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What changed in Sila Realty Trust, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Sila Realty Trust, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+333 added−406 removedSource: 10-K (2026-02-25) vs 10-K (2025-03-03)

Top changes in Sila Realty Trust, Inc.'s 2025 10-K

333 paragraphs added · 406 removed · 229 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

37 edited+22 added−19 removed33 unchanged
Biggest changeThe PAM Amended Lease Agreements extend the term of each lease to a 20-year remaining lease term, with each maturing on November 30, 2044, and no changes to the base rental rate. • We entered into a senior unsecured amended and restated term loan agreement, or the 2027 Term Loan Agreement, with Truist Bank, as Administrative Agent for the lenders, for aggregate commitments of $250,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $500,000,000.
Biggest changeThe Mezzanine Loans have total loan amounts of $12,543,000 and $5,000,000, respectively, and a maturity date of November 5, 2029. • We entered into a senior unsecured revolving line of credit with Bank of America, N.A., as Administrative Agent for the lenders, or the 2029 Revolving Credit Agreement, for aggregate commitments available of up to $600,000,000, which may be increased, subject to lender approval, through incremental term loans and/or revolving loan commitments in an aggregate amount not to exceed $1,500,000,000.
To maintain our qualification as a REIT, we must meet certain organizational and operational requirements, including a requirement to currently distribute at least 90.0% of our REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gain, to our stockholders.
To maintain our qualification as a REIT, we must meet certain organizational and operational requirements, including a requirement to currently distribute at least 90% of our REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gain, to our stockholders.
Financing for acquisitions and investments may be obtained at the time an asset is acquired or an investment is made or at a later time. In addition, debt financing may be used from time to time for property improvements, tenant improvements, leasing commissions and other working capital needs.
Financing for acquisitions and investments may be obtained at the time an asset is acquired or an investment is made or at a later time. In addition, debt financing may be used from time to time for property improvements, developments, tenant improvements, leasing commissions and other working capital needs.
At the time we determine to dispose of our properties, we are typically in competition with sellers of similar properties to locate suitable purchasers for our properties. Concentration of Credit Risk and Significant Tenants As of December 31, 2024, we had cash on deposit in certain financial institutions that had deposits in excess of current federally insured levels.
At the time we determine to dispose of our properties, we are typically in competition with sellers of similar properties to locate suitable purchasers for our properties. Concentration of Credit Risk and Significant Tenants As of December 31, 2025, we had cash on deposit in certain financial institutions that had deposits in excess of current federally insured levels.
We cannot assure stockholders that we will attain these objectives or that the value of our assets will not decrease. Furthermore, within our investment objectives and policies, we have substantial discretion with respect to the selection of specific investments and the purchase and sale of our assets, subject to the approval of the Board.
We cannot assure stockholders that we will attain these objectives or that the value of our assets will not decrease. Furthermore, within our investment objectives and policies, we have substantial discretion with respect to the selection of specific investments and the purchase and sale of our assets, subject to the approval of the Board, as applicable.
Competition As we purchase properties for our portfolio, we are in competition with other potential buyers (some of whom have more cash, available liquidity, and/or offer competitive advantages versus us in the acquisition of properties) for the same properties and may have to pay more to purchase the property than if there were no other potential acquirers, or we may have to locate 5 Table of Contents another property that meets our investment criteria.
Competition As we purchase properties for our portfolio, we are in competition with other potential buyers (some of whom have more cash, available liquidity, and/or offer competitive advantages versus us in the acquisition of properties) for the same properties and may have to pay more to purchase the property than if there were no other potential acquirers, or we may have to locate another property that meets our investment criteria.
We limit cash investments to financial institutions with high credit standing; therefore, we do not believe we are exposed to any significant credit risk on our cash deposits. To date, we have not experienced any loss of or lack of access to cash in our accounts.
We limit cash investments to financial institutions with high credit standings; therefore, we do not believe we are exposed to any significant credit risk on our cash deposits. To date, we have not experienced any loss of or lack of access to cash in our accounts.
Investment Decisions In evaluating investments in properties, we consider various factors, including, to the extent such information is available with respect to such property, the following: • proposed purchase price, terms and conditions; • physical condition, age, and environmental reports; • location, visibility and access; • historical financial performance; • tenants in place and tenant creditworthiness; • lease terms, including rent, rent increases, length of lease term, specific tenant and landlord responsibilities, renewal, expansion, termination, purchase options, exclusive and permitted uses provisions, assignment and sublease provisions, and co-tenancy requirements; • local market economic conditions, demographics and population growth patterns; • neighboring properties; and • potential for new property construction in the area.
Investment Decisions In evaluating investments in properties, we consider various factors, including, but not limited to, to the extent such information is available with respect to such property, the following: • proposed purchase price, terms and conditions; • physical condition, age, and environmental reports; • location, visibility and access; • historical financial performance; • tenants in place and tenant creditworthiness; • lease terms, including rent, rent increases, length of lease term, specific tenant and landlord responsibilities, renewal, expansion, termination, purchase options, exclusive and permitted uses provisions, assignment and sublease provisions, and co-tenancy requirements; 3 Table of Contents • local market economic conditions, demographics and population growth patterns; • neighboring properties; and • potential for new property construction in the area.
Investment Objectives and Policies Our primary investment objectives at this time are to: • acquire high quality healthcare properties leased to tenants along the continuum of care; • pay regular cash distributions to stockholders; • preserve, protect and return capital contributions to stockholders; • realize appreciated growth in the value of our investments upon the sale of such investments in whole or in part; and • be prudent, patient and deliberate with respect to the purchase and sale of our investments considering current and projected real estate and financial markets.
Investment Objectives and Policies Our primary investment objectives at this time are to: • acquire high quality net lease healthcare properties leased to tenants along the continuum of care; • pay regular cash distributions to stockholders; • preserve, protect and return capital contributions to stockholders; • realize appreciated growth in the value of our investments upon the sale of such investments in whole or in part; and 2 Table of Contents • be prudent, patient and deliberate with respect to the purchase and sale of our investments considering current and projected real estate and financial markets.
Investing in and Originating Loans Our criteria for originating or acquiring loans are substantially the same as those involved in our investment in properties. We may invest in mortgage, bridge or mezzanine loans. Further, we may invest in unsecured loans or loans secured by assets other than real estate.
Investing in and Originating Loans Our criteria for originating or acquiring loans are substantially the same as those involved in our investment in properties. We have and may continue to invest in mortgage, bridge or mezzanine loans. Further, we may invest in unsecured loans or loans secured by assets other than real estate.
We aim to act with the highest integrity and operate with the highest ethical standards as we strive to create and maintain an inclusive work environment that values the uniqueness of each individual and his or her ideas and experiences.
We aim to act with the highest integrity and operate with the highest ethical standards as we strive to create and maintain an inclusive work environment that values the uniqueness of each individual and his or her ideas 7 Table of Contents and experiences.
In accordance with our organizational documents and Maryland law, we may not make distributions that would: (1) cause us to be unable to pay our debts as they become due in the ordinary course of business; (2) cause our total assets to be less than the sum of our total liabilities plus senior liquidation preferences, if any; or (3) jeopardize our ability to maintain our qualification as a REIT.
In accordance with our organizational documents and Maryland law, we may not make distributions that would: (i) cause us to be unable to pay our debts as they become due in the ordinary course of business; (ii) cause our total assets to be less than the sum of our total liabilities plus senior liquidation preferences, if any; or (iii) jeopardize our ability to maintain our qualification as a REIT.
General Description of Business and Operations Sila Realty Trust, Inc. is a Maryland corporation that was formed on January 11, 2013, headquartered in Tampa, Florida, that has elected, and currently qualifies, to be taxed as a real estate investment trust, or a REIT, under the Internal Revenue Code of 1986, as amended, or the Code, for federal income tax purposes.
General Description of Business and Operations Sila Realty Trust, Inc. is a Maryland corporation that was formed on January 11, 2013, headquartered in Tampa, Florida, that has elected, and conducts its operations so as to qualify, to be taxed as a real estate investment trust, or a REIT, under the Internal Revenue Code of 1986, as amended, or the Code, for federal income tax purposes.
We continue to prioritize having "The Right People, In The Right Places, Doing The Right Things." Core Values: We believe that our employees are aligned around core values that inspire our behavior as individuals and as an organization. Our core values are essential to the Company's culture.
We continue to prioritize having “The Right People, In The Right Places, Doing The Right Things.” Core Values: We expect that our employees are aligned around core values that inspire our behavior as individuals and as an organization. Our core values are essential to the Company’s culture.
Corporate Culture: Our strong tone at the top begins with the Board, which has demonstrated its focus on advancing openness, honesty, fairness and integrity within the Company. Ethical behavior is an important cornerstone of our continued success and each of us has an obligation to report any accounting irregularity, theft, discrimination, harassment or other violation of the law.
Corporate Culture: Our strong tone at the top begins with the Chief Executive Officer, who has demonstrated his focus on advancing openness, honesty, fairness and integrity within the Company. Ethical behavior is an important cornerstone of our continued success and each of us has an obligation to report any accounting irregularity, theft, discrimination, harassment or other violation of the law.
We monitor tenant credit by: (1) reviewing the credit ratings of tenants (or their parent companies) that are rated by nationally recognized rating agencies; (2) reviewing financial statements that are publicly available or that are required to be delivered to us under the applicable lease; (3) monitoring industry reports and other available information regarding our tenants and their underlying businesses; (4) monitoring the timeliness of rent collections; and (5) conducting periodic inspections of our properties to ascertain patient utilization and proper maintenance, repair and upkeep.
We monitor tenant credit by: (i) reviewing the credit ratings of tenants (or their parent companies) that are rated by nationally recognized rating agencies; (ii) reviewing financial statements that are publicly available or that are required to be delivered to us under the applicable lease; (iii) monitoring industry reports and other available information regarding our tenants and their underlying businesses; (iv) monitoring the timeliness of rent collections; and (v) conducting periodic inspections of our properties to ascertain patient utilization and proper maintenance, repair and upkeep.
They describe for each employee the expectation of a "HI ACT" and that is with humility, with integrity, with accountability, with transparent and honest communication and by embracing teamwork. Human Capital Resources As of December 31, 2024, we had 49 employees. None of our employees are represented by a labor union or covered by a collective bargaining agreement.
They describe for each employee the expectation of a “HI ACT” and that is to act with humility, with integrity, with accountability, with transparent and honest communication and by embracing teamwork. Human Capital Resources As of December 31, 2025, we had 47 employees. None of our employees are represented by a labor union or covered by a collective bargaining agreement.
While we believe that we are currently in material compliance with these regulatory requirements, the requirements may change or new requirements may be imposed that could require significant unanticipated expenditures by us. Significant regulatory requirements include the laws and regulations described below.
While we believe that we are currently in material compliance with these regulatory requirements, the requirements may change or new requirements may be imposed that could require significant unanticipated expenditures by us.
We may purchase the common stock, preferred stock, debt, or other securities of these entities or options to acquire such securities. 4 Table of Contents Acquisition Structure We have and expect to continue to acquire fee interests in properties (a fee interest is the absolute, legal possession and ownership of land, property, or rights), although we may utilize, and we have utilized, other methods of acquiring a property, such as a leasehold interest in the land, if we deem them to be advantageous.
Acquisition Structure We have and expect to continue to acquire fee interests in properties (a fee interest is the absolute, legal possession and ownership of land, property, or rights), although we may utilize, and we have utilized, other methods of acquiring a property, such as a leasehold interest in the land, if we deem them to be advantageous.
The neighborhood in which the office building is located is part of a community that has achieved the WELL Design & Operations designation under the WELL Community Standard, the first neighborhood to do so in North America. The WELL Building Standard takes a holistic approach to health in the built environment addressing behavior, operations and design.
The neighborhood in which the office building is located is part of a community that has achieved the WELL Design & Operations designation under the WELL Community Standard, the first neighborhood to do so in North America.
The following table shows the tenant that accounted for 10% or more of our rental revenue for the year ended December 31, 2024: Tenant Total Number of Leases Leased Sq Ft 2024 Rental Revenue (in thousands) Percentage of 2024 Rental Revenue Post Acute Medical, LLC, and its affiliates (1) 15 708,817 $ 27,754 14.9 % (1) The leases are with tenants under the common control of Post Acute Medical, LLC and its affiliates and have lease expiration dates on November 30, 2044.
The following table shows the only tenant that accounted for 10% or more of our rental revenue for the year ended December 31, 2025: Tenant Total Number of Leases Leased Sq Ft 2025 Rental Revenue (in thousands) Percentage of 2025 Rental Revenue PAM Health (1) 15 708,817 $ 31,622 16.1 % (1) The leases are with tenants under the common control of PAM Health and its affiliates and have lease expiration dates between November 30, 2044 and December 14, 2045.
The building is WELL Gold v2 Certified and LEED Silver Certified. We intend to take all reasonable steps to fully comply with environmental laws and regulations for our real estate properties, including obtaining environmental assessments of all properties that we acquire.
We intend to take all reasonable steps to fully comply with environmental laws and regulations for our real estate properties, including obtaining environmental assessments of all properties that we acquire.
The Company has a volunteer program whereby employees are provided 24 paid hours each year to use for service to the community. In addition, the Company organizes several group volunteer opportunities each year to support our local communities and foster a culture of giving back. Our social impact programs are in support of several non-for-profit organizations.
In addition, the Company organizes several group volunteer opportunities each year to support our local communities and foster a culture of giving back. Our social impact programs are in support of several non-profit organizations.
We had no exposure to geographic concentration that accounted for 10% or more of our rental revenue for the year ended December 31, 2024.
We had no exposure to geographic concentrations within a metropolitan statistical area that accounted for 10% or more of our rental revenue for the year ended December 31, 2025.
Except as the context otherwise requires, “we,” “our,” “us,” and the “Company” refer to Sila Realty Trust, Inc., our Operating Partnership and all wholly-owned subsidiaries. We are an internally managed company primarily focused on investing in high quality healthcare facilities across the continuum of care, which we believe typically generate predictable, durable and growing income streams.
Except as the context otherwise requires, “we,” “our,” “us,” and the “Company” refer to Sila Realty Trust, Inc., our Operating Partnership and all wholly-owned subsidiaries. We are an internally managed company primarily focused on investing in the growing and resilient healthcare sector.
In determining whether to invest in a particular joint venture, we evaluate the assets of the joint venture under the criteria described elsewhere in this Annual Report on Form 10-K for the selection of our investments. We also evaluate the terms of the joint venture, as well as the financial condition, operating capabilities and integrity of our partner or partners.
In determining whether to invest in a particular joint venture, we evaluate the assets of the joint venture under the investment strategy criteria described above. We also evaluate the terms of the joint venture, as well as the financial condition, operating capabilities and integrity of our partner or partners.
Such disclosures will be included on our website under the heading “Investors.” Accordingly, investors should monitor such portion of our website in addition to following our press releases, public conference calls, and filings with the SEC.
We intend to use our website as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included on our website under the heading “Investors.” Accordingly, investors should monitor such portion of our website in addition to following our press releases, public conference calls, and filings with the SEC.
This determination is made based upon a variety of factors, including the available risk-adjusted returns for such properties when compared with other available properties, the effect such properties would have on the diversification of our portfolio, and our investment objectives of realizing both current income and capital appreciation upon the sale of such properties. 3 Table of Contents We endeavor to achieve a well-balanced portfolio of real estate investments that is diversified by tenancy, geographic location, age and lease maturities.
This determination is made based upon a variety of factors, including the available risk-adjusted returns for such properties when compared with other available properties, the effect such properties would have on the diversification of our portfolio, and our investment objectives of realizing both current income and capital appreciation upon the sale of such properties.
REIT Laws and Regulations We elected, and qualify, to be taxed as a REIT under Sections 856 through 860 of the Code.
Significant regulatory requirements include the laws and regulations described below. 5 Table of Contents REIT Laws and Regulations We elected, and conduct our operations so as to qualify, to be taxed as a REIT under Sections 856 through 860 of the Code.
Distribution Policy The amount of distributions we pay to our stockholders is determined by the Board and is dependent on a number of factors, including funds available for payment of distributions, our financial condition, capital expenditure requirements, annual distribution requirements needed to maintain our status as a REIT under the Code and restrictions imposed by our organizational documents and Maryland law.
We will not enter into interest rate swaps or caps, or similar hedging transactions or derivative arrangements for speculative purposes, but may do so in order to manage or mitigate our interest rate risk on variable rate debt. 4 Table of Contents Distribution Policy The amount of distributions we pay to our stockholders is determined by the Board and is dependent on a number of factors, including funds available for payment of distributions, our financial condition, the timing of property acquisitions, capital expenditure requirements, annual distribution requirements needed to maintain our status as a REIT under the Code and restrictions imposed by our organizational documents and Maryland law.
New York Stock Exchange Listing and Reverse Stock Split On June 13, 2024, our common stock, par value $0.01 per share, or our Common Stock, was listed and began trading on the New York Stock Exchange, or the NYSE, under the ticker symbol "SILA", or the Listing.
We may also make other real estate related investments, which may include equity or debt interests in other real estate entities. On June 13, 2024, our common stock, par value $0.01 per share, or our Common Stock, was listed and began trading on the New York Stock Exchange, or the NYSE, under the ticker symbol “SILA”.
We seek to acquire properties primarily in the high-growth healthcare sector with tenants that are diversified among national, regional and local entities. Creditworthy Tenants We expect the tenants and/or sponsors of the tenants of our healthcare properties to be creditworthy national, regional or local companies generally with high net worth and high operating income.
Creditworthy Tenants We expect the tenants and/or sponsors of the tenants of our healthcare properties to be creditworthy national, regional or local companies generally with high net worth and high operating income. A tenant is considered creditworthy if it has a financial profile that we believe meets our criteria.
Such an event could have a material adverse effect on our net income and net cash available for distribution to our stockholders. Environmental Laws and Regulations All real estate properties and the operations conducted on the real estate properties are subject to federal, state and local laws and regulations relating to environmental protection and human health and safety.
Such an event could have a material adverse effect on our net income and net cash available for distribution to our stockholders. Healthcare Licensure and Certificate of Need Our tenants operate healthcare facilities that are subject to federal, state and local licensure, certification and inspection laws and regulations.
We strive to support each of our employees engaging in the community in areas in which they are passionate and supporting causes that are personally meaningful to them. Employees are encouraged to drive positive change by dedicating their time and talent to non-profit organizations.
Social Impact and Community: Our mission is to engage, inspire, and empower our employees to make a positive impact on our community where we work and live. We strive to support each of our employees engaging in the community in areas in which they are passionate and supporting causes that are personally meaningful to them.
The Corporate Responsibility Committee meets at least annually to discuss our strategy, initiatives, and progress, in support of our on-going commitment to corporate governance, social responsibility, environmental matters, sustainability, health and safety. 6 Table of Contents Environmental, Social and Governance We lease Class A Office space in a tenant focused experiential building that intends to deliver a restorative professional environment that cultivates productivity, collaboration, betterment and balance.
We also carry environmental liability insurance on our properties, which provides coverage for pollution liability, third-party bodily injury and property damage claims. Corporate Responsibility We lease Class A Office space in a tenant focused experiential building that intends to deliver a restorative professional environment that cultivates productivity, collaboration, betterment and balance.
The form of our indebtedness will vary and could be long-term or short-term, secured or unsecured, or fixed-rate or floating rate. We will not enter into interest rate swaps or caps, or similar hedging transactions or derivative arrangements for speculative purposes, but may do so in order to manage or mitigate our interest rate risk on variable rate debt.
The form of our indebtedness will vary and could be long-term or short-term, secured or unsecured, or fixed-rate or floating rate.
In connection with ownership and operation of real estate, we may be potentially liable for costs and damages related to environmental matters. Corporate Responsibility We are committed to practicing strong corporate governance, being socially conscious, and environmentally aware. In early 2022, the Board established the Corporate Responsibility Committee, led by members of our management team and other senior managers.
Environmental Laws and Regulations All real estate properties and the operations conducted on the real estate properties are subject to federal, state and local laws and regulations relating to environmental protection and human health and safety. In connection with ownership and operation of real estate, we may be potentially liable for costs and damages related to environmental matters.
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We may also make other real estate-related investments, which may include equity or debt interests in other real estate entities.
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We invest in high quality net lease healthcare facilities across the continuum of care, in the pursuit of generating predictable, durable and growing income streams. Our properties include, among others, medical outpatient buildings, inpatient rehabilitation facilities and surgical and specialty facilities.
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Upon the Listing, all outstanding shares of Class I Common Stock and Class T Common Stock were automatically converted into shares of Class A Common Stock on a one-for-one basis and authorized but unissued shares of Class I Common Stock, Class T Common Stock and Class T2 Common Stock were reclassified into additional shares of Class A Common Stock.
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As of December 31, 2025, we owned 140 real estate healthcare properties and three undeveloped land parcels, including the Stoughton Healthcare Facility which has been taken out of service and is being demolished.
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Class A Common Stock was then immediately renamed “Common Stock” and is the sole class of stock traded on the NYSE.
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Key Developments During 2025 • We purchased six operating healthcare properties, comprising approximately 241,000 rentable square feet for an aggregate purchase price of approximately $148,877,000. • We fully funded two mezzanine loans for the development of an inpatient rehabilitation facility and a behavioral healthcare facility in Lynchburg, Virginia, or the Mezzanine Loans.
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On April 8, 2024, in anticipation of the Listing, we amended our charter to effect a one-for-four reverse stock split, or the Reverse Stock Split, of each issued and outstanding share of each class of our Common Stock, effective May 1, 2024, and we also amended our charter to decrease the par value of each issued and outstanding share of our Common Stock from $0.04 par value per share to $0.01 par value per share immediately after the Reverse Stock Split.
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The maturity date for the 2029 Revolving Credit Agreement is February 16, 2029, which, at the Company’s election, may be extended for a period of six-months on no more than two occasions, subject to certain conditions, including a payment of an extension fee. • On August 4, 2025, the board of directors, or the Board, authorized a share repurchase program of up to $75,000,000 in gross purchase proceeds for a period of three-years from August 4, 2025, subject to the limitation of $25,000,000 in gross purchase proceeds in any twelve-month period. • Filed with the Securities and Exchange Commission, or the SEC, an automatic shelf registration statement on Form S-3 that is effective for a term of three years, covering future offerings of an indeterminate amount of our Common Stock, preferred stock, depositary shares, warrants, purchase contracts and units. • Entered into an ATM Equity Offering Sales Agreement through which, from time to time, we may offer and sell shares of Common Stock having an aggregate offering price of up to $250,000,000.
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In addition, equitable adjustments were made to the maximum number of shares of our Common Stock that may be issued pursuant to our Amended and Restated 2014 Restricted Share Plan, or the A&R Incentive Plan, to reflect the Reverse Stock Split.
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We endeavor to achieve a well-balanced portfolio of real estate investments that is diversified by tenancy, geographic location, age and lease maturities. We seek to acquire properties primarily in the high-growth healthcare sector with tenants that are diversified among national, regional and local entities.
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The number of shares of our Common Stock subject to outstanding awards under the A&R Incentive Plan were also equitably adjusted to reflect the Reverse Stock Split. The Reverse Stock Split affected all record holders of our Common Stock uniformly and did not affect any record holder’s percentage ownership interest.
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We may purchase the common stock, preferred stock, debt, or other securities of these entities or options to acquire such securities.
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The Reverse Stock Split did not affect the number of our authorized shares of Common Stock. All references made to share or per share amounts in the accompanying consolidated financial statements and applicable disclosures have been retroactively adjusted as though the Reverse Stock Split had been effectuated prior to all periods presented.
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Many states require certain healthcare providers to obtain a certificate of need, or CON, which requires prior approval for the construction, modification and closure of certain healthcare facilities. The ability to obtain such approval and/or the approval process may impact some of our tenants’ abilities to expand or change their businesses.
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"Dutch Auction" Tender Offer On June 13, 2024, in conjunction with the Listing, we commenced a modified "Dutch Auction" tender offer, or the Tender Offer, to purchase shares of our Common Stock for cash at a price per share of not greater than $24.00 nor less than $22.60, net to the seller in cash, less any applicable withholding taxes and without interest, for a maximum aggregate purchase price of no more than $50,000,000.
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Any failure to comply with any of these laws, regulations, or standards could result in penalties which may include loss or restriction of license, loss of accreditation, denial of reimbursement, imposition of fines, suspension or decertification from federal and state healthcare programs, or closure of the facility.
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The Tender Offer expired on July 19, 2024.
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Fraud and Abuse Laws There are various federal and state laws prohibiting fraudulent and abusive business practices by healthcare providers who participate in, receive payments from, or are able to make referrals in connection with, government-sponsored healthcare programs, including the Medicare and Medicaid programs. Our leases with certain tenants may also be subject to these fraud and abuse laws.
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As a result of the Tender Offer, we accepted for purchase 2,212,389 shares of Common Stock (which represented approximately 3.9% of the total number of shares of Common Stock outstanding as of July 19, 2024) at a purchase price of $22.60 per share, for an aggregate purchase price of approximately $50,000,000, excluding all related costs and fees.
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These laws include, without limitation: (i) the Federal Anti-Kickback Statute, which prohibits, among other things, the offer, payment, solicitation or receipt of any form of remuneration in return for, or to induce, the referral of any U.S. federal or state healthcare program patients; (ii) the Federal Physician Self-Referral Prohibition, which, subject to specific exceptions, restricts physicians who have financial relationships with healthcare providers from making referrals for designated health services for which payment may be made under Medicare or Medicaid programs to an entity with which the physician, or an immediate family member, has a financial relationship; (iii) the False Claims Act, which prohibits any person from knowingly presenting false or fraudulent claims for payment to the federal government, including under the Medicare and Medicaid programs; (iv) the Civil Monetary Penalties Law, which authorizes the Department of Health and Human Services to impose monetary penalties for certain fraudulent acts; and (v) state anti-kickback, anti-inducement, anti-referral and insurance fraud laws which may be generally similar to, and potentially more expansive than, the federal laws set forth above.
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We incurred $2,093,000 of costs and fees related to the Tender Offer which are recorded as a reduction in equity on the accompanying consolidated financial statements. We funded the Tender Offer and related costs and fees with our available cash. As of December 31, 2024, we owned 135 real estate healthcare properties and two undeveloped land parcels.
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Violations of these laws may result in criminal and/or civil penalties that range from punitive sanctions, damage assessments, penalties, imprisonment, denial of Medicare and Medicaid payments and/or exclusion from the Medicare and Medicaid programs. Additionally, certain laws, such as the False Claims Act, allow for individuals to bring whistleblower actions on behalf of the government for violations thereof.
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Key Developments During 2024 • On June 13, 2024, our Common Stock was listed and began trading on the NYSE. • On July 29, 2024, we concluded the Tender Offer, for an aggregate purchase price of approximately $50,000,000, excluding all related costs and fees.
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Imposition of any of these penalties upon one of our tenants could jeopardize that tenant’s ability to operate or to make rent payments to us.
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We incurred $2,093,000 of costs and fees related to the Tender Offer which are recorded as a reduction in equity on the accompanying consolidated financial statements. 2 Table of Contents • The board of directors, or the Board, approved the termination of our distribution reinvestment plan, or the DRIP, effective May 1, 2024, and approved the termination of our share repurchase program effective upon the Listing. • We purchased eight operating healthcare properties, comprising approximately 307,000 rentable square feet for an aggregate purchase price of approximately $164,053,000. • We sold four healthcare facilities for an aggregate sale price of $18,700,000 and generated net proceeds of $17,705,000. • We entered into two mezzanine loans for the development of an inpatient rehabilitation facility and a behavioral healthcare facility in Lynchburg, Virginia, or the Mezzanine Loans.
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Privacy, Security and Data Breach Notification Laws The Health Insurance Portability and Accountability Act of 1996, as amended, or HIPAA regulates the privacy and security of certain health information, or Protected Health Information, and requires entities subject to HIPAA to provide notification of breaches of Protected Health Information. Healthcare providers, including many of our tenants, are subject to HIPAA.
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The Mezzanine Loans have total loan amounts of $12,543,000 and $5,000,000, respectively, and a maturity date of November 5, 2029. Funding is expected to commence in 2025. • We entered into 15 amended lease agreements, effective December 1, 2024, with certain subsidiaries of Post Acute Medical, LLC, or the PAM Amended Lease Agreements, related to 15 properties.
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Breaches of unsecured Protected Health Information and other violations of HIPAA may have other material adverse consequences including material loss of business, business interruption, loss of patient or other critical data, regulatory enforcement, substantial legal liability and reputational harm. Certain violations of HIPAA can result in criminal penalties and enforcement.
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The maturity date for the 2027 Term Loan is March 20, 2027 and, at our election, may be extended for a period of one year on no more than two occasions, subject to the satisfaction of certain conditions, including the payment of an extension fee.
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Various other state and federal laws relate to privacy, security and the reporting of data breaches involving personal information, or, together with HIPAA, Privacy Laws.
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The 2027 Term Loan Agreement was entered into to replace the 2024 Term Loan (as defined below), which was paid off in its entirety upon closing of the 2027 Term Loan Agreement.
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For example, various state laws and regulations may regulate the privacy and security of personal information, and require notification of affected individuals in the event of a data breach involving such individual’s personal information (including an individual’s name plus social security number, date of birth or credit card information, for example).
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A tenant is considered creditworthy if it has a financial profile that we believe meets our criteria.
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Failure of the Company or its tenants to comply with applicable Privacy Laws could have a materially adverse effect on our Company. Failure of our tenants to comply with applicable Privacy Laws could have a material 6 Table of Contents adverse effect on their ability to meet their obligations to us.
Removed
We also carry environmental liability insurance on our properties, which provides coverage for pollution liability, third-party bodily injury and property damage claims. Social Impact and Community: Our mission is to engage, inspire, and empower our employees to make a positive impact on our community where we work and live.
Added
Furthermore, the adoption of new Privacy Laws at the federal and state level could require us or our tenants to incur significant compliance costs. Americans with Disabilities Act Under the Americans with Disabilities Act of 1990, as amended, or the ADA, all public accommodations must meet federal requirements for access and use by disabled persons.
Removed
We intend to use our website 7 Table of Contents as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD.
Added
These laws may require removal of barriers to access by persons with disabilities in certain public areas of our properties where such removal is readily achievable. Under our triple-net lease structure, our tenants would generally be responsible for additional costs that may be required to make our facilities ADA-compliant.
Added
Noncompliance with the ADA could result in the imposition of fines or an award of damages to private litigants. Our commitment to make readily achievable accommodations pursuant to the ADA is ongoing, and we continue to assess our properties and make modifications as appropriate in this respect.
Added
The WELL Building Standard takes a holistic approach, offering living workplaces informed by nature and innovation thus creating conditions for personal and professional fulfillment. The building is WELL Gold v2 Certified and LEED Silver Certified.
Added
Employees are encouraged to drive positive change by dedicating their time and talent to non-profit organizations. The Company has a volunteer program whereby employees are provided 24 paid hours each year to use for service to the community.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe cannot assure you that the market price of our Common Stock will not fluctuate or decline significantly in the future. 20 Table of Contents General Risk Factors Cybersecurity risks and cyber incidents may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our business relationships, all of which could negatively impact our financial results.
Biggest changeFactors that could negatively affect our market price include, but are not limited to, • limited trading volume, which may depress the price of our Common Stock or subject our Common Stock to greater price volatility, • actual or anticipated declines in our operating results or distributions, • changes in government regulations or spending (including Medicare spending), • changes in laws affecting REITs and related tax matters, • changes in market valuations of similar companies, • adverse market reaction to any increased indebtedness we may incur in the future, • issuance of additional equity securities, • actions by institutional investors, • changes in law affecting REITs and related tax matters, • publication of research reports about us or the real estate industry, • speculation in the press or investment community, • additions or departures of key management personnel, • changes in our credit ratings, • changes in our market expectations of our funds from operations, core funds from operations, and adjusted funds from operations, and • general market and economic conditions. 19 Table of Contents General Risk Factors Cybersecurity risks and incidents may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our business relationships, all of which could negatively impact our financial results.
The generally fixed nature of revenues and the variable rate of debt obligations could create interest rate risk for us. Increases in interest rates may not be matched by increases in our rental income, which could increase our expenses and adversely affect our business, financial condition, results of operations, and ability to make distributions to our stockholders.
The generally fixed nature of revenues and the variable rate of debt obligations and other expenses could create interest rate risk for us. Increases in interest rates may not be matched by increases in our rental income, which could increase our expenses and adversely affect our business, financial condition, results of operations, and ability to make distributions to our stockholders.
Some of our leases will not contain rental increases over time, the rental increases may be less than the fair market rate at a future point in time, or we may not be able to renew or re-lease space at current rents.
Some of our leases may not contain rental increases over time, the rental increases may be less than the fair market rate at a future point in time, or we may not be able to renew or re-lease space at current rents.
The factors affecting economic conditions in the continental United States real estate market include, but are not limited to: financial performance and productivity of, among others, the publishing, advertising, financial, technology, retail, insurance and real estate industries; business layoffs or downsizing; industry slowdowns; potential government shutdowns; relocations of businesses; changing demographics; increased telecommuting and use of alternative workplaces; infrastructure quality; any oversupply of, or reduced demand for, real estate; concessions or reduced rental rates under new leases for properties where tenants defaulted; increased insurance premiums; and increased interest rates.
The factors affecting economic conditions in the continental United States real estate market include, but are not limited to: financial performance and productivity of, among others, the publishing, advertising, financial, technology, retail, insurance and real estate industries; business layoffs or downsizing; industry slowdowns; potential government shutdowns; relocations of businesses; changing demographics; increased telecommuting and use of alternative workplaces; infrastructure quality; any oversupply of, or reduced demand for, real estate; 12 Table of Contents concessions or reduced rental rates under new leases for properties where tenants defaulted; increased insurance premiums; and increased interest rates.
The healthcare industry is currently experiencing, among other things: changes in the demand for and methods of delivering healthcare services, particularly as telemedicine and telehealth continue to gain popularity, as well as continued innovation and integration of technological advancements and artificial intelligence; a shift in the provision of healthcare services from inpatient to outpatient settings; changes in third party reimbursement methods and policies, including an increased focus on value-based reimbursement with downside provider risk; consolidation and pressure to integrate within the healthcare industry through acquisitions, joint ventures and managed service organizations; increased scrutiny of billing, referral, and other practices by U.S. federal and state authorities; consolidation of health insurers; competition among healthcare providers including competition for patients among healthcare providers in areas with significant unused capacity; increased expense for uninsured patients; increased expense arising from an older and sicker patient mix; increased liability insurance expenses; increased emphasis on compliance with privacy and security requirements related to health information; pressures on healthcare providers to control or reduce costs; staffing shortages (particularly nursing staff) and increases in wages as well as inflation in the cost of supplies; regulatory and government reimbursement uncertainty, increased price transparency resulting from the Transparency in Coverage rule and the Consolidated Appropriations Act of 2021, the Hospital Price Transparency regulation of 2021, the No Surprises Act and other healthcare reform laws and court decisions on cases challenging the legality of such laws; federal and state government plans to reduce budget deficits and address debt ceiling limits by lowering healthcare provider Medicaid payment rates; increased scrutiny of control over release of confidential patient medical information and increased attention to compliance with regulations designed to safeguard protected health information and cyberattacks on healthcare entities and their business associates (i.e., vendors who handle patient protected health information); and anticipated increased scrutiny and enforcement of anti-trust laws by the Federal Trade Commission and Department of Justice Antitrust Division.
The healthcare industry is currently experiencing, among other things: changes in the demand for and methods of delivering healthcare services, particularly as telemedicine and telehealth continue to gain popularity, as well as continued innovation and integration of technological advancements and artificial intelligence; a shift in the provision of healthcare services from inpatient to outpatient settings; changes in third party reimbursement methods and policies, including an increased focus on value-based reimbursement with downside provider risk; consolidation and pressure to integrate within the healthcare industry through acquisitions, joint ventures and managed service organizations; increased scrutiny of billing, referral, and other practices by U.S. federal and state authorities; consolidation of health insurers; competition among healthcare providers including competition for patients among healthcare providers in areas with significant unused capacity; increased expense for uninsured patients; increased expense arising from an older and sicker patient mix; increased liability insurance expenses; increased emphasis on compliance with privacy and security requirements related to health information; pressures on healthcare providers to control or reduce costs; staffing shortages (particularly nursing staff) and increases in wages as well as inflation in the cost of supplies; regulatory and government reimbursement uncertainty, increased price transparency resulting from the Transparency in Coverage rule and the Consolidated Appropriations Act of 2021, the Hospital Price Transparency regulation of 2021, the No Surprises Act and other healthcare reform laws and court decisions on cases challenging the legality of such laws; federal and state government plans to reduce budget deficits and address debt ceiling limits by lowering healthcare provider Medicaid payment rates (including changes to Medicaid in connection with the One Big Beautiful Bill Act, which is expected to significantly reduce Medicaid funding); increased scrutiny of control over release of confidential patient medical information and increased attention to compliance with regulations designed to safeguard protected health information and cyberattacks on healthcare entities and their business associates (i.e., vendors who handle patient protected health information); and anticipated increased scrutiny and enforcement of anti-trust laws by the Federal Trade Commission and Department of Justice Antitrust Division.
We are subject to risks related to tenant concentration, and an adverse development with respect to a large tenant could materially and adversely affect us. We had one exposure to tenant concentration that accounted for 10.0% or more of rental revenue for the year ended December 31, 2024.
We are subject to risks related to tenant concentration, and an adverse development with respect to a large tenant could materially and adversely affect us. We had one exposure to tenant concentration that accounted for 10.0% or more of rental revenue for the year ended December 31, 2025.
In addition, our business may be adversely affected by market and economic volatility due to, among other things, inflation, increased interest rates, volatility in the equity and debt markets, and economic and other conditions, including pandemics, geopolitical instability, geopolitical conflicts, terrorist attacks, sanctions, tariffs and other conditions beyond our control.
In addition, our business may be adversely affected by market and economic volatility due to, among other things, inflation, increased interest rates, volatility in the equity and debt markets, and economic and other conditions, including pandemics, government shutdowns, geopolitical instability, geopolitical conflicts, terrorist attacks, sanctions, tariffs and other conditions beyond our control.
Our investments with tenants that do not have an investment grade credit rating from a major ratings agency or were not rated and are not affiliated with companies having an investment grade credit rating may have a greater risk of default and bankruptcy than investments in properties leased exclusively to investment grade tenants.
Our investments with tenants or guarantors that do not have an investment grade credit rating from a major ratings agency, or are not rated and are not affiliated with companies having an investment grade credit rating may have a greater risk of default and bankruptcy than investments in properties leased exclusively to investment grade tenants or guarantors.
Additionally, the introduction and expansion of new stakeholders competing with traditional providers in the healthcare market and telemedicine are disrupting "agents" in the healthcare industry and could lead to decreased demand for healthcare properties and new trends in payments. The trend of increasing private equity investment in healthcare providers could also increase competition in the healthcare market.
Additionally, the introduction and expansion of new stakeholders competing with traditional providers in the healthcare market and telemedicine are disrupting “agents” in the healthcare industry and could lead to decreased demand for healthcare properties and new trends in payments. The trend of increasing private equity investment in healthcare providers could also increase competition in the healthcare market.
If we are unable to borrow monies on terms and conditions that we find acceptable, we may be forced to reduce the number of properties we can purchase and/or dispose of some of our assets. These disruptions could also adversely affect the return on the properties we purchase.
If we are unable to borrow money on terms and conditions that we find acceptable, we may be forced to reduce the number of properties we can purchase and/or dispose of some of our assets. These disruptions could also adversely affect the return on the properties we purchase.
To qualify as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders and the ownership of shares of our common stock.
To qualify as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders and the ownership of our stock.
In addition, with some exceptions, the Maryland Control Share Acquisition Act, provides that a holder of "control shares" of a Maryland corporation acquired in a control share acquisition has no voting rights, except to the extent approved by a vote of stockholders entitled to cast two-thirds of the votes entitled to be cast on the matter, excluding "control shares" owned by the acquiring person, owned by the Company's officers, and owned by the Company's employees who are also directors.
In addition, with some exceptions, the Maryland Control Share Acquisition Act, provides that a holder of “control shares” of a Maryland corporation acquired in a control share acquisition has no voting rights, except to the extent approved by a vote of stockholders entitled to cast two-thirds of the votes entitled to be cast on the matter, excluding “control shares” owned by the acquiring person, owned by the Company’s officers, and owned by the Company’s employees who are also directors.
Operating expenses associated with owning a property typically include real estate taxes, insurance, maintenance, repair and renovation costs, the cost of compliance with governmental regulation (including zoning) and the potential for liability under applicable laws.
Operating expenses associated with owning a property typically include real estate taxes, insurance, maintenance, repair and renovation costs, the cost of compliance with governmental regulations (including zoning) and the potential for liability under applicable laws.
When tenants do not renew their leases or otherwise vacate their space, it is usual that, in order to attract replacement tenants, we expend substantial funds for tenant improvements and tenant refurbishments to the vacated space.
When tenants do not renew their leases or otherwise vacate their space, it is typical that, in order to attract replacement tenants, we expend substantial funds for tenant improvements and tenant refurbishments to the vacated space.
Delays in completion of construction could also give tenants the right to terminate preconstruction leases. We may incur additional risks when we make periodic progress payments or other advances to builders before they complete construction. These and other such factors can result in increased costs of a project or loss of our investment.
Delays in completion of construction 11 Table of Contents could also give tenants the right to terminate preconstruction leases. We may incur additional risks when we make periodic progress payments or other advances to builders before they complete construction. These and other such factors can result in increased costs of a project or loss of our investment.
If a lease is rejected, it is unlikely we would receive any material payments from the tenant because our claim is capped at the rent reserved under the lease, without acceleration, for the greater of one year or 15% 9 Table of Contents of the remaining term of the lease, but not greater than three years, plus rent already due but unpaid.
If a lease is rejected, it is unlikely we would receive any material payments from the tenant because our claim is capped at the rent reserved under the lease, without acceleration, for the greater of one year or 15% of the remaining term of the lease, but not greater than three years, plus rent already due but unpaid.
If we need additional capital to improve or maintain our properties or for any other reason, we will have to obtain financing from sources such as cash flow from operations, borrowings, property sales or future equity offerings. These sources of funding may not be available 11 Table of Contents on attractive terms or at all.
If we need additional capital to improve or maintain our properties or for any other reason, we will have to obtain financing from sources such as cash flow from operations, borrowings, property sales or future equity offerings. These sources of funding may not be available on attractive terms or at all.
Failure to secure CON approval for a desired project, failure of tenant operators to maintain proper licensing, and delays in transferring properties to successor operators could negatively impact our tenants' financial conditions, and thus result in an adverse impact on our revenue, operations, and ability to make stockholder distributions.
Failure to secure CON approval for a desired project, failure of tenant operators to maintain proper licensing, and delays in transferring properties to successor operators could negatively impact our tenants’ financial conditions, and thus result in an adverse impact on our revenue, operations, and the ability to make distributions to our stockholders.
Geographic concentration of our properties exposes us to risks related to or arising from economic downturns or natural disasters and severe weather in the areas where our properties are located.
Geographic concentration of our properties exposes us to risks related to or arising from economic downturns or natural disasters, including severe weather in the areas where our properties are located.
Although a substantial portion of our tenant leases may permit us to pass through such tax increases to the tenants for payment, there is no assurance that renewal leases or future leases will be negotiated on the same basis.
Although a substantial portion of our tenant leases may permit us to pass through such tax increases to the tenants for payment, there is no assurance that renewal leases or future leases will be 10 Table of Contents negotiated on the same basis.
Insufficient reimbursement from government and private payors could negatively impact tenants' finances and rent payments, which could have an adverse effect on our revenue, operations, and ability to make stockholder distributions. 14 Table of Contents Federal, state, and local laws, statutes, regulatory policies, and any future legislative changes or rulings may impact healthcare providers leasing our properties.
Insufficient reimbursement from government and private payors could negatively impact tenants’ finances and rent payments, which could have an adverse effect on our revenue, operations, and ability to make stockholder distributions. Federal, state, and local laws, statutes, regulatory policies, and any future legislative changes or rulings may impact healthcare providers leasing our properties.
We incur borrowings, which may increase our business risks, and could hinder our ability to make distributions to our stockholders. We have obtained a credit facility and may obtain other similar financing arrangements in order to acquire properties. We may also decide to later further leverage our properties.
We incur borrowings, which may increase our business risks, and could hinder our ability to make distributions to our stockholders. We have obtained credit facilities and may obtain other similar financing arrangements in order to acquire properties. We may also decide to later further leverage our properties.
These include regulations concerning the quality and medical necessity of care, insurance and patient billing, the security and privacy of patient information, healthcare provider financial interests and conflicts of interest, self-referrals, price transparency, corporate practice of medicine and surprise billing.
These include regulations concerning the quality and medical necessity of care, 13 Table of Contents insurance and patient billing, the security and privacy of patient information, healthcare provider financial interests and conflicts of interest, self-referrals, price transparency, corporate practice of medicine and surprise billing.
Our charter, with certain exceptions, authorizes our directors to take such actions as are necessary and desirable to preserve our qualification as a REIT.
Our charter, with certain exceptions, authorizes our Board to take such actions as are necessary and desirable to preserve our qualification as a REIT.
We cannot provide assurance that any mezzanine loan in which we invest would be treated as a qualifying asset 18 Table of Contents producing qualifying income for REIT qualification purposes. If any such loan fails to be a qualifying real estate asset, we may fail either the REIT income or asset tests, and may be disqualified as a REIT.
We cannot provide assurance that any mezzanine loan in which we invest would be treated as a qualifying asset producing qualifying income for REIT qualification purposes. If any such loan fails to be a qualifying real estate asset, we may fail either the REIT income or asset tests, and may be disqualified as a REIT.
When we invest in properties where the tenant does not have a publicly available credit rating, we use certain credit assessment tools and rely on our own estimates of the tenant’s credit rating which include but are not limited to reviewing the tenant’s financial information (i.e., financial ratios, net worth, revenue, cash flows, leverage and liquidity) and monitoring local market conditions.
When we invest in properties where the tenant or guarantor do not have a publicly available credit rating, we use certain credit assessment tools and rely on our own estimates of the tenant or guarantor’s credit rating which include but are not limited to reviewing the tenant and guarantor’s financial information (i.e., financial ratios, net worth, revenue, cash flows, leverage and liquidity) and monitoring local market conditions.
Risks Related to Our Corporate Structure The limit on the number of shares a person may own may discourage a takeover that could otherwise result in a premium price to our stockholders and may hinder a stockholder's ability to dispose of his or her shares.
The limit on the number of shares a person may own may discourage a takeover that could otherwise result in a premium price to our stockholders and may hinder a stockholder’s ability to dispose of his or her shares.
A high concentration of our properties in a particular geographic area would magnify the effects of economic downturns or natural disasters, severe weather and climate change in that geographic area. There is a geographic concentration of risk subject to fluctuations in the economies of the various markets in which we own properties.
A concentration of our properties in a particular geographic area would magnify the effects of economic downturns or natural disasters, including severe weather, in that geographic area. There is a geographic concentration of risk subject to fluctuations in the economies of the various markets in which we own properties.
Many states regulate the establishment and construction of healthcare facilities and services, and the expansion of existing healthcare facilities and services through a certificate of need, or CON, laws, which may include regulation of certain licenses, medical equipment, and capital expenditures.
Many states regulate the establishment and construction of healthcare facilities and services, and the expansion of existing healthcare facilities and services through CON laws, which may include regulation of certain licenses, medical equipment, and capital expenditures.
Payment of distributions from any of the aforementioned sources could restrict our ability to generate sufficient cash flows from operations, affect our profitability and/or affect the distributions payable upon a liquidity event, any or all of which may have an adverse effect on an investment in us.
Payment of distributions from any of the aforementioned sources could restrict our ability to generate sufficient cash flows from operations, affect our profitability and/or affect the distributions payable upon a liquidity event, any or all of which may have an adverse effect on an investment in us. Item 1B. Unresolved Staff Comments. None.
For purposes of this paragraph, "unimproved real property" is real property which has not been acquired for the purpose of producing rental or other operating income, has no development or construction 12 Table of Contents in process and on which no construction or development is planned in good faith to commence within one year.
For purposes of this paragraph, “unimproved real property” is real property which has not been acquired for the purpose of producing rental or other operating income, has no development or construction in process and on which no construction or development is planned in good faith to commence within one year.
Currently, we do not have any preferred stock outstanding. The Board, without any action by our stockholders, may amend our charter from time to time to increase or decrease the aggregate number of shares or the number of shares of any class or series of stock that we have authority to issue.
The Board, without any action by our stockholders, may amend our charter from time to time to increase or decrease the aggregate number of shares or the number of shares of any class or series of stock that we have authority to issue.
For example, following the Steward bankruptcy, there was substantial negative press attention regarding certain types of corporate operators of healthcare facilities as well as actual and potential legislation, either or both of which could have negative impacts on our current and potential future tenants which could potentially have an adverse effect on our results of operations.
For example, following a bankruptcy, there has been and may in the future be substantial negative press attention regarding certain types of corporate operators of healthcare facilities as well as actual and potential legislation, either or both of which could have negative impacts on our current and potential future tenants which could potentially have an adverse effect on our results of operations.
Provisions of the Maryland General Corporation Law, or the MGCL, and of our charter and bylaws could deter takeover attempts and have an adverse impact on a stockholder’s ability to exit the investment . The MGCL, our charter, and our bylaws contain provisions that may discourage, delay or make more difficult a change in control of the Company.
Provisions of the MGCL, our charter, and our bylaws could deter takeover attempts and have an adverse impact on a stockholder’s ability to exit the investment . The Maryland General Corporation Law, or the MGCL, our charter, and our bylaws contain provisions that may delay, defer, or prevent a transaction or a change in control of the Company.
We may be required to forego otherwise attractive investments or make distributions to stockholders at disadvantageous times or when we do not have funds readily available for distribution. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.
In order to meet these tests, we may be required to forgo or liquidate otherwise attractive investments or make distributions to stockholders at disadvantageous times or when we do not have funds readily available for distribution. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.
Risks Associated with Investments in the Healthcare Property Sector Our properties and tenants may be unable to compete successfully, which could result in lower rent payments, reduce our cash flows from operations and the amount available for distributions to our stockholders.
Risks Related to our Business of Investing in the Healthcare Property Sector Our properties and tenants may be unable to compete successfully, which could result in lower rent payments, reduce our cash flows from operations and the amount available for distributions to our stockholders.
As of December 31, 2024, 8.0%, 7.3%, 5.4%, 4.2% and 4.1% of our annualized contractual base rental revenue as of December 31, 2024 was generated by properties with markets in Dallas, Oklahoma City, San Antonio, Akron, and Tucson, respectively.
As of December 31, 2025, 9.6%, 6.9%, 5.4%, 4.0% and 3.8% of our annualized December 2025 contractual base rental revenue was generated by properties with markets in Dallas, Oklahoma City, San Antonio, Akron, and Tucson, respectively.
As of December 31, 2024, 96.0% of our property portfolio was leased and leases representing 20.3% of our annualized base rent are set to expire within 5 years. We cannot assure that leases will be renewed or that our properties will be re-leased on terms equal to or better than the current terms, or at all.
As of December 31, 2025, 98.7% of our property portfolio was leased and leases representing 22.1% of our annualized base rent are set to expire within 5 years. We cannot assure stockholders that leases will be renewed or that our properties will be re-leased on terms equal to or better than the current terms, or at all.
Further, the “unsolicited takeover” provisions of Title 3, Subtitle 8 of the MGCL permit the Board, without stockholder approval and regardless of what is provided in our charter or bylaws, to implement certain takeover defenses, including adopting a classified board or increasing the vote required to remove a director.
Further, the “unsolicited takeover” provisions of Title 3, Subtitle 8 of the MGCL permit the Board, without 15 Table of Contents stockholder approval and regardless of what is provided in our charter or bylaws, to implement certain takeover defenses, including adopting a classified board, increasing the vote required to remove a director, or requiring an affirmative vote of a majority of the remaining directors to fill a vacancy.
Approximately 38.3% of our annualized contractual base rental revenue as of December 31, 2024 was derived from tenants that had either an investment grade credit rating from a major ratings agency, or had an investment grade rated guarantor or affiliate, 28.6% of our annualized contractual base rental revenue as of December 31, 2024 was derived from tenants that were rated but did not have an investment grade credit rating from a major ratings agency and 33.1% of our annualized contractual base rental revenue as of December 31, 2024 was derived from tenants that were not rated.
As of December 31, 2025, approximately 40.6% of our annualized contractual base rental revenue was derived from tenants, guarantors, or affiliates of our tenants or guarantors, that had an investment grade credit rating from a major ratings agency, approximately 26.3% of our annualized contractual base rental revenue was derived from tenants, guarantors, or affiliates, that were rated but did not have an investment grade credit rating from a major ratings agency, and 33.1% of our annualized contractual base rental revenue was derived from tenants or guarantors that were not rated.
Therefore, the value of the property to a potential purchaser may not increase over time, which may restrict our ability to sell a property, or if we are able to sell such property, may lead to a sale price less than the price that we paid to purchase the property.
Therefore, or for other reasons related to the individual properties or the markets in which they are located, the value of the property to a potential purchaser may not increase over time, which may restrict our ability to sell a property, or if we are able to sell such property, may lead to a sale price less than the price that we paid to purchase the property.
Adverse trends in healthcare provider operations may negatively affect our lease revenues and our ability to make distributions to our stockholders.
Adverse trends in healthcare provider operations, including those related to changes in laws and regulations, may negatively affect our lease revenues and our ability to make distributions to our stockholders.
Our charter permits the Board to issue stock with terms that may subordinate the rights of common stockholders or discourage a third party from acquiring us in a manner that might result in a premium price to our stockholders. Our charter permits the Board to issue up to 510,000,000 shares of common stock and 100,000,000 shares of preferred stock.
Our charter permits the Board to classify or reclassify unissued stock with terms that may subordinate the rights of common stockholders or discourage a third party from acquiring us in a manner that might result in a premium price to our stockholders.
We have previously paid, and may pay in the future, distributions from sources other than from our cash flows from operations.
Distributions paid from sources other than our cash flows from operations could reduce our available cash and the value of our Common Stock. We have previously paid, and may pay in the future, distributions from sources other than from our cash flows from operations.
We intend to structure our activities in a manner designed to satisfy all of these requirements. However, if certain of our operations were to 16 Table of Contents be recharacterized by the Internal Revenue Service, or IRS, such recharacterization could jeopardize our ability to satisfy all of the requirements for qualification as a REIT.
If certain of our operations were to be recharacterized by the Internal Revenue Service, or IRS, such recharacterization could jeopardize our ability to satisfy all of the requirements for qualification as a REIT.
The seller of a property often sells such property in its “as is” condition on a “where is” basis and “with all faults,” without any warranties of merchantability or fitness for a particular use or purpose. In addition, purchase agreements may contain only limited warranties, representations and indemnifications that will only survive for a limited period after the closing.
In addition, the seller of a property often sells such property in its “as is” condition on a “where is” basis and “with all faults,” without any warranties of merchantability or fitness for a particular use or purpose.
If we lose or are unable to obtain the services of our executive officers and other key personnel, or we are unable to establish or maintain the necessary strategic relationships, our ability to implement our business strategy could be delayed or hindered. 21 Table of Contents We may be subject to litigation that could negatively impact our future cash flow, financial condition and results of operations.
If we lose or are unable to obtain the services of our executive 14 Table of Contents officers and other key personnel, or we are unable to establish or maintain the necessary strategic relationships, our ability to operate our business or implement our business strategy could be delayed or hindered.
However, for taxable years beginning after December 31, 2017, and before January 1, 2026, U.S. stockholders that are individuals, trusts and estates generally may deduct 20% of ordinary dividends from a REIT resulting in an effective maximum U.S. federal income tax rate of 29.6% on such income.
However, U.S. stockholders that are individuals, trusts and estates generally may deduct 20% of ordinary dividends from a REIT resulting in a maximum effective U.S. federal income tax rate of 18 Table of Contents 29.6% on such income.
There is no guarantee that any processes, procedures and internal controls we have implemented, or will implement, will prevent cybersecurity threats that could adversely affect our business, financial condition, and results of operations.
We continue to face ongoing and increasing cybersecurity risks that may materially affect us in the future, and there is no guarantee that any processes, procedures, and internal controls we have implemented, or will implement, will prevent or mitigate cybersecurity incidents that could adversely affect our business, financial condition, and results of operations.
Competition for persons with managerial and operational skills is intense, and we cannot assure our stockholders that we will be successful in retaining or attracting skilled personnel.
We believe that our future success depends, in large part, on our ability to retain and hire highly-skilled managerial and operating personnel. Competition for persons with managerial and operational skills is intense, and we cannot assure our stockholders that we will be successful in retaining or attracting skilled personnel.
The maximum U.S. federal income tax rate for “qualified dividends” payable to U.S. stockholders that are individuals, trusts and estates generally is 20%. Dividends payable by REITs, however, are generally not eligible for the reduced rates for qualified dividends and are taxed at ordinary income rates.
Dividends payable by REITs generally do not qualify for the preferential tax rates available for some dividends under current law. The maximum U.S. federal income tax rate for “qualified dividends” payable to U.S. stockholders that are individuals, trusts and estates generally is 20%.
For additional information, see the risk factor above titled “ The limit on the number of shares a person may own may discourage a takeover that could otherwise result in a premium price to our stockholders and may hinder a stockholder's ability to dispose of his or her shares.” ERISA Risks If our assets are deemed to be ERISA plan assets, we may be exposed to liabilities under Title I of ERISA and the Internal Revenue Code.
For additional information, see the risk factor above titled “ The limit on the number of shares a person may own may discourage a takeover that could otherwise result in a premium price to our stockholders and may hinder a stockholder’s ability to dispose of his or her shares.” Risks Related to our Common Stock The market price and trading volume of shares of our Common Stock may be volatile.
We also may be subject to state and local taxes on our income or property, either directly or indirectly through our Operating Partnership or other companies through which we indirectly own assets.
We also may be subject to state and local taxes on our income or property, either directly or indirectly through our Operating Partnership or other companies through which we indirectly own assets. Additionally, some of our assets may need to be owned by, or operations may need to be conducted through, one or more taxable REIT subsidiaries, or TRS.
Federal Income Tax Risks Failure to maintain our qualification as a REIT would adversely affect our operations and ability to make distributions. In order for us to maintain our qualification as a REIT, we must satisfy certain requirements set forth in the Code and Treasury Regulations and various factual matters and circumstances that are not entirely within our control.
Federal Income Tax Risks Failure to maintain our qualification as a REIT would adversely affect our operations and ability to make distributions. In order for us to maintain our qualification as a REIT, we must satisfy certain asset, income, organizational, distribution, stockholder ownership and other requirements set forth in the Code and Treasury Regulations on an ongoing basis.
Increases not passed through to tenants will adversely affect our income, cash available for distributions, and the amount of distributions to our stockholders. Covenants, conditions and restrictions may restrict our ability to operate our properties. Some of our properties may be contiguous to other parcels of real property, comprising part of the same commercial center.
Covenants, conditions and restrictions may restrict our ability to operate our properties. Some of our properties may be contiguous to other parcels of real property, comprising part of the same commercial center.
The after-tax net income of our TRS would be available for distribution to us. Further, we would incur a 100% excise tax on transactions with our TRS that are not conducted on an arm’s-length basis.
Any of our TRS would be subject to U.S. federal, state and local income tax on its taxable income at applicable corporate rates, reducing the amount available for distribution to us. Further, we would incur a 100% excise tax on transactions with our TRS that are not conducted on an arm’s-length basis.
If debt financing is not available on terms and conditions we find acceptable, we may not be able to obtain financing for investments. These disruptions in the credit markets have not thus far affected our ability to borrow monies to finance the purchase of, or other activities related to, real estate assets, but they may do so in the future.
These disruptions in the credit markets have not thus far affected our ability to borrow money to finance the purchase of, or other activities related to, real estate assets, but they may do so in the future.
In addition, failure to effectively hedge against interest rate changes may adversely affect our results of operations. We have broad authority to incur debt, and high debt levels could hinder our ability to make distributions and could decrease the value of our stockholders’ investments.
We have broad authority to incur debt, and high debt levels could hinder our ability to make distributions and could decrease the value of our stockholders’ investments.
Because of these and other reasons, our stockholders may experience substantial dilution in their percentage ownership of our shares. 8 Table of Contents We may be unable to maintain cash distributions or increase distributions over time. There are many factors that can affect the availability and timing of cash distributions to stockholders.
We may be unable to maintain cash distributions or increase distributions over time. There are many factors that can affect the availability and timing of cash distributions to stockholders.
These arrangements involve risk, such as the risk that counterparties may fail to honor their obligations under these arrangements, and that these arrangements will not be effective in reducing our exposure to interest rate changes. In addition, interest rates may change in an unexpected manner and therefore significantly reduce the economic benefits of such arrangements.
We manage exposure to interest rate volatility by using interest rate hedging arrangements. These arrangements involve risk, such as the risk that counterparties may fail to honor their obligations under these arrangements, and that these arrangements will not be effective in reducing our exposure to interest rate changes.
In addition, a tenant may refuse or be unable to pay for any required maintenance for a property or its premises, which may result in us needing to cover such costs. While our leases generally provide for protection in these instances, a tenant may defer maintenance and it may be difficult to enforce remedies against such a tenant.
While our leases generally provide for protection in these instances, a tenant may defer maintenance and it may be difficult to enforce remedies against such a tenant.
To the extent we are unable to pass along our property operating expenses to our tenants, our business, financial condition and results of operations may be negatively impacted.
If one of our tenants experiences such a loss, it may be unable to satisfy its payment obligations to us under its lease with us. To the extent we are unable to pass along our property operating expenses and taxes to our tenants, our business, financial condition and results of operations may be negatively impacted.
Our tenants’ businesses are generally influenced by government and private payor rates. Reimbursement from Medicare, Medicaid, and other governmental payors may be subject to statutory changes, recovery of overpayments, rate adjustments, administrative decision-making, funding restrictions, and payment delays due to investigations or audits.
Such efforts by Medicare and Medicaid to reduce reimbursements could negatively affect our tenant’s revenues and their ability to pay rent to us. Reimbursement from Medicare, Medicaid, and other governmental payors may be subject to statutory changes, recovery of overpayments, rate adjustments, administrative decision-making, funding restrictions, and payment delays due to investigations or audits.
If a property is not adequately maintained in accordance with the terms of the applicable lease, we may incur expenses for deferred maintenance or other liabilities, including upon expiration or earlier termination of a lease. We generally visit our properties on a periodic basis, but deferred maintenance items may go unnoticed.
Our leases generally provide that tenants are responsible for some or all of the maintenance and other day-to-day management of the relevant properties or their premises; however if a property is not adequately maintained in accordance with the terms of the applicable lease, we may incur expenses for deferred maintenance or other liabilities, including upon expiration or earlier termination of a lease.
The leases with tenants under common control of Post Acute Medical LLC accounted for 14.9% of rental revenue for the year ended December 31, 2024.
The leases with tenants under common control of PAM Health accounted for 16.1% of rental revenue for the year ended December 31, 2025.
Such an event could cause a decrease or cessation of rental payments that would mean a reduction in our cash flow and the amount available for distributions to our stockholders. In the event of a bankruptcy, we cannot give assurance that the tenant or its trustee will assume our lease.
A tenant or lease guarantor bankruptcy could delay efforts to collect past due balances under the relevant leases, and could ultimately preclude full collection of these sums. Such an event could cause a decrease or cessation of rental payments that would mean a reduction in our cash flow and the amount available for distributions to our stockholders.
Our desire to avoid the prohibited transactions tax may cause us to forego disposition opportunities that would otherwise be advantageous if we were not a REIT. In certain circumstances, we may be subject to U.S. federal, state and local income taxes as a REIT, which would reduce our cash available for distribution to our stockholders.
Our desire to avoid the prohibited transactions tax may cause us to forego disposition opportunities that would otherwise be advantageous if we were not a REIT.
General Risks Related to Investments in Real Estate Our operating results may be affected by political, economic and regulatory changes that have an adverse impact on the global economy or the real estate market in general, which may prevent us from being profitable or from realizing growth in the value of our real estate properties.
Risks Related to Our Business of Investing in Real Estate We are subject to political, economic and regulatory changes that may have an adverse impact on the global economy or the real estate market in general.
From time to time our property taxes may increase as property values or assessment rates change or for other reasons deemed relevant by the assessors. An increase in the assessed valuation of a property for real estate tax purposes will result in an increase in the related real estate taxes on that property.
Some local real property tax assessors may seek to reassess certain properties following our acquisition of them. In addition, from time to time our property taxes may increase as property values or assessment rates change or for other reasons deemed relevant by the assessors.
In addition, climate change may adversely impact our properties directly and may lead to additional compliance obligations and costs, including insurance premiums, taxes and fees.
In addition, climate change may adversely impact our properties directly and may lead to additional compliance obligations and costs, including insurance premiums, taxes and fees. We have tenants with below investment grade credit ratings and non-rated tenants that may expose us to a greater risk of default.
If a given lease, or guaranty of a lease, is not assumed, our cash flow and the amounts available for distributions to our stockholders may be adversely affected. Sponsors and owners of tenants at certain of our properties have previously declared bankruptcy.
In the event of a bankruptcy, we cannot give assurance that the tenant or its trustee will assume our lease. If a given lease, or guaranty 8 Table of Contents of a lease, is not assumed, our cash flow and the amounts available for distributions to our stockholders may be adversely affected.
We also may decide to retain net capital gain we earn from the sale or other disposition of our property and pay income tax directly on such income. In that event, our stockholders would be treated as if they earned that income and paid the tax on it directly.
For example, we may be subject to the prohibited transactions tax and/or the excise tax for failing to make (or be deemed to have made) sufficient distributions, as described above. We also may decide to retain net capital gain we earn from the sale or other disposition of our property and pay income tax directly on such income.
A number of additional factors could negatively affect the price of our Common Stock or result in fluctuations in the price or trading volume of our Common Stock.
Our Common Stock is listed on the NYSE. A number of factors could negatively affect the price of our Common Stock or result in fluctuations in the price or trading volume of our Common Stock. We cannot assure our stockholders that the market price of our Common Stock will not fluctuate or decline significantly in the future.
Our stockholders’ interest in us will be diluted if we issue additional shares. Existing stockholders do not have preemptive rights to any shares issued by us in the future. Our charter authorizes 610,000,000 shares of stock, of which 510,000,000 shares are classified as common stock and 100,000,000 are classified as preferred stock.
Our charter authorizes 610,000,000 shares of stock, of which 510,000,000 shares are classified as Common Stock and 100,000,000 are classified as preferred stock. Currently, we do not have any preferred stock outstanding.
As a result, we may have no recourse or limited recourse against the prior owners with respect to unknown liabilities. The purchase of properties with limited warranties increases the risk that we may lose some or all of our invested capital in the property as well as the loss of rental income from that property.
The purchase of properties with limited warranties increases the risk that we may lose some or all of our invested capital in the property as well as the loss of rental income from that property. The Company’s real estate investments are illiquid and the Company may not be able to sell properties strategically targeted for disposition.
If any purchaser defaults under a financing arrangement with us, it could negatively impact our ability to pay cash distributions to our stockholders. Our investments in, and acquisitions of, real property may be unsuccessful or fail to meet our expectations and we may not be successful in identifying attractive acquisition opportunities and consummating these transactions.
Increases not passed through to tenants will adversely affect our income, cash available for distributions, and the amount of distributions to our stockholders. Our investments in, and acquisitions of, real property may be unsuccessful or fail to meet our expectations and we may not be successful in identifying attractive acquisition opportunities and consummating these transactions.
If our Operating Partnership fails to maintain its status as a partnership, its income may be subject to taxation, which would reduce the cash available for distribution to our stockholders. We intend to maintain the status of our Operating Partnership as a partnership for U.S. federal income tax purposes.
Even if we qualify as a REIT, we may face other tax liabilities that would reduce our cash available for distribution to our stockholders. Even if we qualify for taxation as a REIT, we may be subject to U.S. federal, state and local income taxes.
If vacancies continue for an extended period of time, we may suffer reduced revenues, resulting in less cash to be distributed to stockholders. In addition, because properties’ market values depend principally upon the value of the properties’ leases, the resale value of properties with prolonged vacancies could suffer, which could further reduce our stockholders’ return.
In addition, because properties’ market values depend principally upon the value of the properties’ leases, the resale value of properties with prolonged vacancies could suffer, which could further reduce our stockholders’ return. 9 Table of Contents We may be unable to secure funds for future tenant improvements or capital needs, and we may not control the maintenance of our net leased properties, which could adversely impact our ability to pay cash distributions to our stockholders.
There can be no assurance that our hedging arrangements will qualify for hedge accounting or that our hedging activities will have the desired beneficial impact on our results of operations. Should we terminate a hedging agreement, it may result in significant costs and cash requirements to fulfil our obligations under the hedging arrangement.
In addition, interest rates may change in an unexpected manner and therefore significantly reduce the economic benefits of such arrangements. There can be no assurance that our hedging arrangements will qualify for hedge accounting or that our hedging activities will have the desired beneficial impact on our results of operations.
We encourage our stockholders to consult their own tax advisor to determine the tax consequences applicable to them if they are a foreign investor. REIT ownership limitations may restrict or prevent you from engaging in certain transfers of our common stock.
REIT ownership limitations may restrict or prevent you from engaging in certain transfers of our Common Stock.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

9 edited+4 added−4 removed3 unchanged
Biggest changeIn addition, we have an established schedule and process for regular phishing awareness campaigns that are designed to emulate real-world contemporary threats and provide immediate feedback (and, if necessary, additional training or remedial action) to employees; • Annually assess the Cybersecurity Program against the NIST Framework; • Maintaining business continuity, contingency and recovery plans to quickly react to cybersecurity incidents; • Conducting security assessments of all third-party service providers with access to personal, confidential or proprietary information before engagement and maintaining ongoing monitoring by reviewing system and organization controls reports, relevant cyber attestations, and other independent cyber ratings; • Retaining a third-party cybersecurity provider for emergency incident response services in the event of a serious information security breach; and • Maintaining cybersecurity risk insurance that could help defray the costs of an information security breach as a backstop to the Cybersecurity Program.
Biggest changeOur Cybersecurity Program includes the following processes: • Conducting annual control reviews, annual policy reviews and annual investments in our security infrastructure; • Periodically testing our information systems to assess our vulnerability to cyber risk, including targeted penetration testing and vulnerability scanning; • Collaborating with our internal audit team to evaluate the effectiveness of our Cybersecurity Program and communicating results to our executive officers; • Providing mandatory cybersecurity training to all employees, including regular phishing awareness campaigns and regular security awareness trainings; 21 Table of Contents • Leveraging the NIST Framework for an annual assessment of the Cybersecurity Program; • Maintaining business continuity, contingency and recovery plans to promptly respond to and recover from cybersecurity incidents; • Conducting security assessments of third-party service providers with access to personal, confidential or proprietary information before engagement and engaging in ongoing monitoring of such providers; • Implementing processes to confirm that agreements with third parties contain data security and privacy terms as appropriate; • Retaining a third-party cybersecurity provider for incident response services for certain cybersecurity incidents and conducting a table top response exercise with the third-party cybersecurity provider and certain company personnel at lease annually; and • Maintaining cybersecurity risk insurance that could help defray the costs of a cybersecurity incident.
See “Risk Factors – General Risk Factors - Cybersecurity risks and cyber incidents may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our business relationships, all of which could negatively impact our financial results” in Part I, Item 1A of this Annual Report on Form 10-K for a discussion of these risks.
See “Risk Factors – General Risk Factors – Cybersecurity risks and incidents may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our business relationships, all of which could negatively impact our financial results” in Part I, Item 1A of this Annual Report on Form 10-K for a discussion of these risks.
Led by our Vice President of Information Technology & Corporate Facilities, our Cybersecurity Management Team is responsible for the management of the Cybersecurity Program and for the day-to-day investigation of and response to potential information security-related incidents.
Led by our Vice President of Information Technology & Corporate Facilities, our Cybersecurity Management Team is responsible for the management of the Cybersecurity Program and for the day-to-day investigation of and response to potential cybersecurity incidents.
The goals of the incident response plan are to prevent, detect and react to information security incidents, determine their scope and risk, respond appropriately to the incident, communicate the results and risk to relevant stakeholders, and reduce the likelihood of the incident from reoccurring. Our Vice President of Information Technology & Corporate Facilities has served in this role since 2018.
The goals of the incident response plan are to prevent, detect and contain cybersecurity incidents, determine their scope and risk, respond appropriately to the incident, communicate the results and risk to relevant stakeholders, and reduce the likelihood of the incident reoccurring. Our Vice President of Information Technology & Corporate Facilities has served in this role since 2018.
Item 1C. Cybersecurity. We have developed, implemented, and integrated a cybersecurity program, or the Cybersecurity Program, into our broader risk management structure to protect our information systems by using physical, technical, and administrative safeguards. This includes assessing, identifying, monitoring, reporting, managing and remediating cybersecurity threats.
Item 1C. Cybersecurity. We have developed, implemented, and integrated a cybersecurity program, or the Cybersecurity Program, into our broader risk management structure to protect our information systems by using physical, technical, and administrative safeguards. This includes measures designed to assess, identify, monitor, report, and remediate cybersecurity threats.
As part of the incident response plan discussed above, in the event we experience a cybersecurity incident that could materially affect us, including our business strategy, results of operations or financial condition, our executive officers (who are also a part of the Cybersecurity Management Team) will review the incident with the Audit Committee to consider whether and to what extent disclosure is required under Item 1.05 of Form 8-K.
As part of the incident response plan discussed above, in the event we experience a cybersecurity incident that could materially affect us, including our business strategy, results of operations, or financial condition, our executive officers (who are also a part of the Cybersecurity Management Team) will review the cybersecurity incident with the Audit Committee and full Board as appropriate.
The Cybersecurity Program aims to prevent data ex-filtration, manipulation, and destruction, as well as system and transactional disruption. The Cybersecurity Program utilizes a threat-centric and risk-based approach to identify and assess cybersecurity threats that could affect our business and information systems based on the National Institute of Standards and Technology Cybersecurity Framework, or the NIST Framework.
The Cybersecurity Program utilizes a threat-centric and risk-based approach to identify and assess cybersecurity threats that could affect our business and information systems based on industry frameworks such as the National Institute of Standards and Technology Cybersecurity Framework, or the NIST Framework.
Our Vice President of Information Technology & Corporate Facilities possesses extensive experience in technology and cybersecurity gained over his career spanning more than 25 years, including service as the executive director of Business Applications as well as a senior implementer and business consultant. 22 Table of Contents The Board plays a role in overseeing risks associated with cybersecurity threats and has delegated to the Audit Committee primary oversight of the Cybersecurity Program.
Our Vice President of Information Technology & Corporate Facilities possesses extensive experience in technology and cybersecurity gained over his career spanning more than 25 years, including service as the Executive Director of Business Applications as well as a senior implementer and business consultant.
Our executive officers report on our Cybersecurity Program to the Audit Committee at least four times per year (including as part of our discussions regarding enterprise risk management). Our quarterly updates to the Audit Committee include a discussion of our information security programs and controls, including our internal auditor's review and our internal monitoring of cybersecurity risks.
Our executive officers report on our Cybersecurity Program to the Audit Committee at least four times per year (including as part of our discussions regarding enterprise risk management) and provide updates to the full Board regarding these topics as appropriate.
Removed
Our Cybersecurity Program includes the following processes: • Annual control reviews, annual policy reviews and annual investments in our security infrastructure; • Periodic testing of our information systems to assess our vulnerability to cyber risk, which includes targeted penetration testing and vulnerability scanning; • Collaborating with our internal audit team to evaluate the effectiveness of our information technology security program and communicating results to our executive officers; • Conducting a comprehensive information security and training program for our employees, including mandatory computer-based training, regular internal communications, and ongoing end-user testing to measure the effectiveness of our information security program.
Added
The Cybersecurity Program aims to prevent unauthorized data exfiltration, manipulation, and destruction, as well as system and transactional disruption.
Removed
As part of this commitment, we require our employees to acknowledge our Information Security policy each year.
Added
The Board plays a role in overseeing risks associated with cybersecurity threats and has delegated to the Audit Committee primary oversight of the Cybersecurity Program.
Removed
Pursuant to our incident response plan, incidents meeting specified severity levels are required to be escalated to the Cybersecurity Management Team for review and response.
Added
Our quarterly updates to the Audit Committee include a discussion of our Cybersecurity Program measures and controls, including our internal auditor’s review and our internal monitoring of cybersecurity risks.
Removed
To date, we have not experienced a material cybersecurity incident.
Added
As of December 31, 2025 we have not had any known instances of material cybersecurity incidents, including third-party incidents, during any of the prior three fiscal years.

Item 2. Properties

Properties — owned and leased real estate

10 edited+1 added−0 removed3 unchanged
Biggest changePetersburg-Clearwater, FL 07/20/2022 2022 100% 87,649 (1) Escondido Healthcare Facility San Diego-Carlsbad, CA 07/21/2022 2021 100% 56,800 (1) West Palm Beach Healthcare Facility Miami-Fort Lauderdale-West Palm Beach, FL 06/15/2023 1999 100% 25,150 (1) Burr Ridge Healthcare Facility Chicago-Naperville-Elgin, IL-IN 09/27/2023 2010 100% 104,912 (1) Brownsburg Healthcare Facility Indianapolis-Carmel-Greenwood, IN 02/26/2024 2023 100% 55,986 (1) Cave Creek Healthcare Facility Phoenix-Mesa-Chandler, AZ 03/20/2024 2021 100% 32,450 — Marana Healthcare Facility Tucson, AZ 03/20/2024 2020 100% 32,250 — Surprise Healthcare Facility Phoenix-Mesa-Chandler, AZ 03/20/2024 2020 100% 32,450 — Tucson Healthcare Facility V Tucson, AZ 03/20/2024 2020 100% 32,450 — Weslaco Healthcare Facility McAllen-Edinburg-Mission, TX 03/20/2024 2019 100% 28,750 — Reading Healthcare Facility Reading, PA 05/21/2024 2020 100% 30,000 — Fort Smith Healthcare Facility Fort Smith, AR-OK 07/25/2024 2021 100% 62,570 — 5,049,548 — (1) Property is contributed to the pool of unencumbered properties of our credit facility.
Biggest changePetersburg-Clearwater, FL 07/20/2022 2022 100% 87,649 (1) Escondido Healthcare Facility San Diego-Carlsbad, CA 07/21/2022 2021 100% 56,800 (1) West Palm Beach Healthcare Facility Miami-Fort Lauderdale-West Palm Beach, FL 06/15/2023 1999 100% 25,150 (1) Burr Ridge Healthcare Facility Chicago-Naperville-Elgin, IL-IN 09/27/2023 2010 100% 104,912 (1) Brownsburg Healthcare Facility Indianapolis-Carmel-Greenwood, IN 02/26/2024 2023 100% 55,986 (1) Cave Creek Healthcare Facility Phoenix-Mesa-Chandler, AZ 03/20/2024 2021 100% 32,450 (1) Marana Healthcare Facility Tucson, AZ 03/20/2024 2020 100% 32,250 (1) Surprise Healthcare Facility Phoenix-Mesa-Chandler, AZ 03/20/2024 2020 100% 32,450 (1) Tucson Healthcare Facility V Tucson, AZ 03/20/2024 2020 100% 32,450 (1) Weslaco Healthcare Facility McAllen-Edinburg-Mission, TX 03/20/2024 2019 100% 28,750 (1) Reading Healthcare Facility Reading, PA 05/21/2024 2020 100% 30,000 (1) Fort Smith Healthcare Facility Fort Smith, AR-OK 07/25/2024 2021 100% 62,570 (1) Knoxville Healthcare Facility Knoxville, TN 03/04/2025 2021 100% 70,005 — Dover Healthcare Facility Dover, DE 04/16/2025 2018 100% 42,140 — Southlake Healthcare Facility Dallas-Fort Worth-Arlington, TX 08/01/2025 2011 100% 16,745 — Southlake Healthcare Facility II Dallas-Fort Worth-Arlington, TX 08/01/2025 2017 100% 11,048 — Peoria Healthcare Facility Phoenix-Mesa-Chandler, AZ 09/05/2025 2022 100% 49,084 — Plano Healthcare Facility Dallas-Fort Worth-Arlington, TX 09/05/2025 2023 100% 51,815 — 5,255,473 — (1) Property is contributed to the pool of unencumbered properties of our unsecured credit facilities.
Louis, MO-IL 10/04/2019 2012 100% 66,914 (1) Covington Healthcare Facility New Orleans-Metairie, LA 10/04/2019 1984 100% 43,250 (1) Crestview Healthcare Facility Crestview-Fort Walton Beach-Destin, FL 10/04/2019 2004 100% 5,685 — Dallas Healthcare Facility Dallas-Fort Worth-Arlington, TX 10/04/2019 2011 100% 62,390 (1) De Pere Healthcare Facility Green Bay, WI 10/04/2019 2005 100% 7,100 (1) Denver Healthcare Facility Denver-Aurora-Centennial, CO 10/04/2019 1962 100% 131,210 (1) El Segundo Healthcare Facility Los Angeles-Long Beach-Anaheim, CA 10/04/2019 2009 100% 12,163 — Fairlea Healthcare Facility Hagerstown-Martinsburg, MD-WV 10/04/2019 1999 100% 5,200 — Fayetteville Healthcare Facility Fayetteville-Springdale-Rogers, AR 10/04/2019 1994 100% 55,740 (1) Fort Walton Beach Healthcare Facility Crestview-Fort Walton Beach-Destin, FL 10/04/2019 2005 100% 9,017 — Frankfort Healthcare Facility Lexington-Fayette, KY 10/04/2019 1993 100% 4,000 — Frisco Healthcare Facility Dallas-Fort Worth-Arlington, TX 10/04/2019 2010 100% 57,051 (1) Goshen Healthcare Facility Elkhart-Goshen, IN 10/04/2019 2010 100% 15,462 (1) Hammond Healthcare Facility Hammond, LA 10/04/2019 2006 100% 63,000 (1) Hammond Healthcare Facility II Hammond, LA 10/04/2019 2004 100% 23,835 (1) Henderson Healthcare Facility Las Vegas-Henderson-North Las Vegas, NV 10/04/2019 2000 100% 6,685 — Houston Healthcare Facility III Houston-Pasadena-The Woodlands, TX 10/04/2019 1998 100% 16,217 (1) Howard Healthcare Facility Green Bay, WI 10/04/2019 2011 100% 7,552 (1) Jacksonville Healthcare Facility Jacksonville, FL 10/04/2019 2009 100% 13,082 — Lafayette Healthcare Facility Lafayette, LA 10/04/2019 2004 100% 73,824 (1) Lakewood Ranch Healthcare Facility North Port-Bradenton-Sarasota, FL 10/04/2019 2008 100% 10,919 — Las Vegas Healthcare Facility II Las Vegas-Henderson-North Las Vegas, NV 10/04/2019 2007 100% 6,963 — Lehigh Acres Healthcare Facility Cape Coral-Fort Myers, FL 10/04/2019 2002 100% 5,746 — Lubbock Healthcare Facility Lubbock, TX 10/04/2019 2003 100% 102,143 (1) Manitowoc Healthcare Facility Green Bay, WI 10/04/2019 2003 100% 7,987 (1) Manitowoc Healthcare Facility II Green Bay, WI 10/04/2019 1964 100% 36,090 (1) Marinette Healthcare Facility Green Bay, WI 10/04/2019 2008 100% 4,178 (1) New Braunfels Healthcare Facility San Antonio-New Braunfels, TX 10/04/2019 2007 100% 27,971 (1) North Smithfield Healthcare Facility Providence-Warwick, RI-MA 10/04/2019 1965 100% 92,944 (1) Oklahoma City Healthcare Facility IX Oklahoma City, OK 10/04/2019 2007 100% 34,970 (1) Oshkosh Healthcare Facility Oshkosh-Neenah, WI 10/04/2019 2010 100% 8,717 (1) Palm Desert Healthcare Facility Riverside-San Bernardino-Ontario, CA 10/04/2019 2005 100% 6,963 — Rancho Mirage Healthcare Facility II Riverside-San Bernardino-Ontario, CA 10/04/2019 2008 100% 7,432 — San Antonio Healthcare Facility III San Antonio-New Braunfels, TX 10/04/2019 2012 100% 50,000 (1) San Antonio Healthcare Facility IV San Antonio-New Braunfels, TX 10/04/2019 1987 100% 113,136 (1) San Antonio Healthcare Facility V San Antonio-New Braunfels, TX 10/04/2019 2017 81% 47,091 (1) Santa Rosa Beach Healthcare Facility Crestview-Fort Walton Beach-Destin, FL 10/04/2019 2003 100% 5,000 — Savannah Healthcare Facility Savannah, GA 10/04/2019 2014 100% 48,184 — Sturgeon Bay Healthcare Facility Green Bay, WI 10/04/2019 2007 100% 3,100 (1) Victoria Healthcare Facility Victoria, TX 10/04/2019 2013 100% 34,297 (1) Victoria Healthcare Facility II Victoria, TX 10/04/2019 1998 100% 28,752 (1) Wilkes-Barre Healthcare Facility Scranton–Wilkes-Barre, PA 10/04/2019 2012 100% 15,996 (1) Tucson Healthcare Facility II Tucson, AZ 12/26/2019 2021 100% 60,913 (1) Tucson Healthcare Facility III Tucson, AZ 12/27/2019 2020 100% 20,000 (1) Grimes Healthcare Facility Des Moines-West Des Moines, IA 02/19/2020 2018 100% 14,669 (1) 25 Table of Contents Property Name MSA/µSA Date Acquired Year Constructed % Leased Leased Sq Ft Encumbrances, $ (in thousands) Tampa Healthcare Facility Tampa-St.
Louis, MO-IL 10/04/2019 2012 100% 66,914 (1) Covington Healthcare Facility New Orleans-Metairie, LA 10/04/2019 1984 100% 43,250 (1) Crestview Healthcare Facility Crestview-Fort Walton Beach-Destin, FL 10/04/2019 2004 100% 5,685 — Dallas Healthcare Facility Dallas-Fort Worth-Arlington, TX 10/04/2019 2011 100% 62,390 (1) De Pere Healthcare Facility Green Bay, WI 10/04/2019 2005 100% 7,100 (1) Denver Healthcare Facility Denver-Aurora-Centennial, CO 10/04/2019 1962 100% 131,210 (1) El Segundo Healthcare Facility Los Angeles-Long Beach-Anaheim, CA 10/04/2019 2009 100% 12,163 — Fairlea Healthcare Facility Hagerstown-Martinsburg, MD-WV 10/04/2019 1999 100% 5,200 — Fayetteville Healthcare Facility Fayetteville-Springdale-Rogers, AR 10/04/2019 1994 100% 55,740 (1) Fort Walton Beach Healthcare Facility Crestview-Fort Walton Beach-Destin, FL 10/04/2019 2005 100% 9,017 — Frankfort Healthcare Facility Lexington-Fayette, KY 10/04/2019 1993 100% 4,000 — Frisco Healthcare Facility Dallas-Fort Worth-Arlington, TX 10/04/2019 2010 100% 57,051 (1) Goshen Healthcare Facility Elkhart-Goshen, IN 10/04/2019 2010 100% 15,462 (1) Hammond Healthcare Facility Hammond, LA 10/04/2019 2006 100% 63,000 (1) Hammond Healthcare Facility II Hammond, LA 10/04/2019 2004 100% 23,835 (1) Henderson Healthcare Facility Las Vegas-Henderson-North Las Vegas, NV 10/04/2019 2000 100% 6,685 — Houston Healthcare Facility III Houston-Pasadena-The Woodlands, TX 10/04/2019 1998 100% 16,217 (1) Howard Healthcare Facility Green Bay, WI 10/04/2019 2011 100% 7,552 (1) Jacksonville Healthcare Facility Jacksonville, FL 10/04/2019 2009 100% 13,082 — Lafayette Healthcare Facility Lafayette, LA 10/04/2019 2004 100% 73,824 (1) Lakewood Ranch Healthcare Facility North Port-Bradenton-Sarasota, FL 10/04/2019 2008 100% 10,919 — Las Vegas Healthcare Facility II Las Vegas-Henderson-North Las Vegas, NV 10/04/2019 2007 100% 6,963 — Lehigh Acres Healthcare Facility Cape Coral-Fort Myers, FL 10/04/2019 2002 100% 5,746 — Lubbock Healthcare Facility Lubbock, TX 10/04/2019 2003 100% 102,143 (1) Manitowoc Healthcare Facility Green Bay, WI 10/04/2019 2003 100% 7,987 (1) Manitowoc Healthcare Facility II Green Bay, WI 10/04/2019 1964 100% 36,090 (1) Marinette Healthcare Facility Green Bay, WI 10/04/2019 2008 100% 4,178 (1) New Braunfels Healthcare Facility San Antonio-New Braunfels, TX 10/04/2019 2007 100% 27,971 (1) North Smithfield Healthcare Facility Providence-Warwick, RI-MA 10/04/2019 1965 100% 92,944 (1) Oklahoma City Healthcare Facility IX Oklahoma City, OK 10/04/2019 2007 100% 34,970 (1) Oshkosh Healthcare Facility Oshkosh-Neenah, WI 10/04/2019 2010 100% 8,717 (1) Palm Desert Healthcare Facility Riverside-San Bernardino-Ontario, CA 10/04/2019 2005 —% — — Rancho Mirage Healthcare Facility II Riverside-San Bernardino-Ontario, CA 10/04/2019 2008 100% 7,432 — San Antonio Healthcare Facility III San Antonio-New Braunfels, TX 10/04/2019 2012 100% 50,000 (1) San Antonio Healthcare Facility IV San Antonio-New Braunfels, TX 10/04/2019 1987 100% 113,136 (1) San Antonio Healthcare Facility V San Antonio-New Braunfels, TX 10/04/2019 2017 81% 47,091 (1) Santa Rosa Beach Healthcare Facility Crestview-Fort Walton Beach-Destin, FL 10/04/2019 2003 100% 5,000 — Savannah Healthcare Facility Savannah, GA 10/04/2019 2014 100% 48,184 — Sturgeon Bay Healthcare Facility Green Bay, WI 10/04/2019 2007 100% 3,100 (1) Victoria Healthcare Facility Victoria, TX 10/04/2019 2013 100% 34,297 (1) Victoria Healthcare Facility II Victoria, TX 10/04/2019 1998 100% 28,752 (1) Wilkes-Barre Healthcare Facility Scranton–Wilkes-Barre, PA 10/04/2019 2012 100% 15,996 (1) Tucson Healthcare Facility II Tucson, AZ 12/26/2019 2021 100% 60,913 (1) Tucson Healthcare Facility III Tucson, AZ 12/27/2019 2020 100% 20,000 (1) Grimes Healthcare Facility Des Moines-West Des Moines, IA 02/19/2020 2018 100% 14,669 (1) 24 Table of Contents Property Name MSA/µSA Date Acquired Year Constructed % Leased Leased Sq Ft Encumbrances, $ (in thousands) Tampa Healthcare Facility Tampa-St.
We own fee simple interests in all of our land, buildings and improvements except for 19 properties, for which we own leasehold interests subject to the respective ground leases. 23 Table of Contents Property Statistics The following table shows the property statistics of our real estate portfolio as of December 31, 2024: Property Name MSA/µSA Date Acquired Year Constructed % Leased Leased Sq Ft Encumbrances, $ (in thousands) Houston Healthcare Facility Houston-Pasadena-The Woodlands, TX 07/31/2014 1993 100% 13,645 (1) Cincinnati Healthcare Facility Cincinnati, OH-KY-IN 10/29/2014 2001 100% 14,868 (1) Winston-Salem Healthcare Facility Winston-Salem, NC 12/17/2014 2004 100% 22,200 (1) Stoughton Healthcare Facility Boston-Cambridge-Newton, MA-NH 12/23/2014 1973 —% — — Fort Worth Healthcare Facility Dallas-Fort Worth-Arlington, TX 12/31/2014 2014 100% 83,464 (1) Fort Worth Healthcare Facility II Dallas-Fort Worth-Arlington, TX 12/31/2014 2014 100% 8,268 (1) Winter Haven Healthcare Facility Lakeland-Winter Haven, FL 01/27/2015 2009 100% 7,560 (1) Overland Park Healthcare Facility Kansas City, MO-KS 02/17/2015 2014 100% 54,568 (1) Clarion Healthcare Facility Pittsburgh, PA 06/01/2015 2012 100% 33,000 (1) Webster Healthcare Facility Houston-Pasadena-The Woodlands, TX 06/05/2015 2015 100% 53,514 (1) Augusta Healthcare Facility Augusta-Waterville, ME (µSA) 07/22/2015 2010 100% 51,000 (1) Cincinnati Healthcare Facility III Cincinnati, OH-KY-IN 07/22/2015 2014 100% 41,600 (1) Florence Healthcare Facility Cincinnati, OH-KY-IN 07/22/2015 2014 100% 41,600 (1) Oakland Healthcare Facility Augusta-Waterville, ME (µSA) 07/22/2015 2004 100% 20,000 (1) Wyomissing Healthcare Facility Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 07/24/2015 2007 100% 37,117 (1) Luling Healthcare Facility Austin-Round Rock-San Marcos, TX 07/30/2015 2003 100% 40,901 (1) Omaha Healthcare Facility Omaha, NE-IA 10/14/2015 2014 100% 40,402 (1) Sherman Healthcare Facility Sherman-Denison, TX 11/20/2015 2005 100% 57,576 (1) Sherman Healthcare Facility II Sherman-Denison, TX 11/20/2015 2005 100% 8,055 (1) Fort Worth Healthcare Facility III Dallas-Fort Worth-Arlington, TX 12/23/2015 1998 100% 36,800 (1) Oklahoma City Healthcare Facility Oklahoma City, OK 12/29/2015 1985 100% 94,076 (1) Oklahoma City Healthcare Facility II Oklahoma City, OK 12/29/2015 1994 100% 41,394 (1) Edmond Healthcare Facility Oklahoma City, OK 01/20/2016 2002 100% 17,700 (1) Oklahoma City Healthcare Facility III Oklahoma City, OK 01/27/2016 2006 100% 5,000 (1) Oklahoma City Healthcare Facility IV Oklahoma City, OK 01/27/2016 2007 100% 8,762 (1) Newcastle Healthcare Facility Oklahoma City, OK 02/03/2016 1995 100% 7,424 (1) Oklahoma City Healthcare Facility V Oklahoma City, OK 02/11/2016 2008 100% 43,676 (1) Rancho Mirage Healthcare Facility Riverside-San Bernardino-Ontario, CA 03/01/2016 2018 100% 47,008 (1) Oklahoma City Healthcare Facility VI Oklahoma City, OK 03/07/2016 2007 100% 14,676 (1) Oklahoma City Healthcare Facility VII Oklahoma City, OK 06/22/2016 2016 100% 102,978 (1) Las Vegas Healthcare Facility Las Vegas-Henderson-North Las Vegas, NV 06/24/2016 2017 100% 56,220 (1) Oklahoma City Healthcare Facility VIII Oklahoma City, OK 06/30/2016 1997 100% 62,857 (1) Marlton Healthcare Facility Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 11/01/2016 1995 100% 89,139 (1) Grand Rapids Healthcare Facility Grand Rapids-Wyoming-Kentwood, MI 12/07/2016 2008 80% 86,513 (1) Corpus Christi Healthcare Facility Corpus Christi, TX 12/22/2016 1992 100% 25,102 (1) Aurora Healthcare Facility Chicago-Naperville-Elgin, IL-IN 03/30/2017 2002 100% 24,722 (1) Allen Healthcare Facility Dallas-Fort Worth-Arlington, TX 03/31/2017 2007 100% 42,627 (1) Austin Healthcare Facility Austin-Round Rock-San Marcos, TX 03/31/2017 2012 100% 66,095 (1) Beaumont Healthcare Facility Beaumont-Port Arthur, TX 03/31/2017 1991 100% 61,000 (1) San Antonio Healthcare Facility San Antonio-New Braunfels, TX 06/29/2017 1984 100% 44,746 (1) Silverdale Healthcare Facility Bremerton-Silverdale-Port Orchard, WA 08/25/2017 2005 100% 26,127 (1) Silverdale Healthcare Facility II Bremerton-Silverdale-Port Orchard, WA 09/20/2017 2007 100% 19,184 (1) Saginaw Healthcare Facility Saginaw, MI 12/21/2017 2002 100% 87,843 (1) Carrollton Healthcare Facility Dallas-Fort Worth-Arlington, TX 04/27/2018 2015 100% 21,990 (1) Katy Healthcare Facility Houston-Pasadena-The Woodlands, TX 06/08/2018 2015 100% 34,296 (1) Indianola Healthcare Facility Des Moines-West Des Moines, IA 09/26/2018 2014 100% 18,116 (1) Indianola Healthcare Facility II Des Moines-West Des Moines, IA 09/26/2018 2011 100% 20,990 (1) Benton Healthcare Facility Little Rock-North Little Rock-Conway, AR 10/17/2018 1992/1999 100% 104,419 (1) Benton Healthcare Facility II Little Rock-North Little Rock-Conway, AR 10/17/2018 1983 100% 11,350 (1) Bryant Healthcare Facility Little Rock-North Little Rock-Conway, AR 10/17/2018 1995 100% 23,450 (1) Hot Springs Healthcare Facility Little Rock-North Little Rock-Conway, AR 10/17/2018 2009 100% 8,573 (1) Clive Healthcare Facility Des Moines-West Des Moines, IA 11/26/2018 2008 100% 58,156 (1) Valdosta Healthcare Facility Valdosta, GA 11/28/2018 2004 100% 24,750 (1) Valdosta Healthcare Facility II Valdosta, GA 11/28/2018 1992 100% 12,745 (1) 24 Table of Contents Property Name MSA/µSA Date Acquired Year Constructed % Leased Leased Sq Ft Encumbrances, $ (in thousands) Bryant Healthcare Facility II Little Rock-North Little Rock-Conway, AR 08/16/2019 2016 100% 16,425 (1) Laredo Healthcare Facility Laredo, TX 09/19/2019 1998 100% 61,677 (1) Laredo Healthcare Facility II Laredo, TX 09/19/2019 1998 100% 118,132 (1) Poplar Bluff Healthcare Facility Poplar Bluff, MO (µSA) 09/19/2019 2013 100% 71,519 (1) Tucson Healthcare Facility Tucson, AZ 09/19/2019 1998 100% 34,009 (1) Akron Healthcare Facility Akron, OH 10/04/2019 2012 100% 98,705 (1) Akron Healthcare Facility II Akron, OH 10/04/2019 2013 100% 38,564 (1) Akron Healthcare Facility III Akron, OH 10/04/2019 2008 100% 54,000 (1) Alexandria Healthcare Facility Alexandria, LA 10/04/2019 2007 100% 15,600 (1) Appleton Healthcare Facility Appleton, WI 10/04/2019 2011 100% 7,552 (1) Austin Healthcare Facility II Austin-Round Rock-San Marcos, TX 10/04/2019 2006 100% 18,273 (1) Bellevue Healthcare Facility Green Bay, WI 10/04/2019 2010 100% 5,838 (1) Bonita Springs Healthcare Facility Cape Coral-Fort Myers, FL 10/04/2019 2002 100% 9,800 — Bridgeton Healthcare Facility St.
We own fee simple interests in all of our land, buildings and improvements except for 20 properties, for which we own leasehold interests subject to the respective ground leases. 22 Table of Contents Property Statistics The following table shows the property statistics of our real estate portfolio as of December 31, 2025: Property Name MSA/µSA Date Acquired Year Constructed % Leased Leased Sq Ft Encumbrances, $ (in thousands) Houston Healthcare Facility Houston-Pasadena-The Woodlands, TX 07/31/2014 1993 100% 13,645 (1) Cincinnati Healthcare Facility Cincinnati, OH-KY-IN 10/29/2014 2001 100% 14,868 (1) Winston-Salem Healthcare Facility Winston-Salem, NC 12/17/2014 2004 100% 22,200 (1) Stoughton Healthcare Facility (2) Boston-Cambridge-Newton, MA-NH 12/23/2014 1973 —% — — Fort Worth Healthcare Facility Dallas-Fort Worth-Arlington, TX 12/31/2014 2014 100% 83,464 (1) Fort Worth Healthcare Facility II Dallas-Fort Worth-Arlington, TX 12/31/2014 2014 100% 8,268 (1) Winter Haven Healthcare Facility Lakeland-Winter Haven, FL 01/27/2015 2009 100% 7,560 (1) Overland Park Healthcare Facility Kansas City, MO-KS 02/17/2015 2014 100% 54,568 (1) Clarion Healthcare Facility Pittsburgh, PA 06/01/2015 2012 100% 33,000 (1) Webster Healthcare Facility Houston-Pasadena-The Woodlands, TX 06/05/2015 2015 100% 53,514 (1) Augusta Healthcare Facility Augusta-Waterville, ME (µSA) 07/22/2015 2010 100% 51,000 (1) Cincinnati Healthcare Facility III Cincinnati, OH-KY-IN 07/22/2015 2014 100% 41,600 (1) Florence Healthcare Facility Cincinnati, OH-KY-IN 07/22/2015 2014 100% 41,600 (1) Oakland Healthcare Facility Augusta-Waterville, ME (µSA) 07/22/2015 2004 100% 20,000 (1) Wyomissing Healthcare Facility Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 07/24/2015 2007 100% 37,117 (1) Luling Healthcare Facility Austin-Round Rock-San Marcos, TX 07/30/2015 2003 100% 40,901 (1) Omaha Healthcare Facility Omaha, NE-IA 10/14/2015 2014 100% 40,402 (1) Sherman Healthcare Facility Sherman-Denison, TX 11/20/2015 2005 100% 57,576 (1) Sherman Healthcare Facility II Sherman-Denison, TX 11/20/2015 2005 100% 8,055 (1) Fort Worth Healthcare Facility III Dallas-Fort Worth-Arlington, TX 12/23/2015 1998 100% 36,800 (1) Oklahoma City Healthcare Facility Oklahoma City, OK 12/29/2015 1985 100% 94,076 (1) Oklahoma City Healthcare Facility II Oklahoma City, OK 12/29/2015 1994 100% 41,394 (1) Edmond Healthcare Facility Oklahoma City, OK 01/20/2016 2002 100% 17,700 (1) Oklahoma City Healthcare Facility III Oklahoma City, OK 01/27/2016 2006 100% 5,000 (1) Oklahoma City Healthcare Facility IV Oklahoma City, OK 01/27/2016 2007 100% 8,762 (1) Newcastle Healthcare Facility Oklahoma City, OK 02/03/2016 1995 100% 7,424 (1) Oklahoma City Healthcare Facility V Oklahoma City, OK 02/11/2016 2008 100% 43,676 (1) Rancho Mirage Healthcare Facility Riverside-San Bernardino-Ontario, CA 03/01/2016 2018 100% 47,008 (1) Oklahoma City Healthcare Facility VI Oklahoma City, OK 03/07/2016 2007 100% 14,676 (1) Oklahoma City Healthcare Facility VII Oklahoma City, OK 06/22/2016 2016 100% 102,978 (1) Las Vegas Healthcare Facility Las Vegas-Henderson-North Las Vegas, NV 06/24/2016 2017 100% 56,220 (1) Oklahoma City Healthcare Facility VIII Oklahoma City, OK 06/30/2016 1997 100% 62,857 (1) Marlton Healthcare Facility Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 11/01/2016 1995 100% 89,139 (1) Grand Rapids Healthcare Facility Grand Rapids-Wyoming-Kentwood, MI 12/07/2016 2008 73% 78,419 (1) Corpus Christi Healthcare Facility Corpus Christi, TX 12/22/2016 1992 100% 25,102 (1) Aurora Healthcare Facility Chicago-Naperville-Elgin, IL-IN 03/30/2017 2002 100% 24,722 (1) Allen Healthcare Facility Dallas-Fort Worth-Arlington, TX 03/31/2017 2007 100% 42,627 (1) Austin Healthcare Facility Austin-Round Rock-San Marcos, TX 03/31/2017 2012 100% 66,095 (1) Beaumont Healthcare Facility Beaumont-Port Arthur, TX 03/31/2017 1991 100% 61,000 (1) San Antonio Healthcare Facility San Antonio-New Braunfels, TX 06/29/2017 1984 100% 44,746 (1) Silverdale Healthcare Facility Bremerton-Silverdale-Port Orchard, WA 08/25/2017 2005 100% 26,127 (1) Silverdale Healthcare Facility II Bremerton-Silverdale-Port Orchard, WA 09/20/2017 2007 100% 19,184 (1) Saginaw Healthcare Facility Saginaw, MI 12/21/2017 2002 100% 87,843 (1) Carrollton Healthcare Facility Dallas-Fort Worth-Arlington, TX 04/27/2018 2015 100% 21,990 (1) Katy Healthcare Facility Houston-Pasadena-The Woodlands, TX 06/08/2018 2015 100% 34,296 (1) Indianola Healthcare Facility Des Moines-West Des Moines, IA 09/26/2018 2014 100% 18,116 (1) Indianola Healthcare Facility II Des Moines-West Des Moines, IA 09/26/2018 2011 100% 20,990 (1) Benton Healthcare Facility Little Rock-North Little Rock-Conway, AR 10/17/2018 1992/1999 100% 104,419 (1) Benton Healthcare Facility II Little Rock-North Little Rock-Conway, AR 10/17/2018 1983 100% 11,350 (1) Bryant Healthcare Facility Little Rock-North Little Rock-Conway, AR 10/17/2018 1995 100% 23,450 (1) Hot Springs Healthcare Facility Little Rock-North Little Rock-Conway, AR 10/17/2018 2009 100% 8,573 (1) Clive Healthcare Facility Des Moines-West Des Moines, IA 11/26/2018 2008 100% 58,156 (1) Valdosta Healthcare Facility Valdosta, GA 11/28/2018 2004 100% 24,750 (1) Valdosta Healthcare Facility II Valdosta, GA 11/28/2018 1992 100% 12,745 (1) 23 Table of Contents Property Name MSA/µSA Date Acquired Year Constructed % Leased Leased Sq Ft Encumbrances, $ (in thousands) Bryant Healthcare Facility II Little Rock-North Little Rock-Conway, AR 08/16/2019 2016 100% 16,425 (1) Laredo Healthcare Facility Laredo, TX 09/19/2019 1998 100% 61,677 (1) Laredo Healthcare Facility II Laredo, TX 09/19/2019 1998 100% 118,132 (1) Poplar Bluff Healthcare Facility Poplar Bluff, MO (µSA) 09/19/2019 2013 100% 71,519 (1) Tucson Healthcare Facility Tucson, AZ 09/19/2019 1998 100% 34,009 (1) Akron Healthcare Facility Akron, OH 10/04/2019 2012 100% 98,705 (1) Akron Healthcare Facility II Akron, OH 10/04/2019 2013 100% 38,564 (1) Akron Healthcare Facility III Akron, OH 10/04/2019 2008 100% 54,000 (1) Alexandria Healthcare Facility Alexandria, LA 10/04/2019 2007 —% — (1) Appleton Healthcare Facility Appleton, WI 10/04/2019 2011 100% 7,552 (1) Austin Healthcare Facility II Austin-Round Rock-San Marcos, TX 10/04/2019 2006 100% 18,273 (1) Bellevue Healthcare Facility Green Bay, WI 10/04/2019 2010 100% 5,838 (1) Bonita Springs Healthcare Facility Cape Coral-Fort Myers, FL 10/04/2019 2002 100% 9,800 — Bridgeton Healthcare Facility St.
Petersburg-Clearwater, FL 09/08/2020 2015 100% 33,822 (1) Tucson Healthcare Facility IV Tucson, AZ 12/22/2020 2022 100% 44,692 (1) Greenwood Healthcare Facility Indianapolis-Carmel-Greenwood, IN 04/19/2021 2008 100% 53,560 (1) Clive Healthcare Facility II Des Moines-West Des Moines, IA 12/08/2021 2008 100% 63,224 (1) Clive Healthcare Facility III Des Moines-West Des Moines, IA 12/08/2021 2008 100% 33,974 (1) Clive Healthcare Facility IV Des Moines-West Des Moines, IA 12/08/2021 2009 100% 35,419 (1) Clive Undeveloped Land Des Moines-West Des Moines, IA 12/08/2021 — —% — — Clive Undeveloped Land II Des Moines-West Des Moines, IA 12/08/2021 — —% — — Yukon Healthcare Facility Oklahoma City, OK 03/10/2022 2020 100% 45,624 (1) Pleasant Hills Healthcare Facility Pittsburgh, PA 05/12/2022 2015 100% 33,712 (1) Prosser Healthcare Facility I Kennewick-Richland, WA 05/20/2022 2020 100% 6,000 (1) Prosser Healthcare Facility II Kennewick-Richland, WA 05/20/2022 2013 100% 9,230 (1) Prosser Healthcare Facility III Kennewick-Richland, WA 05/20/2022 2013 100% 5,400 (1) Tampa Healthcare Facility II Tampa-St.
Petersburg-Clearwater, FL 09/08/2020 2015 94% 31,674 (1) Tucson Healthcare Facility IV Tucson, AZ 12/22/2020 2022 95% 42,585 (1) Greenwood Healthcare Facility Indianapolis-Carmel-Greenwood, IN 04/19/2021 2008 100% 53,560 (1) Clive Healthcare Facility II Des Moines-West Des Moines, IA 12/08/2021 2008 100% 63,224 (1) Clive Healthcare Facility III Des Moines-West Des Moines, IA 12/08/2021 2008 100% 33,974 (1) Clive Healthcare Facility IV Des Moines-West Des Moines, IA 12/08/2021 2009 100% 35,419 (1) Clive Undeveloped Land Des Moines-West Des Moines, IA 12/08/2021 — —% — — Clive Undeveloped Land II Des Moines-West Des Moines, IA 12/08/2021 — —% — — Yukon Healthcare Facility Oklahoma City, OK 03/10/2022 2020 100% 45,624 (1) Pleasant Hills Healthcare Facility Pittsburgh, PA 05/12/2022 2015 100% 33,712 (1) Prosser Healthcare Facility I Kennewick-Richland, WA 05/20/2022 2020 100% 6,000 (1) Prosser Healthcare Facility II Kennewick-Richland, WA 05/20/2022 2013 100% 9,230 (1) Prosser Healthcare Facility III Kennewick-Richland, WA 05/20/2022 2013 100% 5,400 (1) Tampa Healthcare Facility II Tampa-St.
As of December 31, 2024, 120 of our real estate properties were leased to a single-tenant, 14 of our real estate properties were leased to multiple tenants, and one of our real estate properties was vacant. As of December 31, 2024, 96.0% of our rentable square feet was leased, with a weighted average remaining lease term of 9.7 years.
As of December 31, 2025, 124 of our real estate properties were leased to a single-tenant, 14 of our real estate properties were leased to multiple tenants, and two of our real estate properties were vacant. As of December 31, 2025, 98.7% of our rentable square feet was leased, with a weighted average remaining lease term of 10.0 years.
Real estate assets, other than land, are depreciated on a straight-line basis over each asset's useful life. Tenant improvements are depreciated on a straight-line basis over the shorter of the respective lease term or expected useful life. 26 Table of Contents Leases As of December 31, 2024, the weighted average remaining lease term of our properties was 9.7 years.
Real estate assets, other than land, are depreciated on a straight-line basis over each asset’s useful life. Generally, tenant improvements are depreciated on a straight-line basis over 5-20 years. 25 Table of Contents Leases As of December 31, 2025, the weighted average remaining lease term of our properties was 10.0 years.
As of December 31, 2024, 112 commercial real estate properties were contributed to the pool of unencumbered properties under our credit facility and we had an outstanding principal balance of $525,000,000. We believe the properties are adequately covered by insurance and are suitable for their respective intended purposes.
As of December 31, 2025, 119 commercial real estate properties were contributed to the pool of unencumbered properties under our credit facility and we had an outstanding principal balance of $676,000,000. (2) Property has been taken out of service and is being demolished. We believe the properties are adequately covered by insurance and are suitable for their respective intended purposes.
As of December 31, 2024, all of our real estate investments are in healthcare properties aside from two undeveloped land parcels.
As of December 31, 2025, all of our real estate investments are in healthcare properties aside from three undeveloped land parcels, including the Stoughton Healthcare Facility which has been taken out of service and is being demolished.
Lease expirations of our real properties based on annualized contractual base rent as of December 31, 2024, for each of the next ten years ending December 31 and thereafter, are as follows: Year of Lease Expiration Total Number of Leases Leased Sq Ft Annualized Contractual Base Rent (in thousands) (1) Percentage of Annualized Contractual Base Rent 2025 12 116,005 $ 3,606 2.2 % 2026 15 215,779 6,407 3.9 % 2027 10 279,909 7,337 4.4 % 2028 12 240,631 5,440 3.3 % 2029 25 425,082 10,802 6.5 % 2030 12 479,314 15,929 9.6 % 2031 14 510,352 21,094 12.8 % 2032 6 175,658 7,348 4.4 % 2033 14 312,706 13,815 8.4 % 2034 7 380,447 8,661 5.2 % Thereafter 42 1,913,665 64,791 39.3 % 169 5,049,548 $ 165,230 100.0 % (1) Annualized contractual base rent is based on leases in effect as of December 31, 2024.
Lease expirations of our real properties based on annualized contractual base rent as of December 31, 2025, for each of the next ten years ending December 31 and thereafter, are as follows: Year of Lease Expiration Total Number of Leases Leased Sq Ft Annualized Contractual Base Rent (in thousands) (1) Percentage of Annualized Contractual Base Rent 2026 13 185,849 $ 5,541 3.1 % 2027 9 212,995 4,462 2.5 % 2028 13 213,998 3,905 2.2 % 2029 27 446,918 11,639 6.5 % 2030 15 430,908 13,849 7.8 % 2031 15 519,114 21,749 12.2 % 2032 7 184,758 8,017 4.5 % 2033 14 312,706 14,152 8.0 % 2034 8 366,052 8,175 4.6 % 2035 8 280,093 9,443 5.3 % Thereafter 43 2,102,082 77,022 43.3 % 172 5,255,473 $ 177,954 100.0 % (1) Annualized contractual base rent is based on leases in effect as of December 31, 2025.
Item 2. Properties. Our principal executive office is located at 1001 Water Street, Suite 800, Tampa, Florida 33602. As of December 31, 2024, we owned a portfolio of 135 real estate properties, composed of approximately 5,263,000 rentable square feet of commercial spaces, and two undeveloped land parcels.
Item 2. Properties. Our principal executive office is located at 1001 Water Street, Suite 800, Tampa, Florida 33602.
Added
As of December 31, 2025, we owned a portfolio of 140 real estate properties, composed of approximately 5,323,000 rentable square feet of commercial spaces, and an additional three undeveloped land parcels, including the Stoughton Healthcare Facility which has been taken out of service and is being demolished.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest change(2) Consists of shares of Common Stock repurchased for the net settlement of withholding taxes in connection with the vesting of restricted stock. 29 Table of Contents Performance Graph The information below shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C, other than as provided in Item 201 of Regulation S-K, or to the liabilities of Section 18 of the Exchange Act, except to the extent we specifically request that such information be treated as soliciting material or specifically incorporate it by reference into a filing under the Securities Act or the Exchange Act.
Biggest changePerformance Graph The information below shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C, other than as provided in Item 201 of Regulation S-K, or to the liabilities of Section 18 of the Exchange Act, except to the extent we specifically request that such information be treated as soliciting material or specifically incorporate it by reference into a filing under the Securities Act or the Exchange Act. 27 Table of Contents The following graph compares the total cumulative stockholder return, assuming reinvestment of dividends, of our Common Stock to the Standard & Poor’s 500 Composite Stock Index, or the S&P 500, and the MSCI US REIT Index for the period beginning June 13, 2024 (the date our Common Stock began trading on the NYSE) and ending December 31, 2025.
Repurchases of Common Stock under the Share Repurchase Program may be made from time to time in the open market, in privately negotiated purchases, in accelerated share repurchase programs or by any other lawful means.
Repurchases of Common Stock under the 2025 SRP may be made from time to time in the open market, in privately negotiated purchases, in accelerated share repurchase programs or by any other lawful means.
Period Ending Index 06/13/2024 12/31/2024 Sila Realty Trust, Inc. $ 100.00 $ 110.76 S&P 500 $ 100.00 $ 109.04 MSCI US REIT Index $ 100.00 $ 110.61 Item 6. [Reserved] Information pertaining to Item 6 is not presented in accordance with amendments to Item 301 of Regulation S-K. 30 Table of Contents
Period Ending Index 06/13/2024 12/31/2024 12/31/2025 Sila Realty Trust, Inc. $ 100.00 $ 110.76 $ 113.25 S&P 500 $ 100.00 $ 109.04 $ 128.54 MSCI US REIT Index $ 100.00 $ 110.61 $ 113.87 Item 6. [Reserved] Information pertaining to Item 6 is not presented in accordance with amendments to Item 301 of Regulation S-K.
As a REIT, we make distributions each taxable year equal to at least 90% of our REIT taxable income (computed without regard to the dividends paid deduction and excluding capital gains).
Distributions We are taxed and conduct our operations so as to qualify as a REIT for federal income tax purposes. As a REIT, we make distributions each taxable year equal to at least 90% of our REIT taxable income (computed without regard to the dividends paid deduction and excluding capital gains).
The number of shares of Common Stock purchased and the timing of any purchases will depend on a number of factors, including the price and availability of Common Stock and general market conditions. No shares were repurchased under the Share Repurchase Program during the year ended December 31, 2024.
The number of shares of Common Stock purchased and the timing of any purchases will depend on a number of factors, including the price and availability of Common Stock and general market conditions. The 2025 SRP replaced the Company’s prior share repurchase program.
On February 25, 2025, the Board approved and authorized a quarterly cash dividend of $0.40 per share of Common Stock payable on March 26, 2025, to our stockholders of record as of the close of business on March 12, 2025. The quarterly cash dividend of $0.40 per share represents an annualized amount of $1.60 per share.
One of our primary goals is to continue to pay quarterly distributions to our stockholders. On February 23, 2026, the Board approved and authorized a quarterly cash dividend of $0.40 per share of Common Stock payable on March 18, 2026, to our stockholders of record as of the close of business on March 6, 2026.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information On June 13, 2024, our Common Stock began trading on the NYSE, under the ticker symbol "SILA". Prior to that time, there was no public market for the shares of our Common Stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our Common Stock trades on the NYSE under the ticker symbol “SILA”. As of February 18, 2026, we had 8,300 stockholders of record.
We did not repurchase any shares under the Share Repurchase Program during the three months ended December 31, 2024. Therefore, as of December 31, 2024, up to $25,000,000 of our Common Stock remained available for repurchase under the Share Repurchase Program.
During the three months ended December 31, 2025, we did not repurchase any equity securities registered pursuant to Section 12 of the Exchange Act and $75,000,000 in gross proceeds remained available under the 2025 SRP as of December 31, 2025.
Share Repurchase Program On August 16, 2024, the Board authorized a share repurchase program of up to the lesser of 1,500,000 shares of our outstanding Common Stock, or $25,000,000 in gross purchase proceeds for a period of 12 months from August 16, 2024, or the Share Repurchase Program.
Unregistered Sales of Equity Securities There were no unregistered sales of equity securities during the quarter ended December 31, 2025. 26 Table of Contents Share Repurchases Share Repurchase Program On August 4, 2025, the Board authorized a share repurchase program of up to $75,000,000 in gross purchase proceeds for a period of three-years from August 4, 2025, subject to the limitation of $25,000,000 in gross purchase proceeds in any twelve-month period, or the 2025 SRP.
Removed
As of February 24, 2025, we had 10,024 stockholders of record.
Added
The quarterly cash dividend of $0.40 per share represents an annualized amount of $1.60 per share.
Removed
Reverse Stock Split On April 8, 2024, in anticipation of the Listing, we amended our charter to effect a one-for-four reverse stock split of each issued and outstanding share of each class of our Common Stock, effective May 1, 2024, and we also amended our charter to decrease the par value of each issued and outstanding share of our Common Stock from $0.04 par value per share to $0.01 par value per share immediately after the Reverse Stock Split.
Added
The Company did not repurchase any shares under the 2025 SRP during the year ended December 31, 2025. During the year ended December 31, 2025, 304,878 shares of Common Stock were repurchased for an aggregate purchase price of $7,344,000, excluding all related costs and fees (an average of $24.09 per share) under the Company’s prior share repurchase program.
Removed
In addition, equitable adjustments were made to the maximum number of shares of our Common Stock that may be issued pursuant to the A&R Incentive Plan to reflect the Reverse Stock Split. The number of shares of our Common Stock subject to outstanding awards under the A&R Incentive Plan were also equitably adjusted to reflect the Reverse Stock Split.
Removed
The Reverse Stock Split affected all record holders of our Common Stock uniformly and did not affect any record holder’s percentage ownership interest. The Reverse Stock Split did not affect the number of our authorized shares of Common Stock.
Removed
All references made to share or per share amounts in the accompanying 27 Table of Contents consolidated financial statements and applicable disclosures have been retroactively adjusted as though the Reverse Stock Split had been effectuated prior to all periods presented. DRIP Offering The DRIP was terminated effective May 1, 2024 in connection with the Listing.
Removed
During the year ended December 31, 2024, we issued 333,402 shares pursuant to the DRIP, prior to the termination. Distributions We are taxed and qualify as a REIT for federal income tax purposes.
Removed
One of our primary goals is to continue to pay distributions to our stockholders, which will be paid quarterly effective in 2025 (as disclosed in the Current Report on Form 8-K that we filed with the SEC on October 18, 2024).
Removed
Unregistered Sales of Equity Securities There were no unregistered sales of equity securities during the quarter ended December 31, 2024.
Removed
Share Repurchases "Dutch Auction" Tender Offer On June 13, 2024, in conjunction with the Listing, we commenced the Tender Offer to purchase shares of our Common Stock for cash at a price per share of not greater than $24.00 nor less than $22.60, net to the seller in cash, less any applicable withholding taxes and without interest, for a maximum aggregate purchase price of no more than $50,000,000.
Removed
The Tender Offer expired on July 19, 2024.
Removed
As a result of the Tender Offer, we accepted for purchase 2,212,389 shares of Common Stock (which represented approximately 3.9% of the total number of shares of Common Stock outstanding as of July 19, 2024) at a purchase price of $22.60 per share, for an aggregate purchase price of approximately $50,000,000, excluding all related costs and fees.
Removed
We incurred $2,093,000 of costs and fees related to the Tender Offer which are recorded as a reduction in equity on the accompanying consolidated financial statements. We funded the Tender Offer and related costs and fees with our available cash.
Removed
Terminated Share Repurchase Program Prior to the Listing, we had adopted an Amended and Restated Share Repurchase Program, or the Terminated SRP, that allowed for repurchases of shares of our Common Stock upon meeting certain criteria.
Removed
Pursuant to the terms of the Terminated SRP, we were permitted to redeem no more than 5% of the number of shares of our Common Stock outstanding on December 31st of the previous calendar year, and we would redeem shares at a price equal to the most recently published net asset value per share.
Removed
We had discretion as to the timing of our repurchases, but they were generally done quarterly. On April 5, 2024, the Board approved the suspension of the Terminated SRP, effective immediately, and the termination of the Terminated SRP, effective upon the Listing.
Removed
During the year ended December 31, 2024, we redeemed 210,683 shares under the Terminated SRP. 28 Table of Contents During the three months ended December 31, 2024, we repurchased shares of our Common Stock as follows: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs (1) October 1, 2024 - October 31, 2024 — $ — — $ 25,000,000 November 1, 2024 - November 30, 2024 1,002 (2) $ 24.68 — $ 25,000,000 December 1, 2024 - December 31, 2024 36,701 (2) $ 24.32 — $ 25,000,000 Total 37,703 $ 24.33 — (1) Represents the gross purchase proceeds that may be repurchased pursuant to the Share Repurchase Program (announced on August 19, 2024), for a period of 12 months from August 16, 2024.
Removed
The following graph compares the total cumulative stockholder return, assuming reinvestment of dividends, of our Common Stock to the Standard & Poor's 500 Composite Stock Index, or the S&P 500, and the MSCI US REIT Index for the period beginning June 13, 2024 (the date our Common Stock began trading on the NYSE) and ending December 31, 2024.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeFinancing Activities Significant financing activities included: • Payment of $81,367,000 in cash distributions to common stockholders, including cash distributions on vested performance-based deferred stock unit awards, during the year ended December 31, 2024, compared to $66,515,000 during the year ended December 31, 2023. • Tender Offer repurchase of $50,000,000 of Common Stock and $2,093,000 of costs and fees related to the Tender Offer during the year ended December 31, 2024. • Repurchase of $9,402,000 of Common Stock pursuant to the Terminated SRP and for the net settlement of withholding taxes in connection with the vesting of restricted stock during the year ended December 31, 2024, compared to $12,374,000 during the year ended December 31, 2023. • Payment of $2,578,000 in deferred financing costs as a result of entering into the 2027 Term Loan Agreement during the year ended December 31, 2024, compared to $193,000 during the year ended December 31, 2023. • The following Unsecured Credit Facility related activity during the year ended December 31, 2024: ◦ Replacement of $250,000,000 on our prior term loan with borrowings from the 2027 Term Loan Agreement. ◦ Draw of $20,000,000 on the 2026 Revolving Credit Agreement to fund an acquisition. ◦ Repayment of $20,000,000 on the 2026 Revolving Credit Agreement with proceeds from dispositions and cash flows from operations. • The following Unsecured Credit Facility related activity during the year ended December 31, 2023: ◦ Repayment of $58,000,000 on the 2026 Revolving Credit Agreement with cash flows from operations and proceeds from a disposition. ◦ Repayment of $50,000,000 on the 2024 Term Loan Agreement with proceeds from a disposition, the collection of a note receivable related to a disposition and cash flows from operations; and ◦ Draw of $50,000,000 on the 2026 Revolving Credit Agreement to fund an acquisition.
Biggest changeFinancing Activities Significant financing activities included: • Payment of $88,787,000 in cash distributions to common stockholders, including cash distributions on vested performance-based deferred stock unit awards, during the year ended December 31, 2025, compared to $81,367,000 during the year ended December 31, 2024. • Repurchase of $8,634,000 of Common Stock for a prior share repurchase program and the net settlement of withholding taxes in connection with the vesting of restricted stock and issuance of performance-based deferred stock unit awards during the year ended December 31, 2025, compared to $61,495,000 of Common Stock repurchased for the tender offer, costs and fees related to the tender offer, our prior share repurchase program and the net settlement of withholding taxes in connection with the vesting of restricted stock and issuance of performance-based deferred stock unit awards during the year ended December 31, 2024. • Payment of $5,783,000 in deferred financing costs primarily as a result of entering into the 2029 Revolving Credit Agreement during the year ended December 31, 2025, compared to $2,578,000 as a result of entering into the 2027 Term Loan Agreement during the year ended December 31, 2024. • The following Unsecured Credit Facility related activity during the year ended December 31, 2025: ◦ Drew $164,000,000 on the 2029 Revolving Credit Agreement to fund acquisitions and mezzanine loan fundings. ◦ Repayment of $13,000,000 on the 2029 Revolving Credit Agreement with cash provided by operations. • The following Unsecured Credit Facility related activity during the year ended December 31, 2024: ◦ Replacement of $250,000,000 on our prior term loan with borrowings from the 2027 Term Loan Agreement. ◦ Draw of $20,000,000 on the 2026 Revolving Credit Agreement to fund an acquisition. ◦ Repayment of $20,000,000 on the 2026 Revolving Credit Agreement with proceeds from dispositions and cash flows from operations.
In calculating the undiscounted net cash flows of an asset group, we use considerable judgment to estimate several inputs. We estimate future rental rates, future capital expenditures, future operating expenses, and market capitalization rates for residual values, among other things.
In calculating the undiscounted cash flows of an asset group, we use considerable judgment to estimate several inputs. We estimate future rental rates, future capital expenditures, future operating expenses, and market capitalization rates for residual values, among other things.
As of December 31, 2024, the maximum commitments available under our senior unsecured term loan with Truist Bank, as Administrative Agent for the lenders, or the 2028 Term Loan Agreement, were $275,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $500,000,000 and has a maturity date of January 31, 2028.
As of December 31, 2025, the maximum commitments available under our senior unsecured term loan with Truist Bank, as Administrative Agent for the lenders, or the 2028 Term Loan Agreement, were $275,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $500,000,000 and has a maturity date of January 31, 2028.
As of December 31, 2024, the aggregate notional amount under our derivative instruments was $525,000,000. We have agreements with each derivative counterparty that contain cross-default provisions; if we default on our indebtedness, then we could also be declared in default on our derivative obligations, resulting in an acceleration of payment of any net amounts due under our derivative contracts.
As of December 31, 2025, the aggregate notional amount under our derivative instruments was $525,000,000. We have agreements with each derivative counterparty that contain cross-default provisions; if we default on our indebtedness, then we could also be declared in default on our derivative obligations, resulting in an acceleration of payment of any net amounts due under our derivative contracts.
We are required by the terms of certain loan documents relating to the Unsecured Credit Facility to meet certain covenants, such as financial ratios and reporting requirements. As of December 31, 2024, we were in compliance with all such covenants and requirements on our Unsecured Credit Facility.
We are required by the terms of certain loan documents relating to the Unsecured Credit Facility to meet certain covenants, such as financial ratios and reporting requirements. As of December 31, 2025, we were in compliance with all such covenants and requirements on our Unsecured Credit Facility.
Additionally, changes in economic and operating conditions, including changes in the financial 32 Table of Contents condition of our tenants, and changes to our intent and ability to hold the related asset, that occur after our impairment assessment could impact the assumptions used in that assessment and could result in future charges to earnings if assumptions regarding those investments differ from actual results.
Additionally, changes in economic and operating conditions, including changes in the financial condition of our tenants, and changes to our intent and ability to hold the related asset, that occur after our impairment assessment could impact the assumptions used in that assessment and could result in future charges to earnings if assumptions regarding those investments differ from actual results.
The maturity date for the 2029 Revolving Credit Agreement is February 16, 2029, which, at our election, may be extended for a period of six-months on no more than two occasions, subject to certain conditions, including a payment of an extension fee.
The maturity date for the 2029 Revolving Credit Agreement is February 16, 2029, which, at our election, may be extended for a period of six-months on no more than two occasions, subject to certain 35 Table of Contents conditions, including the payment of an extension fee.
The amount of distributions payable to our stockholders is determined by the Board and is dependent on a number of factors, including our funds available for distribution, financial condition, lenders' restrictions and limitations, capital expenditure requirements, corporate law restrictions and the annual distribution requirements needed to maintain our status as a REIT under the Code.
Distributions to Stockholders The amount of distributions payable to our stockholders is determined by the Board and is dependent on a number of factors, including our funds available for distribution, financial condition, lenders’ restrictions and limitations, capital expenditure requirements, corporate law restrictions and the annual distribution requirements needed to maintain our status as a REIT under the Internal Revenue Code of 1986, as amended.
This section of the Annual Report on Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
This section of the Annual Report on Form 10-K generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.
Repurchases of Common Stock under the Share Repurchase Program may be made from time to time in the open market, in privately negotiated purchases, in accelerated share repurchase programs or by any other lawful means.
Repurchases of Common Stock under the 2025 SRP may be made from time to time in the open market, in privately negotiated purchases, in accelerated share repurchase programs or by any other lawful means.
We currently expect to meet our long-term liquidity requirements through proceeds from cash flows from operations and borrowings on our credit facility, potential other borrowings and potential equity offerings. We expect to pay distributions to our stockholders from cash flows from operations; however, we have used, and may continue to use, other sources to fund distributions, as necessary.
We currently expect to meet our long-term liquidity requirements through proceeds from cash flows from operations and borrowings on our credit facility, potential other borrowings and potential equity offerings. We expect to pay distributions to our stockholders from cash flows from operations; however, we have used, and may in the future use, other sources to fund distributions, as necessary.
As of December 31, 2024, the 2027 Term Loan Agreement had an aggregate outstanding principal balance of $250,000,000.
As of December 31, 2025, the 2027 Term Loan Agreement had an aggregate outstanding principal balance of $250,000,000.
The 38 Table of Contents 2027 Term Loan Agreement has a maturity date of March 20, 2027, and, at our election, may be extended for a period of one year on no more than two occasions, subject to the satisfaction of certain conditions, including the payment of an extension fee.
The 2027 Term Loan Agreement has a maturity date of March 20, 2027, which, at our election, may be extended for a period of one year on no more than two occasions, subject to the satisfaction of certain conditions, including the payment of an extension fee.
As of December 31, 2024, we were in compliance with all such cross-default provisions.
As of December 31, 2025, we were in compliance with all such cross-default provisions.
One of our principal liquidity needs is the payment of principal and interest on outstanding indebtedness. As of December 31, 2024, we had $525,000,000 of principal outstanding under our Unsecured Credit Facility (as defined below).
One of our principal liquidity needs is the payment of principal and interest on outstanding indebtedness. As of December 31, 2025, we had $676,000,000 of principal outstanding under our Unsecured Credit Facility (as defined below).
The 2028 Term Loan Agreement is pari passu with our 2026 Revolving Credit Agreement and 2027 Term Loan Agreement. As of December 31, 2024, the 2028 Term Loan Agreement had an aggregate outstanding principal balance of $275,000,000.
The 2028 Term Loan Agreement is pari passu with our 2029 Revolving Credit Agreement and 2027 Term Loan Agreement. As of December 31, 2025, the 2028 Term Loan Agreement had an aggregate outstanding principal balance of $275,000,000.
Critical Accounting Estimates The preparation of our consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses. Changes in these estimates and assumptions could have a significant effect on the financial statements.
Critical Accounting Estimates The preparation of our consolidated financial statements in conformity with United States generally accepted accounting principles, or GAAP, requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses. Changes in these estimates and assumptions could have a significant effect on the financial statements.
In order to evaluate our overall portfolio, management analyzes the results of our same store properties. We define "same store properties" as properties that were owned and operated for the entirety of both calendar periods being compared and exclude properties under development, re-development, or classified as held for sale.
In order to evaluate our overall portfolio, management analyzes the results of our “same store properties.” We define “same store properties” as properties that were owned and operated for the entirety of both calendar periods being compared and exclude properties under development, redevelopment, or classified as held for sale.
Debt Service Requirements Credit Facility As of December 31, 2024, the maximum commitments available under our senior unsecured revolving line of credit with Truist Bank, as Administrative Agent for the lenders, or the 2026 Revolving Credit Agreement, were $500,000,000, which may be increased, subject to lender approval, through incremental term loans and/or revolving loan commitments in an aggregate amount not to exceed $1,000,000,000.
Debt Service Requirements Credit Facility As of December 31, 2025, the maximum commitments available under our senior unsecured revolving line of credit with Bank of America, N.A., as Administrative Agent for the lenders, or the 2029 Revolving Credit Agreement, were $600,000,000, which may be increased, subject to lender approval, through incremental term loans and/or revolving loan commitments in an aggregate amount not to exceed $1,500,000,000.
We currently expect that substantially all net cash flows from our operations will be used to fund acquisitions, certain capital expenditures identified at acquisition, ongoing capital expenditures, interest and principal payments on outstanding debt and distributions to our stockholders. Material Cash Requirements As of December 31, 2024, we had $39,844,000 in cash and cash equivalents.
We currently expect that substantially all net cash flows from our operations will be used to fund acquisitions, certain capital expenditures and tenant improvement allowances identified at acquisition, ongoing capital expenditures, interest and principal payments on outstanding debt and distributions to our stockholders. Material Cash Requirements As of December 31, 2025, we had $32,288,000 in cash and cash equivalents.
Economic and Market Conditions Our operating results have been and will continue to be generally impacted by global and national economic and market conditions and by the local economic conditions where our real estate properties are located.
Factors That May Influence Results of Operations Economic and Market Conditions Our operating results have been and will continue to be generally impacted by global and national economic and market conditions and by the local economic conditions where our real estate properties are located.
We calculate AFFO by further adjusting Core FFO for the following items: deferred rent, current period straight-line rent adjustments, amortization of deferred financing costs and stock-based compensation. We believe AFFO is a supplemental performance measure that provides investors appropriate supplemental information to evaluate our ongoing operations. AFFO is a metric used by management to evaluate our dividend policy.
We calculate AFFO by further adjusting Core FFO for the following items: deferred rent, current period straight-line rent adjustments, amortization of deferred financing costs, amortization of fees on our real estate related notes receivable, and stock-based compensation. We believe AFFO is a supplemental performance measure that provides investors appropriate supplemental information to evaluate our ongoing operations.
As of December 31, 2023, we owned 131 real estate properties and two undeveloped land parcels.
As of December 31, 2024, we owned 135 real estate properties and two undeveloped land parcels.
Presentation of this information is intended to assist management and investors in comparing the operating performance of different REITs, although it should be noted that not all REITs calculate FFO, Core FFO and AFFO the same way, so comparisons with other REITs may not be meaningful.
AFFO is a metric used by management to evaluate our dividend policy. 38 Table of Contents Presentation of this information is intended to assist management and investors in comparing the operating performance of different REITs, although it should be noted that not all REITs calculate FFO, Core FFO and AFFO the same way, so comparisons with other REITs may not be meaningful.
Attributable to Class A shares, Class I shares, and Class T shares of common stock for the year ended December 31, 2023.
Attributable to Class A shares, Class I shares, and Class T shares of common stock until the Listing and attributable to Common Stock after the Listing for the year ended December 31, 2024.
During the year ended December 31, 2023, we recognized a gain on disposition on two real estate properties. On September 29, 2023, we sold one property for a sales price of $250,000, resulting in a gain on sale of $1,000.
During the year ended December 31, 2024, we recognized a gain on disposition on two real estate properties. On January 31, 2024, we sold one property for a sale price of $1,500,000, resulting in a gain on sale of $76,000.
Higher interest rates imposed by the Federal Reserve to address potential inflation may adversely impact our borrowing costs and real estate asset values generally, including our real estate properties. In addition, any tariffs imposed by the current administration or other countries may cause further inflationary pressures in the economy.
Continued elevated interest rates imposed by the Federal Reserve to address potential inflation may adversely impact our borrowing costs and real estate asset values generally, including our real estate properties. In addition, any tariffs imposed by the United States or other countries, as well as any prolonged government shutdown, may cause additional impacts to the economy, including further inflationary pressures.
To the extent that we make a distribution in excess of our current or accumulated earnings and profits, such excess will be a nontaxable return of capital, reducing the tax basis in each U.S. stockholder’s shares. Further, the amount of distributions in excess of a U.S. stockholder’s tax basis in such shares will be taxable as a realized gain.
For federal income tax purposes, distributions to common stockholders are characterized as ordinary dividends, capital gain distributions, or nontaxable distributions. To the extent that we make a distribution in excess of our current or accumulated earnings and profits, such excess will be a nontaxable return of capital, reducing the tax basis in each U.S. stockholder’s shares.
As of December 31, 2024, we had material obligations beyond twelve months in the amount of $679,195,000, inclusive of $564,548,000 related to principal and estimated interest payments on our outstanding debt (calculated based on our effective interest rates as of December 31, 2024) and $114,647,000 related to our various obligations as lessee.
As of December 31, 2025, we had material obligations beyond twelve months in the amount of $818,998,000, inclusive of $707,068,000 related to principal and estimated interest payments on our outstanding debt (calculated based on our effective interest rates as of December 31, 2025) and $111,930,000 related to our various obligations as lessee.
We believe FFO provides a useful understanding of our performance to the investors and to our management, and when compared to year over year, FFO reflects the impact on our operations from trends in occupancy. 41 Table of Contents We calculate Core FFO by adjusting FFO to remove the effect of certain GAAP non-cash income and expense items, unusual and infrequent items that are not expected to impact our operating performance on an ongoing basis, items that affect comparability to prior periods and/or items that are not related to our core real estate operations.
We calculate Core FFO by adjusting FFO to remove the effect of certain GAAP non-cash income and expense items, unusual and infrequent items that are not expected to impact our operating performance on an ongoing basis, items that affect comparability to prior periods and/or items that are not related to our core real estate operations.
Increased interest rates, persistent inflation, ongoing geopolitical tensions, and increased volatility in public and private equity and fixed income markets have led to increased costs and have limited the availability of capital. In response to inflationary pressures, the Federal Reserve began raising interest rates in 2022.
Increased interest rates, persistent elevated prices due to recent inflation, ongoing geopolitical tensions, and increased volatility in public and private equity and fixed income markets have led to increased costs and have limited the availability of capital.
As of December 31, 2024, the maximum commitments available under the 2027 Term Loan Agreement, were $250,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $500,000,000.
As of December 31, 2025, the maximum commitments available under our senior unsecured amended and restated term loan agreement with Truist Bank, as Administrative Agent for the lenders, or the 2027 Term Loan Agreement, were $250,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $500,000,000.
Most of our lease agreements contain provisions designed to mitigate the adverse impact of inflation, including annual rent increases based on stated increases or consumer price index (CPI) increases.
Most of our lease agreements contain provisions designed to mitigate the adverse impact of inflation, including annual rent increases based on stated increases or consumer price index (CPI) increases, as well as the triple net nature of the leases whereby tenants are responsible for the operating expenses of the properties.
Short-term Liquidity and Capital Resources For at least the next twelve months, we expect our principal demands for funds will be for operating expenses, including our general and administrative expenses, as well as the acquisition of real estate and real estate-related investments, including mezzanine loans, and funding of capital improvements and tenant improvements, distributions to, and potential stock repurchases from, stockholders, and interest payments on our credit facility.
During the year ended December 31, 2025, no shares were issued under the ATM Program and as of December 31, 2025, we had $250,000,000 in gross sales of available capacity under the ATM Program. 34 Table of Contents Short-term Liquidity and Capital Resources For at least the next twelve months, we expect our principal demands for funds will be for operating expenses, including our general and administrative expenses, as well as the acquisition of real estate and real estate related investments, and funding of capital improvements, including developments, and tenant improvements, distributions to, and potential stock repurchases from, stockholders, and interest payments on our credit facility.
While interest rates on variable rate debt increased in recent years and then declined some due to the recent interest rate cuts by the Federal Reserve, we believe our exposure to increased or fluctuating interest rates is limited at this time due to our hedging strategy, which has effectively fixed 100% of our outstanding debt as of December 31, 2024, and therefore allowed us to reasonably project our liquidity needs.
That said, we believe our exposure to increased or fluctuating interest rates is limited at this time due to our hedging strategy, which has effectively fixed 78% of our outstanding debt as of December 31, 2025, and therefore allowed us to reasonably project our liquidity needs.
As of December 31, 2024, we had a total pool availability under our Unsecured Credit Facility of $1,025,000,000 and an aggregate outstanding principal balance of $525,000,000; therefore, $500,000,000 was available to be drawn under our Unsecured Credit Facility. We were in compliance with all the financial covenant requirements of the Unsecured Credit Facility as of December 31, 2024.
As of December 31, 2025, we had a total pool availability under our Unsecured Credit Facility of $1,125,000,000 and an aggregate outstanding principal balance of $676,000,000; therefore, $449,000,000 was available to be drawn under our Unsecured Credit Facility.
We identify an asset group based on the lowest level of identifiable cash flows. In the impairment analysis we must determine whether there are indicators of impairment.
We review our real estate assets on an asset group basis for impairment. Typically, an individual property constitutes an asset group. We identify an asset group based on the lowest level of identifiable cash flows. During the impairment analysis, we must determine whether there are indicators of impairment.
The following table summarizes our real estate activity for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 Real estate properties acquired 8 2 Real estate properties disposed 4 3 Aggregate purchase price of real estate properties acquired (1) $ 164,053,000 $ 69,822,000 Net book value of real estate properties disposed $ 18,099,000 $ 270,279,000 Leased square feet of real estate property additions 307,000 130,000 Leased square feet of real estate property dispositions (2) 71,000 551,000 (1) Includes capitalized acquisition costs associated with transactions determined to be asset acquisitions.
The following table summarizes our real estate activity for the years ended December 31, 2025 and 2024: Year Ended December 31, 2025 2024 Real estate properties acquired 6 8 Real estate properties disposed — 4 Aggregate purchase price of real estate properties acquired (1)(2) $ 148,877,000 $ 164,053,000 Net book value of real estate properties disposed $ — $ 18,099,000 Leased square feet of real estate property additions 241,000 307,000 Leased square feet of real estate property dispositions (3) — 71,000 (1) Includes $2,676,000 for additional land purchased to expand the Dover Healthcare Facility for the year ended December 31, 2025.
We refer to the 2026 Revolving Credit Agreement, the 2027 Term Loan Agreement and the 2028 Term Loan Agreement, collectively, as the “Unsecured Credit Facility,” which has aggregate commitments available of $1,025,000,000, as of December 31, 2024.
The 2029 Revolving Credit Agreement, the 2027 Term Loan Agreement and the 2028 Term Loan Agreement, or collectively, the Unsecured Credit Facility, has aggregate commitments available of $1,125,000,000, as of December 31, 2025.
The number of shares of Common Stock purchased and the timing of any purchases will depend on a number of factors, including the price and availability of Common Stock and general market conditions. We did not repurchase any shares under the Share Repurchase 31 Table of Contents Program during the year ended December 31, 2024.
The number of shares of Common Stock purchased and the timing of any purchases will depend on a number of factors, including the price and availability of Common Stock and general market conditions. The 2025 SRP replaced the Company’s prior share repurchase program.
The following table shows the property statistics of our real estate properties as of December 31, 2024 and 2023: December 31, 2024 2023 Number of real estate properties (1) 135 131 Leased square feet 5,050,000 5,085,000 Weighted average percentage of rentable square feet leased 96.0 % 99.4 % (1) As of December 31, 2024, we owned 135 real estate properties and two undeveloped land parcels.
The following table shows the property statistics of our real estate properties as of December 31, 2025 and 2024: December 31, 2025 2024 Number of real estate properties (1) 140 135 Leased square feet 5,255,000 5,050,000 Weighted average percentage of rentable square feet leased 98.7 % 96.0 % (1) As of December 31, 2025 we owned 140 real estate properties and three undeveloped land parcels, including the Stoughton Healthcare Facility which has been taken out of service and is being demolished.
The method used to evaluate the value and performance of real estate under GAAP should be considered a more relevant measure of operating performance and more prominent than the non-GAAP financial measures presented here. 42 Table of Contents Reconciliation of Net Income to FFO, Core FFO and AFFO The following table presents a reconciliation of net income attributable to common stockholders, which is the most directly comparable GAAP financial measure, to FFO, Core FFO and AFFO for the years ended December 31, 2024 and 2023 (amounts in thousands): Year Ended December 31, 2024 2023 Net income attributable to common stockholders $ 42,657 $ 24,042 Adjustments: Depreciation and amortization of real estate assets 74,660 74,202 Gain on dispositions of real estate (341) (22) Impairment and disposition losses 1,210 24,252 FFO (1) $ 118,186 $ 122,474 Adjustments: Listing-related expenses 3,012 — Severance 1,885 1,401 Write-off of straight-line rent receivables related to prior periods — 3,268 Accelerated stock-based compensation 936 318 Amortization of above (below) market lease intangibles, including ground leases, net 1,778 1,386 Loss on extinguishment of debt 228 — Core FFO (1) $ 126,025 $ 128,847 Adjustments: Deferred rent (2) 3,510 1,644 Straight-line rent adjustments (5,555) (5,465) Amortization of deferred financing costs 2,185 1,665 Stock-based compensation 4,914 5,966 AFFO (1) $ 131,079 $ 132,657 (1) The years ended December 31, 2024 and 2023 include $4,098,000 and $5,650,000, respectively, of lease termination fee income received.
Reconciliation of Net Income to FFO, Core FFO and AFFO The following table presents a reconciliation of net income attributable to common stockholders, which is the most directly comparable GAAP financial measure, to FFO, Core FFO and AFFO for the years ended December 31, 2025 and 2024 (amounts in thousands): Year Ended December 31, 2025 2024 Net income attributable to common stockholders (1)(2) $ 33,120 $ 42,657 Adjustments: Depreciation and amortization of real estate assets 76,838 74,660 Gain on dispositions of real estate — (341) Impairment and disposition losses 9,951 1,210 FFO (1)(2) $ 119,909 $ 118,186 Adjustments: Listing-related expenses — 3,012 Severance 33 1,885 Write-off of straight-line rent receivables related to prior periods 462 — Accelerated stock-based compensation 19 936 Amortization of above (below) market lease intangibles, including ground leases, net 78 1,778 Loss on extinguishment of debt 233 228 Increase in current expected credit loss reserve 180 — Demolition costs 1,011 — Core FFO (1)(2) $ 121,925 $ 126,025 Adjustments: Deferred rent (3) 1,226 3,510 Straight-line rent adjustments (9,763) (5,555) Amortization of deferred financing costs 2,823 2,185 Amortization of fees on real estate related notes receivable (94) — Stock-based compensation 4,796 4,914 AFFO (1)(2) $ 120,913 $ 131,079 (1) The year ended December 31, 2025 includes $295,000 of lease termination fee income received.
(2) The year ended December 31, 2024 includes the $2,000,000 GenesisCare Severance Fee, which will be recognized in rental revenues over the remaining GenesisCare Amended Master Lease term.
(3) The year ended December 31, 2024 includes a $2,000,000 severance fee received from GenesisCare, which is recognized in rental revenues over the remaining GenesisCare amended master lease term. Additionally, the years ended December 31, 2025 and 2024 include a property that was under development.
A discussion of the changes in our financial condition and results of operations for the years ended December 31, 2023 and 2022 may be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal years ended December 31, 2023 and December 31, 2022.
A discussion of the changes in our financial condition and results of operations for the years ended December 31, 2024 and 2023 may be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal years ended December 31, 2024 and December 31, 2023. 28 Table of Contents Regulation FD Disclosures We use any of the following to comply with our disclosure obligations under Regulation FD: SEC filings; press releases; public conference calls; or our website.
In addition to the cash we need to conduct our normal business operations, we expect to require $44,584,000 in cash over the next twelve months, of which $24,259,000 is related to estimated interest payments on our outstanding debt (calculated based on our effective interest rates as of December 31, 2024), $17,543,000 is related to unfunded loan commitment amounts undrawn on our mezzanine loans, and $2,782,000 is related to our various obligations as lessee.
In addition to the cash we need to conduct our normal business operations, we expect to require up to $43,554,000 in cash over the next twelve months, of which $31,673,000 is related to estimated interest payments on our outstanding debt (calculated based on the interest rates in effect as of December 31, 2025), up to $9,069,000 is related to a development to expand the Dover Healthcare Facility, and $2,812,000 is related to our various obligations as lessee.
We consider it to be a useful supplemental financial performance measure because it provides investors with additional information to understand our sustainable performance. Excluded items include listing-related expenses, severance, write-off of straight-line rent receivables related to prior periods, accelerated stock-based compensation, amortization of above- and below-market lease intangibles (including ground leases) and loss on extinguishment of debt.
Excluded items include listing-related expenses, severance, write-off of straight-line rent receivables related to prior periods, accelerated stock-based compensation, amortization of above- and below-market lease intangibles (including ground leases), loss on extinguishment of debt, changes in the current expected credit loss reserve and demolition costs.
We expect to meet our short-term liquidity 37 Table of Contents requirements through net cash flows provided by operations and borrowings on our credit facility and potential other borrowings. We believe we will have sufficient liquidity available to meet our obligations in a timely manner, under both normal and stressed conditions, for the next twelve months.
We believe we will have sufficient liquidity available to meet our obligations in a timely manner, under both normal and stressed conditions, for the next twelve months.
(2) The Fort Myers Healthcare Facilities and the Yucca Valley Healthcare Facility were vacant upon disposition on September 25, 2024 and December 10, 2024, respectively. This section describes and compares our results of operations for the years ended December 31, 2024 and 2023. We generate substantially all of our revenue from property operations.
This section describes and compares our results of operations for the years ended December 31, 2025 and 2024. We generate substantially all of our revenue from property operations.
We define FFO, consistent with NAREIT’s definition, as net income (calculated in accordance with GAAP), excluding gains from sales of real estate assets, impairment of real estate assets and disposition losses from sales of real estate assets, plus depreciation and amortization of real estate assets, and after adjustments for unconsolidated partnerships and joint ventures.
We define FFO, consistent with Nareit’s definition, as net income (calculated in accordance with GAAP), excluding gains and losses from sales of real estate assets, impairment of real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, and depreciation and amortization of real estate assets.
We encourage our shareholders and others interested in our company to monitor these distribution channels for material disclosures. The contents of our website address referenced herein is included in this Annual Report on Form 10-K as a textual reference only and is not incorporated by reference into this Annual Report on Form 10-K.
The contents of our website address referenced herein is included in this Annual Report on Form 10-K as a textual reference only and is not incorporated by reference into this Annual Report on Form 10-K. Overview We are a net lease REIT with a strategic focus on investing in the growing and resilient healthcare sector.
We continually monitor our tenants' ability to meet their lease obligations to pay us rent to determine if any adjustments should be reflected currently. As of December 31, 2024, our properties were 96.0% leased.
Negative trends in one or more of these factors could adversely affect our rental revenue in future periods. We continually monitor our tenants’ ability to meet their lease obligations to determine if any adjustments should be reflected currently. As of December 31, 2025, our properties were 98.7% leased.
From time to time, we evaluate our estimates based on historical experience and various assumptions that we believe are reasonable under the circumstances. Although our actual results historically have not deviated materially from those determined using estimates, our results of operations or financial condition could differ materially from these estimates under different assumptions or conditions.
From time to time, we evaluate our estimates based on historical experience and various assumptions that we believe are reasonable under the circumstances.
The following table shows the sources of distributions paid during the years ended December 31, 2024 and 2023: Year Ended December 31, Character of Distributions (1) : 2024 2023 Ordinary dividends 62.79 % 61.41 % Capital gain distributions — % — % Nontaxable distributions 37.21 % 38.59 % Total 100.00 % 100.00 % (1) Attributable to Class A shares, Class I shares, and Class T shares of common stock until the Listing and attributable to Common Stock after the Listing for the year ended December 31, 2024.
Further, the amount of distributions in excess of a U.S. stockholder’s tax basis in such shares will be taxable as a realized gain. 37 Table of Contents The following table shows the character of distributions the Company paid on a percentage basis during the years ended December 31, 2025 and 2024: Year Ended December 31, Character of Distributions (1) : 2025 2024 Ordinary dividends 73.84 % 62.79 % Capital gain distributions — % — % Nontaxable distributions 26.16 % 37.21 % Total 100.00 % 100.00 % (1) Attributable to Common Stock for the year ended December 31, 2025.
The 2027 Term Loan Agreement was entered into on March 20, 2024, to replace our prior senior unsecured term loan with Truist Bank, as Administrative Agent for the lenders, that had a maturity date of December 31, 2024, or the 2024 Term Loan, which was paid off in its entirety upon closing of the 2027 Term Loan Agreement.
The 2029 Revolving Credit Agreement was entered into on February 18, 2025, to replace our prior Revolving Credit Agreement with Truist Bank, as Administrative Agent for the Lenders, that had a maturity date of February 15, 2026, or the 2026 Revolving Credit Agreement.
Real Estate Acquisitions and Dispositions in 2024 • We purchased eight healthcare properties, comprising approximately 307,000 rentable square feet for an aggregate purchase price of approximately $164,053,000. • We sold four healthcare properties for an aggregate sale price of $18,700,000 and generated net proceeds of $17,705,000.
Real Estate Acquisitions in 2025 We purchased six healthcare properties, comprising approximately 241,000 rentable square feet for an aggregate purchase price of approximately $148,877,000.
To the extent our tenants have also experienced difficulties due to the foregoing economic and market conditions, and if there are changes to government reimbursements, they may be unable or unwilling to make payments or perform their obligations when due.
To the extent our tenants have experienced difficulties due to the foregoing economic and market conditions, they may be unable or unwilling to make payments or perform their obligations when due. 30 Table of Contents Rental Revenue The amount of rental revenue generated by our properties depends principally on our ability to maintain the occupancy rates of leased space and to lease available space at existing rental rates.
We may also make other real estate-related investments, which may include equity or debt interests in other real estate entities. As of December 31, 2024, we owned 135 real estate properties and two undeveloped land parcels.
Our properties include, among others, medical outpatient buildings, inpatient rehabilitation facilities, and surgical and specialty facilities. We may also make other real estate related investments, which may include equity or debt interests in other real estate entities.
Share Repurchase Program On August 16, 2024, the Board authorized a share repurchase program of up to the lesser of 1,500,000 shares of our outstanding Common Stock, or $25,000,000 in gross purchase proceeds for a period of 12 months from August 16, 2024.
Recent Developments Share Repurchase Program On August 4, 2025, the Board authorized a share repurchase program of up to $75,000,000 in gross purchase proceeds for a period of three-years from August 4, 2025, subject to the limitation of $25,000,000 in gross purchase proceeds in any twelve-month period.
Cash Flows Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Year Ended December 31, (in thousands) 2024 2023 Change Net cash provided by operating activities $ 132,847 $ 128,924 $ 3,923 Net cash (used in) provided by investing activities $ (149,687) $ 197,307 $ (346,994) Net cash used in financing activities $ (145,501) $ (137,129) $ (8,372) Operating Activities • Net cash provided by operating activities increased primarily due to cash collected for rent resulting from property acquisitions, annual rent increases, dividend income from money market funds and a decrease in interest paid on our credit facility, partially offset by a decrease in cash due to property dispositions, vacancies, and lease terminations with Steward and GenesisCare. 39 Table of Contents Investing Activities Significant investing activities included: • Investment of $164,053,000 to purchase eight properties in four separate transactions during the year ended December 31, 2024, compared to an investment of $69,822,000 to purchase two properties during the year ended December 31, 2023. • Received $17,705,000 from the sale of four properties during the year ended December 31, 2024, compared to receiving $270,306,000 from the sale of three properties during the year ended December 31, 2023. • Incurred capital expenditures, primarily for tenant improvements, of $2,989,000 during the year ended December 31, 2024, compared to incurring $3,177,000 during the year ended December 31, 2023.
Cash Flows Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Year Ended December 31, (in thousands) 2025 2024 Change Net cash provided by operating activities $ 119,145 $ 132,847 $ (13,702) Net cash used in investing activities $ (174,497) $ (149,687) $ (24,810) Net cash provided by (used in) financing activities $ 47,796 $ (145,501) $ 193,297 Operating Activities • Net cash provided by operating activities decreased primarily due to property dispositions, vacancies, lease terminations, a decrease in lease termination income, a decrease in dividend income from money market funds, and an increase in interest paid on our Unsecured Credit Facility, partially offset by an increase in cash collected for rent resulting from property acquisitions and annual rent increases.
Overview We invest in high quality properties leased to tenants capitalizing on critical and structural economic growth drivers. We are primarily focused on investing in healthcare facilities across the continuum of care, which we believe typically generate predictable, durable and growing income streams.
We invest in high quality net lease healthcare facilities along the continuum of care in the pursuit of generating predictable, durable and growing income streams. Our portfolio comprises high quality tenants in geographically diverse facilities, which are positioned to capitalize on the dynamic delivery of healthcare to patients.
On March 31, 2023, we sold one property for a sales price of $12,500,000, resulting in a gain on sale of $21,000. • Interest and other income increased primarily due to increases in dividend income from money market funds. • Interest expense decreased primarily due to a $1,481,000 decrease related to a reduction in the weighted average outstanding principal balance on our credit facility of $45,631,000 and a decrease of $1,157,000 related to a reduction in the weighted average interest rate on our credit facility, partially offset by a $520,000 increase in amortization of deferred financing costs and a $228,000 increase in loss on extinguishment of debt.
On December 10, 2024, we sold one property for a sales price of $1,700,000, resulting in a gain on sale of $265,000. • Interest and other income decreased primarily due to a decline in dividend income attributable to a lower average investment in money market funds from the deployment of proceeds in the prior year. • Interest expense increased due to a $10,923,000 increase primarily resulting from a higher weighted average interest rate on our credit facility, driven by higher fixed rates on interest rate swaps entered into to replace five interest rate swaps that matured on December 31, 2024 and higher average borrowings on our variable rate debt, a $638,000 increase in amortization of deferred financing costs, and a $5,000 increase in loss on extinguishment of debt in connection with entering into the 2029 Revolving Credit Agreement (as defined below) to replace the 2026 Revolving Credit Agreement (as defined below). • The current expected credit loss reserve increased by $180,000 due to the recognition of expected credit losses associated with two mezzanine loans we entered into in November 2024.
In addition, we expect that the Listing will enhance our liquidity given that we now have publicly-traded stock. We may issue such publicly-traded stock within the next twelve months, afterwards, or both to raise funds to meet our liquidity needs.
We expect to meet our short-term liquidity requirements through proceeds from cash flows from operations and borrowings on our credit facility and potential other borrowings. Additionally, we may issue our Common Stock within the next twelve months, afterwards, or both to raise funds to meet our liquidity needs.
Regulation FD Disclosures We use any of the following to comply with our disclosure obligations under Regulation FD: SEC filings; press releases; public conference calls; or our website. We routinely post important information on our website at www.silarealtytrust.com, including information that may be deemed material.
We routinely post important information on our website at www.silarealtytrust.com, including information that may be deemed material. We encourage our shareholders and others interested in our company to monitor these distribution channels for material disclosures.
We consider our critical accounting estimates to be those used in the determination of the reported amounts and disclosure related to the impairment of long-lived assets. We review our real estate assets on an asset group basis for impairment. Typically, an individual property constitutes an asset group.
Although our actual results historically have not deviated materially from those determined using estimates, our results of operations or financial condition could differ materially from these estimates under different assumptions or conditions. 29 Table of Contents We consider our critical accounting estimates to be those used in the determination of the reported amounts and disclosure related to the impairment of long-lived assets.
Changes in other (expense) income are summarized in the following table (amounts in thousands): Year Ended December 31, 2024 2023 $ Change % Change Gain on dispositions of real estate $ 341 $ 22 $ 319 1,450.0 % Interest and other income 4,130 702 3,428 488.3 % Interest expense (21,220) (23,110) 1,890 (8.2) % Total other (expense) income $ (16,749) $ (22,386) $ 5,637 (25.2) % • During the year ended December 31, 2024, we recognized a gain on disposition on two real estate properties.
We recorded impairment and disposition losses in the aggregate amount of $1,210,000 during the year ended December 31, 2024 as a result of tenant related triggering events that occurred at certain properties and costs related to the disposition of the Fort Myers Healthcare Facilities. • Demolition costs of $1,011,000 were recorded during the year ended December 31, 2025, related to the demolition of the Stoughton Healthcare Facility. 33 Table of Contents Changes in other (expense) income are summarized in the following table (amounts in thousands): Year Ended December 31, 2025 2024 $ Change % Change Gain on dispositions of real estate $ — $ 341 $ (341) n/a Interest and other income 1,169 4,130 (2,961) (71.7) % Interest expense (32,786) (21,220) (11,566) 54.5 % Increase in current expected credit loss reserve (180) — (180) n/a Total other (expense) income $ (31,797) $ (16,749) $ (15,048) 89.8 % • During the year ended December 31, 2025, we did not dispose of any real estate properties.
Removed
Recent Developments New York Stock Exchange Listing and Reverse Stock Split On June 13, 2024, our Common Stock was listed and began trading on the NYSE under the ticker symbol "SILA".
Added
As of December 31, 2025, we owned 140 real estate properties and three undeveloped land parcels, including the Stoughton Healthcare Facility which has been taken out of service and is being demolished.
Removed
Upon the Listing, all outstanding shares of Class I Common Stock and Class T Common Stock were automatically converted into shares of Class A Common Stock on a one-for-one basis and authorized but unissued shares of Class I Common Stock, Class T Common Stock and Class T2 Common Stock were reclassified into additional shares of Class A Common Stock.
Added
The Company did not repurchase any shares under the 2025 SRP during the year ended December 31, 2025. During the year ended December 31, 2025, the Company repurchased 304,878 shares of Common Stock for an aggregate purchase price of $7,344,000, excluding all related costs and fees, under a prior share repurchase program.
Removed
Class A Common Stock was then immediately renamed “Common Stock” and is the sole class of stock traded on the NYSE.
Added
Automatic Shelf Registration Statement On August 12, 2025, we filed with the SEC an automatic shelf registration statement on Form S-3 that is effective for a term of three years, covering future offerings of an indeterminate amount of our Common Stock, preferred stock, depositary shares, warrants, purchase contracts and units.
Removed
On April 8, 2024, in anticipation of the Listing, we amended our charter to effect a one-for-four reverse stock split, or the Reverse Stock Split, of each issued and outstanding share of each class of our Common Stock, effective May 1, 2024, and we also amended our charter to decrease the par value of each issued and outstanding share of our Common Stock from $0.04 par value per share to $0.01 par value per share immediately after the Reverse Stock Split.
Added
In connection with the filing of the registration statement, on August 12, 2025, we filed a prospectus supplement related to the ATM Program (as defined below), with the SEC.
Removed
In addition, equitable adjustments were made to the maximum number of shares of our Common Stock that may be issued pursuant to the A&R Incentive Plan to reflect the Reverse Stock Split. The number of shares of our Common Stock subject to outstanding awards under the A&R Incentive Plan were also equitably adjusted to reflect the Reverse Stock Split.
Added
At-the-Market Program On August 12, 2025, we entered into an ATM Equity Offering Sales Agreement, or the ATM Program, through which, from time to time, we may offer and sell shares of Common Stock having an aggregate offering price of up to $250,000,000.
Removed
The Reverse Stock Split affected all record holders of our Common Stock uniformly and did not affect any record holder’s percentage ownership interest. The Reverse Stock Split did not affect the number of our authorized shares of Common Stock.
Added
During the year ended December 31, 2025, no shares were issued under the ATM Program and as of December 31, 2025, we had $250,000,000 in gross sales of available capacity under the ATM Program.
Removed
Therefore, as of December 31, 2024, up to $25,000,000 of our Common Stock remained available for repurchase under the Share Repurchase Program.
Added
On July 4, 2025, the One Big Beautiful Bill Act, or OBBBA, was signed into law. The OBBBA includes, among other things, changes to Medicaid and health insurance marketplaces that may have an impact on our tenants’ financial position. We continue to evaluate the impacts of the OBBBA.
Removed
Termination of Share Repurchase Program and Distribution Reinvestment Plan In light of our intention to pursue the Listing, on April 5, 2024, the Board approved the suspension of the Terminated SRP, effective immediately, and the termination of the Terminated SRP, effective upon the Listing.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

8 edited+2 added−2 removed6 unchanged
Biggest changeAs of December 31, 2023, our total principal debt outstanding of $525,000,000 was fixed through 11 interest rate swap agreements, which mature, or matured, on various dates from December 31, 2024 to January 31, 2028.
Biggest changeAs of December 31, 2025, of our total principal debt outstanding of $676,000,000, $525,000,000 was fixed through 10 interest rate swap agreements, of which six mature on January 31, 2028 and four mature on March 20, 2029. As of December 31, 2024, our total principal debt outstanding of $525,000,000 was fixed through 10 interest rate swap agreements.
See Note 9—"Credit Facility" and Note 12—"Derivative Instruments and Hedging Activities" in the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for more information about the impacts of our interest rate swaps on our outstanding debt and for more information about our interest rate swaps.
See Note 10—"Credit Facility" and Note 13—"Derivative Instruments and Hedging Activities" in the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for more information about the impacts of our interest rate swaps on our outstanding debt and for more information about our interest rate swaps.
As of December 31, 2024, the weighted average interest rate on our total principal debt outstanding was 4.62%, including the impact of our interest rate swap agreements. We have entered, and may continue to enter, into additional derivative financial instruments, such as interest rate swaps, in order to mitigate our interest rate risk on a given variable rate financial instrument.
As of December 31, 2025, the weighted average interest rate on our total principal debt outstanding was 4.69%, including the impact of our interest rate swap agreements. We have entered, and may continue to enter, into additional derivative financial instruments, such as interest rate swaps, in order to mitigate our interest rate risk on a given variable rate financial instrument.
We have obtained variable rate debt financing and we are exposed to such changes in the one-month Term SOFR. Loans under the Unsecured Credit Facility may be made as Base Rate Loans or SOFR Loans, at our election, and all of our interest rate swap agreements are indexed to SOFR.
We have obtained variable rate debt financing and we are exposed to such changes in the Secured Overnight Financing Rate, or SOFR. Loans under the Unsecured Credit Facility may be made as Base Rate Loans or SOFR Loans, at our election, and all of our interest rate swap agreements are indexed to SOFR.
We may also enter into rate-lock arrangements to lock interest rates on future borrowings. In addition to changes in interest rates, the value of our future investments will be subject to fluctuations based on changes in local and regional economic conditions and changes in the creditworthiness of tenants, which may affect our ability to refinance our debt, if necessary.
In addition to changes in interest rates, the value of our future investments will be subject to fluctuations based on changes in local and regional economic conditions and changes in the creditworthiness of tenants, which may affect our ability to refinance our debt, if necessary.
As of December 31, 2024, a decrease of 50 basis points in the market rates of interest would have resulted in a decrease to the settlement asset value of these interest rate swaps to a value of $3,311,000. These interest rate swap agreements were designated as cash flow hedging instruments.
As of December 31, 2025, a decrease of 50 basis points in the market rates of interest would have resulted in a decrease to the settlement value of these interest rate swaps to a liability value of $7,194,000. These interest rate swap agreements were designated as cash flow hedging instruments.
As of December 31, 2024, the interest rate swap agreements had an aggregate notional amount of $525,000,000 and an aggregate settlement asset value of $11,764,000. The settlement value of these interest rate swap agreements is dependent upon existing market interest rates and swap spreads.
As of December 31, 2025, the interest rate swap agreements had an aggregate notional amount of $525,000,000 and an aggregate settlement liability value of $819,000. The settlement value of these interest rate swap agreements is dependent upon existing market interest rates and swap spreads.
As of December 31, 2024, an increase of 50 basis points in the market rates of interest would have resulted in an increase to the settlement asset value of these interest rate swaps to a value of $20,023,000.
As of December 31, 2025, an increase of 50 basis points in the market rates of interest would have resulted in an increase to the settlement value of these interest rate swaps to an asset value of $5,436,000.
Removed
On November 27, 2024, we entered into two interest rate swap agreements, which have an effective date of December 31, 2024 and an aggregate notional amount of $150,000,000. Additionally, on December 6, 2024, we entered into two interest rate swap agreements, which have an effective date of December 31, 2024 and an aggregate notional amount of $100,000,000.
Added
We may also enter into rate-lock arrangements to lock interest rates on future borrowings. As of December 31, 2025, of the $676,000,000 total principal debt outstanding, $151,000,000 was subject to variable interest rates, indexed to daily SOFR, with an interest rate of 4.91% per annum.
Removed
The four swaps have a maturity date of March 20, 2029, and were entered into to replace five interest rate swaps with an aggregate notional amount of $250,000,000 that matured on December 31, 2024. 43 Table of Contents As of December 31, 2024, our total principal debt outstanding of $525,000,000 was fixed through 10 interest rate swap agreements, of which six mature on January 31, 2028 and four mature on March 20, 2029.
Added
As of December 31, 2025, an increase of 50 basis points in the market rates of interest would have resulted in an increase in interest expense of approximately $755,000 per year.

Other SILA 10-K year-over-year comparisons