National Health Investors (NYSE:NHI) reported fourth-quarter 2025 results that management described as a “solid” finish to the year, driven by growth in its Seniors Housing Operating Portfolio (SHOP) segment and an active investment year that exceeded the company’s initial expectations.
Fourth-quarter and full-year performance
CEO Eric Mendelsohn said normalized funds from operations (FFO) per share rose 8.9% in the fourth quarter compared with the prior year, while full-year normalized FFO per share increased 10.6%. Total funds available for distribution (FAD) increased 11.1% in the fourth quarter and 13.7% for the full year.
Within the triple-net portfolio, Mendelsohn said cash rental income rose about 7% in the quarter, primarily due to acquisitions, while interest income declined 19% due to loan payoffs and paydowns.
CFO John Spaid reported fourth-quarter net income of $0.80 per share, down 15.8% from the prior-year period. He noted the comparison was affected by items recognized in the prior year, including a $6.3 million non-cash gain related to derivative accounting for forward equity sales agreements and a $5 million gain on real estate sales. Full-year net income was $3.02 per share, compared with $3.13 in the prior year.
Spaid said Nareit FFO per share was $1.22 in the fourth quarter (down 1.6% year over year) and $4.65 for the year (up 2.2%). Normalized FFO per share was $1.22 in the quarter and $4.91 for the year, reflecting the 8.9% and 10.6% increases, respectively. He also pointed to several “one-time items” that benefited 2025 results, including higher gains from equity-method investments, a benefit to credit loss reserves, and cash rental income recognized upon lease terminations.
SHOP expansion, operating trends, and underwriting
Management repeatedly emphasized its focus on scaling SHOP. Mendelsohn said the company has been investing in personnel and resources, noting NHI now has 35 employees, a 46% increase from the average headcount in 2022 when the SHOP platform was established. Including a February 2026 acquisition, he said SHOP investment has increased 106% over the last 12 months to about $740 million, lifting SHOP’s annualized NOI contribution to 12% of total annualized NOI from 4.5% at the end of 2024.
Chief Investment Officer Kevin Pascoe said fourth-quarter SHOP NOI increased 124.9% year over year, driven by the transition of seven properties on Aug. 1 and the acquisition of four properties on Oct. 1. Same-store NOI on the 15 legacy Holiday properties declined less than 1% year over year in the quarter, but increased 8.7% sequentially from the third quarter. For 2026, guidance assumes 7%–8% same-store SHOP NOI growth, weighted more to the second half as occupancy recovers and 16 units at one building return to service in May.
On the earnings call, Pascoe characterized the same-store guidance as conservative, saying the company aims to provide targets it feels confident it can achieve and then “underpromise, overdeliver.” He cited a seasonal pattern early in the year and initiatives focused on the sales funnel.
In response to questions about lessons learned from the legacy Holiday portfolio, Mendelsohn described the Holiday SHOP situation as “more of a science experiment” stemming from Holiday’s sale to Atria and Welltower, and said NHI has invested significant capital expenditures and changed managers. He also said NHI believes it is performing “as good or better” than peers with similar Holiday assets, based on what the company can surmise. Management stressed that newer SHOP assets include assisted living and memory care—not just independent living—and are expected to deliver stronger growth profiles.
Investment activity, pipeline, and planned dispositions
NHI reported a particularly active investment year. Pascoe said 2025 included $392.4 million of announced investments at an 8.1% average initial yield, with $217.5 million in the fourth quarter alone. Mendelsohn said 2025 was the company’s most active year since 2016 and exceeded its initial $225 million investment guidance.
In early 2026, the company closed what it called its largest SHOP acquisition to date: $105.5 million for nine properties in Kentucky, South Carolina, and Tennessee. Pascoe said the initial first-year NOI yield is expected to be about 8%, or 7.6% including routine capital expenditures. Allegro Living Management will manage the properties, and Pascoe said the company expects transitional impacts in year one and “solid double-digit growth” in year two. He added that Allegro is an affiliate of Spring Arbor Management, bringing NHI’s total investment with Spring Arbor to $227 million.
Management also detailed its pipeline, including $110.6 million under signed letters of intent and an additional $488 million of evaluated opportunities, all in senior housing. Pascoe said the company is also reviewing several large potential investments not included in the pipeline number.
NHI is also pursuing capital recycling. Pascoe said the company planned dispositions of seven buildings with six operators, describing them as non-strategic properties and emphasizing that the decision is tied to operator relationships and asset-management intensity. He said the goal is to reallocate capital and internal resources to relationships with more growth potential.
Balance sheet, leverage policy, and dividend
Spaid said NHI ended 2025 with $19.6 million of cash, $496 million in revolver capacity, and $315.8 million available on its at-the-market (ATM) program assuming settlement of forward equity sale agreements. He said net debt to adjusted EBITDA was 3.8x for the quarter, and total available liquidity was about $875 million.
The company also announced an update to its leverage policy, lowering its target range to 3.5x–4.5x net debt to adjusted EBITDA from 4x–5x. Spaid said the change reflects the importance of maintaining an investment-grade rating and the impact of a “higher for longer” interest rate environment on debt service coverage ratios.
NHI’s board declared a $0.92 per share dividend for shareholders of record on March 31, 2026, payable May 1, 2026.
2026 guidance and key watch items
For 2026, NHI guided to midpoint growth of 6.9% in Nareit FFO per share and 1.2% in normalized FFO per share, with total FAD expected to rise 7.8% to $250.2 million at the midpoint. Mendelsohn acknowledged the normalized FFO per share midpoint growth rate was not where management views the company’s “core growth rate,” citing non-recurring benefits in 2025 and planned 2026 dispositions. Adjusting for those factors, he said management estimates a normalized growth rate of roughly 5%–6%, and noted that the midpoint of 2026 guidance implies an approximate two-year CAGR of about 6%.
Spaid said 2026 guidance includes $230 million of future investments at an average NOI yield of 7.8%, and assumes roughly 70% of investment activity will be allocated to SHOP.
One key item not included in guidance is the resolution of NHI’s lease with NHC, which matures Dec. 31, 2026. Spaid said negotiations are ongoing, while Mendelsohn described the company as being in a “quiet period” on the topic. Management also discussed Bickford deferred rent collections, noting collections have exceeded expectations and that a rent reset is expected April 1, with additional details to be provided on a future call.
About National Health Investors (NYSE:NHI)
National Health Investors, Inc (NYSE: NHI) is a specialized real estate investment trust (REIT) focused on owning and financing high-quality healthcare and senior housing facilities in the United States. The company’s portfolio encompasses a diverse range of properties, including skilled nursing centers, assisted living and memory care communities, behavioral health facilities, dialysis clinics, and medical office buildings. NHI typically enters into long-term net-lease agreements with experienced healthcare operators, providing stable and predictable rental income streams while enabling its tenants to concentrate on delivering quality care.
Since its founding in 1991 and initial public offering later that year, National Health Investors has pursued a disciplined growth strategy centered on strategic acquisitions, joint ventures, and selective development.
