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
						March 31,
						2026						2025						$						%
Revenues:
Interest income						$	62,852					$	60,379					$	2,473					4		%
Other income						35,456						28,791						6,665						23		%
Total revenues						98,308						89,170						9,138						10		%
Property operating expenses						14,420						4,282						10,138						237		%
NOI(1)						83,888						84,888						(1,000)						(1)		%
Other expenses:
Interest expense						157,992						125,264						32,728						26		%
General and administrative expenses						67,474						63,758						3,716						6		%
Loss (gain) on derivatives and financial instruments, net						—						(3,210)						3,210						100		%
Loss (gain) on extinguishment of debt, net						540						—						540						n/a
Provision for loan losses, net						1,632						(2,007)						3,639						181		%
Other expenses						4,759						1,258						3,501						278		%
						232,397						185,063						47,334						26		%
Income (loss) from continuing operations before income taxes and other items						(148,509)						(100,175)						(48,334)						(48)		%
Income tax benefit (expense)						(11,633)						5,519						(17,152)						(311)		%
Income (loss) from unconsolidated entities						8,903						3,365						5,538						165		%
Income (loss) from continuing operations						(151,239)						(91,291)						(59,948)						(66)		%
Net income (loss)						(151,239)						(91,291)						(59,948)						(66)		%
Less: Net income (loss) attributable to noncontrolling interests						12,933						812						12,121						n/a
Net income (loss) attributable to common stockholders						$	(164,172)					$	(92,103)					$	(72,069)					(78)		%
(1) See “Non-GAAP Financial Measures” below for additional information and reconciliations.

Other income is primarily related to bank interest income earned on 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
						March 31,
						2026						2025						$						%
Senior unsecured notes						$	151,911					$	116,424					$	35,487					30		%
Unsecured credit facility and commercial paper program						1,624						1,578						46						3		%
Loan expense						4,457						7,262						(2,805)						(39)		%
Totals						$	157,992					$	125,264					$	32,728					26		%

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.

General and administrative expenses as a percentage of consolidated revenues for the three months ended March 31, 2026 and 2025 were 2.01% and 2.63%, respectively.

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. These warrants were settled in conjunction with

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

the HC-One Group acquisition in October 2025. Please refer to Notes 3 and 12 for additional information related to the acquisition and related warrants.

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 foreign taxes, state taxes and taxes based on income generated by entities that are structured as taxable REIT subsidiaries. The increase in expense over the prior year is primarily related to the increase in income earned in the U.K. as a result of U.K. acquisitions in 2025.

The fluctuation for net income (loss) attributable to noncontrolling interests will change based on the activity that occurs at Welltower OP and the current ownership of Welltower Inc. in Welltower OP.

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 after acquisition or being placed into service for the QTD Pool. 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 post completion of the redevelopment for the QTD Pool. Properties undergoing operator transitions and/or segment transitions are also excluded from SSNOI until five full quarters post completion of the transition for the QTD Pool. In addition, properties significantly impacted by force majeure, acts of God, or other extraordinary adverse events are excluded from SSNOI until five full quarters after the properties are placed back into service for the QTD Pool. 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 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

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

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, the Board of Directors utilizes these measures to evaluate management performance. 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 table below reflects 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
																		March 31,						December 31,						September 30,						June 30,						March 31,
FFO Reconciliation:																		2026						2025						2025						2025						2025
Net income (loss) attributable to common stockholders																		$	728,672					$	96,441					$	280,559					$	301,888					$	257,957
Depreciation and amortization																		622,752						594,151						509,812						495,036						485,869
Impairment of assets																		4,826						45,924						3,081						19,876						52,402
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net																		(420,400)						(1,378,391)						(4,025)						(14,850)						(51,777)
Noncontrolling interests																		17,100						11,940						(9,360)						(6,256)						(9,468)
Unconsolidated entities																		29,598						32,598						44,308						30,023						30,214
FFO																		$	982,548					$	(597,337)					$	824,375					$	825,717					$	765,197
Average diluted shares outstanding
For net income attributable to common stockholders																		726,255						710,167						685,399						668,140						653,795
For FFO																		726,255						689,582						685,399						668,140						653,795
Per diluted share data:
Net income attributable to common stockholders(1)																		$	1.02					$	0.14					$	0.41					$	0.45					$	0.40
FFO																		$	1.35					$	(0.87)					$	1.20					$	1.24					$	1.17
(1) Includes adjustment to the numerator for income (loss) attributable to OP Unitholders.

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

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

																		Three Months Ended
																		March 31,						December 31,						September 30,						June 30,						March 31,
NOI Reconciliations:																		2026						2025						2025						2025						2025
Net income (loss)																		$	752,324					$	117,767					$	282,186					$	304,618					$	257,266
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net																		(420,400)						(1,378,391)						(4,025)						(14,850)						(51,777)
Loss (income) from unconsolidated entities																		1,686						(4,442)						12,610						7,392						(1,263)
Income tax expense (benefit)																		11,633						(4,985)						2,335						1,053						(5,519)
Other expenses																		61,137						125,844						44,699						16,598						14,060
Impairment of assets																		4,826						45,924						3,081						19,876						52,402
Provision for loan losses, net																		1,632						(7,384)						1,088						(1,113)						(2,007)
Loss (gain) on extinguishment of debt, net																		727						3,089						—						—						6,156
Loss (gain) on derivatives and financial instruments, net																		—						(5,656)						31,682						(409)						(3,210)
General and administrative expenses																		67,474						1,557,378						63,124						64,175						63,758
Depreciation and amortization																		622,752						594,151						509,812						495,036						485,869
Interest expense																		192,715						203,784						162,052						141,157						144,962
Consolidated net operating income (NOI)																		$	1,296,506					$	1,247,079					$	1,108,644					$	1,033,533					$	960,697
NOI by segment:
Seniors Housing Operating																		$	775,013					$	697,933					$	570,900					$	537,455					$	483,187
Triple-net																		384,306						374,089						278,410						265,102						246,212
Outpatient Medical																		53,299						101,459						151,853						148,977						146,410
Non-segment/Corporate																		83,888						73,598						107,481						81,999						84,888
Total NOI																		$	1,296,506					$	1,247,079					$	1,108,644					$	1,033,533					$	960,697

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 for SSNOI:

						QTD Pool
SSNOI Property Reconciliations:						Seniors Housing Operating						Triple-net						Outpatient Medical						Total
Consolidated properties						1,810						780						68						2,658
Unconsolidated properties						107						—						73						180
Total properties						1,917						780						141						2,838
Recent acquisitions/development conversions(1)						(591)						(315)						(7)						(913)
Under development						(40)						—						—						(40)
Under redevelopment(2)						(2)						—						—						(2)
Current held for sale						(16)						(2)						(42)						(60)
Land parcels, loans and leased properties						(176)						(10)						(6)						(192)
Transitions(3)						(163)						(3)						—						(166)
Other(4)						(8)						(2)						—						(10)
Same store properties						921						448						86						1,455
(1) Acquisitions and development conversions will enter the QTD Pool after five full quarters from acquisition or certificate of occupancy.
(2) Redevelopment properties will enter the QTD Pool after five full quarters of operations post redevelopment completion.
(3) Transitioned properties will enter the QTD Pool after five 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.

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

						QTD Pool
						Three Months Ended
						March 31,
SSNOI Reconciliations:						2026						2025
Seniors Housing Operating:
Consolidated NOI						$	775,013					$	483,187
NOI attributable to unconsolidated investments						20,005						20,546
NOI attributable to noncontrolling interests						(14,098)						(13,085)
NOI attributable to non-same store properties						(248,830)						(57,288)
Non-cash NOI attributable to same store properties						(1,479)						(4,423)
Currency and ownership adjustments(1)						(1,500)						6,273
SSNOI at Welltower Share						529,111						435,210
Triple-net:
Consolidated NOI						384,306						246,212
NOI attributable to noncontrolling interests						(1,036)						(3,717)
NOI attributable to non-same store properties						(189,922)						(57,175)
Non-cash NOI attributable to same store properties						(22,304)						(27,241)
Currency and ownership adjustments(1)						(358)						3,444
SSNOI at Welltower Share						170,686						161,523
Outpatient Medical:
Consolidated NOI						53,299						146,410
NOI attributable to unconsolidated investments						4,254						4,033
NOI attributable to noncontrolling interests						(1,213)						(2,554)
NOI attributable to non-same store properties						(30,000)						(121,744)
Non-cash NOI attributable to same store properties						(2,442)						(2,857)
SSNOI at Welltower Share						23,898						23,288
SSNOI at Welltower Share:
Seniors Housing Operating						529,111						435,210
Triple-net						170,686						161,523
Outpatient Medical						23,898						23,288
Total						$	723,695					$	620,021
(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 table below reflects 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
																		March 31,						December 31,						September 30,						June 30,						March 31,
EBITDA Reconciliations:																		2026						2025						2025						2025						2025
Net income (loss)																		$	752,324					$	117,767					$	282,186					$	304,618					$	257,266
Interest expense																		192,715						203,784						162,052						141,157						144,962
Income tax expense (benefit)																		11,633						(4,985)						2,335						1,053						(5,519)
Depreciation and amortization																		622,752						594,151						509,812						495,036						485,869
EBITDA																		$	1,579,424					$	910,717					$	956,385					$	941,864					$	882,578
Interest Coverage Ratio:
Interest expense																		$	192,715					$	203,784					$	162,052					$	141,157					$	144,962
Capitalized interest																		8,449						7,476						6,150						8,653						11,520
Non-cash interest expense																		(10,162)						(14,546)						(14,227)						(10,231)						(12,625)
Total interest																		191,002						196,714						153,975						139,579						143,857
EBITDA																		$	1,579,424					$	910,717					$	956,385					$	941,864					$	882,578
Interest coverage ratio																		8.27		x				4.63		x				6.21		x				6.75		x				6.14		x
Fixed Charge Coverage Ratio:
Total interest																		$	191,002					$	196,714					$	153,975					$	139,579					$	143,857
Secured debt principal payments																		17,056						16,698						16,707						16,558						14,444
Total fixed charges																		208,058						213,412						170,682						156,137						158,301
EBITDA																		$	1,579,424					$	910,717					$	956,385					$	941,864					$	882,578
Fixed charge coverage ratio																		7.59		x				4.27		x				5.60		x				6.03		x				5.58		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
																		March 31,						December 31,						September 30,						June 30,						March 31,
Adjusted EBITDA Reconciliations:																		2026						2025						2025						2025						2025
Net income (loss)																		$	1,456,895					$	961,837					$	967,823					$	1,142,437					$	1,098,489
Interest expense																		699,708						651,955						602,640						579,638						571,905
Income tax expense (benefit)																		10,036						(7,116)						(2,017)						(9,058)						(9,010)
Depreciation and amortization																		2,221,751						2,084,868						1,971,123						1,865,090						1,752,099
EBITDA																		4,388,390						3,691,544						3,539,569						3,578,107						3,413,483
Loss (income) from unconsolidated entities																		17,246						14,297						12,310						3,738						(8,550)
Stock-based compensation expense																		1,555,786						1,555,858						61,467						85,827						80,645
Loss (gain) on extinguishment of debt, net																		3,816						9,245						6,156						6,575						8,280
Loss (gain) on real estate dispositions and acquisitions of controlling interests, net																		(1,817,666)						(1,449,043)						(78,847)						(347,088)						(498,681)
Impairment of assets																		73,707						121,283						99,006						119,346						101,864
Provision for loan losses, net																		(5,777)						(9,416)						(2,277)						828						7,104
Loss (gain) on derivatives and financial instruments, net																		25,617						22,407						18,961						(22,627)						(28,043)
Other expenses																		248,278						201,201						109,762						85,302						117,388
Casualty losses, net of recoveries																		10,565						11,367						13,178						14,488						13,945
Other impairment (1)																		604						604						42,582						42,582						130,296
Adjusted EBITDA																		$	4,500,566					$	4,169,347					$	3,821,867					$	3,567,078					$	3,337,731
Adjusted Interest Coverage Ratio:
Interest expense																		$	699,708					$	651,955					$	602,640					$	579,638					$	571,905
Capitalized interest																		30,728						33,799						40,483						50,001						55,826
Non-cash interest expense																		(49,166)						(51,629)						(52,226)						(47,007)						(45,729)
Total interest																		681,270						634,125						590,897						582,632						582,002
Adjusted EBITDA																		$	4,500,566					$	4,169,347					$	3,821,867					$	3,567,078					$	3,337,731
Adjusted interest coverage ratio																		6.61		x				6.57		x				6.47		x				6.12		x				5.73		x
Adjusted Fixed Charge Coverage Ratio:
Total interest																		$	681,270					$	634,125					$	590,897					$	582,632					$	582,002
Secured debt principal payments																		67,019						64,408						62,627						56,337						49,886
Total fixed charges																		748,289						698,533						653,524						638,969						631,888
Adjusted EBITDA																		$	4,500,566					$	4,169,347					$	3,821,867					$	3,567,078					$	3,337,731
Adjusted fixed charge coverage ratio																		6.01		x				5.97		x				5.85		x				5.58		x				5.28		x
(1) 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
																		March 31,						December 31,						September 30,						June 30,						March 31,
																		2026						2025						2025						2025						2025
Book capitalization:
Unsecured credit facility and commercial paper																		$	—					$	—					$	—					$	—					$	—
Long-term debt obligations(1)																		18,455,978						19,737,446						16,960,008						16,079,566						15,831,799
Cash and cash equivalents and restricted cash																		(4,819,293)						(5,209,539)						(6,940,573)						(4,523,511)						(3,610,285)
Total net debt																		13,636,685						14,527,907						10,019,435						11,556,055						12,221,514
Total equity and noncontrolling interests(2)																		44,929,270						43,202,939						39,312,382						36,546,301						34,581,977
Book capitalization																		$	58,565,955					$	57,730,846					$	49,331,817					$	48,102,356					$	46,803,491
Net debt to book capitalization ratio																		23%						25%						20%						24%						26%
Undepreciated book capitalization:
Total net debt																		$	13,636,685					$	14,527,907					$	10,019,435					$	11,556,055					$	12,221,514
Accumulated depreciation and amortization																		10,822,151						10,350,621						10,107,309						11,673,306						11,092,885
Total equity and noncontrolling interests(2)																		44,929,270						43,202,939						39,312,382						36,546,301						34,581,977
Undepreciated book capitalization																		$	69,388,106					$	68,081,467					$	59,439,126					$	59,775,662					$	57,896,376
Net debt to undepreciated book capitalization ratio																		20%						21%						17%						19%						21%
Enterprise value:
Common shares outstanding																		704,687						696,507						684,108						665,120						651,889
Period end share price																		$	197.71					$	185.61					$	178.14					$	153.73					$	153.21
Common equity market capitalization																		$	139,323,667					$	129,278,664					$	121,866,999					$	102,248,898					$	99,875,914
Total net debt																		13,636,685						14,527,907						10,019,435						11,556,055						12,221,514
Noncontrolling interests(2)																		1,135,595						1,073,441						555,564						645,775						625,218
Consolidated enterprise value																		$	154,095,947					$	144,880,012					$	132,441,998					$	114,450,728					$	112,722,646
Net debt to consolidated enterprise value ratio																		9%						10%						8%						10%						11%
(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 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, 2025 for further information on significant accounting policies that impact us. There have been no material changes to these policies to date in 2026.

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, public health emergencies 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; geopolitical tensions or conflicts, such as the ongoing conflict between Russia and Ukraine and in the Middle East, 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, 2025, 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 unaudited 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):