Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Seniors Housing Operating

The following is a summary of our results of operations for the Seniors Housing Operating segment (in thousands):


	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
Revenues:
Resident fees and services	$	2,061,370	$	1,511,524	$	549,846	36	%	$	5,896,944	$	4,265,271	$	1,631,673	38	%

Other income	8,745		2,498		6,247		250	%	16,774		5,861		10,913		186	%
Total revenues	2,070,115		1,514,022		556,093		37	%	5,913,718		4,271,132		1,642,586		38	%
Property operating expenses	1,499,215		1,135,887		363,328		32	%	4,322,176		3,190,140		1,132,036		35	%
NOI (1)	570,900		378,135		192,765		51	%	1,591,542		1,080,992		510,550		47	%
Other expenses:
Depreciation and amortization	368,523		279,693		88,830		32	%	1,063,660		770,020		293,640		38	%
Interest expense	22,672		8,742		13,930		159	%	58,522		27,254		31,268		115	%
Loss (gain) on extinguishment of debt, net	—		—		—		n/a		6,156		1,711		4,445		260	%
Impairment of assets	3,081		20,887		(17,806)		(85)	%	36,922		65,996		(29,074)		(44)	%
Other expenses	38,673		17,795		20,878		117	%	65,797		64,276		1,521		2	%
	432,949		327,117		105,832		32	%	1,231,057		929,257		301,800		32	%

Income (loss) from continuing operations before income taxes and other items	137,951		51,018		86,933		170	%	360,485		151,735		208,750		138	%
Income (loss) from unconsolidated entities	(15,485)		3,886		(19,371)		(498)	%	(24,270)		(3,550)		(20,720)		(584)	%
Gain (loss) on real estate dispositions and acquisitions of controlling interests, net	(1,313)		63		(1,376)		n/a		50,725		141,726		(91,001)		(64)	%
Income (loss) from continuing operations	121,153		54,967		66,186		120	%	386,940		289,911		97,029		33	%
Net income (loss)	121,153		54,967		66,186		120	%	386,940		289,911		97,029		33	%
Less: Net income (loss) attributable to noncontrolling interests	(1,099)		(490)		(609)		(124)	%	(1,698)		(1,974)		276		14	%
Net income (loss) attributable to common stockholders	$	122,252	$	55,457	$	66,795	120	%	$	388,638	$	291,885	$	96,753	33	%

(1) See "Non-GAAP Financial Measures" below for additional information and reconciliations.

Resident fees and services and property operating expenses increased for the three and nine month periods ended September 30, 2025 compared to the same periods in the prior year primarily due to acquisitions, including the acquisition of Care UK as described in Note 3 to our consolidated financial statements, construction conversions and the conversions of Triple-net properties to Seniors Housing Operating RIDEA structures throughout 2024 and into early 2025. Additionally, our Seniors Housing Operating revenues are dependent on occupancy and rate growth, both of which have continued to steadily increase from the prior year. Average occupancy is as follows:


	Three Months Ended(1)
	March 31,		June 30,		September 30,		December 31,
2024	82.5	%	82.8	%	83.8	%	84.8	%
2025	85.1	%	85.6	%	86.9	%

(1) Average occupancy includes our minority ownership share related to unconsolidated properties and excludes the minority partners' noncontrolling ownership share related to consolidated properties. Also excludes land parcels and properties under development.

The following is a summary of our SSNOI at Welltower's share for the Seniors Housing Operating segment (in thousands):


	QTD Pool								YTD Pool
	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
SSNOI (1)	$	418,611	$	348,035	$	70,576	20.3	%	$	1,102,903	$	902,504	$	200,399	22.2	%

(1) For the QTD Pool and YTD Pool, amounts relate to 763 and 642 same store properties. Please see "Non-GAAP Financial Measures" below for additional information and reconciliations.

Depreciation and amortization expense fluctuates as a result of acquisitions, dispositions and segment transitions. To the extent that we acquire, develop or dispose of additional properties in the future, our provision for depreciation and amortization will change accordingly.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

During the nine months ended September 30, 2025, we recorded $36,922,000 of impairment charges related to nine properties. During the nine months ended September 30, 2024, we recorded impairment charges of $65,996,000 related to 14 properties.

Transaction costs related to asset acquisitions are capitalized as a component of the purchase price. The fluctuation in other expenses is primarily due to the timing of noncapitalizable transaction costs associated with acquisitions and operator transitions. Changes in the gain on sales of properties are related to the volume and timing of property sales and the sales prices, which are further discussed in Note 5 to our unaudited consolidated financial statements. The fluctuation in the gain on sales of properties is primarily related to the disposal of the Revera Canadian portfolio, which is further discussed in Note 5 to our unaudited consolidated financial statements.

During the nine months ended September 30, 2025, we completed construction conversions representing $742,491,000 or $478,101 per unit. The following is a summary of our consolidated Seniors Housing Operating construction projects in process, excluding expansions (dollars in thousands):


As of September 30, 2025
Expected Conversion Year(1)	Properties	Units/Beds	Anticipated Remaining Funding		Construction in Progress Balance
2025	5	946	$	10,474	$	151,549
2026	9	1,312	130,030		177,042
2027	4	701	129,319		50,871

TBD(2)	4				50,825
Total	22				$	430,287

(1) Properties expected to be converted in phases over multiple years are reflected in the last expected year.
(2) Represents projects for which a final budget or expected conversion date are not yet known.

Interest expense represents secured debt interest expense, which fluctuates based on the net effect and timing of assumptions, segment transitions, fluctuations in foreign currency rates, extinguishments and principal amortizations. The fluctuations in loss (gain) on extinguishment of debt is primarily attributable to the volume of extinguishments and terms of the related secured debt.

The following is a summary of our Seniors Housing Operating segment property secured debt principal activity (in thousands):


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2025			2024			2025			2024
Beginning balance	$	2,286,113		$	1,550,164		$	2,042,583		$	1,955,048
Debt transferred	—			27,084			—			27,084
Debt issued	—			836			—			3,708
Debt assumed	—			364,130			469,130			364,130
Debt extinguished	(2,038)			—			(250,336)			(196,939)

Debt disposed(1)	—			—			—			(164,640)
Principal payments	(14,387)			(9,597)			(40,754)			(29,580)
Effect of foreign currency	(19,236)			6,070			29,829			(20,124)
Ending balance	$	2,250,452		$	1,938,687		$	2,250,452		$	1,938,687

Ending weighted average interest	4.18		%	4.44		%	4.18		%	4.44		%

(1) Please see Note 5 for additional information.

A portion of our Seniors Housing Operating property investments are formed through partnership interests. Income (loss) from unconsolidated entities represents our share of net income or losses from partnerships where we are the noncontrolling partner. Net income attributable to noncontrolling interests represents our partners’ share of net income (loss) related to joint ventures.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Triple-net

The following is a summary of our results of operations for the Triple-net segment (in thousands):


	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
Revenues:
Rental income	$	286,353	$	227,531	$	58,822	26	%	$	812,435	$	590,426	$	222,009	38	%
Interest income	—		—		—		n/a		2,111		—		2,111		n/a
Other income	284		1,118		(834)		(75)	%	875		3,248		(2,373)		(73)	%
Total revenues	286,637		228,649		57,988		25	%	815,421		593,674		221,747		37	%
Property operating expenses	8,227		9,345		(1,118)		(12)	%	25,697		30,657		(4,960)		(16)	%
NOI(1)	278,410		219,304		59,106		27	%	789,724		563,017		226,707		40	%
Other expenses:
Depreciation and amortization	72,614		57,583		15,031		26	%	223,473		181,884		41,589		23	%
Interest expense	3,977		90		3,887		n/a		11,977		800		11,177		n/a



Impairment of assets	—		2,534		(2,534)		(100)	%	38,437		3,150		35,287		n/a
Other expenses	3,731		2,445		1,286		53	%	4,741		12,070		(7,329)		(61)	%
	80,322		62,652		17,670		28	%	278,628		197,904		80,724		41	%
Income (loss) from continuing operations before income taxes and other items	198,088		156,652		41,436		26	%	511,096		365,113		145,983		40	%
Income (loss) from unconsolidated entities	(394)		(10,822)		10,428		96	%	(1,543)		(16,137)		14,594		90	%
Gain (loss) on real estate dispositions and acquisitions of controlling interests, net	5,341		272,334		(266,993)		(98)	%	(1,703)		293,628		(295,331)		(101)	%
Income (loss) from continuing operations	203,035		418,164		(215,129)		(51)	%	507,850		642,604		(134,754)		(21)	%
Net income (loss)	203,035		418,164		(215,129)		(51)	%	507,850		642,604		(134,754)		(21)	%
Less: Net income (loss) attributable to noncontrolling interests	1,205		5,523		(4,318)		(78)	%	572		16,494		(15,922)		(97)	%
Net income attributable to common stockholders	$	201,830	$	412,641	$	(210,811)	(51)	%	$	507,278	$	626,110	$	(118,832)	(19)	%

(1) See "Non-GAAP Financial Measures" below for additional information and reconciliations.

The increase in rental income was primarily due to the write-off of straight-line receivable and unamortized lease incentive balances of $97,674,000 during the nine months ended September 30, 2024, which related to leases for which the collection of substantially all contractual lease payments was no longer deemed probable due primarily to agreements reached to convert Triple-net properties to Seniors Housing Operating RIDEA structures. Additionally, a portion of the increase in rental income can be attributed to acquisitions.

Certain of our leases contain annual rental escalators that are contingent upon changes in the Consumer Price Index and/or changes in the gross operating revenues of the tenant’s properties. These escalators are not fixed, so no straight-line rent is recorded; however, rental income is recorded based on the contractual cash rental payments due for the period. If gross operating revenues at our facilities and/or the Consumer Price Index do not increase, a portion of our revenues may not continue to increase. During the nine months ended September 30, 2025, our Triple-net portfolio had 43 leases with rental rate increases and a weighted average increase of 4.2%.

Interest income is primarily related to leases that were classified as sales-type leases.

The following is a summary of our SSNOI at Welltower's share for the Triple-net segment (in thousands):


	QTD Pool								YTD Pool
	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
SSNOI(1)	$	155,387	$	151,643	$	3,744	2.5	%	$	461,602	$	448,265	$	13,337	3.0	%

(1) For the QTD Pool and YTD Pool, amounts relate to 468 and 465 same store properties. Please see "Non-GAAP Financial Measures" below for additional information and reconciliations.

Depreciation and amortization expense fluctuates as a result of the acquisitions, dispositions and segment transitions of Triple-net properties. To the extent we acquire or dispose of additional properties in the future, our provision for depreciation and amortization will change accordingly.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

During the nine months ended September 30, 2025, we recorded an impairment charge of $38,437,000 related to six properties. During the nine months ended September 30, 2024, we recorded an impairment charge of $3,150,000 related to two properties. Transaction costs related to asset acquisitions are capitalized as a component of purchase price. The fluctuation in other expenses is primarily due to noncapitalizable transaction costs from acquisitions and segment transitions.

Changes in the gain (loss) on real estate dispositions and acquisitions of controlling interests, net were related to the volume, timing and price of related transactions. During the nine months ended September 30, 2024, the Company, which held a 25% minority interest in an existing joint venture that owned 39 properties subject to triple-net leases with two tenants, acquired the remaining beneficial interest for $205,029,000 in cash, net of cash and restricted cash acquired. We evaluated the acquisition and determined that the entity met the criteria of a variable interest entity ("VIE"). We consolidated the joint venture upon acquisition of the beneficial interests and recorded a gain on change of control of interests of $179,770,000 in gain (loss) on real estate dispositions and acquisitions of controlling interests, net on the Consolidated Statements of Comprehensive Income.

Additionally, on September 30, 2024, we reached agreement with a tenant to sell 15 properties, which were included in two master leases previously classified as operating leases. As a result of the agreement to sell the properties, the two leases were classified as sales-type leases and $92,593,000 was recognized in gain (loss) on real estate dispositions and acquisitions of controlling interests, net.

Interest expense represents secured debt interest expense and related fees. The change in secured debt interest expense is due to the net effect and timing of assumptions, segment transitions, extinguishments and principal amortizations. The following is a summary of our Triple-net secured debt principal activity for the periods presented (in thousands):


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2025			2024			2025			2024
Beginning balance	$	331,979		$	37,787		$	335,552		$	38,260
Debt transferred	—			(27,084)			—			(27,084)

Debt assumed	—			532,575			—			532,575



Principal payments	(1,809)			(76)			(5,382)			(549)

Ending balance	$	330,170		$	543,202		$	330,170		$	543,202

Ending weighted average interest	3.44		%	4.01		%	3.44		%	4.01		%

A portion of our Triple-net property investments were formed through partnerships. Income (loss) from unconsolidated entities represents our share of net income or losses from partnerships where we are the noncontrolling partner. Net income attributable to noncontrolling interests represents our partners’ share of net income relating to those partnerships where we are the controlling partner. The change in noncontrolling interest from the prior year can be attributed to our increased ownership in an existing consolidated partnership.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Outpatient Medical

The following is a summary of our results of operations for the Outpatient Medical segment for the periods presented (in thousands):


	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
Revenues:
Rental income	$	213,122	$	202,955	$	10,167	5	%	$	631,647	$	593,523	$	38,124	6	%

Other income	2,050		2,040		10		—	%	6,352		7,019		(667)		(10)	%
Total revenues	215,172		204,995		10,177		5	%	637,999		600,542		37,457		6	%
Property operating expenses	63,319		62,778		541		1	%	190,759		186,426		4,333		2	%
NOI(1)	151,853		142,217		9,636		7	%	447,240		414,116		33,124		8	%
Other expenses:
Depreciation and amortization	68,675		66,503		2,172		3	%	203,584		199,783		3,801		2	%
Interest expense	771		(573)		1,344		235	%	369		2,455		(2,086)		(85)	%



Other expenses	151		(500)		651		130	%	208		440		(232)		(53)	%
	69,597		65,430		4,167		6	%	204,161		202,678		1,483		1	%
Income (loss) from continuing operations before income taxes and other items	82,256		76,787		5,469		7	%	243,079		211,438		31,641		15	%
Income (loss) from unconsolidated entities	622		332		290		87	%	(1,263)		4,652		(5,915)		(127)	%
Gain (loss) on real estate dispositions and acquisitions of controlling interests, net	(3)		(131)		128		98	%	21,630		8,062		13,568		168	%
Income (loss) from continuing operations	82,875		76,988		5,887		8	%	263,446		224,152		39,294		18	%
Net income (loss)	82,875		76,988		5,887		8	%	263,446		224,152		39,294		18	%
Less: Net income (loss) attributable to noncontrolling interests	716		609		107		18	%	2,266		475		1,791		377	%
Net income (loss) attributable to common stockholders	$	82,159	$	76,379	$	5,780	8	%	$	261,180	$	223,677	$	37,503	17	%

(1) See "Non-GAAP Financial Measures" below for additional information and reconciliations.

Rental income has increased primarily due to acquisitions and construction conversions that occurred during 2024 and year to date in 2025. Certain of our leases contain annual rental escalators that are contingent upon changes in the Consumer Price Index. These escalators are not fixed, so no straight-line rent is recorded; however, rental income is recorded based on the contractual cash rental payments due for the period. If the Consumer Price Index does not increase, a portion of our revenues may not continue to increase. Our leases could renew above or below current rental rates, resulting in an increase or decrease in rental income. For the nine months ended September 30, 2025, our consolidated Outpatient Medical portfolio signed 317,486 square feet of new leases and 1,409,030 square feet of renewals. The weighted-average term of these leases was 7 years, with a rate of $44.12 per square foot and tenant improvement and lease commission costs of $34.06 per square foot. Substantially all of these leases contain an annual fixed or contingent escalation rent structure ranging from 2.0% to 5.0%.

The following is a summary of our SSNOI at Welltower's share for the Outpatient Medical segment (in thousands):


	QTD Pool								YTD Pool
	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
SSNOI (1)	$	27,089	$	25,998	$	1,091	4.2	%	$	72,157	$	69,227	$	2,930	4.2	%

(1) For the QTD Pool and YTD Pool, amounts relate to 108 and 106 same store properties. Please see "Non-GAAP Financial Measures" below for additional information and reconciliations.

Changes in the gain (loss) on real estate dispositions and acquisitions of controlling interests, net were related to the volume, timing and price of related transactions.

During the nine months ended September 30, 2025, we completed construction conversions representing $336,863,000 or $521 per square foot. The following is a summary of our consolidated Outpatient Medical construction projects in process, excluding expansions (dollars in thousands):

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations


As of September 30, 2025
Expected Conversion Year	Properties	Square Feet	Anticipated Remaining Funding	Construction in Progress Balance


TBD(1)	1			$	34,492


(1) Represents projects for which a final budget or expected conversion date are not yet known.

Total interest expense represents secured debt interest expense. The change in secured debt interest expense is primarily due to the net effect and timing of assumptions, extinguishments and principal amortizations. The following is a summary of our Outpatient Medical secured debt principal activity (in thousands):


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2025			2024			2025			2024
Beginning balance	$	49,870		$	212,733		$	89,088		$	229,137



Debt extinguished	—			(112,000)			(38,156)			(126,866)

Principal payments	(511)			(744)			(1,573)			(2,282)

Ending balance	$	49,359		$	99,989		$	49,359		$	99,989

Ending weighted average interest	4.49		%	4.19		%	4.49		%	4.19		%

A portion of our Outpatient Medical property investments were formed through partnerships. Income or loss from unconsolidated entities represents our share of net income or losses from partnerships where we are the noncontrolling partner. Net income attributable to noncontrolling interests represents our partners’ share of net income or loss relating to those partnerships where we are the controlling partner.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Non-segment/Corporate

The following is a summary of our results of operations for the Non-segment/Corporate activities for the periods presented (in thousands):


	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
Revenues:

Interest income	$	67,216	$	69,046	$	(1,830)	-3	%	$	189,652	$	185,163	$	4,489	2	%
Other income	46,552		38,951		7,601		20	%	100,233		89,777		10,456		12	%
Total revenues	113,768		107,997		5,771		5	%	289,885		274,940		14,945		5	%
Property operating expenses	6,287		4,691		1,596		34	%	15,517		13,688		1,829		13	%
NOI(1)	107,481		103,306		4,175		4	%	274,368		261,252		13,116		5	%
Other expenses:
Interest expense	134,632		130,791		3,841		3	%	377,303		389,283		(11,980)		(3)	%
General and administrative expenses	63,124		77,901		(14,777)		(19)	%	191,057		186,784		4,273		2	%
Loss (gain) on derivatives and financial instruments, net	31,682		(9,906)		41,588		420	%	28,063		(18,785)		46,848		249	%
Loss (gain) on extinguishment of debt, net	—		419		(419)		(100)	%	—		419		(419)		(100)	%
Provision for loan losses, net	1,088		4,193		(3,105)		(74)	%	(2,032)		10,370		(12,402)		(120)	%
Other expenses	2,144		499		1,645		330	%	4,611		6,268		(1,657)		(26)	%
	232,670		203,897		28,773		14	%	599,002		574,339		24,663		4	%
Income (loss) from continuing operations before income taxes and other items	(125,189)		(100,591)		(24,598)		(24)	%	(324,634)		(313,087)		(11,547)		(4)	%
Income tax benefit (expense)	(2,335)		4,706		(7,041)		(150)	%	2,131		(2,586)		4,717		182	%
Income (loss) from unconsolidated entities	2,647		2,566		81		3	%	8,337		8,110		227		3	%

Income (loss) from continuing operations	(124,877)		(93,319)		(31,558)		(34)	%	(314,166)		(307,563)		(6,603)		(2)	%
Net income (loss)	(124,877)		(93,319)		(31,558)		(34)	%	(314,166)		(307,563)		(6,603)		(2)	%
Less: Net income (loss) attributable to noncontrolling interests	805		1,309		(504)		(39)	%	2,526		2,400		126		5	%
Net income (loss) attributable to common stockholders	$	(125,682)	$	(94,628)	$	(31,054)	(33)	%	$	(316,692)	$	(309,963)	$	(6,729)	(2)	%

(1) See "Non-GAAP Financial Measures" below for additional information and reconciliations.

The increase in other income is related to bank interest income earned on additional short-term deposits. Property operating expenses primarily represent insurance costs related to our captive insurance company, which acts as a direct insurer of property level insurance coverage for our portfolio.

The following is a summary of our Non-segment/Corporate interest expense for the periods presented (in thousands):


	Three Months Ended				Change				Nine Months Ended				Change
	September 30,								September 30,
	2025		2024		$		%		2025		2024		$		%
Senior unsecured notes	$	129,056	$	122,059	$	6,997	6	%	$	349,694	$	368,226	$	(18,532)	(5)	%

Unsecured credit facility and commercial paper program	1,573		1,597		(24)		(2)	%	6,594		4,670		1,924		41	%
Loan expense	4,003		7,135		(3,132)		(44)	%	21,015		16,387		4,628		28	%
Totals	$	134,632	$	130,791	$	3,841	3	%	$	377,303	$	389,283	$	(11,980)	(3)	%

The change in interest expense on senior unsecured notes is due to the net effect of issuances and extinguishments, as well as the movement in foreign exchange rates and related hedge activity. Please refer to Note 11 to our unaudited consolidated financial statements for additional information. The change in interest expense on our unsecured revolving credit facility and commercial paper program is due primarily to the net effect and timing of draws, paydowns and variable interest rate changes. Please refer to Note 10 to our unaudited consolidated financial statements for additional information regarding our unsecured revolving credit facility and commercial paper program. Loan expenses represent the amortization of costs incurred in connection with senior unsecured notes issuances.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

General and administrative expenses as a percentage of consolidated revenues for the nine months ended September 30, 2025 and 2024 were 2.50% and 3.25%, respectively. During the three months ended September 30, 2024, we recognized $29,838,000 as a cumulative catch up of stock compensation expense due to the change in the probability of achievement of specific performance goals related to special non-recurring performance-based stock option and restricted stock awards granted in December 2021 and January 2022. In October 2025, the Board of Directors approved a new executive compensation program which includes new equity-based incentive awards and changes to the existing compensation programs. Please refer to Note 15 to our unaudited consolidated financial statements for additional information.

Loss (gain) on derivatives and financial instruments, net is primarily attributable to the mark-to-market of the equity warrants received as part of the HC-One Group valuation that closed in 2021 and 2023.

The fluctuation in provision for loan losses, net is related to adjustments to reserves for loan losses under the current expected credit losses accounting standard.

The provision for income taxes primarily relates to state taxes, foreign taxes and taxes based on income generated by entities that are structured as taxable REIT subsidiaries.

Other

Non-GAAP Financial Measures

We believe that net income and net income attributable to common stockholders, as defined by U.S. GAAP, are the most appropriate earnings measurements. However, we consider FFO, NOI, SSNOI, EBITDA and Adjusted EBITDA to be useful supplemental measures of our operating performance. Historical cost accounting for real estate assets in accordance with U.S. GAAP implicitly assumes that the value of real estate assets diminishes predictably over time as evidenced by the provision for depreciation. However, since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient. In response, the National Association of Real Estate Investment Trusts ("NAREIT") created funds from operations attributable to common stockholders ("FFO") as a supplemental measure of operating performance for REITs that excludes historical cost depreciation from net income. FFO, as defined by NAREIT, means NICS, computed in accordance with U.S. GAAP, excluding gains (or losses) from sales of real estate and acquisitions of controlling interests, and impairment of depreciable assets, plus depreciation and amortization, and after adjustments for unconsolidated entities and noncontrolling interests.

NOI is used to evaluate the operating performance of our properties. We define NOI as total revenues, including tenant reimbursements, less property operating expenses. Property operating expenses represent costs associated with managing, maintaining and servicing tenants for our properties. These expenses include, but are not limited to, property-related payroll and benefits, property management fees paid to managers, marketing, housekeeping, food service, maintenance, utilities, property taxes and insurance. General and administrative expenses represent general overhead costs that are unrelated to property operations and unallocable to the properties. These expenses include, but are not limited to, payroll and benefits related to corporate employees, professional services, office expenses and depreciation of corporate fixed assets. Same store NOI ("SSNOI") is used to evaluate the operating performance of our properties using a consistent population which controls for changes in the composition of our portfolio. We believe the drivers of property level NOI for both consolidated properties and unconsolidated properties are generally the same and therefore, we evaluate SSNOI based on our ownership interest in each property ("Welltower Share"). To arrive at Welltower's Share, NOI is adjusted by adding our minority ownership share related to unconsolidated properties and by subtracting the minority partners' noncontrolling ownership interests for consolidated properties. We do not control investments in unconsolidated properties and while we consider disclosures at Welltower Share to be useful, they may not accurately depict the legal and economic implications of our joint venture arrangements and should be used with caution. As used herein, same store is generally defined as those revenue-generating properties in the portfolio for the relevant year-over-year reporting periods. Acquisitions and development conversions are included in SSNOI five full quarters or seven full quarters after acquisition or being placed into service for the QTD Pool and YTD Pool, respectively. Land parcels, loans and leased properties, as well as any properties sold or classified as held for sale during the respective periods are excluded from SSNOI. Redeveloped properties (including major refurbishments of a Seniors Housing Operating property where 20% or more of units are simultaneously taken out of commission for 30 days or more or Outpatient Medical properties undergoing a change in intended use) are excluded from SSNOI until five full quarters or seven full quarters post completion of the redevelopment for the QTD Pool and YTD Pool, respectively. Properties undergoing operator transitions and/or segment transitions are also excluded from SSNOI until five full quarters or seven full quarters post completion of the transition for the QTD Pool and YTD Pool, respectively. In addition, properties significantly impacted by force majeure, acts of God, or other extraordinary adverse events are excluded from SSNOI until five full quarters or seven full quarters after the properties are placed back into service for the QTD Pool and YTD Pool, respectively. SSNOI excludes non-cash NOI and includes adjustments to present consistent ownership percentages and to translate Canadian properties and U.K. properties using a consistent exchange rate. We believe NOI and SSNOI provide investors relevant and useful information because they measure

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

the operating performance of our properties at the property level on an unleveraged basis. We use NOI and SSNOI to make decisions about resource allocations and to assess the property level performance of our portfolio.

EBITDA is defined as earnings (net income) before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA excluding unconsolidated entities and including adjustments for stock-based compensation expense, provision for loan losses, gains/losses on extinguishment of debt, gains/losses on disposition of properties and acquisitions of controlling interests, impairment of assets, gains/losses on derivatives and financial instruments, other expenses, other impairment charges and other adjustments as deemed appropriate. We believe that EBITDA and Adjusted EBITDA, along with net income, are important supplemental measures because they provide additional information to assess and evaluate the performance of our operations. We primarily use these measures to determine our interest coverage ratio, which represents EBITDA and Adjusted EBITDA divided by total interest, and our fixed charge coverage ratio, which represents EBITDA and Adjusted EBITDA divided by fixed charges. Fixed charges include total interest and secured debt principal amortization. Covenants in our unsecured senior notes and primary credit facility contain financial ratios based on a definition of EBITDA and Adjusted EBITDA that is specific to those agreements. Our leverage ratios are defined as the proportion of net debt to total capitalization and include book capitalization, undepreciated book capitalization and enterprise value. Book capitalization represents the sum of net debt (defined as total long-term debt, excluding operating lease liabilities, less cash and cash equivalents and restricted cash), total equity and redeemable noncontrolling interests. Undepreciated book capitalization represents book capitalization adjusted for accumulated depreciation and amortization. Enterprise value represents book capitalization adjusted for the fair market value of our common stock.

Our supplemental reporting measures and similarly entitled financial measures are widely used by investors, equity and debt analysts and rating agencies in the valuation, comparison, rating and investment recommendations of companies. Management uses these financial measures to facilitate internal and external comparisons to our historical operating results and in making operating decisions. Additionally, these measures are utilized by the Board of Directors to evaluate management. None of our supplemental measures represent net income or cash flow provided from operating activities as determined in accordance with U.S. GAAP and should not be considered as alternative measures of profitability or liquidity. Finally, the supplemental measures, as defined by us, may not be comparable to similarly entitled items reported by other real estate investment trusts or other companies.

The tables below reflect the reconciliation of FFO to NICS, the most directly comparable U.S. GAAP measure, for the periods presented. Noncontrolling interest and unconsolidated entity amounts represent adjustments to reflect our share of depreciation and amortization, gains/loss on real estate dispositions and acquisitions of controlling interests, and impairment of assets. Amounts are in thousands except for per share data.


	Three Months Ended
	September 30,		June 30,		March 31,		December 31,		September 30,		June 30,		March 31,
FFO Reconciliation:	2025		2025		2025		2024		2024		2024		2024
Net income (loss) attributable to common stockholders	$	280,559	$	301,888	$	257,957	$	119,971	$	449,849	$	254,714	$	127,146
Depreciation and amortization	509,812		495,036		485,869		480,406		403,779		382,045		365,863
Impairment of assets	3,081		19,876		52,402		23,647		23,421		2,394		43,331
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net	(4,025)		(14,850)		(51,777)		(8,195)		(272,266)		(166,443)		(4,707)
Noncontrolling interests	(9,360)		(6,256)		(9,468)		(6,667)		(5,801)		(6,348)		(11,996)
Unconsolidated entities	44,308		30,023		30,214		27,978		36,835		27,411		37,066
FFO	$	824,375	$	825,717	$	765,197	$	637,140	$	635,817	$	493,773	$	556,703

Average diluted shares outstanding	685,399		668,140		653,795		634,259		618,306		604,563		577,530

Per diluted share data:
Net income attributable to common stockholders(1)	$	0.41	$	0.45	$	0.40	$	0.19	$	0.73	$	0.42	$	0.22
FFO	$	1.20	$	1.24	$	1.17	$	1.00	$	1.03	$	0.82	$	0.96

(1) Includes adjustment to the numerator for income (loss) attributable to OP Unitholders.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations


	Nine Months Ended
	September 30,
FFO Reconciliations:	2025		2024
Net income (loss) attributable to common stockholders	$	840,404	$	831,709
Depreciation and amortization	1,490,717		1,151,687
Impairment of assets	75,359		69,146
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net	(70,652)		(443,416)
Noncontrolling interests	(25,084)		(24,145)
Unconsolidated entities	104,545		101,312
FFO	$	2,415,289	$	1,686,293

Average diluted common shares outstanding:	669,218		600,191

Per diluted share data:
Net income attributable to common stockholders(1)	$	1.26	$	1.39
FFO	$	3.61	$	2.81

(1) Includes adjustment to the numerator for income (loss) attributable to OP unitholders.

The tables below reflect the reconciliation of consolidated NOI to net income, the most directly comparable U.S. GAAP measure, for the periods presented (dollars in thousands):


	Three Months Ended
	September 30,		June 30,		March 31,		December 31,		September 30,		June 30,		March 31,
NOI Reconciliations:	2025		2025		2025		2024		2024		2024		2024
Net income (loss)	$	282,186	$	304,618	$	257,266	$	123,753	$	456,800	$	260,670	$	131,634
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net	(4,025)		(14,850)		(51,777)		(8,195)		(272,266)		(166,443)		(4,707)
Loss (income) from unconsolidated entities	12,610		7,392		(1,263)		(6,429)		4,038		(4,896)		7,783
Income tax expense (benefit)	2,335		1,053		(5,519)		114		(4,706)		1,101		6,191
Other expenses	44,699		16,598		14,060		34,405		20,239		48,684		14,131
Impairment of assets	3,081		19,876		52,402		23,647		23,421		2,394		43,331
Provision for loan losses, net	1,088		(1,113)		(2,007)		(245)		4,193		5,163		1,014
Loss (gain) on extinguishment of debt, net	—		—		6,156		—		419		1,705		6
Loss (gain) on derivatives and financial instruments, net	31,682		(409)		(3,210)		(9,102)		(9,906)		(5,825)		(3,054)
General and administrative expenses	63,124		64,175		63,758		48,707		77,901		55,565		53,318
Depreciation and amortization	509,812		495,036		485,869		480,406		403,779		382,045		365,863
Interest expense	162,052		141,157		144,962		154,469		139,050		133,424		147,318
Consolidated net operating income (NOI)	$	1,108,644	$	1,033,533	$	960,697	$	841,530	$	842,962	$	713,587	$	762,828

NOI by segment:
Seniors Housing Operating	$	570,900	$	537,455	$	483,187	$	430,689	$	378,135	$	360,467	$	342,390
Triple-net	278,410		265,102		246,212		185,032		219,304		131,587		212,126
Outpatient Medical	151,853		148,977		146,410		142,361		142,217		136,052		135,847
Non-segment/Corporate	107,481		81,999		84,888		83,448		103,306		85,481		72,465
Total NOI	$	1,108,644	$	1,033,533	$	960,697	$	841,530	$	842,962	$	713,587	$	762,828

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations


	Nine Months Ended
	September 30,
NOI Reconciliations:	2025		2024
Net income (loss)	$	844,070	$	849,104
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net	(70,652)		(443,416)
Loss (income) from unconsolidated entities	18,739		6,925
Income tax expense (benefit)	(2,131)		2,586
Other expenses	75,357		83,054
Impairment of assets	75,359		69,146
Provision for loan losses, net	(2,032)		10,370
Loss (gain) on extinguishment of debt, net	6,156		2,130
Loss (gain) on derivatives and financial instruments, net	28,063		(18,785)
General and administrative expenses	191,057		186,784
Depreciation and amortization	1,490,717		1,151,687
Interest expense	448,171		419,792
Consolidated net operating income (NOI)	$	3,102,874	$	2,319,377

NOI by segment:
Seniors Housing Operating	$	1,591,542	$	1,080,992
Triple-net	789,724		563,017
Outpatient Medical	447,240		414,116
Non-segment/corporate	274,368		261,252
Total NOI	$	3,102,874	$	2,319,377

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following is a reconciliation of the properties included in our QTD Pool and YTD Pool for SSNOI:


	QTD Pool				YTD Pool
SSNOI Property Reconciliations:	Seniors Housing Operating	Triple-net	Outpatient Medical	Total	Seniors Housing Operating	Triple-net	Outpatient Medical	Total
Consolidated properties	1,244	667	370	2,281	1,244	667	370	2,281
Unconsolidated properties	90	—	76	166	90	—	76	166
Total properties	1,334	667	446	2,447	1,334	667	446	2,447
Recent acquisitions/development conversions(1)	(208)	(143)	(8)	(359)	(329)	(146)	(10)	(485)
Under development	(20)	—	—	(20)	(20)	—	—	(20)
Under redevelopment(2)	(1)	(1)	—	(2)	(1)	(1)	—	(2)
Current held for sale	(8)	(7)	(322)	(337)	(8)	(7)	(322)	(337)
Land parcels, loans and leased properties	(108)	(4)	(8)	(120)	(108)	(4)	(8)	(120)
Transitions(3)	(221)	(42)	—	(263)	(221)	(42)	—	(263)
Other(4)	(5)	(2)	—	(7)	(5)	(2)	—	(7)
Same store properties	763	468	108	1,339	642	465	106	1,213

(1) Acquisitions and development conversions will enter the QTD Pool after five full quarters and YTD Pool after seven full quarters from acquisition or certificate of occupancy.
(2) Redevelopment properties will enter the QTD Pool after five full quarters and YTD Pool after seven full quarters of operations post redevelopment completion.
(3) Transitioned properties will enter the QTD Pool after five full quarters and YTD Pool after seven full quarters of operations with the new operator in place or under the new structure.
(4) Represents properties that are either closed or being closed.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following is a reconciliation of our consolidated NOI to same store NOI for the periods presented for the QTD Pool and YTD Pool (dollars in thousands):


	QTD Pool				YTD Pool
	Three Months Ended				Nine Months Ended
	September 30,				September 30,
SSNOI Reconciliations:	2025		2024		2025		2024

Seniors Housing Operating:
Consolidated NOI	$	570,900	$	378,135	$	1,591,542	$	1,080,992
NOI attributable to unconsolidated investments	21,553		22,709		60,480		67,530
NOI attributable to noncontrolling interests	(12,894)		(11,262)		(38,705)		(41,066)
NOI attributable to non-same store properties	(153,386)		(36,623)		(494,939)		(195,772)
Non-cash NOI attributable to same store properties	(1,994)		(2,281)		(5,978)		(7,293)
Currency and ownership adjustments(1)	(5,568)		(2,643)		(9,497)		(1,887)
SSNOI at Welltower Share	418,611		348,035		1,102,903		902,504

Triple-net:
Consolidated NOI	278,410		219,304		$	789,724	563,017
NOI attributable to unconsolidated investments	—		1,298		—		3,646
NOI attributable to noncontrolling interests	(2,546)		(8,170)		(9,953)		(24,213)
NOI attributable to non-same store properties	(99,728)		(44,699)		(259,108)		(45,129)
Non-cash NOI attributable to same store properties	(19,486)		(20,199)		(59,631)		(62,464)
Currency and ownership adjustments(1)	(1,263)		4,109		570		13,408
SSNOI at Welltower Share	155,387		151,643		461,602		448,265

Outpatient Medical:
Consolidated NOI	151,853		142,217		447,240		414,116
NOI attributable to unconsolidated investments	4,228		4,120		12,432		13,144
NOI attributable to noncontrolling interests	(2,694)		(2,382)		(7,875)		(7,406)
NOI attributable to non-same store properties	(123,808)		(112,521)		(373,919)		(342,667)
Non-cash NOI attributable to same store properties	(2,490)		(5,347)		(5,723)		(7,893)
Currency and ownership adjustments(1)	—		(89)		2		(67)
SSNOI at Welltower Share	27,089		25,998		72,157		69,227

SSNOI at Welltower Share:
Seniors Housing Operating	418,611		348,035		1,102,903		902,504
Triple-net	155,387		151,643		461,602		448,265
Outpatient Medical	27,089		25,998		72,157		69,227
Total	$	601,087	$	525,676	$	1,636,662	$	1,419,996

(1) Includes adjustments to reflect consistent property ownership percentages, to translate Canadian properties at a USD/CAD rate of 1.43 and to translate U.K. properties at a GBP/USD rate of 1.23.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The tables below reflect the reconciliation of EBITDA to net income, the most directly comparable U.S. GAAP measure, for the periods presented (dollars in thousands):


	Three Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,			June 30,			March 31,
EBITDA Reconciliations:	2025			2025			2025			2024			2024			2024			2024
Net income (loss)	$	282,186		$	304,618		$	257,266		$	123,753		$	456,800		$	260,670		$	131,634
Interest expense	162,052			141,157			144,962			154,469			139,050			133,424			147,318
Income tax expense (benefit)	2,335			1,053			(5,519)			114			(4,706)			1,101			6,191
Depreciation and amortization	509,812			495,036			485,869			480,406			403,779			382,045			365,863
EBITDA	$	956,385		$	941,864		$	882,578		$	758,742		$	994,923		$	777,240		$	651,006

Interest Coverage Ratio:
Interest expense	$	162,052		$	141,157		$	144,962		$	154,469		$	139,050		$	133,424		$	147,318
Capitalized interest	6,150			8,653			11,520			14,160			15,668			14,478			13,809
Non-cash interest expense	(14,227)			(10,231)			(12,625)			(15,143)			(9,008)			(8,953)			(9,284)
Total interest	153,975			139,579			143,857			153,486			145,710			138,949			151,843
EBITDA	$	956,385		$	941,864		$	882,578		$	758,742		$	994,923		$	777,240		$	651,006
Interest coverage ratio	6.21		x	6.75		x	6.14		x	4.94		x	6.83		x	5.59		x	4.29		x

Fixed Charge Coverage Ratio:
Total interest	$	153,975		$	139,579		$	143,857		$	153,486		$	145,710		$	138,949		$	151,843
Secured debt principal payments	16,707			16,558			14,444			14,918			10,417			10,107			11,887
Total fixed charges	170,682			156,137			158,301			168,404			156,127			149,056			163,730
EBITDA	$	956,385		$	941,864		$	882,578		$	758,742		$	994,923		$	777,240		$	651,006
Fixed charge coverage ratio	5.60		x	6.03		x	5.58		x	4.51		x	6.37		x	5.21		x	3.98		x


	Nine Months Ended
	September 30,
EBITDA Reconciliations:	2025			2024
Net income (loss)	$	844,070		$	849,104
Interest expense	448,171			419,792
Income tax expense (benefit)	(2,131)			2,586
Depreciation and amortization	1,490,717			1,151,687
EBITDA	$	2,780,827		$	2,423,169

Interest Coverage Ratio:
Interest expense	$	448,171		$	419,792
Non-cash interest expense	(37,083)			(27,245)
Capitalized interest	26,323			43,955
Total interest	437,411			436,502
EBITDA	$	2,780,827		$	2,423,169
Interest coverage ratio	6.36		x	5.55		x

Fixed Charge Coverage Ratio:
Total interest	$	437,411		$	436,502
Secured debt principal payments	47,709			32,411
Total fixed charges	485,120			468,913
EBITDA	$	2,780,827		$	2,423,169
Fixed charge coverage ratio	5.73		x	5.17		x

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The table below reflects the reconciliation of Adjusted EBITDA to net income, the most directly comparable U.S. GAAP measure, for the periods presented (dollars in thousands):


	Twelve Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,			June 30,			March 31,
Adjusted EBITDA Reconciliations:	2025			2025			2025			2024			2024			2024			2024
Net income (loss)	$	967,823		$	1,142,437		$	1,098,489		$	972,857		$	937,544		$	615,466		$	461,138
Interest expense	602,640			579,638			571,905			574,261			574,366			591,848			610,761
Income tax expense (benefit)	(2,017)			(9,058)			(9,010)			2,700			(2,182)			7,108			9,510
Depreciation and amortization	1,971,123			1,865,090			1,752,099			1,632,093			1,532,417			1,467,952			1,427,852
EBITDA	3,539,569			3,578,107			3,413,483			3,181,911			3,042,145			2,682,374			2,509,261
Loss (income) from unconsolidated entities	12,310			3,738			(8,550)			496			8,933			8,926			54,154
Stock-based compensation expense	61,467			85,827			80,645			74,482			69,542			38,364			38,829
Loss (gain) on extinguishment of debt, net	6,156			6,575			8,280			2,130			2,130			1,712			8
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net	(78,847)			(347,088)			(498,681)			(451,611)			(441,633)			(240,469)			(71,858)
Impairment of assets	99,006			119,346			101,864			92,793			84,140			68,107			66,799
Provision for loan losses, net	(2,277)			828			7,104			10,125			12,887			12,753			10,046
Loss (gain) on derivatives and financial instruments, net	18,961			(22,627)			(28,043)			(27,887)			(26,000)			(13,209)			(6,104)
Other expenses	109,762			85,302			117,388			117,459			119,361			137,342			99,727
Lease termination and leasehold interest adjustment (1)	—			—			—			—			—			—			(65,485)
Casualty losses, net of recoveries	13,178			14,488			13,945			12,261			8,373			6,163			7,778
Other impairment (2)	42,582			42,582			130,296			139,652			102,007			114,316			25,998
Adjusted EBITDA	$	3,821,867		$	3,567,078		$	3,337,731		$	3,151,811		$	2,981,885		$	2,816,379		$	2,669,153

Adjusted Interest Coverage Ratio:
Interest expense	$	602,640		$	579,638		$	571,905		$	574,261		$	574,366		$	591,848		$	610,761
Capitalized interest	40,483			50,001			55,826			58,115			58,502			56,781			54,173
Non-cash interest expense	(52,226)			(47,007)			(45,729)			(42,388)			(33,116)			(30,824)			(27,695)
Total interest	590,897			582,632			582,002			589,988			599,752			617,805			637,239
Adjusted EBITDA	$	3,821,867		$	3,567,078		$	3,337,731		$	3,151,811		$	2,981,885		$	2,816,379		$	2,669,153
Adjusted interest coverage ratio	6.47		x	6.12		x	5.73		x	5.34		x	4.97		x	4.56		x	4.19		x

Adjusted Fixed Charge Coverage Ratio:
Total interest	$	590,897		$	582,632		$	582,002		$	589,988		$	599,752		$	617,805		$	637,239
Secured debt principal payments	62,627			56,337			49,886			47,329			44,841			47,289			51,021
Total fixed charges	653,524			638,969			631,888			637,317			644,593			665,094			688,260
Adjusted EBITDA	$	3,821,867		$	3,567,078		$	3,337,731		$	3,151,811		$	2,981,885		$	2,816,379		$	2,669,153
Adjusted fixed charge coverage ratio	5.85		x	5.58		x	5.28		x	4.95		x	4.63		x	4.23		x	3.88		x

(1) Primarily relates to the derecognition of leasehold interests and the gain recognized in other income.
(2) Represents the write-off of straight-line rent receivable and unamortized lease incentive balances relating to leases placed on cash recognition.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Our leverage ratios include book capitalization, undepreciated book capitalization and enterprise value. Book capitalization represents the sum of net debt (defined as total long-term debt excluding operating lease liabilities less cash and cash equivalents and restricted cash), total equity and redeemable noncontrolling interests. Undepreciated book capitalization represents book capitalization adjusted for accumulated depreciation and amortization. Enterprise value represents book capitalization adjusted for the fair market value of our common stock. Our leverage ratios are defined as the proportion of net debt to total capitalization.

The table below reflects the reconciliation of our leverage ratios to our balance sheets for the periods presented. Amounts are in thousands, except share price.


	As of
	September 30,		June 30,		March 31,		December 31,		September 30,		June 30,		March 31,
	2025		2025		2025		2024		2024		2024		2024
Book capitalization:
Unsecured credit facility and commercial paper	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Long-term debt obligations(1)	16,960,008		16,079,566		15,831,799		15,608,294		15,854,937		14,027,128		14,285,686
Cash and cash equivalents and restricted cash	(6,940,573)		(4,523,511)		(3,610,285)		(3,711,457)		(3,784,408)		(2,863,598)		(2,478,335)
Total net debt	10,019,435		11,556,055		12,221,514		11,896,837		12,070,529		11,163,530		11,807,351
Total equity and noncontrolling interests(2)	39,312,382		36,546,301		34,581,977		32,572,586		31,064,003		29,688,579		28,547,908
Book capitalization	$	49,331,817	$	48,102,356	$	46,803,491	$	44,469,423	$	43,134,532	$	40,852,109	$	40,355,259
Net debt to book capitalization ratio	20%		24%		26%		27%		28%		27%		29%

Undepreciated book capitalization:
Total net debt	$	10,019,435	$	11,556,055	$	12,221,514	$	11,896,837	$	12,070,529	$	11,163,530	$	11,807,351
Accumulated depreciation and amortization	10,107,309		11,673,306		11,092,885		10,626,263		10,276,509		9,908,007		9,537,562
Total equity and noncontrolling interests(2)	39,312,382		36,546,301		34,581,977		32,572,586		31,064,003		29,688,579		28,547,908
Undepreciated book capitalization	$	59,439,126	$	59,775,662	$	57,896,376	$	55,095,686	$	53,411,041	$	50,760,116	$	49,892,821
Net debt to undepreciated book capitalization ratio	17%		19%		21%		22%		23%		22%		24%

Enterprise value:
Common shares outstanding	684,108		665,120		651,889		635,289		618,396		608,151		590,934
Period end share price	$	178.14	$	153.73	$	153.21	$	126.03	$	128.03	$	104.25	$	93.44
Common equity market capitalization	$	121,866,999	$	102,248,898	$	99,875,914	$	80,065,473	$	79,173,240	$	63,399,742	$	55,216,873
Total net debt	10,019,435		11,556,055		12,221,514		11,896,837		12,070,529		11,163,530		11,807,351
Noncontrolling interests(2)	555,564		645,775		625,218		616,378		729,722		712,153		999,965
Consolidated enterprise value	$	132,441,998	$	114,450,728	$	112,722,646	$	92,578,688	$	91,973,491	$	75,275,425	$	68,024,189
Net debt to consolidated enterprise value ratio	8%		10%		11%		13%		13%		15%		17%

(1) Amounts include senior unsecured notes, secured debt and lease liabilities related to financing leases, as reflected on our Consolidated Balance Sheets. Operating lease liabilities related to ASC 842 are excluded.
(2) Includes amounts attributable to both redeemable noncontrolling interests and noncontrolling interests as reflected on our Consolidated Balance Sheets.

Critical Accounting Policies and Estimates

Our unaudited consolidated financial statements are prepared in accordance with U.S. GAAP, which requires us to make estimates and assumptions. Management considers an accounting estimate or assumption critical if:

the nature of the estimates or assumptions is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change; and
the impact of the estimates and assumptions on financial condition or operating performance is material.

Management has discussed the development and selection of its critical accounting policies and estimates with the Audit Committee of the Board of Directors. Management believes the current assumptions and other considerations used to estimate amounts reflected in our unaudited consolidated financial statements are appropriate and are not reasonably likely to change in the future. However, since these estimates require assumptions to be made that were uncertain at the time the estimate was

WELLTOWER INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

made, they bear the risk of change. If actual experience differs from the assumptions and other considerations used in estimating amounts reflected in our unaudited consolidated financial statements, the resulting changes could have a material adverse effect on our consolidated results of operations, liquidity and/or financial condition. Please refer to Note 2 to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 for further information on significant accounting policies that impact us. There have been no material changes to these policies to date in 2025.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q may contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. When Welltower uses words such as "may," "will," "intend," "should," "believe," "expect," "anticipate," "project," "pro forma," "estimate" or similar expressions that do not relate solely to historical matters, Welltower is making forward-looking statements. These statements include, among other things, the Company's statements regarding its business strategy, expectations regarding new investments and investment dispositions, key underlying trends in its business and plans regarding future financing and availability of capital. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause Welltower's actual results to differ materially from Welltower's expectations discussed in the forward-looking statements. This may be a result of various factors, including, but not limited to: the status of the economy; the status of capital markets, including availability and cost of capital; issues facing the healthcare industry, including compliance with, and changes to, regulations and payment policies, responding to government investigations and punitive settlements and operators'/tenants' difficulty in cost effectively obtaining and maintaining adequate liability and other insurance; changes in financing terms; competition within the healthcare and seniors housing industries; negative developments in the operating results or financial condition of operators/tenants, including, but not limited to, their ability to pay rent and repay loans; Welltower's ability to transition or sell properties with profitable results; the failure to make new investments or acquisitions as and when anticipated; natural disasters, health emergencies (such as the COVID-19 pandemic) and other acts of God affecting Welltower's properties; Welltower's ability to re-lease space at similar rates as vacancies occur; Welltower's ability to timely reinvest sale proceeds at similar rates to assets sold; operator/tenant or joint venture partner bankruptcies or insolvencies; the cooperation of joint venture partners; government regulations affecting Medicare and Medicaid reimbursement rates and operational requirements; liability or contract claims by or against operators/tenants; unanticipated difficulties and/or expenditures relating to future investments or acquisitions; environmental laws affecting Welltower's properties; changes in rules or practices governing Welltower's financial reporting; the movement of U.S. and foreign currency exchange rates; Welltower's ability to maintain its qualification as a REIT; key management personnel recruitment and retention; and other risks described in Welltower’s reports filed from time to time with the SEC. Other important factors are identified in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, including factors identified under the headings "Business," "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations." Finally, Welltower undertakes no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events or otherwise, or to update the reasons why actual results could differ from those projected in any forward-looking statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to various market risks, including the potential loss arising from adverse changes in interest rates and foreign currency exchange rates. We seek to mitigate the underlying foreign currency exposures with gains and losses on derivative contracts hedging these exposures. We seek to mitigate the effects of fluctuations in interest rates by matching the terms of new investments with new long-term fixed rate borrowings to the extent possible. We may or may not elect to use financial derivative instruments to hedge interest rate exposure. These decisions are principally based on our policy to match our variable rate investments with comparable borrowings, but are also based on the general trend in interest rates at the applicable dates and our perception of the future volatility of interest rates. This section is presented to provide a discussion of the risks associated with potential fluctuations in interest rates and foreign currency exchange rates. For more information, see Notes 12 and 17 to our consolidated financial statements.

We historically borrow on our unsecured revolving credit facility and commercial paper program to acquire, construct or make loans relating to healthcare and seniors housing properties. Then, as market conditions dictate, we will issue equity or long-term fixed rate debt to repay the borrowings under our unsecured revolving credit facility and commercial paper program. We are subject to risks associated with debt financing, including the risk that existing indebtedness may not be refinanced or that the terms of refinancing may not be as favorable as the terms of current indebtedness. The majority of our borrowings were completed under indentures or contractual agreements that limit the amount of indebtedness we may incur. Accordingly, in the event that we are unable to raise additional equity or borrow money because of these limitations, our ability to acquire additional properties may be limited.

A change in interest rates will not affect the interest expense associated with our fixed rate debt. Interest rate changes, however, will affect the fair value of our fixed rate debt. Changes in the interest rate environment upon maturity of this fixed rate debt could have an effect on our future cash flows and earnings, depending on whether the debt is replaced with other fixed rate debt, variable rate debt or equity or repaid by the sale of assets. To illustrate the impact of changes in the interest rate markets, we performed a sensitivity analysis on our fixed rate debt instruments after considering the effects of interest rate swaps, whereby we modeled the change in net present values arising from a hypothetical 1% increase in interest rates to determine the instruments' change in fair value. The following table summarizes the analysis performed as of the dates indicated (in thousands):

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