Welltower (WELL) risk factors: FY2025 10-K

1. Risks Arising from Our Business:

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1. We are exposed to operational and legal risks with respect to our properties that could adversely affect our revenue and operations
2. Decreases in our operators’ or tenants’ revenues or increases in our operators’ or tenants’ expenses, including as a result of increased labor costs, could affect their ability to make payments to us
3. Increased competition and oversupply may affect our operators’ and managers’ ability to meet their obligations to us
4. Our investments in and acquisitions of healthcare and seniors housing properties may be unsuccessful or fail to meet our expectations
5. Acquired properties may expose us to unknown liability
6. Competition for acquisitions may result in increased prices for properties
7. Divestitures may materially affect our financial condition, results of operations or cash flowsnew
8. Our investments in joint ventures could be adversely affected by our lack of exclusive control over these investments, our partners’ insolvency or failure to meet their obligations and disputes between us and our partners
9. We have rights to terminate our management agreements with operators, in whole or with respect to specific properties under certain circumstances, and we may be unable to replace operators if our management agreements are terminated or not renewed
10. A severe cold and flu season, epidemics or any other widespread illnesses or public health crisis and government reaction thereto, could adversely affect the occupancy of our Seniors Housing Operating and Triple-net properties
11. The insolvency or bankruptcy of our tenants, operators, borrowers, managers and other obligors may adversely affect our business, results of operations and financial condition
12. Ownership of property outside the U.S. may subject us to different or greater risks than those associated with our domestic operations
13. We may be adversely affected by changing laws and regulation, including restrictions related to REIT ownershipnew
14. If our tenants do not renew their existing leases, or if we are required to sell properties for liquidity reasons, we may be unable to lease or sell the properties on favorable terms, or at all
15. Our tenants, operators and managers may not have the necessary insurance coverage to insure adequately against losses
16. Our ownership of properties through ground leases exposes us to the loss of such properties upon breach or termination of the ground leases
17. The requirements of, or changes to, governmental reimbursement programs, such as Medicare, Medicaid or government funding, could have a material adverse effect on our obligors’ liquidity, financial condition and results of operations, which could adversely affect our obligors’ ability to meet their obligations to us
18. If controls imposed on certain of our tenants who provide healthcare services that are reimbursed by Medicare, Medicaid and other third-party payors to reduce admissions and length of stay affect inpatient volumes at our healthcare facilities, the financial condition or results of operations of those tenants could be adversely affected
19. Our operators’, managers’ or tenants’ failure to comply with federal, state, province, local and industry-regulated licensure, certification and inspection laws, regulations and standards could adversely affect such operators’, managers’ or tenants’ operations, which could adversely affect their ability to meet their obligations to us
20. Unfavorable resolution of pending and future litigation matters and disputes could have a material adverse effect on our financial condition
21. Development, redevelopment and construction risks could affect our profitability
22. Bank failures or other events affecting financial institutions could have a material adverse effect on our and our operators’ and tenants’ liquidity, results of operations and financial condition
23. We may experience losses caused by severe weather conditions, natural disasters or the physical effects of climate change, which could result in an increase in our or our tenants’ cost of insurance, unanticipated costs associated with evacuation, a decrease in our anticipated revenues or a significant loss of the capital we have invested in a propertyreworded

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1. We may incur costs to remediate environmental contamination at our properties, which could have an adverse effect on our or our obligors’ business or financial condition
2. Cybersecurity incidents could disrupt our business and result in the loss of confidential information and legal liabilityCybersecurity
3. Evolving privacy regulations could expose our business to reputational harm and losses
4. Our approach to AI presents risks and challenges that can adversely impact our businessrewordedAI
5. Negative publicity regarding the healthcare industry could adversely affect our operations
6. Our success and the success of our operators and managers depends on key personnel whose continued service is not guaranteed
7. Welltower is a holding company with no direct operations, and it relies on funds received from Welltower OP to pay its obligations and make distributions to stockholders

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1. We may become more leveraged
2. Cash available for distributions to stockholders may be insufficient to make dividend contributions at expected levels and are made at the discretion of the Board
3. We are subject to covenants in our debt agreements that could have a material adverse effect on our business, results of operations and financial condition
4. Limitations on our ability to access capital could have an adverse effect on our ability to make future investments or to meet our obligations and commitments
5. Downgrades in our credit ratings could have a material adverse effect on our cost and availability of capital
6. Elevated interest rates, or future interest rate increases, could have a material adverse effect on our cost of capital, and our decision to hedge against interest rate risk might not be effectiveInterest rates

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1. We might fail to qualify or remain qualified as a REIT
2. Failure of Welltower OP to maintain status as a partnership for U.S. federal income tax purposes
3. Certain subsidiaries might fail to qualify or remain qualified as a REIT
4. The tax imposed on any net income from “prohibited transactions” may limit our ability to engage in transactions which would be treated as sales for federal income tax purposes
5. The 90% annual distribution requirement will decrease our liquidity and may limit our ability to engage in otherwise beneficial transactions
6. Our use of TRSs is limited under the Code
7. The lease of qualified healthcare properties to a TRS is subject to special requirements
8. If certain sale-leaseback transactions are not characterized by the IRS as “true leases,” we may be subject to adverse tax consequences
9. We could be subject to changes in our U.S. and non-U.S. tax rates, the adoption of new U.S. or non-U.S. tax legislation, or exposure to additional U.S. and non-U.S. tax liabilitiesreworded
10. The impact to our TRSs of the Corporate Alternative Minimum Tax imposed by the Inflation Reduction Act of 2022 is uncertain and may be adverse

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