Day Lookback	162		5,347
January 2024(6)	February 2029	Cash flow	400,000		3.60 %	USD-SOFR w/ -5 Day Lookback	—		5,620
Total interest rate swap assets							$	13,514	$	35,120
Interest rate swap liabilities:
May 2023(3)(4)	May 2028	Cash flow	400,000		3.59 %	USD-SOFR w/ -5 Day Lookback	$	(11)	$	—
January 2024(6)	February 2029	Cash flow	400,000		3.60 %	USD-SOFR w/ -5 Day Lookback	(283)		—
Total interest rate swap liabilities							$	(294)	$	—

(1)Represents interest rate swap instruments that hedge fluctuations in interest payments on variable rate debt by converting the interest rates to fixed interest rates. The changes in fair value of designated derivatives that qualify as cash flow hedges are recorded in accumulated other comprehensive income (loss) on the Consolidated Balance Sheets.

(2)Derivative assets are recorded at fair value in other assets, net and derivative liabilities are recorded at fair value in accounts payable, accrued liabilities, and other liabilities on the Consolidated Balance Sheets.

(3)Includes interest rate swap instruments acquired as part of the Merger (see Note 3). The interest rate swap instrument on $36 million of mortgage debt that was acquired as part of the Merger matured in October 2024 and has been excluded herein. These interest rate swap instruments were redesignated as cash flow hedges on the Closing Date. As a result of the Merger, the aggregate fair value of these interest rate swap instruments was determined to be $7 million on March 1, 2024, which was recognized within other assets, net on the Consolidated Balance Sheets on the Closing Date. The aggregate fair value as of the Closing Date is being amortized into interest expense on the Consolidated Statements of Operations over the terms of the related interest rate swap instruments. During the three months ended March 31, 2025 and 2024, the Company recognized $0.4 million and $0.2 million, respectively, of related amortization into interest expense.

(4)Includes two interest rate swap instruments each with notional amounts of $110 million and one interest rate swap instrument with a notional amount of $180 million.

(5)Includes the following: (i) two interest rate swap instruments each with a pay rate of 3.56% and $50 million notional amount; (ii) three interest rate swap instruments each with a pay rate of 3.57% and $50 million notional amount; and (iii) one interest rate swap instrument with a pay rate of 3.58% and $100 million notional amount.

(6)Includes the following: (i) five interest rate swap instruments each with a pay rate of 3.60% and $50 million notional amount and (ii) three interest rate swap instruments each with a pay rate of 3.61% and $50 million notional amount.

NOTE 19. Accounts Payable, Accrued Liabilities, and Other Liabilities

The following table summarizes the Company’s accounts payable, accrued liabilities, and other liabilities (in thousands):


	March 31, 2025		December 31, 2024
Refundable entrance fees	$	233,358	$	236,563
Accrued construction costs	128,341		136,767
Accrued interest	60,174		76,040
Other accounts payable and accrued liabilities(1)	248,348		275,972
Accounts payable, accrued liabilities, and other liabilities	$	670,221	$	725,342

_______________________________________

(1)As of March 31, 2025 and December 31, 2024, includes $3 million and $4 million, respectively, of severance-related obligations associated with the departure of a former CEO in October 2022 that had not yet been paid.

NOTE 20. Deferred Revenue

The following table summarizes the Company’s deferred revenue, excluding deferred revenue related to assets classified as held for sale (in thousands):


	March 31, 2025		December 31, 2024
Non-refundable entrance fees(1)	$	620,420	$	615,723
Other deferred revenue(2)	319,435		324,413
Deferred revenue	$	939,855	$	940,136

_______________________________________

(1)During each of the three months ended March 31, 2025 and 2024, the Company collected non-refundable entrance fees of $29 million. During the three months ended March 31, 2025 and 2024, the Company recognized amortization of $24 million and $22 million, respectively. The amortization of non-refundable entrance fees is included within resident fees and services on the Consolidated Statements of Operations.

(2)Other deferred revenue is primarily comprised of prepaid rent, deferred rent, and tenant-funded tenant improvements owned by the Company. During the three months ended March 31, 2025 and 2024, the Company recognized amortization related to other deferred revenue of $11 million and $15 million, respectively. The amortization of other deferred revenue is included in rental and related revenues on the Consolidated Statements of Operations.

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